Goverment considering creation of entity to hold bad debt

Discussion in 'Wall St. News' started by kxvid, Sep 18, 2008.

  1. From what I've read, the 1990s RTC found it very difficult to price and settle all the bad debt from the Savings & Loans.

    My guess is the infinitely more complex and exotic debt instruments from the last few years will drive the new RTC crazy.

    If history is a guide, I guess the original RTC "worked." Then again, it set the stage for the Greenspan put and belief that the Feds will always bail markets out.

    I'm not surprised by the initial (bullish) reaction, but it's very hard to say what this means in the longer-term.
    #11     Sep 18, 2008
  2. I sold every listed security I own [save for IBKR]. I won't be party to this incredible fucking scam. I refuse to trade any US market. Heading to Malta.

    Long 100% in EURUSD from 1.4292, unleveraged. Buy gold on this dip and don't sell it.
    #12     Sep 18, 2008
  3. dorfman


    well, at least things can get back to business as usual

    now that they've put their losses on the backs of the taxpayer, they can get back to outsourcing his job
    #13     Sep 18, 2008
  4. Speechless.... cannot speak..
    #14     Sep 18, 2008
  5. "I sold every listed security I own [save for IBKR]. I won't be party to this incredible fucking scam. I refuse to trade any US market. Heading to Malta.

    Long 100% in EURUSD from 1.4292, unleveraged. Buy gold on this dip and don't sell it."

    I am with you Atticus. Same line of thought. I had to act quick to get on the right side during that fake rally. I played it nicely I might add. However I didnt' "enjoy" the money per se as if the move was based upon something of proper valuation and fundamentals and not Paulson(or some one), making a call to GS(and others) to hit the buy button. Alot of folks sold into this fake "strength". I was out any long postion in index options before the bell. I am only long Gold and Silver miners and the ETF's GLD and SLV. Tomorrow it gets real ugly becuase nothing that the FED and/of the Gov. does is credible or beleivable. The move monday by the FEd to accept poor quality assets for lending at the discount window and this news today spells the potential total collaspe of the US Dollar.

    If you want your cash in a account based upon buillion, the Perth Mint is an excellent choice. While FIAT currencies lose value, you money gains, check it out, it's the best escape hatch.:)
    #15     Sep 18, 2008
  6. Thanks for the advice. So hot I need to hit something. Bumped the EURUSD long to 5x leverage from 1.4301 average. Looking to buy Gold tonight.
    #16     Sep 18, 2008
  7. I started hitting the GLS options last Friday when I found the bottom on spot Gold at around 5 O'Clock in the morning(CST) at around 754. Bought the GLD Sep 85 and 86 calls and then went beserk! 100% and then 100% and then 3600% wednesday). Sold at the fake rally and looking to buy up the Otc calls tomorrow! Miners are all oversold, GG, SLW are the best, several other good ones. The call options on SLW spiked in the last hour and the PPS held it's own. Great co.(pure silver play) and will go up from here.

    I am out to enjoy the day and the impending dollar collaspe. Go ahead FED and print more money. When folk's buying power goes to next to nothng and a mob is in the streets, do not say I didn't warn ya. They should have just let the DOW go to 9K a year ago and all these banks to collaspe. Just throwing more bad money at bad money and making the situation worse.

    Hey guys, take a breath and enjoy the day. Sell rally tops and short the market to oblivion. Cheers!
    #17     Sep 18, 2008
  8. 160 million households in the United states
    average home price is about 200k

    multiply that together and you get 32 trillion dollars worth of homes.

    40% of all homes have no mortgage so that means 19.2 trillion dollars of mortgages.

    SO its not that much of bad paper. Assuming 10% and its 1.9 trillion of bad paper and since homes have only gone down 50% in value, that means out of 1.9 trillion, 950 billion can be recovered.

    Oh wait... i didnt factor in the average home price in 2006, but assuming it was 400k (i know it wasnt but im just doubling todays avg home price) Then that would mean about 3.8 trillion of bad paper of which 1.9 trillion can be recovered. So its bad, but its not 100s of trillions of dollars like you think. If it was that means every american(man woman and child would be responible for 1.8 million of that debt.
    #18     Sep 18, 2008
  9. Well, I just did some math on the debt owed America by other nations. With interest (some of the debt is generations old), it comes to about half a quadrillion dollars, the same amount as above. Yes, I know the US forgave lots of debt, but serious economic pressures demand serious solutions. We did it to the Indians, so what the hell. I would only charge interest on debts through the dates they were forgiven, but would still adjust to current values.

    A quadrillion dollars is a million billion dollars.

    Transfer our debt to the nations who never paid us back, mostly for WWII and similar aid. Such a figure is quantifiable. England et al owe us a pile of dough, while Iraq owes the most. I would exclude Israel, for reasons obvious to knowledgeable people.

    This is how America will declare bankruptcy protection from its creditors and recover. Any other hard ideas? Criticism is welcome, but criticism without a better idea is just idle talk. Acceptance of such a debt load to citizens would be like taking a monkey on your back of paying child support for a dozen kids, all of your life, for every man, woman, boy and girl ever to be born in America. All courtesy of your inflationary friends at the Federal Reserve corporation and your globalist buddies in the white house from 1970-present. Have a nice day.
    #19     Sep 18, 2008
  10. Cutten


    IMO if implemented properly, this marks the start of the turn in fundamentals. The economy will still seem crap, but right there the authorities have stopped pissing into the wind with pointless half-measures, and are now actually doing something structural and significant, working more in unison.

    I don't know if it's the end of the bear market, but it's at least the beginning of the end.
    #20     Sep 18, 2008