Yes, Those are some good points, but shouldn't follow the money have been listed near the top? I've been wondering as to where it was heading to build a replacement bubble. With 'THE BOYS' being leverage as deep as they are, the unwinding of that leverage position will have visible effects and may not reappear in yet another bubble. At least not right away. It seems that 'they' might be trying to pull their nads off the chopping block. Unwinding their leverage, FFI exposure, yen carry trade, etc, etc. This will cut earnings for quite some time. While GS, MS & LEH go to the new FED window and 'TEST' the new facility or to demonstrate leadership. Wasn't their last ERs better than expected with all sorts of liquidity, but something to the tune of a cut in half? Why are they going to the FED window for $29B as it opens? In this latest report GS took some level 2 to level 3. Why, and how much?
Goldman's so-called Level 3 assets, which are the hardest to value, rose to about 8 percent of the firm's total assets from about 7 percent in the prior quarter, Viniar told analysts. The increase was largely related to commercial real estate loans that were moved from Level 2, where assets are valued in part using market prices, to Level 3.
Goldman has $873 billion in assets. That means Goldman moved $8.73 billion in commercial real estate loans from Level 2 "Mark To Matrix" to Level 3 "Mark To Fantasy". Something tells me Goldman did not like the answer their matrix model was giving them.
As over leveraged players attempt to get out of various carry trades here are two more dreaded words: "No Bid". This has been the case in bond and currency markets. I read at Yahoo the other day US travelers visiting Amsterdam were unable to sell dollars without going downtown to the main banks. I don't think that correlates to LTC or S&L eras.
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