I get up and make my coffee and look at our blog. I turn to the family and say: "Guess what Gimleteye wrote about?" And most of the time the correct answer is "global warming." And I think: Yawn. Not again. Is my fellow blogger crazy?
In my house we aren't smug about Gimleteye's choice of subject matter anymore. Not after reading the Rolling Stone article about Miami.
The problem has always been that the subject of Miami's future doom was explained dryly with maps and charts. Groan. This article kicks you in the gut (or should I say ass). I now fear as Gimleteye does for Miami's future. Angst to the max!
If you remember, Gimleteye wrote incessantly about the real estate bubble since we started this blog in 2006. I got tired of that too. Until the bubble burst. He knew it was coming, he predicted it before anyone else. And, he wrote about unsecured/sub-prime loans and other things I had no interest in, long before it was on anyone's radar screen. He wrote about 400 posts that said things like:
Most banks are sitting on losses they are not disclosing because they don't have to - they only time they are forced to truly mark a loss is when they truly sell an asset at a loss, everything else has wide discretion... thus yes, they are in varying degrees of insolvency, or at least in much worse shape than they report. Plus as long as they hold securitized assets predicated on this, or similar collateral, they can mark those assets at almost any level they feel like (since the FASB allows non-liquid securities to be marked at the discretion of the holders), which has the effect of creating an average value higher than it should be given the declining loans. Does the fed get this? no - they are doing the same thing with the bank assets they hold.
Maybe we should pay more attention to Gimleteye's predictions. He sounds the alarm and even I can be deaf to it so, again...
Gimleteye never cries wolf!