BloggingStocks http://www.bloggingstocks.com BloggingStocks http://www.blogsmithmedia.com/http://www.bloggingstocks.com/media/feedlogo.gif BloggingStocks http://www.bloggingstocks.com en-us Copyright 2012 Weblogs, Inc. The contents of this feed are available for non-commercial use only. Blogsmith http://www.blogsmith.com/<![CDATA[Jim Cramer foams at the mouth]]>http://www.bloggingstocks.com/2007/08/06/jim-cramer-foams-at-the-mouth/http://www.bloggingstocks.com/2007/08/06/jim-cramer-foams-at-the-mouth/http://www.bloggingstocks.com/2007/08/06/jim-cramer-foams-at-the-mouth/#commentsFiled under: ,

Jim Cramer, the overly enthusiastic host of "Mad Money," became apoplectic just prior to the market's collapse on Friday afternoon on his CNBC "Stop Trading" spot. Cramer's ranting focused on the need for the Fed to drop rates to save humanity. It came across more that the Fed needed to drop rates to save Jim Cramer's portfolio.

The reality of the situation is if the Fed had to desperately lower rates, gold would be crashing, as was the case in the late 1990s. It is interesting looking back to what everyone was calling the Goldilock's economy then, and seeing that gold was saying otherwise. Gold proved to be correct. Remember that in 1998, oil sold for only $10 a barrel.

Today, the opposite is true: gold has formed a plateau in the $600 price range and oil demand remains strong, with its price approaching $80 per barrel.

All told, despite Cramer's ranting, liquidity is getting a little tighter and the Fed should begin dropping rates in October. I wouldn't worry too much, the sky is not falling despite what Cramer may say.

Jim Cramer foams at the mouth originally appeared on BloggingStocks on Mon, 06 Aug 2007 09:50:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>bernankecnbccollapsecramerfedinterest rateInterestRatejim cramerJimCramerliquiditymad moneyMadMoneystop tradingStopTradingMon, 06 Aug 2007 09:50:00 EST<![CDATA[Stay on the sidelines during subprime collape]]>http://www.bloggingstocks.com/2007/03/19/stay-on-the-sidelines-during-subprime-collape/http://www.bloggingstocks.com/2007/03/19/stay-on-the-sidelines-during-subprime-collape/http://www.bloggingstocks.com/2007/03/19/stay-on-the-sidelines-during-subprime-collape/#commentsFiled under: ,

Barron's did a great job attacking all the angles associated with the subprime mortgage collapse over the weekend. Below are some of the interesting data points:
  • Subprime woes are spilling over to the prime adjustable-rate-mortgage (ARMs) market. Delinquencies for Prime ARMs are now at levels seen in the 2001 US economic recession.
  • $400 billion in ARMs are scheduled to be reset during 2007 -- with few being able to be refinanced, according to an analyst.
  • Collateralized debt obligations (CDOs) market might not have seen the full impact of the subprime collapse. This market still has to be tested as to its ability to stand up in the mortgage-market downturn.
  • The growth of CDOs investing in the subprime mortgage market has increased from $9.9 billion in 2001 to $114 billion last year.
  • The total size of the subprime mortgage market approximates $1.0 trillion.
  • The subprime mortgage market makes up 15% of the total mortgage market.
Reviewing the above data and the linkage between subprime mortgages and CDOs -- and the growth in these businesses during the past few years -- points to a classic house of cards that needs to unwind. Also, Congress has come down hard on Fannie Mae and Freddie Mac during the past few years, so these government sponsored organizations are not going to be there to support this market. Therefore, this liquidity crisis could last for a while.

Let the big boys battle it out for a while. Typically, after an industry implodes there is plenty of time before a broken industry fixes itself.

Stay on the sidelines during subprime collape originally appeared on BloggingStocks on Mon, 19 Mar 2007 15:15:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>barron'sbarronscollapseindustrymortgagesubprimeMon, 19 Mar 2007 15:15:00 EST