GLG News by Asset Backed Securities Experts

Joseph SmithPresident and CEODefault Mitigation Management

What to expect from the bailout.

September 12, 2008

Analysis of:U.S. bails out Fannie Mae, Freddie Mac, ousts CEOs | www.bizjournals.com

1. Shows how truly bad the mortgage industry has gotten and how scared the feds are of where we are going. 2. If the major source of liquidity can not survive, who will? 3. What should be the outcome.

John SalomoneManaging DirectorStructured Finance International, LLC

Factor In Reality

August 18, 2008

Analysis of:Bank Debt Risk Rises as Writedowns, Losses Exceed $500 Billion | www.bloomberg.com

Write downs are not actual losses and a mark-to-market loss is not a cash loss. Widening spreads in the credit default market, although real, must be recognized for what they are; namely, market monetization of perceived risks compared to recent backwards looking asset and cash flow valuations. Recovery in the general credit market should produce non-cash reported earnings increases starting in 2009 and similar narrowing of the exact credit default spreads that widened recently.

Maureen BoltonPrincipalGlobal Capital Access

Will Government's Promotion of Covered Bonds as Mortgage Funding Mechanisms Bring Back Investors to US Mortgage Market?

July 30, 2008

Analysis of:Treasury and Banks Kick Start Home Financing Tool | www.reuters.com

This article is important because it announces and describes: a) the US Treasury's support of covered bonds, an on-balance sheet method of funding mortgage originations, as an alternative to off-balance sheet mortgage securitizations or mbs b) Four major US banks announcements of their intentions to bring covered bond issues to market in the near future and and their commitment to provide pricing information in order to facilitate the trading of covered bonds and c) the FDIC's support of a covered bond market and its policy statement describing how it would treat covered bond investors in the event that an issuing bank become insolvent. The government and market participant actions described in the article are remarkable because they appear to contemplate an on-going involvement of the US Treasury and FDIC in the funding of mortgages that is more hands-on than any such actions to date, creating a defacto US govt gtd covered bond market.

Joseph SmithPresident and CEODefault Mitigation Management

UBS Pain far from Over

May 28, 2008

Analysis of:UBS Falls After Saying More Mortgage Losses Possible | www.bloomberg.com

The news is not good for UBS. The amount of mortgage holdings in US and Non-US declining markets will lead to further losses. 1. $45 B of additional US Mortgage Holdings. 2. An undisclosed amount of non-US mortgage holdings. 3. A UK and Eurpoean mortgage market that is going down as well. 4. The slump in home prices is not over and is impacting performing mortgages. 

Joseph SmithPresident and CEODefault Mitigation Management

The Real Write Downs - Whats in a number

May 27, 2008

Analysis of:Banks Keep $35 Billion Markdown Off Income Statements | www.bloomberg.com

The article is right on target in pointing out the various issues around bank reporting their losses todate. 1. Allowable accounting standards. 2. Permanent versus Temporary Losses 3. Capital Requirments The article goes on to highlight the various issues around soveriegn wealth funds, capital levels and loan leverage. The article ends with a list of "hidden losses" by various financial institutions. The interesting part of the article is the acknowledgement of an additional $35 B to be taken by the banks. The bigger issue is the losses to be taken by the investors.

Joseph SmithPresident and CEODefault Mitigation Management

Whose loss is it, Banks or Investors?

May 12, 2008

Analysis of:The Biggest Housing Losers | online.wsj.com

1. While the article does a good job of pointing out that the losses will be greater under the House FHA Plan than expected and that the tax payers will carry the cost, it along with the plan by the House  misses the mark by thinking banks will take advantage of the plan. 2. The real owners of these loans are the investors, not the banks. 3. The investors are already not doing short sales, why would they take 40 and 50% losses under this plan.

John SalomoneManaging DirectorStructured Finance International, LLC

Deeper Analysis Required - Stability Likely

April 14, 2008

Analysis of:Hotels Most Vulnerable to Recession Scenario | nreionline.com

On the surface, statements seem valid and perhaps are for individual properties and new construction plans. The structured financings inside management contracts and leases provide relatively stable cash flow for the real property owners and lenders that are the underlying financiers of the hotel industry. Hotel management companies that are the "Names" on the hotel will suffer reduced net income, but flat or slightly shrinking GDP should not cause major hotel real estate defaults. There are even one or two new hotel "Names" entering the U.S. market.

Joseph SmithPresident and CEODefault Mitigation Management

Fannie, Freddie and FHLB's are providing funding for now.

April 10, 2008

Analysis of:Fannie and Freddie drive home loans | www.ft.com

Through mid 2008 these will continue to be the drivers of home loan financing. Coming up quickly will be HUD/FHA. The unkown related player will be community banks, credit unions and small regionals. There is a problem that is already surfacing, add on fees by the banks using these groups for funding.

Joseph SmithPresident and CEODefault Mitigation Management

Be Careful What you ask for you might get it.

April 4, 2008

Analysis of:Overdue Consumer Debts Highest Since 1992, ABA Says | www.bloomberg.com

It looks like the legislative solution is not getting off the ground again as far as working out loans. The proposals that have come out are mainly directed at going forward purchasers, builders and cities. So much for the defualted borrower. The ideas that were being floated carried their own risk.

Joseph SmithPresident and CEODefault Mitigation Management

Expect to see more suits and bigger failures

March 24, 2008

Analysis of:Merrill Sues XL Capital to Maintain CDO Insurance | www.bloomberg.com

The article raises valid concerns on security of these insured transactions. Expect: 1. More suits as the insurers try legal tactics to invalidate coverage. 2. That the contracts and premiums have been paid and the courts will likely take a dim view of legal ploys to invalidate coverage based on semantics. 3. That the additional capital that has been raised by the monolines is still not sufficient to cover all of their risk.

Previous Page : 123456789Next21 to 30 of 81