Lemme axe you guys who think this is nothing this. Wasn't BSC going to put 3.2bill in, and they put in 1.6 or so? Wuz up wit dat??? Why did they put anything up? Because they already committed themselves to some? Look at the 7/11 comment. I guess "0" is orderly. Search 3 months 6 months 1 year 2 years Search Results for Bear Stearns (BSC) Future Events Date Page Event 13-Sep-07 Earnings Next earnings release: Sep 13 before market, unconfirmed. Reuters Research estimate: 3.38 Results for In Play; last 3 months Date Page Article 17-Jul-07 17:49 ET In Play Bear Stearns: Moody's puts BSC Alt-A trust and bonds review for possible downgrade; says Alt-A deliquencies higher than anticipated-- BBerg -Update : 17-Jul-07 17:36 ET In Play Bear Stearns: Two Bear Funds nearly worthless Investors told-- WSJ (139.91 -0.40) : The WSJ report sthat, weeks after the meltdown of two prominent Bear Stearns Cos. hedge funds that bet heavily on the market for risky home loans, the brokerage has told the funds' investors that the portfolios' assets are almost worthless, according to people familiar with the matter. The assets in Bear's more-levered fund, the High-Grade Structured Credit Strategies Enhanced Leverage Fund, are worth virtually nothing, according to people familiar with the matter. The assets in the larger, less-levered fund are worth roughly 9% of the value since the end of April, these people said. The April valuations were not immediately available, but in March, before their sharp losses, the enhanced leverage fund had $638 million in investor money, while the other fund had $925 million. The WSJ is reporting that sources said Bear disclosed this information to investors earlier today and is expected to make a statement this evening. A spokeswoman for Bear did not return calls for comment... stock is trading at $136.02 in after hours. 11-Jul-07 10:02 ET In Play Bear Stearns: SEC'S Market Regulation Chief says BSC Hedge Funds able to "unwind in an orderly fashion" - Reuters (136.88 -1.08) -Update : 11-Jul-07 10:01 ET In Play Bear Stearns slides lower intraday as it sets up to challenge its late Jun/10-mth low of 136.13 (136.22 -1.60) -Technical : 11-Jul-07 10:01 ET In Play Bear Stearns: SEC's Mkt regulation Chief Sirri says BSC Hedge Funds will have "limited impact" on broader markerts - Reuters (136.38 -1.58) -Update :
!! It is the dialed up leverage. There is said to be about $1 trillion in CDSs for an underlying $20 billion in GM debt. like a futures market almost, much more size held than the value of the full underlying. The more leveraged fund of the 2 has to be in the red, especially if the less leveraged is only worth 9!! Who is on the hook for that, and what if someone did a Texas hedge, invested in this fund AND sold CDS against it. Can't pay the obligation now.
That is correct and why all this gloom and doom talk will amount to nothing just a few scare stories on the wires.
Yeah, that's why last time this story came on the wire the markets went heavy on the red and hundreds of millions of dollars were sold off. Buyers dried up and the market moved down quickly. It wasn't until Bear came out and said they were loaning the funds the money themselves until the markets stabilized and went back up...but certainly an Australian idiot who compares the Australian housing economy to the US housing economy must know more about it than Wall St.
remember the July 11 statement from Bear? The unwinding would be "orderly". I suppose this is orderly. Nice, clean, nothing left.
frankly it seems like the street saw this coming from a mile away. Looking @ the ABX indices charts(http://www.markit.com/information/affiliations/abx) the hedgies(betting on defaults) have been pressing swap prices down hoping for a break. The selling in the financials this am was probably a dead giveaway of the BSC news. This might put a bottom in on the ABX indices over the next few days. It will be fun to see this play out into expiry friday