Some housing bubble news from Wall Street and Washington. Bloomberg, "HSBC Holdings Plc, Europe's largest bank, will bail out its two structured investment vehicles, taking on $45 billion of assets to avoid a fire sale of bonds. SIV holdings have declined $75 billion since July, and net asset values have fallen to 70 percent from 100 percent in July, according to data compiled by Fitch Ratings. 'HSBC believes there is not likely to be a near-term resolution of the funding problems faced by the SIV sector,' the bank said."

"HSBC's rescue shows the world's second-largest bank manager of SIVs, companies that borrow short-term to invest in higher- yielding securities, isn't prepared to wait for the $80 billion 'SuperSIV' to start buying assets. Bank of America Corp., Citigroup Inc. and JPMorgan Chase & Co. have been working for more than two months to set up the fund initiated by U.S. Treasury Secretary Henry Paulson."

"The SuperSIV is 'is all good and well, but it's not big enough,' said Tom Jenkins, a credit analyst at Royal Bank of Scotland Group Plc in London. 'If you have a large SIV, you're going to need to find another solution.'"

"Former Federal Reserve Chairman Alan Greenspan is among those who say the 'SuperSIV' may do more harm than good by delaying the need for investors and SIVs to absorb subprime losses."

The Associated Press. "The viability of an SIV relies on its ability to continue borrowing money. Amid this year's flight from risk, lenders in the commercial paper market have frequently balked at letting borrowers 'roll over,' or extend, their debt. This is what is happening to most of the world's roughly 30 SIVs, which collectively manage about $320 billion."

"An SIV that cannot continue borrowing money would need to find cash elsewhere or sell its investments. Since mortgage debt has lost so much value, some types of mortgage debt are selling at less than 20 cents on the dollar, this would likely lead to losses for investors in SIVs."

"Earlier this month, bankers from Citigroup Inc., JPMorgan Chase & Co. and Bank of America Corp. announced an agreement on a multibillion-dollar fund to buy distressed debt securities. HSBC, whose SIVs are among the largest in the market, said it would not be participating in that fund."

"'As existing investors will continue to bear all economic risk from actual losses up to the full amount of their investment, HSBC expects no material impact to its earnings,' the company said."

"Loomis Sayles & Co. declined to invest after receiving one of 16 invitations for a personal meeting last week with current Fed Chairman Ben Bernanke, said Daniel Fuss, who oversees $22 billion as chief investment officer at the firm. The Securities Industries Financial Markets Association trade group extended the invitations, Fuss said."

"'It's so nice to get a personal invitation to go to Washington and have a one-hour visit with Ben Bernanke,' said Fuss, who decided participating wasn't worth the risk to his firm. 'Oh, boy, did I feel important for about 27 seconds, and then you smell a rat.'"

"Treasury spokeswoman Jennifer Zuccarelli said the department 'is pleased with the work the private sector is doing on a structure that is meant to improve liquidity' for all participants."

"Analysts including Richard Bove of Punk Ziegel & Co. have criticized the proposal because it may saddle new participants with losses created by their bigger rivals."

"'Why should we put something on our balance sheet that is going to result in further writedowns?' is how most contributors will respond, Bove said in an interview. 'The job of the Treasury isn't to go out and defraud investors.'"

"Boston- based State Street Corp. CEO Ronald Logue said Oct. 16 'you won't see us participating in any way.' Deutsche Bank AG, Germany's biggest, was awaiting more details, CEO Josef Ackermann said last month. Terms for participants haven't been publicly released."

"The fund's lack of disclosure makes it 'a necessary failure,' Bill Gross, manager of the world's biggest bond fund at Pacific Investment Management Co., said in an Oct. 31 interview. 'Transparency is what the Treasury and Fed are supposedly all about.'"

"JPMorgan's involvement in the fund is meant to help SIVs 'properly liquidate,' CEO Jamie Dimon said on Nov. 13. 'SIVs don't have a business purpose' and will 'go the way of the dinosaur,' he said."

"Bank of America 'has far more to gain down the road' with regulators by backing SuperSIV, said Tony Plath, a financial professor at the University of North Carolina at Charlotte, who expects the plan to fail. 'They are setting themselves up so they aren't criticized when this thing falls apart.'"

"Royal Bank of Scotland Group Plc CEO Fred Goodwin is proving that making acquisitions doesn't always improve profitability. Goodwin's bet that America's housing boom would supplement slower growth in the U.K. backfired this year as U.S. foreclosures rose to a record and the world's biggest financial institutions wrote down more than $65 billion for debt-related losses."

