Posted on 03/26/2009 8:20:02 AM PDT by an amused spectator
Edited on 03/26/2009 8:23:12 AM PDT by Admin Moderator. [history]
As Treasury Secretary Tim Geithner orchestrated a plan to help the nation's largest banks purge themselves of toxic mortgage assets, Citigroup and Bank of America have been aggressively scooping up those same securities in the secondary market, sources told The Post.
(Excerpt) Read more at nypost.com ...
If the government announced they were buying all pre-1990 cars for $1,000 each to get them off the road..we’d all be buying every piece of junk out there to turn a profit as well.
someone explain to me why the markets have been up so far when all the ‘fixes’ are all smoke and mirrors and more fraud from our government?
I would think that the market is figuring out that most of the problems with the economy have been created by the politicians talk and the media hype and that McCain was correct when he said that the fundamentals are strong. Market movement is greatly effected by perception; as soon as the public perceives improvement, the market should shoot up. Those buying now are betting on a positive perception in the near future.
And the socialist in our White House claims that we're going to make a profit on this bailout? That's only true if "we" refers to Obama and his corrupt buddies, not the American people.
Open Letter To The FDIC Ombudsman Karl Denninger on PPIP (March 23, 2009)
And now:
It Looks Like Citi And Bank Of America Are Already Gaming The System (C, BAC) John Carney - Business Insider
“someone explain to me why the markets have been up so far when all the ‘fixes’ are all smoke and mirrors and more fraud from our government?”
Maybe because the dollar is down?
Isn’t this exactly what was proposed in the first place? Let the banks dump bad stuff let it get cleaned and the banks pick up the clean stuff. It’s a workable solution.
Banks are into it to make money.
As a bank stockholder, I want them to make money.
If the gubmint is stupid enough to throw free money around, you bet I want my banker to be scooping that stuff up. It is what I pay him the big bucks for.
It’s all part of a pattern. Obama re-funds the banks, the banks, shares go up; Banks buy these toxic loan back, shares fall when the cash runs out and it has nothing but toxic collateral; Soro’s is sitting on the sidelines, with billions of shorted stock just waiting for the right moment to collect on, scooping up billions more of our future assets, guaranteeing America will be bankrupt well into the future, and his Marxist world government regime is well funded.
Either Denninger's full of baloney, or we're dancing on the edge of the precipice with several power-drunk idiots in charge of things (Bernanke, Geithner & Obama).
The market will do what the market wants to do - there are still massive toxic assets out there.
This is likely a signal that these players have inside information that the government is shortly going to abandon mark-to-market rules on these securities and go to some sort of valuation based on present value.
So, Bank of America and Citi are buying these securities at maybe 40 cents on the dollar, as opposed to the current mark-to-market valuations of 30 cents on the dollar (and often less). But once mark-to-market it suspended/abandoned/whatever, the values on these securities may rise to 60 cents or more on the dollar.
The beautiful thing for Bank of America and Citi is that if they buy a billion bucks worth of these securities, once the mark-to-market rules are a nullity, the value of the securities will rise to a billion and a half bucks, increasing their capitalization by a half-billion dollars almost instantly.
If they buy these securities using 10% of their own capital and borrowing 90%, then if they use a billion dollars of their own capital and buy 10 billion dollars of these securities, their balance sheet will grow by $5 billion on the $1 billion investment.
A quick way for them to recapitalize, repay the government what they borrowed under TARP, and get out from under the fascist controls being introduced by the anti-Christ Obama’s regime.
Simple, because there's money to be made. You make money buying and selling as the market goes up, and you make money short selling on the way down.
Open Letter To The FDIC Ombudsman Karl Denninger on PPIP (March 23, 2009)
Exactly. We have a winner!
All to bail out Timmy's buddies, and give them a nice little bonus as they skate out from under the gun they loaded and pointed at themselves.
Those people who don't actively trade loose their money. Otherwise those who watch the markets and buy/sell make money no matter which way the markets move.
That’s what really irks me. All those crooks are watching the henhouse. Anyone believe Soro’s ISN”T trading with inside info? Plus, he’s even so bold as to make statements about what Obama should do to prop up the banks, not that anyone believes Soro’s wants to see the financial picture to improve in America. He just wants to drive the markets up so it has greater volitility. The wilder the market fluctuates, the more money, and faster you can make it.
These people can manipulate the market anyway they want, and as a result never loose on a trade. The problem is proving it which is hard when they can have people far removed from them doing their trading.
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