Wednesday, February 27, 2008

not everyone is shunning mortgage debt.....

a growing number of investment firms, including blk, fig and ozm, are scooping up residential mortgages at steep discounts in the hope of forcing payments by adjusting loan terms and/or reselling them for a profit. this debt is not as toxic as it seems right now! these firms, and yes - some were early to these investments, are not stupid - they have the smarts and patience to see through the smoke. unlike some beat reporter for businessweek or cbs marketwatch, for example. these instruments will find a market and a value; there will be writeups in the future as writedowns - as mandated by accounting standards - have become excessive. i'm thinking that by the fall of this year, or maybe this time next year, things will look much rosier for banks and brokerages.

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