Comments for Fed Expands TALF to include more Securities
CRbot says:
This comment thread has been HALO-IZED by CRbot.
http://realize.org/cr/halokit.php?halourl=http://www.haloscan.com/comments/calculatedrisk/5914323708865358607
CRbot Thu Mar 19 15:41:41 2009 CDT #
Nemo says:
I wonder if I can use my '97 Civic as collateral.
Nemo Thu Mar 19 15:41:53 2009 CDT #
ScroogeMcDuck says:
nemo!
ScroogeMcDuck Thu Mar 19 15:43:24 2009 CDT #
CRbot says:
The Latest from Denninger:
FLASH: Geithner ADMITS To Exception Demand
CRbot Thu Mar 19 15:45:20 2009 CDT #
Michael says:
So when does he get Fired?
Parent Post
Michael Thu Mar 19 15:55:25 2009 CDT #
reptillian says:
I once read the Fed's charter and think that it mentioned direct loaning to the people. It's about time. Let's cut-out the middlemen.
reptillian Thu Mar 19 15:45:30 2009 CDT #
Automonkey says:
Why don't they set up a stall in every city with a slogan: "We overpay for crap". I am sure there will be a line.
Automonkey Thu Mar 19 15:45:57 2009 CDT #
Nemo says:
Getting tired of JS-Kit eating comments...
I keep seeing the phrase "avoidable foreclosures", but I have no idea what it is supposed to mean, exactly. Anybody know?
Nemo Thu Mar 19 15:47:28 2009 CDT #
Angry Saver says:
I wonder if I can use my '97 Civic as collateral.
Absolutely. And the best part is that the fed will pay more than any other buyer. It's part of the new win-win (e)CONomy. You can't lose. Bring on the LEVERAGE!
Angry Saver Thu Mar 19 15:48:03 2009 CDT #
Rob Dawg says:
"Security."
I do not think that word means what it used to mean.
Rob Dawg Thu Mar 19 15:48:24 2009 CDT #
reptillian says:
Habitat for Humanity getting into teardowns!
reptillian Thu Mar 19 15:48:39 2009 CDT #
Show me the money says:
kitchen sink?
Show me the money Thu Mar 19 15:49:33 2009 CDT #
briwerk says:
"Row Dawg writes: I do not think that word [Security] means what it used to mean. "
Add the word, "Freedom" to that list also.
briwerk Thu Mar 19 15:50:05 2009 CDT #
Kung Fu Panda says:
Why bother with the rating of the ABS? Everyone knows the rating is garbage.
Kung Fu Panda Thu Mar 19 15:50:13 2009 CDT #
Automonkey says:
So.. The Fed will buy existing crap ABS from whoever is holding it now. They will take that money and do exactly what with it? Buy treasuries? Where can anyone get a decent return these days? Some kind of retarded tax incentivized renewable energy projects? We are building an inefficiency bubble with tax credits. Its wonderful.
Automonkey Thu Mar 19 15:50:45 2009 CDT #
Anonymous says:
is there any chance of going back to the old comments systems?
Anonymous Thu Mar 19 15:51:17 2009 CDT #
cd says:
posted this in previous thread...
interesting read...
http://www.businessweek.com/ap/financialnews/D9712FK81.htm
Lau said the government's numbers don't reflect the severity of the situation because many factories have closed but they're still in the middle of the arduous process of shutting down a plant. He reckons that about 2,000 to 3,000 factories began the process in the third and fourth quarters of last year.
cd Thu Mar 19 15:51:28 2009 CDT #
giacutter says:
When I was a kid growing up, a local mattress and bedding store was run by a guy that ran commercials as "bargain Bernie". He pretended to be crazy, saying he would sell mattresses at 'insane' prices.
Every time I hear a new announcement from the Fed, I think of "Bargain Bernie" and his "crazy deals".
Don't know why, just do.
giacutter Thu Mar 19 15:51:47 2009 CDT #
Michael says:
Does Todays Market Slide Signal the Next Leg Down?
