Post by: Headless Thompson Gunner on September 25, 2008, 04:29:40 PM
Good stuff, that. Maybe we won't need that bailout afterall.
Post by: grampster on September 25, 2008, 05:14:59 PM
Post by: jamz on September 25, 2008, 05:25:42 PM
Post by: txgho1911 on September 25, 2008, 05:34:23 PM
Stick a fork in it.
NCC raised 7B early. No other bank or investment house can even start to do that now. Any funds that hold financials will loss some.
Look at congress and read between the lines. They are panicked. The great depression was a mild ressession compared to what the money bosses see coming.
OH yea NCC stinks at every level still.
Post by: Unisaw on September 25, 2008, 06:36:13 PM
Post by: stevelyn on September 25, 2008, 07:23:03 PM
Post by: longeyes on September 25, 2008, 10:44:27 PM
And who is going to be the next Sec'y of the Treasury? Scrooge McDuck?
Post by: seeker_two on September 26, 2008, 01:46:18 AM
And who is going to be the next Sec'y of the Treasury? Scrooge McDuck?
Scrooge McDuck would make a far better choice than Paulson...at least McDuck believed in not making bad loans....
Post by: djw on September 26, 2008, 02:51:01 AM
Post by: Waitone on September 26, 2008, 03:13:02 AM
Post by: HankB on September 26, 2008, 03:42:13 AM
Post by: Fly320s on September 26, 2008, 03:51:56 AM
All you'll notice is a name change on one of your future bank statements.
Post by: Manedwolf on September 26, 2008, 04:25:59 AM
Holy Crap! Your title to this thread nearly caused me heart failure. I have a 3 funds that have pieces of Wa Mu as well as a separate investment there. Maybe this news might actually get some sleep tonight??
I think your shares just became worthless, as the FDIC took over?
Your investment HELD by the bank is insured as long as it's not over $100k, but the shares, I believe, went pft.
Anyone in the market, I consider financials to be an ongoing trainwreck. Since I'm not a pro, I stay way clear. Only in mutual funds and some entertainment and bio/medical right now...
Post by: slingshot on September 26, 2008, 04:38:19 AM
Post by: Manedwolf on September 26, 2008, 04:56:27 AM
My opinion in banking stocks...If you'd ever seen Star Trek III, with Christopher Lloyd yelling "GET OUT! GET OUT OF THERE!" at the people just before the spaceship self-destructs and burns up, well...yeah. That'd be about it.
Post by: Firethorn on September 26, 2008, 05:14:32 AM
BTW, it's always interesting to go through the holdings. Lots of companies I don't recognize, but there's always ones that stand out. "I own Coca-cola?".
Post by: Sindawe on September 26, 2008, 05:34:38 AM
Quote
My opinion in banking stocks...If you'd ever seen Star Trek III, with Christopher Lloyd yelling "GET OUT! GET OUT OF THERE!" at the people just before the spaceship self-destructs and burns up, well...yeah. That'd be about it.
"EXHILARATING! ISN"T IT!."
Post by: grampster on September 26, 2008, 05:44:19 AM
Post by: HankB on September 26, 2008, 06:34:27 AM
Well, if you have bonds, they're gone. I just watched $23,000 sail off into the sunset.
So you're in the market for a torch and a pitchfork?No, I don't mean to make light of this - I've got stock exposure myself in my 401k - but so many people screwed up, and worked at screwing things up, knowing they were screwing up . . . I think it'll be a damn shame if those responsible aren't made to pay.
Post by: slingshot on September 26, 2008, 06:58:18 AM
Quote
Well, if you have bonds, they're gone. I just watched $23,000 sail off into the sunset.
And they always say investing in Bonds are safe. One of the problems is that many Money Market $ are invested in bonds. I'm afraid to look at those low earning investments.
Post by: grampster on September 26, 2008, 07:59:10 AM
Post by: Manedwolf on September 26, 2008, 08:02:02 AM
I think if you had less than $100,000 in money market, didn't Washington insure what was deposited in money market funds before Sept 17th. Or am I wrong about that too.
