Freddie Mac and Fannie Mae

[meazza]

http://www.ft.com/cms/s/0/5773a770-5106-11...0077b07658.html

[Chef Jim]

No, that's not correct. I recently sold my F350 dually that I used to pull the 5th Wheel I recently sold. I took the equity and invested it in silver. I am also for the immediate future going to divert the money that goes into my savings twice a month and begin purchasing silver vice placing it in my regular savings account. I have not touched my regular savings nor have I withdrew any of my CD accounts. When I said I was buying it as a hedge, I wasn't bullschitting. I haven't touched my IRA's, TSP or 401k and have no plans to.

 

I personally do not think that metals have come close to peaking. You may feel differently and are free to place your bets accordingly. The way the Fed keeps making money I think we're in for serious inflation which coupled with the bear market and real estate being in the schitter makes fertile conditions for metals to continue grow in price.

 

That's my bet. Why do you think cash is my best bet right now?

 

Cash is your best bet for your short term money (now to two years out) as it always it. I mean MM or CDs. If you still have six months of fixed expenses in cash you're ok. I just misunderstood and it sounded like to put all your cash in silver.

[East Brady]

"The market will get the chance to express its views on Paulson plan today when Freddie begins marketing $3bn in short-term debt. Wall Street bankers said Treasury officials had been in touch with big investment and commercial banks to ensure they were still considering placing bids for the bond sale." FT.

 

In other words Pauley Paulson TOLD the big boys they'd better be buying the bonds or the chit would hit the fan!

I hear Benny has the choppers all loaded and ready to hit the skies first thing Monday morning. What a great system, think I might buy some more silver tomorrow morning and kick back for the next couple months, increasing the cash supply 23+ percent per year is going to be reaaaal good for the real macoys.

[SD Jarhead]

http://www.ft.com/cms/s/0/5773a770-5106-11...0077b07658.html

 

Goood Times!

[SD Jarhead]

Just a thought... You know historically... What do you think would be taking place right now if it wasn't 2008, but 1908?

 

Would our country be weathering (for lack of better word) such an economic mess without wild public unrest?

 

Of course times are different and one is never able to fully compare. Just saying, it seems people always hanker for a bygone time, a simpler time, even a time withou as much gov't innvolvement. What would thiings look like?... Would you want your faith totally in the private sector? Do people even remember what it was like? Heck, do they have relatives who remember what it was like? Would we all be beating down the doors to our bank with pitch fork in hand?

 

^^

 

Pretty nice post for my comeback after over a week off... Don't you think?

 

 

You're a legend in your own mind...

[blzrul]

I've been buying physical silver. I purchase it in a variety of 100 oz. bars, 10 oz. bars and 1 oz. rounds. You can do a google search of coin shops or numismatic shops in your area that sell bullion. I prefer silver for a few reasons. First it is a low cost metal that is easy to liquidate and is untracable by the Federal Gov't. It is a cash and carry purchase with no records kept or taxes paid. The historic ratio of silver to gold is just above 10:1. Right now Silver is trading at about a 50:1 ratio, so there is serious potential for explosive growth. Metals are also a 'survival currency'. If the dollar were to collapse, which while a longshot is a distinct possibility, metals would become currency. That is why many doomsday scenario believers hold it. Also, with inflation expected to rise (rapidly and soon in my belief), precious metals are a great investment. I'm not sure if you are old enough to remember the late 70's while Jimmuh was Prez, but it looks like we're at least headed back to that kind of economic condition at least for the short term. That is when silver and gold set records for value.

 

Mind you I am not liquidating my stock investments, but taking the cash portion of my regular investments and diverting it to metals. It will only lose value if I put it in my regular savings account.

And do you bury it in the desert too?

[GG]

Find me ONE PLACE WHERE I TELL ANYONE TO DO ANYTHING! The only thing I am saying to do is to prepare for a possible collapse. I did say stock your freezer, but I will not tell anyone to invest in any stock. I say what I am doing, why I am doing it, so keep an eye on things if you want.

 

I've never touched those two myself. It's too tied in to the government to begin with.

 

We are on a PPP board. If someone is interested in a topic, they can view it. I'm not on the Bills board screaming "Jesus is coming you fools!" I do chime in with possible economic conditions affecting the Bills, but the main talk is here. There are plenty of posters who have good ideas and bring worthy news here. Considering that today was another HUGE day in economic wares, I felt more than usual would be tracking the Dow and the markets, and said what I figured would happen.

