ES -- DX/CL -- isee -- cboe put/call -- specialist/public short ratio -- trinq -- trin -- aaii bull ratio -- abx -- cmbx -- cdx -- vxo p&f -- SPX volatility curve -- VIX:VXO skew -- commodity screen -- cot -- conference board

Wednesday, January 07, 2009

 

TARP wiped out by downgrades


meredith whitney via ft. nothing new, but improved quantification.

whitney further notes that deleveraging is still in its early stages and has much further to run, meaning that we will be living with bank selling for some time. take jpmorgan's estimate of what must be done with merrill's estimate of what's been done, and there are still years of asset deflation before us.

this underscores the need for banks to be reorganized via nationalization and cleansed of assets -- including syndicated receivables of credit cards, auto loans, commerical real estate and more beyond just residential real estate and leveraged loans -- that thusfar have not been written down to anything like realistic levels. without such a process, the banks are a capital sink of heroic proportion that could well bankrupt domiciling governments who decide they won't be allowed to fail but cannot bring themselves to nationalize.

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