"'It seems to be a confluence of calamities,' said Neil Wesley, who helps oversee about 165 billion pounds ($340 billion) at London-based Morley Fund Management Ltd., which owns Royal Bank shares. Royal Bank dropped 37 percent in London trading this year."

"Goodwin said as recently as March when Royal Bank reported 2006 results that 'the U.S. is our single biggest opportunity.'"

"Santander SA is considering making an over 1 bln eur provision in the fourth quarter to cover the decline in the value of its stake in Sovereign Bancorp, Bolsacinco reported."

"The US subprime loans crisis and the dollar's depreciation against the euro have had a combined impact on Sovereign, the website said, adding that Santander now has accumulated capital losses on its just under 25 pct stake in the US bank of some 1.44 bln eur."

"Allianz SE shareholders have a new reason to rue the almost $21 billion purchase of Dresdner Bank six years ago: the collapse of the U.S. subprime mortgage market."

"Europe's largest insurer is trading at the lowest valuation in four years on concern subprime losses at Dresdner will erode profit. Dresdner had 575 million euros ($852 million) of writedowns in the third quarter when the bank accounted for just 6 percent of Allianz's total revenue, the Munich-based company's reports show."

"Swiss Re, the world's largest reinsurer, surprised investors last week by announcing a 1.2 billion-Swiss franc ($1.1 billion) loss on derivatives in October."

"'Swiss Re has dealt a heavy blow to the entire industry,' said Markus Engels, who helps oversee about $90 billion, including Allianz, at Cominvest Asset Management in Frankfurt. 'Currently nobody looks at valuations or fundamentals: the market panic doesn't allow it.'"

From FIN Alternatives. "Hedge funds sometimes get a bad rap in the U.S., but in Norway they are taking an epic beating following reports that four public municipalities have suffered huge losses because of hedge fund investments. The scandal involves a credit-focused Citigroup hedge fund marketed by Terra Gruppen and sold to local townships in the Scandinavian country."

"The subprime credit crisis in the U.S. hit the fund hard, and the municipalities, four of which invested a total of $739 million, were forced to place more money into the funds or face losing their investments."

"According to reports, one small town couldn't even make payroll for December and was forced to cut child care and elder care programs."

From Reuters. "JPMorgan Chase & Co Inc plans to cut about 100 subprime mortgage jobs in California amid falling U.S. housing prices and tighter lending standards."

"JPMorgan said it has reduced subprime originations and operations staff because of home price weakness and tighter credit standards. About 40 percent of JPMorgan's 2006 subprime originations would not be approved under today's standards, the bank said in a statement."

"The bank has discontinued, for example, all subprime home equity loans."

"Citigroup Inc., bracing for big credit-related losses in the fourth quarter, is looking to lower costs, which could mean another round of job cuts at the nation's largest bank."

"'We are engaged in a planning process in anticipation of our new CEO, and our business heads are planning ways in which we can be more efficient and cost-effective to position our businesses in line with economic realities,' said Citi spokeswoman Shannon Bell."

"Citigroup, which has about 320,000 employees, earlier this year reduced its workforce by 17,000 before the credit crisis."

From Marketplace. "When business is down, morale usually sinks with it. That's when it's time to hire someone with a shinier outlook."

"Doug Krizner: Morale in the mortgage industry has been in the pits. The Labor Department estimates nearly 100,000 jobs related to credit and lending have been lost. So how can managers pump up the workforce? Hire business cheerleaders. Marketplace's Jeff Tyler reports."

"Frank Candy, president of the American Speakers Bureau...says business with the mortgage industry is up about 20 percent. Frank Candy: 'The one thing that's gotten myself and a lot of my friends who are in this business through is believing in yourself and hope for a better tomorrow.'"

"Motivational speaker Chuck Carmen makes between $5,000 for a keynote and up to 25 grand for a two-day intensive workshop. In the past, he's done presentations for Countrywide and others in the industry."

"Even if they'd like a cheerleader, some companies can't afford it. Candy says companies want to hire motivational speakers -- but on the cheap."

"Candy: 'They're calling us and saying, 'We'd like to bring in a good speaker, but we don't have the budget that we used to have.' And so they're asking for more, and hoping to pay less.'"

"Carmen says there's life after subprime for mortgage brokers. If nothing else, they can earn commissions off the speculators buying homes in foreclosure."