Investors in UK bank HBOS have overwhelmingly declined the chance to buy new shares in it. The bank has announced that just 8.29% of the new shares offered in its £4bn rights issue were taken up.
These were the expectations at the weekend:
The Observer wrote:
HBOS, Britain's biggest mortgage provider, will tomorrow reveal that its £4bn rights issue to raise extra capital to cope with the credit crunch has been one of the biggest fund-raising flops in UK corporate history.
If the market turns against HBOS tomorrow, the underwriters and sub-underwriters will be forced to hold on to the stock until they can sell at a profit.
Posted: Mon Jul 21, 2008 11:35 am Post subject: Re: Housing & Economic Collapse - In Progress - #2
I think this is an excellent, excellent article. They are pumping their own newsletter somewhat, but their analysis of the current situation, the dangers we face, as well as the dishonesty at the highest levels is spot on in my opinion. They discuss inflation, the energy situation, unemployment, bank health, the Fed, TPTB, the dollar, and the kitchen sink too.
The one thing I'm surprised about is that they didn't mention PMs.
Posted: Mon Jul 21, 2008 11:59 am Post subject: Re: Housing & Economic Collapse - In Progress - #2
cube wrote:
Remember folks it always trickles down to you.
No Sh**? It may trickle down to us, but it geysers UP to them. The catch all trickle down justification, is somewhat appropriate at certain times. But now? You may as well say being shaken down by a protection racket is good for all of us in the long run.
NEW YORK, July 21 (Reuters) - The cost to insure the debt of Countrywide Financial Corp’s home loan unit rose on Monday after Bank of America Corp’s chief financial officer said the bank doesn’t intend to guarantee Countrywide’s debt.
Joined: Dec 07, 2005 Posts: 1812 Location: Australia
Posted: Mon Jul 21, 2008 6:55 pm Post subject: Re: Housing & Economic Collapse - In Progress - #2
This sounds pretty bad;
Quote:
More strange doings tonight surrounding the failure and federal takeover of IndyMac: some rival banks are refusing to honor cashier's checks written by IndyMac -- even though those checks are backed by the federal government.
John Bovenzi, the FDIC official now running IndyMac, tells the Los Angeles Times today he is "deeply troubled by reports that there are financial institutions that are refusing to honor or are placing excessive holds on IndyMac Federal checks."
To all; the recent news that Wells Fargo and Washington Mutual are not accepting Indy Mac/FDIC checks is beyond belief. These actions carry ramifications that could not appear in a sci-fi movie. Are we to believe that 2 major US banks do not trust the federal government? If this policy is not reversed almost immediately, then the fuse is lit.
This is, as far as I know the first time [other than dishoarding of $s] that the credit quality of the US government has come into question other than in the CDS markets. 8 weeks to clear a check? Third world countries clear US personal checks in 30 days! If this goes unchecked, how long will it be before the entire system refuses checks and accepts only Fed fund wire transfers? The epileptic siezures in the credit markets was like oil pouring out of the engine. Failure to accept/clear FDIC checks is akin to shoving a lit rag into the gas tank. They both have the same results more or less, only one explodes much faster and will even melt the tires to the ground.
Indy Mac's failure will consume between 7-14% of FDIC's current available funds. A run on two or three midsized banks will use over half of what is remaining. Bottom line, the Fed will try to create Dollars upon Dollars to bail out everything. I don't think they can create Dollars fast enough or in sufficient quantity to keep banks and markets open. I do however think that in their failure to "save the system", they will destroy the international value of the Dollar. Possibly overnight. The ultimate bank run will not be Citigroup, Bank America, or Wells Fargo. It will be foreigners "standing in line" to get their Dollars out. It will be the failure of confidence in the US govenment. When US checks can no longer be cleared overseas, those banking systems will then have been dragged into the banking abyss with us. This is global.
