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Old 09-29-2008, 07:45 PM
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FirstGarden FirstGarden is offline
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My Bank Just Went Under - Woohoo!

My bank just went under - Guess who?
Here's a hint..

WooHoo!





What exciting times we live in!
And as the saying goes..


"You ain't seen nothing yet!!"

So funny.. (or is it, really?) At work the other day, by the offices I saw a program posted on the wall..
for EXPERT GUIDANCE IN INVESTMENTS, from...
Merrill Lynch!

Imagine that? THEY just recently went under too, bought out by Bank Of America.

And now. among so many monolithic giants, my bank goes down too.
Wamu..

Woohoo!!!

WaMu Becomes Biggest Bank To Fail In US History


By MADLEN READ, AP Business Writer Fri Sep 26, 4:00 PM ET

NEW YORK - As the debate over a $700 billion bank bailout rages on in Washington, one of the nation's largest banks — Washington Mutual Inc. — has collapsed under the weight of its enormous bad bets on the mortgage market.

The Federal Deposit Insurance Corp. seized WaMu on Thursday, and then sold the thrift's banking assets to JPMorgan Chase & Co. for $1.9 billion.

Seattle-based WaMu, which was founded in 1889, is the largest bank to fail by far in the country's history. Its $307 billion in assets eclipse those of Continental Illinois National Bank, which failed in 1984 with $40 billion in assets; adjusted for 2008 dollars, its assets totaled $67.7 billion. IndyMac, seized in July, had $32 billion in assets.

One positive is that the sale of WaMu's assets to JPMorgan Chase prevents the thrift's collapse from depleting the FDIC's insurance fund. But that detail is likely to give only marginal solace to Americans facing tighter lending and watching their stock portfolios plunge in the wake of the nation's most momentous financial crisis since the Great Depression.

Because of WaMu's souring mortgages and other risky debt, JPMorgan plans to write down WaMu's loan portfolio by about $31 billion — a figure that could change if the government goes through with its bailout plan and JPMorgan decides to take advantage of it.

"We're in favor of what the government is doing, but we're not relying on what the government is doing. We would've done it anyway," JPMorgan's Chief Executive Jamie Dimon said in a conference call Thursday night, referring to the acquisition. Dimon said he does not know if JPMorgan will take advantage of the bailout.

WaMu is JPMorgan Chase's second acquisition this year of a major financial institution hobbled by losing bets on mortgages. In March, JPMorgan bought the investment bank Bear Stearns Cos. for about $1.4 billion, plus another $900 million in stock ahead of the deal to secure it.

JPMorgan Chase is now the second-largest bank in the United States after Bank of America Corp., which recently bought Merrill Lynch in a flurry of events that included Lehman Brothers Holdings Inc. going bankrupt and American International Group Inc., the world's largest insurer, getting taken over by the government.

JPMorgan also said Thursday it plans to sell $8 billion in common stock to raise capital. Its stock rose in midday trading Friday on the New York Stock Exchange, gaining $1.90, or 4.37 percent, to $45.36.

The downfall of WaMu has been widely anticipated for some time because of the company's heavy mortgage-related losses. As investors grew nervous about the bank's health, its stock price plummeted 95 percent from a 52-week high of $36.47 to its close of $1.69 Thursday. On Wednesday, it suffered a ratings downgrade by Standard & Poor's that put it in danger of collapse.

WaMu "was under severe liquidity pressure," FDIC Chairman Sheila Bair told reporters in a conference call.

"For all depositors and other customers of Washington Mutual Bank, this is simply a combination of two banks," Bair said in a statement. "For bank customers, it will be a seamless transition. There will be no interruption in services and bank customers should expect business as usual come Friday morning."

Besides JPMorgan Chase, Wells Fargo & Co., Citigroup Inc., HSBC, Spain's Banco Santander and Toronto-Dominion Bank of Canada were also reportedly possible suitors. WaMu was believed to be talking to private equity firms as well.

The seizure by the government means shareholders' equity in WaMu was wiped out. The deal leaves private equity investors including the firm TPG Capital, which led a $7 billion cash infusion in the bank this spring, on the sidelines empty handed.

