Market crash: are we there yet ?

[PBzeer]

Ya know Rick, you're becoming tedious in the extreme. Mind pointing out the post where I said the economy is wonderful? I've known 2 year olds that don't whine as much as you do. And seen people with one foot in the grave with more optimism than you seem to be able to find. It easy to imagine you gleefully smirking as you wrote the last post.

And by the way, which of your hero's is right? Dodd saying Bush didn't enforce the sufficient regulation that was in place. Or Frank saying the GOP gutted all the regulation. 'Cause quite frankly, I don't know which one of 'em right. And we'll ignore Clinton this morning saying the Dems wouldn't go along with him and the GOP on reining in Fanny and Freddy, since that doesn't fit the scenerio you've dreamed up.

Like it or not, this problem wouldn't exist without the subprime market which was put in place by the Democrats. I freely admit that the GOP didn't do enough to rein it in, but at least they tried. Dodd and Frank as recently as 2 months ago were saying there wasn't a problem with Fanny and Freddy.
You're just going to have to learn to live with the fact that there is no one convenient scapegoat with an R after their name to pin this on. It was a systemic failure.

[PBzeer]

Ooops, J P Morgan took over WaMu. Guess maybe a few of them folks will still have a job in the morning.

Isn't that the way the market works?

[Rickm505]

Originally Posted by PBzeer

Ooops, J P Morgan took over WaMu. Guess maybe a few of them folks will still have a job in the morning.

Isn't that the way the market works?

The largest number of bank failure since the 1930's and you say "oops"?

The market worked just great in the Great Depression too.....

The bailout plan has been stopped dead by Senator Shelby and friends. Dems refuse to vote on this without Republican support. Foreign Banks bailouts is the deal breaker.

Good for him

[PBzeer]

So, JP Morgan taking them over .... at no cost to the taxpayer .... is a bad thing? It would appear, that rather than WaMu failing, it's management failed, as it's still in business under new owners.

[sailaway21]

Originally Posted by Rickm505

The largest number of bank failure since the 1930's and you say "oops"?

The market worked just great in the Great Depression too.....

The bailout plan has been stopped dead by Senator Shelby and friends. Dems refuse to vote on this without Republican support. Foreign Banks bailouts is the deal breaker.

Good for him

As usual, wrong again.
The 10 Biggest U.S. Bank Failures - US News and World Report

[sailaway21]

A Republican mess? Ouch! To paraphrase Reagan, it's not that Rick knows so much, it's that so much Rick knows is wrong. From the NYT in 1999:

Fannie Mae Eases Credit To Aid Mortgage Lending - New York Times

Read that one, Sport!

[Rickm505]

Originally Posted by sailaway21

As usual, wrong again.
The 10 Biggest U.S. Bank Failures - US News and World Report

Are you smoking dope? Sailaway21-itis strikes again

WaMu is largest U.S. bank failure
By Elinor Comlay and Jonathan Stempel 43 minutes ago




"Washington Mutual has about $307 billion of assets and $188 billion of deposits, regulators said. The largest previous U.S. banking failure was Continental Illinois National Bank & Trust, which had $40 billion of assets when it collapsed in 1984."

It' only 7 times larger than the previous 'largest bank" failure which is number 1 on your list.

Sheesh... lately your posts just aren't up to snuff...

[Rickm505]

Originally Posted by sailaway21

A Republican mess? Ouch! To paraphrase Reagan, it's not that Rick knows so much, it's that so much Rick knows is wrong. From the NYT in 1999:

Fannie Mae Eases Credit To Aid Mortgage Lending - New York Times

Read that one, Sport!

It's a waste of time to respond to such poorly thought out posts. I'm tired of correctly them.

Yer on your own....Sport..

[sailaway21]

"The largest number of bank failures since the 1930's..." Those are your words, Sport and they're demonstrably wrong as shown by the chart in the US News & World Report article. And my last "poorly thought out post" was merely a reference to a 1999 NYT article that has a little problem with your contention that the mess is Republican in origin. As usual, when confronted with any facts, you're running like a deer. I'll have to agree with Pbzeer, you show an unhealthy glee over bad news, your apparent stock in trade. Facts and the truth you are only tangentially familiar with and certainly not on a first name basis.

And your heroes Bernanke and Paulson have been wrong at every turn. I doubt they'll get the Congress to trust them with 700 billion, at least I hope so.

See you at the next downturn, Sport. If anything, you're predictable.

[chris_gee]

Now we are getting a wee bit heated aren't we. At this point in the discussion it is disconcerting that some don't understand the basics. Too often they appear to substitute their own opinion or some hack propaganda for readily available expert analysis.
"If there's illiteracy it's on your part, Sport! If an MB consists of 3% bad paper it must then have 97% good paper within it as well or something is fishy. And you do seem to be changing tunes yet again, the banks have money-they're just not lending it. Likewise, you'd be the last person to learn from that AIG's core business of insurance is doing quite well as it were. So we can hardly expect a trenchant analysis of corporations not letting lust for quick profits get in the way of core business expertise from you now can we?"
The previous post by Sailaway said if the foreclosures are 3% 97% are paying. Nonsense of course because a proportion are in arrears, foreclosure takes time, as the market falls more home owners are underwater, ARMS will reset to higher rates and unemployment likely rise making more fall into arrears and eventually foreclosure.
Further the mortgages were arranged in tranches with the lower grades now revealed to have falsely been given AAA ratings allowing them to be bought and held by institutions only able to buy investment grade securities. They have now been downgraded.
Some of these lower tranches are now worthless. The sale referred to at 25% if you looked actually was 6% cash if all the details of the deal are included.
One of the difficulties is that a lot of the investment banks were leveraged 40x on these things. So even a small loss would wipe out their capital.
The problem with AIG was their involvement in the CDO CDS stuff effectively insuring against losses on this paper. Moreover they were involved as guarantors for others. It really is irrelevant that they had other core profitable business. You lose your capital you lose the business.
As for PBZeer citing salary figures over 1980 -2005 to show the proportion earning over 50,000 increased "so something worked" words fail me. Could someone tell the man what inflation is?
In an earlier post I referred to an analysis of the causes of this mess. There are others. How futile to regress into party political wrangling over causation.
If anyone is actually interested in being independently informed from a range of independent experts rather than just building their posts or relying on Rick as informant/target I recommend nakedcapitalist.com for really up-to-date news and commentary.