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Where's that Dj guy/girl?

JazenJazen
edited August 2007 in The Economy
Here's my facts, prickhole.
http://articles.moneycentral.msn.com/In ... sMess.aspx
Again, I love it when I'm right.
Also check out these guys.
http://www.tickerforum.org/cgi-ticker/akcs-www
They might clue you in to a thing or two.
But all is well, remain calm.

Comments

  • AlanAlan
    Why the hostility?
  • JazenJazen
    Sorry, it's a bit overdone, I agree, but I am just trying to feed the public to what is going on in the world. I don't wish to mislead with gloom and doom as this dude accused me of. I stated we are going to see the end of the subprime, now the CONTAGION has spread. I don't like some dude saying I am too negative because it makes others reading the post think that maybe it will be all right, maybe there isn't a housing bubble. But there is.
  • Ouch!Ouch!
    The way I see it, only a few posters like Baby Blue question the housing bubble. The disagreement is about the extent of the damage. Inquiring minds will disagree - but don't take it personally.

    Sit back, relax, watch the show and chat. No need for name calling or claiming to be 100% right. The next few years will determine whose analysis is correct and whose isn't. If you can't support your evidence without name calling I have some advice for you - PROZAC.
  • JazenJazen
    Yeah, yeah.
    Watch tomorrow and learn boy.
    Also, I am totally relaxed, albeit a bit overjoyed, but totally relaxed. I rent, I have nothing to loose, I'm 87.3% cash and can't wait for it all to go into the toilet. So really, whatever.
  • JazenJazen
    It's nothing to sneeze at, and if I'm one of those investors, I'm pretty pissed - no doubt. But the exposure to loss was far, far, far greater. They were levered up 20x according to the bloomberg article. So the first fund could have lost up to ~$11B if the assets (e.g. the underlying CDOs) were worthless. The $600mm they lost was the principal. They lost none of the debt.

    Those investors could have had a margin call for 20x their initial investment if the bonds were "worthless". The fact is they recovered 95 cents on the dollar of the value of the assets in which they were invested. This is not a story about the cataclysmic downfall of MBS and CDOs. It's just an ordinary, every day example of the pitfalls of leverage. The more extreme the leverage, the more extreme the exposure.

    Look at the MarkIt charts. The worst tranches of bonds (BBB) are down from 99 to 88 - about 12%. And the fund was undoubtedly designed so that when these fell, some other asset was supposed to be going up (ergo, the reason it is called a "Hedge Fund") so they seem to have recovered some of that. Clearly it didn't work as intended, but they only lost their principal - which to me is surprising given all the doom and gloom predictions.
    As you can see, this boner had a vested interest in trying to throw water on the fire. So, go ahead listen to him, get yourself well leveraged in a good hedge fund and don't expect any KY.
    Fool.
  • The_TimThe_Tim
    I'm locking this thread.

    You can make your points without throwing around gratuitous insults at other forum members.

    Thanks.
This discussion has been closed.