Friday, August 24, 2007

Panic of 1907 ?

Sub prime tsunami spreads, and it all in the package .So here is the deal, looks like the wise men of Wall Street put together mortgage backed bonds that could have high credit ratings yet contain a few illiquid credits (low credit quality credits). Although this spreads the risk over the credit system and could disperse losses it undermines the confidence of buyers and credibility of the rating systems creating suspicion and illiquidity. Translation: buyers got more than they paid for and not what they paid for. So buyers are now looking for assurances that they are getting what they think they are getting. This implies that in order for buyers to step up credit standards will have to be greatly increased, thus a “credit squeeze” is underway, or as some would say a return to more prudent normal lending practices.

Buyers on the other hand are busy confessing their sub prime indiscretions on a daily basis, many being forced to admit that they shouldn’t have been buying sub prime paper in the first place.

Mean while other investors ask; Is there really a crisis or is this just an effort by large investors to get the federal government to bail out home owners with sub prime loans and therefore bail out wealthy investors that invested in hedge funds who bought those loans? I respect Bill Gross of PIMCO but he sounds like he is lobbying to get preferential treatment to some investors. If you’re good enough to take the big risks and make the big money, you should be good enough to take the hits when things don’t go your way.

I am also pleased to announce that I am now to offer Investment Advisory Services. I can offer access to a diverse rage of Investment Strategies, low initial minimum investment, a customized portfolio structure, access to qualified and respected advisors, offering a wide range of investment strategies to balance risk and diversify.

I have some good news for all clients, those difficult to fill out class action suit claims will now be automatically submitted for you by my partner Horwitz and Associates and all money’s received will be directly deposited into your Horwitz Account.

Thank you again for all the referrals you have passed my way the last couple of months I really appreciate it.

Don’t forget through I have entered into an agreement with Elliott Wave International to provide additional content on Elliot Wave Specific strategy and commentary. Contact me if you are interested in using the Elliott Wave to more effectively manage your portfolio.

James Foytlin
Financial Advisor
toll free 1(866) 492-3959
Cell 1(201)966-7788

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