Yes, that should be okay. I thought you meant you had shares of WaMu. Those are worthless.
Post by: Headless Thompson Gunner on September 26, 2008, 08:07:07 AM
Quote
Well, if you have bonds, they're gone. I just watched $23,000 sail off into the sunset.
And they always say investing in Bonds are safe. One of the problems is that many Money Market $ are invested in bonds. I'm afraid to look at those low earning investments.
Post by: HankB on September 26, 2008, 08:14:31 AM
Corporate bonds, on the other hand, are just loans to the company, on which they pay interest and on which there's a presumption that they're going to pay them back over time. Not being secured by FDIC or any other arm of the Federal government, they're generally as secure as the company that issues them.
As I understand things, WaMu corporate bonds are now worthless.
Post by: TexasRifleman on September 26, 2008, 08:34:03 AM
Nice work if you can get it indeed.....
Quote
Nice work — if you can get fired from it.
That's just what one Alan H. Fishman might have thought when he woke up Friday morning.
Fishman was the new chief executive officer for Washingon Mutual — WaMu — the nation's largest savings and loan, which was taken over Thursday night by federal bank regulators and quickly dumped in a fire sale to JPMorgan Chase for the Wal-Mart-like price of $1.9 billion.
But don't cry for Fishman, who reportedly was sky-high — literally — last night, on a flight from New York to Seattle, when WaMu collapsed. Even though he's only been on the job for less than three weeks, he's bailing out with parachute worth close to $20 million, according to an executive compensation analysis conducted for the New York Times by James F. Reda Associates.
That's right, $20 million for 17 days on the job ... and his company failed.
That's just what one Alan H. Fishman might have thought when he woke up Friday morning.
Fishman was the new chief executive officer for Washingon Mutual — WaMu — the nation's largest savings and loan, which was taken over Thursday night by federal bank regulators and quickly dumped in a fire sale to JPMorgan Chase for the Wal-Mart-like price of $1.9 billion.
But don't cry for Fishman, who reportedly was sky-high — literally — last night, on a flight from New York to Seattle, when WaMu collapsed. Even though he's only been on the job for less than three weeks, he's bailing out with parachute worth close to $20 million, according to an executive compensation analysis conducted for the New York Times by James F. Reda Associates.
That's right, $20 million for 17 days on the job ... and his company failed.
Post by: Headless Thompson Gunner on September 26, 2008, 09:08:25 AM
What's wrong with Fishman's pay?
Fishman didn't cause WaMu to fail. He's a good enough executive to command the kind of contract that pays out $20mil in the event of a buyout. Why shouldn't he be paid what he's worth? The only people paying him are the people who hired him, the people who stand to lose the most if he preforms poorly.
Hell, from the perspective of WaMu's business, getting bought out is a darned good thing. It means that WaMu's bank branches stay open, their employees stay employed, and their depositors remain protected. Given the only likely alternative was bankruptcy for WaMu, it sounds like Fishman did a darned good job.
Post by: Firethorn on September 26, 2008, 09:15:32 AM
As I understand things, WaMu corporate bonds are now worthless.
From what I understand, Bonds have to be repaid before the stockholders can get anything in a liquidation.
You might not be as bad off as you think.
Post by: slingshot on September 26, 2008, 09:22:36 AM
I was referring to money market funds issued by mutal fund companies, not directly by WaMu. They are potentially invested in all kinds of different instututions with WaMu being one of them.
Post by: MillCreek on September 26, 2008, 09:31:43 AM
Post by: Manedwolf on September 26, 2008, 09:48:45 AM
Down 40% in the past few hours, value around $8 a share and falling. I expect an FDIC takeover this weekend.
Post by: Scout26 on September 26, 2008, 10:48:57 AM
I think it'll be a damn shame if those responsible aren't made to pay.
Unfortunately they're the ones in Congress holding hearings.....Barney Frank, Chuck Schumer etc.
Hint: How can you tell it's a democrat caused scandal......'cause there's no republican being raked over the coals.....
