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Guest Shedfish

Indymac's Got The Runs

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Guest Shedfish

while we were all staring with horror at Bed & Breakfast Badford & Mingley

In Pasadena and at another L.A.-area branch in Torrance, customers were cashing out or just stopping by to seek reassurance that their money was safe.

The mood at both branches was civilized, if anxious.

David, a 45-year-old auto mechanic, said he took $78,000 out of two CDs at the Torrance branch. And that was only after his brother and nephew got into a car accident while they were rushing to close out their $300,000 worth of accounts at the branch.

IndyMac shares sank 38 percent to 44 cents. A collapse of the largest independent, publicly traded U.S. mortgage lender could prove a headache for U.S. regulators since more than $17 billion of its deposits carry federal insurance.

Paul Miller, a Friedman, Billings, Ramsey & Co analyst, said shareholders may be wiped out, citing IndyMac's decision to stop most mortgage lending and inability to raise capital. Miller cut his price target for the stock to zero from $1.00.


interestingly, no-one over on TF has noticed the B&B drama

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Investors dumped shares of Fannie Mae and Freddie Mac yesterday based on worries that the two pillars of the housing market could be forced to raise $75 billion of capital, potentially confronting them with an overwhelming burden and crippling already struggling financial markets.

Fannie Mae's stock price plunged 16.2 percent, to $15.74, and Freddie Mac's fell 17.9 percent, to $11.91 -- their lowest since 1995.

The sell-off came after a report warning that a proposed change in accounting rules could weaken Fannie Mae and Freddie Mac so severely that it "could possibly topple the already fragile capital markets."

Though it raised the specter of a calamity, the report by Lehman Brothers analyst Bruce W. Harting predicted that accounting rulemakers would make an exception sparing Fannie Mae and Freddie Mac.

"[W]e believe calmer heads will ultimately prevail," Harting wrote.

But an official at the Financial Accounting Standards Board, which sets accounting rules, said a first draft of the board's proposed change would apply to the two companies. The draft underscores that point by including an example that covers their business operations, the official said. The official spoke on condition of anonymity because the document is preliminary and has not yet been released for public comment.


A spokesman for FASB said the proposed change had a long way to go before adoption.

"All of what you're seeing out there right now is extremely speculative," FASB spokesman Neal McGarity said.

At issue are trillions of dollars in mortgage guarantees that Fannie Mae and Freddie Mac made but are not included on their balance sheets as assets or liabilities. FASB's proposed rule would require the companies to move the guarantees to the balance sheets, forcing them to hold additional capital to cover those obligations.

I'm sure political pressure will ensure those mortgages don't get included.

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Guest Shedfish

some more on IndyMac -


shares approaching penny stock territory



IndyMac faces rush to withdraw

Eric Dash - International Herald Tribune

July 9, 2008



Analysts expect IndyMac to file for bankruptcy

July 10, 2008

Depositors rushed to withdraw money from IndyMac Bancorp on Tuesday as problems continued to mount for one of the nation's biggest mortgage lenders.


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  • 396 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?

      • down 5% +
      • down 2.5%
      • Even
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      • up 5%

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