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Guest Post: It’s 2010: What Should Investors, Traders and More Importantly What Should We as Americans Do Now?
It’s 2010: What Should Investors, Traders and More Importantly What Should We as Americans Do Now? Submitted by John Bougearel of The Commodity Trading Advisor
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Me, I'm crying for my mommy.
Make the insanity stop!
What should Americans do?
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NATIONAL STRIKE
April 15 to April 18TH
Tell Everyone You Know
POST THIS ON EVERY DISCUSSION BOARD
www.taxfree15.com
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Join The Civil Revolution
Watch and FWD THIS LINK
www.REVOLTstartsNOW.com
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We should see reality for what it is..........
Can you trust ANYTHING???
Full screen mode...
There is no reality....
We are living in a prison house of the mind..CRE Slow fall...or?
http://www.youtube.com/watch?v=clnozSXyF4k&feature=player_embedded
As for the CRE loans, it appears that the banks, allowed to by the gubmint, will just keep collecting interest and principal payments on properties that are underwater and kick the refi down the road. Hoping of course that the values will rise and the refi can occur and not cause any writedowns. At this point the fix is in by the banks and I would be cautious betting against them because of CRE loans.
Geopol, I agree but in face of it seems we must adopt the reality of the capitalist regime with the most power,for it it is they that control the capital and write the rules of whatever reality they choose!
Something about the French revolution and Bourgeoisie is ringing in my ears.
Hi Anon,
Capitalist / Free markets in Amerika have diminished as the time-line has progressed..We have a federalist system that will not co-exist with a liquid system...
Marie Antoinette?? I'm not sure the American People can mobilize....
Open your breast, sire, to liberal and expanded thought. Let not the name of George the third be a blot in the page of history. You are surrounded by British counsellors, but remember that they are parties. You have no ministers for American affairs, because you have none taken from among us, nor amenable to the laws on which they are to give you advice. It behoves you, therefore, to think and to act for yourself and your people. The great principles of right and wrong are legible to every reader, to pursue them requires not the aid of many counsellors. The whole art of government consists in the art of being honest... -Thomas Jefferson. God, the man could write.
I don't disagree with Mr. Bougearel's conclusions, but some of his facts are just flat wrong. It makes one suspicious of someone who not only mistates facts, but shows skewed pieces of the whole picture to paint a story that fits their goals.
CRE maturity terms are heavily weighted in two camps, short-term loans for transitional properties mostly on banks' balance sheets, and long-term loans for stabilized properties in CMBS deals and insurance company portfolios. Obviously there were some poorly underwritten loans in CMBS, and elsewhere, but I'm still going to use the word "stabilized" here. 5-7 Year Maturities? Not really a majority of the market - more like 16.9% of the CMBS market!
http://thecrereview.blogspot.com/2009/05/loan-term-lengths.html
Further, the CMBS maturities he shows in the chart are a problem. There is like $60bln in CMBS debt maturing that year. BUT there is over $200bln in Bank/Thrift-originated CRE loans maturing that year. Watch out for that the thug across the street who looks shady, but don't worry about the 18-wheeler with no brakes and dynamite as cargo going 80mph 5-feet behind you.
"banks already suffering from bad residential loans..."? The resi loans were virtually all securitized, CRE loans were only 25% securitized.
thank you for the feedback. You bring up a good point about the CRE loans only being 25% securitized. Banks are going into this debt restructuring cycle already constrained, hoarding, and unable to extend credit because loan loss provisions are still inadequate. They will need to rely on the shadow banking system and the broken securitization market to refi these loans. Without fixing the broken securitization mkt first, there will be no investors around to extend the necessary credit to the CRE mkt.
Great insight. My questions:
1. who are the main commercial real estate holders that will need to refinance and take this hit - will it be commercial property holders (REITs i guess) or the banks who currently hold the loans and wont be paid back? which ones (tickers?)??
2. who are the main LBO organizations that will need to refunance and take this hit? (or their financiers??)
3. who are the main state government bond insurers that will need to take this hit?
thanks for any tips!!
Japan bought the IMF gold today.
very, very interesting..
Its that no counter party risk thingy again
Got gold?
Gonna have to call bullshit on this since I can't find the news story to back it up.
Accidents happen when the yield curve goes flat. That is when you not only reballance but change the portfolio weights toward lower beta stocks and more bonds. Works all time! When to go the other way, when the Coppock Indicator reverses.
