Posted on 09/25/2008 7:05:39 PM PDT by Sam_Damon
JPMorgan Chase acquired the banking operations of Washington Mutual Bank in a transaction facilitated by the Federal Deposit Insurance Corporation. All depositors are fully protected and there will be no cost to the Deposit Insurance Fund.
"For all depositors and other customers of Washington Mutual Bank, this is simply a combination of two banks," said FDIC Chairman Sheila C. Bair. "For bank customers, it will be a seamless transition. There will be no interruption in services and bank customers should expect business as usual come Friday morning."
JPMorgan Chase acquired the assets, assumed the qualified financial contracts and made a payment of $1.9 billion. Claims by equity, subordinated and senior debt holders were not acquired.
"WaMu's balance sheet and the payment paid by JPMorgan Chase allowed a transaction in which neither the uninsured depositors nor the insurance fund absorbed any losses," Bair said.
Washington Mutual Bank also has a subsidiary, Washington Mutual FSB, Park City, Utah. They have combined assets of $307 billion and total deposits of $188 billion.
Thursday evening, Washington Mutual was closed by the Office of Thrift Supervision and the FDIC named receiver. WaMu customers with questions should call their normal banking representative, service center, 1-800-788-7000 or visit www.WaMU.com. The FDIC's consumer hotline is 1-877-ASK-FDIC (1-877-275-3342) or visit www.fdic.gov.
any idea what the fnm/fre spike down at roughly 2:10 was about? 50% drops in tandem on nothing I could find. Looked like a case of 2 huge sell orders being given to a gopher clerk to execute (or margin call forced liquidation, often just as sloppy.)
...there is nothing illegal about having a very large seller sit on the stock.
Agreed. But if a large seller is sitting on a stock, the ask size would pretty consistently exceed the bid size by a goodly amount; exactly the opposite was taking place today, and yet the price still declined. My view is that the huge bid sizes were fakes, window-dressing, from the specialist (or maybe from some electronic trading desk).
A good example I watched more closely was what was probably Greenberg selling AIG today - they used mm FLOW and just killed the stock, and would NOT let it up until some guy on cnbc yakked about it. I wouldn’t be surprised if he sold far more than 10 million shares today.
Hank was on CNBC last week whining about his losses. He lost something like $6 billion, I believe, but even after that, remains a billionaire. Tough to feel sorry for the guy.
“Agreed. But if a large seller is sitting on a stock, the ask size would pretty consistently exceed the bid size by a goodly amount; exactly the opposite was taking place today, and yet the price still declined. My view is that the huge bid sizes were fakes, window-dressing, from the specialist (or maybe from some electronic trading desk).”
You are wrong. Those huge bids were hit and printed on the tape. Look at time and sales, and heck, the volume the stock traded.
The seller(s) used what is called a reserve-price order, where they only show a certain number of shares to the market, which is continuously refreshed as shares are sold. He might have showed 50,000 offered, but in reality had millions to sell in the system. Thus big bids, not so big offers, but stock goes down.
“Hank was on CNBC last week whining about his losses. He lost something like $6 billion, I believe, but even after that, remains a billionaire. Tough to feel sorry for the guy.”
I have no opinion on this. I just want to trade the stock, and understand when/if large natural sellers are in the market.
I will note that I would like to be able to work an order like the large sellers in aig or wm had today just once. Tens of millions of shares to sell, would be a ton of work and maybe fun.
And the trader got rebates too!
reserve-price order
Hmmm. Got a link for info on this?
““Hank was on CNBC last week whining about his losses. He lost something like $6 billion, I believe, but even after that, remains a billionaire. Tough to feel sorry for the guy.”
I have no opinion on this. I just want to trade the stock, and understand when/if large natural sellers are in the market.”
I also wish he would go ahead and file his form 4 so it would be clear how much he has left to sell.
i am a moron, here it is
he sold 5million direct, and an entity Starr International sold 35million, I assume they are affiliated with him.
the link has all types of orders described
http://www.nyse.com/equities/nysearcaequities/1157018931913.html
Reserve Order
A limit order that replenishes the displayed order size as executions are received, up to the total order quantity; away markets are routed at their quoted size or larger (if applicable) when hitting the bid or taking the offer. Reserve orders look only at protected quotes.
Thanks...
