"thunder" wrote in message
...
On Tue, 10 Feb 2009 16:32:54 -0500, Eisboch wrote:


Good job. You just identified the problem. The solution is not to
fundamentally change the basis of our form of government or economy.

I'm not calling to fundamentally change our form of government or
economy, yet. But if this spirals out of control, and we end up with
breadlines, I might. Something is fundamentally flawed when a few fat
cats can bring down the world's economy. Business cycles are one thing,
market crashes are another.



It is a very serious aberration. If we can survive the ramifications and
correct the loopholes that allowed them, we will be ok.

It's not time to over-react or allow those with a different agenda to
control our destiny.

We need to take our lumps, fix the problem and get on with it.

Eisboch

On Tue, 10 Feb 2009 15:44:05 -0600, thunder
wrote:

Something is fundamentally flawed when a few fat
cats can bring down the world's economy.

It was more than a few. The problem became systemic and very wide
spread. Half of the people in south Florida, ordinary people for the
most part, were either involved in real estate speculation or helping
to facilitate it in some way. It was a lot of fun while the party
lasted and no one was complaining.

"Wayne.B" wrote in message
...
On Tue, 10 Feb 2009 15:44:05 -0600, thunder
wrote:

Something is fundamentally flawed when a few fat
cats can bring down the world's economy.

It was more than a few. The problem became systemic and very wide
spread. Half of the people in south Florida, ordinary people for the
most part, were either involved in real estate speculation or helping
to facilitate it in some way. It was a lot of fun while the party
lasted and no one was complaining.


When we bought the first house in Jupiter one of my native neighbors tried
to get me into speculative investing. This was just before the end of the
explosion of house values. He was living high off the hog flipping houses
but was maxed out on his bank's willingness to extend further credit. He
wanted me to fund some additional investments, promising huge returns.

Being the conservative and economically stupid person I am, I passed. Good
thing. In less than a year the housing market crashed and he was stuck
upside down in several investments.

Eisboch

On Tue, 10 Feb 2009 17:24:03 -0500, "Eisboch"
wrote:

Being the conservative and economically stupid person I am, I passed. Good
thing. In less than a year the housing market crashed and he was stuck
upside down in several investments.

Did I ever tell you about my broker who wanted me to join a CDO hedge
fund in 2004?

So I looked through the prospectus, lot of legal mumbo jumbo and then
the numbers - I'm pretty good with numbers - they were talking 20 to 1
leverage factors with returns in the 15/20% range per annum.

37 pages of agreements on packaging the security, monies obtained,
leverages/averages and every other type of X-ages you can name.

Something didn't look right, so I got out the old scientific
calculator and made my own calculations based on their assumptions
over time.

It never came out the same twice. In theory, one parameter change
shouldn't affect all other parameters to the extend I was finding to
be true.

The upshot was while they were claiming 20 to 1, it was closer to 30
to 1 - it was the only way the math would work they way they claimed.

No freakin' wonder we got into that mortgage mess.

--

If we aren't supposed to eat animals,
why are they made of meat?

On Tue, 10 Feb 2009 16:52:19 -0500, Eisboch wrote:


It is a very serious aberration. If we can survive the ramifications
and correct the loopholes that allowed them, we will be ok.

Oh we'll be OK. One thing I have learned about this country, it is
incredibly resilient.


It's not time to over-react or allow those with a different agenda to
control our destiny.

We need to take our lumps, fix the problem and get on with it.

Yeah but, that's a tough sell to the 1/2 million people who lost their
jobs last month. Their lumps are considerably bigger than our lumps.

On Tue, 10 Feb 2009 17:24:03 -0500, Eisboch wrote:


When we bought the first house in Jupiter one of my native neighbors
tried to get me into speculative investing. This was just before the end
of the explosion of house values. He was living high off the hog
flipping houses but was maxed out on his bank's willingness to extend
further credit. He wanted me to fund some additional investments,
promising huge returns.

Sounds like a responsible banker, that I'm guessing is still in
business. Back in the late '80s, there was a builder I did some work
with. Anyway, he wanted to build a few houses, but the market was
getting quite tight. He went to over thirty banks trying to get a loan.
They all rejected him. I kept telling him, that maybe they were telling
him something, and he should listen. But being stubborn, he persisted
until he found one that was willing. He crashed and burned.


Being the conservative and economically stupid person I am, I passed.
Good thing. In less than a year the housing market crashed and he was
stuck upside down in several investments.

Eisboch

On Feb 11, 3:55*am, thunder wrote:
On Tue, 10 Feb 2009 16:52:19 -0500, Eisboch wrote:
It is a very serious aberration. *If we can survive the ramifications
and correct the loopholes that allowed them, we will be ok.

Oh we'll be OK. *One thing I have learned about this country, it is
incredibly resilient. *

It's not time to over-react or allow those with a different agenda to
control our destiny.

We need to take our lumps, fix the problem and get on with it.

Yeah but, that's a tough sell to the 1/2 million people who lost their
jobs last month. *Their lumps are considerably bigger than our lumps.

Yeah, I don't think we can afford to just sit around and do NOTHING.

On Tue, 10 Feb 2009 23:18:15 GMT, Zombie of Woodstock
wrote:

Did I ever tell you about my broker who wanted me to join a CDO hedge
fund in 2004?

So I looked through the prospectus, lot of legal mumbo jumbo and then
the numbers - I'm pretty good with numbers - they were talking 20 to 1
leverage factors with returns in the 15/20% range per annum.

37 pages of agreements on packaging the security, monies obtained,
leverages/averages and every other type of X-ages you can name.

Something didn't look right, so I got out the old scientific
calculator and made my own calculations based on their assumptions
over time.

It never came out the same twice. In theory, one parameter change
shouldn't affect all other parameters to the extend I was finding to
be true.

The upshot was while they were claiming 20 to 1, it was closer to 30
to 1 - it was the only way the math would work they way they claimed.

No freakin' wonder we got into that mortgage mess.


One of Warren Buffet's favorite sayings is to never invest in anything
that can not be easily understood.

wrote in message
...
On Feb 11, 3:55 am, thunder wrote:
On Tue, 10 Feb 2009 16:52:19 -0500, Eisboch wrote:
It is a very serious aberration. If we can survive the ramifications
and correct the loopholes that allowed them, we will be ok.

Oh we'll be OK. One thing I have learned about this country, it is
incredibly resilient.

It's not time to over-react or allow those with a different agenda to
control our destiny.

We need to take our lumps, fix the problem and get on with it.

Yeah but, that's a tough sell to the 1/2 million people who lost their
jobs last month. Their lumps are considerably bigger than our lumps.

Yeah, I don't think we can afford to just sit around and do NOTHING.

Nothing is better than the wrong thing.

On Feb 11, 11:48*am, "Calif Bill" wrote:
wrote in message

...
On Feb 11, 3:55 am, thunder wrote:

On Tue, 10 Feb 2009 16:52:19 -0500, Eisboch wrote:
It is a very serious aberration. If we can survive the ramifications
and correct the loopholes that allowed them, we will be ok.

Oh we'll be OK. One thing I have learned about this country, it is
incredibly resilient.

It's not time to over-react or allow those with a different agenda to
control our destiny.

We need to take our lumps, fix the problem and get on with it.

Yeah but, that's a tough sell to the 1/2 million people who lost their
jobs last month. Their lumps are considerably bigger than our lumps.

Yeah, I don't think we can afford to just sit around and do NOTHING.

Nothing is better than the wrong thing.

But what if nothing IS the wrong thing?