Post by: BryanP on September 26, 2008, 12:04:54 PM
Post by: grampster on September 26, 2008, 12:39:15 PM
Post by: Manedwolf on September 26, 2008, 01:11:59 PM
Kinda makes you wonder why the FDIC took over WaMu and maybe another bank just days before congress finally decides how they are going to react. Why couldn't FDIC wait till that issue was over. A few days one way or the other wouldn't make a difference...unless of course someone stands to gain from these takeovers.
If you were interested in a car only for the parts, would you rather buy it at full sticker price, or wait till someone drove it into a wall, then step in to make an offer for the salvage parts?
A lot of people at very high levels have a lot of friends in these institutions. Remember who Paulson's former employer is, for one.
Post by: Brad Johnson on September 26, 2008, 01:40:53 PM
Normally if someone "buys" a publicly traded company like WaMu, they are buying the stock by trading it for their own. The WaMu shares will be traded for JP Morgan Chase shares, though not dollar for dollar. The value of the trade will be divided among the outstanding shares of WaMu stock. That amount per share will be calculated for each WaMu shareholder. The shareholder will then receive a like dollar amount of JPMC shares in echange for their WaMu shares.
In other words...
1) JPMC says we will pay $1000 for WaMu, which has 1000 shares of outstanding stock. ($1 per share)
2) You have ten shares of WaMu stock. ($10 worth)
3) JPMC stock is worth $1.25 per share.
The $10 worth of WaMu will convert to $10 worth of JPMC at $1.25 per share.
$10 / $1.25 = 8.
You now have 8 shares of JPMC.
At least that's how it's supposed to work.
Brad
Post by: Unisaw on September 26, 2008, 03:29:25 PM
Post by: TexasRifleman on September 27, 2008, 04:35:41 AM
Quote
At least that's how it's supposed to work.
That is not what happened here. WaMu didn't sell to JPMC. The Fed shut WaMu down first. Once the FDIC declares the bank insolvent, shares are worthless.
FDIC sold some assets with value to JPMC but WaMu as a corporate entity was gone before the sale.
This is why I have a problem with the massive payout of bonus money to the ex-CEO. No shareholders get anything out of this. The CEO should not have been paid the bonus since the bank was closed BEFORE the acquisition. Shareholder equity in WaMu was nonexistent the moment the FDIC closed the doors.
I'm sure WaMu had MANY financial obligations. That they took the small amount of remaining cash and paid the ex-CEO bonus FIRST is my problem. He should have had to wait in line with all WaMu's other creditors to get paid. But he was paid first, that's not right. It has nothing to do with "class warfare" or any of that.
Post by: K Frame on September 27, 2008, 06:47:37 AM
Morgan didn't purchase all of WaMu, they purchased the banking assets. The lion's share of what they got was depositor operations and branches. I'm not 100% sure about the mortgage liability, but JP Morgan has said it will write down WaMu's loan portfolio by over 30 billion.
WaMu as an entity still exists, but has declared Chapter 11 bankruptcy.
What really pushed the seizure and sale was the fact that depositors pulled almost 17 billion out of their accounts in a little over a week, and the outflow was getting faster a lot quicker.
Post by: Waitone on September 27, 2008, 06:49:58 AM
Next up? Wachovia
Post by: Brad Johnson on September 27, 2008, 08:31:53 AM
Brad, JP Morgan isn't buying the corporate entity, just certain of its assets.
Like I said, "I haven't read the details of the buyout, so everything I'm about to say may not apply."
Brad
Post by: K Frame on September 27, 2008, 08:35:03 AM
You're smarter than you were a half hour ago.
Aren't you lucky?
Post by: Brad Johnson on September 27, 2008, 08:38:09 AM
Aren't you lucky?
Nope, that makes me "fortunate".
"Lucky" would be a bus full of nekkid Hooters waitresses.
Brad
Post by: seeker_two on September 28, 2008, 03:50:51 AM
Now you have information that may apply.
You're smarter than you were a half hour ago.
Aren't you lucky?
You're smarter than you were a half hour ago.
Aren't you lucky?
Wasn't the same thing said in the Garden of Eden once?....
