The Doctor Is In The House

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Deutsche Bank is holding a conference call right now called on the "Implications of the GSE Rescue Plan." They've mentioned that "Dr. Greenspan" will be speaking 5 times. While I'm on hold, let's guess what he's going to say, and whether or not he's calling from the tub, as is his wont.
10:36: "This is an off the record call." Awk. What's the worst they can do to me? (Nervous laughter.)
10:40: "De facto nationalization...But not full nationalization-- the effect of Secretary Paulson's plan is essentially to create an almost but not quite full faith in credit situation."
10:42: Tranquilizer gun time:
"The case is critical because the financial crisis globally is best described as single issue in the price of homes in the U.S."
"Equity in those homes serve as the ultimate collateral."
"So long as price of homes is ambiguous, clarity is difficult to gain in this type of market."
10:47: "Inability to close very critical LIBOR to overnight index swaps spreads is indication that there is a frozen structure in here which can only be resolved by subbing sovereign credit for private credit."
10:50 Get excited: "Something like this is going to occur ever 50 to 100 years."
10:52 "Capital is not the issue!" "Nor is the chinaman!"
Questions and Answers:
Q: Are we at the bottom or close to the bottom?
A: I love that question. I wish somebody had the answer to that.
At this point someone has attached a mic to his his receiver and placed it next to the keyboard and is BANGING THE FUCK out of the keys. Greenspan screams at whoever is doing this and for a second I get scared it's me. It's not but wow.
Q: Didn't hear it. Am working from my apt. today and calling into this thing from my Blackberry, which is getting really hot. Had to put it down for a second. Caught the answer though, which sounds dark:
A: If we leave these wounds open, THEY WILL ERUPT AGAIN.
Q: What's your vision for Freddie and Fannie in the long run?
A. They should be nationalized (effectively what has been done). After the crisis, split them up into a number of different types of institutions and sell them off into the market.
Q. You're feeling better?
A. No. I'm feeling a little less worse.
Q: Given that agency spreads have tightened approximately 40 basis points, could you comment on foreign central bank's appetites to buy GSE debt at these levels?
A: The best way to find out would be to ask them. [He goes on, but as his official editor for today, I unliterally decide to end it there, sparing you the sensation of having your will to live sucked out, and making him sound bitchy and dismissive, which is preferable to obtuse, is it not?]

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