Empiric Student Property Share Discussion Threads

[briarberry] 17/8/2007 10:57

A rush to pull out cash - Worried about the stability of mortgage giant Countrywide Financial, depositors crowd branches.

By E. Scott Reckard and Annette Haddad - August 17, 2007

Anxious customers jammed the phone lines and website of Countrywide Bank and crowded its branch offices to pull out their savings because of concerns about the financial problems of the mortgage lender that owns the bank.

"It's got my wife totally freaked out," he said. "I just don't want to deal with it. I don't care about losing 90 days' interest, I don't care if it's FDIC-insured -- I just want it out."

[briarberry] 10/8/2007 21:43

US property market...

quote

To be honest with all of you, I did not expect to see the market deteriorate this quickly. I was expecting real signs of distress in the fall and winter (I still think it will get much worse.) Real estate markets typically do not turn this fast. Of course, this is no typical real estate market.

The market decline of the early 90's was a slow deflation. There was no single period of intense panic selling; however, it really is different this time. These prices were bid up so high, with so little regard to fundamental valuations, and was played by so many people with so little to lose (100% financing) that it certainly appears as if it is going to behave like a traditional commodities market.

[briarberry] 10/8/2007 14:59

Fed p*ssing in the wind...

Aug. 10 (Bloomberg) -- The Federal Reserve added $19 billion in temporary funds to the banking system through the purchase of mortgage-backed securities to help meet demand for cash amid a rout in bonds backed by home loans to riskier borrowers.


The European Central Bank today loaned 61.05 billion euros, pumping funds into the banking system for a second day. The ECB added an unprecedented 94.8 billion euros yesterday.

[briarberry] 10/8/2007 12:03

how is the USA going to attract capital now that they have damaged investors confidence so badly ? now that everyone knows that the USA has been selling trillions worth of subprime toxic waste to investors


Business Comment: ECB's confidence trick won't restore faith in market

When confidence dissipates so does growth, economies go into reverse and people lose their jobs. We are witnessing the start of that second phase as confidence starts to leak out of markets, hissing out of the widening cracks in the financial system and into the ether.

[briarberry] 10/8/2007 00:40

Goldman Sachs Closing Market-Neutral Hedge Fund

Goldman Sachs Group Inc. (GS) is closing a hedge fund that oversees more than $700 million after recent losses, but the investment bank is keeping its largest hedge fund open, a person familiar with the situation said on Thursday.

The North American Equity Opportunities fund is shutting down after losses and has sold some of its positions recently, the person said, speaking on condition of anonymity.

Losses suffered by Goldman's largest hedge fund, the $9 billion Global Alpha fund, have sparked concerns that it could also close.

[briarberry] 10/8/2007 00:22

Aaron Krowne launches Hedge Fund Implode-O-Meter



same man...

[briarberry] 09/8/2007 13:40

credit problems met with inflation


ECB lends 95b euro overnight at 4%


Aug. 9 (Bloomberg) -- The European Central Bank said it will provide unlimited funds today at 4 percent after demand for cash in the European money markets drove interest rates higher.

A reluctance to lend money after concern over U.S. subprime mortgage losses roiled credit markets pushed overnight euro rates to as high as 4.7 percent today, compared with the ECB's benchmark refinancing rate of 4 percent. The rate for borrowing dollars overnight jumped to 5.86 percent from 5.35 percent yesterday.


"The European Central Bank, in an unprecedented response to a sudden demand for cash from banks roiled by the subprime mortgage collapse in the U.S., loaned 94.8 billion euros ($130.2 billion) to assuage a credit crunch."



Euro tax payers just became 95billion poorer today.

[briarberry] 06/8/2007 02:45

Doug Noland

I mostly downplayed the marketplace liquidity and economic impact of the housing downturn last fall and the subprime implosion this past February. For the system as a whole, the Credit spigot remained wide open. My view of current developments is markedly different. I cannot this evening overstate the dire ramifications for the unfolding Credit Market Dislocation. There is today serious risk of U.S. financial markets - distorted by years of accumulated leverage and derivative-related risk distortions - of "seizing up." A system so highly leveraged is acutely vulnerable to speculative de-leveraging and a catastrophic "run" from risk markets. At the same time, the Bubble Economy and inflated asset markets – by their nature – require uninterrupted abundant liquidity. The backdrop could not be more conducive to a historic crisis, yet most maintain unwavering confidence that underlying fundamentals are sound.

[briarberry] 03/8/2007 11:55

inflation

BEIJING, Aug. 3 (AP) -- China's government announced an investigation Friday of sharply rising food prices, accusing companies of hoarding and threatening social stability

Investigators will look into why prices of grain, vegetable oil, pork, beef, mutton, and poultry are rising so fast, the National Development and Reform Commission said on its Web site.

Food prices in June were up 7.6 percent from the same month last year, driven by a 74.6 percent jump in prices for pork, China's staple meat.

A Chinese consumer association asked the NDRC this week to look into increases of up to 40 percent in the price of instant noodles, suggesting that producers might have colluded to fix prices, according to state media.



in one week...