 

I don't care if you think I'm cocky or emotional....just don't try and discredit my warning as having an alterior motive. What the hell can I gain? Oooh...maybe Lanka will think I'm hot in a nerdy sort of way!

 

What's that line about yelling "fire" in a crowded theater?

 

Please don't hide behind the veil it's just my opinion and I'm just relaying what I'm hearing in the market. You are part of the chorus that's causing the continuing instability. You were right about Bear & Lehman in January? No, you weren't. You were just part of the negative feedback loop that feasts on rumors and succeeds in bringing a firm down.

 

Before you rant away that I present a rosy view, let me nip that in the bud. The financial condition of banks & brokerages isn't good at all. But it isn't as catastrophic as you make it out to be. I have no qualms about firms failing due to poor performance and bad management. I do have an issue of the self perpetuating rumor cycle that brings down a firm. Bear didn't collapse because it had a bad book. It collapsed because people panicked and ran. The same is happening to Lehman, even though there isn't a fundamentally sound reason to think that it will collapse, other than a crisis of confidence. And who feeds that negative perception? The market. And who is this market? It's likely people like you.

 

Tell me, if you're so confident about Lehman's troubles and Bear's issues in march, how much time did you spend analyzing each firm's statements and publicly available trading records and positions? Or did you just lap up a rumor that you overheard from a trading partner that the firms are on the verge of collapse? Even if you didn't have a position in either (wrong as you admitted being short in Lehman) how much fundamental research did you do to establish your position?

 

Financial firms are only as strong as their reputation. You can trash talk auto makers, airlines, etc and they will get by because business will go on as usual. But idle chatter is much more critical when it comes to financials, because of the extra sensitivity these firms have to rumor & innuendo. Chuck Schumer should be taken to the woodshed for his interventionist ploy - and plainly shows how lack of confidence cn quickly bring down a bank.

 

You guys don't see it, but when this is said & done, get ready for much more regulation. Don't think that SEC will be done just looking for rumor-spreading scapegoats in the Bear collapse. More registration will hit the hedge funds, along with leverage limits for everyone. At least that will separate the good managers from the wannabees who could only juice returns with free debt.

[Dwight Drane]

GG.....you have NO idea what I do.

 

 

I have an idea what you do even though you won't tell me.

 

 

Here's a rumor. I'd pick up a Bible and start reading before you go throwing around rumors of any posters here such as myself. Or, move to Phoenix for some prep work.

[Dwight Drane]

And do you bury it in the desert too?

 

Silver or Stocks?

[SD Jarhead]

And do you bury it in the desert too?

 

Yea, sure lady.

 

With every passing day we are digging ourselves a deeper hole when the first thing one should do when in such a situation is stop digging. The Gov't just intimated that there will be no more bailouts, now the 'fun' is about to begin. But move along...nothing to see here. Hey, isn't American Idol about to start?

 

Here's a questions for all you wiseazz 'smart' people (yea you Nozzlenut): What are you doing to prepare for the brewing storm? Pretending it isn't there and will just blow over? Think the Gov't is going to be your safety blanket? Not me, I have a family and I couldn't live with myself if I didn't take at least basic common sense steps to protect them. And I'm not just talking about buying silver.

 

As I've mentioned in other threads. I live in S. California where we have a vary high probability of earthquakes occurring. Call me crazy, but I made common sense preparations in case such an event occurs. I'd offer that 90%+ of the population have no plan of talk to their children about things to do during and after such an event occurs. What's the old saying about an ounce of prevention?

[erynthered]

What's that line about yelling "fire" in a crowded theater?

 

Please don't hide behind the veil it's just my opinion and I'm just relaying what I'm hearing in the market. You are part of the chorus that's causing the continuing instability. You were right about Bear & Lehman in January? No, you weren't. You were just part of the negative feedback loop that feasts on rumors and succeeds in bringing a firm down.

 

Before you rant away that I present a rosy view, let me nip that in the bud. The financial condition of banks & brokerages isn't good at all. But it isn't as catastrophic as you make it out to be. I have no qualms about firms failing due to poor performance and bad management. I do have an issue of the self perpetuating rumor cycle that brings down a firm. Bear didn't collapse because it had a bad book. It collapsed because people panicked and ran. The same is happening to Lehman, even though there isn't a fundamentally sound reason to think that it will collapse, other than a crisis of confidence. And who feeds that negative perception? The market. And who is this market? It's likely people like you.

