Gary_Yngve Posted September 18, 2008 Posted September 18, 2008 I have a decent chunk of money with WAMU earning 5%. It's FDIC insured, so that's A-OK with me. Quote
prole Posted September 18, 2008 Posted September 18, 2008 its becoming a great time to buy cheap stuff. wish I had a bit more cash This is getting pretty cheap. With Stock Sinking, WaMu Appears Headed For Sale The company's stock fell 31 cents to $2.01 Wednesday, leaving the stock price with a decline of 85 percent so far this year. The erosion has left WaMu with a market value of about $3.5 billion — down from $43 billion at the end of 2006. Quote
Hugh Conway Posted September 18, 2008 Author Posted September 18, 2008 It's FDIC insured, so that's A-OK with me. Quote
Gary_Yngve Posted September 18, 2008 Posted September 18, 2008 Do you really think that the FDIC is not going to pay up? There would be riots in the streets, lynchings of banking executives, and the voting out of everyone in Congress if the FDIC couldn't/wouldn't pay up. Quote
olyclimber Posted September 18, 2008 Posted September 18, 2008 of course the FDIC would pay up...but that fund is already below the mandated level right now. Quote
archenemy Posted September 19, 2008 Posted September 19, 2008 I am not sure it could be paid with all that money being spent on a big bridge loan... Quote
Gary_Yngve Posted September 19, 2008 Posted September 19, 2008 If the FDIC is not paying up, it will cause a vicious loop of more and more people pulling money out. Very bad. Best thing for the govt to do if there's no other choice than for FDIC not to pay is to print more currency. Quote
prole Posted September 19, 2008 Posted September 19, 2008 They goin' be wishin' they could print some Euros! This Federal bad-credit depot stunt better work or we're going to be hearing some giant sucking sounds pretty soon. Quote
sobo Posted September 19, 2008 Posted September 19, 2008 Best thing for the govt to do if there's no other choice than for FDIC not to pay is to print more currency. Gary, you do know what that leads to, don't you? Germany, 1923 ring a bell? Israel in the early 1980s? Hell, Zimbabwe right now? The Fed has done a damned good job of keeping inflation as low as it is. Why would you want to fuck that up by printing more money that's not backed by anything? Quote
sobo Posted September 19, 2008 Posted September 19, 2008 Yeah, I transfered my account from WAMU to BECU, it's a credit union, not a bank. the teller at WAMU wasn't too happy about it but oh well. Ditto. I quit using banks 25 years ago. Credit unions are da shizzle! Quote
Gary_Yngve Posted September 19, 2008 Posted September 19, 2008 Gary, you do know what that leads to, don't you? Germany, 1923 ring a bell? Israel in the early 1980s? Hell, Zimbabwe right now? The Fed has done a damned good job of keeping inflation as low as it is. Why would you want to fuck that up by printing more money that's not backed by anything? I guess the point is if things are bad enough that people are losing their bank money, then we're really f'ed up -- it would be as bad as printing more money. Maybe the best thing to do in that case is to have mandatory "bank holidays," like when they close the stock market when shit hits the fan? What do you think should be done if Farmer Bob goes to the bank to withdraw his life savings and is told there's no money? Quote
Gary_Yngve Posted September 19, 2008 Posted September 19, 2008 Hopefully enough of us realize that we have money we can leave in for the long term, and it will be just fine. This long-term money (e.g. retirement) can support any temporary needs. Quote
pc313 Posted September 19, 2008 Posted September 19, 2008 My bank is a web page My bank has free coffee,good coffee! Quote
pink Posted September 19, 2008 Posted September 19, 2008 my bank has hot tellers which is why i never use the drive thru Quote
Hugh Conway Posted September 19, 2008 Author Posted September 19, 2008 I guess the point is if things are bad enough that people are losing their bank money, then we're really f'ed up -- it would be as bad as printing more money. Your solution to a few people losing their money is to wipe out everyones money? Is this a joke? High inflation decimates the middle class and business. Currently inflation is >5% (annualized 5.7% in August I believe). Your "chunk" at 5% is losing money for you everyday adjusted for inflation. Quote
empire Posted September 19, 2008 Posted September 19, 2008 All we need to do is to keep pretending that both we, the banks, and the banks' banks can all own the same money at the same time, like we always have been. It's just like Schrodinger's Cat. (Except that some people get to open the box sometimes and take out some of the money, and these are the relatively small number of rich Ponzi fellows toward the top of the scheme that went through all the trouble to promise you that you will always get an X% return, as long as everyone keeps putting money in the box.) Not all economies grow eternally. Not everything increases in value over time. A dollar today CAN equal less than a dollar tomorrow. (Dismissed--you may now jump.) Quote
