Rigged? What do you mean rigged? Rigged as in "everything they tell us is bullshit"? How does it being rigged help me make money?
Total B.S. as most of you have mentioned. First red flag; they had to make an early announcement. Think about the reasons as to why that'd be. Now that the FASB rules have been so relaxed to the point that there's literally no transparency as to the solvency of bank balance sheets, they get to play with valuations in a way that would make Enron smile in envy. Unemployment keeps rising, default rates on homes and consumer credit lines keep rising, credit is contracting still, and this is a fantasy land the banks have been given free reign to romp around in. No matter. Even with the old rules of the game thrown out, the truth will still filter through. Don't fail to appreciate the irony of Wells Fargo announcing alleged 'blowout' earnings (while not having to mark assets to market) while jumbo loan losses rose to the highest level in history, and on the same day Walmart falls short of lowly analyst expectations on top line sales and revenue (their same store sales fell). http://www.bloomberg.com/apps/news?pid=20601087&sid=aI0_OFz22Ycs&refer=home We're going to end up with 11% unemployment, minimally, on a national basis soon, and the second wave of both residential and commercial property defaults have been building behind the 90 day moratorium banks so graciously agreed to when they came begging for TARP funds. Now, Insurance Companies want in on TARP and FHA is giving ominous warnings that it may need an AIG-scale bailout. When the truth on Wells Fargo comes out (that they've had a short term bounce in revenue due to refi activity, while not having to take the true amount of write downs due to laughable accounting rules), look for a sharp reversal, especially when WFC has to report that its assets are worth less than even the relaxed FASB rules allow it to report (or not report, more appropriately) at this point.
Accepting that itâs rigged. Once you come to accept that you can mute your feelings. A lot of people stand on the side lines because they think the market is rigged. WELL GUESS WHAT IT IS RIGGED. Yesterday the Treasury said they had the results of the stress test but were going to wait till after earning season to report as not to disrupt the markets, hummm. Well toady we here everything is great all banks passed the stress test and low and behold Wells Fargo just happened to announce earning are SUPER!. So do you think this was all a mere coincidence?
If WFC didn't show incredible earnings I would be incredibly pissed. We have spent so much money and rigged the financial world so much in their favor if they blew this they should have been shot. The government gave them permission to say whatever they want to for the value of their stank ass loans. The government has handed them unbelievable amounts of cash. The gov has pour money into driving the mortgage and bond rates to incredibly stupid levels causing an eruption of refi's and new loan origination, while handing bleary eyed idiots free grant money as a down payment on their first place. They have reduced the rates on savings to 0% while making the loan percent charged 5.75%+. I wish I were a banker. It's a goldmine right now.
Goldman Sachs : Level 3 Assets were approximately $ 66 billion as of November 2008 ( down from $ 68 billion as of August 29, 2008 ) and represented 7,5 % of total assets Morgan Stanley : level 3 assets were $ 78,4 billion as of 31 August 2008 8% of total assets Merrill Lynch : level 3 assets $ 61 billion, 7 % of total assets as of Nov 5th 2008 JP Morgan : as of 31.12.2008 6 % of total assets represent level 3 assets Wells Fargo : couldn´t find any figures as % of total assets
I happen to believe that the reason for the WFC profit and the reason for the banks passing the stress test is due to the relaxation of Mark to Market accounting rules, not because "the markets are rigged". Shorts should have got the fuck out as soon as the FASB announced the changes. Bank profits inevitably will rise because of this.
and relaxing the rule in order to benefit the banks is not manipulation??? why didn't they relax them 2 years ago?
I'm trying to find the NPAs growth to the provision growth, if there is a gap(coverage ratio not adequate) then this means the bank will have to play catch-up and they are effectively swaping beating a current quarter for a miss/capital raise in the future
Let's be clear, I have been against changing the Mark to Market rules from the very beginning. Assets should be valued at market value. But I hate the fact that so many people were calling for changes to the Mark to Market rules, then FASB relaxed the valuations, now the banks are posting profits as expected. As a result of this, the same people who were screaming for changes to the rules are now screaming RIGGED! MANIPULATION! Take this analogy: If Bernie Madoff had told you his investments were a big scam would you still invest money with him? Of course not! --------> The FASB announces changes to rules that will benefit banks. Do you still short them? Of course not!