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To: John McCarthy who wrote (107676)2/1/2010 8:35:26 PM
From: ggersh   of 115618
 
This could be why Bear Stearns went down. Where's the justice!

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To: mishedlo who wrote (107688)2/1/2010 8:36:41 PM
From: dave9   of 115618
 
I've been a drunken sailor and completely agree with Paul. Paul, well said. I'll tip a glass of cognac tonight for you.

Yes, I've been hammered. Never spent more than what was in my pocket for the experience and left a bit $ at the barracks so I could eat until next payday. Actually, I would put a predefined amount in my pocket (and hide some emergency cash) for the adventure. Never spent like a slut congressman.

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To: mishedlo who wrote (107665)2/1/2010 8:40:12 PM
From: Keith Feral   of 115618
 
fanniemae.com 

I like the chart on household debt service falling from the peak in 2007 on pg 4. Lower priced housing costs is the best thing for an affordable economy. Finally, stable prices at firesale prices are finally becoming an economic push in the right direction, assuming the banks have reserved for the losses.

Deflation becomes a good thing after so many years. It all gets back to common sense, and a little bit of growth. Banks are lending less money because housing has become more affordable over the past 5 years. The less money necessary for housing, the more money to be saved and spent in the rest of the economy.

It's not much of a shock to see GDP improve 5.7% last quarter as the housing inventory continues to decline. The shadow inventory is probably a net positive for the economy too, which will build another year or two of affordable housing prices.

The big question is how to maintain 20 years worth of affordable housing. More likely, the question is how oil prices stay below $80 for the next couple of decades. Controlling debt is easy (foreclosure), controlling commodity prices might be another issue.

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To: fishweed who wrote (107689)2/1/2010 8:45:16 PM
From: Jim McMannis   of 115618
 
WOW. What is Plan E? Indian snow dance?

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From: Yulya2/1/2010 9:13:51 PM
   of 115618
 
Parents, students on edge over soaring tuition
By DONNA GORDON BLANKINSHIP, Associated Press Writer Donna Gordon Blankinship, Associated Press Writer

SEATTLE – As students around the country anxiously wait for college acceptance letters, their parents are sweating the looming tuition bills at public universities.

Florida college students could face yearly 15 percent tuition increases for years, and University of Illinois students will pay at least 9 percent more. The University of Washington will charge 14 percent more at its flagship campus. And in California, tuition increases of more than 30 percent have sparked protests reminiscent of the 1960s.

Tuition has been trending upward for years, but debate in statehouses and trustee meeting rooms has been more urgent this year as most states struggle their way out of the economic meltdown.

The College Board says families are paying about $172 to $1,096 more in tuition and fees this school year. The national average for 2009-2010 is about $7,020, not including room and board, according to the nonprofit association of colleges that oversees the SATs and Advanced Placement tests.

Mike Sarb, a University of Illinois senior from suburban-Chicago Elk Grove Village, Ill., says money is a big concern for his blue-collar family scrambling to find the money to pay more than $20,000 for tuition, room and board.

They are not pleased that university officials are likely to raise tuition 9 percent this summer.

"They do complain that the school's taking advantage of people (by raising tuition)," Sarb said.

But interim President Stanley Ikenberry says the school has run out of options. With a budget deficit expected to top $11 billion this year, the state of Illinois owes the university more than $430 million, money he doesn't expect to see any time soon.

In some cases, one student's tuition disaster is another's bargain.

State officials have told Florida students they can expect 15 percent tuition increases every year until tuition reaches the national average. That could be a long slog, as the state is starting its tuition realignment from a place other students envy — about $3,000 a year.

In California, unprecedented budget cuts to higher education have led to huge fee increases at the state's two public university systems, as well as layoffs, furloughs, enrollment cuts and reduced course offerings.

At the University of California, which has 10 campuses and about 220,000 students, in-state undergraduate fees in fall 2010 are set to reach $10,302 — 32 percent more than in fall 2009 and three times what California residents paid 10 years ago.

But at California State University, the nation's largest public university system with 23 campuses and 450,000 students, resident undergraduate fees rose 32 percent from fall 2008 to fall 2009 to $4,026, which is nearly three times what students paid 10 years ago. Gov. Arnold Schwarzenegger's budget proposal for 2010-2011 assumes that the system will raise fees another 10 percent in the coming academic year.

"We're paying more and getting less," said Steve Dixon, a Humboldt State University senior who heads the California State Students Association.

At the University of Washington, where tuition and fees are expected to pass $9,000 by the 2010-2011 school year, students are worried about threatened cuts in financial aid as well.

"It's kind of a perfect storm for students," said Jono Hanks, a political science major from Everett, Wash., who is the UW student government lobbyist at the statehouse this quarter.

Hanks lives at home, packs his lunch and pays tuition with work and about $4,000 in student loans a year. Others have told him they're looking for a second job and adding to their debt to keep up with this year's 14 percent tuition increase.

"Some of them are even talking about dropping out for a few years so they can pay off the loans they have," Hanks said.

The Seattle university expects to raise tuition another 14 percent next year. UW tuition used to double every decade. At 14 percent a year, it could double in five.