WaMu ran into trouble after it got caught up in the once-booming subprime mortgage business. Troubles then spread to other parts of WaMu's home loan portfolio, namely its "option" adjustable-rate mortgage loans. Option ARM loans offer very low introductory payments and let borrowers defer some interest payments until later years. The bank stopped originating those loans in June.

Problems in WaMu's home loan business began to surface in 2006, when the bank reported that the division lost $48 million, compared with net income of about $1 billion in 2005.

At the start of 2007, following the release of the company's annual financial report, then-CEO Kerry Killinger said the bank had prepared for a slowdown in its housing business by sharply reducing its subprime mortgage lending and servicing of loans. Alan H. Fishman, the former president and chief operating officer of Sovereign Bank and president and CEO of Independence Community Bank, replaced Killinger earlier this month.

As more borrowers became delinquent on their mortgages, WaMu worked to help troubled customers refinance their loans as a way to avoid default and foreclosure, committing $2 billion to the effort last April. But that proved to be too little, too late.

At the same time, fears of growing credit problems kept investors from purchasing debt backed by those loans, drying up a source of cash flow for banks that made subprime loans.

In December, WaMu said it would shutter its subprime lending business and reduce expenses with layoffs and a dividend cut.
The bank in July reported a $3 billion second-quarter loss — the biggest in its history — as it boosted its reserves to more than $8 billion to cover losses on bad loans. Over the last three quarters, it added $10.9 billion to its loan-loss provisions.

JPMorgan Chase said it was not acquiring any senior unsecured debt, subordinated debt, and preferred stock of WaMu's banks, or any assets or liabilities of the holding company, Washington Mutual Inc. JPMorgan also said it will not take on the lawsuits facing the holding company.

JPMorgan Chase said the acquisition will give it 5,400 branches in 23 states, and that it plans to close less than 10 percent of the two companies' branches.

The WaMu acquisition would add 50 cents per share to JPMorgan's earnings in 2009, the bank said, adding that it expects to have pretax merger costs of approximately $1.5 billion while achieving pretax savings of approximately $1.5 billion by 2010.

"This is a definite win for JPMorgan," said Sebastian Hindman, an analyst at SNL Financial, who said JPMorgan should be able to shoulder the $31 billion writedown to WaMu's portfolio.

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Last edited by FirstGarden : 09-30-2008 at 01:13 PM.
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  #2  
Old 09-29-2008, 08:39 PM
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We will see this happening to more and more banks ! Yup!
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  #3  
Old 09-29-2008, 11:06 PM
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This is a good time to reflect upon the things in life that really matter.

The Eternal Value "System" (really just LOVE)..
Vs. the Temporal Value system.

Before I buy my cabin in the wood,
I will look deeply to the foundation
Whether it be rock, or concrete
Or merely dirt.

Aye,
I will look deeply thru life's canyon window
Down the lovely stone wall below..
Studying for opportunities to live less selfishly.
There is a river.
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Last edited by FirstGarden : 09-29-2008 at 11:46 PM.
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  #4  
Old 09-30-2008, 03:38 AM
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Well, I have my money in two banks, one is a local cooperative bank on Martha's Vineyard that never has risky loans. The other (with less money) is Bank of America.

Note to self: now is the time for investing, NOT saving!

I'm not too worried since I've already had the paradigm shift. Money is just money. Life and enjoyment and fulfillment -- not stuff -- That's where the good stuff can be found.

And I'm leaving Hungary at the end of October! My husband and I are going to save what we can for not more than a few months and then to move to Brazil. Our house there is paid and will keep us free from the reigns of monetary issues.

So this has all been good. Just helping me to keep my priorities in check!
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  #5  
Old 09-30-2008, 06:15 AM
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It's funny- About a year ago, one of the other posters at RFT (and here) and I
were talking about the inevitability of this happening, talking about buying gold and silver coin to insulate against bank failures and potential drops in dollar (USD) value- and many people were irate, called us alarmist, doom and gloom sayers, etc.

Really though, it is and was all about taking charge of your own health- your financial health and its sustainability.

