Morning updates: Snowstorms, short stories and Xmas rock
It’s Monday and I can see the storm blowing over the mountains and enveloping the land around me. I meant the snowstorm here in Ruidoso — not making too much of an allegory there. Too much of one anyway.
I’m doing a big update on LPS so stay tuned for that. Long story short (or in this case, short story short! Get it? Short story short cuz it’s a short story about a short position, see? Sigh), here’s what’s likely in store for LPS and this is why we will likely continue to short this puppy anytime it rallies:
Nevada AG Catherine Masto is moving along quickly with her pursuit of mortgage abuses. As we indicated when she brought her civil case against two mid level LPS employees, she appears to be going systematically, from the bottom of the crime racket. First she has gone after the foot soldiers. Now she has filed a wide ranging civil suit against LPS, which handles over half the foreclosures in the US via its network of foreclosure mills. Based on reports I have heard about LPS conduct from multiple, credible sources, I am quite confident that Masto has solid evidence backing the charges in her suit. LPS is likely to claim it believed it did nothing wrong (!) because it was acting as directed by its clients. Or Masto may separately be able to prove the servicers were well aware of LPS’s actions by getting her hands on internal documents or LPS’s software (impermissible practices institutionalized in the software cannot be a secret to the servicers). So expect Masto’s suits to lead to the heart of the servicing industry. She has found the thread that can unravel the entire garment and is pulling hard. — Yves Smith at NakedCapitalism.com.
I’ll send along an update of my latest positions in order of largest to smallest in a bit. Not looking to trade much today, but we’ll see what pitches come our way. I’m looking to buy another tranche of FIO common and/or calls if it drops much more from here, as I’ve already done a tranche buy at these levels.
How about a little holiday rock n roll then:
AC/DC Mistress for Christmas
