HSBC Finds $35 Billion to Bail Out Investment Outfits Caught by U.S. Mortgage Fallout

November 27th, 2007

WARNING: This is not a recommendation to buy, sell or hold any financial instrument.

“The other one I like short is HSBC. Just look how far above zero it is… Flying so high in the 80s.”

—Cryptogon, November 14, 2007

Cryptogon November 14 vs. Goldman Sachs November 27. Hmm. I’m going to have to get an expensive suit and a pinky ring to update Cryptogon. The current arrangement of boxer shorts and baby-spitup-covered T-shirt doesn’t maintain the right appearance for all this high powered financial analysis.

* chuckle *

Via: Guardian:

Some analysts believe there is worse to come for HSBC, particularly from its US home loans business Household. The bank has already set aside $4bn in provisions against its sub-prime mortgage business in the last year, but Roy Ramos, of Goldman Sachs in Hong Kong, believes a further $12bn in losses is likely to be incurred.

Downgrading HSBC to a sell rating, he said: “We point out that 13% of Household’s sub-prime loan book was in negative equity as of June, with another 43% with a current loan to value ratio of 90-100%. This implies that a full 56% of Household’s sub-prime loan book may be in negative equity if the US property prices fall by 10% across the board – our US economists expect an average 14% fall in residential property prices through 2008.”

Research Credit: Tochigi

Posted in Economy | Top Of Page

2 Responses to “HSBC Finds $35 Billion to Bail Out Investment Outfits Caught by U.S. Mortgage Fallout”

  1. Loveandlight says:
    November 27, 2007 at 4:31 pm

    The current arrangement of boxer shorts and baby-spitup-covered T-shirt doesn’t maintain the right appearance for all this high powered financial analysis.

    But that only cements your status as an maverick-iconoclast high-powered financial analyst! The only thing that’s missing is a big paper hat made from a grocery bag with magic-marker smiley-faces all over it. 😀

  2. tochigi says:
    November 28, 2007 at 12:47 am

    certainly looks like they’re going to try and keep the show on the road for at least another 10 or 11 months.

    after that, all bets are off.

    – Beijing Olympics
    – US elections
    – housing crash
    – banking crisis
    – US$ crash
    – derivatives meltdown
    – oil supply ceiling
    – food price inflation

    2009 = 1930 ???

    my crystal ball says: systemic failure in the US by 2013. game over.

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