_________________ Lets take a ride, and run with the dogs tonight
In suburbia
You cant hide, run with the dogs tonight
In suburbia
- Pet Shop Boys
Joined: Dec 07, 2005 Posts: 1812 Location: Australia
Posted: Mon Jul 21, 2008 7:18 pm Post subject: Re: Housing & Economic Collapse - In Progress - #2
More Goldman Sachs people to helpout in the treasury.
No other company has as many ex-staff in the treasury and key-government financial positions.
GS even intends to help-out free of charge with providing free consultancy to the treasury in form of it's most senior M&A expert, Ken Wilson.
Well there is no such thing as a free lunch. GS obviously get something out of these type of arrangements.
theDeal _________________ Lets take a ride, and run with the dogs tonight
In suburbia
You cant hide, run with the dogs tonight
In suburbia
- Pet Shop Boys
Last edited by Micki on Tue Jul 22, 2008 12:16 am; edited 1 time in total
Posted: Tue Jul 22, 2008 12:13 am Post subject: Re: Housing & Economic Collapse - In Progress - #2
Oh, I missed that one, but it is related:
Quote:
OTTAWA, July 21 (Reuters) - The Bank of Canada injected C$775 million into markets on Monday, the first such operation in more than a month, to lower the overnight interest rate toward the central bank's target and improve liquidity.
Funny that, not a few days before, first the Finance Minister went on record saying "all is well in the Great White North" only to (sorta kinda) have the BoC President fall into his back the next day saying that some "uncertain times" are ahead. Followed by dumping more paper money onto the market.
Damn.... Couldn't that have waited two years? *sigh*
Joined: Apr 12, 2007 Posts: 1165 Location: Central NC
Posted: Tue Jul 22, 2008 7:07 am Post subject: Re: Housing & Economic Collapse - In Progress - #2
Wachovia has $8.9B loss, cuts 6,350 jobs, dividend
Tuesday July 22, 8:39 am ET
By Ieva M. Augstums, AP Business Writer
Wachovia slashes dividend, jobs, to shut mortgage unit after $8.86B loss in second quarter
CHARLOTTE, N.C. (AP) -- Wachovia Corp. lost $8.86 billion in the second quarter, and said Tuesday it was slashing its dividend and cutting 6,350 jobs after losses tied to mortgages soared.
Even excluding one-time items, the results substantially missed Wall Street estimates, and shares sank to mid-1991 levels in premarket trading.
Now, as an average uninformed person would you keep your money in this bank? Is it to much work to walk in close the account, take the bank check across the street and open a new account? _________________ "The era of procrastination, of half-measures, of soothing and baffling expedients, of delays, is coming to a close. In its place we are entering a period of consequences…"
Sir Winston Churchill
Posted: Tue Jul 22, 2008 12:16 pm Post subject: Re: Housing & Economic Collapse - In Progress - #2
I am taking this report with a rather large grain of salt, but lemetropolecafe.com has been pretty dependable over time. If anyone else has info on this, please post it.
Quote:
FDIC checks
To all; the recent news that Wells Fargo and Washington Mutual are not accepting Indy Mac/FDIC checks is beyond belief. These actions carry ramifications that could not appear in a sci-fi movie. Are we to believe that 2 major US banks do not trust the federal government? If this policy is not reversed almost immediately, then the fuse is lit. This is, as far as I know the first time [other than dishoarding of $s] that the credit quality of the US government has come into question other than in the CDS markets. 8 weeks to clear a check? Third world countries clear US personal checks in 30 days! If this goes unchecked, how long will it be before the entire system refuses checks and accepts only Fed fund wire transfers? The epileptic siezures in the credit markets was like oil pouring out of the engine. Failure to accept/clear FDIC checks is akin to shoving a lit rag into the gas tank. They both have the same results more or less, only one explodes much faster and will even melt the tires to the ground.