I think it's fascinating that so many are scrambling and praying for band aid measures when what we really need to do is adopt a systemic approach to curing the US's financial woes. Our approach to the economy, if we are to look at health models- must mirror Chinese and holistic medicine more than the Western medical model. After all, Chinese medicine is about making energy flow correctly- which enables the body to access it's own power to heal and thrive. What is money, then, but a measure of energy- our energy in sweat, in ethics (money follows our politics and ethics via global trade, embargoes, etc), and values.

We live in interesting times. for sure. But if you are somewhere with access to fresh water, shelter, and patch of soil smaller than a driveway, and/or you can do something vital with your hands- you will survive anything.

What we are seeing is not a threat to our physical survival, but access to conveniences like nice cars, huge wardrobes, eating at restaurants 4 nights a week, etc. If we take an old "village" approach to seeing each other through, rather than "every man for him/herself"- we can make it through with strong roots of human solidarity as our reward.

Best to all of you and I hope you are all safe, and secure in these interesting times!
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Old 09-30-2008, 09:49 AM
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wyjoz wyjoz is offline
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Quote:
Originally Posted by Hypnotista View Post
We live in interesting times. for sure.

What we are seeing is not a threat to our physical survival, but access to conveniences like nice cars, huge wardrobes, eating at restaurants 4 nights a week, etc. If we take an old "village" approach to seeing each other through, rather than "every man for him/herself"- we can make it through with strong roots of human solidarity as our reward.

THAT IS THE BEST APPROACH TO SURVIVE ALMOST ANYTHING! but but remember??? some villages slaughtered the other villages???? hmmmm so where do we begin to create a REAL CHANGE?? FG mentioned post above/below

""""""The Eternal Value "System" (really just LOVE)..""""""""" Love Your 'neighbor'' as yourself and love unconditionally! Bible
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  #7  
Old 09-30-2008, 12:41 PM
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FirstGarden FirstGarden is offline
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Quote:
Originally Posted by Hypnotista View Post
It's funny- About a year ago, one of the other posters at RFT (and here) and I
were talking about the inevitability of this happening, talking about buying gold and silver coin to insulate against bank failures and potential drops in dollar (USD) value- and many people were irate, called us alarmist, doom and gloom sayers, etc.

Really though, it is and was all about taking charge of your own health- your financial health and its sustainability.

I think it's fascinating that so many are scrambling and praying for band aid measures when what we really need to do is adopt a systemic approach to curing the US's financial woes. Our approach to the economy, if we are to look at health models- must mirror Chinese and holistic medicine more than the Western medical model. After all, Chinese medicine is about making energy flow correctly- which enables the body to access it's own power to heal and thrive. What is money, then, but a measure of energy- our energy in sweat, in ethics (money follows our politics and ethics via global trade, embargoes, etc), and values.

We live in interesting times. for sure. But if you are somewhere with access to fresh water, shelter, and patch of soil smaller than a driveway, and/or you can do something vital with your hands- you will survive anything.

What we are seeing is not a threat to our physical survival, but access to conveniences like nice cars, huge wardrobes, eating at restaurants 4 nights a week, etc. If we take an old "village" approach to seeing each other through, rather than "every man for him/herself"- we can make it through with strong roots of human solidarity as our reward.

Best to all of you and I hope you are all safe, and secure in these interesting times!
Well said as usual, Hypnotista

I like what you said about the Chinese and holistic medicine. And my first thought was.. if only the powers-that-be (who created this mess) could adhere to such a philosophy! Or at least get out of the way. I believe that capitalism was a system that worked well early on, and that we have really lost touch as our inter-village values were gradually trampled under by the forces of global hyper-capitalism. Long story there.

And I always attribute the socio-economic/political ills of societies to human nature above anything else. I think the West can take many lessons from the East. And should. And the East can take many lessons from the West too - and in some cases.. a lesson on how NOT to be. For they too, being human (and inherently no different) could be overtaken by the same.

Great post, Hypno.
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How long can you print money?


