Goldman Keeps On Cheering CBL... For Now
Submitted by Tyler Durden on 06/27/2009 - 16:03Everyone's favorite Goldman REIT analyst is still not downgrading CBL to a Conviction List Sell. In fact, Habermann is doing all he can to salvage whatever he can. That being said, we give this stock at most 3-4 weeks before it gets whacked if not to a Sell to at least a "Conviction List" Hold.
FDIC Starts Extending The Maturities Of Various Alphabet Soup Crutches
Submitted by Tyler Durden on 06/27/2009 - 16:01The FDIC announced a proposed extension of the first of many alphabet soups currently propping up the banking system. In this case, it is the Transaction Account Guarantee (TAG) component of the TLGP program. The proposed extension (the first of maaaaany) will push the maturity from December 31, 2009 to June 30, 2010.
Some Quotes From Bank Of England's Mervyn King And Paul Fisher
Submitted by Tyler Durden on 06/27/2009 - 16:00UK faces quite considerable headwinds
UK banking system not in strong position to lend
UK recession put downward pressure on inflation
BOE has bought GBP 96 billion of assets in APF
"If you withdraw stimulus too quickly face risk of renewed downturn"
Quants Hoping For Resistance Break Out On No Volume
Submitted by Tyler Durden on 06/27/2009 - 15:59
Deja vu all over again: failed green shoot, no volume, high beta break out, one or two brokers gunning the SPY (here's looking at you 85 Broad): the tried and true script over the past 3 months seems to have a little life left in it still, with all rational cash players sitting on the sidelines as always, doing Starbucks breaks every hour and waiting for the release of RenTec's results indicating Medallion made double the combined negative "return" of REIF and RIFF (and JPM torn between trading for the latter and its own Highbridge).
Lenders Set To Scuttle Continental - Shaeffler Merger; Lawsuits Will Follow
Submitted by Tyler Durden on 06/27/2009 - 15:56The second most favorite German soap opera on Zero Hedge (just after the Volkswagen - Porsche melodrama) looks set for a second season. Bloomberg reporting that lenders who hold half of Conti's humongous €11 billion debt load will do all they can to prevent the merger. It's funny it took lenders only about a year to get their case of buyer's remorse sufficiently well crystallized.
Moody's: Credit Card Charge Off Rate Highest In 20 Years
Submitted by Tyler Durden on 06/27/2009 - 15:54Hi-fi quants are like pigs in a trough today, driving the market on horrible new home sales numbers just as State Street is back to its usual antics and (or as a result of which) Fidelity disclosing no IWM borrow available. In the meantime, Moody's has released its Credit Card Index update: charge off rates for May have now surpassed 10%.
Mortgage Rate And Home Sales Weakness Accelerates
Submitted by Tyler Durden on 06/27/2009 - 15:52
Jim Cramer was spot on with calling the housing bottom. Oh wait - he was dead wrong again about this as he is about everything else: downward prior revision and lower than expectations. At least he is consistent at batting 0: almost as good as someone batting 1000.
Latest DTCC CDS Update (Week Of June 19)
Submitted by Tyler Durden on 06/27/2009 - 15:49
The name of the game last week was the roll, with the expiration of the June contract leading to over $300 billion in Matured Transactions. New protection creation was delayed into the roll and this week will likely see a comparable pick up in new protection purchasing.
Is Raiffeisen Bank Bankrupt?
Submitted by Tyler Durden on 06/27/2009 - 15:45Zero Hedge discussed a few months ago the fact that the ratings agencies consider distressed exchange offers essentially equivalent to an event of default. If that is the case, then Raiffeisen Bank is basically bankrupt: one of Austria's biggest banks with massive Eastern European exposure has recently launched an exchange offer for €500 million of notes (ISIN: XS0253262025) at 55 cents on a dollar, to be exchanged into new notes yielding 15%!
Daily Highlights: 6.24.09
Submitted by Tyler Durden on 06/27/2009 - 15:44Frontrunning: June 24
Submitted by Tyler Durden on 06/27/2009 - 15:43The Relationship Between Bonds And CDS Spreads
Submitted by Tyler Durden on 06/27/2009 - 15:33As many readers have been requesting data on both intro and intermediate CDS topics, I am posting a paper on one of the most fundamental credit derivative concepts: how to equate CDS pricing levels with those of cash bonds. As new concepts emerge, more explanatory information will be provided. Enjoy the paper - compliments of Maiden Lane I.
Overalottment: June 23
Submitted by Tyler Durden on 06/27/2009 - 15:32Second Budget Hotel Bankruptcy In One Week, CRE Getting Monkeyhammered
Submitted by Tyler Durden on 06/27/2009 - 15:30First it was Extended Stay, which filed for bankruptcy last week (and whose unexpected filing may make life for CMBS participants very complicated as the law of unintended consequences strikes again). Today, it is budget hotel chain Red Roof Inn. The company, which owns 210 hotels, defaulted on $367 million of mortgage debt, has a total of $1.2 billion in total debt, including mezz loans and other notes. The company was purchased a mere 2 years ago by Citigroup (yep, the same phenomenal deal makers who wouldn't know how to find their gluteus maximum with a magnifying glass, bought a 79% stake in yet another toxic piece of garbage) from Accor SA for $1.3 billion.
What Is Spooking Auto Supplier CDS?
Submitted by Tyler Durden on 06/27/2009 - 15:27Or maybe the correct question is "what wasn't" especially for the past 3 months... I touched earlier upon the pain that is still to be unleashed upon the autosuppliers when I discussed the Visteon CDS auction. However, it seems the credit market is already on top of this. A brief observation of the CDS (and to an extent the equity) levels of TRW and American Axle indicates that over the past week something has really spooked longs in the names.
