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33 Comments

  • CyrusTG 4 months ago

    I’m long Julie’s chest. Short everything else.

    • David Waring 4 months ago

      Interesting video but the statement that not bailing the companies out would reduce faith in the debt of the US Government is mistaken. The reality is that the opposite is true. Currently these are private companies to which the US Government does not have exposure. Should the government take over the companies, they effectively take on an additional $5 Trillion in debt that was not on their books before. This makes US Government debt more risky, and all else being equal, would make investors less likely to lend the US Government money, not the other way around. I hate it when people just point out mistakes so I will be sure to comment on one of the many things that I enjoy about your videos in the near future.

      Dave

      • howard lindzon 4 months ago

        David - these are off balance sheet companies of the US Government so I would argue that they are in fact already governement businesses.

        • David Waring 4 months ago

          Hey Howard, Thanks for your response. While I am a bit new to the intricacies of off balance sheet entities, as I understand it one of the primary purposes setting an entity up as off balance sheet, is to separate the risk of the off balance sheet entity from the entity that set it up (in this case the US Government). If I am understanding this correctly, then thinking as a US Government bondholder or potential bondholder, if Freddie/Fannie go bankrupt, then as a US Government Bondholder I am shielded from that risk because the government is not on the hook for those losses. If however they decide to intervene, even though they are not required to however, then investing in US Government Debt just got a lot riskier, because of the additional liabilities that the Government has now taken on.

          As a side note, the reason why banks were forced to bring their off balance sheet entities back on balance sheet as I understand it, is because they were contractually on the hook, as in order to get the entities financed they agreed to be lenders of last resort. The difference here is that the government has not contractually agreed to this, so right now US Bondholders are shielded from any default risk related to Fannie/Freddie, where share and bond holders of all the banks we are reading about never were.

          Dave

        • HelicalZz 4 months ago

          So suppose I can only buy 1 rubber band. Do you think I should borrow based on that asset, use the proceeds to buy 99 more rubber bands, and resell them as a package? Or perhaps buy just one large rubber band, section it up and tie it off into different tranches of smaller rubber bands and sell it that way.

          I struggle appreciating the similarities and differences between rubber bands and bubbles.

          • Abe 4 months ago

            Would the quality of tranches of smaller rubber bands be the same as the one bigger one? What if word got out that the tranches weren’t worth anything and so you all of a sudden had to sell 400 to make the same return that you would have if you’d left the first one intact? Assuming of course that you could borrow enough to get to 400 tranches.

            I don’t know if I’d want to borrow almost 100 times against what I could actually buy, not in this economy anyhow.

          • Egotrader 4 months ago

            Hey Julie,

            What’s up with the lack of TANnage?

            I guess you haven’t been up to the Hamptons at all this summer?

            • ZenProfit 4 months ago

              Ego:

              Julie does go outdoors: she was at Billy Joel’s Shea Farewell last week. Oh wait, that was a night show. Maybe Julie’s a vampire and allergic to sunlight.

              BTW: Julie does look “enhanced” of late.

              • Rebecca 4 months ago

                In two months I start living in my first apartment. Buying groceries. Etc. And then in just two years I’m off in the big wide real world with careers and things.

                Great timing, huh?

                • julie Alexandria 4 months ago

                  Congrats, Rebecca -
                  It will for sure be the most exciting time in your life!

                  • Rebecca 4 months ago

                    Except I meant that the timing is bad economy- and housing-wise. :( But thank you!

                    • Buck Woodford 4 months ago

                      Rebecca..

                      i’m 31 and it feels like yesterday that i was in your shoes (it was in fact definitely not yesterday). still, the old advice of controlling what you can and not worrying about what’s out of your control has no expiration date. screw “the economy.” we are all participants, and the reported numbers are an average in many ways. be above average.

                      Bottom line: If we have anything great left in this country (besides the NFL) it’s our economic freedom. You have the ability to chart your own course, but it takes a combo of work and “good breaks” — the kind that happen to folks that work hard rather than fret about “the economy”.

                      Guess I’m practicing for giving my future child their own advice. :)

                      • Rebecca 4 months ago

                        Thanks so much for your comment. You’re definitely right and I’ll absolutely keep that all in mind!!

                  • Andy Swan 4 months ago

                    Actually I’d suggest that this is good timing. The bad timing was for all the people that came into the world during the froth a few years ago….bartenders turned mortgage brokers making 300k for doing nothing. Now they are stuck in big houses that they wrote themselves interest-only loans to buy, no job and destroyed credit.

                    Definitely better to figure out how to get along when times are “a little down” rather than “really easy”.

                    You’ll do great!!! Oh…and I’m with Julie….you’ll have a BLAST!!!

                    • Adam Hobson 4 months ago

                      I’ll second Andy on that. I’m two years out of college, and the economy is great for us young folks. Depending on your field, many companies are canning the old folks with bloated salaries and hiring up tons of fresh grads at relatively cheap entry level salaries.