Last edited by FirstGarden : 09-30-2008 at 12:57 PM.
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  #8  
Old 09-30-2008, 12:48 PM
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Quote:
Originally Posted by wyjoz View Post
THAT IS THE BEST APPROACH TO SURVIVE ALMOST ANYTHING! but but remember??? some villages slaughtered the other villages???? hmmmm so where do we begin to create a REAL CHANGE?? FG mentioned post above/below

""""""The Eternal Value "System" (really just LOVE)..""""""""" Love Your 'neighbor'' as yourself and love unconditionally! Bible
Wyjoz -

Chief Red Cloud has decreed that his braves take gift to all neighboring tribes, expecting nothing in return.

Furthermore, braves will escort squaw little feather Aisah as she dance and sing and twirl around on the dirt path and cheer up all the neighboring tribes in the spirit of kindness and goodwill.

Woo woo, Waa waa!
Hoo hoo Haa haa!

"Good news and glad tidings to all neighbors!" sing squaw little feather Aisah at behest of her chief.

So chief Red Cloud hath decreed.

Little feather Aisah, where art thou?
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How long can you print money?


Last edited by FirstGarden : 09-30-2008 at 01:06 PM.
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  #9  
Old 09-30-2008, 12:52 PM
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Quote:
Originally Posted by FirstGarden View Post
Little feather Aiseh, where art thou?

little feather Aisah might come out and play ''''' Woo woo, Waa waa! ''''
with us in October sometime !!!
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  #10  
Old 09-30-2008, 12:59 PM
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Quote:
Originally Posted by wyjoz View Post
little feather Aisah might come out and play ''''' Woo woo, Waa waa! ''''
with us in October sometime !!!
Yes,yes, come out & play, little feather Aisah.
Chief Red Cloud summons you.




OL' SOUR PUSS CHIEF RED CLOUD
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Last edited by FirstGarden : 09-30-2008 at 01:05 PM.
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  #11  
Old 09-30-2008, 01:39 PM
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Eva Eva is offline
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Quote:
Originally Posted by FirstGarden View Post
Well said as usual, Hypnotista

I like what you said about the Chinese and holistic medicine. And my first thought was.. if only the powers-that-be (who created this mess) could adhere to such a philosophy! Or at least get out of the way. I believe that capitalism was a system that worked well early on, and that we have really lost touch as our inter-village values were gradually trampled under by the forces of global hyper-capitalism. Long story there.

And I always attribute the socio-economic/political ills of societies to human nature above anything else. I think the West can take many lessons from the East. And should. And the East can take many lessons from the West too - and in some cases.. a lesson on how NOT to be. For they too, being human (and inherently no different) could be overtaken by the same.

Great post, Hypno.
I agree. I love how much I can learn from you all on this forum. Such poignant comments!
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Old 09-30-2008, 01:56 PM
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.................. if only the powers-that-be (who created this mess) could adhere to such a philosophy! Or at least get out of the way...................



I wish wish that this was so ! If someone is incapable of thinking/caring for themselves yes, someone please come and HELP and the rest of us???? powers that be; GET OUT OF OUR WAY !
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  #13  
Old 09-30-2008, 06:43 PM
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Yoo hoo. Aisah. Where you be?
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Old 10-01-2008, 02:44 AM
Lightlover Lightlover is offline
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Eva, is there a special thing you are gonna do In Brazil..

I am always interested in inspiring stories from people, sunlover as I am.


LL
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  #15  
Old 10-01-2008, 04:58 AM
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Welp, I feel trapped by my current conditions. I have a well-paying job but also have expenses (living alone in apartment here in Budapest) that come from that because I work from home and have to maintain a peaceful office space. And I'm trapped in the world of conference calls and nonsensical corporate crap.

In my job now, I oversee a lot of the marketing but also deal with our strategies (with the website, design templates unique to our marketing, SEO, etc.)... I would LOVE to have my own business doing some of those things. My husband is from Brazil and is well respected in his local area ('cuz he's such a charmer methinks)... so I would already have his networking for the startup.

And if it doesn't go well enough, then no worries. I don't need much money if our things there are paid for! And I could always teach English.

Maybe we could just live on mangoes, avocados and sunlight! LOL. We have plenty of those things on our property, but not much else. I need to get a garden going as soon as we get there.

That's the master plan for now. I'm still working on getting my plane ticket changed to get back to the US by the end of the month, though. It's harder than it should be because I booked it online.

LOL, more than you wanted to know, right?
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