3 replies to this topic

[nimblebear]

http://www.marketwat.....E63E9AD525ED}

[endisnear]

My brother bot a 1900 sq ft dungheap in Hollywood hills for $850k last month. Nothing upgraded ever. Thinks he got a steal b/c listed last summer for $900k w no takers. You guessed right, ARM loan resetting in one yr ...10% down.... Oh did I tell you he and wife are teachers... they'll be upide down in 9-12 mos and his pmt will double about the same time... He's married to it and, most likely, he'll be a forclosure statistic withn 2-3 yrs.

[briarberry]

I keep watching the trouble in the property market, but as you've probably noticed - all the obvious shorts are already over subscribed


FED Some 40% of the company's 15.3 million shares have been sold short.



From Business Week. “FirstFed Financial Corp. may be the riskiest mortgage lender around. In the fourth quarter, mortgage originations plummeted by 66.8%, to $365 million—one of the steepest declines among all lenders.”

“Cash from operating activities dropped into the red in the third quarter (the most recent data available), falling from $49 million in 2005 to negative $77.1 million a year later. Meanwhile, the number of problem loans more than quadrupled last year.”

“The biggest problem: Its mortgage portfolio is packed with risky loans known as option ARMS. All of FirstFed’s mortgages are for homes in California, where prices have cratered and foreclosures have skyrocketed. Also, 80% of its loans have little or no documentation to prove the borrower’s income or assets, according to a recent company presentation.”

“The bulk of FirstFed’s income is derived from noncash earnings, largely from the deferred principal on its option ARMs. That so-called negative amortization constituted $223.9 million, or 68.4%, of the bank’s income before taxes in 2006, compared with 1.3% in 2004. In essence, FirstFed is booking profits on money it hasn’t collected.”

Still, given all the red flags, it's no wonder short-sellers have pounced. Some 40% of the company's 15.3 million shares have been sold short. That dynamic may have helped boost the stock. As it climbs, hedge funds and others rush to buy more shares to cover their money-losing short position, pushing the stock higher.

http://www.businessw...ampaign_id=yhoo

http://finance.yahoo.com/q/pr?s=fed

http://stockcharts.c...allery.html?FED

[eminimee]

Even losers get a chance at a pop......not going to touch it though.

http://stockcharts.c...0586&r=8546.png