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| User Info | Banks: Here Come The OptionARM Blowups! in forum [Ticker] | |||||
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Genesis Posts: 66463 Incept: 2007-06-26 
Royal Flush! 
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http://market-ticker.org/archives/1206-B....
---------- I used to play flute; I wonder if I can play a fife? I incite prosecutors to create "Bubba Sausage Parking Lot" projects Darrell Issa has a middle finger and knows how to use it - Me 2009-07-12 11:54:39
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Sushihorn Posts: 5632 Incept: 2007-10-22
Arlington, TX
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Karl Well done. Those things should be called "Pick a Poison" mortgages. ---------- http://jengafinance.blogspot.com/ You can't fix stupid ... but you can kill it. 2009-07-12 12:12:27
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Genesis Posts: 66463 Incept: 2007-06-26
Royal Flush!
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"Arsenic or Polonium today, Mr. Jones?"
---------- I used to play flute; I wonder if I can play a fife? I incite prosecutors to create "Bubba Sausage Parking Lot" projects Darrell Issa has a middle finger and knows how to use it - Me 2009-07-12 12:14:19
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Mikeit83 Posts: 236 Incept: 2009-06-19 East Coast
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Karl- Great ticker. So- My question is does this coincide with the July 19-20th (later part of July) meltdown that has been prognosticated or briefly hinted at by you and others on this board? Im trying to map this all out in my head. And when does the commercial real estate bubble official topple. Very Interesting times we live in. -mike 2009-07-12 12:17:53
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Lucky Posts: 345 Incept: 2009-02-07
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A frapping lemonade stand, and with Decorum, at that. Low or no-documentation (stated income) loans were 81% of total originations. To quote another TF'er from another thread: "2007. The shooting was over by 2007. Don't kid yourself. The real dope went down years before, in the distraction period." There's the numbers. ALL. DOWN. ---------- Now it appears the 'goal' is no longer to defeat communism. The goal now appears to rabidly loot, and has entered a new desperate phase where the utilization of slave labor for mercantilist gain has extended to bankruptcy for profit, and the stealing of the meager savings of the slaves themselves. 2009-07-12 12:25:01
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Jlk Posts: 626 Incept: 2009-05-24 
Philadelphia
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Any intelligent observer should have known this was coming years ago, including Fed and Treasury officials. Why was the bubble permitted to grow to the extent that it did? There must have been a hidden agenda that was served by this.
2009-07-12 12:26:58
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Ghostcrab Posts: 86 Incept: 2009-04-17 Dallas/FtWorth Banned
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SHUT THEM ALL DOWN. Great Ticker! I very much agree, and I've been echoing a similar line of thought for some time. Who's going to do it though? You're not anticipating that the bank employees in DC are going to do that are you? ---------- "History records that the money changers have used every form of abuse, intrigue, deceit, and violent means possible to maintain their control over governments by controlling the money and its issuance." - James Madison 2009-07-12 12:28:17
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Wontbackdown Posts: 2076 Incept: 2007-09-20
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According to the Options Arm Resets Chart from Business Week, these dont Peak til Sept 2011 and then start declining. Seriously how high will unemployment hit before this is reached.. We truly are so ****ed.! 2009-07-12 12:28:44
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Einzel-kämpfer Posts: 6 Incept: 2009-03-14
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Whitney Tilson on 60 Minutes, December 14, 2008 Where's the Bottom? http://www.cbsnews.com/video/watch/?id=4.... 2009-07-12 12:34:18
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Nyflora Posts: 91 Incept: 2008-02-25 nation's capital
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Genesis, great ticker. We keep in touch with mortgage broker in NYC (does about 60% of brownstone mortgages in manhattan and brooklyn, mostly jumbos) who has been vocal in his belief that prime mortgages will be the real problem. He is getting louder and more animated than ever in talking about this problem, especially about JPM. You have hit the head of the nail.
2009-07-12 12:34:27
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Jlk Posts: 626 Incept: 2009-05-24
Philadelphia
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"KD" wrote..Approximately 40% of purchases in 2006 involved second mortgages taken at the same time as the purchase. This is important because these "piggybacks" are how you get around loan-to-value restrictions! While the industry has tried to say that this is primarily a subprime thing, THAT IS A LIE - 55% of ALT-As had piggypacks in 2006! Now that is really outrageous. 2009-07-12 12:37:58
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Beango Posts: 200 Incept: 2009-06-05
Online
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Whats to stop these banks from issuing extended moratoriums, thus kicking the can further and further?
---------- Welcome, to Entitlement Island 2009-07-12 14:21:34
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Lemonaid Posts: 3512 Incept: 2008-01-20 
Detroit Metro
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Cash flow or TNX
---------- "There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as the result of a voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved." Ludwig von Mises 2009-07-12 14:29:09
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Iou Posts: 116 Incept: 2009-03-16
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The idiots in power think they can still fix things. Nothing will be done until the system collapses.
