Ping!
Does the other side really have the cash? Or is this $1T that is “out of the money?”
I’ve read an article saying that the likely cost of the bailout will be $2.5 trillion and at least $1.3 trillion.
Glenn Beck had someone on tonight saying $2.7 and $1.3 trillion respectively.
This is going to be a fun ride. For anyone who doesn’t know, $2.7 trillion is roughly the amount the government spends per year already.
Depending on the CDS reactions, this bailout could turn out to be the biggest financial disaster of all time. I wonder how this will affect Collateralized Debt Obligations; I assume CDOs are closely related to the CDS market, but not entirely sure how.
So how many normal people were helped out by this bit of corporate welfare.
Just the beginning. Extreme leverage in derivatives. Unknown dependencies to fall out of the sudden shock to the system. Quants never figured in that FNM and FRE would go bankrupt.
A great big house of cards is about to come down. The treasury just pulled a couple of floor level players.
The scariest words in the English language are: "I'm from the Government, and I'm here to help."
I have a bad feeling about this. A very bad feeling.
Another bunch of money grabbing sobs trying to cash in. Ok, I have 50 major credit default dealers who unanimously agreed that a credit event did not occur. We will get our lawyers together and talk about it for the next 100 years; at which time, a trillion dollars will be worth a buck ninety five and the debt will be settled!
Welcome to the Socialist States of America where nobody is allowed to fail.
Perhaps Juan should have realized the potential for unintended consequences (!!!) when he advocated a taxpayer-funded FNM/FRE bailout.
But, of course, why should the politician care, since he won't have to pay for any of the damage? And, he still gets votes!
1. Government bailout is going to be horrifically expensive. ("Horrific" not even really scratching the surface of how bad it really is.)
2. No government bailout could wind up being even worse.
3. No one has any other options.
Am I missing something, or are we just catastrophically screwed at this point? It seems that the damage has already been done, and that sans some amazing developments in time travel technology, we can't undo a bit of it. As much as I'd like to jump on McCain and Obama about this, I don't really know what else they are supposed to do?
Capitalism is the new Socialism!! Whoo-hoo!!!
What are you going to do about it you pieces of *bleep*? Suck more blood from us?
Bunch of corrupt incompetents.
Hold it! My brain is leaking fluid. I've even done CMO's in the past, but I guess I didn't understand the risk. For the results to have been so horrific, I just don't see that is that bad out there.
Lets say you buy a house for $300 a sq ft, that was $100 a sq ft last year. When the loan resets, you lose the house, the bank takes it and sells it for $125 a sq ft. It's still not ZERO! Even if they get $90 a sq ft, its still not worthless. Take the write down and get on with bidness. We must have loaned money to every wino and illegal alien in Mexico to lose this much money. I don't get it.
I sold my family’s sizable positions in PIMCO 6 weeks ago not knowing jack that this was coming.
Gross has sure turned whiner trying to save his bacon.
One has to suspect that whomever had the losing side (a) had the money, and (b) had reason not to complain.
Perhaps the loser was us.
See MISH'S Global Economic Trend Analysis: Big Non-Event In Fannie, Freddie Credit Default Swaps for further explanations of what's going on here, and why it might blow over so quietly.
So just how bad is this?