Comments on: As Merrill Lynch Struggles, Wall Street Recoils From The Deadly Words “Mark To Market” http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/ Firedoglake weblog Wed, 25 Nov 2009 08:25:02 -0600 http://wordpress.org/?v=2.8.6 hourly 1 By: piniella http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1561521 piniella Wed, 30 Jul 2008 05:46:52 +0000 http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1561521 <p><strong>Congress panel wants to grill subprime CEOs on pay</strong><br /> Mon Jan 14, 2008 9:48pm EST</p> <p>By Kevin Drawbaugh</p> <p>Merrill said O’Neal would collect about $161.5 million in stock awards and benefits after leaving.</p> Congress panel wants to grill subprime CEOs on pay
Mon Jan 14, 2008 9:48pm EST

By Kevin Drawbaugh

Merrill said O’Neal would collect about $161.5 million in stock awards and benefits after leaving.

]]> By: Ian Welsh http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1561409 Ian Welsh Wed, 30 Jul 2008 05:04:17 +0000 http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1561409 <p>If you consider the loan amount, yes.</p> If you consider the loan amount, yes.

]]> By: steelhead http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1560983 steelhead Wed, 30 Jul 2008 01:05:07 +0000 http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1560983 <p>Oops.Forgot to post the link.</p> <p><a href="http://bigpicture.typepad.com/" rel="nofollow">http://bigpicture.typepad.com/</a></p> Oops.Forgot to post the link.

http://bigpicture.typepad.com/

]]> By: steelhead http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1560974 steelhead Wed, 30 Jul 2008 00:59:39 +0000 http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1560974 <p>It appears that Merrill actually sold at 5.47 cents on the dollar.</p> <p><a></a></p> It appears that Merrill actually sold at 5.47 cents on the dollar.

]]> By: Ian Welsh http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1560824 Ian Welsh Tue, 29 Jul 2008 22:19:50 +0000 http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1560824 <p>Ouch, very interesting.</p> Ouch, very interesting.

]]> By: Ian Welsh http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1560823 Ian Welsh Tue, 29 Jul 2008 22:17:55 +0000 http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1560823 <p>I would read <a href="http://agonist.org/numerian/20070819/the_rise_and_collapse_of_wall_streets_house_of_debt" rel="nofollow">Numerian.</a></p> <p>And <a href="http://agonist.org/diary/numerian" rel="nofollow">his archive.</a></p> I would read Numerian.

And his archive.

