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"A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"

 
Anonymous Coward
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09/06/2007 08:44 PM
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"A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
Kass: The 'G Phone' and Other Chatter

By Doug Kass
RealMoney Silver Contributor
9/6/2007 6:23 PM EDT
[link to www.thestreet.com]

This blog post originally appeared on RealMoney Silver on Sept. 6 at 7:46 a.m. EDT.

Every few weeks, I recap 10 tidbits I've picked up from trading desks and other industry sources. These items have not been confirmed, but either have affected, or could affect, the stocks mentioned. The first such column, in early January, proved prescient on several fronts. Here are this week's top 10.

1. The launch of the Google (GOOG) Phone appears close at hand. The architect, Rich Miner, has already exhibited the cell phone's prototype to a group of Boston venture capitalists and entrepreneurs after completing the design work in a Cambridge, Mass.-based office in Kendall Square. The G Phone will be based on a mobile variant of Linux and will be able to run Java virtual machines.

2. Democratic presidential aspirant Sen. Hillary Clinton (D., N.Y.) will shortly announce a broad, strategic and comprehensive $25 billion dollar bailout for U.S. homeowners, coupled with legislation geared against predatory lending. Assisted by input from Citigroup's Bob Rubin and from several senior Goldman Sachs officials, Clinton's initiative will be far greater than her previous recommendation, the 21st Century Housing Act, which was made early this year. (Clinton's cabal is so confident that she will win the Democratic presidential nomination that they are already considering vice presidential nominees.)

3. The planning for the Fox Business Network and the acquisition of former CNBC reporters continues apace. The Oct. 15 debut will be positioned on Time Warner Cable Channel 43, at which time, Fox News will move to Channel 44. The launch appears on target, and Director of Business News Alexis Glick (who will also be on air) is expected to bag CNBC's Liz Claman and Eric Bolling.

Also being "courted" are David Faber and Mark Haines and a well-known CNBC political commentator. Attempts to engage Maria "Money Honey" Bartiromo in a multiyear, multimillion dollar deal were squashed, owing to her contractual obligations. (Her CNBC deal expires in 2009.) A half-hour show, "The Bear Cave," will be introduced in early 2008, featuring a well-known Kodiak. On a separate note, CNBC will be making some important after-market programming changes later this month.

4. In the face of a bloated fixed-cost structure, Countrywide Financial (CFC) is planning further massive personnel layoffs and branch office closures. Rollover of its paper continues to be difficult, and Bank of America (BAC) is considering an additional investment in the company (albeit at a lower exercise price than the earlier financing).

In other housing news, a large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia (WB) could be on the hook for its debt. In the public arena, another homebuilder is unable to renew its credit lines and may face the same fate.

5. The private-equity market is at a standstill as attempts to merchandise the current paper have fallen on deaf ears. Executive decisions at the major banks and investment bankers are about to concede on pricing -- private equity is not budging much -- in an attempt to swiftly cut into the inventory of bridge loans, leading to sizable write-offs in the months ahead.

Nevertheless, Goldman Sachs (GS) will report a surprisingly healthy quarter as a massive volatility bet paid off. Merrill Lynch (MER) will not be so lucky, however, nor will JPMorgan Chase (JPM) or Citigroup (C) . Goldman Sachs and Morgan Stanley (MS) are planning to launch $5 billion-plus in distress leveraged-loan funds to sop up the mess that they have helped create. A major regional bank will be cut in the fray and report sizable losses, leading to its acquisition by a major money-center bank.

6. Despite Wall Street reports to the contrary, Apple's (AAPL) iPhone sales have been disappointing over the last 45 days. By contrast, iMac sales have dramatically beaten consensus forecasts.

7. Yahoo! (YHOO) is engaged in preliminary takeover talks with multiple media companies. Microsoft (MSFT) is considering a game-changing acquisition that would be far larger than any of its previous deals.

8. Friday's payroll report will be surprisingly weak, and large downward revisions will be made to its prior monthly releases.

9. China means business in its attempt to curb inflation and slow down economic growth. It will shortly, through a series of increases, raise bank reserve requirements. Other efforts to curb speculation in its stock market are in the offing as well.

10. Back-to-school retail sales are horrible. Lower comp guidance from Wal-Mart (WMT) and others is expected over the next two weeks.
Anonymous Coward (OP)
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09/06/2007 09:11 PM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
bump
For What It's Worth
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09/06/2007 09:34 PM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
In other housing news, a large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia (WB) could be on the hook for its debt. In the public arena, another homebuilder is unable to renew its credit lines and may face the same fate.


 Quoting: Anonymous Coward 270938


Wow, right on “Q”. Check this out.

"Countrywide Financial Corp shares on Thursday fell below the $18 price at which Bank of America Corp may convert its $2 billion investment into common stock."