Michael Thu Mar 19 15:53:48 2009 CDT #
Nemo says:
Automonkey --
The Fed will buy existing crap ABS from whoever is holding it now. They will take that money and do exactly what with it?
Make more similar loans. With FedLeverage™, even a tiny spread multiplies into big hedge fund profits. And the best part is, the money comes from nowhere. All winners, no losers!
Nemo Thu Mar 19 15:54:47 2009 CDT #
JimPortlandOR says:
I sure could use some Talf for my tender buns (oh, wait, maybe I mean talc).
Why bother requiring that the 'assets' be bundled into Asset Backed Securities. A Federal Reserve branch bank in the city would be fine with me to use as a replacement for Bank (Robber) of America.
As long as they use/allow electronic banking, that is. Branch physical facilities are a waste of depositors potential interest returns. One branch per major city would be fine for when you want to take in your empty briefcase or backpack and take all your 'money' in Benjamins.
JimPortlandOR Thu Mar 19 15:55:15 2009 CDT #
Kung Fu Panda says:
Here's someone to complain to re comments:
"JS-Kit, a startup that develops a series of widgets that can be quickly integrated into websites, has raised $3.6 million in a Series B funding round led by Altos Ventures, with existing investor TEF3 also participating. The company says that it will use the funding to expand its team of engineers, along with the addition of DataPortability’s Chris Saad as Strategic Advisor."
A few expressive calls or emails to the VC's office might be satisfying, at least.
Kung Fu Panda Thu Mar 19 15:55:31 2009 CDT #
REBear says:
Banksters replace TARP with TALF so that they can keep their bonuses.
REBear Thu Mar 19 15:57:41 2009 CDT #
Anonymous says:
http://www.merriam-webster.com/dictionary/implosion
implosion
Anonymous Thu Mar 19 15:59:11 2009 CDT #
Vinny The Nose says:
Yeah, I gotta few IOUs from customers of my loanshark... er...lending business, and Benny the Beard is taking them off my hands at primo values.
Vinny The Nose Thu Mar 19 15:59:17 2009 CDT #
Basel Too says:
fed should have insisted that lenders using credit card ABS agree to the credit card reforms due next year. bankers and institutional investors win. little guys lose. :(
Basel Too Thu Mar 19 16:04:47 2009 CDT #
Barking Up A Tree says:
Here is an interesting list of next generation collateral from bernanke, which focuses on Tax Payers speculating on futures:
http://en.wikipedia.org/wiki/List_of_trading_losses
:-P
Barking Up A Tree Thu Mar 19 16:05:27 2009 CDT #
Nemo says:
JimPortlandOR --
Why bother requiring that the 'assets' be bundled into Asset Backed Securities. A Federal Reserve branch bank in the city would be fine with me to use as a replacement for Bank (Robber) of America.
Not sure if your question is rhetorical...
The Fed is not making loans directly to businesses or consumers. They apply a haircut (search for "collateral haircuts" in the FAQ) to the ABS in order to reduce the credit risk assumed by the central bank.
Incidentally, I agree with you about BofA. Bank of America is a criminal enterprise.
Nemo Thu Mar 19 16:05:30 2009 CDT #
nades says:
Can anyone explain to me what a "floorplan loan" is?
WTF!
.................
nades Thu Mar 19 16:06:08 2009 CDT #
Some Investor Guy says:
And if the securities cease to be AAA?
Some Investor Guy Thu Mar 19 16:06:41 2009 CDT #
nades says:
that wont happy on timmay's watch...
the problem with debt is its just so damn hard to get rid of... :-E
Parent Post
nades Thu Mar 19 16:08:10 2009 CDT #
sbarrkum says:
DitchTheDollar says:
Today, 04:18:20 PM
“From Reuters
<dl>MOSCOW -- China and other emerging nations back Russia's call for a discussion on how to replace the dollar as the world's primary reserve currency, a senior Russian government source said on Thursday.</dl>
As does the UN.
