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Christmas message from Grinch-span


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#1 greenie

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Posted 20 December 2006 - 01:49 PM

Grinch is coming for US homeowners this xmas. Grinchspan made sure of that long before he retired happy.

http://thehousingbubble2.blogspot.com
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It's the illiquidity, stupid !

#2 jawndissedi

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Posted 20 December 2006 - 02:10 PM

It not's just housing, Greenie. Today's WSJ has an important article about the problems HSBC is experiencing with its U.S. credit portfolio.

"HSBC Sours on American Loans ": Consumer-Lending Portfolio Creates Indigestion Four Years After Swallowing Household Unit

HSBC Holdings PLC is learning that the U.S. lending business may not be so easy.

The London bank is facing rising problems with its U.S. consumer-loans portfolio nearly four years after its acquisition of Household International Inc., a U.S. lender that specialized in subprime loans, or loans to people with spotty credit records. The acquisition has been well-received because it raised HSBC's U.S. profit, complementing its huge Europe and Asia businesses.

Last month, the U.S. unit said a portfolio of consumer loans it acquired recently had quickly soured. This month, HSBC underscored the loan situation was worsening. That has led to an unexpected rise in delinquency rates in mortgage-related debt. These loans are secured with collateral, so the bank's ultimate losses may be pared. Still, it could portend further losses in unsecured credit-card loans. The problems have arisen despite HSBC's having one of banking's best computerized systems for analyzing consumer risk.

"Our concern is that next year, the worsening is going to spread beyond the secured-loan book and actually going to start impacting the unsecured book," said Antony Broadbent, a bank analyst at Sanford C. Bernstein in London. "And economically, that is a far bigger deal because of the amount of unsecured lending that HSBC has and, frankly, because the loss rates on that business are much higher."

HSBC is the world's third-largest bank in terms of market value behind Citigroup Inc. and Bank of America Corp., both of the U.S....

HSBC said in Securities and Exchange Commission filings that it first experienced deterioration in the second quarter with loans originated in 2005. By the third quarter, HSBC was seeing a weakening of loans originated in 2006. That meant new loans quickly were running into trouble. "You always talked about one of the great advantages of your model is being predictive in terms of bad debts and the bad-debt charge always coming out fairly close to where you expect it at the beginning of the year," Merrill Lynch analyst John-Paul Crutchley told HSBC executives, according to a transcript of a Nov. 14 conference call. The loan book "seems to have deteriorated more quickly than you expected."...

An SEC filing in November showed unpaid bills of two months or more represented 3.99% of assets overseen or managed by HSBC Finance Corp., the U.S. business that includes mortgages, auto loans and credit cards. That compared with 3.57% at the end of June. The provision for credit losses in the third quarter for the U.S. unit totaled $1.38 billion, up from $1.25 billion in the second quarter.

In a trading update and conference call this month, HSBC Holdings told investors an additional three weeks of credit data showed the quality of the loans was worsening. Douglas Flint, HSBC's group finance director, said, "We have seen more data now coming into the fourth quarter, and there is a weakening trend."

Behind the problem, Mr. Flint said, was HSBC's acquiring adjustable-rate mortgages and without properly assessing their default rates. Rising U.S. interest rates exacerbated the problem.

Household's problems have come back to haunt HSBC."

Da nile is more than a river in Egypt.

#3 IndexTrader

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Posted 20 December 2006 - 02:18 PM

4% are 2 months or more late eh? :lol: I wonder what anyone expects out of a bunch of deadbeat borrowers. At any rate, Greenie needs worse numbers than that for "civil war" to break out in California. IT

#4 jawndissedi

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Posted 20 December 2006 - 02:25 PM

4% are 2 months or more late eh? :lol: I wonder what anyone expects out of a bunch of deadbeat borrowers. At any rate, Greenie needs worse numbers than that for "civil war" to break out in California.

IT


Maybe you'll like this one better -- it's from BW's Xmas edition:

Foreclosure Vise
Da nile is more than a river in Egypt.

#5 IndexTrader

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Posted 20 December 2006 - 02:41 PM

4% are 2 months or more late eh? :lol: I wonder what anyone expects out of a bunch of deadbeat borrowers. At any rate, Greenie needs worse numbers than that for "civil war" to break out in California.

IT


Maybe you'll like this one better -- it's from BW's Xmas edition:

Foreclosure Vise


Nothing new here. Always too bad to see an unintended practice....but it happens when you're dealing with bureaucracy. What you should be getting from this article though is that these lenders are going to bend over backwards to keep these people in their homes, if there is any way at all to do a workout. And I expect this practice to accelerate as more people have problems upon reset.

IT

#6 jawndissedi

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Posted 20 December 2006 - 03:31 PM

4% are 2 months or more late eh? :lol: I wonder what anyone expects out of a bunch of deadbeat borrowers. At any rate, Greenie needs worse numbers than that for "civil war" to break out in California.

IT


Maybe you'll like this one better -- it's from BW's Xmas edition:

Foreclosure Vise


Nothing new here. Always too bad to see an unintended practice....but it happens when you're dealing with bureaucracy. What you should be getting from this article though is that these lenders are going to bend over backwards to keep these people in their homes, if there is any way at all to do a workout. And I expect this practice to accelerate as more people have problems upon reset.

IT


What I get from this article is that predatory lenders will do whatever they can to get one more "rip" from an FB before they go under.
Da nile is more than a river in Egypt.

#7 greenie

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Posted 20 December 2006 - 04:15 PM

4% are 2 months or more late eh?


The absolute number is not important here. We are looking at the 'upside breakout' (in trading terms).


