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The Elephant in the Room.....

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The Elephant in the Room.....

Unread postby Pfish » Fri 07 Mar 2008, 09:29:22

Here is what the RE Meltdown is really about......

"Carlyle Capital leverages its $670 million equity 32 times to finance a $21.7 billion portfolio of residential mortgage-backed securities issued by U.S. housing agencies Freddie Mac and Fannie Mae."

http://biz.yahoo.com/ap/080307/britain_ ... pital.html
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Re: The Elephant in the Room.....

Unread postby peaker_2005 » Sat 08 Mar 2008, 14:21:46

Fuck.

I don't normally swear but DAMN! That shouldn't even be allowed.
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Re: The Elephant in the Room.....

Unread postby auscanman » Sat 08 Mar 2008, 14:40:58

Leveraging somewhere in the ballpark of 32x is probably normal practice when it comes to mortgage backed securities. Easy to see that a slight slowdown in real estate would be disastrous for them, much less the full-fledged real estate crisis we're now seeing.
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Re: The Elephant in the Room.....

Unread postby shakespear1 » Sat 08 Mar 2008, 14:53:29

Is this the same Carlyle that has ties to the Bush family?
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Re: The Elephant in the Room.....

Unread postby Homesteader » Sat 08 Mar 2008, 14:56:15

$this->bbcode_second_pass_quote('shakespear1', 'I')s this the same Carlyle that has ties to the Bush family?


It appears so:

snip:

"Shares in the fund, a listed mortgage-bond fund managed by private equity firm the Carlyle Group, were suspended Friday. The stock closed down Thursday almost 60 percent at $5.00 on Euronext Amsterdam."
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