Misery Economic Theater 2011

[Christenson]

Carlessness strikes!!!

[ewmayer]

Markets rallying hugely today on the latest "hopeful quotes pointing to decisive action soon - stay tuned for details which will likely be lacking" blather from European heads of state:

Merkel, Sarkozy Pledge Bank Recapitalization

Angela Merkel and Nicolas Sarkozy, racing to stamp out the euro debt crisis threatening to engulf the financial system, gave themselves three weeks to devise a plan to recapitalize banks, get Greece on the right track and fix Europe’s economic governance.

“By the end of the month, we will have responded to the crisis issue and to the vision issue,” the French president said in Berlin yesterday at a joint briefing with the German chancellor before they dined at her office.

My Comment: [In your best Money-Python taunting-French-knnniggits accent] [i]"Ah, yeah - you know, we gonna feex dat whole 'Your-o-peen debt crisees' deal and Ah gonna show you mah pocket bazooka stuffed full-a da 'vision' you been buggin` me about, OK, mon amis?" added Mr. Sarkozy, testily. When another reporter raised her hand to ask a question, Mr. Sarkozy, visibly angry, said peremptorily, "I don't want to talk to you no more, you empty headed animal food trough wiper. I fart in your general direction. Your mother was a hamster and your father smelt of elderberries", and then stormed off, leaving a trail of paper-clutching aides and astonished reporters in his wake.

In Kodak's troubles, a snapshot of an icon's fall

In Kodak's troubles, a snapshot of an icon's fall: ROCHESTER, N.Y. -- Buffeted by foreign competition, then blindsided by a digital revolution, photography icon Eastman Kodak is fighting for survival after a quarter-century of failed efforts to find its focus.

131-year-old company that turned picture-taking into a hobby for the masses and became singularly synonymous with capturing memories has tried to bat down sudden talk of bankruptcy. But concern about its grim prospects has hit fever pitch after it enlisted a legal adviser to explore ways to revive its sagging fortunes.

The collapse of such a legendary brand would not only reverberate through American business, but would also have a profound cultural effect on generations worldwide who took their first snapshots with film cameras bearing the unmistakable yellow-and-red K logo.

"You could look up and see that yellow sign all over the world -- no matter where you went, people depended on that for their memory-recording," said photography writer John Larish, who worked for Kodak in the 1980s as a senior market-intelligence analyst.

"With the advent of digital or even cellphone cameras, Kodak wasn't in the game," he said. "I see the company now as something we will write about in history books."

Already jittery shareholders were rattled late last month when word leaked out that Kodak has hired Jones Day, a law firm that dispenses advice on bankruptcies and other restructuring options. Its stock, which topped $94 in 1997, skidded to an all-time low of 78 cents a share.

After markets closed Sept. 30, Kodak insisted in a statement that it had no intention of filing for bankruptcy protection and described Jones Day as one of several advisers helping its management close out a stumbling, decade-long drive to recast itself as a digital photography and printing powerhouse. Its stock rebounded Thursday to $1.45.

But investor alarm about whether it has the financial wherewithal to complete its turnaround is raising the seemingly inescapable specter of job cuts -- and the threat of extinction. Kodak has already sliced its global payroll to 18,800 from a peak of 145,300 in 1988, and its hometown rolls to 7,100 from 60,400 in 1982. Employees say they're even more scared than usual that the latest crisis could sink careers that somehow dodged decades of cutbacks.

My Comment: But it`s not just old-tech dinosaurs like Kodak which are victims of the rapid pace of change in the broader wired/digital universe...as I write this, Sprint/Nextel looks be on the ropes, as well, having suffered a series of major mis-steps which are now being compounded by a cash crunch just as corporate credit markets are seizing up. To think how immensely cheaper it would have been to raise cash in the corporate-debt markets a year ago, when even junk-bond yields were unbelievably low as everyone and their brother was yield-chasing with reckless abandon.

And speaking of "missing the window":

Netflix kills plan to split off DVD rentals

NEW YORK -- Netflix generates more head-scratching plot twists than a cheap B-movie.

On Monday, the company said it would reverse a previously announced decision to put its DVD-by-mail and Internet streaming services on separate websites, a plan that was widely derided by Netflix subscribers.

People will be able to use both services under one account and one password, CEO Reed Hastings said Monday in a blog post.

Netflix Inc., however, plans to stick to pricing plans introduced in June, which means subscribers are now paying separately for streaming service and mailed DVDs. That change amounted to a price increase for most subscribers.

