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May Stock Talk II

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Veteran
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Posted: #1
I can't let a day go by without any commentary in here. 
 
I was not expecting the rally today, but we still fell short of closing above some important levels.  DOW bounced off of 12900, Nasdaq bounced off of 2490, and S&P didn't make it to 1405. 
 
I was expecting a down day after the FedEx news, AIG downgrade, and the MBIA news.  but, alas, terrible news is fantastic. 
 
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Posted: #2
Market still trading range bound, chart doesnt look bullish to me, rather meandering with no trend in any direction.

Gunners, this is why MBI wasnt down today, and makes me want to go buy some myself- (CEO speaking on this piece)

MBIA continues to be a sound financial institution," he said in a statement. "We have ample liquidity, our balance sheet is built to withstand credit stress levels many multiples of what we're experiencing now, and our business model is proving that we are adequately capitalized to satisfy any potential claims on our insured portfolio."
 
Legend
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Posted: #3
Tbsi,Exm, Drys on fire.  Love these Dry Bulk stocks once again.  Tbsi might fall a bit today.
Gonna buy into Tbsi on a dip today.
 
Legend
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Posted: #4
IMB not faring very well
 
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Posted: #5
Depeche,

I bot more at 2.35 today..an FBR guy thinks they need to raise capital based on a larger loss number than I expect. I dont see a 100M CASH loss in the cards, so this is a chance to buy more.

I could be wrong but I am willing to take that risk..
 
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Posted: #6
Quote Originally Posted by wallstreetcappers:

Market still trading range bound, chart doesnt look bullish to me, rather meandering with no trend in any direction.

Gunners, this is why MBI wasnt down today, and makes me want to go buy some myself- (CEO speaking on this piece)

MBIA continues to be a sound financial institution," he said in a statement. "We have ample liquidity, our balance sheet is built to withstand credit stress levels many multiples of what we're experiencing now, and our business model is proving that we are adequately capitalized to satisfy any potential claims on our insured portfolio."


he's kidding right?

they had enough liquidity to handle the stress of 2x Great Depression but last August almost put them under (my brother covered mbi, abk, sca as an analyst so i know them well enough)

if people think any of these bond insurers are good buys other than a 30 minute trade, please google "richard ackman, mbia"


 
Legend
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Posted: #7
IMB $2.20 and tanking, this is being priced for BK. 
 
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Posted: #8
Koaj,

I wondered the same thing but if the CEO is willing to say that and if he is wrong he will lose his job and the company will be nailed with a ton of lawsuits based on that alone.

Maybe they are more prepared than we think?

Depeche, you are seeing it right..traders thinking a liquidity issue might mean BK. I am willing to take that risk again..could be wrong and if I lost I would be mad, but I am still willing to take the risk with what I feel I know..which could be wrong of course.
 
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Posted: #9
wall - they'll be chapter 11 and its not like he defrauded anyone...they just underestimated the market and its not like they were innocent, moodys and s&p kept AAA ratings on subprime crap
 
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Posted: #10
Koaj,

If you think MBI is hitting the gutter, then short ABK first and the general SPX and banking because we will get crushed, all the financials back to the lows and lower.

I dont see it personally and you know how bearish I am/was.

You are right, they drastically underestimated the potential, and they were ALLOWED to insure investments/derivitives at margin levels which are unreal..
 
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Posted: #11
so what happens when we get another AIG type surprise?

at what point do people like warburg and others decide that the bond insurance business isnt really one thats needed and they stop throwing good money after bad (BofA buying CFC or maybe not)
 
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Posted: #12
I think AIG did this to themselves..these write downs arent shocking, but how they are handling it and the decisions AIG is making is shocking.

If you think that MBI is going down, they are the stronger of the two, thus you would want to tackle the weaker first and go after those who NEED this kind of protection, because if they dont have it, they are going to get hit as well.

MBI said they have been paying on some claims, so some firms are calling in markers on the insurance.

You could be right, I just think in this situation they will save the insurers no matter what.

Interesting seeing which banks are lagging, those that are closer to their lows compared to others.

BAC faring worse than C, LEH etc. The CFC buyout is going to be a noose around the neck for BAC for quite some time.
 
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Posted: #13
we both laughed at bofa for buying mozillo's excrement at 18 and then the rest of the company when it went down to 6...just to save face

if BofA didnt see the potential writedowns, then their lawyers, bankers, and strategists (all who are much smarter than me) must have ignored them or didnt think they were bad enough to deter the deal
 
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Posted: #14
That or they thought the turnaround would be sooner.

