Twofer Tuesday: Monkey Business

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April 27, 2010. Tags: , , . Entertainment, Music, Politics, Popular Culture. Comments off.

Updates: A Few Good Traders…Goldman Sachs on the Hill…

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April 27, 2010. Tags: , , , , , , . Economy, Finance, Obama Administration, Politics, Popular Culture, TARP, Wall St. Comments off.

Meredith Whitney: Goldman has lost its edge & housing double dip still ahead…

Update: Housing prices fall, Case Schiller is having a hard time with their price series due to enormous jumps in seasonality this go around,

After reviewing the data, the S&P/Case-Shiller Home Price Index Committee believes that, for the present, the unadjusted series is a more reliable indicator and, thus, reports should focus on the year-over-year changes where seasonal shifts are not a factor. Additionally, if monthly changes are considered, the unadjusted series should be used….

this is unlike any other housing drop, in terms of severity and government intervention, so any series cannot capture where prices are going..

…On an unadjusted basis, prices dropped 0.9 percent in February, worse than the estimated 0.3 percent decline and following a 0.4 percent downturn in January….

…The report suggests more price erosion is possible before prices start rising on a sustained basis, S&P said. The price improvement can be attributed to momentum from the federal homebuyer tax credits, which expire on April 30, and prices could be pressured further by foreclosure sales….

More on falling prices from First Logic via Calculated Risk:

…On a month-over-month basis, the national average home price index fell by 2.0 percent in February 2010 compared to January 2010, which was steeper than the previous one-month decline of 1.6 percent from December to January…

Vodpod videos no longer available.

Best financials analyst on the street Meredith Whitney’s latest comments on financials and housing via CNBC:

Beleaguered banking giant Goldman Sachs has lost much of the edge it had over competitors due to the recent government charges and is a stock investors should avoid, analyst Meredith Whitney told CNBC.

…(GS) faces a future in which its brand has been tainted and it will lose business to small competitors, said Whitney, who doesn’t have a “buy” rating on Goldman or any of the other big banks…

…The company’s stock should trade around book value, Whitney added, which would place the price just above $120….

Reasserts the double dip in housing-

…On other issues, Whitney called proposed new financial reform regulations “squishy” but said the result will be banks shrinking their balance sheets and consumers forced to seek predatory lenders for credit.

She also renewed her prediction that the housing market would see a double dip as more inventory is forced back onto the market.

April 27, 2010. Tags: , , , , , , , , . Economy, FDIC, Finance, Foreclosures, Housing, Obama Administration, Politics, TARP, Wall St. 2 comments.

Obama Financial Reform bill maintains Too Big To Fail bailouts: Geithner admits to Brad Sherman (D-CA) the financial reform bill will allow Treasury to give unlimited funds in future ‘failures’..

Update: CSPAN has the full hearing up here, see here for the testimony of the examiner who did the forensic accounting on the Lehman collapse. He starts out explaining how highest levels of regulators were ‘concerned’ about Lehman in 2007 but did absolutely nothing, not the NYFed not the SEC. None of them took action.

Treasury Secretary Tim Geithner tells Rep. Brad Sherman that “You cannot know in advance how much money you will need to resolve a Lehman.” This confirms the Democrats want to set up a bailout fund without limits.

Perfect. The big behemoths who brought us to our knees will get nifty low rates since everyone will know once this is passed, their debts are protected by taxpayers funds in bailouts of hand selected collateral debtholders by Treasury in future failures…kill this bill it is a giant gift to JPMC, GS and whomever is making money on FAN FRED FHA Citi BofA, see the excellent analysis at Naked Capitalism:

In a letter to Senate majority leader Harry Reid and minority leader Mitch McConnell, luminaries including former SEC Chief Accountant Lynn Turner, former Labor Secretary Robert Reich, hedge fund owner Jim Chanos, former Lehman Brothers Vice Chair Peter Solomon, former S&L investigator Bill Black, former Senate Banking Committee Chief Economist Rob Johnson, economists Dean Baker, Barry Eichengreen and others pointed out that Dodd’s proposed financial reform legislation wouldn’t have prevented the current crisis … and won’t prevent the next crisis.

Dodd himself has admitted that his bill “will not stop the next crisis from coming”.

In fact, the bill is wholly ineffective, failing to address the core things which need to be done to stabilize the economy. See this, this and this….

The House Financial Services Cmte heard testimony from SEC head Mary Schapiro, Bernanke and Geithner on the regulatory failures during Lehman. I support a well regulated free market. Not a market with tons of regulations that no one enforces on the select few who payoff the regulators or otherwise ‘capture’ them.