Investors saw the reversal as an Oscar-worthy move, sending the stock up $7.68, or 6.6 percent, to $124.89 in midmorning trading after rising as high as $128.50.

My Comment: “OK, so we changed our mind about making you manage 2 separate accounts in place of the 1 you used to have … but we’re gonna charge you the new, higher rate for the privilege. Are we customer-friendly, or what?”

I sense this is too little, too late – a tremendous amount of customer-loss and horrible-PR damage has already been done, and others (e.g. Dish) are aggressively moving into the DVD-by-mail+streaming-download space, and are specifically targeting a price point similar to what NFLX used to charge.

And the Academy appears to be re-thinking that "Oscar-worthy move": NFLX has since sold off hard, now down below $110, which is more than 7% *below* its Friday close.

[ewmayer]

Companies use fuzzy math in job claims; candidates still buy in

In an ad that has blanketed radio airwaves in the Washington region, a woman’s voice gently intones, “Imagine .?.?. one million new jobs.”

“One million new American jobs,” echoes a man. “One million new opportunities to build a career,” says the woman.

“Support a family.”

“Follow your dreams.”

And where will these “one million new jobs” come from? By expanding oil and gas drilling and building new pipelines, says the American Petroleum Institute, an industry lobbying group that paid for the ad campaign, which also has featured in newspapers, on television and on Metro platforms.

Oil companies aren’t the only ones promising jobs if Washington gives them their way. A wide array of businesses are saying they can help solve the country’s unemployment crisis if only the government would roll back some regulations, approve their big mergers or lower their taxes.

Yet the industry often touts debatable jobs numbers. Mergers between big companies, for instance, tend to result in layoffs rather than new positions overall. And a closer look shows that API’s ads exaggerate the effect that looser drilling policies would have on employment; more than half of its projected job growth would come between 2015 and 2030.

Nonetheless, some policymakers and presidential candidates have cited these statistics as they echo companies’ claims about creating jobs.

Hey, never let "ugly subjective facts" get in the way of a good narrative, I say.

“We just learned today that if the federal government would pull back on all of the regulatory restrictions on American energy production, we could see 1.2 million jobs created in the United States,” Rep. Michele Bachmann (Minn.) said at a Sep. 7 Republican presidential debate.

Never mind that most of those will be related to toxic spill cleanup - a job is a job, let`s not get distracted by arcane details, OK?

In a letter last month to the Justice Department, 100 lawmakers defended the merger between AT&T and T-Mobile, repeating the companies’ argument that the government’s lawsuit to stop the deal on antitrust grounds would “thwart job creation and economic growth.”

And a central element in the economic plans of other Republican presidential candidates, such as Mitt Romney and Rick Perry, is to roll back “job-killing” regulations to spur hiring.

“It’s really hard if you’re against regulation to let a good crisis go to waste, and right now we have high unemployment,” said Roger Noll, an economics professor at Stanford University and co-director of the school’s program on regulatory policy. “You can use the current economic condition as a Trojan horse.”

The horses come in different shapes. The coal industry is running ads that show working people weighed down by regulation-filled briefcases being violently thrown from broncos in a rodeo. A new study commissioned by environmental groups, however, says that regulation of coal ash disposal would actually create jobs.

Other company numbers also become fuzzy upon examination.

Big company mergers are widely known to lead to job losses in the short term as firms seek savings, or “synergies” in merger jargon. But that has not stopped AT&T and Capital One, whose proposed mergers have raised antitrust scrutiny, from saying that their acquisitions will result in more jobs.

AT&T has been running a television ad showing its employees hard at work and consumers enjoying their wireless phones and tablets. The ad says that if the merger with T-Mobile is approved, AT&T will bring back 5,000 jobs that were outsourced overseas. It also says the merger will create investment in broadband that would create “as many as 96,000 jobs.”

The latter number comes from a study by the Economic Policy Institute looking at the employment benefits of the $8 billion AT&T has promised to plow into broadband investment should the deal be approved in court. EPI concluded that such an investment would yield 55,000 to 96,000 new jobs over seven years.

In "One Million Jobs", the American Petroleum Institute, an industry lobbying group, gives its take on how to create one million jobs.

In this TV spot, AT&T claims that its proposed merger with T-Mobile will create more jobs. But the EPI study does not address whether the merger would ultimately result in more jobs — after factoring in potential layoffs.

AT&T has said it expects to save $3 billion annually from the deal but has not explained whether that would include job cuts. An AT&T spokesperson said that the company expects to keep all of its call-center jobs and that most of the reduction in the company’s workforce would come from attrition rather than layoffs.