 

Tell me, if you're so confident about Lehman's troubles and Bear's issues in march, how much time did you spend analyzing each firm's statements and publicly available trading records and positions? Or did you just lap up a rumor that you overheard from a trading partner that the firms are on the verge of collapse? Even if you didn't have a position in either (wrong as you admitted being short in Lehman) how much fundamental research did you do to establish your position?

 

Financial firms are only as strong as their reputation. You can trash talk auto makers, airlines, etc and they will get by because business will go on as usual. But idle chatter is much more critical when it comes to financials, because of the extra sensitivity these firms have to rumor & innuendo. Chuck Schumer should be taken to the woodshed for his interventionist ploy - and plainly shows how lack of confidence cn quickly bring down a bank.

 

You guys don't see it, but when this is said & done, get ready for much more regulation. Don't think that SEC will be done just looking for rumor-spreading scapegoats in the Bear collapse. More registration will hit the hedge funds, along with leverage limits for everyone. At least that will separate the good managers from the wannabees who could only juice returns with free debt.

 

http://www.bloomberg.com/apps/news?pid=206...refer=worldwide

 

 

http://latimesblogs.latimes.com/laland/200...cite-schum.html

 

D. Drane trying to cover his arse?

[Dwight Drane]

http://www.bloomberg.com/apps/news?pid=206...refer=worldwide

 

 

http://latimesblogs.latimes.com/laland/200...cite-schum.html

 

D. Drane trying to cover his arse?

 

You know what...........I think I have finally had it.

 

 

You think you try and help people, especially those that have a connection to Buffalo, and now you get people pulling this stuff.

 

To the good people of the world that are still out there, best wishes in whatever happens. I obviously can't keep talking on here, which is exactally what Government cacksuckers like GG want.

 

To the scumbags.....your time will come. It won't have anything to do with money, houses, or any other little thing. It will be much bigger than that. Thank you for justifying my opinion that human nature cannot be trusted to get us out of this mess. And to think.....the Buffalo Bills fans of the world are taking down the banking system because some kid from Buffalo started posting a heads up to people starting in January.

[GG]

Thank you for justifying my opinion that human nature cannot be trusted to get us out of this mess.

 

Ever stop to consider that human nature got us into this mess in the first place?

 

So which one is it, buying the Dow at 10,500 or stockpiling the freezer and ammo?

[Gavin in Va Beach]

What's that line about yelling "fire" in a crowded theater?

 

Please don't hide behind the veil it's just my opinion and I'm just relaying what I'm hearing in the market. You are part of the chorus that's causing the continuing instability. You were right about Bear & Lehman in January? No, you weren't. You were just part of the negative feedback loop that feasts on rumors and succeeds in bringing a firm down.

 

Before you rant away that I present a rosy view, let me nip that in the bud. The financial condition of banks & brokerages isn't good at all. But it isn't as catastrophic as you make it out to be. I have no qualms about firms failing due to poor performance and bad management. I do have an issue of the self perpetuating rumor cycle that brings down a firm. Bear didn't collapse because it had a bad book. It collapsed because people panicked and ran. The same is happening to Lehman, even though there isn't a fundamentally sound reason to think that it will collapse, other than a crisis of confidence. And who feeds that negative perception? The market. And who is this market? It's likely people like you.

 

Tell me, if you're so confident about Lehman's troubles and Bear's issues in march, how much time did you spend analyzing each firm's statements and publicly available trading records and positions? Or did you just lap up a rumor that you overheard from a trading partner that the firms are on the verge of collapse? Even if you didn't have a position in either (wrong as you admitted being short in Lehman) how much fundamental research did you do to establish your position?

 

Financial firms are only as strong as their reputation. You can trash talk auto makers, airlines, etc and they will get by because business will go on as usual. But idle chatter is much more critical when it comes to financials, because of the extra sensitivity these firms have to rumor & innuendo. Chuck Schumer should be taken to the woodshed for his interventionist ploy - and plainly shows how lack of confidence cn quickly bring down a bank.

 

You guys don't see it, but when this is said & done, get ready for much more regulation. Don't think that SEC will be done just looking for rumor-spreading scapegoats in the Bear collapse. More registration will hit the hedge funds, along with leverage limits for everyone. At least that will separate the good managers from the wannabees who could only juice returns with free debt.

 

If these big financial firm behemoths can be brought low because of "rumor", then maybe we should regulate the schit out of them. These firms are handling Mom and Dads retirement money and you say because Trader Bob gets spooked and says "Watch out" that Mom and Dads money goes 'poof'? Give me a break. These firms shouldn't be defended, they should be torn down and rebuilt into something more solid that isn't so easily upset by the winds of gossip or Congressman writing letters.

