Good read by RBS....watch them markets

[Surfer]

RBS issues global stock and credit crash alert - Telegraph (http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/06/18/cnrbs118.xml)

[Jimmie]

That's some scarey stuff. We all know somebody that lived through the last big depression.

[Surfer]

The U.S. is really royally screwed, I deal a lot in the capital markets and although all you hear on the news is the subprime mess thats only a sliver of the problems. Your going to see more banks and institutions fail this year and coming years, Wachovia for example is going to be in a world of hurt with their acquisition of Golden West which was about the dumbest thing they could have done, their sitting on a nuclear bomb about to go off. Too much greed in the U.S. I deal with some large firms directly and for example American Capital is having big issues with their syndications, and for a company of that size and considered by many to be the creme de la creme, that shows just how f'd we are. Majority of Venture and PE firms can't even raise capital and we deal with some of the top firms.

[nitro78]

You could see this coming at least 2 to 3 years ago dont you agree?

[Surfer]

You could see this coming at least 2 to 3 years ago dont you agree?Easily, I called it and others did years ago, but nope, none of our leaders or institutions seems to :rolleyes: . They were all for it when fattening their pockets with insane bonuses and salaries, and still are while everyone is being laid off and firms are collapsing or having assets seized.

[nitro78]

My fav is when a ceo gets fired but receives a multi-million dollar "compensation package" on his way out.

[Streetlife]

That's connections for you.

[supercharged]

Looks like America is facing another Great Depression...

[ScottB]

I doubt we will see an actual depression, but I do believe we need to call this what it is and its a severe recession. Consider it a revaluation of the world in which we live. There are certainly alot of issues that need resolving and each state also has some unique issues. In Florida the average service worker cannot afford to live here.

As for Wachovia, we will survive. My hope is that we dont get merged into another bank as before this subprime market started we were one of the strongest banks in the world and made huge profits. Golden West/World Savings was a bad move indeed, and a bad investment as that is exactly what it was. We felt we were missing a part of the pie as prior we concentrated on A based credit deals only. The nice part is the retail units (branches) are still making over a billion dollars quarterly in profits and this will help tremedously. Time will tell, and hopefully all my stock and options will rebound. I would not like to be a local small bank employee however, as Wamu, BankAtlantic and other community banks are for sale and need immediate buyers. These other banks have laid over a 1/3 of their workforce to date.

[gary26]

Just yesterday news cast said Wamu to layoff another 1,200 people in California banks alone.

[TS204891]

Umm.. as an econ student I have to disagree.. Unemployment is around 5% right now.. thats pretty good considering we were at 15% during the GD..and the 87 crash was even severer than the GD.. inflation was around 15%.. Technically we are not even in a recession yet..

Gas is expensive.. but its still available every time you go to the pump! There is no real fix for supply shifts.. use less.. or as most people do, compain that "someone" else needs to fix it or find a new technology. Also, gas has been much more expensive everywhere else in the world for a long time.. we were lucky to have it so cheap for so long.. but stupid for not realizing it and finding ways to use less. We procrastinate over everything!

[nrengle]

To add the to the gas thing. Even with everyone saying drill in Alaska, or lift the ban on offshore drilling, it won't change anything for a long time. It would take at least 5 to 10 years to see a difference. You have to get the infrastructure online. Face it, high gas prices are here to stay, and we need to stop our dependency on oil, and look at the alternatives.

One thing that I don't understand is. We can make a synthetic oil for lubrication that every car can use, but they can't make a synthetic gasoline that every car use? What's wrong with that picture.

I think it's time to ramp up development of the Fuel Cell and the Electric car. Or maybe the Mr. Fusion. Run our cars on garbage!

[Surfer]

Umm.. as an econ student I have to disagree.. Unemployment is around 5% right now.. thats pretty good considering we were at 15% during the GD..and the 87 crash was even severer than the GD.. inflation was around 15%.. Technically we are not even in a recession yet..