My Comment: "Of course we`re moving the call centers to India, but current call-center employees will be encouraged to uproot their families and move there as well, where admittedly their wages will be slashed by 90%, but you can buy a lot more with a dollar in India than you can in the U.S., so their purchasing power will actually skyrocket! We are doing our U.S. employees a favor by giving them a new life in a high-growth economic boom zone. We should be applauded for our altruism here, folks."

The article uses the word “debatable” to describe the jobs claims – I think that is a synonym for “laughably, hilariously overstated”. Oh, wait – you got the number right but the sign wring? Well, clearly that’s a mistake anyone could make.


And a little humor to lighten your day, involving a famous long-running American newspaper reader-humor contest:

Wikipedia: The Washington Post Style Invitational

The Style Invitational kicked off in March 1993 by asking readers to come up with a less offensive name for the Washington Redskins. The winner, published two weeks later, was Douglas R. Miller, with the entry "The Baltimore Redskins. No, don't move the team, just let Baltimore deal with it." He won a Timex watch like the one President Bill Clinton wore at the time, and apparently never entered again, as he wanted to retire undefeated. The second week's contest was to replace the state of Maryland's slogan "Manly deeds, Womanly words" and yielded up such responses as "Maryland - Home to its residents" and winner "Maryland - Wait! We can explain!" by Oslo. He won an as yet unpurchased large kitschy crab sculpture/decoration, but traded it for a Timex watch like the one President Bill Clinton wore at the time. Another early contest asked entrants to help choose a better nickname for Washington, D.C., to replace "A Capital City". Exemplifying the S.I.'s irreverence, the winning entry was "A Work-Free Drug Place".

[ewmayer]

A Silicon Valley resident describes why he joined OWS - I could not have said it better myself:

David Smathers Moore: Let down by Obama, people seeking change flock to the 'Occupy' movement

In October 2008, my wife and I loaded our 6-month-old baby into her car seat and drove six hours to Reno. As 40-something new parents, a weekend road trip to walk precincts for a presidential candidate was not convenient or easy. But when we arrived at the staging ground for volunteers, we were rewarded by an inspiring sight: The line to sign in snaked through a parking lot the length of two football fields. Barack Obama's candidacy had inspired a lot of people to participate in their democracy.

What I most liked about Obama was the independence and intelligence reflected in his position, taken five years earlier when it was not politically expedient, to oppose the Iraq invasion plans well before they had been put into motion. In 2008, as a terrifying financial crisis was unfolding, Obama seemed to have the combination of sound judgment and courage that our country needed in the White House. It seemed reasonable to hope that he might become an FDR-for-our-time who would hold people accountable and get us back on a path toward shared prosperity.

But three years later, not one executive from a major firm involved in the 2008 disaster has been prosecuted. On the contrary, Obama hailed the CEO of the firm that most personified the abuses -- Goldman Sachs -- as a "savvy businessman." But the rest of us continue to be punished for their crimes. We are losing homes, watching our retirements vaporize and struggling with long-term unemployment.

And those least responsible, the young, will ultimately pay the most.

To lead us forward, Obama also needed to explain to the country how wealth and power had become more and more concentrated over several decades and how that trend had reached a critical point at which it was cannibalizing our economy and corrupting our democracy. He needed to put forth a vision for how we would take our country back from the 1 percent that has only continued to amass wealth and power. But such leadership never materialized.

So a few weeks ago, my wife, daughter and I set out on another civic journey. This time the little one was riding her trike as we walked to a park in our neighborhood where about 80 people came together to form Occupy San Jose, a local affiliate of the Occupy Wall Street movement. Similar organizations are popping up in cities across the country. A group of De Anza College students facilitated the process as we self-organized into committees to carry out a long-standing American tradition: taking a direct nonviolent stand for justice when the ordinary mechanisms of politics and accountability have failed.

The Occupy Wall Street movement is leaderless and to date has not formulated specific demands. This is pure brilliance because our first task, in my view, is simply to name publicly what many of us have felt privately: that the system itself has been hijacked. We are coming out of the woodwork and connecting with each other in a regenerative democratic process. As we collectively find our voice and our numbers grow, concrete solutions will eventually emerge. Such is our civic faith.

So if you are angry that the big financial institutions gambled away trillions of dollars only to be bailed out by us, the taxpayers, without any real accountability for their actions, then you are a part of this movement. If it doesn't sit right with you that wealth continues to be concentrated in fewer and fewer hands and that corporations now have more political power than we the people, then I will see you down at City Hall plaza.


