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).
Sheeple the First!
ReplyDeleteDuh! Bears. Lady sheep never stand on their hind legs and we all know why.
ReplyDeleteWhy 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?
ReplyDeleteNR
Ouch, that hurts. Mu(r)st suck to be holding that bag...
ReplyDeleteThe investment banks stand quite close to the printing presses. They can't lose. Watch and see if this mess doesn't magically go away.
ReplyDeleteSide note: Jim Cramer just dissed Jamba Juice (JMBA).
ReplyDeleteLOL
How long before this derivatives debacle spills over into people's pension plans. Especially those holding REITs.
ReplyDeleteThat is crazy! But even risky home loans aren't 100% in default (yet). How - why - huh ?
ReplyDeleteThese plunged that much since the end of April?
Yikes.
Leverage and subject to redemption are what killed them. If you are 10x leveraged and get a 10% default you are tapped out.
ReplyDeleteDat's a Gary Larson cartoon, if my details guy grade memory serves me correctly.
ReplyDeleteHo Ho Ho - It's Santa Flipper Clause
ReplyDeleteIt 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
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.
ReplyDeleteLeverage and subject to redemption are what killed them. If you are 10x leveraged and get a 10% default you are tapped out.
ReplyDeleteAh, that makes sense.
*poof*
ReplyDeleteWell. At least a bunch of morons got to enjoy living in nice houses for a year or so.
Ho Ho Ho - It's Santa Flipper Clause
ReplyDeleteSophisticated 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
So Bear said they have only "settled" $200M of the $1.8B bailout. Is the bailout for the screwed investors? 'splain!
ReplyDelete"...the brokerage has told the funds' investors that the portfolios' assets are almost worthless, according to people familiar with the matter."
ReplyDeletebut...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.
But first, wrap their telephone cords around their scrota or mammaries, and jam the telephone sets under their desks.
ReplyDeleteI can think of a better place for the Wall Street grifters to jam the telephone sets.
https://www.tdnam.com/trpItemListing.aspx?&miid=7719233
ReplyDeletesecond 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
@fort 6:03p
ReplyDeleteit 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.
actually its a simple excel formula
ReplyDeleteA1=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!
oh yeah pleather murse it will become a negative number where i would pay the buyer
ReplyDeleteit 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?!??!
@ 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
ReplyDeleteI'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 :-)
Starting at $5,000, reducing 10% per day, it will take 104 days to reach a penny.
ReplyDeleteHowever, like fort said, it can never, ever, ever go negative.
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.
ReplyDeleteI need to move to another planet.
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)
ReplyDeleteAlso, I left my financial calculator in my other murse, the koi-skin one.
ReplyDeleteCHC?
ReplyDeletePlease translate to URL. Have been hiding under rock lately.
Chuck Ponzi
CHC?
ReplyDeletecaseyhaterz.com
Forums; moderated; registration required; some like it, some don't.
Bear Stearns to Hedge Fund Investors:
ReplyDeleteNO DEAL!!
aaaaack!!
S_t_C
Not to be koi but the shark has jumped the murse and flown to Phoenix. New post IAFF
ReplyDeleteOn 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.
I think Bear Stearns is bluffing... I'll look into it.
ReplyDeleteI gotta second Walt - Benoit, I enjoy your posts as well.
ReplyDeleteDon'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.
You have to hand it to Casey, he's consistent.
ReplyDeleteNo 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 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.
ReplyDeleteOn 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?
aaack!!
ReplyDeleteHA-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!
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.
ReplyDeleteRight?
Right!
ReplyDelete[Memo from Bear Stearns High-Grade Structured Credit Strategies Enhanced Leverage Fund, to: Investors and Creditors]
ReplyDeleteAfter 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!
The one to watch will be Moodys and other investment raters.
ReplyDeleteThey 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
I wouldn't get too upset if Cramer disses one of your stocks, here's his performance: www.stockTagger.com
ReplyDelete