Nationalize the DAMN banks, place the banksters into protective custody at Gitmo and use the banksters private wealth to pay for their vacation from the business world.

The losses will easily top $4 trillion in the U.S. alone on home mortgages.

The IMF also said it now expects the deterioration in U.S.-originated assets to reach $2.7 trillion, substantially more than the $2.2. trillion it forecast in January. The sharp increase reflects losses mainly between October and January.

There's that pesky second derivative again. It's a good thing the IMF is worthless or else this might be cause for concern. It is also likely they are "talking their book" and will use this to justify their direct involvement in the $100b diminution of US wealth that quietly slipped through yesterday.

Borocco, I've been told by the local conservative radio host that the subject matter is "too hard" and that even he doesn't understand the problem with derivatives...So, I suppose that leaves the answer as "it is easier to babble mindless talking points"...

Anonymous,
You should keep an eye on the UDN. It only needs to clear 26 for a breakout.

Who cares..... going up now!

One hobo,

I look forward to composting tips using failed contestants from 'The Running Man, Wall Street Edition".

mark,
just a bump off of the 20 dema - won't last.

Imagine how difficult it will be to extract more public funds for banks from Congress right now... That well has been irretrievably poisoned.

Comrade Kristina (member) wrote on Tue, 04/21/2009 - 9:38am.

Borocco, I've been told by the local conservative radio host that the subject matter is "too hard" and that even he doesn't understand the problem with derivatives.

Well then the answer is obvious.: blame liberals, beaners and jigs. Demand more police powers. Brand anyone who disagrees with you a "socialist". Never question the fact that the "small state" you are demanding is incompatible with your obsession with hiring policemen whose retirements you can't afford.

Let's not look back at the sins of the past. Isn't that the new approach to legal and ethical responsibility? Sure, the bankers waterboarded the investors five times a day for at least the last five years, but let's move on. The abused bodies and mental scars of those who trusted them to be responsible are just a cost of freedom and were fully appropriate to the important tasks they performed. They were just following orders and using their unique skills to gain the benefits of free markets.. And we need them at their desks to show us the way forward - we can't do without their expertise. Forget the spilt milk. If we raise their salaries and bonuses, they'll work even harder to make this country great.

Byzatine_Ruins +1

Arbitrage Macht Frei wrote on Tue, 04/21/2009 - 9:54am.
How many dollars Americano does one need presently to be a legitimate Zimbabwe Trillionaire?

$1 US = approx $37.5 million Zimbawean--you do the math ...

Precisely because these losses are global, cds'd, 4 Trillion is way too low.

All counter-parties need to meet in the same soccer stadium, and decide which limbs they will all collectively do without in order to stabalize the system, otherwise, losses will be shocking, just shocking.

No, $7-$9 trillion in asset valuation is evaporating because of this nonsense. - Rob Dawg, Tuesday, June 13, 2006

Congressional oversight hearing with Geithner and Elizabeth Warren just started.

Code Pink is well-represented in the audience.

CNBC is calling for a retest of the March lows.

That's pretty much a lock for DOW 14,000 from here.

Here is Timmeh live on CSPAN ... http://www.cspan.org/Watch/C-SPAN_wm.aspx

popeye (member) wrote on Tue, 04/21/2009 - 10:01am.
1 USD = 281.2525 ZWD

Thanks for the update. I guess they devalued since I last checked.

REUTERS: The Treasury still has about $134.6 billion available in its coffers from last fall's bank bailout package and that should be enough for it to avoid asking Congress for more money, Treasury Secretary Timothy Geithner said....

Somebody's lying ....

Samdog --

Zimbabwe knocked 12 zeroes off of their currency three months ago.

I said it before and I'll say it again:

Spx rallied from 666 to 875

yesterday's close: 832

827 = 20 dma
809 = unfilled gap
790 = 50 dma and 38% retracement
770 = 50% Fib retracement

Base hits win ball games.

Anonymous wrote on Tue, 04/21/2009 - 10:08am.
Interesting teevee blackout this a.m. for a "scheduled test" of the emergency broadcast system. All channels were showing the same slide about the test. Shows you how easy it would be for them to "turn off" the system, intertubes included. Use the comments section while you can.

How to go from business as usual to millions dying by the fastest possible route.

One hobo wrote on Tue, 04/21/2009 - 10:10am.
"One hobo, So you can pick up WiFi in the freightyards?"

Those owners of unprotected wifis should be tested for STDs too. I'd bet there would a strong positive correlation...

OT again: one of my wife's uncles went wacko and started threatening people. They took him to the VA hospital for tests and he tested positive for syphilus ... probably late stage.

Boy, Timmeh has a look on his face like "Who the f*k advised me to come in here without a lawyer?"

Sununu is turning up the heat.

Sununu ... and next speaker ... asking for real specifics, particularly as they relate to how success or failure of each of the Treasury acryonyms will be measured.

It will be interesting to watch Timmeh try to generalize and obfuscate, and see how the panel reacts to that.

In 2006, the US banking industry made about $150 billion in profits (FDIC insured banks). Obviously some of that figure was fake earnings, and loss provisions were way too low. However, even at $150 billion per year, it would take 10+ years for the banking industry to get out of the hole it dug.

