Tuesday, July 17, 2007

Worth Less Than Fliptard

WSJ Online reports that Bear Stearns has informed investors of some bad news.

Two Bear Funds Nearly Worthless,Investors Told
By KATE KELLY and SERENA NG July 17, 2007 5:30 p.m.
Weeks after the meltdown of two prominent Bear Stearns Cos. hedge funds that bet heavily on the market for risky home loans, the brokerage has told the funds' investors that the portfolios' assets are almost worthless, according to people familiar with the matter.

The assets in Bear's more-levered fund, the High-Grade Structured Credit Strategies Enhanced Leverage Fund, are worth virtually nothing, according to people familiar with the matter. The assets in the larger, less-levered fund are worth roughly 9% of the value since the end of April, these people said.

I've often talked about at least $7 trillion wit a "T" dollars needing to evaporate. These are hardly a down payment. I think I dropped my popcorn.

Side note: Jim Cramer just dissed Jamba Juice (JMBA).

41 comments:

wagga said...

Sheeple the First!

wagga said...

Duh! Bears. Lady sheep never stand on their hind legs and we all know why.

Northern Renter said...

Why do I suddenly hear a hundred thousand heretofore silent voices suddenly urging on LostMittens and anyone else who's putting a thumping to a specuvestor?


NR

Property Flopper said...

Ouch, that hurts. Mu(r)st suck to be holding that bag...

Anonymous said...

The investment banks stand quite close to the printing presses. They can't lose. Watch and see if this mess doesn't magically go away.

Sprezzatura said...

Side note: Jim Cramer just dissed Jamba Juice (JMBA).

LOL

Unknown said...

How long before this derivatives debacle spills over into people's pension plans. Especially those holding REITs.

mejustme said...

That is crazy! But even risky home loans aren't 100% in default (yet). How - why - huh ?

These plunged that much since the end of April?

Yikes.

Rob Dawg said...

Leverage and subject to redemption are what killed them. If you are 10x leveraged and get a 10% default you are tapped out.

NoDebtWhatSoEver™ said...

Dat's a Gary Larson cartoon, if my details guy grade memory serves me correctly.

Santa Flipper Clause said...

Ho Ho Ho - It's Santa Flipper Clause

It is my undertanding that they were offered 5 cents per "dollar" of assets. They were trying to hold out for 11 cents.

Santa F. Clause

Rob Dawg said...

The unbelievable "everybody stay calm" moment came when the experts were saying that these were sophisticated investors who are well able to accept and handle these losses.

mejustme said...

Leverage and subject to redemption are what killed them. If you are 10x leveraged and get a 10% default you are tapped out.

Ah, that makes sense.

Unknown said...

*poof*



Well. At least a bunch of morons got to enjoy living in nice houses for a year or so.

Santa Flipper Clause said...

Ho Ho Ho - It's Santa Flipper Clause

Sophisticated Santa's ass. No investor is going to readily agree to a 95 percent loss.

OK - maybe one investor we all know, but not many others.

Santa F. Clause

ratlab said...

So Bear said they have only "settled" $200M of the $1.8B bailout. Is the bailout for the screwed investors? 'splain!

Bilgeman said...

"...the brokerage has told the funds' investors that the portfolios' assets are almost worthless, according to people familiar with the matter."

but...but...but

It was the "High-Grade Structured Credit Strategies Enhanced Leverage Fund".

How can it be worth nothing if it was "High-Grade"?

One shudders at what the Mid-Grade and Low-Grade are now worth.

Stockbroker and Fund Manager Manhattan Sidewalk Impact Test, anyone?

But first, wrap their telephone cords around their scrota or mammaries, and jam the telephone sets under their desks.

Anonymous said...

But first, wrap their telephone cords around their scrota or mammaries, and jam the telephone sets under their desks.

I can think of a better place for the Wall Street grifters to jam the telephone sets.

Unknown said...

https://www.tdnam.com/trpItemListing.aspx?&miid=7719233

second price 10% drop in a day!

in honor of all the fallen hedge funds and those domain squatters banking on a payday!

domainsale of iamfacingbankruptcy.com
has lost a whopping 90% of its value since original listing price of $5000.

it will keep chopping & dropping 10% a day in tribute to my fallen brothers in the domain name market

Pleather Murse said...

@fort 6:03p

it will keep chopping & dropping 10% a day in tribute to my fallen brothers in the domain name market

Great, I'll just wait 10 days and get the fucker for free.

Though since there's 68 days left in the auction I could just wait till it's over when you will actually PAY me whatever a 10% drop per day over 68 days comes to.

Unknown said...

actually its a simple excel formula

A1=450

formula is =a1*.9 drag it down the sheet and it takes about 59 more days to get to 99 cents!!!

in 68 days its thirty eight cents

after 100 days it hits one and onethird cents


in your face CASEY! thats one and one third cents more than you in sweet passive income!

Unknown said...

oh yeah pleather murse it will become a negative number where i would pay the buyer

it will only become fractions of one cent to infinity, but never reach zero, get it???

simple math, and im a dropout product of nyc public schools

sheesh, remember casey's raffle math?!??!

