DrStool Posted July 11, 2008 Author Report Share Posted July 11, 2008 The thought of a government takeover of the GSEs will crash the bond market. Bills will lag a bit, but the point of recognition is near that there is no "safety" in T-bills. Once the flight to safety panic subsides I expect rates to explode to the upside. They really have to stop this talk of a government takeover of Fannie and Freddie. The cure will be worse than the disease. The market already thinks that there's a government guarantee behind these guys. That's bad enough. We are on the doorstep of the collapse of the government bond market if they nationalize Fannie and Freddie. Link to comment Share on other sites More sharing options...
lineup32 Posted July 11, 2008 Report Share Posted July 11, 2008 The thought of a government takeover of the GSEs will crash the bond market. Bills will lag a bit, but the point of recognition is near that there is no "safety" in T-bills. Once the flight to safety panic subsides I expect rates to explode to the upside. They really have to stop this talk of a government takeover of Fannie and Freddie. The cure will be worse than the disease. The market already thinks that there's a government guarantee behind these guys. That's bad enough. We are on the doorstep of the collapse of the government bond market if they nationalize Fannie and Freddie. 672952[/snapback] interesting post from a financial blog: a bit and a link: "This is the first time in my career that I truly believe U.S. Treasury bonds sold off on credit concern. By this I mean, the credit of the U.S. Government. Long time readers know I'm not an alarmist type, and I'm sure not saying the United States is going belly up, but credit default swaps on the United States of America moved 11bps wider today (from 9bps to 20bps). The 10-year Treasury moved 15bps higher. All on a day when people are scared shitless and there should have been strong demand for "risk-free" assets." http://accruedint.blogspot.com/ Link to comment Share on other sites More sharing options...
Peek Paper Posted July 11, 2008 Report Share Posted July 11, 2008 interesting post from a financial blog: a bit and a link: "This is the first time in my career that I truly believe U.S. Treasury bonds sold off on credit concern. By this I mean, the credit of the U.S. Government. Long time readers know I'm not an alarmist type, and I'm sure not saying the United States is going belly up, but credit default swaps on the United States of America moved 11bps wider today (from 9bps to 20bps). The 10-year Treasury moved 15bps higher. All on a day when people are scared shitless and there should have been strong demand for "risk-free" assets." http://accruedint.blogspot.com/ 672953[/snapback] Ahem ..... Link to comment Share on other sites More sharing options...
Drano Posted July 11, 2008 Report Share Posted July 11, 2008 FDIC takes over Indymac. Nitely Bidness Report sez it's late-breaking nooz. Link to comment Share on other sites More sharing options...
Charmin Posted July 11, 2008 Report Share Posted July 11, 2008 um. RUT 4.51 in the green while everything else is red. 672924[/snapback] IWM's got to break hard for a crash. Those dang speculators Link to comment Share on other sites More sharing options...
Jetlag Posted July 11, 2008 Report Share Posted July 11, 2008 When I read this post on the board I was flabbergasted by the numbers: "Wholesale prices rose 11.89 percent in the week to June 28, after gaining 11.63 percent in the previous week, commerce ministry spokesman Rajeev Jain told Bloomberg News in an interview today. Economists expected an 11.75 percent increase." 11.89 percent in a week? Can't be, only in Zimbabwe. Maybe it's annualized like the USandA GDP reports, crazy thing to do, butt it would be a more "reasonable" number. http://www.bloomberg.com/apps/news?pid=new...id=ajTwWRbKkrVg Fortunately they have new graphs with all the data for our viewing pleasure. http://www.bloomberg.com/apps/cbuilder?ticker1=INWHOLE:IND Calfigurating the price index there is a YoY rate of 11.89 percent and the weekly rate is 0.42% which annualized is 24.47% per annum. So prices didn't "rise 11.89 percent in the week to June 28" they rose 11.89% YoY and if they keep rising at this weekly rate for 12 months that will be 24.47% YoY. And yes that's a lot, some hyperinflation definitions say a 100% increase in prices over 3 years is hyperinflation. Link to comment Share on other sites More sharing options...
