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[quote author="awgee" date=1245210683]Tuesday, June 16, 2009

GE Capital Is Back In The Game To Win It



Posted by Tyler Durden at 1:01 PM



<em>

After providing several hundred billion in second liens and other subordinated tranches to some of the worst companies in existence over the past 5 years, a result of a complete lack of investing discipline which nearly brought parent General Electic down, GE Capital Corp. is back in the game, and this time it plans to win it. Bankrupt commodity product rollup extraordinaire Spectrum Brands (provider of such deflation worthless products as Remington shavers and Rayovac batteries) announced it has secured a $242 million exit financing as part of its emrgence into a "normal" company, with none other than perma-glutton for punishment, GE Capital.



The company went bankrupt after several Goldman led refies in 2007 straddled it with over $4 billion in debt. One can bet that Goldman syndicated any exposure faster than you can say Lllloyd: Zero Hedge would not be surprised if it was GE Capital itself that ended up being on the receiving end of the soon to be worthless paper.



But you gotta put capital to use: and those GECC principals are just so familiar with the whole zinc forward curve, and lawn manure comps that it would be a waste not to capitalize on that extensive experience. We give GE about a year before it manages to again somehow be underwater this particular investment.</em></blockquote>
I think I said it once, but I'll say it again. GE Capital will bring GE down to its knees.
 
<blockquote>'The Wealth of the Baby Boom Cohorts After the Collapse of the Housing Bubble

David Rosnick and Dean Baker



" Finally, the projections show that for both age groups, the renters within each wealth quintile in 2004 will have more wealth in 2009 than homeowners in all three scenarios. In the second and third scenarios, renters will have dramatically more wealth in 2009 than homeowners who started in the same wealth quintile. Homeownership is not everywhere and always an effective way to accumulate wealth. For those who owned a home in the last few years, the collapse of the housing bubble led to the destruction of much or all of their wealth."



</blockquote>


<a href="http://www.cepr.net/index.php/publications/reports/the-wealth-of-the-baby-boom-cohorts-after-the-collapse-of-the-housing-bubble/">the report</a>
 
<a href="http://content1.clipmarks.com/content/7E8ADC46-F3DD-4D6F-B184-3A07CF501B7C/ ">http://content1.clipmarks.com/content/7E8ADC46-F3DD-4D6F-B184-3A07CF501B7C/ </a>



Sean Hannity - come get some of Keith Obermans' money!
 
<a href="http://market-ticker.denninger.net/archives/1177-BOOM!-More-Obfuscation.html">Someone paid 7% for overnight money on the Fed Trading system last night.</a>



What do you guys make of this? The author is speculating that it's a bank (probably is), but is there a real reason someone would overpay?
 
[quote author="irvine_grad" date=1246576253]<a href="http://market-ticker.denninger.net/archives/1177-BOOM!-More-Obfuscation.html">Someone paid 7% for overnight money on the Fed Trading system last night.</a>



What do you guys make of this? The author is speculating that it's a bank (probably is), but is there a real reason someone would overpay?</blockquote>
I bet you it's for the State of California. The General Obligation Bond are yielding close to 7%.
 
I just got back from my vacation and market is on fire, so it's time to put things in perspective,



WHAT?S THE STOCK MARKET PRICING IN?

Well, the S&P 500 surged 15% in the second quarter and what we did was go back in the history books to see what happens to the economy the very next quarterly typically after such a big bounce and the answer is ? just over 3% real GDP growth. So consider that de facto what is being discounted at this time for current quarter growth ? it better be a humdinger of an inventory build. Now, for the market to build on such a rapid advance in the current quarter, history again suggests that we would need to see 5?% real GDP growth, which we give near-zero odds of occurring. Hence our call for a sputtering stock market through year-end. Too much growth ? and hope ? is priced in at this point.
 
[quote author="BondTrader" date=1248388728]I just got back from my vacation and market is on fire, so it's time to put things in perspective,



WHAT?S THE STOCK MARKET PRICING IN?

Well, the S&P 500 surged 15% in the second quarter and what we did was go back in the history books to see what happens to the economy the very next quarterly typically after such a big bounce and the answer is ? just over 3% real GDP growth. So consider that de facto what is being discounted at this time for current quarter growth ? it better be a humdinger of an inventory build. Now, for the market to build on such a rapid advance in the current quarter, history again suggests that we would need to see 5?% real GDP growth, which we give near-zero odds of occurring. Hence our call for a sputtering stock market through year-end. Too much growth ? and hope ? is priced in at this point.</blockquote>
I've never seen a market up everyday for 2 weeks straight. It's just nuts...I don't get it. The shorts must be on vacation or something. Looks like we are going to S&P over 1,000 this summer and Dow over 10,000. The higher and faster we go up, the harder we crash???
 
