Archive - Apr 2009

compliments of Creditresearch

compliments of Creditresearch

compliments of Creditresearch

hat tip Verne

Equity Private (here and here) has put together some interesting points of when/why/how/under what conditions the banks may cross the TARP repayment finish line first, and as a result doom the stragglers to another price pop of at least 50% (shh, the market works in mysterious ways these days).

CDS market snapshot implies equities should be about 1% lower at this moment.

GS +12,
MS +5,
AXP +30,
GECC +45,
COF +25

Insurers, newspapers and builders all wider.

Yet the equity market is higher on its merry illiquid way to 30,000. (That guy will turn out smartest of all.)

Someone get the market some Geodon please.

Some useful legal background from Sidley Austin to prepare readers for the key issues once the insurance dominoes start falling.

After a long and painful fight with assorted tomato mosaic viruses, lack of cash flow and illiquidity, Arizona greenhouse tomato grower Eurofresh finally succumbed to a long overdue bankruptcy. Immediate causes for death were not given. Major creditors which include Apollo Management Inc (AINV) and Barclays will hold a wake and huddle up to discuss how to mark their worthless bonds at 40-50 cents on the dollar ahead of their next earnings call.

All you ever wanted to know about leveraged ETFs from the people who know everything about them: Barclays Global Investors.

Some take aways:

"For example, a broad 1% move in the US equity market would result in additional Market On Close demand of about 17%, while a 5% move is associated with demands equal to 50% of the
close." - can someone spell massive convexity?

Zero Hedge is well aware that our regulatory friends at the SEC and FINRA enjoy going through our articles in search of the "next big scam." We are always happy to make their lives a little easier and not only connect the dots but give them everything they need on a silver platter so that even a green securities lawyer, 4 hours fresh out of law school, would be able to comprehend and litigate.

Zero Hedge is well aware that our regulatory friends at the SEC and FINRA enjoy going through our articles in search of the "next big scam." We are always happy to make their lives a little easier and not only connect the dots but give them everything they need on a silver platter so that even a green securities lawyer, 4 hours fresh out of law school, would be able to comprehend and litigate.

• Must Read: Jack Bauer can't stop the Goldman Conspiracy (Market Watch)
• This is what happens when you don't have access to the AIG funnel: BNY Mellon falls 51% as fees fall with markets (Bloomberg)
• Michael Milken: Why capital structure matters (

• Cash-strapped cities move to private guards (WSJ)
• Questions on Pandit's future at Citi (FT)
• Loan quality to be closely scrutinized by stress-test regulators (Bloomberg)
• CCU tries to restructure debt load out of court (NYT)

The attached graphs demonstrate the massive rally in Sovereign CDS over the past few weeks, as well the collapse in the divergence in the VIX - Sovereign CDS pair.

The attached graphs demonstrate the massive rally in Sovereign CDS over the past few weeks, as well the collapse in the divergence in the VIX - Sovereign CDS pair.