]]> By: goldstandard http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1560816 goldstandard Tue, 29 Jul 2008 22:09:40 +0000 http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1560816 <p>This is what really happened Ian…..<br /> Today certainly takes the cake. Or how about “this is way beyond stupid”. The cheerleaders on CNBC are just giddy about today’s Merrill Lynch news. I don’t get it, maybe I’m not supposed to. Here is the good news: 1. Merrill will raise $8.5 Billion. 2. This represents a 20% dilution of the company. 3. They are taking a $5.7 Billion writedown for the last two weeks. 4. They are selling $11 Billion worth of CDOs at 22 cents on the Dollar. 5. This is the best of all, THEY ARE FINANCING A GOOD PART OF THE SALE!!!<br /> Merrill reported earnings two weeks ago and I guess they forgot to mention these minor events. If I were a shareholder I might feel a little betrayed, or even lied to. This is disastrous, yet Wall Street is throwing a party. O.K., so they are diluting the shares by 20%, they lost almost a quarter of their book value in 14 days. This also equates to almost a quarter of their current market capitalization in 14 days. They’re selling CDOs at 22 cents on the Dollar and financing a good part of the deal. What am I missing? This means what? They get to stay in business maybe 90-180 days? What about all the other CDO holders? What kind of writedowns do they now take because Merrill puked up these CDOs at 22 cents. How much was put down as equity for purchase? Heck, this makes me want to go out and start a shell company. Maybe I could put zero money down and assume some of Merrill’s inventory. Doesn’t sound risky to me. If I can peddle the stuff higher I make some dough, if not my shell company collapses and Merrill can have the goods back.<br /> Now for the best question of all! I went through a rant this morning and my wife asked me what was wrong? I told her all of the above and she asked THE QUESTION. WHO would be stupid enough to buy the new stock? I went speechless……. That is the obvious question!<br /> I didn’t have an answer. I do now though. I was watching CNBC and they said that there were lots of smart people including I think I heard Blackstone or Blackrock group investing in this offering. Yep, yep, yep, smart people! I must be an idiot because I still don’t get it. Merrill reported earnings just 2 weeks ago and didn’t mention anything about these writedowns. Ahhhh, maybe all of this just happened in the last two weeks during the 800 point rally in the Dow. </p> <p>Here is the central question of all. Doesn’t this basically bankrupt the system? Didn’t these rocket scientist Investment Banks have leverage of 20-30-40 to one? If you include the exotic [notice without the e you can spell toxic] derivatives, some were levered at better than 100 to 1. This is a complete joke! This whole production of Alice in Wonderland would be comical to watch, except for the fact that people across the globe are going to suffer and go bankrupt and hungry. What a travesty! I do have an answer for the central question. Yes, the system has been bankrupted. Only the idiots who use common sense have figured this out. If you are an idiot and use common sense, my suggestion would be to PUT ON YOUR CRASH HELMETS!</p> This is what really happened Ian…..
Today certainly takes the cake. Or how about “this is way beyond stupid”. The cheerleaders on CNBC are just giddy about today’s Merrill Lynch news. I don’t get it, maybe I’m not supposed to. Here is the good news: 1. Merrill will raise $8.5 Billion. 2. This represents a 20% dilution of the company. 3. They are taking a $5.7 Billion writedown for the last two weeks. 4. They are selling $11 Billion worth of CDOs at 22 cents on the Dollar. 5. This is the best of all, THEY ARE FINANCING A GOOD PART OF THE SALE!!!
Merrill reported earnings two weeks ago and I guess they forgot to mention these minor events. If I were a shareholder I might feel a little betrayed, or even lied to. This is disastrous, yet Wall Street is throwing a party. O.K., so they are diluting the shares by 20%, they lost almost a quarter of their book value in 14 days. This also equates to almost a quarter of their current market capitalization in 14 days. They’re selling CDOs at 22 cents on the Dollar and financing a good part of the deal. What am I missing? This means what? They get to stay in business maybe 90-180 days? What about all the other CDO holders? What kind of writedowns do they now take because Merrill puked up these CDOs at 22 cents. How much was put down as equity for purchase? Heck, this makes me want to go out and start a shell company. Maybe I could put zero money down and assume some of Merrill’s inventory. Doesn’t sound risky to me. If I can peddle the stuff higher I make some dough, if not my shell company collapses and Merrill can have the goods back.
Now for the best question of all! I went through a rant this morning and my wife asked me what was wrong? I told her all of the above and she asked THE QUESTION. WHO would be stupid enough to buy the new stock? I went speechless……. That is the obvious question!
I didn’t have an answer. I do now though. I was watching CNBC and they said that there were lots of smart people including I think I heard Blackstone or Blackrock group investing in this offering. Yep, yep, yep, smart people! I must be an idiot because I still don’t get it. Merrill reported earnings just 2 weeks ago and didn’t mention anything about these writedowns. Ahhhh, maybe all of this just happened in the last two weeks during the 800 point rally in the Dow.

Here is the central question of all. Doesn’t this basically bankrupt the system? Didn’t these rocket scientist Investment Banks have leverage of 20-30-40 to one? If you include the exotic [notice without the e you can spell toxic] derivatives, some were levered at better than 100 to 1. This is a complete joke! This whole production of Alice in Wonderland would be comical to watch, except for the fact that people across the globe are going to suffer and go bankrupt and hungry. What a travesty! I do have an answer for the central question. Yes, the system has been bankrupted. Only the idiots who use common sense have figured this out. If you are an idiot and use common sense, my suggestion would be to PUT ON YOUR CRASH HELMETS!

