Archive - Story

Moody's just piledrived Gannett and cut its bond rating to junk. The company which was downgraded to the lowest IG rating Baa3 on February 2, just got the last kiss as Moody's cut its unsecured debt rating to Ba2. Not as much harsh language as S&P has been dispensing lately, just the sad reality of the situation as Gannett enters Junkville.

But, but...this was all contained the last time the company lied about its current state... Looks like US Taxpayer Capital LLC will need some CDS salespeople/traders as it is the unwitting recipient of a $300 billion CDS book.

Feb. 26 (Bloomberg) -- American International Group Inc. may get a backstop from the U.S. to protect against further losses on credit-default swaps, according to a person familiar with the matter.

The surprisingly resilient HY and IG market over the last two months (and the reason why so many hedge funds outperformed benchmarks) is starting to crack. We have discussed how purely fundamental assumptions about recoveries in the upcoming wave of defaults will likely reprice risk substantially lower, however a mere glance at existing technicals imply the HY market, especially the single B rated tranche and single names, will soon experience a drubbing.

The house of Dubin and Swieca doubles as one of cards as well. Great investment by JPM also.

From Bloomberg:

Feb. 26 (Bloomberg) -- JPMorgan Chase & Co., the second-biggest U.S. bank, said its Highbridge multi-strategy hedge fund’s assets declined 32 percent in 2008.

The fund lost 27 percent last year, James Staley, head of JPMorgan’s investment unit, said at an investor day conference today in New York.

The surprisingly resilient HY and IG market over the last two months (and the reason why so many hedge funds outperformed benchmarks) is starting to crack. We have discussed how purely fundamental assumptions about recoveries in the upcoming wave of defaults will likely reprice risk substantially lower, however a mere glance at existing technicals imply the HY market, especially the single B rated tranche and single names, will soon experience a drubbing.

McKinsey must have been paid $1 million to come up with that title...

I dare anyone making over $250,000/year to read the whole thing. After all you will have to fill the $1 Trillion hole...

US Budget - Free Legal Forms

Obama's (first) budget calls for no more student loan subsidies, which has caused SLM stock to plunge 40%. As Obama has no problem with spending a few hundred billion to address any and every shareholder's cry for stock price appreciation, we are confident the final budget will likely include subsidies as this was merely a minor fiscal prudence and rationality-driven oversight.

Karl Otto Poehl is pouring some major cold water on all the optimistic talking heads saying eurozone defaults can be avoided. According to the former Bundesbank president, a default of smaller member of the euro region is only a matter of time.

What was that president Obama, you will cut the budget deficit to $500 billion by 2012?

2009 deficit to be $1.75 trillion, 12.5% of GDP. It will be "eliminated" as the rich are taxed right into lower middle class.

Explains why the market performs like a schizophrenic day trader, as investors try to game the greater fool in unison, running the market up and down especially in market leading sectors such as financials. As long as a fund is not the last man in, the first 50% in any wave are set to make profits.

Explains why the market performs like a schizophrenic day trader, as investors try to game the greater fool in unison, running the market up and down especially in market leading sectors such as financials. As long as a fund is not the last man in, the first 50% in any wave are set to make profits.

Developing story, but with such blockbusters as Lyondell and Continental AG one had to expect they would pull the plug sooner or later.

New home sales tumble over -10% month over month to 309,000, on an expectation of a -2% drop. Market rips. Logical? Who cares. When horrendous news is fantastic news we advise everyone to pull their money out of the market for one reason - it is terminally broken.

In the meantime, a brief look at the real housing picture, and why anyone may soon be able to afford a Palm Beach waterfront house.

New home sales tumble over -10% month over month to 309,000, on an expectation of a -2% drop. Market rips. Logical? Who cares. When horrendous news is fantastic news we advise everyone to pull their money out of the market for one reason - it is terminally broken.

In the meantime, a brief look at the real housing picture, and why anyone may soon be able to afford a Palm Beach waterfront house.

After the prompt futures' rebound following the earlier horrific durables and initial jobless claims, we are 99% convinced the market is set on ignoring any pig that isn't smothered in lipstick (the technical argument goes pigs with lipstick are priced in), so the following piece of news will definitely not have any impact on the whole bunch of "leap of faith" focused investors cum Indiana Jones and The Last Crusade fans (best of the four by far).