Wednesday, April 15, 2009

April Beige Book Report

Some CRE snippets from the report:
"Nonresidential real estate conditions continued to deteriorate. Difficulty obtaining commercial real estate financing was constraining construction and investment activity. Bankers reported tight credit conditions, rising delinquencies, and some deterioration of loan quality.

Commercial real estate investment activity weakened further. Contacts said a decline incredit availability and markdowns on commercial property were keeping buyers and sellers onthe sidelines.

Commercial real estate lending continued to decline. Credit availability generally remained very tight across regions. A number of Districts reported deteriorating loan quality and rising delinquencies for all types of loan categories. In particular, several reports noted more stringent requirements for commercial real estate loans due to worries of worsening loan quality in the sector."
Perfect timing for Goldman Sachs to put SPG on their conviction buy list. Nothing like having more visibility than the federal reserve... unless you are the federal reserve of course.

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Anonymous said...

Steve Liseman just told me that it was a "great report" really postive.

What more do i need to know?

Anonymous said...

Is anyone selling Copper here at 22145?

Anonymous said...

CNBC suggests that the tone of the beige book is quite a bit better than recent ones - they suggest that it signals a bottom in the economy has been reached. They go on to emphasize that the anecdotal data contained in the BB is much better than in recent memory. As if to corroborate their optimism they point out that the Dow has tripled its gains since it was released.

What is amazing is that they made those pronouncements within minutes of its release.

Anonymous said...

lol anon. was about to point out that liesman's conclusion came within 83 seconds of it hitting the fed website... CNBC has got the inside scoop as always. way to go gasbag

Anonymous said...


I would be a seller. But not going short yet.

Worried about Q1 Chinese GDP tonight and any further stimilus announcements.

Anyone else find these chinese numbers confusing: March yoy industrial production +8.3%,
March yoy electricity consumption

Anonymous said...

these reports are usually released to media FAR in advance so they can write stories on them. They are embargoed from releasing their story till the exact time the data comes out.

is this a surprise to people?

Anonymous said...

Yes, I am shorting copper up here, Shanghai vs. Lme arb trade is still wide open esp with VAT levied in Shanghai 2-3 weeks ago...but as the gap fills, you will notice we go back to huge inventory builds, capacity has not fully been pulled off on copper, AND most importantly , the scrap supplies will hit the mkt the longer we stay above 1.80+ lbs/
Any "inflation premium" will dissapear as well, as there is probably no CPI blow up coming anytime soon over the next 1-1.5 year, incomes are collapsing, and core will prob go negative.
The biggest risk for deflation is actually next year...
"hump" shaped recovery as Jan Hatzius talks about.

As for robust Chinese Demand....
the greater risk here is that rest of the world demand will pull China down more substantially (instead of the other way around)

looking for 1million + inventory on copper before year end..will put us 1.00 on the spot

Anonymous said...


Anonymous said...

Don't get me started again on Steve Liesman.

It's like fluttering the red cape in front of the bull.

It really is.

Anonymous said...

One of the worst Beige Books in history, S&P's drops 8 maybe 10 points.

Get the picture?

John said...

The line on lack of available credit for acquisition and construction is kind of funny. I have said a number of times that we are oversupplied in almost all space types. There is no such thing as "a good project that can't get construction financing". CRE developers are always going to think their projects are good, but they can't see through the bias.

The credit crunch is providing a much needed stop to construction activity.

I've posted on this a number of times, but most recently here:

Anonymous said...

The Obama administration named on Wednesday a former U.S. Justice Department official who was "border czar" during Bill Clinton's presidency to lead its efforts to crack down on drug-related violence along the U.S.-Mexican border.

Czar sounds so Russian, wonder how long it will be before this little banana republic becomes a roach motel.

Anonymous said...

why would one want to go long SPG right now?

Anonymous said...

Anon said : "Steve Liseman just told me that it was a "great report" really postive.

What more do i need to know?"

Or the market for that matter --> see close --> Bestest report evers!@ I woke this morniggi and lived till 4

No srsly, great stuff, amrite?

I just rem that the market can be .... longer than my account can be right. suxs

Glad I hate margin.

5U said...