]]> By: goldstandard http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1560801 goldstandard Tue, 29 Jul 2008 21:51:49 +0000 http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1560801 <p>Todays market movements were beyond Orwellian. Simplistically, if truth be known, we are talking about bankruptcy stuff as far as many of our financial firms are concerned, so the US government is pulling every maneuver conceivable (bailouts, new mortgage proposals, intervening, etc.) to prevent the implosion from worsening, which is how we got here in the first place. How ironic, that we have a government flapping around rigging markets, who, at the same time, is proposing that US taxpayers spend $500 billion more next year than we will take in … and that is a best case scenario.<br /> Trying to solve problems is understandable, even necessary. However, doing it deceptively is an outrage, which only worsens the problem down the road. Again, they are ruining the free market process. Most egregious is making gold, the barometer of US financial market health, dysfunctional. It is like messing with the thermometer of a fevered patient, fixing it so the temperature of the patient reads normal, instead of letting it elevate to a danger point. As a result, the patient doesn’t realize how sick he is and, therefore, won’t take other measures to prevent disaster or get better.<br /> That is what the Orwellians are doing to the average investor and American public. It is “Dupesville” and is leading us to a nightmare never imagined by the current generation that has forgotten the lesson of the Great Depression.</p> Todays market movements were beyond Orwellian. Simplistically, if truth be known, we are talking about bankruptcy stuff as far as many of our financial firms are concerned, so the US government is pulling every maneuver conceivable (bailouts, new mortgage proposals, intervening, etc.) to prevent the implosion from worsening, which is how we got here in the first place. How ironic, that we have a government flapping around rigging markets, who, at the same time, is proposing that US taxpayers spend $500 billion more next year than we will take in … and that is a best case scenario.
Trying to solve problems is understandable, even necessary. However, doing it deceptively is an outrage, which only worsens the problem down the road. Again, they are ruining the free market process. Most egregious is making gold, the barometer of US financial market health, dysfunctional. It is like messing with the thermometer of a fevered patient, fixing it so the temperature of the patient reads normal, instead of letting it elevate to a danger point. As a result, the patient doesn’t realize how sick he is and, therefore, won’t take other measures to prevent disaster or get better.
That is what the Orwellians are doing to the average investor and American public. It is “Dupesville” and is leading us to a nightmare never imagined by the current generation that has forgotten the lesson of the Great Depression.

]]> By: perris http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1560694 perris Tue, 29 Jul 2008 19:09:14 +0000 http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1560694 <p>I believe as far as the mortgage industry is concerned, it is a pretty simple solution;</p> <p>these industries were selling instruments that were irresponsible and they need to suffer the consequence</p> <p>the solution would be that the institution is PROHIBITED from raising their rates past the inititial offering</p> <p>that is the solution, if they don’t want to carry that loan then they can default it but the homeowner would keep the asset.</p> <p>bing, problem solved</p> I believe as far as the mortgage industry is concerned, it is a pretty simple solution;

these industries were selling instruments that were irresponsible and they need to suffer the consequence

the solution would be that the institution is PROHIBITED from raising their rates past the inititial offering

that is the solution, if they don’t want to carry that loan then they can default it but the homeowner would keep the asset.

bing, problem solved

]]> By: perris http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1560691 perris Tue, 29 Jul 2008 19:06:16 +0000 http://firedoglake.com/2008/07/29/as-merrill-lynch-struggles-to-keep-from-going-blub-wall-street-recoils-from-the-dealy-words-mark-to-market/#comment-1560691 <p>that could be a great post all by itself goldstandard, a very nice read indeed</p> that could be a great post all by itself goldstandard, a very nice read indeed

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