The “Great Unwind” of 2008 continues, and it looks as though it is trampling
every sector in its path. Next week promises to be another high-stakes week
for stocks, especially with a Federal Reserve meeting and the release of the
much-anticipated GDP number, which could certainly come in a whole lot worse
than the 0.50% decline most economists are expecting. The gloom and doom is
pervasive, and we all know that it is that type of fear-laden atmosphere that
lays the groundwork of a new bull market. We all also know that the stock
market is NEVER that simple, and it has always had a tendency to barbeque
those that expect the conventional wisdom to occur!

One thing the bulls have going for them, though, is the fact that we have now
had WEEKS of fear, panic, and loathing! Markets might not have a gut-wrenching
crash-like bottom, but they do eventually become exhausted! The low we saw in
October of 2002 was followed by two subsequent bottoms, which ultimately
formed a loose-looking triple bottom. The subsequent rally lasted for FIVE
years; so again, remember that markets do eventually change! The current route
is as bad as any the Gorilla can remember, and he does clearly remember the
big dive in October of 1987! They were not nationalizing banks back then, so
chalk that one up as a big worry for this current selloff!

Credit Crunch Rocks Bain, as Funds Fall Up to 50%

essica Marie Alba (born April 28, 1981)[1] is an American television and film actress. She began her television and movie appearances at age 13 in Camp Nowhere and The Secret World of Alex Mack (1994). Alba rose to prominence as the lead actress in the television series Dark Angel (2000–2002).[2][3] Alba later appeared in various films including Honey (2003), Sin City (2005), Fantastic Four (2005), Into the Blue (2005), Fantastic Four: Rise of the Silver Surfer and Good Luck Chuck both in 2007.
Alba appears on the "Hot 100" section of Maxim and was voted AskMen.com's number one on their list of "99 Most Desirable Women" in 2006, as well as "Sexiest Woman in the World" by FHM in 2007. The use of her image on the cover of the March 2006 Playboy sparked a lawsuit by her, which was later dropped. Alba has won various awards for her acting, including the Choice Actress Teen Choice Award and Saturn Award for Best Actress (TV) for her acting in the series Dark Angel, though her acting has also been criticized, as she has been nominated for numerous Razzie Awards as well.


Some high-profile Bain Capital credit-investment funds are choking on losses of as much as 50%, said people familiar with the matter, the latest revelation in a day of shake-ups across the hedge-fund business.

The private-equity firm's credit affiliate, Sankaty Advisors LLC, has lost between 40% and 50% across two funds that bought up highly secured corporate loans, these people said. The two vehicles had roughly $4 billion in assets just a few weeks ago, and used a relatively low amount of borrowed money to fund their investments.

Steep losses have also hit London hedge fund Centaurus Capital LP, which Wednesday offered its investors a chance to cut their fees. And, at Tudor Investment Corp., one of the oldest and best-regarded hedge funds, fund manager James Pallotta finalized a plan to run his own firm separate from longtime colleague Paul Tudor Jones.

The developments at Bain, meanwhile, are a blow to a group of top-tier institutions that long have been investors with the Boston-based firm. Harvard University, the Massachusetts Institute of Technology and the University of Notre Dame all have some money invested in Bain's loss-making credit funds. Two of the problem funds include Sankaty's Special Situations and Prospect Harbor.

As market conditions have deteriorated, Sankaty has had to seek new, but more expensive, financing for some of its key borrowing facilities. It recently obtained longer-dated terms to stave off margin calls, which typically kick in if asset values fall below a certain price. The funds have not seen significant redemptions, according to a spokesman.

The market for leveraged loans -- senior loans issued by banks largely to fund buyout deals -- has plummeted in the last month. A Standard & Poor's index of leveraged loans now trades at 70 cents on the dollar, down from 88 cents one month ago. Until last summer, these senior loans rarely traded below par, or 100 cents on the dollar. In recent weeks numerous "bid lists" have flooded the market, creating overwhelming supply and further damping prices.

Money managers such as Bain, Blackstone Group LP and Carlyle Group have piled into this business in recent months, hoping to scoop up low-priced credits of high-quality companies. In many ways, these credit investments were supposed to fill a hole created by the greatly diminished market for private-equity buyouts. Sankaty's Special Situations fund, for instance, was raised in August 2007.

To fund these new transactions, loan investors typically borrowed some money to amplify returns. Many used facilities called total return swaps, known on Wall Street as TRS. Under these facilities, if the value of a loan declines to a certain price, the bank can secure more collateral or unwind the contract.

The Sankaty funds averaged about a dollar of leverage, or borrowed money, for each dollar of capital that belonged to investors. That level of borrowing was relatively low compared with many other investors, but it shows how even seemingly low-risk bets have suffered as the credit markets have virtually frozen.