[dennisw]

FYI...Australia is just now writing down these things, while the US has been doing it for more than 6 months. Just wait.. China and the other Asian companies have loads of this stuff that they still have not written down.

We aren't writing down or admitting these CMOs are only worth 10% of original value
They are being kept on the books as dubious crap with no numbers assigned to them

[skipper18]

And our pension funds are stuffed full of this worthless garbage, which they paid full price for and are still pretending are worth their face value.

As the boomers start withdrawing as we enter the 1st retirement wave next year (how many million are retiring again?), the funds will have to start trying to sell them to meet withdrawels.

At which point they almost all go belly-up.

We’re beyond screwed.

[Pearls Before Swine]

We aren't writing down or admitting these CMOs are only worth 10% of original value

No, we aren't. I don't believe ALL mortgage backed securities are worth only 10% of their original value... just some. Some of the oddball tranches, which carry high initial interest and high risk to various factors, should never have gotten AAA ratings. Without knowing exactly what they bought, it's hard to comment intelligently on their situation, or to extrapolate it to the economy as a whole. If it is really true, we should all be hitting the panic button.

I read somewhere else (WSJ, I think) that 80 cents on the dollar is the rule of thumb being used to value Level 3 assets (those without a liquid market)on investment bank books these days. That's a long way from 10.

[Ron Jeremy]

We aren't writing down or admitting these CMOs are only worth 10% of original value They are being kept on the books as dubious crap with no numbers assigned to them

OK, my general point was that the incremental bad news, for the last 6 months, has been coming from the US. Going forward, I think most of the incremental bad news will be coming from outside the US.