2008 Redux

From Peter Tchir

Since this morning’s rant or comment, I have been informed of several other similarities:
•         No matter how far down we go, people are more concerned about missing a rally than the risk of another down leg
•         Bank CEO’s go on TV to calm shareholders and send letters to employees and the market reacts negatively
•         Rating agencies issue long lists of credit downgrades, MBS and CMBS then, sovereign and municipal debt related now
•         Pressure in the short term funding market are being talked about
•         No one can understand why CMBS isn’t down more
•         CDS is once again a 4 letter word
•         Mortgage Insurers (PMI) are back in deep trouble.
•         Fannie Mae is not government guaranteed.  Owned, yes, guaranteed, no.
I’ve also been informed of some key differences
•         Countries were in far less debt and austerity was not a commonly used word
•         EFSF didn’t exist and few people knew that the IMF wasn’t just for Emerging Markets
•         SOVX has been around for a few years, LCDX and ABX managed to drag down their respective markets much quicker
•         Alternative Method’s of Easing were just that, Alternative, as opposed to mainstream
•         China was doing incredibly well, and ghost town only applied to the old west
•         Companies have lots of cash on hand, after 2 years of record debt issuance
I am sure you will see a lot of other lists showing how different it is now.  They will likely be better thought out, but some of these may be food for thought.  I am not positioned as bearish as I sound, as some of the knee jerk reactions to rumors of bank insolvency seem overdone, but did feel the need to share some of the feedback I had received from earlier today, and maybe bring a smile to your face as it has now officially been a long week.  Long or short, or both, or in between, the volatility is taking its toll on people.


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