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Iridian Asset Management Devotes Entire Q3 Update Letter To MBS Crisis
More and more hedge funds are starting to not only look and be concerned by the "MBS Crisis" but are using it to determine their investing strategy. To wit from Iridian Asset Management: "Our typical quarterly letter has three parts. We describe our current macro view of the world, discuss briefly a current investment theme, and conclude with an examination of micro-market dynamics. Our goal with this structure is to share with our investors what we are seeing from the front lines of the global capital market battleground. But rather than write one more description of the pros and cons of QE 2, rather than write one more post mortem of the SEC report on the Flash Crash or the pernicious impact of correlation on stock picking, we have decided to devote this entire letter to an in-depth review of an investable theme that we are currently researching and acting upon: the mortgage backed securitization (MBS) crisis of 2010. This theme also has secondary and tertiary macroeconomic implications, and therefore influences our portfolio-wide views on risk and exposures."
Full must read Iridian Opportunity Fund – 3rd Quarter 2010 Letter (pdf)
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Off topic, but good:
http://endoftheamericandream.com/archives/the-television-commercial-abou...
"During times of universal deceit, telling the truth becomes a revolutionary act" - George Orwell
I sure hope these Iridian guys are right.
The old me would've came to the same conclusion... but knowing how corrupt the world is, I'm becoming much more skeptical.
fraud is... fraud.
http://www.fcic.gov/hearings/pdfs/2010-0921-William-Black.pdf
This is an extraordinary article Tyler. Thank you.
An brilliant and very useful read to help us laymen really understand what is currently going on. Thanks.
The banks will still buy their way out of it somehow and fuck the rest of us anyway.
Grayson's comments are excellent too:
Fraud Factories: Rep. Alan Grayson Explains the Foreclosure Fraud Crisis
http://www.youtube.com/watch?v=AqnHLDeedVg&feature=player_embedded
Grayson is no more...
http://www.miamiherald.com/2010/11/02/1905330/grayson-loses-central-fla-...
Okay, for the people more educated in finance than me, what are the investment vehicles Iridium is using on those rascal banks, long puts on individual stocks or an etf, or some kind of bet on CDS's?
the question is actually good - short BAC, servicer etc... but there must be something bigger than this... read:
"That said, the wheels of justice may grind slowly, but they grind extremely well. If we are correct in our
analysis, we are not playing for 10% gains here and 5% gains there. We are playing for credit defaults and
bankruptcies, for – if not a systemic risk – then at least a mortal threat to important actors within the
system. And the current macro-driven investing environment notwithstanding, we believe that the market
is still an effective anticipatory mechanism for specific catalysts impacting specific companies … we do
not believe that we will have to wait two to three years to get paid on our ideas if we are right."
"These are not crowded trades, and we believe that plenty of liquidity exists for an exit if we are wrong."
In my option this hedge fund beta on the total collapse of the United States... Short US Treasuries secs, Short USD and if wrong there is enough liquidity to unwind the trades. Since this is quite tough statement from my side, glad to hear your critical option.
don't forget the trillions of securities issued from Fannie Mae and Freddy Mac... they also need to buy them back from investors and who is gonna pay for this - the FED which will finally end up as the sole owner of US treasuries and MBS;)
Boy, I wish I had enough money to play around with stuff like that -- and didn't need it to eat and buy gas and foolish shit like that.
What public companies are the author talking about. Servicers, Agents, or the Big Banks? Public ones?
Pretty good comprehensive read.
Intersting prediction of a 2-3 year legal clash between the Titans. To this day, I scratch my head wondering why BAC swallowed up Countrywide. Greed and stupidity are my first assumptions. My second assumption is a Treasury/ Fed doublecross of Lewis to quickly adopt the fraudulent enterprise on the cheap with what we now know is a wholly inadequate and underestimated Tarp I backstop. Same goes for JPM/Wamu.
Countrywide was a parasite that BAC willingly swallowed....!! Now the big boy is being eaten away from the inside out. Mozzillo gets a $ 65 million handslap and the biggest American Bank slips slowly under the waves.
Behold the wages of greed and corruption.......DESTRUCTION.
Simple. When you are insolvent and depend on the Fed, you do what they want or you become the sacrificial lamb.
WOW!
Game over for at least BAC.
Sheeeeeeit.
WB7, we need a picture of Jamie in a gutter swilling Mad Dog.
thanks - the document explains all the issues in a plain and easy language, but comprehensive though - nice one!
They know the next hammer is coming out to hit this economy and they are running scared.
Iridian's investment thesis appears to be predicated on the assumption that the rule of law will prevail, that justice will be served, and that the parties guilty of hundreds or thousands of counts of felonies will ultimately be held accountable for their crimes.
Fools...
THANK YOU THANK YOU for the real .pdf attachment instead of just a POS flash viewer.
del
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