Wake me up when sanity comes back please

Yesterday UBS, a huge Swiss bank announced a $10B loss in - you guessed it - junk mortgages.

Also yesterday WaMu announced massive layoffs and further write downs because of - your guessed - junk mortgages.

Also yesterday B of A announced it was in deep doo-doo with some of its money market (supposedly safe) funds because of - your guessed it - junk mortgages.

Today H&R announces some pretty hefty losses because of - you guessed it - junk mortgages.

All that was going on and yet the Dow Jones was up 100 and it is up again a little today. And the headline news of the day was that housing is back baby.

It's funny to me that the wizards of Wall St are so easily manipulated. They are like Pavlov's dog. They hear the words "Fed Rate Cut" and the salivating begins. What is often missed is that these wizards with MBAs and PhDs from the finest schools around were taken by high school dropouts mortgage brokers who initiated all the junk loans. They bought trillions of worthless debt from guys whose previous job was used car salesman or Best Buy clerk.

Now they are being taken by the likes of Lawrence Yun, head of the NAR who is laughbaly calling for home prices to rise in 2008. This is the same guy who has been revising his predictions every month for the past 13 months. He'll predict prices will be $X in January. Then on Jan 31st he'll quietky revise that prediction to $X less 3%. And then in February when the number comes in at $X less 3% he puts out a press release saying the market is stable and predicatble. He has been doing this for over a year and yet the tools on Wall St. still haven't caught on to the charade. Goes to show, you can have all the degrees in the world but if you don't have any common sense it means nothing.