[quote author="usctrojanman29" date=1248388977][quote author="BondTrader" date=1248388728]I just got back from my vacation and market is on fire, so it's time to put things in perspective,



WHAT?S THE STOCK MARKET PRICING IN?

Well, the S&P 500 surged 15% in the second quarter and what we did was go back in the history books to see what happens to the economy the very next quarterly typically after such a big bounce and the answer is ? just over 3% real GDP growth. So consider that de facto what is being discounted at this time for current quarter growth ? it better be a humdinger of an inventory build. Now, for the market to build on such a rapid advance in the current quarter, history again suggests that we would need to see 5?% real GDP growth, which we give near-zero odds of occurring. Hence our call for a sputtering stock market through year-end. Too much growth ? and hope ? is priced in at this point.</blockquote>
I've never seen a market up everyday for 2 weeks straight. It's just nuts...I don't get it. The shorts must be on vacation or something. Looks like we are going to S&P over 1,000 this summer and Dow over 10,000. The higher and faster we go up, the harder we crash???</blockquote>


Well, we all knew this market is manipulated, they (PPT) could run it all the way up to S&P 1500 if they want, but that will push the T-bond rates way higher and trash the dollar. Fed/Treasury is joggling two tasks, one is to keep this rally going as long as possible, the other is to prevent dollar from collapsing. Eventually they will fail both. Dollar will collapse with so much money already printed and will be printed. Though China will keep buying for sometime, but trust me on this (as I just got back from China and did a lot DD on this subject), China is reducing it's dollar reserve secretly and buying gold and other commodities as replacements.
 
[quote author="BondTrader" date=1248391356][quote author="usctrojanman29" date=1248388977][quote author="BondTrader" date=1248388728]I just got back from my vacation and market is on fire, so it's time to put things in perspective,



WHAT?S THE STOCK MARKET PRICING IN?

Well, the S&P 500 surged 15% in the second quarter and what we did was go back in the history books to see what happens to the economy the very next quarterly typically after such a big bounce and the answer is ? just over 3% real GDP growth. So consider that de facto what is being discounted at this time for current quarter growth ? it better be a humdinger of an inventory build. Now, for the market to build on such a rapid advance in the current quarter, history again suggests that we would need to see 5?% real GDP growth, which we give near-zero odds of occurring. Hence our call for a sputtering stock market through year-end. Too much growth ? and hope ? is priced in at this point.</blockquote>
I've never seen a market up everyday for 2 weeks straight. It's just nuts...I don't get it. The shorts must be on vacation or something. Looks like we are going to S&P over 1,000 this summer and Dow over 10,000. The higher and faster we go up, the harder we crash???</blockquote>


Well, we all knew this market is manipulated, they (PPT) could run it all the way up to S&P 1500 if they want, but that will push the T-bond rates way higher and trash the dollar. Fed/Treasury is joggling two tasks, one is to keep this rally going as long as possible, the other is to prevent dollar from collapsing. Eventually they will fail both. Dollar will collapse with so much money already printed and will be printed. Though China will keep buying for sometime, but trust me on this (as I just got back from China and did a lot DD on this subject), China is reducing it's dollar reserve secretly and buying gold and other commodities as replacements.</blockquote>
PPT is out in full force this morning...a slight up open and all of a sudden we are up 200pts on the Dow and over 20pts on the S&P. I got stopped out of a few short positions the past few weeks and took some losses but sitting on cash right now. I can't wait to see what the media spin is going to be when the DOW gets above 10,000...my guess is gonna be...."recession is over, all is well, v-shaped recovery." Have I been the only one to see that companies are making the EPS or beating EPS estimates by cost cutting with no revenue growth???
 
<a href="http://www.msnbc.msn.com/id/31971034/ns/business-reinventing_america/">Lasting recession works way into pop culture </a>



The new HBO series ?Hung? premiered this summer with scenes of abandoned Detroit factories and a voiceover lamenting how the city has gone to seed ? along, we soon learn, with the life of the show?s protagonist, Ray Drecker.



Drecker is a guy many Americans can relate to these days. A star athlete in his youth, he now finds himself struggling: divorced, behind on his adjustable-rate mortgage and worried he might lose his job as a high school basketball coach because of budget cuts.



?Sex and the City? it is not.

Story continues below ?advertisement | your ad here



As the recession drags well into its second year, the battered economy is being reflected in all aspects of popular culture, including television shows about tough times, "chick lit" books offering penny-pinching tips and movies about downsized executives.



Even long-running pop culture icons have not been spared. On "The Simpsons," Homer and Marge were forced to sell their house after their mortgage payment skyrocketed, characters at ?30 Rock? grappled with budget cuts and the boys from ?South Park? were taught a lesson in the dizzying effects of the financial crisis.