U.N. panel says world should ditch dollar
LUXEMBOURG (Reuters) - A U.N. panel will next week recommend that the world ditch the dollar as its reserve currency in favor of a shared basket of currencies, a member of the panel said on Wednesday, adding to pressure on the dollar.
Currency specialist Avinash Persaud, a member of the panel of experts, told a Reuters Funds Summit in Luxembourg that the proposal was to create something like the old Ecu, or European currency unit, that was a hard-traded, weighted basket.
sbarrkum Thu Mar 19 16:08:06 2009 CDT #
reptillian says:
AIG Employees Feel The Wrath
But, we mustn't forget that the bonuses are just a drop in the bailout bucket, which may have a gaping hole in its bottom.
reptillian Thu Mar 19 16:08:18 2009 CDT #
Basel Too says:
there is way too much money being paid to manage institutional funds (and what you usually get is a "manager" investing exclusively with another manager). sigh
Two top advisers to Alan G. Hevesi, the former state comptroller, were charged on Thursday in a 123-count indictment that said they had turned New York’s $120 billion pension fund into a criminal enterprise that netted them and other Hevesi associates tens of millions of dollars in kickbacks from firms investing the fund’s money.
http://www.nytimes.com/2009/03/20/nyregion/20morris.html?pagewanted=1&hp
Basel Too Thu Mar 19 16:08:51 2009 CDT #
Bob Dobbs says:
"Habitat for Humanity getting into teardowns!"
It's money for them in two ways, win-win. First, they're getting a subsidy to do it. Second, some chapter maintain salvage yards of usable building material/fittings that they can either reuse in projects or donate to other nonprofits who are trying to build/rehab low income housing.
Finally, they're most likely improving a low-income neighborhood and making it more liveable, and that's well within the bounds of their mission.
Like I said in another post, down my way, our (small) chapter of HFH is looking to buy a cheap REO to rehab, maybe build a granny unit on the same lot and make it a duplex.
Bob Dobbs Thu Mar 19 16:09:29 2009 CDT #
Interesting Times says:
Can I swap out the fillings in my teeth? How about some of my boy's used toys?
This is AWESOME !
Interesting Times Thu Mar 19 16:10:01 2009 CDT #
snacky says:
short answer: "floorplan loan" is a loan to auto dealers to finance their car inventory
snacky Thu Mar 19 16:10:09 2009 CDT #
nades says:
thanks. (i'm in construction and thought it was based on 'floor plans' or drawnigs or something.... blood pressure is returning to normal...)
Parent Post
nades Thu Mar 19 16:17:06 2009 CDT #
Kung Fu Panda says:
cd,
That BW piece on China was very good. It's no surprise that orders aren't materializing, but the turnaround in Chinese companies' need to actually try to sell rather than just take orders emphasized the change. I think that chances of unrest will be high this summer when it will be obvious to all in China that American demand didn't come back and 2009 will be a complete disaster. It will be quite a turnaround from the triumphalist Olympic mood.
Kung Fu Panda Thu Mar 19 16:10:47 2009 CDT #
Nemo says:
nades --
Yeah that was a new one on me, too. Here is what I found.
Nemo Thu Mar 19 16:11:02 2009 CDT #
nades says:
from Nemos link "However, when the liquidity crisis hit, the floorplan securitization market froze up just like a lot of other credit markets. Institutional investors stopped buying floorplan securitizations or offered to buy them only at prices at which the floorplan lenders could not afford to sell."
I love it how people still refer to this "freezing of the credit markets" like its something that is completely unrelated to the fact that there are tooo many damn cars out there....
People need to realize its not a financial flu, the good producing economy is sick. "Fixing the credit markets" wont help bring rates down to levels that dont reflect the risk associated with bad business decisions...
........................
Parent Post
nades Thu Mar 19 16:23:16 2009 CDT #
Barking Up A Tree says:
That dude said it well:
"Treasury Secretary Timothy Geithner said Thursday that he takes responsibility for knowing the stimulus legislation had a loophole that would allow bailed-out insurance giant American International Group to keep its bonuses.
