Dow futures are lower

[Bubblesitter]

Should be another interesting day on Wall street. The international indices took a beating last night.

Credit fears tied to subprime are the root cause of all of this.

The LBO craze is over, the long bull run is gasping, and credit is crunching.

Again another Kudos to Rich and Piggington site. You were the proverbial voice in the wilderness 2-3 years ago, highlighting the risks of all these exotic mortgages. It took the mainstream media a while to pick up on this.

[Bubblesitter]

a little early morning venting…..

I would like to thank all you folks who now in your small little way helped plung the world into financial chaos and will probably put the US into a recession.

A salute to the real men/women of genius.

1. The 20-something BMW-owning mortgage brokers working in the boilerroom of New Century Mortgage, and countless other subprime outfits.
2. The ratings agencies..S&P, Moody’s, Fitch, etc. Who collected huge fees while looking the other way and mis-rating mortgage and derivative securities.
3. Appraisers who buckled under pressure to “hit” the number.
4. Dishonest homeowners who fudged their income, job status, etc. “Hey everybody is doing it!”

The list is too long…..I can go on with 10 more..Real estate agents, Govt and failure of regulation, etc…

Venting done!

[Bubblesitter]

a little early morning venting…..

I would like to thank all you folks who now in your small little way helped plung the world into financial chaos and will probably put the US into a recession.

A salute to the real men/women of genius.

1. The 20-something BMW-owning mortgage brokers working in the boilerroom of New Century Mortgage, and countless other subprime outfits.
2. The ratings agencies..S&P, Moody’s, Fitch, etc. Who collected huge fees while looking the other way and mis-rating mortgage and derivative securities.
3. Appraisers who buckled under pressure to “hit” the number.
4. Dishonest homeowners who fudged their income, job status, etc. “Hey everybody is doing it!”

The list is too long…..I can go on with 10 more..Real estate agents, Govt and failure of regulation, etc…

Venting done!

[LA_Renter]

I have no idea how the markets will shake out today. The world markets are jitterey over this sub prime thing. i found this article which I thought helped explain some of the market moves as of late. This is an interesting read;

“Posted by Jim Kingsland at 10:07 PM

Dow Down 146, or Lesson Number 316 That Structured Credit REALLY Matters

Talk about a trading range today – about 300 points for the Dow and we nearly nearly tested upward resistance at S&P 1490 only to hit at brick wall at the 50 day moving average in the 1484 area and then see the index close down at 1455. C’mon did you really expect that all would be forgotten and that Friday’s low was a buying opportunity? There were a lot of ‘sparkies’ out there thinking that, apparently. This is not last February and a brief Shanghai stock market plunge. The market is dealing with some pretty complicated stuff that will make it hard for the short-attention-span people to keep from buying on every dip.

Last night I briefly ruminated that bad news in structured credit (eg. subprime), or corporate high yield credit would spur carry trade unwinding. It happened again today.

Let me be clear: Carry trade unwinding is driven in large part by the perception that risk taking ability is dropping here in the U.S. due to recent structured credit troubles.

There’s a lack of understanding concerning the above emboldened line. Why? Because there are too many folks blaming things like subprime, or LCDX exclusively for stock market declines and ignoring the carry trade, or citing the carry trade as the sole culprit for market declines. Rising risk aversion due to the mortgage meltdown and contagion into corporate high yield debt are intertwined with the carry trade.

It’s really a vicious and dangerous cycle because as more yen carry trade unwinding occurs there will come a trigger point when the Japanese yen rises enough for carry trade unwinding to go from orderly and voluntary to forced and disorderly. When carry trade unwinding takes on a disorderly life of its own it will then beget liquidation of whatever speculation it previously funded which would bring on further pressure to stocks and any other paper tied to speculative bets. It’s a financial super highway with lots of traffic, no speed limit and no center barrier. It’s this vicious cycle that one of these days bring us a 1,000 point down day for the Dow.

The risk game has always relied on the ability to take risks. Duh. How so many still fail to grasp that a meltdown in one risky area of the market can simply be “contained” (eg. subprime) and not impact risk in other areas, I’ll never know.”