Hanks is almost finished with school so he's not that concerned about his ability to pay for the last few quarters of his degree. But he does worry what barrier tuition increases will pose for his younger sister and brother, who are both in elementary school.

Other states have been more subtle in their budget balancing attempts.

The University of Wisconsin-Madison is in the first year of a four-year tuition increase plan aimed at improving quality. In addition to statewide tuition increases of about 5.5 percent, in-state students at UW-Madison will pay an extra $250 a year each year.

This year, tuition went up by $617 to $7,296 or about 9.2 percent, but financial aid increased at the same time.

Still, few are complaining because the extra money — $100 million in the first four years and $40 million each year afterward — is reserved for providing more classes, improving student services and increasing need-based financial aid.

The Georgia Board of Regents has suspended indefinitely its popular "Fixed for Four" guaranteed tuition program, which since 2006 has meant students have paid the same tuition rate annually for four years of college. A freshman at the University of Georgia this year pays $3,865 in tuition and fees per semester if they take between seven and 15 hours of classes.

Some students are relieved at modest tuition increases this year, including 3.5 percent in Ohio, less than 5 percent in Pennsylvania, and 3.9 percent at the University of Colorado at Boulder.

So far a few states, like Oklahoma and Missouri, have avoided tuition increases entirely. And the Oklahoma Legislature gave its state universities no reason to complain when it fulfilled the state higher education budget request.

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To: ggersh who wrote (107690)2/1/2010 9:22:37 PM
From: Hawkmoon2 Recommendations   of 115618
 
This could be why Bear Stearns went down. Where's the justice!

Could be? It's pretty well common knowledge that CDS arbitrage, combined with the FASB M2M changes, were responsible for this rape and pillage.

Yes.. the IBs and RAs were packaging sh*t and rating it as gold, but the Hedgies were buying the CDS, (naked?) shorting the crap out of the underlying asset, and then shorting the financials to boot, in order to make them scramble for more capital.

It's the primary reason that CDS MUST come under regulation like any other form of insurance.

The difficulty lies with how to create international standards that will be upheld by all the players.

The first place to start is that only people with "insurable interest" on the asset should be able to purchase and sell CDS.

But there must also be transparency in those markets.

Until CDS are under control and regulated, anyone issuing debt is just asking to have that debt targeted for a CDS "pile-on" and shorting of the actual debt.

Hawk

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From: Yulya2/1/2010 9:25:19 PM
2 Recommendations   of 115618
 
President Obama said ( during his State of the Union address)

"We’re working to lift the value of a family’s single largest investment -- their home [..]"


David White said...

The government has made an enormous assumption in crafting its policy on housing: It assumes that maintaining values is of the utmost importance. It’s a tragic mistake.

The proper way to manage a credit bubble is to destroy errant debt issued beyond the capacity of the borrower. This means that some subset of all mortgage debt issued after 1990 is invalid. It’s a fiction and a fantasy. It is a dead-weight loss issued to fools who believed in real estate as an investment.

Our highest priority must be to bring down the house of cards. We should encourage foreclosures. We should encourage default. We should bring overhead down. Our first goal must be inexpensive housing.



newobservations.net 

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To: Hawkmoon who wrote (107695)2/1/2010 9:30:27 PM
From: ggersh   of 115618
 
Exactly, but as the article states Bear didn't play along, then
Paulson gets pissed and is the biggest short, while GS made a
killing. Then Hank bails them out big time. It all stinks!

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To: ggersh who wrote (107697)2/1/2010 9:42:44 PM
From: Hawkmoon   of 115618
 
Exactly, but as the article states Bear didn't play along

I found that interesting. Paulson actually approached Bear and they refused to play ball.

Sounds to me like some previous employee of Bears could become a star witness.

"At Bear Stearns, however, Scott Eichel, a senior trader, and others met with Mr. Paulson and later turned him down. Mr. Eichel said he felt it would look improper for his firm. "On the one hand, we'd be selling the deals" to investors, without telling them that a bearish hedge fund was the impetus for the transaction, Mr. Eichel told a colleague; on the other hand, Bear Stearns would be helping Mr. Paulson wager against the deals."

Here's the original article, btw:

online.wsj.com 

huffingtonpost.com 

And yes.. it does all stink. But CDS are the creation of JPM. And now they want to follow up that disaster with trading Carbon Credits. Blythe Masters apparently created both of them:

"Masters says banks must be allowed to lead the way if a mandatory carbon-trading system is going to help save the planet at the lowest possible cost." And derivatives related to carbon must be part of the mix, she says. Derivatives are securities whose value is derived from the value of an underlying commodity -- in this case, CO2 and other greenhouse gases""

zerohedge.com 

Hawk

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To: ggersh who wrote (107690)2/1/2010 9:48:24 PM
From: John McCarthy   of 115618
 
g

Why won't SOMEBODY start with this?

affidavit
en.wikipedia.org 

The only guy that actually does anything with
this kinda of financial SHIT is New York Atty. Gen. Andrew Cuomo.

Where the f#@$% is the SEC?

regards
John

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