In an interview with CNN's Ali Velshi, Geithner said the Treasury Department did talk to Sen. Chris Dodd about a clause he put forth that would have strictly limited executive bonuses.
So Dodd was telling the truth - he was pressured by Treasury, and apparently, Geithner didn't bother to tell his boss (the President, of course) about it up front.
Tim, there are mistakes and then there are really big mistakes. The latter demand resignations.
This is one of them.
Time to resign Tim; cheating on your taxes is bad enough, but funneling over $100 billion of taxpayer money to your banking friends, and over $160 million to the employees who blew up the financial world, is a bridge too far."
Barking Up A Tree Thu Mar 19 16:11:18 2009 CDT #
NYCityBoy says:
I said in November that Geithner would ruin Obama's presidency. This was on another blog. I stated that the mere nomination was destroying Obama's credibility. None of the Obama supporters agreed. Not a single one would question Obama. It was like I was in the middle of the Jonestown crowd. They couldn't even consider questioning their Leader.
One of the most vocal idiots on this other blog wrote, just two days ago, "I love Obama". He was serious. The Obama supporters are just as scary as the Bush supporters. They are two peas from the same pod. Obama's presidency is dying in the crib and Geithner is standing over the infant holding a meat cleaver.
NYCityBoy Thu Mar 19 16:11:34 2009 CDT #
Max says:
there is way too much money being paid to manage institutional funds (and what you usually get is a "manager" investing exclusively with another manager). sigh
Next one on the list: CalPERS.
Max Thu Mar 19 16:12:02 2009 CDT #
reptillian says:
Fed to buy 1 Trillion in debt
reptillian Thu Mar 19 16:12:53 2009 CDT #
nades says:
I'm still a little confused about how they are buying all this debt? More debt right? Sounds a little like BSC to me....
Parent Post
nades Thu Mar 19 16:18:28 2009 CDT #
Anonymous says:
The Citi stockholder never sleep.s
Anonymous Thu Mar 19 16:13:30 2009 CDT #
reptillian says:
"can someone explain what a floorplan loan is?"
I sell apples on a cart, downtown. A floorplan loan is gov't money
that lets me pay for my apple inventory, so I have something to sell, even though no one wants apples.
reptillian Thu Mar 19 16:16:10 2009 CDT #
Anonymous says:
reply
delete
edit
moderate
Interesting Times says:
Today, 5:10:01 PM
Can I swap out the fillings in my teeth? How about some of my boy's used toys?
Only the rich and the politically well-connected get as much of the monopoly money. All the little people have to work for it like it was real.
Anonymous Thu Mar 19 16:17:04 2009 CDT #
Lawyerliz says:
An avoidable foreclosure would be one where the borrower was current, and saw that all the houses around him were being sold at half the amount of the mortgage he owed, and getting somewhat seedy in the neighborhood, and the lender couldn't get more than half anyway, and they sensibly realized this and bargained with the owner to not only lower the rate, but cram down the balance to say, 60% of the amount owed, which would leave the owner still underwater, but with hope that sometime before the Apocalypse he would break even, and be grateful because now his mtg payment would be really affordable.
Lawyerliz Thu Mar 19 16:18:15 2009 CDT #
Basel Too says:
From the OCC:
Floor plan, or wholesale, lending is a form of retail goods inventory financing
in which each loan advance is made against a specific piece of collateral. As
each piece of collateral is sold by the dealer, the loan advance against that
piece of collateral is repaid. Items commonly subject to floor plan debt are
automobiles, large home appliances, furniture, television and stereo equipment,
boats, mobile homes, and other types of merchandise usually sold under a sales
finance contract.
Basel Too Thu Mar 19 16:19:24 2009 CDT #
Some Investor Guy says:
"floorplan loan"?
It's a method of financing dealer inventory. It's not the dealer's inventory (e.g., Ford of BFE, or Circuit City of Flatrock). Instead, it is the manufacturer's inventory, or the finance company's inventory. The dealer is charged to have it on the lot, or on the showroom "floor".
