More Mortgage Meltdown

A clear look at how to capture investment profits during difficult financial times The U.S. economy has become crippled by the credit and real estate catastrophe. Even though we've all been affected by the calamity and have heard no shortage of news about it, it still seems unfathomable and utterly incomprehensible to most people that the actions of certain mortgage brokers, bankers, ratings agencies, and investment banks could break the economic engine of the world. Now, for the first time, and in terms everyone can grasp, noted analysts and value investing experts Whitney Tilson and Glenn Tongue explain not only how it happened, but shows that the tsunami of credit problems isn't over. The second wave has yet to come. But if you know catastrophe is looming, you can sidestep the train wreck-and even profit. You just need to understand how bad times present opportunity and where to look. More Mortgage Meltdown can help you achieve this goal. The book Breaks down the complex mortgage products and rocket-science securities Wall Street created Addresses how to find investment opportunities within the rubble and position your portfolio to take advantage of the crisis Explains exactly how the combination of aggressive lending, government missteps, and Wall Street trading practices created the perfect economic storm Shows you why the crisis is not yet over and what we can expect going forward More Mortgage Meltdown can help you understand the events that have unfolded, and put you in a better position to profit from the opportunities that arise during these tough financial times.

Acknowledgments vii Introduction ix Part One: What Happened and Why, Where Are We Now, and What Does the Future Hold? Chapter 1 What Happened during the Housing Bubble? 3 Chapter 2 What Caused the Bubble? 29 Chapter 3 What Are the Consequences of the Bubble Bursting? 49 Chapter 4 What Are the Problem Areas? 67 Chapter 5 What’s Next? 97 Part Two: Profiting from the Meltdown Chapter 6 Advice for All Investors 121 Chapter 7 A False Alarm on Derivatives 149 Case Study: Berkshire Hathaway Chapter 8 A Battered Blue Chip 179 Case Study: American Express Chapter 9 Bottom Fishing in Microcaps 199 Case Study: Resource America Chapter 10 Opportunities in Pools of Distressed Mortgages 215 Case Study: Long Beach Mortgage Loan Trust 2006-8 Chapter 11 An Introduction to Shorting 227 Chapter 12 A Case of Questionable Reserves 241 Case Study: MBIA Inc Chapter 13 An Ill-Fated Acquisition? 265 Case Study: Wells Fargo Conclusion 287 Notes 291 Index 299