Everyone is spending, spending. Bush spends 1/2 trillion in Iraq, homeowners want to spend few trillions on home improvement and new SUVs, Californians want to spend few billions in pet projects - where is the money going to come from? The future. If future has been spent already, what happens when future arrives?

There will be so much demand for dollars and so little supply, that I am puzzled that some people are still talking about dollar crash !! No dollar collapse in store, never. Maybe a bit of decline is possible.


BTW folks (not directed at you IT), Fed DOES NOT PRINT MONEY. Once that is clear to you, the rest will be obvious.
It is not the doing that is difficult, but the knowing


It's the illiquidity, stupid !

#8 OEXCHAOS

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Posted 20 December 2006 - 04:28 PM

Things are far better than you think, Greenie. In fact, they are so good it's about to get tough for the stock market, strangely enough (I suspect). From TrimTabs: TrimTabs Overnight Liquidity Update – December 19, 2006 U.S. Economic Growth Accelerating, Not Slowing. Withheld Taxes Up 7.8% Y-o-Y in Q4 2006 through December 15 versus 5.0% Y-o-Y in Q3 2006. “Other Than Withheld” Taxes Up 21.1% Y-o-Y Year-to-Date. While some of Wall Street’s finest still firmly believe that the U.S. economy is cooling, real-time data indicates that growth is accelerating rather than slowing. The Federal Reserve has been trying to convey this message to the markets, but its pronouncements are unheeded because most market strategists and financial journalists rely on the nonsense released by the Bureau of Economic Analysis and the Bureau of Labor Statistics. Based on real-time tax collections data from the Daily Treasury Statement, income and employment taxes withheld from the paychecks of everyone subject to withholding are up 7.8% year-over-year quarter-to-date, up from 5.0% year-over-year in Q3 2006. In addition, “Other than withheld” income and employment taxes--including payments by the self-employed--are up a whopping 21.1% year-over-year year-to-date. There is no way these huge increases in tax collections are due solely to income gains by high earners. more at www.trimtabs.com Tell them Traders-talk sent you. Mark More relevant to the real estate "debacle-geddon" that so many are absolutely convinced of (also from TrimTabs): Twelve-Month Running Total of TrimTabs Savings and Investment Flow Soars to Record High $696 Billion in November. Individual Investors Pumping Increasing Amounts of Cash They Are Generating into Equities: $13.9 Billion Flows into Equity Funds First Half of December. American consumers are generating prodigious amounts of cash. As Madeline Schnapp reported in today’s issue of TrimTabs Personal Income and Consumer Cash Flow Analysis, the twelve-month running total of TrimTabs Savings and Investment Flow reached an all-time high of $696.5 billion in November. This indicator tracks inflows into savings vehicles (bank savings, small-denomination CDs, half of large-denomination CDs, and retail money market funds) as well as all long-term stock, bond, and hybrid mutual funds. Our latest flow data indicates that individual investors are putting lots of cash to work in equity funds. We estimate that $5.8 billion flowed into U.S. equity funds and $8.1 billion flowed into global equity funds this month through December 15. U.S. equity funds are on track to post their highest monthly inflow since April, having already surpassed November’s estimated $5.0 billion inflow. get a trial at www.trimtabs.com, tell them Traders-talk sent you.
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#9 SemiBizz

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Posted 20 December 2006 - 04:42 PM

More relevant to the real estate "debacle-geddon" that so many are absolutely convinced of (also from TrimTabs):

Twelve-Month Running Total of TrimTabs Savings and Investment Flow Soars to Record High $696 Billion in November. Individual Investors Pumping Increasing Amounts of Cash They Are Generating into Equities: $13.9 Billion Flows into Equity Funds First Half of December.

American consumers are generating prodigious amounts of cash. As Madeline Schnapp reported in today's issue of TrimTabs Personal Income and Consumer Cash Flow Analysis, the twelve-month running total of TrimTabs Savings and Investment Flow reached an all-time high of $696.5 billion in November. This indicator tracks inflows into savings vehicles (bank savings, small-denomination CDs, half of large-denomination CDs, and retail money market funds) as well as all long-term stock, bond, and hybrid mutual funds.

Our latest flow data indicates that individual investors are putting lots of cash to work in equity funds. We estimate that $5.8 billion flowed into U.S. equity funds and $8.1 billion flowed into global equity funds this month through December 15. U.S. equity funds are on track to post their highest monthly inflow since April, having already surpassed November's estimated $5.0 billion inflow

.

Did you leave out a significant portion of this article? I can't quite make the connection to the housing bubble... :unsure:

Overall though, it's BOOOOLISH. And that's what we need a lot more BOOOLS. Gov't revenues, Gov't debt and private debt at the highs... BOOOLISH. And then on top of that record equity inflows... yeah, that's what we need alright... :redbull:



Get em all in just like 2000... New Pair O Dimes... Heck, why not 3?



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Edited by SemiBizz, 20 December 2006 - 04:47 PM.

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#10 OEXCHAOS

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Posted 20 December 2006 - 05:09 PM

The point is, the consumer apparently isn't as levered as many fear... "American consumers are generating prodigious amounts of cash. As Madeline Schnapp reported in today's issue of TrimTabs Personal Income and Consumer Cash Flow Analysis, the twelve-month running total of TrimTabs Savings and Investment Flow reached an all-time high of $696.5 billion in November. This indicator tracks inflows into savings vehicles (bank savings, small-denomination CDs, half of large-denomination CDs, and retail money market funds) as well as all long-term stock, bond, and hybrid mutual funds. "
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