I find the GS upgrade of SPG to be genius.

SPG is the largest component of SRS and IYR and has a 15% short interest.

Rising tide lifts all boats

GS lost $800 million of CRE

I am sure with these stock moves GS is in motion to try to line up some M&A in the space PHM/CTX style...stock swaps!

Is the market so illiquid that it can be maniuplated...but of course! Geithner is pals with Goldman. As is Washington DC. Isn't strange how Paulson has received ZERO criticism for pushing Washington D.C. for deregulation back when he was CEO of Goldman?

It's good to be a Golden Scrote!!!

Anonymous said...

FWIW - Chinese numbers may have been impacted by the timing of Chinese new year

Anonymous said...

FWIW - new condo construction is still sprouting up all over Brooklyn.

whether they will get filled or not is a different story.

patrickthepainter said... is a dis-information site put up by Goldman, to tell us all the obvious facts, that we already knew, thereby distracting us from the

real conspiracy of Goldman along with others to crash every stock market in the world in 2008. Bedsides the Trillion dollars to be made, crashing the market,

Goldman saw a chance to eliminate their competition, and consolidate the small regional banks into bit size pieces with the help of the FDIC, not to mention, get

sweeping new powers for the FED and Treasury, under the guise of new regulation. Lastly, the FED Reserve Bank, decided the the CDS game had gotten way to big and

unruly and it was time to bring in all the chips back to the nearest Fed Bank!

By 2007, the CDS market had ballooned to over 100 trillion dollars and it was time, to rein in this monster. Even though sub-prime had constituted only

5% of this mess, it would make a great scape goat, to feed to the angry public when the crash happened. The public and media were already in the dark

of course, because how technical finance terminology had gotten over the years. Not knowing the difference between a bank and merchant bank is killer. Thinking a

derivative is actually an asset (thanks to TARP) and so on. So, of course Goldman has declared a nominal loss for the year, and stashed trillions somewhere to be realized in

the future. .
I am sure it will show up soon, but in the mean time here is why I think Goldman Sachs, along with others are the main conspirator(s) in crashing the market.

In 2007, Goldman shorts the ABX (sub prime) index and makes about a Billion dollars doing so. Yet, one year later Hank Paulson who becomes US Treasury,

tells Bush and Congress that "he didn't see it coming." (the real estate thing) even though he was just CEO of Goldman one year prior to their bet against

the sub prime real estate market. PAulson was a visionary for the industry. He didn't forget his vision nor put Goldman's long term strategy on hold because he

became a public servant. Goldman, simply lent Paulson to the government for 2 years. Paulson's loyalties lie with Goldman. Hank Paulson most certainty

knew that sub prime would tank before he went to the Treasury. Any Joe with a small brain knew that sub prime would blow-up, but what we didn't know

was that Wall ST had been collateralizing it all these years.

This is very important because if Hank Paulson knew that sub prime would tank, then that means he already had the "bailout plan" deceptively known as TARP

in his back pocket before he got the post as Treasury. I think Goldman new that heavy shorts on ABX sub prime index could be enough to get the avalanche started.

Flash forward to July of 08, and a we see a massive sell off in the commodities markets with the media blaming it on a slowing economy. It was really Goldman's people at

the Exchanges that raised requirements across the board, forcing many out of the market. This really helped the crisis to blaze along. Commodities/Futures would lose 50%-

75% over the ensuring months. Goldman even cornered the oil market in July. Goldman publicly announces OIL forecast of $200 but are shorting it at the same time, to get the

public to buy when they are dumping.

Goldman's former employee Cristopher Cox, headed the SEC for the many years. It was his job to make sure that regulations were very lax, and
employees did not to follow up cases. Cox would also raise margin requirements on equity products when the time was right. Cox would also tip off Goldman as

what other firms were "holding" and Goldman was known to gun down these positions.

Flash forward to the September, and we see Hank Paulson take Lehman Bros into a private room in the White House, where he was executed. The President was the only

witness. I'm pretty sure Hank new that this would rattle the markets. Just as he wanted! And the the perfect alibi, "didn't have the legal authority."