The average price of vegetables jumped 3.3 percent from July 23 to July 29 from the previous week thanks to short supplies and higher transport and storage costs in bad weather.

[ian56] 03/8/2007 08:37

As reported this week, US car sales were down 10% with US manufacturers off 19%.

Looks like US consumers are starting to feel the pinch.

Regards,
Ian

[ian56] 03/8/2007 08:37

Aug 2nd

Extracted from WSJ link below.

More than two-thirds of Americans believe the U.S. economy is either in recession now or will be in the next year, a new Wall Street Journal/NBC News poll shows. That assessment comes despite the fact the economy has experienced sustained growth with low inflation and unemployment and generally rising stock values ever since the recession that ended early in President Bush's tenure.



Regards,
Ian

[briarberry] 01/8/2007 06:15

July 31 (Bloomberg) -- Oddo & Cie, a French stockbroker and money manager, plans to close three funds totaling 1 billion euros ($1.37 billion), citing the ``unprecedented'' crisis in the U.S. asset-backed securities market.

(all around the world)

Macquarie Bank has warned two of its investment funds could lose up to 25 per cent, or $300 million, of their value as the fall-out from the United States' sub-prime loan crisis hits Australian shores.

[ian56] 01/8/2007 00:55

American Home goes bust.
A non sub-prime lender.



Regards,
Ian

[briarberry] 31/7/2007 23:49

NEW YORK (Dow Jones)--Bear Stearns Cos. (BSC), already forced to shut two
hedge funds that bet heavily on the risky subprime mortgage market, is now
facing big losses in a third fund that has roughly $900 million in mortgage
investments, according to people familiar with the matter.

The fund contains a range of mortgages, but only a small slice of them that are
considered subprime, the area that has given so many firms heartburn in recent
weeks. Unlike the two other Bear funds that are being closed, this fund is not
leveraged.

[briarberry] 31/7/2007 22:31

more funds going under, investors lose 57% in this one


Source: The Boston Globe.

"Sowood Capital Management, a $3 billion Boston hedge fund launched just three years ago by former Harvard endowment manager Jeffrey Larson, sold most of its holdings in troubled debt markets yesterday after telling investors that it had losses of more than 50 percent this month."

"Sowood told Bloomberg News last week that it did not hold any subprime mortgage debt in its portfolio. Nonetheless, it said its devalued bond holdings thrust it into a liquidity crisis and it was forced to sell securities to meet margin calls."

"Last night an investor said Sowood had told clients it had lost 57 percent of its value and was being 'completely liquidated.'"

"'A loss of this magnitude in such a short period is as devastating to us as it is to you,' Larson, said in a letter to investors. 'We are very sorry this has happened.'"

[briarberry] 30/7/2007 12:21

D.R. Horton hit by $823 million loss

No. 2 homebuilder reports its first quarterly loss as a public company; revenues suffer from lower values of land and other assets.

[briarberry] 27/7/2007 18:50

Spending on commercial construction projects rose at the fastest pace in 13 years, helping to overcome another drop in homebuilding.



From Frederick Lewis Allen's book on the Great Depression, "Since Yesterday".

This is his description of the real estate environment on September 3, 1929, the day the stock market peaked:

"You will not be able to go far, in the central part of any of the big cities, without hearing the deafening clatter of riveters, for although the Florida boom went to pieces in 1926, and the boom in suburban developments---which has been filling up the open spaces in the outskirts of the cities with Cotswold Terraces and Rosemont Groves and Woodmere Drives---has been lagging since 1927, the boom in apartment-house construction and particularly in office-building construction is still going full tilt. Not in the poorer districts are the riveters noisiest, but at the centers of big business and of residential wealth, for it is the holders and manipulators of securities who are the chief beneficiaries of this last speculative phase of Coolidge-Hoover prosperity."

[briarberry] 27/7/2007 15:01

US Q2 GDP - it's hard to imagine that inflation growth fell 1.5% (4.2-2.7) just as inflaton seems to have peaked in Q2

Real GDP - Q/Q change - SAAR
Consensus 3.2 %
Actual 3.4 %
Prior 0.7%

GDP price index - Q/Q change - SAAR
Consensus 3.4 %
Actual 2.7 %
Prior 4.2%

[briarberry] 26/7/2007 13:09

quote

the bond market is going right down the tubes - spreads are 20-30bps wider today and any bid is getting creamed...this is the worst i have ever seen including 91, 98 and 02.

the street is crumbling under inventory, traders are getting called back from vaca and guys are getting tapped on the shoulder (not to get down but fired).

[briarberry] 25/7/2007 23:05

Apple - earnings up - outlook down...

AAPL 0.92 vs. 0.72e (earnings up)

They lowered guidance to 0.65 from 0.84e for Q4



aapl now quoting a $150

[ian56] 25/7/2007 21:28

Countrywide CEO

House prices falling faster than at any time since the Great Depression.

Regards,
Ian