 

I'm just an average schmuck on the street who readily admits I don't have 1/10 of the high finance knowlege that you do, but I don't think years of analysis is needed for my nose to be able to smell the stink that has been rolling in off of Wall Street lately. Hell, my nose was starting to smell the stink years ago when high dollar mortgages were being given to any fool with a pulse even though Greenspan and Co were telling us that the smell was rose petals. Those brillaint money guys are running our financial system and they really thought housing prices would go up forever?

 

Madness. The whole system had descended into madness. I'm not saying you're wrong and Mr Drane is right, or vice versa, but the truth is most likely somewhere in the middle and instead of this pissing contest how's about some common sense analysis of "where do we go from here"?

[erynthered]

You know what...........I think I have finally had it.

 

 

You think you try and help people, especially those that have a connection to Buffalo, and now you get people pulling this stuff.

 

To the good people of the world that are still out there, best wishes in whatever happens. I obviously can't keep talking on here, which is exactally what Government cacksuckers like GG want.

 

To the scumbags.....your time will come. It won't have anything to do with money, houses, or any other little thing. It will be much bigger than that. Thank you for justifying my opinion that human nature cannot be trusted to get us out of this mess. And to think.....the Buffalo Bills fans of the world are taking down the banking system because some kid from Buffalo started posting a heads up to people starting in January.

 

Oh my. Just a wee bit melodramatic, aren't we?

[SD Jarhead]

If these big financial firm behemoths can be brought low because of "rumor", then maybe we should regulate the schit out of them. These firms are handling Mom and Dads retirement money and you say because Trader Bob gets spooked and says "Watch out" that Mom and Dads money goes 'poof'? Give me a break. These firms shouldn't be defended, they should be torn down and rebuilt into something more solid that isn't so easily upset by the winds of gossip or Congressman writing letters.

 

I'm just an average schmuck on the street who readily admits I don't have 1/10 of the high finance knowlege that you do, but I don't think years of analysis is needed for my nose to be able to smell the stink that has been rolling in off of Wall Street lately. Hell, my nose was starting to smell the stink years ago when high dollar mortgages were being given to any fool with a pulse even though Greenspan and Co were telling us that the smell was rose petals. Those brillaint money guys are running our financial system and they really thought housing prices would go up forever?

 

Madness. The whole system had descended into madness. I'm not saying you're wrong and Mr Drane is right, or vice versa, but the truth is most likely somewhere in the middle and instead of this pissing contest how's about some common sense analysis of "where do we go from here"?

 

Excellent post. Speaking for self, I value D.D.'s opinion on the mess we're facing and view his posts as informative and helpful. I think G.G. also has valuable knowledge on the subject but that he is in 'blame mode'. From my perspective D.D called his shots awhile back when he wrote that behind the scenes was a mess and the Federal Gov't was trying to keep a lid on things and present a sense of normalcy for as long as possible.

 

This makes perfect sense because once the market senses the Fed has used up all the tools in its tool box this thing COULD get out of hand. Panic is our enemy and I think that's where G.G. has issues with D.D. He feels that D.D. is inciting panic which will lead to a further worsening of our situation. I do not agree with this logic.

 

I am not in the industry or an expert trader as you might be able to tell from my postings. But it doesn't take a rocket scientist to figure out that this is one BIG mess, that one odd event in the world (an attack on Iran?) could send this off of the charts.

 

FWIW, D.D., I sincerely hope you keep posting on this subject. To keep things in perspective G.G.- Drane's not Chuck Schumer, he's just a dude posting on a message board. Why kill the messenger?

[GG]

If these big financial firm behemoths can be brought low because of "rumor", then maybe we should regulate the schit out of them. These firms are handling Mom and Dads retirement money and you say because Trader Bob gets spooked and says "Watch out" that Mom and Dads money goes 'poof'? Give me a break. These firms shouldn't be defended, they should be torn down and rebuilt into something more solid that isn't so easily upset by the winds of gossip or Congressman writing letters.

 

I'm just an average schmuck on the street who readily admits I don't have 1/10 of the high finance knowlege that you do, but I don't think years of analysis is needed for my nose to be able to smell the stink that has been rolling in off of Wall Street lately. Hell, my nose was starting to smell the stink years ago when high dollar mortgages were being given to any fool with a pulse even though Greenspan and Co were telling us that the smell was rose petals. Those brillaint money guys are running our financial system and they really thought housing prices would go up forever?