---------- "When plunder becomes a way of life for a group of men living together in society, they create for themselves, in the course of time, a legal system that authorizes it and a moral code that glorifies it." - Frédéric Bastiat LEFT vs. RIGHT Look up shell game and shills. WAKE THE **** UP! 2009-07-12 15:12:03
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Schill Posts: 134 Incept: 2009-03-19
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What do you think the chances of survival are for Wells Fargo?
2009-07-12 16:56:37
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49norte Posts: 92 Incept: 2009-02-22
Somewhere over the rainbow Online
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Quote:The idiots in power think they can still fix things. Nothing will be done until the system collapses. Stop feeding the pig and it will die faster... ---------- Punishing people who succeed and rewarding people who fail can only lead to destruction. How far will we have to go before we wake up to that reality? 2009-07-12 17:17:10
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Jstanley01 Posts: 2332 Incept: 2008-07-30
San Antonio, Texas
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---------- Come on. It's just a ****ing casino. The markets have nothing to do with reality most of the times.. until they suddenly do... -- Peezdets 2009-07-12 17:42:06
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Blankfiend Posts: 1447 Incept: 2009-02-07
MA
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Here is a revealing graph or two from a presentation by T2 Capital on Zero Hedge.
---------- Sun Tzu: “Strike when victory is assured”. The events for which this period of American history will be most remembered have yet to occur. Last modified:
2009-07-12 17:52:17 by blankfiend
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Happymob Posts: 1692 Incept: 2007-08-03
West Virginia
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We've mocked homebuyers who defaulted on loans of far greater value (due to multiple refis with cashouts and helocs) than the original loans that the owner took out on the home 15 to 20 years earlier. $80,000 homes (at purchase) where the homeowner suddenly finds themselves with a $160,000 loss when they could have had the thing almost paid off by now. We're about to see the first instances of banks posting losses on a loan that exceed the original amount of the loan. Consider a Negative Amortization pay option loan made out in Victorville, CA (or maybe Palmcaster). The loan was originally 100% LTV, of course. Now, after 5 years of making minimum payments, the loan amount has climbed to 115% of original value. Of course, that extra 15% of negative amortization - well, the bank has been booking that as income the entire time, even though they haven't seen a cent of that money. Take an 80% haircut from the purchase price (not unrealistic right now in a few selected areas in California) on the home when you do foreclose on it and sell it and the bank is suddenly looking at a 95% loss on the loan (since they now have to back out that phantom extra 15% they've previously booked as income). Add in fees associated with foreclosure and they will have to book a loss greater than the original loan value. Of course, the bank will drag their feet, not foreclose, do whatever they can to not recognize the loss, but if anyone ever forces them to recognize the loss, it will be staggering. ---------- Anything from Missouri has a taint about it. 2009-07-12 18:22:29
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Rbarreira Posts: 892 Incept: 2009-05-27 Sweden
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Jstanley that cracked me up :) I used it in another forum, I hope you don't mind.
2009-07-12 18:25:53
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Mortgageguymn Posts: 140 Incept: 2009-03-09 North Coast
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Wells 2nd mortgage portfolio was ~ $130 bil a year ago. How much of that was in CA? That should be a total write-off, in addition to any Option ARMs from Wachovia.
---------- "Neither a borrower nor a lender be." - Harold Hecuba 2009-07-12 20:26:34
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Themortgagedude Posts: 3343 Incept: 2007-12-17
saint louis
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I know someone BK four months out of BK actually. He tells me his house went back to lenders in BK. That house is still titled in his name. Seems they are in no hurry. I told him to put another tenant in.
---------- Since September it's just gotten colder and colder. There's less daylight now, I've noticed too. This can only mean one thing - the sun is going out. In a few more months the Earth will be a dark and lifeless ball of ice. 2009-07-12 20:41:14
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Aquabava Posts: 14 Incept: 2009-01-26
Sunnyvale, CA
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Can someone tell me how capitalizing interest works from the Option ARM and why is it Phantom earnings...please give it to me in layman terms. I did a Google search, and all of them are accounting lingo...
---------- Everything you HAVE will deflate Anything you NEED will inflate 2009-07-12 20:42:32
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Memememe Posts: 89 Incept: 2009-06-21 Southern California
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49norte wrote..Stop feeding the pig and it will die faster... Too bad we can't fatten it up to our liking & make some tasty bacon instead. 2009-07-12 20:58:07
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Deejunk Posts: 389 Incept: 2008-10-11 Now DC - Solar Power.
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Aquabava - Instead of the home owner paying the full amount of interest on a loan as they go, the bank simply adds much of the interest back to the loan's principle balance so the homeowner can pay it later. (NOT!) If the home owner never pays the loan, the bank never gets the cash... But they are recording the income for this interest as they go along, claiming it as income when there is likely substantial doubt as to whether it would actually be collected... Not real income by any means. ---------- If the egg won't hatch... Fry it! Ready for serious inflation, deflation & collapse of the US & Global economic & market systems?  http://www.youtube.com/watch?v=fm4iU0yx9....Last modified:
2009-07-12 21:05:03 by deejunk
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