                      Regarding the housing market, I’m in no rush to go house shopping, but I have a few friends who are starting to think about it and they love the depressed housing market. They’re going to be able to buy homes now that are 30% cheaper (or more!) than they were two or three years ago and at pretty low interest rates. Plus they know now to stay the hell away from ARMs.

                  • Jeff Garlick 4 months ago

                    Why can’t Freddie’s brother Bernie bail us out? Charlie’s Angels AND Oceans 11,12,13 money HAS to be enough right?

                    Seriously, this is no different than me loaning money to relatives who are bad risks if I expect to get my money back - I loan the money to the mooches, they can’t pay and then I go belly up! These 2 companies should have vetted the loanees A LOT better because with all the other money that were pouring into 2 wars, disaster relief and $600 (mine was ONLY $300) feel good rebate checks, there’s no way in HELL we can bail these guys out!

                    I CAN get you 10% percent off rubber bands though Julie! Just let me know! ;-)

                    • 36DD 4 months ago

                      Show more cleavage, yes!! Sex sells, so start getting the Strip going in wallstrip. do like the naked news until people watch, go paid, and then wear clothes again, sweet. nice episode on whatever it was on.

                      • julie Alexandria 4 months ago

                        Ego : I wish I could go to the Hamptons - but seeing as it is a haven for Manhattanite douchebags and girls who have a penchant for Tory Burch flats and blown out hair; I will keep my distance. Maybe sometime soon I will take a real vacation - but that would involve leaving the tri-state area.

                      • Kelly 4 months ago

                        There’s a “lack of faith in America”???
                        See what happens when you take prayer out of schools!
                        ;)

                        • Andy Swan 4 months ago

                          My vote is CBS needs to send Julie and Wallstrip to Miami….make all the ads CSI Miami nonsense and focus on beach-based companies.

                          • julie Alexandria 4 months ago

                            Oh Andy -
                            I am SO with you on that! I will send a strongly written letter to the CBS execs - and demand a Suite at the Delano - furnished with white orchids and green apples. No exceptions. What? …its in my rider.
                            :)

                            • Andy Swan 4 months ago

                              niiiiicccceeeee You’ll probably need to do more research on Fortune Brands while you’re down there….get her a corporate card, Moonves!

                          • ZenProfit 4 months ago

                            Andy:

                            Congratulations.

                            You gave Julie a Big O. Is the correct term an eO? Or an iO?

                            • RL88 4 months ago

                              What kind of rubber bands are we talking about here?

                              • Cheryl 4 months ago

                                so now we have to spend less, drive less, eat less, live less comfortably…in the excessive consumer culture that we live in, learning to conserve doesn’t seem like such a terrible idea…

                                • Sharon 4 months ago

                                  Once I’m out of school, I’ll be living in a cardboard house assembled of boxes and rubber bands.

                                  • S.C 4 months ago

                                    Its sad that the economy is going down the drain so fast…an the government isnt doing anything to pick up…so we all wont be homeless we need to learn to reserve an use less of things

                                    • Batman 4 months ago

                                      Julie-Your my dreamweaver. When will Wallstrip do an event for its loyal fans?

                                      • Connor 4 months ago

                                        The way i see it its the governments mess the economy is at an all time low, so it is their responsibility to clean up the mess…except that means we all pay for it…quite the conundrum

                                        • Tyler 4 months ago

                                          People not being able to afford their mortgage is a scary problem…
                                          so is going 5 trillion additional dollars in debt..

                                          which is the lesser of the two evils? Any opinions?

                                          • Buck McHugh 2 months ago

                                            These government bailouts are nothing more than a quick fix of fundamental problems with our economy. Uncle Sam can just print the money and we have to deal with hyper-inflation as the result. posted by Buck McHugh
                                            Comment by Howard Buckl McHugh

                                            • Pallas 2 months ago

                                              I bought Fannie and Freddie at 0.33 cents and today it is back at 1.30. I guess they live to NOT be de-listed another day. I will not sell. I’m in it for the recovery of the U S of A.

                                              I am not a penny stock day trader. I am 300% Long on FRE/FNM. Our houses and our way of life still set the pace and will return. Look around you in the major metropolitan areas. The rich elsewhere send there 20 year olds to our schools and their 30 year olds to our suburbs. When we fall they buy a piece of us so they can ride our coattails to prosperity once our hangover clears.

                                              FRE/FNM back most mortgages and those loans rebound once our houses do. And when they do they will re-privatize and it will be like the stock is pre-IPO. If it splts into smaller private companies even better!

                                              Do you believe in an American House? I do.

                                              BRIC? Whatever. More drowned in the last India Flood season than would have in 20 Katrinas. 900 million Indians still live on less than 2 USD per day - half of that due to casteism that is worse than our pre-civil rights era. China - heard of toxic waste and the one child syndrome of there. China is civil unrest explosion waiting to happen. Newsflash: BRICs have not had their civil war yet..as in 1865 Gettysburg.

                                              We are 150 years ahead of the so called emerging economies.

                                              Buy American. Banks Stocks Cars and Corn baby.

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