jpmorgan warnns about anz first wave, page-14

I think we all use way to many emotional references, it colors clear analytical thinking .

My influence is not so much ANZ focussed but global market focussed, if for instance the credit default, monoline and various other debt and bond market were looking healthier I wouldnt be so concerned

what these global markets are telling us though is of extreme concern, so troubling that we almost pass it over because it seems to unbelievable

who would have expected Bear Stearns to die in a few weeks, who would have expected almost all the monoline insurers to be technically insolvent, who would have expected Citi, Lehman, Wamu, Countrywide (and a basket of others) to be in so much trouble

why I sound so shrill is not some vendetta against ANZ , although yes I thought their performance over Opes was pretty poor,its that because they seem to be up to their armpits in the most dangerous game in the market and they are in deeper than any of the other banks, maybe they can manage it but then again , judging by the performance ytd maybe they cant

if the credit default meteor misses planet earth then we can all breath a sigh of relief and get back to what we were doing before the scare, but make no mistake it hasnt passed yet and we are no where near all clear

the truth is not a single person here can really assess the business risk we face with ANZ, those of us that have read the fine print know that ANZ are completely opaque as the level of debt risk they face, we dont know who their counter party exposure is to, who their monoline exposure is to , where their underlying debt exposure lies, all we know is they have a mountain of credit default swap exposure to SOMEONE, are they claim that this risk is mitigated by diversification, but this diversification is (as Buy and hold reminds me) mostly with Australian counter parties

so we have 47B worth of credit default swaps held with mostly Australian entities ? and this is compared to CBA with 5B and we are in a global credit tsunami and folks want to point the finger at me for being harsh on ANZ?

are folks for real?

there is nothing doom or gloom about it, the titanic is at sea and its only going to be really good luck , calm seas and no ice bergs that will see her stay afloat.