Never question the fact that the "small state" you are demanding is incompatible with your obsession with hiring policemen whose retirements you can't afford.

BS red herring.

A "small state" is perfectly compatible with a proper amount of policemen with *reasonable* benefits.

A number of posters seem to be including all real estate related losses as the bank's problem. That's not the case. Even without a bailout, there is a lot of mortgage insurance. While many loans didn't have downpayments, most loans did. Of course, securitization moved an awful lot of this risk to MBS holders. Banks have some CDS as well.

Here is the problem. As real estate prices drop further, the portion of each new dollar of loss going to the bank gets larger. When LA home prices dropped by 10% from peak, most of any loss went to the homeowner or a mortgage insurer. As prices drop from 40% off peak to 50%, much much more of that loss is going to the bank or MBS holder.

@ KM4

Good points.....and...Is Steinbeck still read in schools?

Every half-decade, America seems to lose more institutional memory and societal knowledge. For example, the current shape-shifting Debt and Debt Unwind crisis will soon enter Year 4, upon the anniversary of the late summer 2006 MSM news accounts of rising" 'sub-prime residential foreclosures' in Detroit and other aging rust belt cities".

Already it seems that under Team Obama's 'best-n-brightest' we're forgetting lessons and insights even from 2006, as Team Obama exhorts banks to pile more debt onto American households in the guise of 'credit' that is the 'lifeblood' of America and whose 'issuance' by TARPed banks is a sign we're 'nearing a recovery', and that such fresh new debt is 'good debt' because it is 'creating homeownership and auto ownership' opportunities for good, solid American families...whose consumption-fueled indebtedness remains at an unprecedent high of 370% of GDP, a level that only feeds more Debt Unwind.

Same old tune, just a new remix.

@ some investor guy

Your points are well taken. However a number of factors are fueling Debt Unwind and increasing the real losses to banks as the Debt Unwind shape-shifts.
As American Express and Capital One reported, banks are seeing rising defaults and write-offs in all 8 major categories of consumer credit.

In addition, within comm real estate CRE, there was a stupid move in 2003 away from guarantees by condo and gated community developer/borrowers. The CRE losses are mounting and the potential $s involve are huge.

Both of the above are fueled by not just job losses, but also wage cuts and furloughs by those still technically classified as full-time employed. Add on the actual job losses and the loss in household incomes from the above. This reduces spending which jacks up many of the component of CRE losses (strip malls, malls, and hotels/motels; + apts due to rent arrears and vacancies spurred by joblessness by renters).

The above reduces tax bases, reducing local govt revenues and that increases public sector furloughs and job cuts and reduces more household spending and reduces the # of HHs able to make their mortgage & rent pmts, and thus the spiral of bank losses continues towards $4.1 Trillion globally...and Beyond!

This can't be 'spun' away via optimistic talk & 'confidence'.

The IMF has it phrased wrong. It should read: illusory past gains of 4 trillion admitted.

Any real losses are happening only now, as the shock waves from the financial implosion hit the real economies of the world.

Stephen Hawking was very ill recently(Better now). I would think he became ill crunching these figures and realized that there was no solution!!!!!!!!!!!!

Outlier, good observation.
I think our financial salvations will be built upon a foundation of what we do individually and collectively on our blocks, in our local schools and community colleges, in our towns & cities, and then in our states. A tops-down, nation-wide solution from the Feds is a comforting thought, esp. for impatient aging boomers looking at shrunken 101Ks and 201Ks, and 'financial-albatrosses-as-houses', because they hoped it could solve problems quickly, in time for promised golden retirements from the marketers of wishes.

The bottoms-up solution seems less corruptible, more controllable, and will be far far slower.

@ crazy,

You are getting everything and missing nothing.

We live in a nation that refuses to say - and despises to hear - that IF these levels of debt are untenable and if Greenspan & Co. were indeed reckless, THEN almost all increases in economic activity since the Fed's i-rate drops of 2001 would never have occurred.
None of the job growth would have occurred.
None of the hi-rises built or box-stores opened.
Equally, the Toyota Prius record sales would not have occurred because the home-as-ATM would not have existed.
Those over-priced LEED-certified facilities would have never been financed and opened.

Even adjusting for population growth is not so pretty because had there been no US construction boom, there'd not have been that run-up in immigration; no IPO and start-up booms equals no HB visa booms.

You see, we in America covet simplistic narratives of Good-Bad, but what we have is an untenable reckless boom that bought us both Good and Bad. NPR, for example, really struggles, as a news source, in grappling with facts that dissipate simplistic good-evil media narratives. Blogdom does better.

Some argue that Greenspan could have modulated credit growth with the surgical precision of a much-ballyhooed Persian Gulf War era 'Smart Bomb". We've learned those bombs were not so smart. Likewise, the London Financial Times' Gillian Tett gave a great debunking in 2008 to the cherished "Myth of the Goldilocks Credit Boom" that is neither too small nor too large but 'Just Right' to sustain growth and avoid bubbles.