In WaMu's case, the FDIC set a Wednesday evening deadline for interested parties to submit their offers for various parts of WaMu. Twenty-four hours later, they were already preparing to seize the bank. Earlier this month, Treasury Secretary Henry Paulson made it clear to WaMu that the company should have accepted the takeover deal J.P. Morgan had offered earlier this year, according to a person close to WaMu.
The main players at JP Morgan knew full well on Wednesday evening that they were preparing to buy the plum assets of Wamu on Thursday evening after the close of the market, and so, if those players knew it, a significant number of other key Wall Street players knew it, too, including the WM NYSE floor specialist. The way trading went Thursday was carefully calibrated to suck in buyers for WM stock, buyers who were out of the loop of insider knowledge. The after-hours WM price plunge was a surprise only to the little retail investors who rarely have a clue (I'll include myself in that bunch).
That's my take, anyway...
“The main players at JP Morgan knew full well on Wednesday evening that they were preparing to buy the plum assets of Wamu on Thursday evening after the close of the market, and so, if those players knew it, a significant number of other key Wall Street players knew it, too, including the WM NYSE floor specialist. The way trading went Thursday was carefully calibrated to suck in buyers for WM stock, buyers who were out of the loop of insider knowledge”
Your analysis of trading in WM from a previous post is based on lack of knowledge of electronic trading platform mechanics. It really is a different world - I hadn’t seriously traded listed stocks in years, and now am seeing exchanges and ecn’s I had never even heard of (ISE (the options exchange, now doing listed), and FLOW (who the f is flow?) I have to find badge numbers for all these mmid’s too :(
Trading in WM on thursday went against all normal stock behavior, and clearly showed large natural sellers in the stock. I certainly don’t dispute this.
Claiming involvement of the specialist may rise to slander. I don’t know what he knew, and neither do you. Since shorting is illegal in this stock, any such knowledge would have a limited set of possible beneficiaries. These days, specialists are only a limited part of listed stock trading. NYSE specialist as a career field is not what it was 5 years ago - their age, as far as I can tell, is done.
Anytime a stock goes straight down because sellers relentlessly lower their offers, buyers are ‘sucked in.’ Sucked-in buyers in a stock widely regarded as overdue for FDIC seizure should expect surprises. Has anyone actually claimed WM is worth more than zero, based on their level 3 account contents?
It was clear WM would be gone in some form or other *very* soon. Many more people than ‘little retail investors’ were surprised by the details of wm’s demise, though not by the fact of it.
Seriously, obviously very connected people knew something was coming down the pipe imminently and thus sold, but this was not something a lot of folks knew in detail - the stock would have traded at 50c immediately. The street does not know mercy when it comes to discounting known future events.
Seriously, obviously very connected people knew something was coming down the pipe imminently and thus sold...
That's my main point. I do know that electronic trading is taking over and that many computerized trading platforms are at work in the markets, making trades based on black-box algorithms and the like. But nothing beats insider knowledge, and I believe that it's a dead certainty that we saw that knowledge at work in Wamu's trading Thursday.
Fortunately, I didn't lose much (although I would have if I hadn't had an order ready to send through during the after-hours session). But many little people had their heads handed to them. It's a damned shame. But there have been many of those in the market in recent days and weeks and months and years...
“That’s my main point. I do know that electronic trading is taking over and that many computerized trading platforms are at work in the markets, making trades based on black-box algorithms and the like. But nothing beats insider knowledge, and I believe that it’s a dead certainty that we saw that knowledge at work in Wamu’s trading Thursday.”
Agreed on this. Natural sellers presumably knew the end was at hand. You don’t see the type of dedicaated selling in a stock like we did in wamu without external motivation, be it margin call/forced liquidation, coffee clerk handling the order, or the end of the world (which was the case for wamu). The seller(s) would not let the stock up even a nickel until like 1pm or soemthing.
SEATTLE, WA (September 24, 2008) – Washington Mutual, Inc., one of the nation’s leading banks for consumers and small businesses, has once again been recognized as a top employer by Hispanic Business magazine and the Human Rights Campaign.LOL! We may be bankrupt. Buy, hey, we're DIVERSE!Hispanic Business magazine recently ranked WaMu sixth in its annual Diversity Elite list, which names the top 60 companies for Hispanics. The company was honored specifically for its efforts to recruit Hispanic employees, reach out to Hispanic consumers and support Hispanic communities and organizations.
http://corner.nationalreview.com/post/?q=MDQzYjA4ZWYyZDYyNjY0ODZjZmE1NzRkMWI3MWZiZGU=
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