Gas is expensive.. but its still available every time you go to the pump! There is no real fix for supply shifts.. use less.. or as most people do, compain that "someone" else needs to fix it or find a new technology. Also, gas has been much more expensive everywhere else in the world for a long time.. we were lucky to have it so cheap for so long.. but stupid for not realizing it and finding ways to use less. We procrastinate over everything!Unemployment barely means anything, not when majority of employed are living beyond their means or barely getting by when salaries etc have stayed about the same and everything else has risen. I'm talking in the sense of the nation as a whole, I deal in the capital markets, the backbone of this country, our capital markets have become so severely flawed that this is completely different the other crashes and RE is only a part of it. Some people bring up the crash of the late 80's and early 90's, this is not the same thing, that was focused in S&L institutions, this time its widespread through almost all sectors. Also the gas thing, its actually about the same and cheaper in other countries, its their extra taxes added on that make it so expensive, not the actual acquisition of the gas itself. Never mind our refinery infrastructure is actually out of date and inefficient compared to even countries below us b/c all we do is band-aid fixes and expansions, have family in oil, a lot of these facilities are constantly fixing problems no matter what updates they do. I think one of the worst things though were the pos diesel we used to offer here in the 80's that put a nasty taste in everyones mouth, now so many people still think of diesel as slow pos noisy engines, when its the complete opposite. I've been wanting a diesel suv for so long for towing ability and power and mileage, only now in the next few years will we see so, but now diesel is about a buck more then premium when just a few years ago it was cheaper then regular. But thank all the hippies and their crap pushing for laws. New diesel are more efficient and cleaner then a lot of new gas engines, we should have started more diesel offerings here years and years ago. Only now, the U.S., as usual is late to the game.

Scott- I think two things will happen with Wachovia, merger/buyout, or BK. Purchase of Golden West and the fact that there are another 3-5 years of recasting to go on all the negative amortization loans that are kept in the portfolio is what will be the downfall, we haven't even seen the worst yet as the majority have been 2 year arms adjusting, still have 3yr/5yr/7yr and Neg Amm to go. I think they'll merge/buyout, I don't think BK. Wachovia already had an injection of 7B as did other banks, and this was just the beginning, whats going to happen when the real cluster f$%k happens with the portfolio?

WaMu - their done for, I'm willing to bet they will be BK this year or early next year. Their holding some of the worst debt ready to explode but don't have the infrastructure or flexibility I should say of other institutions. I have a friend who is a manager with them and their seeing more and more people pull their depositories away (personal and business).

Here was a good post on the Pirate Board (offroading).
Pirate4x4.Com Bulletin Board - View Single Post - Hey Israel... (http://www.pirate4x4.com/forum/showpost.php?p=8390321&postcount=8)

I agree, I don't think the U.S. will be the country it once was, we've pretty much started our downfall....happen to other countries, will happen again.

[Bunky]

The usual flaw in the doom and gloom financial types is that there will be no response to certain situations as if everything is set is stone. The middlemen in the financial world love chaos and and thrive on creating panic. Why? There is profit.

Yes, there is some corrections coming. How it gets done depends on the Fed and others. Any downfall can be recovered (relative to other countries) with the right fiscal responsibility. Yes, people that have inflated priced items (maybe even oil) could lose a substantial amount. I was hoping after the tech bubble busting that the SEC would get overhauled but sadly not. The economy has been growing strongly thanks to the running budget deficit.

[ScottB]

Scott- I think two things will happen with Wachovia, merger/buyout, or BK. Purchase of Golden West and the fact that there are another 3-5 years of recasting to go on all the negative amortization loans that are kept in the portfolio is what will be the downfall, we haven't even seen the worst yet as the majority have been 2 year arms adjusting, still have 3yr/5yr/7yr and Neg Amm to go. I think they'll merge/buyout, I don't think BK. Wachovia already had an injection of 7B as did other banks, and this was just the beginning, whats going to happen when the real cluster f$%k happens with the portfolio?


While a merger is possible (it wont easily be a buyout unless done by a foreign bank due to Wachovias size and multi hundred billion holdings) the bank is commited to redeveloping itself and very well can if it falls back to original lower risk profitability design. The days of high dollar risk based loans are done (heck we cannot even use electronic values as a basis any longer and max at 70% LTV currently at best).

As for bankruptcy, well I think thats highly overexaggerated and the only ones suggesting it have or want a big piece of the fallout. The FED would likely first come in and run the bank and decide solvency versus insolvency. The basis for profit (not growth) is there currently in fee's , overnight investing, and other well defined but much lower value profit. As you know the only risk based financing was a specific portfolio we inherited in the GoldenWest/Worldsavings merger.

Likely reducing the workforce is next and a real possibility but till now is extremely limited to overlap. Financial centers and real estate will be reduced from banks portfolio also to garner more funds. The industry suggests the 9 billion we recently liquidated with cover the additional losses from GoldenWest and the banking is hard at work to close/redine/refinance these deals as possible including long term fixed rate mortgages. Another words, there is alot going on outside the public eye to change this and quickly. It will take some time and theres obvious no absolute ...since I have alot invested personally with them (time too) I remain optimistic and suggest to some this might be a nice time to consider the investment to. At 16+ a share, and a long term investment approach this might make some people some good money and certainly a great value on a 60 stock only 14 months ago.