It was CRYSTAL clear that they HAVE THE POWERS THEY NEED already in the case of Lehman, and they were victims of REGULATORY CAPTURE and failed to act. Tim Geithner specifically admitted to Ed Royce R-CA that yes as head of NY Fed under his purview Lehman FAILED stress tests, yet they did..nothing. Here is Royce telling Geithner LAST JULY that the permanent bailout authority they had in the bill then was unacceptable

Sarbanes Oxley was the regulation needed, Dick Fuld signed the financial statements under SarbOx he should be prosecuted. We got better results from Dubyah with Enron for Gawd’s sake.

They don’t need more unchecked power to proclaim bailouts and seize large American firms without Congressional approval and dole out bailouts a la GM and Chrysler in the way they deem fit. That is exactly what the Dodd bill does.

Team Obama has repeatedly told Mark Warner D-VA, Chris Dodd, D-Countrywide, Blanche Lincoln -D-AR, to pull out of negotiations with the GOP, specifically Bob Corker R-TN and Shelby R-GA. They portray Obama as entering the fray early on this one. HA! AS IF!! Dodd and Shelby and sometimes Corker have been hammering at this for over a year already. Pullllease….

This is all kabuki from the team of ubergeniuses that funded Os campaign and who apparently have killed the Volcker Rule..again. We really have no one to fight for us here IMO.

The GOP will not allow the Volcker Rule which would effectively limit some of the risks of collapse and TBTF,(since we have no earthly idea what the banks are really holding, Repo 105s and all)  (and the bank taxes the Left is levying globally will assure financial business doesn’t flee to UK for now) and the Dems are in bed with these guys calling the shots on regulation, see Dodd, Chris and the WH which wants to leave the rule vague and they claim that is by design:

…Banks for months have groused that the Volcker rule, which proposes to ban banks that take deposits from trading securities for the firm’s benefit only, doesn’t offer a well-defined description of what constitutes proprietary trading activity.

Banks including JPMorgan Chase, Morgan Stanley and Goldman Sachs argue that there are gray areas in which they are engaging in proprietary trading to hedge their own activities as financial intermediaries with clients.

“What [lawmakers] are outlining is the idea of what we are trying to prevent,” the official said. “These are guidelines. What the banks are saying is, ‘We want that to be written into the law — the details of which kind of transactions should count — and I think that that’s a bit disingenuous.”…

Exile on Main Street baby. Hey I’ll party with the people patriots anyday of the week. When push comes to shove, people look out for each other here in ‘the Middle’. I love Main St. It is my favorite part of Disneyland in fact, lol.

Main St, U.S.A. Disneyland

April 20, 2010. Tags: , , , , , , , , , , , . Economy, Finance, Housing, Obama Administration, Politics, Popular Culture, TARP, Taxes, Wall St. 1 comment.

Updates: These short positions GS took are the AIG CDS’ we lost billions on?! Golden Slacks getting hammered by SEC fraud charges…

Update: Oh shxt! I didnt realize the short positions they are talking about are the damn AIG CDS!!! Oh snap! These are the frakkin CDS we lost BILLIONS on via AIG! h/t doc holiday:

Skeptical CPA: December 2008Re: “Some of AIG’s speculative bets were tied to a group of [CDOs] named ‘Abacus,’ created by [GSG]. … In what amounted to a side bet on the value of these holdings, AIG agreed to pay [GSG] if the mortgage debt declined in value and would receive money is it rose. … The plan has resulted in banks in North America and Europe emerging as winners: They have kept the collateral they previously received from AIG and received the rest of the securities’ value in the form of cash from Maiden Lane III. … It also has been a double boon to banks and financial institutions that specifically bought protection on now shaky mortgage securities and are effectively being made whole on those positions by AIG and the [Fed]”, my emphasis, Serena Ng, Carrick Mollenkamp & Michael Siconolfi at the WSJ, 10 December 2008.”

Update: Cramer is all over CNBC saying his confidential high sources say GS had a position , long, in the CDO, really laying it on shilling for Golden, really sad. Saying its caveat emptor the German bank who took losses is responsible, while he is saying GS was long the position. Shill Jim shill. wow some guy(silvan raines, sp?) says Cramer takes money from GS to his face on the air just now, heh.

Update: Here is Boehner stmt, he calls GS Pres Obamas top Wall St Ally, oohhh, nice:

“These are very serious charges against a key supporter of President Obama’s bill to create a permanent Wall Street bailout fund.  Despite President Obama’s rhetoric, his permanent bailout bill gives Goldman Sachs and other big Wall Street banks a permanent, taxpayer-funded safety net by designating them ‘too  big to fail.’  Just whose side is President Obama on?

