S&P, Moody's Hide Rising Risk on $200 Billion of Mortgage Bonds

Discussion in 'Wall St. News' started by ASusilovic, Jun 29, 2007.

  1. http://www.bloomberg.com/apps/news?pid=20601087&sid=aN4sulHN19xc&refer=home

    Rosner estimates that collateralized debt obligations, which have packaged thousands of bonds and derivatives into new securities, will lose $125 billion. Institutional Risk Analytics, a Hawthorne, California-based company that writes computer programs for the four biggest accounting firms, says 25 percent of the face value of CDOs is in jeopardy, or $250 billion.

    Oh, oh....big trouble ahead ??:confused:
  2. ah the infamous black swan finally appears.

    this is going to be fantastic.

    reverse leveraging and forced selling are two of the funniest things to watch in a market at the same time.

    i would suggest to all you are about to watch history in the making here.

    this will make the savings/loans crisis and the ltcm debacle look like a walk in the park.

    if people want to make money out of this trade quite simply buy the credit spreads.

    that is what i have done.
  3. airwalk

    airwalk Guest

  4. The Real Money columnist confirms the "80 pt markdown story " today.

    Also, a contact spoke to an exchange official who confirmed same.

    There is not enough equity in the CDO's to cover the debits; it rolls to equities, and everything else.

    What a nice job the regulators and politicians did on this one. Don't say we didn't warn them.