Does Anyone feel like Bailing

[classicman]

Ahhhh - thats another unforeseen cost - the glatts err, lawyers. Risk of suits and all.

[sugarpop]

errr, what is SOP?

[classicman]

Standard Operating Procedure

[sugarpop]

ahhh, OK, thanks classic.

I am HOPING that Obama puts an end to SOP. He has vowed to cut waste, and that sounds like a lot of money going out simply because contractors have always gotten away with it. Just because something is being paid for by the govenment doesn't mean contractors should get a blank check. They have gotten away with robbing us blind for decades. It's time for that to stop. And Obama said as much in a speech he made not too long ago. so yea Obama!

[xoxoxoBruce]

The other night we were discussing at work why the man-hours per unit has crept up better than 5k. Basically it's because the customer is demanding the place look like no work is being done, 100% of the time. After I retire I'll be able to expound at length.

[TheMercenary]

This guy bailed.

Freddie Mac Exec Found Dead At Home
David Kellermann, Acting Chief Financial Officer Of Embattled Mortgage Company, Dead In Apparent Suicide

http://www.cbsnews.com/stories/2009/...n4961169.shtml

[sugarpop]

I saw that. I wonder if had committed some kind of fraud or something and he couldn't live with it anymore. That's what came to my mind. Of course, it could have absolutely nothing to do with that. He could just be depressed because his relationship was tanking or something.

[Happy Monkey]

Of course, he's now on the right wingers' Obama Death List.

[classicman]

Did he know the Clintons?


just add him to the list.
j/k

[xoxoxoBruce]

It's his wifes fault, she said she wanted a man that's hung.

[sugarpop]

*groan*

[classicman]

Meltdown 101: How do bank 'stress tests' work?

WASHINGTON – After weeks of speculation, regulators led by the Federal Reserve are telling banks how they fared in the "stress tests" at the center of the Obama administration's financial rescue plan.

Markets rallied and investors breathed a little easier Friday after a Fed news release on the methods underlying the stress tests. But the white paper, which one former bank examiner for the Fed called "not for mass consumption," left lay people wondering what it all means.

Here are a few questions and answers about the stress test's methods and the next steps for shoring up the financial system.

Q: What is this "stress test"?

A: The "stress test" is actually two tests measuring how much value banks' assets — loans it's made along with various other investments — would lose over the next two years under different economic scenarios.

The first scenario was based on predictions about the current recession. It assumed unemployment will reach 8.8 percent in 2010 and house prices will decline by 14 percent this year. The second scenario was for a worse-than-expected downturn. It said unemployment will reach 10.3 percent in 2010 and house prices will drop by 22 percent this year.

After testing banks' assets to see how much value they could lose, officials compared the losses to the banks' capital cushions — basically, the money they've got in reserve — to see if the banks could survive a bad recession.

Q: Who participated?

A: The tests were run on 19 large bank holding companies, including an insurer, an auto finance company, a credit card company and banks ranging from massive Wall Street houses like Citigroup to regional banks like KeyCorp and PNC Financial Services. The banks all have $100 billion in assets, and together hold half the loans in the U.S. banking system and two-thirds of the assets, according to the Fed.

The tests were performed by the banks' regulators, including the Federal Reserve banks, the Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency.

In case you're curious, here's a full list of the Big 19: JPMorgan Chase & Co., Citigroup Inc., Bank of America Corp., Wells Fargo & Co., Goldman Sachs Group Inc., Morgan Stanley, MetLife Inc., PNC Financial Services Group Inc., U.S. Bancorp, Bank of New York Mellon Corp., GMAC LLC, SunTrust Banks Inc., State Street Corp., Capital One Financial Corp., BB&T Corp., Regions Financial Corp., American Express Co., Fifth Third Bancorp and KeyCorp.

Q: What did the regulators find out?

Nice article in laymans terms of what it is and whatnot.

[tw]

So many have already criticized this stress test. Not one critic knew what it was - at all - until last Friday (24 April 2009). And still, little is known.

We do know this. A stress test has already caused banks to reassess their financial stability. Anybody who was not doing that most certainly took a second and third look. Some undiscovered new problem would be employment suicide for the bank's management. A good thing considering how widespread their denials were in those big banks.

[TheMercenary]

Good stuff Classic.

[sugarpop]

It says this...

But the truth is, we just don't know. Larger credit problems or a severe downturn still could threaten these banks, especially regional banks that own a lot of risky mortgages. If the banks go down, the government may have to spend more money forcing them to merge — and that could set off a whole new cycle of uncertainty.

Q: Does that mean we're staying on the bailout train?

A: For the foreseeable future. Regulators have decided these banks are "too big to fail." In other words, their failures could wreak havoc on the financial system, like what happened last fall when Lehman Bros. declared bankruptcy. By all indications, the Fed is ready to do whatever it takes to make sure that doesn't happen again.

So let me get this straight, these banks are too big to fail, but if one or more is unable to weather the economy, they will have to merge with other big banks too big to fail? Aren't we exacerbating the problem? Shouldn't they broken down into smaller banks instead?

Geez, the way smart people think sometimes is beyond my reasoning.