Some Investor Guy Thu Mar 19 16:20:14 2009 CDT #
poic.v20 says:
"thanks. (i'm in construction and thought it was based on 'floor plans' or drawnigs or something.... blood pressure is returning to normal...)"
Dont worry nades, that's not for atleast another couple of months :-E
poic.v20 Thu Mar 19 16:20:22 2009 CDT #
nades says:
poic - i posted this yesterday but its worth repeating.
i'm now bidding on a mini-mart. yep! we've gone from 800MM hospitals to mini-marts in a little less than a year.
lots of girm faces here. and still way to much optimism...
Parent Post
nades Thu Mar 19 16:26:36 2009 CDT #
CRbot says:
New Thread: Banks Sell Some REOs in Bulk below Market Prices
http://www.calculatedriskblog.com/2009/03/banks-sell-some-reos-in-bulk-below.html ( 0 comments ...You could be FIRST! )
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CRbot Thu Mar 19 16:21:46 2009 CDT #
energyecon says:
This gem been posted yet?
Goldman to detail AIG trading relationship Friday
By Greg Morcroft, MarketWatch
Last update: 4:29 p.m. EDT March 19, 2009Comments: 2NEW YORK (MarketWatch) -- Goldman Sachs said it would hold a conference call with reporters on Friday to, "answer questions from journalists, and clarify certain misperceptions in the press regarding Goldman Sachs' trading relationship with American International Group."
Members of the public can listen to the call via webcast, the company said in a press release.
http://www.marketwatch.com/news/story/goldman-detail-aig-trading-relationship/story.aspx?guid=%7B83E134BA%2DA983%2D451F%2DB6A7%2DFF4D005EEECF%7D&siteid=yhoof
energyecon Thu Mar 19 16:23:38 2009 CDT #
Lawyerliz says:
A floorplan loan can be any inventory--usually large sized big ticket items. In its classic form the washing machines or whatever are located in a sales area, and can't be moved off the premises without the lender knowing about it and getting a pay-off on the item. I'm sure there are lots of versions of this. The idea is inventory goes in and out and the lender stays protected on the loan for whatever's there.
Lawyerliz Thu Mar 19 16:25:03 2009 CDT #
petshop boys music made me a gay slut says:
expanding diagonal triangle, lookout below s&p 620
petshop boys music made me a gay slut Thu Mar 19 16:30:59 2009 CDT #
Comrade Byzantine_Ruins says:
A U.N. panel will next week recommend that the world ditch the dollar as its reserve currency in favor of a shared basket of currencies.
The Hour of Yogi is at hand!
Soon we'll all be speaking Cosmoranto and Africa will be a peaceful and blossoming Eden. Oh yeah, and the Israeli occupation of Palestine will end. They deplore that. And some other things too.
The reason people are leaving the dollar is that you would be an idiot not to. The idea of a basket currency of reserve and account is not exactly new -- does anyone out there still have any Ecu, maybe some they bought out of curiosity or good humor, and never negotiated their way out of?
Reserve currencies are a facet of hegemony and are about the facts as they stand in the autarky of the cultural ecumene. When a new order emerges, a new trade regime will emerge with it. I don't think we will see a smooth transition this time as between the GBP and the USD.
Comrade Byzantine_Ruins Thu Mar 19 16:34:02 2009 CDT #
Werner says:
...Fed Expands TALF to include more Securities...
I guess these idiots will now take my boat-loan too ?
Hihi, America !
Werner Thu Mar 19 16:35:09 2009 CDT #
cd says:
Kung Fu Panda-
cd,
That BW piece on China was very good. It's no surprise that orders aren't materializing, but the turnaround in Chinese companies' need to actually try to sell rather than just take orders emphasized the change. I think that chances of unrest will be high this summer when it will be obvious to all in China that American demand didn't come back and 2009 will be a complete disaster. It will be quite a turnaround from the triumphalist Olympic mood.
that was my take too..and now they might be taken advantage of via letters of credit etc...fictitious company in america orders 2 containers of furniture on credit and go bankrupt with the 300K of furniture in possession then sell at auction for 150K....easy money....
cd Thu Mar 19 16:40:31 2009 CDT #
FoamFinger1 says:
"Mortgage servicing advances are loans extended by residential mortgage servicers to cover payments missed by homeowners."
