Archive - Apr 9, 2009 - Story

Trim Tabs has released its weekly mutual fund flow data: the company estimates that all equity mutual funds posted an inflow of $11.9 billion in the week ended Wednesday, April 8, versus a revised inflow of $3.0 billion in the previous week.

Life insurer Genworth Financial dropped 22% after the Office of Thrift and Supervision said it had declined the company's application to become a savings and loan holding company.

One of the more pervasive pieces of conventional wisdom is that senior classes in non-agency RMBS (read AAA) are safe and sound even in a defaults due to their first money nature that isolates them from the potential loss problems of the lower tranched classes. An interesting tidbit that has arisen as a result of a close read into the HR 1106 Bill "Helping families save their homes act" indicates that many deals' legal documents have a "bankruptcy carve-out".

come to think of it, they do bring up some valid points.

[youtube=http://www.youtube.com/watch?v=pzTrPVSni14&hl=en&fs=1]

hat tip Ian

According to MC Cabrera, GM's bondholders are about to get a substantial shaft: a new proposed offer to them would include:

- $0 new cash
- $0 new debt
- 10-20% of the company stock.

This is a dramatic deterioration from the old proposed offer (which bondholders were not happy with in the first place):

- 8 cents cash
- 16.5 cents new debt
- 90% of GM stock

Zero Hedge has previously discussed the aberration effects of daily gaps (up and down) as well as trading volume on the true state of market fair value indications. We present some VWAP (Volume-Weighted Average Price) data for our readers based on SPY index price and volume levels. We end up with some interesting conclusions.

In light of the market moving preannouncement by WFC, which as David Faber points out may have used some "leeway" with the marks on the company's mortgage related assets, it makes sense to present some California foreclosure data to show just how hot the refi market really is. We grab the following data and charts from the excellent Field Check Group blog.

Providing the ugly fundamental truth in the good ole days used serve as cold water for a rally... now - not so much: after all who cares for logic? Dave chimes in.

The market has still not reflected reality

After a 25% rally in the past 40 days, is the market set to undo its 45% loss from the S&P500 all time highs? Many bulls are now claiming that now all is back to normal, and that despite the loss of the securitization product, the government will be happy to releverage consumers and companies to historic credit levels following the bail out mantra "take out debt now, spend tomorrow, save...

• Jonathan Weil: Obama stakes his fortunes on failed banksters (Bloomberg)
• Wells Fargo profit jumps on 4% mortgage refis (Bloomberg)
• All banks expected to pass "stress" tests (NYT)
• Trade deficit falls to lowest since 1999 on plunge in imports, initial jobless claims at 654
  

Or so the government says... even with minimal background knowledge, it's not too much of a reach to call BS.

• U.S.