Gary_Yngve Posted September 19, 2008 Posted September 19, 2008 Your solution to a few people losing their money is to wipe out everyones money? Extra money can be printed in extreme moderation. No one should be punished by having their money disappear by having chosen the "wrong" FDIC-insured bank. Instead amortize the losses through a slight devaluation of currency. Why do you think that a slight devaluation from extra printing will result in a downward spiral toward hyperinflation? Do you think that letting people lose their FDIC-insured money is a better outcome? Quote
AlpineK Posted September 19, 2008 Posted September 19, 2008 Extra money can be printed in extreme moderation/quote] I've got a nice new printer, some good quality paper, nice cutting tools, and a tumble dryer to give a well used look to my product. It's available for rent. Rental fees may change on an unannounced time frame. Quote
JayB Posted September 21, 2008 Posted September 21, 2008 The devil is in the details, people. What makes you think Wamu is anything like AIG, Lehmann, or Fannie / Freddie? What do any of you know about Wamu's balance sheet? Is Wamu on the hook for tons of mortgage backed securities, highly levered instruments? Oh wait, no, actually. Just a lot of mortgages, some of them risky. Are they posting big losses? Yes. Are they in a position where they could fail at any moment? No. THey're simply not exposed to the same kinds of financial instruments that could bring such an event about. It's not your fault - the media is stupid as well. The exposures that AIG, Lehmann, and Fannie / Freddie had that brought them to the brink with a quickness are not the same exposures Wamu has. Period. Even after downgrading Wamu bonds to junk status, S&P and Moody's both acknowledged that Wamu is in good liquidity shape and well above the required capitalization levels. S&P went as far as to say that Wamu has enough cash on hand to pay all of its expenses through at least 2010. Wamu is heavily exposed to the housing market, but not through shit tons of highly levered instruments that the investment banks and mortage insurers are. If the housing market tanks worse, it's gonna hurt Wamu even more. Is it gonna drive them outta business? Maybe, possibly, in the future. But to think Wamu is gonna tank in the next few months just demonstrates illiteracy about the financial industry. But, alas, most people are dumbshits. Including many traders on Wall Street. Right now all investment analysts are coalescing around a negative view of Wamu. Why? If anyone says "hey, this isn't as bad as the rest of you think", then they're on the hook for explaining why. There's a lot of groupthink out there. It is also handy for analysts who happening to be shorting the fuck out of financials. Most of the negative outlook articles on Wamu are quoting one analyst - Dick Bove. He happens to take a particularly harsh view of the financials. He's also got a great PR agent who gets him interviews with tons of papers. It is far preferable for everyone on the street to coalesce around the same view to avoid being asked to defend their ideas. The analyst reports aren't even reporting model results - they're looking more and more like ad hoc speculation. How do I know? I read those reports (it is part of my job). I'm not saying that Wamu isn't having a hard time. They're having a really hard time. Just not enough to justify junk bond ratings and $2/share stock. So go ahead and assume that all women can't drive, all black men want to rob you, all hispanics will stab you, all asians are hard working and good at math, and that all financial isntitutions are the same and are gonna tank. Stereotyping sure helps us avoid all that critical thinking and understanding of facts. Quite a few banks have (IndyMac, etc) have and will gone under as a simple consequence of making bad loans. What concerned me quite a while ago was WAMU's origination/retention of risky mortgages in overpriced markets, the amount of HELOC debt that they were on the hook for in the same markets, and the percentage of their earnings derived from the additional interest accruing on their neg-am/pay-option portfolio. I have zero formal training in balance sheet analysis, but it looked like an ugly enough picture a couple of years ago that I encouraged anyone that I spoke with who owned the shares (all of a couple of people) to consider selling before the Great ARM Reset got underway. Maybe you could provide a link to an analysis/analyst that you think got it right? Quote
JayB Posted September 25, 2008 Posted September 25, 2008 WAMU is toast as of now, per CNBC. In FDIC hands ASAP. Quote
prole Posted September 25, 2008 Posted September 25, 2008 (edited) Hugh Conway was so off! It's the Democrat's fault for stalling the bailout. Edited September 25, 2008 by prole Quote
Gary_Yngve Posted September 26, 2008 Posted September 26, 2008 Isn't the proposed bailout, going an extra $700B in debt, basically equivalent to printing more money? Quote
Hugh Conway Posted September 26, 2008 Author Posted September 26, 2008 email Hugh just received: subject line: WaMu News | The holidays start today text: trying to entice you to give them money, unrelated to bailou Quote
Gotama Posted September 26, 2008 Posted September 26, 2008 Guess I now bank at JP Morgan. Hope they don't start charging for ATM use......... Quote
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