DAVID SMATHERS MOORE lives with his wife and daughter in downtown San Jose. He wrote this for this newspaper.

[ewmayer]

Pennsylvania State Capital Files for Bankruptcy

Harrisburg, Pennsylvania, facing a state takeover of its finances, filed for bankruptcy protection after failing to pay the debt on a trash-to-energy incinerator.

The council made its 4-3 decision against the advice of a city attorney who said the panel did not follow proper procedure. It was the ninth bankruptcy filing this year by a municipal-bond issuer, according to James Spiotto, a partner at Chapman & Cutler in Chicago who tracks such cases.

“This was a last resort,” Mark D. Schwartz, the council’s Bryn Mawr-based lawyer, said after he faxed the documents to a federal court yesterday. “They’re at their wits’ end.”

Harrisburg would be the biggest city bankruptcy since Vallejo, California, filed in 2008, according to a ranking by Municipal Market Advisors, a research firm in Concord, Massachusetts. Municipalities across the nation have been battered by the financial crisis. Harrisburg’s filing came less than a month after Alabama’s Jefferson County Commission voted to try to avert what would the nation’s biggest municipal bankruptcy, and nine months after Vallejo emerged.

While Chapter 9 bankruptcy, named for the section of federal law that governs insolvent municipalities, would mean the loss of state aid under a law passed in June, it would be better than pain caused by a state-imposed recovery plan, said Councilwoman Susan Brown-Wilson.

“We’re not incompetent,” Brown-Wilson said. “We’re just not going to let you run us over with the train anymore.”

Bond Markets Flashing Warning Signals

Lee Adler, the long-time eagle-eyed (pardon das pun, bitte) treasury-debt-market guru of the online Wall Street Examiner has a piece out noting some very unusual recent action in USGB markets:

Threads In A Foreboding Tapestry

Ironically, the US bond market was rescued by the European sovereign debt and bank meltdown, so it appeared for a while that Dr. Bernankenstein might be right and his monster experiment would be vivified on its own. The European panic triggered massive capital flight that ended up, where else, flooding into the US, mostly into purchases of Treasuries. Not only could the monster walk on its own, it could actually fly! Once again the Treasury market benefited benefited from an unusual subsidy, this one driven by fear. Bond prices flew into the stratosphere with yields sinking to record lows.

About 6 weeks ago, something changed. [Foreign Central Banks] not only slowed their buying of Treasuries, they stopped altogether, reversed course and actually began selling them. Three weeks ago their selling reached a level that I characterized in my weekly Treasury update for subscribers as "dumping." It was simply unprecedented. I opined that this could be the beginning of the end of the Treasury bull market, in spite of any effect that the Fed's new Operation Twist might have.

In fact, I expected that effect to be nil, and it has been. If anything, the announcement of Operation Twist, where the Fed offered to buy long term Treasuries from the Primary Dealers while simultaneously selling them short term paper, rang a bell for some investors. The Fed's announcement told them that the time had come to sell their long term paper. If the Fed was buying, they decided that they would be glad to sell. Today, the yield on the 10 year Treasury note rose to 2.16%. That's up an astonishing 44 basis points since last Thursday's open.

Every other day, the Treasuries open on a huge gap. They are trading more like pork bellies than stodgy government bonds. Worst of all, the yield on the 10 year is up approximately 45 basis points since the low in yield reached the day after the Fed announced Operation Twist. Bernanke has egg all over his face. The man simply does not understand financial markets. And this move does not look like a fluke. As a result of today's market, the yield on the 10 year has broken out of an intermediate term base. Unless yields pull back immediately, the implication is that the intermediate term target is 2.50. Meanwhile, Bernanke had assured investors that long term yields would fall as a result of his doing the Twist.

Apparently, the FCBs were among those who took the Fed's announcement as a sell signal. They are selling at the heaviest pace in the 9 years that I have been tracking this data. Normally, prior to the last 5 weeks, the instances when they were actually net sellers were few and far between. What has been going on here lately is no less than a sea change.

Making matters worse is that the Primary Dealers have also become massive sellers of Treasuries and all manner of fixed income paper in recent weeks. This chart of the Primary Dealer fixed income holdings is posted weekly in the Wall Street Examiner Professional Edition Fed Report. This data is released with a 10 day lag, so we only have data through September 28, but given the market action this week, this trend is certainly continuing.