 

Madness. The whole system had descended into madness. I'm not saying you're wrong and Mr Drane is right, or vice versa, but the truth is most likely somewhere in the middle and instead of this pissing contest how's about some common sense analysis of "where do we go from here"?

 

You can't regulate them to death, because then you will turn the system into Soviet monoliths where no one is willing to take risk, and banks simply turn into a money exchange institutions. On the other hand, you also can't regulate a bubble mentality, and that comes part & parcel with open markets, as people get aneastasized to risks.

 

People thought that creating the Fed was the great event that built the bulletproof institution that would reign over a stable financial system. Then it was the myriad laws enacted after the Great Depression. They all helped, but only at the margin. You need financial engineering to foster growth, but with that come the added risk.

 

It's not that Greenspan & Co thought that the housing boom would go on forever. The prevailing thought was that the last time you had a massive nationwide real estate bust was the great Depression, and the economic conditions and the financial safeguards of today would prevent a repeat. What they missed is that the housing boom was fed by a host of different factors - speculators, builders, lenders, investors and while each had a different economic foundation, the collapse hit them all at the same time, because the funding was largely coming from a single source - securitizations. In effect the focus was on the demand risk, and most people ignored the supply risk under the mistaken belief that the securitizations had spread the risk so far and wide that you would not have a systemic collapse if one lender failed. In retrospect, the risk was not dispersed at all, given the interlocking funding flows of the major financial players. BTW, this is not only limited to the US, as the main structurers of securitizations are in the UK.

 

As for a solution, there's not much to do but hope and wait until housing prices bottom out and buyers return to the market. At least that will set a floor, and vultures who lost a bundle in October '07 will feel safe picking up some carcasses. The big problem is not that banks have been suffering real losses, but without any buyers for much of the stuff they hold, they need to continue writing things down and that creates huge paper losses. Bills_fan had a good summary of what would be a hopeful scenario to restore a semblance of order.

[SD Jarhead]

GG-If I read you correctly, you feel (along the lines of what Bills_fan posted) that what the Fed did yesterday is our last gasp at containing this?

 

Here's something to consider though- for every homeowner that goes into foreclosure, it removes one candidate to assist with the recovery. Granted, had the system not been so !@#$ up in granting burger flippers mortgages in the first place, they probably wouldn't have been in the market. But, with ARM resets coming soon it looks like many with very good credit are going to go into foreclosure also. That is unless congress passes a bill to assist. But certainly inflation, which everyone is acutely aware exists right now, is going to get much worse from the printing presses working overtime. How do you see the Fed controlling this? And what if oil prices stay as high as they are?

[GG]

GG-If I read you correctly, you feel (along the lines of what Bills_fan posted) that what the Fed did yesterday is our last gasp at containing this?

 

Here's something to consider though- for every homeowner that goes into foreclosure, it removes one candidate to assist with the recovery. Granted, had the system not been so !@#$ up in granting burger flippers mortgages in the first place, they probably wouldn't have been in the market. But, with ARM resets coming soon it looks like many with very good credit are going to go into foreclosure also. That is unless congress passes a bill to assist. But certainly inflation, which everyone is acutely aware exists right now, is going to get much worse from the printing presses working overtime. How do you see the Fed controlling this? And what if oil prices stay as high as they are?

 

I wouldn't call it a last gasp. That will come when they guarantee all the mortgages & house prices

 

But they are running out of reasonable non-inflationary measures to slow the slide down. There's only so much that the Fed can do, and people shouldn't be expecting the Fed to do much more, as doing more would be worse. Hopefully, people with good credit & ARMs are talking to their banks and trying to work out a deal before the rates step up. I'm hoping that banks with a boatload of ARMs and piss-poor borrowers have hired an army of negotiators to try to get the borrowers to agree to better terms. Unfortunately, there isn't a lot of data out there on the actual workouts yet. You get a lot of anecdotal evidence, but no one has come up with a plan as many people are still in denial and there's fear that many will try to game the system. How could you tell whether a borrower needs to get a new mortgage contract? If you give better terms to a guy with poor credit, why does the guy with spotless credit have to pay more? Until these thorny issues are solved, and people start buying homes again, the slide will continue.

 

One plan that I read which sounds draconian, but may go a long way is to take possession of the empty and partially built homes and demolish them. One year later, there's still too much supply.

[ExiledInIllinois]

You're a legend in your own mind...

 

 

Actually, you are pretty good yourself!