Bear Stearns is toasted
- Thread starter danmand
- Start date
There is no way Bear Stearns is going under, WAYYY too much is riding on it. We will go into a depression from the domino effect and no way the govt. is going to allow that.
This is the perfect time for middle east's sovereign funds to pounce, therefore gaining more control over US.
This is the perfect time for middle east's sovereign funds to pounce, therefore gaining more control over US.
Depression has been rumoured. You won't here it publicly stated in the media, though.
BTW- I got a notice email from my discount brokerage account warning that they will not be issuing margin on new transactions until further noticed... It was a generic notice to all of their clients. I'm wondering if more Canadian discount brokerages will follow suit... and if so, why is it so bad here in Canada...?
and the US Fed has a new CEO it seems... Dr. Strangelove:
http://wallstreetexaminer.com/blogs/winter/?p=1476
The bottom line behind all of this is that, thanks to a new policy change, the US Fed is now 'trading' US Treasuries for the toxic mortgage paper held by troubled investment banks via a fresh round of loans. The Fed is also letting rumors hit the street that these loans may turn into outright purchases / trades. This of course improves the banks' credit situation and lowers the banks' default risk, but it also implements a de-facto responsibility on the US taxpayer to make good on the toxic mortgage paper bought by the US Fed !!!!!! Obviously, the US stock and commodities markets went crazy today as a result !
This morning the Fed announced yet another new program to provide liquidity to failing markets. The program is called the Term Securities Lending Facility (TSLF).
"This is not a liquidity problem but a solvency problem. For all practical purposes the game is up but the Fed does not know it yet."
all of these new measures by the US Fed, which essentially exchange 'toxic waste' held by banks for US Treasury Bonds at face value, are creating a potential taxpayer bailout of the banking system that could very well bankrupt the country.
BTW- I got a notice email from my discount brokerage account warning that they will not be issuing margin on new transactions until further noticed... It was a generic notice to all of their clients. I'm wondering if more Canadian discount brokerages will follow suit... and if so, why is it so bad here in Canada...?
and the US Fed has a new CEO it seems... Dr. Strangelove:
http://wallstreetexaminer.com/blogs/winter/?p=1476
The bottom line behind all of this is that, thanks to a new policy change, the US Fed is now 'trading' US Treasuries for the toxic mortgage paper held by troubled investment banks via a fresh round of loans. The Fed is also letting rumors hit the street that these loans may turn into outright purchases / trades. This of course improves the banks' credit situation and lowers the banks' default risk, but it also implements a de-facto responsibility on the US taxpayer to make good on the toxic mortgage paper bought by the US Fed !!!!!! Obviously, the US stock and commodities markets went crazy today as a result !
This morning the Fed announced yet another new program to provide liquidity to failing markets. The program is called the Term Securities Lending Facility (TSLF).
"This is not a liquidity problem but a solvency problem. For all practical purposes the game is up but the Fed does not know it yet."
all of these new measures by the US Fed, which essentially exchange 'toxic waste' held by banks for US Treasury Bonds at face value, are creating a potential taxpayer bailout of the banking system that could very well bankrupt the country.
porn_lover said:
Yep, you were right, Bear Stearns is not going bankrupt--they sold them selfs for $2 a share!
All those share holders who were down 47% last Friday should have sold then, could have got between $27 to $37 a share. Thats looks sooo good now
I heard some guy bought 17,000 put options on BSC last Wednesday March 12/08 with an expiry of March 25, 2008. for about 35 cents a share.
If let's say, the strike price on the put option was $55.00 a share, then he can sell his 17,000 puts for 55.00 a share to the company that issued the put option contract to him.
That's 17,000 * 55.00 = 935,000 on an investment of about $6,000.
If let's say, the strike price on the put option was $55.00 a share, then he can sell his 17,000 puts for 55.00 a share to the company that issued the put option contract to him.
That's 17,000 * 55.00 = 935,000 on an investment of about $6,000.
$2 per share?! I couldn't believe it when I read it. But there it was on all the news sites. That's one sure-fire way to kill a bear!
But at the same time, good for the folks at JP Morgan. Talk about killer instinct and being in the right place at the right time. I'll bet the CEO and the whole executive team at JP get gigantic bonuses this year!
In any case, although approved by the Fed and the US Treasury, I think it still needs shareholder approval. I believe the major shareholder is a fellow in the Bahamas who recently (Sept?) paid over $800 million for a 7% share which he later upped to 10%. That guy must be pissed because he'd stand to lose over $785 million of his initial "investment".
But at the same time, good for the folks at JP Morgan. Talk about killer instinct and being in the right place at the right time. I'll bet the CEO and the whole executive team at JP get gigantic bonuses this year!