The dealers appear to be in trouble. They began selling off their fixed income paper of all types in early September. That accelerated to what I can only characterize as wholesale dumping in the weeks ended September 21 and 28. It is no coincidence that those where the weeks where we began to see yields reverse from their record run.

These are troubling developments, not just for their implications for the bond market, but for what they imply about the health of the backbone of the US financial system--the Fed's Primary Dealer (PD) network. If the Fed is the head, these guys are the spinal cord. Isolating on just their corporate bond holdings the picture becomes even more troubling. If major corporations are supposedly doing so well and their balance sheets are in such great shape, why did the PDs not accumulate their fixed income securities throughout the equities bull market of 2009 and 2010? And especially why have they been frantically dumping their corporate holdings since June?

Something is rotten here. These are signs of major systemic stress.

My Comment: One wonders if the above-described bond-market signals will prove a more-reliable indicator of systemic (di)stress than last year's "Hindenburg Omen". The latter was based on equity markets, which can act bizarrely enough even absent massive distortions resulting from government intervention and ongoing HFT-price-manipulation attempts, whereas the (much larger and sober-minded) bond markets should serve as better coal-mine canaries. But like the stock markets, the bond markets are also currently the subject of unprecedented (at least in the pre-2008-crisis sense) government and central-bank interventions, so we shall see.

Meanwhile, the 2-week-long short-covering-fueled ramp in US and European equity markets lives for another day ... up and up and up it goes, when `twill reverse, nobody knows. (But there appears to be a bit of last-gaspishness about the rally this week). Mish notes that markets appear to be liking the latest "nothing is fixed, but everything will be solved soon, once we find a magic solution" news out of Europe.

[ewmayer]

Denninger (in between rants) has a pair of quality posts this weekend:

This first one gets a bit technical, but is a great example of application of conservation laws in the modern-monetary-system context:

The $3.3 Trillion Bank Bailout

The next one is a reply to a truly bizarre (but apparently widely circulating) right-wing meme that by way of the 2008 government TARP bailouts (quote is KD's words) "The banks were "extorted" into taking money by an overbearing government, and but for that extortion they would have all been just fine":

TARP, Revisited

It's July 2008. You are a "TBTF" bank CEO. You've been running a 30 year ponzi scheme using ever-increasing amounts of debt while GDP has languished in roughly the same place for the last two decades in terms of numerical growth. In the 3rd Quarter of 2007, when the S&P 500 hits 1576 and the DOW tops, the economy put about six times the amount of debt into the system as there was GDP growth, and at that point GDP had started to roll over. It had an obvious geometric progression look to it but only a few people in the blogosphere had been hollering about it. You wondered how much longer it was going to be before the people woke up.

Over the next three quarters from the 3Q 2007 GDP has actually gone negative. Debt demand has cratered and is down by almost 50%. The handwriting is on the wall; credit creation is going to go negative too.

You have tens of trillions of dollars in credit instruments on and off your balance sheet and things are looking pretty bad. You're getting pestered by people who see the credit contraction and start asking if you're good for those swaps, and the credit default swaps on your bank are blowing out. They have a point too: If credit demand actually goes negative, you're dead. You're geared at 30:1 which means you can only lose $3 out of every $100 of alleged "value" of your assets before you're broke. The collateral calls alone on the more than $30 trillion in swaps are enough to kill your capital several times over should this occur.

See, that's the nature of a pyramid. It all looks ok right up until demand starts to reverse. Then it works in reverse, just like it did on the way up. What made you $30 for every $1 of actual capital you had now loses $30 for every dollar of capital. Attempting to fire-sale assets to avoid the disaster simply tells everyone in the market you're busted and they'll pile in short, destroying your stock price and further widening the CDS. Too much of that and what you're trying to prevent will happen anyway.

Your morning includes one less coffee as you don't need any more jitters than you already have, and your evenings have an extra scotch or two before going to bed.

Then the phone rings. It's one of your Vice-Presidents; he is responsible for, among other things, your repo desk. One of your traders just came into his office and is as white as a ghost: Lehman has no collateral - they're bankrupt.

You collapse into your chair, dropping your coffee mug on the marble floor, which shatters into a hundred pieces. If your repo desk knows this so does the NY Fed, headed by Tim Geithner. That means Bernanke knows. It also means every other firm on the street knows. You look at the CDS for Lehman on your Bloomberg and shudder.

The very nightmare that has woken you almost nightly for six months has begun.