Paulson just came out and said subprime is contained. Talk about looking like Baghdad Bob.

[LA_Renter]

I have no idea how the markets will shake out today. The world markets are jitterey over this sub prime thing. i found this article which I thought helped explain some of the market moves as of late. This is an interesting read;

“Posted by Jim Kingsland at 10:07 PM

Dow Down 146, or Lesson Number 316 That Structured Credit REALLY Matters

Talk about a trading range today – about 300 points for the Dow and we nearly nearly tested upward resistance at S&P 1490 only to hit at brick wall at the 50 day moving average in the 1484 area and then see the index close down at 1455. C’mon did you really expect that all would be forgotten and that Friday’s low was a buying opportunity? There were a lot of ‘sparkies’ out there thinking that, apparently. This is not last February and a brief Shanghai stock market plunge. The market is dealing with some pretty complicated stuff that will make it hard for the short-attention-span people to keep from buying on every dip.

Last night I briefly ruminated that bad news in structured credit (eg. subprime), or corporate high yield credit would spur carry trade unwinding. It happened again today.

Let me be clear: Carry trade unwinding is driven in large part by the perception that risk taking ability is dropping here in the U.S. due to recent structured credit troubles.

There’s a lack of understanding concerning the above emboldened line. Why? Because there are too many folks blaming things like subprime, or LCDX exclusively for stock market declines and ignoring the carry trade, or citing the carry trade as the sole culprit for market declines. Rising risk aversion due to the mortgage meltdown and contagion into corporate high yield debt are intertwined with the carry trade.

It’s really a vicious and dangerous cycle because as more yen carry trade unwinding occurs there will come a trigger point when the Japanese yen rises enough for carry trade unwinding to go from orderly and voluntary to forced and disorderly. When carry trade unwinding takes on a disorderly life of its own it will then beget liquidation of whatever speculation it previously funded which would bring on further pressure to stocks and any other paper tied to speculative bets. It’s a financial super highway with lots of traffic, no speed limit and no center barrier. It’s this vicious cycle that one of these days bring us a 1,000 point down day for the Dow.

The risk game has always relied on the ability to take risks. Duh. How so many still fail to grasp that a meltdown in one risky area of the market can simply be “contained” (eg. subprime) and not impact risk in other areas, I’ll never know.”

Paulson just came out and said subprime is contained. Talk about looking like Baghdad Bob.

[LA_Renter]

Bubblesitter,

I found this on a yahoo chat board for an HB. Since you were venting I thought you would appreciate this

“S&P etal

A while back A&E ran a program about a hit man from north Jersey named Kuklinski who developed a method for dispatching some of his victims by mixing a cocktail of potassium cyanide and DMSO (transfer agent) which allowed him to swab this mixture on the skin of the hapless target with the result that the cyanide went thru the epidermis and straight into the blood stream causing death in moments. Due to this it is now standard practice for medical examiners to test for tell tales of this pernicious practice as standard practice.
How does this relate to sub-prime you ask? Well the rank amateurs on this board have been screaming for at least the past two years about the poisonous dealings of the HBs and their pals in the finance world with total accuracy as to the outcome. The rating agencies knew what was going on and as the examiners of the fetid items presented to them they acted as the transfer agents allowing this toxin to be passed thru the skin of the financial markets as sweet investment grade candy. The point is that if we knew what was going on you know damn well that they did – the investment grade rating simply allowed them to sell junk bonds into a huge pool of of what should have been forbidden money. This was a scam from top to bottom and in my view the perps all knew it from the get go.”

These people seem a little too comfortable playing with dynamite in the global credit markets.