“Instead of permanent bailouts for President Obama’s Wall Street allies, Republicans believe the best way to protect taxpayers is by reforming Fannie Mae and Freddie Mac, the government-sponsored companies that sparked the meltdown by giving high-risk loans to people who couldn’t afford it.”

NOTE: Goldman Sachs was President Obama’s top Wall Street contributor during the 2008 election cycle, donating nearly $1 million to his campaign.

Update: John Boehner GOP minority leader House, just put a wicked spin on that ball, his statement said these charges against GS a partner in Pres Obamas Fin Reg Plan are very concerning, that the FIn Reg Reform Bill will protect GS as too big to fail, Boehner said, whose side is President Obama on? oooooohhhh!! ^5 to Boehner

Update: So I was thinking the Volcker Rule is gonna make a BIG comeback off this, ya know? I mean WSJ was just declaring it dead, again, this week and I do not see how the banks are gonna fight Volcker Rule and the Consumer Protection Thingy in the face of the headlines the lamestream put together off this. And it is things like this that kill the markets for everyone, thanks GS you frakkers.

12:51pm EST: DOW down 153 now, back under 11k, like Spinal Tap, it goes to eleven..that’s about all that number was worth…S&P back under the big 1200 the traders were so excited about…GLD, OIL, all down…

Update: Steve Liesman – Paulson’s right hand man, Pelligrini,  was source of confirmation for the fraud charges in re his selection of the ‘lousy’ subprime securities that went into the CDO. He left Paulson in 2009. Steve says what Paulson did is likely not illegal, the issue is disclosure and that is all on GS…

Paging Andrew Cuomo, will Andrew Cuomo please file an indictment on the white courtesy phone….

Update: WSJ has the SEC complaint up in pdf here

Update Q/A Adam Schapiro of FoxBiz asks other fin firms did this, on synthetic CDOs like Deutsche Bank, are they facing charges?

ongoing investigation is the answer

DOW is tanking, down 75 now, GS down 20 (12%)

Q- Why Paulson not charged?

A- Paulson didnt make the representation to the long investors, GS did.

Update:11:11 am est:  SEC conf call LIVE on CNBC now!

they chose which MBS would make up this CDO, J Paulson had significant role in building product, had incentive to choose worst rated MBS to put in the CDO and then they took a short position against it

the prospectus for the long investors in the CDO revealed none of this including Paulsons role..

long investors lost $1b, paulson made $1b

Sing with me!

Karma chameleon baby

CNBC Chyron: SEC charges GS with FRAUD ON SUBPRIME SECURITIES

Muhhuuuuhaaaaa!!!!!

SEC: GS misstated, omitted key facts related to subprime products

SEC: (John) Paulson & Co had hand in structuring CDO in question

SEC grew a pair, hoocodanode!

April 16, 2010. Tags: , , , , , , , , , , , , . Economy, Finance, Foreclosures, Housing, Obama Administration, Politics, Popular Culture, TARP, Wall St. Comments off.

Obama throws the Tall Man under the bus…

As any Gen X-er can tell you, you gotta be really careful with the Tall Man…he comes back….

Volcker is back under the bus (for now). As we  noted here last November, Jamie Dimon among others killed the return of Glass Steagall once already (and I am in no position to challenge Jamie’s call on this, the CDS issue is much more problematic IMO, THAT is where they take the proprietary info and make bets against their clients IMO)…

After the EPIC FAIL in Massachusetts, Obama dragged Volcker out of the closet they were keeping him in and tried to look ‘tough’ on bankstas….that is of course short lived since Jamie and Blankfein funded Obama’s campaign….now the WH has rolled over and showed its belly to the bankstas for some more scratches….hard to have sympathy for Volcker, he is one of the fools who backed Obama early and made him look moderate as a result.

Charlie Gasparino has it at DailyBeast:

Barack Obama owes Paul Volcker a lot, but he apparently owes the fat cats on Wall Street even more. That’s the only reasonable conclusion that can be made from the president’s timely and, in some ways, bizarre about-face on the former Fed chairman’s plans to reform the financial industry and prevent another meltdown.

As first reported by the New York Post, Volcker’s bank-reform idea—the one trotted out by the president with Volcker standing at his side just hours after Republican Scott Brown won Teddy Kennedy’s seat and vowed to help crush Obama’s economic agenda—has been nixed in favor of a watered-down version that bank chiefs like J.P. Morgan CEO Jamie Dimon and other Obama supporters on Wall Street are advocating.