[link to www.earthtimes.org]
Anonymous Coward
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09/06/2007 09:39 PM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
rump...
Grendelmort

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09/06/2007 09:40 PM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
I didn't know "Jim Walter Homes" had that much clout!
"God sent me to piss the world off"
Anonymous Coward
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09/06/2007 10:08 PM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
front page news
Anonymous Coward
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09/06/2007 10:40 PM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
so... it looks like Wachovia aint gonna Watch over ya...
Seadubb

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09/06/2007 10:47 PM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
Not to worry...the FEDS will pump us into hyper-inflation as they already are (>200 trillion so far)
Anonymous Coward
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09/06/2007 10:49 PM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
yeah right, who cares...I'm gonna back to watching my reality shows.
Anonymous Coward
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09/06/2007 10:55 PM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
yeah right, who cares...I'm gonna back to watching my reality shows.
 Quoting: Anonymous Coward 69144


By jove, I think you're onto something there.

tomato
Anonymous Coward
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09/06/2007 10:59 PM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
so... it looks like Wachovia aint gonna Watch over ya...
 Quoting: Anonymous Coward 294309


It's a weird name. You say it phonetically, and it sounds like "watch over ya". But on TV they call it Whack-ova-ya.

Strange corporate name. Or not, maybe.

hf
susano

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09/06/2007 11:14 PM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
any idea who the homebuilder is?
jlazarus

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09/06/2007 11:16 PM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
10. Back-to-school retail sales are horrible. Lower comp guidance from Wal-Mart (WMT) and others is expected over the next two weeks.
 Quoting: Anonymous Coward 270938

contrasting statement to this article:

[link to news.yahoo.com]

Retail Sales In Aug. Topped Forecasts On School Bounce

Marilyn Much Thu Sep 6, 7:00 PM ET

After a so-so July, retailers rang up stronger-than-expected August sales as consumers hit the malls for late back-to-school shopping, ignoring credit market woes for now.

Overall, August sales of stores open at least a year rose 3.1% from August 2006, above forecasts of 2.6%, said Ken Perkins, president of Retail Metrics. Overall, 64% of chains topped views, well above the long-term average of 55%.

August's showing followed July's 2.9% gain as consumers pulled back spending amid housing woes and tightening credit.

Retailers got a nice bump in August from strong back-to-school selling, Perkins says. Later back-to-school starts and a tax holiday shift in Florida and Texas from July to August boosted sales at teen apparel chains. The group posted a 6.8% gain in same-store sales. All topped views except Aeropostale.

High-end chains continued to do well. Saks enjoyed an 18.2% same-store sales gain, crushing forecasts. Nordstrom's rose 6.6%, also topping views.

Wal-Mart sailed past views with a 3.1% gain in August same-store sales as it reaped the benefits of price cuts on all sorts of school supplies and electronic goods.

It was an encouraging month for spending with solid back-to-school sales, said Perkins.

Retailers' inventories have remained lean, which led to few markdowns during the month, said Carl Steidtmann, chief economist at Deloitte Research.

"That should result in pretty good profitability," he said.

Still chains face some challenges in the months ahead.

"We would point 15ut that September comparisons are going to be more difficult as looming macro head winds continue to be a drag on consumer spending," Perkins said. "It's likely that September same-store sales will return to the more normal slowing trend of below 3% comp growth."

The head winds he refers to are a declining housing market and a deteriorating credit situation in the wake of the subprime crisis.

July pending home sales dived to a six-year low, the National Association of Realtors said Wednesday.

Tightening credit standards are going to make it more difficult for consumers to get more access to cash, he said.

The August showing suggested that so far the financial crisis seemed to have had little impact on consumer spending, added Michael Niemira, chief economist at the International Council of Shopping Centers.

"But we're not out of the woods yet. There are new revelations on housing-related problems still unfolding," he said, citing Thursday's report of record home foreclosures. "There may be more stress on the consumer to come."

By his calculations, August same-store sales rose 2.9% above last year. That was slightly stronger than July's 2.6% year-over-year rise. But it was weaker than the 3.8% gain in August 2006, he said.

Consumer spending is growing at about the same pace since February, he said. February to August same-store sales rose 2.4% vs. February-August 2006.

He sees a 2.5% rise in same-store sales in September.

Despite housing-related woes, Niemira said, "Don't write off the consumer yet."

Personal income growth continues to be strong, he noted.

Continued job and wage growth are key. The Labor Department releases the August employment report on Friday.
I will accept any rules that you feel necessary to your freedom. I am free, no matter what rules surround me. If I find them tolerable, I tolerate them; if I find them too obnoxious, I break them. I am free because I know that I alone am morally responsible for everything I do. ~ Robert Heinlein
Anonymous Coward
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09/06/2007 11:22 PM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
what does this mean if we are a customer of these two banks. Is our money at risk, will they be closing their doors, or is this just a write off for them.