In any case, although approved by the Fed and the US Treasury, I think it still needs shareholder approval. I believe the major shareholder is a fellow in the Bahamas who recently (Sept?) paid over $800 million for a 7% share which he later upped to 10%. That guy must be pissed because he'd stand to lose over $785 million of his initial "investment".
boffo said:
Well thats good, its about 1% of what Joe Lewis lost. Saw the CEO of Bear interviewed on Wednesday morning stating that all is well, yadda yadda. This guy is in hot water up to his nuts. Whether he knew what was coming or not, he should have. He's going to have law suits coming out his ying yang. This will make Spitzer look like a saint. Markets will tank in the morning. Watch out for Goldman and Lehman earnings on Tuesday morning.
hunter001 said:
As of right now, they're not doing very well. Big surprise. Carlyle Capital also said they were going to liquidate all assets. Won't be anything for shareholders of course. This is getting real ugly real quick. Bargains will be plentiful by weeks end I suspect.
WOW, when I said they were not going to declar bankruptcy I did not expect this, hell this is as good as declaring bankruptcy in a nicer way.
This just tells you how much in shit Bear Stearns is in, by putting a price tag of $2/share.
I heard about the puts on BNN too, dam that lucky trader.
Should be a VERY interesting market in the coming weeks. I think more companies are in the same boat, never trust the CEOs.
This just tells you how much in shit Bear Stearns is in, by putting a price tag of $2/share.
I heard about the puts on BNN too, dam that lucky trader.
Should be a VERY interesting market in the coming weeks. I think more companies are in the same boat, never trust the CEOs.
Basically, Bear Stearns went broke on Friday.
At 2 bucks a share, it might was well be 2 cents (A year ago they were trading at $170 a share.) My guess would be that the FED didn't want BS to go broke because then everything gets hauled into bankruptcy court in full public view and no-one wants to shine that light. No-one wants an all out panic either, least of whom would be the FED. By having Morgan buy them out for pennies, (which the FED issued to JP Morgan) everything goes into a file somewhere and never sees the light of day. The roaches are safe for now. This way, only the share holders and employees get screwed. The fat cats remain safe. It will be interesting to see what sort of golden handshake the fat cats at BS get after all of this.
What happened last week was a good old fashioned "run on the bank". Only this time, there was no need to line up, everything was done through electronic transfers. How lucky. I believe BS was one of the five largest banks on Wall Street.
The FED also took the unprecidented step of lowering rates by .25 on A SUNDAY. The FED also meets again for its regular meeting this week and all bets are a one point hair cut.
The Bank of Canada will have no choice but to follow suit unless you want a dollar at 1.25. Canada being an exporting country who's currency has appreciated drastically against the US dollar will soon find itself fighting to lower the value of the dollar.
At 2 bucks a share, it might was well be 2 cents (A year ago they were trading at $170 a share.) My guess would be that the FED didn't want BS to go broke because then everything gets hauled into bankruptcy court in full public view and no-one wants to shine that light. No-one wants an all out panic either, least of whom would be the FED. By having Morgan buy them out for pennies, (which the FED issued to JP Morgan) everything goes into a file somewhere and never sees the light of day. The roaches are safe for now. This way, only the share holders and employees get screwed. The fat cats remain safe. It will be interesting to see what sort of golden handshake the fat cats at BS get after all of this.
What happened last week was a good old fashioned "run on the bank". Only this time, there was no need to line up, everything was done through electronic transfers. How lucky. I believe BS was one of the five largest banks on Wall Street.
The FED also took the unprecidented step of lowering rates by .25 on A SUNDAY. The FED also meets again for its regular meeting this week and all bets are a one point hair cut.
The Bank of Canada will have no choice but to follow suit unless you want a dollar at 1.25. Canada being an exporting country who's currency has appreciated drastically against the US dollar will soon find itself fighting to lower the value of the dollar.
The next one to go down is a massive section of Citigroup. Bush Jr. and his cronies are lying. America is in serious shit.
Gyaos Baltar.
Gyaos Baltar.
Can you believe this company sold at a market cap of $250,000,000 and only a year ago it's market cap was $20,000,000,000 !!!!!!! Unbelievable, the bigger you are the bigger you fall.
I also heard Lehman is next on the chopping block....... fascinating stuff.
I also heard Lehman is next on the chopping block....... fascinating stuff.
Uhhh, no .
Secondly, if someone bought that many puts 12 dollars out of the marker with 2 weeks till expiry, it was inside info and the guy is going to jail.
Complete bs
First of all what do you mean ''you heard '' ?boffo said:
Secondly, if someone bought that many puts 12 dollars out of the marker with 2 weeks till expiry, it was inside info and the guy is going to jail.
Complete bs
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