Note this well: It's July 31st 2008, or quite some time before anyone else outside of "TBTF" banks will know Lehman is about to fail. Oh sure, there have been rumors since Bear went down, but that's all they've been. Lehman's stock is trading at $17, and has been reasonably stable for a couple of weeks. It was as low as $12 two weeks previous and looked like it was headed to zero, but then stabilized and recovered by almost 50%. CNBC is chattering on a daily basis of rumors of all sorts but the market has actually been improving for a bit in tone. The VIX, which was just shy of 31 two weeks ago, is now trading at 23.

You thought maybe - just maybe - it was going to be ok.

Now you know factually that it's not.

You call your equity desk and ask them to start quietly shorting Lehman's stock. Not in size - you don't want anyone to figure out what's going on "outside" of those who already know. You figure that everyone else in the TBTF club knows this too; there's no way they couldn't. But you're cautious - while you know how much trouble you're in if credit demand doesn't turn around fast you also know that Fuld had dinner with Paulson in April - just three months ago and that there were rumors flying around that Paulson "loved" their capital raise. It didn't make sense that in just three months they had no collateral for a routine overnight repo transaction!

The rest of the world will not know, of course, for a while yet that Lehman has effectively already detonated. In fact for the entire next month the S&P 500 will actually trade up about ten points, from 1267 to 1277 in a choppy, directionless pattern.

During the next month credit demand doesn't move much.

Then "it" happens. Lehman files.

Suddenly the collateral calls begin in earnest. Credit demand takes another leg down and GDP prints negative. You're now in the hole and there's no way out. The only good news is that everyone else in the TBTF club is in there with you - hundreds of trillions of dollars of swaps, from interest rate to CDS to god-knows-what-else that was bespoke by this person or that, and they all want collateral as your credit condition is wildly deteriorating and your own CDS quote looks like the peak of Mt. Everest on the upside. Your stock price is falling like a stone and the bond desk is telling you they're getting bid lists by the dozens from people trying to liquidate to save themselves but there are no bids at any price.

In the middle of all this you get called to Treasury for a meeting. TARP has just passed and Hank and Ben want to talk with you and the rest of the TBTF CEOs. You have your assistant call the hanger and get the jet ready.

When you arrive you figure you're being nationalized. You're done and you know it. There's nowhere for you to go; there's no bid at any price for some of your assets and for those where you can get a bid the loss will wipe you out. You have CDS on some of your exposure but you're pretty sure the counterparties don't have the money -- after all, you know you can't cover everything you wrote if push comes to shove. The simple fact is that an exponential contraction of credit demand into 30:1 leverage is not survivable. You can protest all you want, but it doesn't matter; the math is going to win as the collateral calls will eventually chew up all your cash while the ratings agencies ratchet you down. With only $3 of capital behind every $100 on your book there's just no way to make the math work, the bond market is effectively shuttered with the door bricked over and trying to raise equity capital into a crashing stock market is a fools game. Even if you could get an offering off, which you can't, the interest rate on bonds would be north of 10% and the dilution on a stock offering would be hideous, never mind that you simply couldn't raise enough money going that route. The bottom line is this: There's no way to make money when you have to borrow at that price, and all banks borrow in order to lend.

When you get to DC Hank and Ben are in the room and they're smiling. You figure that the call to the board is going to end with you sending your assistant in to start boxing up your office, but when you all get there the mood is a bit different.

[garo]

Super post by Karl and a nice antidote to the shit that the likes of Andrew Sorkin have been putting out.

[Fusion_power]

If I have distilled that correctly, it means the TBTF banks have transferred 3.3 Billion in toxic mortgages to Fannie Mae and/or Freddie Mac. Anyone care to bet that they transferred them at full value?

DarJones

[Christenson]

Originally Posted by Fusion_power

If I have distilled that correctly, it means the TBTF banks have transferred 3.3 Billion in toxic mortgages to Fannie Mae and/or Freddie Mac. Anyone care to bet that they transferred them at full value?

DarJones

Only if I can bet a bridge in Brooklyn, made by none other than the great John Roebling himself, and often offered for sale.....

[only_human]

Originally Posted by Fusion_power

If I have distilled that correctly, it means the TBTF banks have transferred 3.3 Billion in toxic mortgages to Fannie Mae and/or Freddie Mac. Anyone care to bet that they transferred them at full value?

DarJones

Billion, Trillion; Tragedies and statistics.

[R.D. Silverman]

Originally Posted by garo

Super post by Karl and a nice antidote to the shit that the likes of Andrew Sorkin have been putting out.

Yep.

So what has caused the recent climb in equity markets???