...so now the servicer barrows money (plus interest) to cover the growing gap in missed payments. The RMBS/bank no longer needs to; re-work, cram-down, foresclose, mark down the asset to a realistic market price or, try to sell it. The servicer just continues to barrow from the Fed to cover more missed payments on an over priced asset and the cycle continues...
With this system, a loan is kept "current" no matter how bad the situation! Heads they win. Tails they win.
...if the servicer has a set amount in reserve for some missed payments, fine. Why keep piling more debt on top of more debt to solve the underlying problem of too much debt?!?!
This floor the gov't is trying to put under housing prices and auto sales is the second level on a house of cards.
FoamFinger1 Thu Mar 19 16:41:19 2009 CDT #
Comrade Byzantine_Ruins says:
Werner says:
Today, 5:35:09 PM
I guess these idiots will now take my boat-loan too ?
They will take your dead parakeet as if it was alive, and at a market value as a prize parakeet that you assert. They used to insist on a good pedigree for their dead parakeets but now they will take any old bird.
Comrade Byzantine_Ruins Thu Mar 19 16:41:54 2009 CDT #
Comrade Byzantine_Ruins says:
FoamFinger1 says:
Today, 5:41:19 PM
...so now the servicer barrows money (plus interest) to cover the growing gap in missed payments. The RMBS/bank no longer needs to; re-work, cram-down, foresclose, mark down the asset to a realistic market price or, try to sell it. The servicer just continues to barrow from the Fed to cover more missed payments on an over priced asset and the cycle continues...
See how much more efficient tarponomics is than conventional economics? Soon tarponomics will supplant much of the so called "real" economy, at least for a little while!
Comrade Byzantine_Ruins Thu Mar 19 16:45:20 2009 CDT #
ghostfacedinvestah says:
Cash for trash.
ghostfacedinvestah Thu Mar 19 16:50:07 2009 CDT #
FoamFinger1 says:
If the fraud rate for 2008 home loans is showing up worse than bubble years, can you see how the current "Fix" will only grease the wheels for more BS real estate deals.
The Fed buying any and all ABS, RMBS, *BS will just keep the crooks in business.
FoamFinger1 Thu Mar 19 17:03:12 2009 CDT #
Anonymous says:
What did the inside traders learn yesterday?
CHICAGO (Reuters) - Option volume in Citigroup (C.N) on Wednesday skyrocketed, as the bank's calls became more popular than the S&P 500 SPDR SPY.P exchange-traded fund, typically a top favorite among the options crowd.
About 1.82 million calls, which give buying rights to Citigroup shares, traded, more than seven times the norm as investors who had bet the stock would fall were forced to reverse that trade when the shares soared nearly 23 percent....
How did they find out yesterday?
NEW YORK (Reuters) - Trading in shares of Citigroup Inc (C.N) was halted on Thursday pending news on the company, according to the Nasdaq Trader website.
Anonymous Thu Mar 19 17:15:59 2009 CDT #
brirssi says:
another ignore test
brirssi Fri Mar 20 01:18:04 2009 CDT #
blahg says:
this is a test of the blahg comment system
blahg Fri Mar 20 01:21:33 2009 CDT #
brirssi says:
another another ignore test
brirssi Fri Mar 20 01:27:41 2009 CDT #
brirssi says:
LAST TEST I HOPE
brirssi Fri Mar 20 01:29:51 2009 CDT #
fresno dan says:
I expect in 36 hours the assets accepted will be expanded to include comic books, baseball cards, beanie babys, cabbage patch kids, 8-track tape players, and those little Japanese tiddy wink like thingys. Additionally, they will be "no-doc."
fresno dan Fri Mar 20 05:11:27 2009 CDT #
JT says:
The Fed is the largest auto dealer and business equipment dealer in the country!
JT Fri Mar 20 07:55:46 2009 CDT #
END