In my humble, but most accurate opinion, traditional investors are getting killed, and will continue to get killed in this market over the next several years. You are going to have to force yourself to be traders rather than investors. Anyone who is strictly an investor might as well put his money on a park bench somewhere and walk away. What the market doesn't get your broker will!
Find a market segment that suits you, study it like you have never studied anything before, and aggressively trade that segment.
I started studying a market in commodities ten years ago. I study it 4 or 5 hours a night every night. I started trading that market about 3 years ago and because of that relentless study I have never made a bad trade. Some have returned as much as 150%. And all the trades on the book look good; most I could cash a profit today, the rest-the market is coming to me.
States of America, you deserve it. You deserve the pain that You will feel today and You will feel next years.
States of America, here the shortest list of Your crimes before the face of GOD:
1. Your oil idolatry; oil's and oil products' pollution of the Earth. Oil is everywhere: in markets, in news, in politics, in economics, in internal and foreign policy of every government in the world. States of America, you made oil a matter of wealth, a tool of greed and a tool of corruption, a tool of bribing and a tool of sin.
2. Your computer idolatry; youn...(Read more of this comment)g men from all over the world are waiting of new processor, waiting for 'powerful' video chips to bring them into the distorted world of illusions
of computer 'games'. It is no more 'games' when young men kill others as a result of 'gaming'. And now You open in Israel the largest fabric of golden idolatry processors in the world, Fab28.
3. Your car idolatry. You reverse the odinary tool of transportation into the army of iron monsters, who steal million human lives each year arount the earth. These monsters are inhabitants of the oil. The other inhabitants of Your sinful oil are: tanks, aircrafts and rockets.
4. Your distortion of the meaning of LAW. Your 8000 pages of what you call 'tax law' is more sinful, is more idiotic than pharisees' interpretation of GOD's law 2000 years ago in Jerusalem. Your 'tax code' is more sinful than ancient pagan Rome empire's taxation with 200 taxes.
5. Your distortion of human rights last decades. States of America, you WERE the union of defendants of human rights. No more. You TWICE elected for leadership the person who is the liar, thief and who ruined human rights in your country and other countries.
http://www.smartmoney.com/tradecraft/index.cfm?story=Ultimate-Cost-of-Ba...
1. Shared with the rest of the world
2. See 1
3. See 1. Otherwise the country isnt developed enough, give it a few years. And dont compare the US to some freaking country the size of one of our states and say "But look at the mass transit systems here" or "You should ride your bikes more."
4. See 1.
5. See history of mankind.
6. @#%$ off.
This is not God's wrath. This is cause and effect.
USA is an inventor, main drive and champion on each and every point.
USA is a paganistic Empire, the world leader in idolatries.
There a some truths in this article but a lot of inaccuracies:
He talks about the lack of investor appetite for CMBS - this is to general a statement. CMBS investors are not terribly enthused about vintage CMBS, specifically 2005-2008 vintages, but are chomping at the bit for new issue CMBS. Additionally, other non-bank CRE lenders are becoming more and more competitive bidding on deals.
The problem is, and has been, the equity gap...most REIT CMBS borrowers probably have enough cash to fill the gap on some properties and will sell others to minimize the gap. Mom and Pop CMBS borrowers are the ones in trouble as they are cash strapped and have trouble affording advisors to negotiate workouts.
The fallout from CMBS will be the rich getting richer. REITs will strengthen their position by snapping up high profile properties being sold and Real Estate PE firms will purchase notes and REO from servicers who are selling notes and foreclosed REO. Everything is moving slow because servicers are over-worked.
The interesting development that has, and should continue to take place, is change of ownership and consolidation in the special servicing world. Buffet/Berkshire recently bought Capmark, Centerline recently sold their special servicing unit, and LNR (the biggest special) has been teetering on bankruptcy and may unload a huge portion of their servicing portfolio or be bought out entirely. If the special servicing duties are taken over by corporate parents that can afford to beef up staff then this slow process may quicken.
As others have said, the real problems are the bank loans...this article focuses on the wrong issues. Borrowers with ADC, transitional, and condo loans will be wiped out and the ultimate winners will be PE firms that buy notes and REO at huge discounts from the FDIC.
I just want to take a serious moment to thank you for publishing this kind of information.
This cite is a cortical treasure trove.
This gives me an idea for a cartoon...
WB7
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