Indy Mac's failure will consume between 7-14% of FDIC's current available funds. A run on two or three midsized banks will use over half of what is remaining. Bottom line, the Fed will try to create Dollars upon Dollars to bail out everything. I don't think they can create Dollars fast enough or in sufficient quantity to keep banks and markets open. I do however think that in their failure to "save the system", they will destroy the international value of the Dollar. Possibly overnight. The ultimate bank run will not be Citigroup, Bank America, or Wells Fargo. It will be foreigners "standing in line" to get their Dollars out. It will be the failure of confidence in the US govenment. When US checks can no longer be cleared overseas, those banking systems will then have been dragged into the banking abyss with us. This is global.
The simplest solution to all of this is to add a minimum of 3 zeros to the price of Gold. That puts 1000 times more capital into central bank coffers. Those that still have their Gold. Regards, Bill H.
SNIP
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Posted: Tue Jul 22, 2008 12:31 pm Post subject: Re: Housing & Economic Collapse - In Progress - #2
I read something about that last week, and it was not on lemtropolecafe. I'll try and find it again. It may have been on tickerforum.com, but I'll check.
It appears to me that banks may start eating their own in an attempt to survive and also out of pure distrust. The news that Bank of America does not intend to guarantee Countrywide's $95 billion of debt which it supposedly assumed in its purchase of Countrywide, and now this news, seems as though all bets are off. They certainly don't seem to trust each other, and why should they when every word that comes from a bank these days is basically a bald faced lie? The phrase "we are well-capitalized", which should be reassuring, is the new kiss of death.
Posted: Tue Jul 22, 2008 1:01 pm Post subject: Re: Housing & Economic Collapse - In Progress - #2
Homesteader wrote:
Wachovia has $8.9B loss, cuts 6,350 jobs, dividend
Tuesday July 22, 8:39 am ET
By Ieva M. Augstums, AP Business Writer
Wachovia slashes dividend, jobs, to shut mortgage unit after $8.86B loss in second quarter
CHARLOTTE, N.C. (AP) -- Wachovia Corp. lost $8.86 billion in the second quarter, and said Tuesday it was slashing its dividend and cutting 6,350 jobs after losses tied to mortgages soared.
Even excluding one-time items, the results substantially missed Wall Street estimates, and shares sank to mid-1991 levels in premarket trading.
Now, as an average uninformed person would you keep your money in this bank? Is it to much work to walk in close the account, take the bank check across the street and open a new account?
and yet the stock bounces up on that news. these guys are killing me... the disconnect from reality is actually starting to get funny.
Posted: Tue Jul 22, 2008 2:51 pm Post subject: Re: Housing & Economic Collapse - In Progress - #2
I think the delays in processing cheques are not due to a lack of confidence in the issuer, but a lack of confidence in the bearer. Concern about counterfeits is likely to be legitimate. And it is common knowledge that banks like to make a few days' interest at their customers' expense. The security concern could give unscrupulous managers an excuse to draw that out even further than normal. I think there is no systemic confidence issue here. Those banks are desperate for money. _________________ "The American people are watching the numbers climb higher and higher at the pump and they're waiting to see what the Congress will do." - George W Bush
Experts Say The Nation's Financial Straits Will Get Worse, And There Is No Consensus On What To Do About It
Quote:
In fact, the economy is still showing small signs of growth. But Matt Weisbrott says that with inflation up and wages down, that's little comfort:
"It's kind of like the guy who jumps out the window of a 60-story building, and he passes the 30th floor and he says, 'Everything's okay, so far.'"
Quote:
"Does anybody really have an answer for fixing the economy," Braver asked, "or is it all just a little bit of guess work? And maybe it'll take some luck?"
"It is probably much more the latter," Cashin said. "I'm afraid that it's Thanksgiving. They are all in the kitchen and there are no measuring cups. It's a little bit of this and little bit of that, so without the measuring cups, we're making it up as we go along."
Chaos will continue to reign. No leaders will emerge to show us the way out of this. All options are bad. _________________ "Thank you for attending the oil age. We're going to scrape what we can out of these tar pits in Alberta and then shut down the machines and turn out the lights. Goodnight." - seldom_seen
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