I don't want to have to change banks, because where ever I go the same thing could happen to that bank
Mark In NYC

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09/06/2007 11:52 PM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
Hmmm. Toll Brothers, Pulte, and US Homes are all (as far as I know) still publicly traded. So that lets them out. If the poster meant "private" as in privately held vs publicly traded.

Those are the national boys who's debt could potentially make a major dent on B of A's balance sheet. Remember B of A is HUGE and there is so much money that they have trouble keeping track of where it is and when.

So now I'm wondering who in hell the OP is talking about. Any ideas?

Life really is a banquet - and truly - most poor sucker are starving! Enjoy the ride baby.
Anonymous Coward
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09/06/2007 11:53 PM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
Is it any suprise that your property, that you just rent (cannot own) needs to be valued at about triple what you now owe for it??? See that way you can never have clear title, which you did not have anyway, however that is all coming to light now.
susano

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09/07/2007 12:03 AM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
I'd love to see Pulte go under
LS

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09/07/2007 12:07 AM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
I'd love to see Pulte go under
 Quoting: susano

why?
MAKA = Make America Kind Again
The Monk
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09/07/2007 12:17 AM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
"Nevertheless, Goldman Sachs (GS) will report a surprisingly healthy quarter as a massive volatility bet paid off."

There are two kinds of investors, those who panic and those eat them.
Anonymous Coward
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09/07/2007 12:49 AM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
c'mon use your imagination...

Wachovia = Walk-ova-ya
in da know
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09/07/2007 01:05 AM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
I'd love to see Pulte go under

why?
 Quoting: LS

Coz they build crap, for one thing.

I've fixed dozens of their shitboxes here in Phx.
Anonymous Coward (OP)
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09/07/2007 01:37 AM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
I'd love to see Pulte go under

why?

Coz they build crap, for one thing.

I've fixed dozens of their shitboxes here in Phx.
 Quoting: in da know 262023


Yup, I live in one in N. Phx, I agree.

headbang
Redheaded Stepchild

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09/07/2007 01:39 AM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
contrasting statement to this article:

[link to news.yahoo.com]

Retail Sales In Aug. Topped Forecasts On School Bounce

(snip)
 Quoting: jlazarus


JLAZARUS:
Do you get the feeling that they are either leading us around by the nose, or their left hand doesn't know what the right hand is doing.

Good grief!
"Until you are willing to organize your friends and neighbors and literally shut down cities - drive at 5mph through the streets of major cities on the freeway and stop commerce, refuse to show up for work, refuse to borrow and spend more than you make, show up in Washington DC with a million of your neighbors and literally shut down The Capitol you WILL be bent over the table on a daily basis." Karl Denninger

Don't blame me; I voted for Ron Paul.


Silence is consent.
Redheaded Stepchild

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09/07/2007 01:42 AM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
Okay, I don't know anything about Pulte outside of Texas, but I nearly bought one of their homes here in north Texas, and I am soooooo glad I backed out of the deal (2002). Cracker-box houses in cracker-box subdivisions...they were "the" most affordable new home builder in the area. Five years later, and their subdivision already looks exhausted and worn out.

The other possibility is CENTEX.
"Until you are willing to organize your friends and neighbors and literally shut down cities - drive at 5mph through the streets of major cities on the freeway and stop commerce, refuse to show up for work, refuse to borrow and spend more than you make, show up in Washington DC with a million of your neighbors and literally shut down The Capitol you WILL be bent over the table on a daily basis." Karl Denninger

Don't blame me; I voted for Ron Paul.


Silence is consent.
highstrung

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09/07/2007 01:59 AM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
i wonder if it is beazer homes.
If there is a will.... There is most certainly a way!
Anonymous Coward (OP)
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09/07/2007 02:06 AM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
I'm hearing either one, Centex or Beazer
jlazarus

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09/07/2007 09:51 AM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
JLAZARUS:
Do you get the feeling that they are either leading us around by the nose, or their left hand doesn't know what the right hand is doing.

Good grief!
 Quoting: Redheaded Stepchild

Perhaps Both?!, LOL!

Seriously though, glad you saw the irony there as well. I see this type of thing all the time it seems - one day there will be one article saying 'blah, blah, blah' and then (sometimes on the same day), I'll find totally contradicting articles elsewhere.

Personally, I think it's just 'spin this, spin that' to serve reporting agendas on a whim. Aggravates me to no end!
I will accept any rules that you feel necessary to your freedom. I am free, no matter what rules surround me. If I find them tolerable, I tolerate them; if I find them too obnoxious, I break them. I am free because I know that I alone am morally responsible for everything I do. ~ Robert Heinlein
For What It's Worth
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09/07/2007 09:58 AM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
i wonder if it is beazer homes.
 Quoting: highstrung


According to CNBC this morning Beazer has apparently received a default notice. We may have a winner!
Anonymous Coward
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09/07/2007 10:35 AM
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Re: "A large, private homebuilder is about to declare bankruptcy, and Bank of America and/or Wachovia could be on the hook for its debt"
But Beazer is not private.





GLP