In April 2007, we issued a report headlined The Second Wave of the Housing Tsunami: 2007-2011 in which we suggested commercial real estate was likely to be the second shoe to drop in what was already an unnerving collapse in the residential housing market. Some of the more speculative plays we issued in the report [...]
It’s time for a second wave of deflation according to Robert Prechter, author of Conquer the Crash. He believes that yesterday’s selloff is a sign that we’re in for a week or two of more “pretty serious selling.” From TechTicker: “The global selloff in stocks accelerated Thursday, sending the Dow down 3.6% to 10,068 while [...]
Our economy is about to relapse into the disease that sent us into the Great Depression: Part Deux. Subprime loans caused the initial illness. Option-ARMs will cause the relapse. In the first half of the past decade, subprime loans were king. They were cheap and easy to get approved. Along with the subprime boom came [...]
The second wave of ARM resets and foreclosures might come sooner than you think. According to Whitney Tilson and Glenn Tongue of T2 Partners, the experts on this subject, about 80% of option ARMs are negatively amortizing. Meaning these so-called top-tier borrowers are heading further into the hole. Once their rates reset, they could be [...]
The Dow rose 200 points yesterday, bringing it only about 75 points below the 10,300 level. Why is the 10,300 mark important? It’s not really…it’s just the point where this bounce will equal the bounce following the crash of ’29. No reason in particular that this bounce should be the same as the one 80 [...]
Jeremy Grantham, chairman of asset management firm GMO, has released his latest letter and he’s focused on how the financial system should be redesigned. He offers a valuable two step process for potentially avoiding a second wave of financial crisis. The first step he suggests is banning or separating the aggressive proprietary trading at banks [...]
If you’re looking for insight into how you should be responding to the “recovery” in the US economy, there’s actually a glimmer of sanity coming leading US companies. Right now major American companies are storing up more cash than at any other time within the past 40 years. According to media reports, Citigroup and JPMorgan [...]
