Ignoramus30183 wrote:
On 2008-07-16, John R. Carroll jcarroll@ubu wrote:
Ignoramus30183 wrote:
On 2008-07-16, Larry Jaques novalidaddress@di wrote:
On Tue, 15 Jul 2008 20:18:57 -0500, with neither quill nor qualm,
Ignoramus19502 quickly quoth:

On 2008-07-15, John R. Carroll jcarroll@ubu wrote:

You know reconditioning well Chudov but apparently not finance.

I have a Master of business administration degree in finance from
University of Chicago. Which is admittedly not that much, but at
least I studied it a little bit.

Well, at least you gave it up for something more real and honest:
hawking wares on eBay and doing new/used metalworking.


That's not my day job,

Well you are very good at it.



Thanks John. I respect your opinions, experience etc. But at the same
time I also think that these GSEs created an enormous market
distortion and should be phased out (at least as "government
sponsored" entities).

The mortgage backed securities industry needs to dissapear. That was the
distortion.
The value of the institutions to society is to great to cast aside and it
shouldn't be.
That doesn't mean I don't believe in castor oil in large doses for the
appropriate parties. It maens that the proper odious "cure" in the
appropriate dossage is in order and soon.


If the value of mortgages decliness further, and if the government
steps in and assumes guarantees given by Freddie and Fannie, this
could potentially expose it to very large liabilities.

The problem with declining values presents a lot less systemic risk that
being unable to properly value or monetize assets.
One of the biggest problems I see right now is that you can't really say
what a lot of the largest financial institutions in the world are actually
worth. It isn't any wonder that investment is grinding to a halt.

--

John R. Carroll
www.machiningsolution.com