my take on this is some of these funds had 500 million in capital but levered that to 20 billion in paper......that was on the books at par......... trouble is, what pricing discovery is there when you try to auction off the stuff and nobody responds.......... so liquidity dries up and what's the stuff worth? ergo..liquidity panic......
Notice noobs. Not one word about his 3244 accounts, many not only wiped out, but at a neg balance. My sources tell me these guys were huge naked shorters helping out Canadian scumbags. No apologies. This is Wall St. It's all about them. Brookstreet Securities says closes after CMO losses Fri Jun 22, 2007 2:16pm ET NEW YORK, June 22 (Reuters) - Brookstreet Securities Corp., an Irvine, California broker-dealer, closed its doors on Friday after heavy losses in the collaterialized mortgage obligation market, terminating at least 650 independent brokers, the firm's president said. Brookstreet President Stanley Brooks said the firm faced heavy markdowns over the last two weeks in its CMO investments held in margin accounts and was forced to close. Brooks said the firm had a value of about $17 million at the end of May which has evaporated. He said he turned down several tentative offers to recapitalize the firm. "I am flabbergasted," said Brooks, 59. "My life's work is gone." This is going to expose all the warts all over. This is Cramers' swansong, as he seems to have taken the mantel of BSC apologist. Flush the toilet, and we'll start over.
Wall Street has had a number of hot product waves that created a lot of revenues on the front end...however the underlying instruments were rather vague... The downshift always occurs when a little time has passed...and the opaque investments have to be marked to market... Right now...they are trying to establish the highest mark to market that they can...with what amounts to less than third world debt bonds.... The real question is...how did these pseudo third world debt bonds receive the quality ratings that tempted investors in the first place... There is over $1 trillion in this debt category....and is a prospective legal nightmare.... There is always a lot of front end greed with the major Wall Street firms....and they will form every legal maneuver they can ...to lose as little money as possible...while putting the legal headaches to the buyers....This is an old WS game... Not to knock the system....Its just a Wall Street thing...... Trust Me ....is not exactly a trustable option ...regarding WS.....
a trillion here... a trillion there....after awhile it starts to add up to a taxpayer bailout........
Me too. I hate banks. Bloodsuckers. I hope they lose billions. I would like nothing better then to see a 3000 point drop in the dow over a couple weeks. John
It doesn't really bother me, I have millions, the markets are just a hobby, i don't need the money. My money management system trades from zero. I'm making 10k a month absolutely risk free trading currencies, bonds and commodities. It's all based on 'flight to quality'. Totally obvious if you have the cash and have a really simple knowledge of global fundamentals. No need for any crazy systems based on one futures market and 10k, for me. See you in the big 'Monte', and good luck.
OHhhhhhhhhhhhhhhhhhhh REALLY!? Please tell, I'll get the popcorn to hear about the "risk-free" trading.
OHHHHHHHHHHHHH REALLY?!?!? You should use those "miilions" you have to buy a lying coach...you need practice.