Unknown said...

@ walt526, earlier thread -- There are a couple of posters that I wish would return, like Benoit, but the decreased posting volume makes it easier to stay current

I'm still here, I try to read all the threads at the end of each day. Honestly, staying current with CHC and EN alone takes a serious chunk of time.

I appreciate the compliment :-)

Unknown said...

Starting at $5,000, reducing 10% per day, it will take 104 days to reach a penny.

However, like fort said, it can never, ever, ever go negative.

Akubi said...

I like the Sheep Man on the missing floor, but I would like to reiterate the fact that this is f-ing nauseating as hell propaganda.
I need to move to another planet.

Pleather Murse said...

Stupid math. Anyway, I'm not a detail person, I like to look at the big picture which is what successful posters do. And I hadn't had my usual shot of crabgrass juice at the time so my brain wasn't working up to its usual high double-digit IQ potential. It's all not bad! (tm)

Pleather Murse said...

Also, I left my financial calculator in my other murse, the koi-skin one.

Chuck Ponzi said...

CHC?

Please translate to URL. Have been hiding under rock lately.

Chuck Ponzi

lawnmower man said...

CHC?

caseyhaterz.com

Forums; moderated; registration required; some like it, some don't.

Sputnik_the_Cat said...

Bear Stearns to Hedge Fund Investors:

NO DEAL!!

aaaaack!!

S_t_C

Phil in Freeport said...

Not to be koi but the shark has jumped the murse and flown to Phoenix. New post IAFF

On the job front - I’m in Phoenix area for a night to check out an opportunity. No, I am not paying for the trip. Offered by one of my advertisers. May or may not require relocation. Will see. Still talking. Progress!

Will be back in time to retain an attorney to put a stop to the circus.

Probably be the last trip before I go away. I’m gonna miss traveling and talking about it here.

That boi gets around.

Tesla said...

I think Bear Stearns is bluffing... I'll look into it.

Caseys Sex Life said...

I gotta second Walt - Benoit, I enjoy your posts as well.

Don't go

Please Don't Go

Don't Goo AWAYYYY

I am singing as I am writing - is it too early to start drinking? Let the party begin!

What, people are expecting paychecks this week? I am supposed to make sure this happens? I gotta be responsible? This sucks.

The Landlord said...

You have to hand it to Casey, he's consistent.

No matter what is happeneing around him he sticks by his principles:

1) See everything as an opportunity
2) Travel
3) Sign everything
3) Disregard the results of #3

I'd hope that he's going to Phoenix to interview for a salaried web position. But I highly suspect that it'll be some other commision-based, MLM type situation.

The saying is true: The more things change, the more they stay the same.

The Landlord said...

The odd thing is that there's a fierce balance with the accredited investors. On one side we see a hedge fund fail (and therefore some pensions lose money) and if John and Jane Smith had their money in it they'd be belly-up now and crying.

On the other hand, when these funds are doing well, john and Jane rant about how unfair it is to only let the rich into the exclusive playground. It's a government regulation that's just making the rich richer!

How do you fix this? Do you forbid the use of any derivatives? Do you tighten the reigns on accredited investing (funds can't invest unless the entire pool of money comes from accredited investors)? Do you forbid any speculation on the market?

Sputnik_the_Cat said...

aaack!!

HA-HA! Casey's last comment post at the end of the ATTACK! thread ... he refers to LossMitPunk as the "CIRCUS MONKEY".

Priceless!

Quality entertainment...

thpptt!!

S_t_C

PS - Tesla: LOL!

Peripheral Visionary said...

Well, OK, so a couple of hedge funds collapsed. Some rich people lost a lot of money. And maybe a pension plan or two. But that's the limit of the damage, don't worry, it's contained™. It's not as if the investment banks lent the hedge funds huge amounts of money, like, say, billions, that they might not get back after the run on the hedge funds' assets; it's not like the CDOs held by the funds are going to be sold at fire sale prices which will trigger massive margin calls at other hedge funds. Don't worry, no contagion here.

Right?

Waiting to Die said...

Right!

Peripheral Visionary said...

[Memo from Bear Stearns High-Grade Structured Credit Strategies Enhanced Leverage Fund, to: Investors and Creditors]

After sleeping on this whole thing and seeing how the market commentators continue to break our trust and STILL talk crap about us in public and interfering in our transactions, even after they told us they would stop . . . our decision is as follows:

We are canceling all agreements we’ve ever had with you about our assets or “debts” [which were really not intended to be repaid (but we'll explain that later)] or anything else any of you may be expecting from us. WE’RE OUT!

H Simpson said...

The one to watch will be Moodys and other investment raters.

They are currently whining that even though they are paid, their rating do not amount to crap. But investors make decisions on their advice.

Same pass the blame KMPG and several other of the big 7 did earlier in the decade when it came to the fact they did not notice the books were cooked.

You can be sure the AGs from the states that had pension funds invested are going to spend lots of govt time & money to recoup their loss via insurance claims and tort suits on the raters.

H

eattherich said...

I wouldn't get too upset if Cramer disses one of your stocks, here's his performance: www.stockTagger.com