Posts Tagged ‘commercial real estate losses’

MUST READ: A TWO PART CREDIT CRISIS

Here’s a must read, courtesy of The Pragmatic Capitalist

MUST READ: A TWO PART CREDIT CRISIS

The latest McKinsey Quarterly is a gem of a research report that details many of the issues I have been banging the drum on for months now. They say this crisis is made up of two parts: a securities market credit crisis and a commercial credit crisis. The first of these crises is likely ending as we speak, but the second portion is only just getting started.  Regular readers are familiar with my constant ramblings (and thus far accurate calls) on the banks and the impending credit card losses, ARM resets and commercial real estate losses.  These are the issues that McKinsey is referring to when they speak of this “second part” of the credit crisis:

The good news is that we have probably turned a corner in the credit securities crisis that last fall forced big financial institutions into collapse, nationalization, or extreme survival tactics. But the contours of a broader resolution of the crisis will remain fuzzy for some time to come. That’s because what many have been regarding as a single credit crisis is in reality the tale of two closely related but different crises, each with its own pace, duration, and demands on banks to rediscover operational discipline in a harsh economic and regulatory environment.

The first credit crisis was centered in the securities markets and initially manifested itself in the subprime and mortgage-backed securities markets. Because of the fair-value accounting that broker–dealers and investment companies use to mark assets to current market expectations, these firms began to suffer deep losses on mortgage-backed securities long before large volumes of loans started to default. This credit crisis started in mid-2007 and peaked in 2008, resulting in the demise of Bear Stearns, Lehman Brothers, and Merrill Lynch, and forcing Morgan Stanley and Goldman Sachs to become bank holding companies in order to survive. It also heaped huge losses on the securities arms of major US banks and forced government takeovers or mergers on AIG, Fannie Mae, Freddie Mac, National City, Wachovia, Washington Mutual, and others.

The good news is that we appear to be seeing the end of this credit securities crisis. That is in part due to the clarity provided by the stress test exercise and the ongoing commitment on the part


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Phil's Favorites

The COVID-19 virus can spread through the air - here's what it'll take to detect the airborne particles

 

The COVID-19 virus can spread through the air – here's what it'll take to detect the airborne particles

Researchers are working on handheld devices that can signal the presence of SARS-CoV-2 in the air. fotograzia/Moment via Getty Images

Courtesy of Suresh Dhaniyala, Clarkson University; Hema Priyamvada Ravindran, Clarkson University, and ...



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Biotech/COVID-19

The COVID-19 virus can spread through the air - here's what it'll take to detect the airborne particles

 

The COVID-19 virus can spread through the air – here's what it'll take to detect the airborne particles

Researchers are working on handheld devices that can signal the presence of SARS-CoV-2 in the air. fotograzia/Moment via Getty Images

Courtesy of Suresh Dhaniyala, Clarkson University; Hema Priyamvada Ravindran, Clarkson University, and ...



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ValueWalk

Trump holding up coronavirus stimulus checks to block mail-in voting?

By Aman Jain. Originally published at ValueWalk.

It is now clear that there won’t be any coronavirus relief package this week or possibly this month as well. The reason for the collapse of talks is known to be the difference over several provisions, as well as the size of the package. However, it is possible that President Donald Trump is blocking the deal and the coronavirus stimulus checks because of mail-in voting.

Q2 2020 hedge fund letters, conferences and more

No coronavirus stimulus checks due to mail-in voting?

Speaking to Fox Business on Thursday, Trump suggested that he is holding up the ...



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Zero Hedge

Britain's 'A-Level' Results Crisis & The COVID-Education Train-Wreck

Courtesy of Yves Smith's NakedCapitalism.com

Many of you in the US likely missed the A level testing algo fiasco. Here is the short version, from the Financial Times yesterday:

The government is under mounting pressure to come to the aid of secondary school pupils in England after almost 40 per cent of A-level grades were downgraded from teachers’ predictions.

Amid an angry backlash from pupils and teachers, opposition parties and trade unions led calls for ministers to review how A-level results were modifi...



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Kimble Charting Solutions

Silver Could Be Creating Large Reversal Pattern, Says Joe Friday

Courtesy of Chris Kimble

Could Silver prices from 30-years ago be influencing price action this month? Joe Friday suggests it is possible.

This chart looks at Silver Futures on a monthly basis over the past 40-years. Fibonacci levels were applied to the 1980 highs ($50) and 1991 lows ($.350) in Silver.

The 50% retracement levels of the 1980 high/1991 low came into play as support for a few months at each (1). Once this support broke, Silver fell another 50%.

The impressive rally over the past 8-weeks has Silver testing the 50% retracement level as potential...



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The Technical Traders

Adaptive Fibonacci Price Modeling System Suggests Market Peak May Be Near

Courtesy of Technical Traders

Our Adaptive Fibonacci Price Modeling system is suggesting a moderate price peak may be already setting up in the NASDAQ while the Dow Jones, S&P500, and Transportation Index continue to rally beyond the projected Fibonacci Price Expansion Levels.  This indicates that capital may be shifting away from the already lofty Technology sector and into Basic Materials, Financials, Energy, Consumer Staples, Utilities, as well as other sectors.

This type of a structural market shift indicates a move away from speculation and towards Blue Chip returns. It suggests traders and investors are expecting the US consumer to come back strong (or at least hold up the market at...



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Chart School

Silver Big Channel

Courtesy of Read the Ticker

Big channels are the sand pit of price action. Lets review some big trends of these past months.


GLD
- Moving higher to upper solid red line channel


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XAU
- Ready to pause, or simply explode.



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SILVER
- Ready to pause, or simply explode.


Click for popup. Clear your browser cache if image i...



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Digital Currencies

Raoul Pal: "It May Not Be Worth Owning Any Asset Other Than Bitcoin"

Courtesy of ZeroHedge View original post here.

Authored by Turner Wright via CoinTelegraph.com,

Raoul Pal, CEO and founder of Real Vision, says Bitcoin may soon become his only asset for long-term investments.

image courtesy of CoinTelegraph ...



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Lee's Free Thinking

Texas, Florida, Arizona, Georgia - The Branch COVIDIANS Are Still Burning Down the House

 

Texas, Florida, Arizona, Georgia – The Branch COVIDIANS Are Still Burning Down the House

Courtesy of Lee Adler, WallStreetExaminer 

The numbers of new cases in some of the hardest hit COVID19 states have started to plateau, or even decline, over the past few days. A few pundits have noted it and concluded that it was a hopeful sign. 

Is it real or is something else going on? Like a restriction in the numbers of tests, or simply the inability to test enough, or are some people simply giving up on getting tested? Because as we all know from our dear leader, the less testing, the less...



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Members' Corner

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

 

Coronavirus, 'Plandemic' and the seven traits of conspiratorial thinking

No matter the details of the plot, conspiracy theories follow common patterns of thought. Ranta Images/iStock/Getty Images Plus

Courtesy of John Cook, George Mason University; Sander van der Linden, University of Cambridge; Stephan Lewandowsky...



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Insider Scoop

Economic Data Scheduled For Friday

Courtesy of Benzinga

  • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
  • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
  • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
  • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
...

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Promotions

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Mapping The Market

How IPOs Are Priced

Via Jean Luc 

Funny but probably true:

...

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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