You Lucky Bastards: FMD

Quote from Port1385:

This is the best advice on this board. If they cant sell their loans, then they just might go to zero or come very close while listed on the pink sheets.

When will they start selling their loans and then to who? Will they start selling them tommorrow? Next month? Six months?

Im betting that they cant get it straightened out at least until 2009 and, by then, First Marblehead will be trading somewhere south of $1.00 if its not on the pinks. Just then and only then will this thing become a buy once more if it doesnt fall into bankruptcy.
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Lol if Stcktrder doesn't like it that's a positive, is there a more ridiculous poster to ET? I've had him on ignore for so long but people can't help but keep quoting him.

Where are students going to get their money from? It is that simple. If it is all going Federal then you are right FMD is toast unless they can pull a Key bank style clone but I'm not holding my breath for that. If the private market is resurrected in any way then FMD is going to do very well. I have less than 4% of my account (not my net worth, seems like for most ET posters account and net worth amount to the same thing) in this student loan play between FMD and SLM and obviously expect to be paid for my time and money. Time will tell. Hopefully some of you who doubt this play will still be around in the Fall so we can see how it all turned out. If you only have a couple of $K to rub together and need to turn it over several times a month to eat then yes I agree this is probably not a trade for you (then again perhaps it is if you are one of the oft mentioned 95%). If you never get close to using all your BP then putting a few % of your account in to this play should outperform the market at the very least. Will resurrect this thread in the fall and we can all compare notes or eat crow as the case may be :D
 
My experience is that a 3 dollar stock can easily go to 2 or even 1 dollar. If a 3 dollar stock drops to 1.50, then you have lost 50%.

All I know is that the loans they are packaging up are not selling and have not sold 1 of them since September. How much longer can they exist with this kind of business model?
 
Quote from Port1385:

My experience is that a 3 dollar stock can easily go to 2 or even 1 dollar. If a 3 dollar stock drops to 1.50, then you have lost 50%.

All I know is that the loans they are packaging up are not selling and have not sold 1 of them since September. How much longer can they exist with this kind of business model?
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True enough but this is not your average $3 stock that has been done in by a bad drug or mismanagemnet, it is a bet on an entire industry:the private student loan industry. My bet is that it will not disappear for good.
 
Quote from BullAlert:

Truth hurts, doesn't it? What kind of idiot are you to think anyone can guarantee anything 100% of the time? I never made any STUPID FUCKING claims-YOU DID. Trolls like you love to start threads posting these grandiose GAMBLES, hoping and praying their longshot dogshit goes in the direction they predicted so their ego can be stroked by people like themselves who they will never meet.

FUCKING LOSER
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You are a first class asswipe.

Investing is about risk/reward. FMD had an enviable business model, a solid balance sheet, and was caught up in the credit markets seizing up - a credit market seizure that is now so bad that it is causing municipalities to default on their general and special debt obligations.

And then, the insurer of private student loans, TERI, filed for bankruptcy protection, leaving FMD in the unenviable position of having uninsurable loans, and not being able to insure future loans, thus not being able to sell said loans into the secondary market.

Having their pool of student loan purchasers dry up was a big hit; the TERI bankruptcy was an even bigger one, as it reduced the potential for a resumption of bundling into secondary markets any time soon. Neither event was exactly predictable (right, I know that you knew exactly how everything was going to play out, and made billions shorting financials at just the appropriate time).

There was little element of 'gambling' involved in representing FMD as a potentially profitable trade or investment candidate at the time I mentioned it -

- to think that another insurer would be found, or that FMD would be assimilated into the lending unit of some of its biggest clients (Bank of America or JPM or Citizen's), was not a tall order.

Hence the risk/reward analysis.

You are an idiot beyond compare for stating such an asinine opinion.

To top it off, FMD is far from down. As credit markets normalize, which they will, and with enough cash accrued, minimizing expenses, FMD very well may live to fight on.

When you grow a pair, and reach puberty, toss out a couple of your picks so that we can all sit in awe and amazement in the shadow of your genius. I'm sure every stock you mention will rise to nosebleed levels within mere months of the utterance of the ticker symbol from your lips.

We all know you're batting a thousand.
 
I am currently long just 300 shares of FMD, and am willing to lose those shares if FMD goes belly up. My goal is to make at least a 100% return for my risk.

I did much better with SLM which is already up from my buy price. Good luck to any of you buying massive amounts of FMD.
 
Just wanted to check in to see whats up. Looks like the entire market is up and my portfolio going higher. FMD at 3.08. Now its hanging onto 3 but just barely after a little wiggle in the high 2s.
 
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