A Lot More "Name Brands" To Come
We have often Nattered about what would happen to reserve levels as home & stock values declined, while debt got downgraded.
Its happening, in spades due to- as the IMF put it - "a collective failure."
The International Monetary Fund said...
Financial losses stemming from the U.S. subprime-mortgage collapse may approach $1 trillion, citing a "collective failure" to predict the breadth of the crisis.
Last week we warned: "Keep your eyes peeled to the sky, it could be a name brand".
Bailouts to date, as predicted: Countrywide, Bear Stearns, now WaMu, next Lehman Brothers and possibly UBS.
As stated before, this dead man will really get shoved over the cliff, when the mortgage insurance co's go BK.
With no safety net or cushion in the form of MI loan payoffs,
the lenders will be forced into a fire sale of their REO assets and real estate prices will collapse.
I keep hearing the cheerleaders saying "all is well, don't worry, the end is near, the bottom is in sight".
With the economy going into negative growth along with jobs and no durable activity to fall back on...
this sounds like another "collective failure" and misdirect in the "confidence" game to me.
Get ready folks and get very defensive and as liquid as possible.
If you think this thing is over, guess again, our journey to the dark side, we've only just begun.
We are yet to be wrong, and like we've been saying all along, and we are in good company, the worst is yet to come.
As the Bank holding companies including Citigroup, Bank of America and Wells Fargo have the thinnest safety cushion against losses in seven years.
Credit ratings on $704 billion of bonds have been cut this year following the collapse of the U.S. housing market.
Last week, Sheila Bair, current chairman of the FDIC Federal Deposit Insurance Corp:
downgrades may compromise bank capital ratios enough that some of the largest institutions will no longer be considered well capitalized.
L. William Seidman, FDIC chairman 1985 to 1991:
"All I know is the first-quarter reports are going to be pretty bad, and there's a lot more to come."
William Isaac, FDIC chairman 1981 to 1985: "This is a nightmare for the country.
Banks will "raise what capital they can, then they'll slow down their growth and stop lending, and what should be a mild recession becomes a much more serious one."
Hattip to Bloomberg.
Its happening, in spades due to- as the IMF put it - "a collective failure."
The International Monetary Fund said...
Financial losses stemming from the U.S. subprime-mortgage collapse may approach $1 trillion, citing a "collective failure" to predict the breadth of the crisis.
Last week we warned: "Keep your eyes peeled to the sky, it could be a name brand".
Bailouts to date, as predicted: Countrywide, Bear Stearns, now WaMu, next Lehman Brothers and possibly UBS.
As stated before, this dead man will really get shoved over the cliff, when the mortgage insurance co's go BK.
With no safety net or cushion in the form of MI loan payoffs,
the lenders will be forced into a fire sale of their REO assets and real estate prices will collapse.
I keep hearing the cheerleaders saying "all is well, don't worry, the end is near, the bottom is in sight".
With the economy going into negative growth along with jobs and no durable activity to fall back on...
this sounds like another "collective failure" and misdirect in the "confidence" game to me.
Get ready folks and get very defensive and as liquid as possible.
If you think this thing is over, guess again, our journey to the dark side, we've only just begun.
We are yet to be wrong, and like we've been saying all along, and we are in good company, the worst is yet to come.
As the Bank holding companies including Citigroup, Bank of America and Wells Fargo have the thinnest safety cushion against losses in seven years.
Credit ratings on $704 billion of bonds have been cut this year following the collapse of the U.S. housing market.
Last week, Sheila Bair, current chairman of the FDIC Federal Deposit Insurance Corp:
downgrades may compromise bank capital ratios enough that some of the largest institutions will no longer be considered well capitalized.
L. William Seidman, FDIC chairman 1985 to 1991:
"All I know is the first-quarter reports are going to be pretty bad, and there's a lot more to come."
William Isaac, FDIC chairman 1981 to 1985: "This is a nightmare for the country.
Banks will "raise what capital they can, then they'll slow down their growth and stop lending, and what should be a mild recession becomes a much more serious one."
Hattip to Bloomberg.
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