[LA_Renter]

Bubblesitter,

I found this on a yahoo chat board for an HB. Since you were venting I thought you would appreciate this

“S&P etal

A while back A&E ran a program about a hit man from north Jersey named Kuklinski who developed a method for dispatching some of his victims by mixing a cocktail of potassium cyanide and DMSO (transfer agent) which allowed him to swab this mixture on the skin of the hapless target with the result that the cyanide went thru the epidermis and straight into the blood stream causing death in moments. Due to this it is now standard practice for medical examiners to test for tell tales of this pernicious practice as standard practice.
How does this relate to sub-prime you ask? Well the rank amateurs on this board have been screaming for at least the past two years about the poisonous dealings of the HBs and their pals in the finance world with total accuracy as to the outcome. The rating agencies knew what was going on and as the examiners of the fetid items presented to them they acted as the transfer agents allowing this toxin to be passed thru the skin of the financial markets as sweet investment grade candy. The point is that if we knew what was going on you know damn well that they did – the investment grade rating simply allowed them to sell junk bonds into a huge pool of of what should have been forbidden money. This was a scam from top to bottom and in my view the perps all knew it from the get go.”

These people seem a little too comfortable playing with dynamite in the global credit markets.

[LookoutBelow]

I look at the govt as a "Father Figure" of the country, people are allowed to make their mistakes but when a group of shysters put together these weapons of mass financial destruction like we've seen in the credit industry coupled with wall streets pimping of these "stocks" CDO's, MBO's etc…etc….at that point the govt, in all of its infinite wisdom, experience and candor should and MUST protect the population and the country et al from these greedy, dangerous predators…But they didnt and NOW we have a HUGE failure that will ROCK the worlds economies…one must at least wonder if it was all pre planned ?….

The govt politicians (Congress and Senate) should be held personally and criminally liable for their negligence of enforcing laws that are ALREADY on the books….SEC turning a blind eye on their enforcement jobs comes to mind.

but who will watch the watchers ?

If the govt were analogously the parents of young, naive, vulnerable children, then they would be thrown in jail for child abuse and neglect…….

Who will hold their feet to the fire of their failures ? 

I'll tell you who, the American worker who's retirement pension or 401K was the "play money" that wall street used to cook up this scam for the last 5-6 years…….When 20 million people find out they will have to work as a "Wal Mart" greeter instead of tooling around the country in their motor home or gorging themselves on 24 hr buffets on cruise ships while leisurely traveling to places like the Bahamas…THEN there will be hell to pay……The collapse that is in inevitably coming, could be the start of a financial revolution. 

What do you think of this ?

How mad would YOU be if your suddenly broke and 62 yrs yrs old ?….

No retirement, minimal savings and no future prospects and OLD……dire straits indeed.

As the old Chinese proverbs states:.."May you live in interesting times" 

 Its gonna be damned interesting in the next several years amigo's

 

[LookoutBelow]

I look at the govt as a "Father Figure" of the country, people are allowed to make their mistakes but when a group of shysters put together these weapons of mass financial destruction like we've seen in the credit industry coupled with wall streets pimping of these "stocks" CDO's, MBO's etc…etc….at that point the govt, in all of its infinite wisdom, experience and candor should and MUST protect the population and the country et al from these greedy, dangerous predators…But they didnt and NOW we have a HUGE failure that will ROCK the worlds economies…one must at least wonder if it was all pre planned ?….

The govt politicians (Congress and Senate) should be held personally and criminally liable for their negligence of enforcing laws that are ALREADY on the books….SEC turning a blind eye on their enforcement jobs comes to mind.

but who will watch the watchers ?

If the govt were analogously the parents of young, naive, vulnerable children, then they would be thrown in jail for child abuse and neglect…….

Who will hold their feet to the fire of their failures ? 

I'll tell you who, the American worker who's retirement pension or 401K was the "play money" that wall street used to cook up this scam for the last 5-6 years…….When 20 million people find out they will have to work as a "Wal Mart" greeter instead of tooling around the country in their motor home or gorging themselves on 24 hr buffets on cruise ships while leisurely traveling to places like the Bahamas…THEN there will be hell to pay……The collapse that is in inevitably coming, could be the start of a financial revolution. 

What do you think of this ?

How mad would YOU be if your suddenly broke and 62 yrs yrs old ?….

No retirement, minimal savings and no future prospects and OLD……dire straits indeed.

As the old Chinese proverbs states:.."May you live in interesting times" 

 Its gonna be damned interesting in the next several years amigo's

 

[Author]

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