Bungster Posted July 11, 2008 Report Share Posted July 11, 2008 IWM's got to break hard for a crash. Those dang speculators 672958[/snapback] From Traderfeed... http://traderfeed.blogspot.com/ With the GSEs falling like a stone and further selling among such financial shares as LEH, it made sense that today's market would be in the toilet. While the S&P 500 Index (top chart) was making fresh lows for the week, however, the small cap Russell 2000 Index (bottom chart) remained well above the horizontal blue support line from the 7/8 lows. The market today was weak, to be sure. My preliminary numbers show 268 NYSE, NASDAQ, and ASE issues making new 20-day highs today, against 2366 lows. The number of new lows, however, on Monday was 3276 and on Tuesday was 2390. In other words, while the financial, housing, and consumer discretionary sectors were leading the large cap index lower late in the week, other market segments were not participating in the weakness. When we get moves to new lows in which many stocks are not participating in the breakout, the odds of reversal are enhanced. This is what we saw late in the day today. If this is part of a larger bottoming process, we'll need to see buying interest come into the market early in the week. For intraday traders, however, the moral of the story is to look, look, look at the level of participation in any market move: the rising (and falling) tides that fail to move all boats are the most suspect. Link to comment Share on other sites More sharing options...
Jetlag Posted July 11, 2008 Report Share Posted July 11, 2008 It's official http://www.bloomberg.com/apps/news?pid=206...0T7U&refer=home "IndyMac Bancorp Inc. became the second-biggest federally insured financial company to fail today after a run by depositors left the California mortgage lender short on cash." Do you have cash on hand? Or are you waiting for the bank runs? Link to comment Share on other sites More sharing options...
Charmin Posted July 11, 2008 Report Share Posted July 11, 2008 "11.89 percent in a week? Can't be, only in Zimbabwe." 672959[/snapback] Oh yeah, if all you drink is milk and eat small pizza's then in 10 days the cost of buying those two items hit you in the gut at my local Walmart. Milk goes from $3.05 to $3.88 Pizza goes from $1.00 to $1.25, but it takes 4 of them to satisfy family hunger. Link to comment Share on other sites More sharing options...
Jetlag Posted July 11, 2008 Report Share Posted July 11, 2008 Oh yeah, if all you drink is milk and eat small pizza's then in 10 days the cost of buying those two items hit you in the gut at my local Walmart. Milk goes from $3.05 to $3.88 Pizza goes from $1.00 to $1.25, but it takes 4 of them to satisfy family hunger. 672962[/snapback] If they keep rising 11.89% per week that's 34346.59% per annum. I wish I could have gains of 12% a week. And your milk rising at that rate per week will cost $762239.75 in a year. "One milk shake please!" Oh, and don't forget, inflation is a fancy name for taxes. That money is going from your pocket directly into the bailout of finaglers and other government boondoggles. Link to comment Share on other sites More sharing options...
Charmin Posted July 11, 2008 Report Share Posted July 11, 2008 It's official http://www.bloomberg.com/apps/news?pid=206...0T7U&refer=home "IndyMac Bancorp Inc. became the second-biggest federally insured financial company to fail today after a run by depositors left the California mortgage lender short on cash." Do you have cash on hand? Or are you waiting for the bank runs? 672961[/snapback] My mom has most of her money at Indymac. One less high paying CD rate payer to deal with. Link to comment Share on other sites More sharing options...
Drano Posted July 11, 2008 Report Share Posted July 11, 2008 If they keep rising 11.89% per week that's 34346.59% per annum. I wish I could have gains of 12% a week. And your milk rising at that rate per week will cost $762239.75 in a year. "One milk shake please!" 672963[/snapback] Pikers. If you want to see the full potential of milk cartons, go here: http://i130.photobucket.com/albums/p243/cedmundcross/081.jpg this is from the annual milk carton boat race in Minneapolis. Link to comment Share on other sites More sharing options...
Jetlag Posted July 11, 2008 Report Share Posted July 11, 2008 My mom has most of her money at Indymac. One less high paying CD rate payer to deal with. 672964[/snapback] I hope all depositors get all their money back. Be sure to tell your friends and family about FDIC insured levels (like they did on this board some time ago), just to be sure and safe from the reckless finaglers. Link to comment Share on other sites More sharing options...
Jetlag Posted July 11, 2008 Report Share Posted July 11, 2008 Pikers. If you want to see the full potential of milk cartons, go here: http://i130.photobucket.com/albums/p243/cedmundcross/081.jpg this is from the annual milk carton boat race in Minneapolis. 672965[/snapback] Drano, those aren't milk cartons, it's wads of butt wipes aka paper money. Link to comment Share on other sites More sharing options...
mdporter Posted July 11, 2008 Report Share Posted July 11, 2008 The indymac news made the news on the radio. Thought of everyone here immediately. This is only the first bank to go. Other major california lenders like wamu and downey could face the same fate. Link to comment Share on other sites More sharing options...
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