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Butterfly

changing your story again ?

bkkandrew

^I'll ask you again, which word were you stuck on?

Butterfly

you keep asking the same question, I already proved it with the links above where you made false claims, how many times do I have to repeast myself ?

well, he has some good points, but even if his sentiment was shared with the audience, they still had no solution. It's the same story, they see it coming, but they can't pre-empt the solution until it happens, the problem is too big to be pre-empted, it has to happen before meaningful actions can be taken.

bkkandrew

I am not asking you to repeast (sic) yourself, I am asking you which word you were stuck on in this quote:

When you said this:

bkkandrew

A reminder from an Icelander:

But Butterfly, 8000 miles away, thought this:

bkkandrew

Perhaps this is time again for a reminder of facts verses Butterflyworld...

The facts:

While in your world you thought this:


http://teakdoor.com/us-domestic-issu...tml#post794335 (A note of caution for those with deposits in US Banks)

bkkandrew

Does this mean you are finally coming round to my opinion that complete worldwide financial collapse is now inevitable?

Butterfly

^ there is a big difference between inevitable and possible, I think you are confusing those 2 terms

bkkandrew

^Nope, at the start of this thread I stated possible, now (and since July) I believe inevitable. The difference is 6-months. 6-months that saw no averting action.

Off out for the day, so you can ramble on on your own on the thread for a bit.

bkkandrew

Initial Summary of the day (another one tomorrow morning after I have had time to think):

Stock markets worldwide down between 5-10%, inc. FTSE down 9%. LIBOR still rising despite bailouts. Day of reckoning for Lehman CDO Insurers. G7 meeting. Iceland saying they are not bankrupt when clearly they are.

And then the wild DOW ride:



I have never seen a chart like this for one day's trading....

bkkandrew

I stated on William's 'Black Friday' thread that there are two possibilities to this madness:

The question is why? Not why on the above, but why we have reached this point? The name that keeps cropping up is Robert Peston. Today he has inferred option (1) in his blog (no link, just fucking look for it). Yet he is the 'father' of the credit crunch when he broke the story of BNP Paribas being unable to value its US mortgage-backed assets last year. There is a fine line between being 'ahead of the game' and being a mouthpeice for those that aim to change paradigms.

Anyway (disclaimer), too much wine on board, so proper analysis in the morning, assuming the hangover is cured.

bkkandrew

Back to Cars:


GM and Chrysler 'in merger talks'


Chrysler is the No3 maker in the United States, and GM the No1


US car giants General Motors and Chrysler are in talks about a possible merger, US media say.

Reports say the talks have been going on for a month but details of the deal vary from a merger to an acquisition by GM of Chrysler.
GM is the leading manufacturer and Chrysler third after Ford. All have been suffering with a plunge in US sales to 15-year lows.
Neither of the parties have made any direct official comment.

Ford move

Sources told the Wall Street Journal that Cerberus Capital Management, which owns 80.1% of Chrysler had proposed trading its automotive operations to GM in return for GM's stake in the auto lender GMAC Financial Services.

The New York Times's sources spoke of a merger that was a "50-50" possibility, although it could take weeks to finalise and had been stalled by the turmoil in the financial markets.

GM spokesman Tony Cervone said: "Without referencing this specific rumour, as we've often said, GM officials routinely discuss issues of mutual interest with other automakers."

Analysts have questioned Chrysler's position, given its reliance on North America for 90% of its revenue.

Both companies have been hard hit by falling truck and SUV sales and are struggling to push through job cuts against union opposition.

GM shares hit a 60-year low this week. It posted a second-quarter net loss of $15.5bn. Separately, Reuters reports that Ford is planning to sell most of its 33.4% holding in Japan's Mazda.


BBC NEWS | Business | GM and Chrysler 'in merger talks'

What do you get when marrying two bankrupt companies merge?
a) A big bankrupt company.
b) Economies of scale for the insolvency practitioner.

bkkandrew

Now having read the G7 5-point plan in full, I can exclusively reveal the contents:

1. We
2. Don't
3. Have
4. A
5. Plan

bkkandrew

Tom Bawden in New York and Suzy Jagger in Washington

Lehman Brothers, the bust investment bank, triggered one of the biggest corporate debt defaults in history yesterday as it emerged that the US Federal Reserve is harbouring grave concerns about whether Washington’s $700 billion (£413 billion) bailout fund will avert a financial meltdown.

An auction of Lehman’s bonds yesterday determined that the bank’s borrowings were worth only 8.625 cents on the dollar. The valuation leaves the insurers of the debt a bill of about $365 billion. It is not clear whether the insurers, which are required to settle the bill in the next two weeks, will be able to pay – a development that could further undermine increasingly stressed capital markets.

The $365 billion default came as stock markets around the world suffered one of their worst days since the crash of 11 years ago. Panicking about the prospect of global recession, the FTSE 100 index of leading shares in London crashed within seconds of opening, losing 8.9 per cent of its value, its worse fall since October 1987.

The index recovered to close down 225 points, marking a 5 per cent decline, but more than a fifth was wiped off London shares this week alone. Issues in New York fluctuated wildly as the Dow Jones industrial average slumped by 312.14 points at lunchtime before closing at 8,451.19, down 128.00. Both markets had been scared by losses in Tokyo, where the Nikkei lost 10 per cent of its value.