The reason I own IMB is because of their Calif exposure and if/when the Calif market turns, IMB will be doing fine, might be similar reason for BAC, in addition to them sinking in a ton of cash (preferred purchase) which goes bye bye if they DONT buyout CFC.


 
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Posted: #15
speak of the devil:

3:13PM MBIA Inc: Moody's says worsening second lien RMBS could impact financial guarantor ratings (MBI) 9.57 -0.27 : Moody's highlights the persistent poor performance and continued downward rating migration among 2005-2007 vintage second lien mortgage securities. Moody's notes that financial guarantors have significant exposure to second lien RMBS, primarily through guaranties on direct RMBS transactions, and to a lesser extent, through exposure to ABS CDOs, where second lien RMBS securities typically constitute less than 5% of collateral within such CDOs. Moody's loss expectations for this asset class are higher than previously anticipated, owing to worse-than-expected performance trends. This could have material implications for the estimated capital adequacy of financial guarantors most exposed to this risk. In recent announcements of first-quarter 2008 earnings, MBIA (MBI) and Ambac (ABK) both reported material credit impairment losses on ABS CDOs and loss reserve charges on direct RMBS exposures, including second lien securitizations. Moody's said that incurred losses within both firms' direct RMBS and ABS CDO portfolios are now meaningfully higher than the rating agency's prior expected-case loss estimates, elevating existing concerns about capitalization levels relative to the Aaa benchmark. Moody's intends, in the short term, to assess whether worsening performance in this sector is likely to be material for exposed financial guarantors, and will update the market as appropriate
 
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Posted: #16
Yep..

And look at who got hit harder, ABK down almost 8% while MBI in the middle 5% range.

If you think the group is in trouble, ABK might be the pig that goes under versus MBI.

Tough to call but MBI has MUCH more cash and they have other sources to get MORE cash.

What this shows me is companies cannot say NO to wall street. MBI and ABK chose to do business guaranteeing these exotic instruments of death rather than stick to what they have done business wise for twenty years.


 
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Posted: #17
oh my this imb is making me sick....
 
I made a decision that I will NOT sell, I'm either going to lose it all or make some good money.  Only problem, is I may have to wait a long time.  2500 shares, in for about 15k, OUCH.
 
 
 
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Posted: #18
Grinder,

How many times have you sold CCs on the stock?

I am with you, this is either a great home run or a big crash. I just dont see them going under but it might be ugly for a while.
 
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Posted: #19
cpi data

what a joke...since when does food and energy not count in for inflation data?


 
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Posted: #20
more

see sen shelby's quotes

and yet we're lowering reserve requirements for these two shithole companies so they can buy more bad mortgage debt. the government will do more to bankrupt our system than a angelo mozillo (et al) every could

sorry to be such a bear but this makes zero sense
 
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Posted: #21
I see DRYS went back over $100 per share today... Kudos to you guys that stuck with it really bounced back well
 
All in all looks like market doing well today
 
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Posted: #22
Piles,

What DRYS shows is that the market can be wrong for a very long time, but if you feel you are right and can handle the pain, then the short term pain can be a long term gain.

IMB is the same for me..short term it looks brutal but like DRYS, I think the market is wrong long term and I am willing to risk it to see.
 
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Posted: #23
sell off late in the day.  then we have options expiry on friday.  should be an interesting next two days. 
 
is it almost time for that next leg down?  what a rally we've been on since late March. 
 
Prospect
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Posted: #24

Quote Originally Posted by wallstreetcappers:

Grinder,

How many times have you sold CCs on the stock?

I am with you, this is either a great home run or a big crash. I just dont see them going under but it might be ugly for a while.

quite a few times but didn't always do it against all of them, and often sold them 2 strikes higher, but after adding them up its been around $1700 that i've pulled in. 

pains me to think I had drys 70's calls last month that I sold for a loss.  Do you expect a big move either way on earnings day monday for drys?

 

 

 
 
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Posted: #25
Grinder,

Want to know the killer?

I thought about rolling into the May 75s, they were going for 3 bucks close to expiry, now they are trading for 25. That is an 8 bagger in a stock we know.



I think earnings takes it down..they might miss, but it doesnt matter, the stock is going to KILL Q2,3,4..huge numbers are coming..I have to buy on weakness.
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