Boy, how that changed a week later, with the AIG bailout. If this didn't get the avalanche going, Hank decided he would have his contact at Moody's cut AIGs'

rating. His contact is Warren Buffet who owns 20% of Moody's and recently threw 5 Billion at Goldman. By cutting their rating, AIG was forced to

find Billions overnigth. A bit impossible, even for Wall ST. It would never happen. Not a chance!, But wait, Here comes the government to save the day! Yes!

Is that HanK Paulson over there with a $700 billion plan?

"Hank, That plan looks worn out like its been in your back pocket a few years?

It actually has says Hank. "You can barely read the part "To Big to Fail." Alright, enough with the jokes.

Hank knew that there would be this tug-a-war between the markets and DC while he pitched his plan. After the market had fallen to Goldman's likening,

it was time for Hank to really press urgently and threaten Congress to pass it. Martial law and great depression are the words he used. They pass the bill and market rallies

900 points. Then you have Jim Crammer from Mad Money, after watching the market crash for 11 days in a row, tell the American Public to sell everything. Did I mention
Crammer is a former Goldman partner. If the market rebounds this year, then you know he is "in" on the conspiracy.

It also would hold that Crammer is just a tool for Goldman to abuse the public with, because he never makes any sense when he talks.

Since AIG slipped through the biggest loophole ever, not to be regulated by the CFTC and SEC because they are an insurance company, that loophole was

well known 5 years ago, which leads me to believe that AIG was hank picked to be the fall guy at the inception of this conspiracy 5 years ago. It was their

mission, and with Goldman advising them, to get so big, as to be "to big to fail." Possibly even Citigroup. When you look at how large Citi got relative

Goldman, Morgan and others, 10 times as big, it makes it seem they are a fall guy. If the smarter guys at the table new way in advance about sub prime, they

probably were force feeding it to the dumber guys at the table. Rubin, former Goldman, sat on Citi's Board. Maybe as a Trojan Horse? Goldman has a

habit of looking at others books and either reneging on either a merger deal, as they did with Morgan Stanley, or just straigth up fucking you if you were in the he oil market,

as experienced by billion dollar firm Semgroup, bankrupted in July 08.

The reason I feel that this was conspired 5 years ago is that is when sub prime was invented and the idea of using "sub prime" as a scape goat when it was time

to rein in the 100 trillion dollar CDS market. Did I mention the market was unregulated thanks to efforts of Rubin, Summers, Ghram and Paulson in the 90's.

It's highly possible that Freddie Mae and Freddie Mac were also made to be fall guys. What if they were influenced, or bribed by the bankers to get as big as possible.

We all know Indy Mac, specialized in LIARS or Ninja Loans. We also knew that Wall ST had a voracious appetite for pooled loans of any quality. They couldn't fill

the CDS boxes fast enough. The regional small lenders couldn't keep up with the demand from Wall St. Even though it was junk, it didn't matter. Moody's would stamp AAA

on the box, and AIG would see insurance against "anything in the box."

Check this out - What are the odds that the 2 most eventful (events) in our lifetime(s) happened on the 1st and Last years of the President's watch?

That would be 911 and the Credit Crisis.

Looks like Bush was made to be a fall guy too! That would explain why Goldman gave Obama $700 million. Yes just million. Wow, haven't used that word in a while.

Lets rehearse. It goes like this. Million, Billion, Trillion, Quadrillion. Only merchant bankers get to use the last word.

Maybe Hank Paulson will be on the 1000 dollar "Amero." who knows.

The sadest part is that all this didn't have to happen. The real economy was doing fine, until a few merchant bankers created a crisis, which would insure all the

stock markets to fall, which would hit the real economy because people were afaird because half their retirements disappeared?

The real economy was dragged into a depression because a Wall ST poker game got out of hand. It wasn't Wall St, crashed because the ecoonomy was slowing due to sub prime.

Thats what they want us to believe.

Patrick the Painter
my Toubled Assets need Relief too!

Anonymous said...

The PatrickThePainter Manifesto... LoL

Anonymous said...

Buy SPG if you know that the financing is available and ready for SPG and a promise with a wink and a nudge from General to sell choice real estate at an extreme discount once they file----no Chinese walls necessary when you are always in a catbird seat and immune from prosecution.