“Quick changes in Mozilo’s trading plan raise red flags, experts say.” — We hope we helped tip them off here. The main point is that the “pre-arranged” share sales plans are undermined by regular changes in the terms of the plan, as in Mozil-oompa’s case. Indeed, it is looking more and more like shareholders were dumpedy-duped: “This raises a slew of red flags,” said Andrew Stoltmann, a Chicago-based securities lawyer. “Anytime you have revisions or modified plans. . . it is extremely suspicious.” Priebe said he advises his clients to set up the agreements several months before they’re used and then try not to deviate from them for years. Thom F. Carroll, a financial planner with the Baltimore wealth management firm Carroll, Frank & Plotkin, said revising such a plan puts an executive “on a slippery slope.” “There are circumstances where the plans could be amended, but you better have a good reason because it’s defeating the basis of the rule,” Carroll said. “If a guy is changing his plan around, I would think that would send up a red flag. I wouldn’t allow my clients to do it.”
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“Essentially, this “second moment shock” as he calls it, will have a potentially far greater impact than the crunch itself in the first three to six months of the affair. (my emphasis)”
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“The wealth effect for housing is about twice as large as for equities, with consumption falling by about two cents in the short run for every $1 decline in home prices”
Goldman Sachs has abandoned its ultra-bullish view of the world economy, warning of a likely recession in Japan and mounting risks that US property slump could spread to parts of Europe. via Budapest Business Journal
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“… cure rates consistently below 60 percent — at least those calculated by MICA — haven’t been seen… pretty much ever.”
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“We see that the deal could potentially be re-priced to $55 to $57 per share as a reasonable range”
Shares of Sallie Mae recovered some ground on Thursday as traders bet that the endangered $25 billion deal to take over the student lender could be renegotiated at a lower price. via Earth Times
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“Such programs allow home sellers to give money to charities, which in turn assist buyers with their down payments. The sellers pay the charities a service fee, but often recoup the money by charging a higher price for the homes, usually 2 or 3 percent more, or an amount equal to the down payment, according to a 2005 study by the Government Accountability Office.” — Another scam dies a long overdue death. Here’s another key part: …the GAO study found that borrowers receiving assistance from the charities were more than twice as likely to default or become delinquent than other FHA borrowers were. In a ruling last year, the IRS went so far as to call the seller-financed programs “scams,” accusing the charities of inflating home prices. Hey look, we just agreed with the IRS on something! Just to be fair here is the counter-argument side: “The rule does discriminate between the haves and the have-nots,” she said. “People who have money from mom and dad or have money on their own are still okay . . . but people who have no access to any sources — those are the have-nots — that group is now going to be discriminated against.” Have-nots or not — putting people in a home they can’t afford does not help the borrower or anyone else. Perhaps the problem of “haves and have-nots” should be solved by more holistic means than simply attempting to bequeath people with houses, to the presumed benefit of creditors and a bevy of other neer-do-wells.
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“Bank credit risk rose amid renewed concern lenders are having difficulty raising funds in the money markets, according to traders of credit-default swaps.” — Sorry, central banks: you can’t just paste this one over with more scotch tape and shoestring.
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Campbell Soup Raised to “Neutral” at Goldman Posted 10:41 AM Campbell Soup Company is up more than 1% in morning trading after scoring an upgrade from “sell” to “neutral” at Goldman Sachs. via SchaeffersResearch.com Daily Market Blog
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This is what happens when the government props up idiots.
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Another day of digestion of Goldman Sachs blowout quarter sheds some light. When the world was running around talking of the “subprime meltdown” and the “freezing of credit markets” Goldman quietly looked at … via Seeking Alpha
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