Barry Ritholtz, author of ?Bailout Nation? and an investor who runs a popular financial blog, said he used to see pop culture references to hard economic times as a contrary indicator. That?s because most recessions since World War II have been so short that they were over by the time they were portrayed on television or in movies.



But this time, he said, the recession has dragged on long enough that financial issues already have been reflected in every aspect of entertainment, from soft sales of concert tickets to favorite television characters cutting back on lavish dinners.



?On the one hand, it?s good when it becomes part of popular culture because people are talking about it and thinking about it,? he said. But on the other hand, ?It?s bad when people are obsessing about it to the point of absurdity.?



Indeed, in past downturns popular culture often has been seen as a way to escape from, rather than delve into, economic problems.



Robert Thompson, professor of popular culture at Syracuse University, notes that shows such as ?Dynasty,? which portrayed an opulent lifestyle, thrived during the economic hard times of the 1980s, while elaborate musicals were popular during the Great Depression.



?If you?ve got a loved one dying of cancer, you may not want to watch, as your entertainment, movies of loved ones dying of cancer,? Thompson said.



'Hung' hangs on economic themes

Michael Lombardo, HBO?s president of programming and West Coast operations, said it was largely coincidence that ?Hung? went into production just as the economy was faltering. But the show's writers have taken the opportunity to work the recession themes more heavily into the plotline, he said.



In one scene, Drecker laments taking out an ARM on his parent?s house ?that?s now got a hand around my throat.? In another, a character who plays a personal shopper explains that ?my ladies are so loaded, they?re recession-proof.?



Lombardo noted that it?s far from the first HBO show to delve into difficult subject matter.



?Our programming, although hopefully being entertaining, is grounded in reality,? he said. ?I don?t think we?ve ever been a company that?s looked for escapist programming.?



It?s not just premium cable channels like HBO that are reflecting the recession. From sitcoms to dramas, many shows have made reference to the economy, and experts expect to see even more when the new TV season launches in the fall.



The Fox show ?Til Death? will have a story line about a character who is having a difficult time finding a job because of the weak economy. Fox also is working on a reality show, ?Someone?s Gotta Go,? in which a worker gets laid off at the end of each episode, although an air date hasn?t been set.



Next year, Ben Affleck will star in a new movie, ?The Company Men,? about the aftermath of a corporate downsizing. Activist filmmaker Michael Moore?s new movie, ?Capitalism: A Love Story,? will be about the global economic crisis.
 
Rosenberg strikes again, with zerohedge.



<a href="http://www.scribd.com/doc/17712435/The-End-of-the-End-of-the-Recession">http://www.scribd.com/doc/17712435/The-End-of-the-End-of-the-Recession</a>
 
[quote author="CapitalismWorks" date=1248478076]Nice piece by Kasriel at Northern Trust. Note that a valuation metric very similar to rental parity is used to examine the national housing market about 2/3s of the way through the article.



http://www.safehaven.com/article-13886.htm</blockquote>
Usually Kasriel is my favorite commentator, but I think he is completely missing the foreclosure wave coming and the M0 money supply increase.
 
This is the funniest ever



<a href="http://www.thedailyshow.com/watch/wed-july-29-2009/home-crisis-investigation">Dailyshow home crisis investigation</a>
 
Sorry I've been lazy and sick the last couple days, it's about time to recap this market. First thing first, DO NOT CHASE THIS RALLY. Unless you got in in March or early July, it's too late to get in sth already went up 50%.



*Recently, we are seeing some life in real estate market driving by pending home sales went up 5 months in a row. But 80% of the volume are coming from short-sales and foreclosures at the sub 500k market. It still takes more than 13 months to sell anything above 750K. And the alt-a and prime borrowers are start defaulting even before the waves of rate resets will start in Q4 2009 and continues till end of 2011.



*We still losing jobs, 70% of US GDP is consumption. Even with trillions of dollars of stimulus pumped into the system, we still only eked out a -1% GDP in Q2 2009, imagine how ugly Q4 this year going to be if without any more stimulus.



*There are signs that the declines in employment are slowing down but at -300k plus (from a more credible source than the government, that # should be around -480k), which is the consensus for this Friday?s Nonfarm payroll number, we are still quite a bit away from seeing actual stabilization in the labor market and probably at least a year away from seeing enough jobs being created to stop the unemployment rate from going higher.



*This rally reminds me of the rally we had in 2002 after the same type of government stimulus, Fed lowering rates to 1%... We rallied a good 30% off the low established in late 2001 only to see the market drop another 50% until it eventually bottomed out in 2003. Again, throughout the history, we never had a V shaped recovery, most of times we will have several W shaped recovery until we eventually bottomed out.



*Stop watching CNBC
 
I know a number of people who have succumbed to the swine flu after airplane rides in the past few weeks.



take a trip recently?



and thanks again for the commentary.
 
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