Originally Posted By Sport Goofy << At this point in time any profit at all for investment banks is good news. >> I just listened to part of the conference call for Lehman. Some curious questions about the value of their securities backed by mortgages and the like. It seems Lehman is still carrying a large part of their mortgage portfolio at full value. They decided not to do a full write-down this quarter while they "wait and see" if the housing market turns around. Well, I have a news flash for Lehman, the housing market isn't going to turn around. Inventories are swelling to record levels already for the summer real estate season. Bloated inventories and buyers that can't get approved for mortgages equals real estate melt-down this summer. The worst is yet to come for the U.S. housing market. Last summer, the effects of the credit crunch weren't even felt in the housing market until mid-August. This year, the entire summer selling season will be impacted. It will be ugly. Lots of Americans, who plan their job transfers and moves in conjunction with the summer school breaks, are going to find that they cannot sell their homes and they will be paralyzed to move their families, hold onto new jobs, or face the reality of selling their homes at significant losses. So, Lehman and Goldman are just delaying the inevitable. At some point, they'll have to let their investors face the music.
Originally Posted By Mr X Haven't researched the Lehman situation much (though investors apparently like what they see today)... As for Goldman though...they seem to be in a class by themselves. THEY, unlike the others, actually saw the danger for what it was and short sold the subprime mess... I think Goldman will come out on top of this mess. If there are any really bad days for Goldman, I'd say "buy em". Just my 2 cents. And yes, I agree with SG about the obfuscation going on right now. Believe these guys? God no! I wouldn't trust them to tell me where the nearest hospital was...this whole game is a slime infested cesspool. Now more than ever. It really amazes me that company after company can lie and get away with it. To the detriment of their clients, their stockholders, their employees...the only ones spared are the CEO's who are walking away with millions. I get emails constantly regarding class action suits against these guys (the amusing part is that I was only short selling the companies...so I gained rather than lost but somehow I'm still on the mailing list).
Originally Posted By fkurucz <<Lots of Americans, who plan their job transfers and moves in conjunction with the summer school breaks, are going to find that they cannot sell their homes and they will be paralyzed to move their families, hold onto new jobs, or face the reality of selling their homes at significant losses.>> Some will need to be a little less stubborn regarding the value of their house when they put it on the market. They often think that just because they won't get the peak price that they are "selling at a loss", even though they bought it years ago for a fraction of the current market value. My brother had to move 6 months ago. He listed his house a the price suggeste dby his realtor. It sat for months. Lower the price I told him. He was afraid that he would be "giving it away" if he did that, but after a few months he realized that he wasn't going to get his wished for price. So he lowered the price 10% (undercutting everyone else in the neighborhood) and it sold in a week, and he still walked away with a 50% gain. Now for those who bought at the peak with no down or low down loans, I have only two words: jingle mail.
Originally Posted By SuperDry <<< Some will need to be a little less stubborn regarding the value of their house when they put it on the market. They often think that just because they won't get the peak price that they are "selling at a loss", even though they bought it years ago for a fraction of the current market value. >>> Or how about the notion of "I can't get what it's worth!" You can ALWAYS get what it's worth.