Amid the mayhem across the world’s stock markets, senior Fed officials now doubt whether Washington’s bailout fund will work unless it is launched in some form in the next two weeks.

The Times has learnt that central bankers in America are anxious that if the Treasury is not able to accelerate the speed at which it launches its rescue scheme, it will have no effect. At the moment, the Treasury, which controls the fund, is working to a five-week schedule to get the rescue package up and running. Under present plans, the bailout fund is not expected to buy its first distressed mortgage-backed bonds until after the US elections on November 4.

It is understood that the Fed believes that this will be too late to help the banks that are suffocating under market conditions. Credit markets have frozen up and many banks have been cut off from being able to borrow from one another.

Mr Paulson’s bailout fund is designed to buy up distressed bonds held by troubled banks. This week the former chairman of Goldman Sachs appointed Neel Kashkari, one of his protégés at the Wall Street bank, to run the fund. Mr Kashkari had already been working closely with Mr Paulson during the negotiations over the passage of the “troubled asset relief programme” on Capitol Hill.

Mr Paulson is also considering a range of other forms of financial assistance, which include the Treasury using taxpayer funds to buy stakes in Wall Street banks. Under such a plan, the cash received in return for the shareholding would provide much-needed capital for the banks.

Lehman’s corporate debt default promises to increase the stress across global credit markets. Sean Egan, of the Egan-Jones ratings agency, said: “This is a killer. Lehman said a month ago that it was in terrific shape and now you can’t even get ten cents on the dollar for its debt.

“It underscores the deep structural flaws in our financial system, knocks confidence in the financial markets and raises the cost of capital. It also demonstrates that we are experiencing not only a crisis of confidence, but a crisis.”

About 350 banks and investors are thought to have insured an estimated $400 billion of Lehman’s debt through complex derivatives, known as credit default swaps. These include Pacific Investment Management, the manager of the world’s largest bond fund, Citadel, the US hedge fund, and American International Group, the insurer that the US Government recently bailed out with two loans totalling about $123 billion.

The Times has learnt that the US Treasury has been overwhelmed with requests from executives of other beleaguered sectors who are seeking a similar bailout scheme for themselves. It is thought that representatives from the US car and airline industries have approached the Government for assistance. It is understood that Mr Paulson does not believe that it is his job to help them. Rather, he is intent on addressing the root problems of the financial crisis.

From:

Lehman Brothers demise triggers huge default - Times Online

My bold/highlighting.

This underscores the point. $365BN to be found when the Paulson plan only allows $250BN now, $100BN on request, with $350BN only available after further approval from Congress (currently involved in an election)....

The numbers are completely at odds with each other. The latest nonsense from the G7 is posturing and meaningless. It will be seen as such. The queue for bailouts now is a long line indeed.

It is clear that, after my flight to Bangkok on Monday, I will devote substatially more time to the 'US Martial Law' thread...

DrAndy

Nobody has mentioned anything about Canada, or the RBC

surely they are badly affected too?

bkkandrew

...And another 20% off stock markets this week.

IMF warns of meltdown
Reuters
By Lesley Wroughton and James Mackenzie Reuters - Sunday, October 12 04:34 am

WASHINGTON (Reuters) - The IMF warned the world's financial system was near meltdown and France promised that a meeting of European leaders in Paris will detail measures to keep a market panic from triggering the most severe global downturn in decades.

Continued at:

IMF warns of meltdown - Yahoo! News UK

bkkandrew

^Canada has actually got one of the stronger banking sectors, which is why it has been off the radar. The Royal Bank of Canada is not a bank I have seen any adverse reports of, but then again, I haven't been looking.

It will, however, be crippled once the complete collapse happens as all its counterparties will collapse and default.

Spin

Bloombergs Dow chart for friday intraday is shite not sure why is doesnt show what actaully happened at the open.



They seem to have 200 points "missing" from the plunge that occurred at the open.

A better representation of what actually happened is here, clearly the selling reversed at 7900 and not 8100.



Perhaps Bloomberg are trying to smooth over whats actually going on out there?

(please ignore the +481 number in blue, that figure represents the futures for monday13 ths opening)

bkkandrew

^Re above. Video posted here:

javascript:bringupPlayer(%22vid=vcYqArJFMJgA%22,%2 2av%22,encodeURIComponent(%22Roubini Sees Crisis Worsening, Hurting Emerging Markets%22))

Edit: Er, haven't quite got the video thing worked out, anyway, its on Bloomberg...

Here:

Bloomberg News Video

bkkandrew

Emmanuel Roman, of GLG Partners, said 25pc-30pc of the world's 8,000 hedge funds would disappear "in a Darwinian process", either going bust or deciding meagre profits are not worth their efforts.

"This will go down in the history books as one of the greatest fiascos of banking in 100 years," said Mr Roman, who co-runs London and New York-based GLG, a former division of Lehman Brothers Holdings with assets of $24bn (£14.8bn). "There need to be some scapegoats, and the regulators are going to go hunt people. That will be good in the long run."


More at:

Thousands of hedge funds to close, says GLG chief Emmanuel Roman - Telegraph

And to think the biggest crisis of the last 10-years before the credit crunch was one Hedge Fund (LTCM) going belly-up. Now we face 2400 of them meeting this fate!