Red flags of NorthStar Realty Finance Corp

--major driver of of the gain in 2008 is from unrealized loss in liability --It is not sustainable. I expect taht the company will report loss in Q1 2009 as the proceeds from operating lease will decline, the provision for loan portfolio will increase, and the momentum of unrealizd gain will flop. --With 1.9 bil exposure to CRE debt, it has not provisioned much. It only provisioned $11 mil in 2008. I expect the loss will deepen in 2009. quoted from company 10k For the year ended December 31, 2008, the Company recognized a net gain of $752.3 million as the result of the change in fair value of financial assets and liabilities for which the fair value option was elected, which is recorded as unrealized gain (loss) on investments and other in the Company's condensed consolidated statement of operations. http://www.sec.gov/Archives/edgar/data/1273801/000104746909001790/a2190701z10-k.htm#ei41901_item_8._financial_statements_and_supplementary_data opinion underweight wait until company to release Q1 09. If the company market cap drop below 0.1 bil, buy it.