Fleck's Denialists & The Mother of All Bailouts
From Flecks latest Be Alert For US Market Chaos... and sounding very much like the Nattering One indeed...
The nation's economy is getting worse, not better, and the 'denialists' are about to get a big, fat wake-up call.
Economic growth in the U.S. is either nonexistent or negative.
I don't know when the reality of our hobbled economy will dawn on the "denialists."
The Mother of All Bailouts... it is reported that the Treasury will provide up to $200 billion in capital for Fraudy (FNMA) & Phony (FHLMC).
No guarantee on the preferred or common stock, of which the US taxpayer will be issued preferred stock to...
put a guarantee on the $5.1 billion in debt held by banks, insurance cos, pension funds & foreign central banks around the world. Isn't that extra special?
Pimco's Bill Gross (the prime beneficiary of the bailout) said on CNBC that the bailout could cost the government $50 billion.
Word to the wise: Just multiply Gross's number by 10X and that will be the real cost.
We estimated earlier this year that raising FHA, FHLMC & FNMA loan limits from $417K to $729K will cost the taxpayer $360 billion in failed liar loans.
How? In 2005, stupid flipping speculator bought at $800K with greedy banks loan and put $40K down, financed with interest only neg am balloon ARM.
(5% is being overly generous as most of these loans were NO DOWN! and STATED INCOME!)Real value is currently underwater at $600K and the MLS can't sell it.
(Once again being very generous as some areas like Lee County, Florida are 70% off peak value, meaning $800K peak value is now $240K.)
The borrower had been making the interest only payments, and before the last bump which would have put them over and out, was given a forebearance the last six months.
So their credit still "looks good" and GSE refi's to pay off bank caught holding $760K liar loan.
Bank writes down negative am build, money they never had to start with, and gets huge tax benefits.
Borrower qualifies but still can't sell it and defaults after another year.
GSE takes it back, sells it at a deflated $500K value, less $100K expenses, thats a -$360K loss.
Multiply $360K by a million of these loans, You get the idea... thats a conservative $360 billion tab the taxpayer will get caught holding.
And the stock markets rallied big on this "great news", absolutely incredible.
The nation's economy is getting worse, not better, and the 'denialists' are about to get a big, fat wake-up call.
Economic growth in the U.S. is either nonexistent or negative.
I don't know when the reality of our hobbled economy will dawn on the "denialists."
The Mother of All Bailouts... it is reported that the Treasury will provide up to $200 billion in capital for Fraudy (FNMA) & Phony (FHLMC).
No guarantee on the preferred or common stock, of which the US taxpayer will be issued preferred stock to...
put a guarantee on the $5.1 billion in debt held by banks, insurance cos, pension funds & foreign central banks around the world. Isn't that extra special?
Pimco's Bill Gross (the prime beneficiary of the bailout) said on CNBC that the bailout could cost the government $50 billion.
Word to the wise: Just multiply Gross's number by 10X and that will be the real cost.
We estimated earlier this year that raising FHA, FHLMC & FNMA loan limits from $417K to $729K will cost the taxpayer $360 billion in failed liar loans.
How? In 2005, stupid flipping speculator bought at $800K with greedy banks loan and put $40K down, financed with interest only neg am balloon ARM.
(5% is being overly generous as most of these loans were NO DOWN! and STATED INCOME!)Real value is currently underwater at $600K and the MLS can't sell it.
(Once again being very generous as some areas like Lee County, Florida are 70% off peak value, meaning $800K peak value is now $240K.)
The borrower had been making the interest only payments, and before the last bump which would have put them over and out, was given a forebearance the last six months.
So their credit still "looks good" and GSE refi's to pay off bank caught holding $760K liar loan.
Bank writes down negative am build, money they never had to start with, and gets huge tax benefits.
Borrower qualifies but still can't sell it and defaults after another year.
GSE takes it back, sells it at a deflated $500K value, less $100K expenses, thats a -$360K loss.
Multiply $360K by a million of these loans, You get the idea... thats a conservative $360 billion tab the taxpayer will get caught holding.
And the stock markets rallied big on this "great news", absolutely incredible.
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