Seattle Bubble Forum Archive

by **rose-colored-coolaid** » Wed Jul 18, 2007 7:41 am

Aight, it sounds like everyone agrees that this will not really finish falling out today. So far, it looks like my prediction is spot on.

DOW down 80 points right now, and Bernanke spinning bad news into 'good' that the economy 'will' 'grow' this year.

Calls that this is contained will continue. After all, it's contained to just subprime borrowers, exotic loan users, subprime lenders, Bear Sterns, and those who invested in two Bear Sterns hedge funds.

Do you know what else was contained? The TITANIC! It had compartments which couldn't spill over in the case of a hull breach...

by **Matthew** » Wed Jul 18, 2007 7:52 am

DJO,

Just to see that we are on the same page here. The investors initial investment in ONE of the two funds was 600 million correct? They are going to lose all of this. Sounds like both funds are going to end up being worthless. I don't think that whatever the final numbers end up being, either 600-1,000 million is anything to sneeze at. I'm not sure what the total leverage was on either of the two funds, but the impact is going to be felt.

by **Matthew** » Wed Jul 18, 2007 8:06 am

Another thing to ponder. The FED is in serious danger of having its power to regulate the mortgage industry stripped by Congress. The only thing that the FED has passed so far in regards to regulating the lending industry are "guidelines". Guess what? Guidelines are not enforceable. The lenders are still looking to Wall St. for guidance and not the FED. Wall St. so far is totally oblivious to any sort of risk right now, and are giving lenders the green light. The FED is going to have to pass something more than just guidelines for fear of having Congress step in a bitch slap them across the room.

If you think we have seen tightening already, that is absolutely nothing compared to what we are going to be seeing at the end of the year. You are going to see states pass legislation similar to what has already been passed in Minnesota that prohibit almost all forms of kinky loans. States react once they believe that the federal government is totally blind as to what is going on. Watch for the FED to step in and establish some lending rules, not just guidelines, in the near future. That will REALLY put the clamps on the lending industry.

by **deejayoh** » Wed Jul 18, 2007 8:46 am

by **TJ_98370** » Wed Jul 18, 2007 8:48 am

by **deejayoh** » Wed Jul 18, 2007 8:59 am

by **TJ_98370** » Wed Jul 18, 2007 9:06 am

by **deejayoh** » Wed Jul 18, 2007 9:17 am

by **TJ_98370** » Wed Jul 18, 2007 9:35 am

by **Matthew** » Wed Jul 18, 2007 10:27 am

by **deejayoh** » Wed Jul 18, 2007 11:32 am

Seattle Bubble Forum Archive

Continued Fun at Bear Stearns & Related News / Opinions

Who is online