Posts filed under “Credit”

Subprime Credit Rot

Rather than respond to the various cheerleaders and pollyannas (Ben Stein, Brian Wesbury, David Malpass, et. al.) who have been telling us how great things are even as recently as this week, I prefer to respond via some humor, culled from around the web.

First up: Long or Short Capital:

The Jitters
by Johnny Debacle

Guy #1: Subprime?
Guy #2:
Guy #1: Subprime.
Guy #2:
Guy #1: Exposure?
Subprime Jitters.
Guy #1:
Guy #2: No, CONTAGION.
But the expected loss on all residential subprime loans is de
to the greater economy.
Guy #2: Liquidity. And
Guy #1: Oh. Fuck.
Guy #2:
Commercial paper.
Guy #1: The end.

And I love  their tag line: "Let us think for you, since we’re better at it."


And, the always amusing Ben Sargent:


via Yahoo!

Category: Credit, Derivatives, Hedge Funds, Psychology

Quote of the day: Moral Hazard

Category: Credit, Derivatives, Psychology

Ratings Agencies 2007 = Equity Analysts 2000 ?

Category: Credit, Derivatives, Hedge Funds, Psychology, Real Estate

Open Thread: Closing the Barn Door on Sub-Prime ARM Mortgages

To be filed under "Better-Late-Than-Never" regulatory actions: The Federal Reserve is considering the following changes in Sub-Prime lending disclosures:

The federal financial regulatory agencies today issued proposed illustrations
of consumer information for certain adjustable-rate mortgage (ARM) products
described in the agencies’ Statement on Subprime Mortgage Lending (Subprime
Statement), effective July 10, 2007. The Subprime Statement recommends
communications that ensure consumers have clear, balanced, and timely
information about the relative benefits and risks of certain ARM products. The
illustrations are intended to assist institutions in providing this information.

(Below is a table of the proposed changes)

So is this a case of too-little-too-late, or might this actually accomplish something positive?

What say ye?


click for larger table


The rest of the proposed changes are after the jump . . .

Read More

Category: Credit, Derivatives, Federal Reserve, Psychology, Real Estate

Money Markets Substitute Halting Redemptions

Category: Credit, Markets, Psychology

Open Thread: Fed Intervention

Category: Credit, Derivatives, Federal Reserve

Fed Treads Moral Hazard

Category: Credit, Federal Reserve, Markets, Psychology

Helicopter Drop

Category: Credit, Currency, Federal Reserve, Psychology

Credit Crunch: Global Map

Category: Credit

Open Thread: Rescue Me!

Category: Credit, Currency, Derivatives, Federal Reserve, Markets, Psychology