The (Monthly) Cost Of Bankruptcy
Submitted by Tyler Durden on 08/11/2009 - 20:43Readers have been recently inquiring why it is that so many financial advisors have sprouted all over the place and are scrambling to represent bankrupt companies: after all the company is, well, "bankrupt" - how much money can financial advisors really make on these kinds of deals? The answer may be surprising, especially in light of the proliferation of various splinter financial advisors who had previously been part of larger firms.
Latest DTCC CDS Update (Week Of August 7)
Submitted by Tyler Durden on 08/11/2009 - 19:31Continued substantial rerisking continued in financial last week, however at a slightly moderated rate. From the $96.2 billion net notional decline in the week ended July 31, the last week saw a $54.4 billion decline. Total net notional change was one tenth that of the previous week at -$14.5 billion, with a marked derisking in consumer services at $25.1 billion. Other notable derisking spaces were Industrials and State Bodies.
Merrill's RateLab On GSE's: The Denouement
Submitted by Tyler Durden on 08/11/2009 - 16:29"After all the finger pointing at greedy Wall Street big-wigs, a somnambulant FED, and “tulip-crazed” homeowners is over, the fact remains that the nexus of the housing market is Fannie Mae and Freddie Mac, aka, the GSE’s (Government Sponsored Enterprises). And just as the beginning of this crisis can clearly be marked to the date that their financial situation tipped south, so can we be sure that our problems will not be truly over until they have been stabilized." - Harley Bassman, ML
Daily Credit Summary: August 10 - MOMO NO MO
Submitted by Tyler Durden on 08/11/2009 - 15:56Spreads were broadly wider in the US as all the indices deteriorated (as HY underperformed IG and both closed at one-week wides). Indices typically underperformed single-names with skews widening in general (extending the trend of single-name weakness from the middle of last Friday) as IG underperformed but narrowed the skew, HVOL outperformed but widened the skew, ExHVOL's skew widened as it underperformed, XO's skew increased as the index outperformed, and HY's skew widened as it underperformed.
Stocks Flushed As Bonds Up, IG12 At Week Wides
Submitted by Tyler Durden on 08/11/2009 - 15:06
Late day sell off in stock translated into buying in treasuries - no surprise there. The AUD is doing whatever carry trade it does. VIX at the days lows. And the IG12 CDS index closes at 113 bps, 6.5 bps wider in a rush.
Multivariate Fibonacci Retracements
Submitted by Tyler Durden on 08/11/2009 - 13:24
The current Fibonacci retracement visualized in both price change and time.
Moody's Nukes 163 CMBS Classes Due To Maguire Toxic Exposure
Submitted by Tyler Durden on 08/11/2009 - 13:03Classes affected: * 15 CMBS Classes of WBCMT 2006-C28;
* 10 CMBS Classes of MSC 2004-TOP13;
* 14 CMBS Classes of WBCMT 2005-C18;
* 14 CMBS Classes of JPMCC 2006-LDP8;
* 14 CMBS Classes of GSMS 2005-GG4;
* 17 CMBS Classes of GSMSC II 2007-GG10;
* 19 CMBS Classes of CSMC 2007-C4;
* 7 CMBS Classes of GCCFC 2003-C2;
* 18 CMBS Classes of CSMC 2007-C3;
* 12 CMBS Classes of BACM 2005-3;
* 11 CMBS Classes of BSCMS 2004-TOP14;
* 12 CMBS Classes of BACM 2006-6;
Wachtell, Lipton On The Second Circuit's Attempt To Cover Up Its Chrysler Tracks
Submitted by Tyler Durden on 08/11/2009 - 12:45"The Second Circuit explained that the size of the transaction and the residuum of corporate assets are factors that a bankruptcy court must consider, but are “just one consideration . . . along with an open-ended list” of other issues, such as whether the sale was on terms advantageous to the estate and whether a plan of reorganization might be proposed and confirmed in the near future. Moreover, the Chrysler court specifically held that section 363(f) of the Bankruptcy Code allows a debtor to sell assets free and clear of “successor liability” for pre-petition tort claims."
$37 Billion 3 Year Auction Results
Submitted by Tyler Durden on 08/11/2009 - 12:24
- Yield 1.780% vs. Exp. 1.791%
- SOMA $5.7 billion
- Bid/Cover 2.89 vs. Avg. 2.7 (Prev. 2.62)
- Indirect bids 62.5% vs. Avg. 45.11% (Prev. 54.15%)
- Alloted at high 13.08% (BBG)
Average TICK Dropping
Submitted by Tyler Durden on 08/11/2009 - 11:32
One dollar for whoever has access to the morning memos distributed today at Federal Reserve Capital LLC.
Update On NYSE Order Cancellation
Submitted by Tyler Durden on 08/11/2009 - 10:58
The NYSE has issued an updated System Status and notified traders that all orders in over 40 stocks, among them BRK, entered before 11:45 am have been canceled. Trading in these securities is expected to resume at noon. Even robots need a vacation.
Today's OMO Update
Submitted by Tyler Durden on 08/11/2009 - 10:37Today, at 11:00am, the Fed was supposed to close an OMO Purchase of 17 Cusips, with maturities ranging from 2026 to 2039. The original auction was Cancelled according to the NY Fed website. The auction was subsequently completed with a 20 minute closing time delay.
Federal Reserve Capital LLC; Ben Bernanke Earning Your 2 and 20 With Daily Short Covering Diligence
Submitted by Tyler Durden on 08/11/2009 - 09:42"When people kid around that the Fed has become another hedge fund now that it is the lender of first, second and last resort — to mention the market-maker for everyone including RVs and mobile homes — it really is no joke at all. See NY Fed in Hiring Spree as Assets Soar. The New York Fed is seeking to bolster its staffing of traders — not research staff, but traders — by nearly 70%!! When will the Fed start hiring investment bankers? That is what we would like to know."
The Paulson Ethics Waiver
Submitted by Tyler Durden on 08/11/2009 - 09:11Presented is the recusing ethics waiver that allowed Hank Paulson free reign to do as he saw fit when bailing out Goldman Sachs. The next question is whether Mr. Fred Fielding recused himself of recusing Hank, and just what authority he was granted by the president to allow such unprecedentedly conflicted individuals as the former CEO of Goldman Sachs to do everything in his power to not only place unlimited collect calls into Lloyd Blankfein's office but to make sure that Goldman was the primary beneficiary of all the banking cataclysms of 2008.