…Sources tell me a coalition of Wall Street heavyweights from Dimon to people like Larry Fink, the head of money-management powerhouse BlackRock—Obama supporters all—made their opposition to the plan well-known to the administration. The message was clear: Wall Street, which helped elect Barack Obama with an unprecedented support for a Democratic presidential candidate (Goldman Sachs was the second largest contributor to the president’s campaign), was ready to start backing the opposition of the so-called Volcker Rule….

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February 26, 2010. Tags: , , , , , , , , , , , . Finance, Obama Administration, Politics, Popular Culture, Wall St. 5 comments.

Kabuki on the Hill: Bank CEOs testify to ‘Financial Crisis Commission’ 9:00am EST

Update 3: 12:13pm: Angelides asking Blankfein what his responsibility was to the investor on those loans they securitized and sold, Blankfein is claiming they were sophisticated investors who sought that exposure. Basically, they deserved it? I dunno. Angelidies got an Agatha Christie analogy in, I always love those. He said maybe it is like Murder on the Orient Express and everyone did it, but still, how much responsibility is yours ….was your due diligence adequate? Blankfein trying to wiggle around it….good luck Lloyd…under oath, liability lawyers hanging on their chairs now….Phil says GS was doing more, they were also facilitating the market in which the products existed, Lloyd agrees to that extent they made that market…

Update 2: 10:07am: Phil Angelides questioning of Lloyd Blankfein was great. Lloyd keeps saying as a ;market-maker’ it is perfectly fine for GS to sell MBS derivatives to clients while simultaneously closing GS OWN position in those assets due to risk..Phil doesnt buy it.

BILL THOMAS! Vice Chair of the Commission just offered the American people his email if they want to submit a question to any of these CEOS!! Well I do!

billthomas@fcic.gov or some derivative thereof…send in your questions!

I really liked Moynihan’s opening statement, he is grateful to the American people, Blankfein needs to eat some of the humble pie Brian had before he arrived. (FD-MiM are BofA shareholders and are keenly interested in how Brian does today, his first big appearance since taking reins as BofA CEO)

Update 1: 9:07 am EST: WOW!! They put them under oath!! first time I have seen these bank CEOs be put under oath (except Ken Lewis on the BofA Merrill witchtrials)

CNBC should carry a livestream of the testimony here when it begins later today NOW LIVE (9:00 am EST, just began opening statements)

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January 13, 2010. Tags: , , , , , , , , , , , , , . Economy, Finance, Foreclosures, Housing, Obama Administration, Politics, TARP, Taxes, Wall St. 2 comments.

Golden Slacks to make a profit?? Housing Update: All About Fannie Mae – Delinquency rate explodes, book of business now at $3.242 trillion

Golden Slacks update moved to end of post

Oh shxt! I feel like Butch Cassidy and the Sundance Kid looking at that hockey stick cliff of a chart on FANNIE default rates, can’t we just face the Bolivian Army instead?! Maybe they WILL surrender to us!

FNM SD 10.30

courtesy of Tyler Durden @ ZeroHedge

From DirectorBlue, courtesy of Tyler Durden @ ZeroHedge h/t Instapundit. And the ABSOLUTE LOONS in Congress think extending a homebuyer tax credit is the way to spend money in housing when FAN FRED defaults are rising this way? Good Gawd Almighty. The Tarp Congressional Oversight Panel agrees, the Treasury housing plan IS NOT WORKING.

The [Fannie Mae] “seriously delinquent” rate has gone parabolic, increasing by roughly 5% sequentially and just under 300% YoY [year-over-year]. As mere text will simply not do this metric justice, please enjoy this chart of the dataset from Blytic. It tells you all you need to know about the Fed’s containment of the housing problem

The August seriously delinquent single-family number comprised of a 2.87% non-credit enhanced delinquencies and a very bothersome 11.52%, consisting of credit enhanced loans… The deterioration of FNM’s book however did not stop it from increasing the size of its book [loans]. In September Fannie’s total book of business hit $3.242 trillion, up from $3.229 trillion in August and $3.079 trillion in the prior year…

…This trend should bother you, dear taxpayer, because it is your money on the hook here, which is not only massively mismanaged by Bernanke & Co., LLC, but which sees another $80 billion of free funding every month courtesy of the dollar printing press to onboard even more toxic garbage onto your balance sheet….

We have been covering the housing mess extensively, not least because we are in the middle of it here in Phoenix. We discussed the impending FHA bailout (which they still deny they need) here. Our coverage of the impending second collapse in housing courtesy of UBS’ think tank here. Some highlights:

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November 1, 2009. Tags: , , , , , , , , , , , , , , , , , . Economy, Finance, Foreclosures, Housing, Obama Administration, Politics, TARP, Unemployment Statistics, Wall St. 5 comments.

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