'Save Us!' Says Merrill Lynch

Reply to DB of NY

Exactly....in terms of me not providing a reference to my "statistics"! WHY is it that Gerri Willis of CNN and/or any other reporter who is reporting on the mortgage crisis only seems to cover the surface and NEVER give the full picture or truely do an investigation to get to the details. Sure there are people getting foreclosed upon and there is an increase. Coming from an accounting background, where executives showed me a thing or two about how to "report numbers", you can make any number look good or bad just in the presentation. If there was only 1 foreclosure in all the US and 2 the next year...the news would jump all over that as a 100% increase in the foreclosure rates. My question becomes, with the increase in total number of mortgages over the past few years...what is the ratio of foreclosures to performing mortgages now as compared to the same ratio in 2006, 2005, 2004 etc...... My point being the big banks are not suffering because of mortgage foreclosures, they are suffering because of the press perpetuating the negative creating a psycological freeze of the credit markets. Someone, correct me here! Someone provide us some true statistics! Resolution to market crisis....easy... stop all the bad press and get some decent reporting.

Teresa Anaya of TX @ Apr 15, 2008 21:45:53 PM

A window on how big the SIV crisis really is

I was reading comments from the Jim Sinclair web site (www.jsmineset.com) on this subject and found the most interesting thing to be that when a top economist from a top firm is calling for the monetizing of even more illiquid paper than the Fed is already doing, that it probably will be done and also that this indicates just how super serious this problem is. I believe its enormous and the long term implications for massive inflation are for me disastrous. Here is an excerpt from Jim's site.

"...

Monty Guild's Commentary

Today Merrill Lynch’s North American economist came out and predicted that government backed fiscal action is required to ‘alleviate credit market paralysis.” This means according to Merrill “the outright purchase of illiquid mortgage backed securities.” As you know this is something we have been predicting for many months now that the bandwagon is getting more crowded. We look for the government to take such action.

Once establishment organizations like Merrill and others begin such a call for action it will probably be coming.

This action will not stop a big US and European economic slowdown and substantial recession in the US, nor will it stop gold from moving much higher. It will allow the current ongoing credit de-leveraging to proceed with less cataclysmic effects upon the US and world economy in our opinion.

Respectfully yours,

Monty guild

Dear Monty,

1. These items, also known as SIVs, are items with no intrinsic or market value, nor will there be any in the future. I have discussed this many times.

2. The Fed has been buying defunct mortgage derivatives every day. Merrill wants it bigger and faster than the Fed has been buying. This gives you a window by which you can view the continuing size of this crisis.

3. To everything economic there are economic consequences, just like the side effects of miracle drugs.

4. The consequences to the monetization of bankrupt special performance contracts (called mortgage SIVs) is the making of US citizens the immediate last resort buyer of the Titanic amount of valueless crap!

5. This is exactly the flow of events that created the Weimar Experience.

6. You are right, but in the above context.

..."

Guy Duff of CA @ Mar 28, 2008 19:29:20 PM

"I keep reading that it is less than 2% of all mortgages that are failing...ie...going into foreclosure. "

Read where?

"People are saying....?"

DB of NY @ Mar 28, 2008 08:56:31 AM