The Fed rate cut this week came from and emergency meeting when the Dow futures were down almost 500 points. The rate cut came just in the nick of time stemming a stock market crash…or so we’re told.
Yes…at least that was how it was reported in the media… a crash as bad as Black Monday two decades ago…and we were 60 minutes away. Tick- Tock…
ELoan Mortgage bailed out on the subprime market about a year ago. Back then ELoan Mortgage was the first of many lenders to turn their backs on the subprime borrower.
As I predicted a few posts back, the bruised credit borrower would be left out in the cold the minute the big boys figured out the subprime loans they pushed so feverishly just 18 months ago are ticking time bombs ready to explode.
With the Fed jumping in on Friday to calm the markets it would be easy to be fooled into thinking the worst of this financial irresponsibility is over…it’s only just begun!
Merrill Lynch yesterday downgraded the stock of Countrywide Home Loans (CFC ticker symbol) and speculated on the analyst call just how they could go bankrupt. First this was irresponsible and reckless on the part of Merrill…or was it?
Since the call yesterday a lot has happened:
1. The stock has fallen about 10 points.
Remember this date: August 3rd, 2007. This is the day Jim Cramer melted down right along with the subprime home mortgage market and Bear Stearns. I wrote an article about a month ago on the Bear Stearns implosion due to subprime home mortgage exposure, forecasting their demise, and here it is.
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