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Kyle Spencer

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  • Sears Holdings responds to reports of distress [View news story]
    Oct 8 10:39 PM | 1 Like Like |Link to Comment
  • Sears Holdings responds to reports of distress [View news story]
    Good one. ;)
    Oct 8 10:38 PM | Likes Like |Link to Comment
  • Carney: Don't buy the dip in Frannie [View news story]
    NYT Dealbook:
    Oct 2 11:49 PM | Likes Like |Link to Comment
  • Carney: Don't buy the dip in Frannie [View news story]
    The consequence of "parting these seas" may be higher borrowing rates for TBTF/SIFI institutions if the Sweep Amendment is allowed to stand. The credit agencies can't just ignore it.
    Oct 2 11:32 PM | Likes Like |Link to Comment
  • The war of words starts over Netflix-IMAX feature film initiative [View news story]
    "The company emphatically states that it will not participate in the "experiment" to release the same product on screen three stories tall and 3 inches wide."

    No doubt the last major horse-and-carriage outfit said something similar about "that blasted Ford Model T." Go and look for them now.
    Sep 30 09:34 PM | 1 Like Like |Link to Comment
  • eBay spinning off PayPal [View news story]
    You buy eBay.
    Sep 30 09:34 AM | Likes Like |Link to Comment
  • Joe Stiglitz Vs. The Austerity Zombies [View article]
    Who's coming to collect - aliens?
    Sep 29 02:51 PM | 2 Likes Like |Link to Comment
  • Precious Metals Prices Fall: Gold At A Critical Juncture [View article]
    "Prospect for higher US interest rates"

    I see this as the determining factor. If the markets take higher rates in stride, gold will be in for some real pain.
    Sep 29 02:36 PM | 1 Like Like |Link to Comment
  • Hang Seng tumbles as protests expand [View news story]
    This is a wake up call for anyone who believe that the CPC has somehow rescinded the laws of economics. Dictatorships are ultimately inefficient precisely for this reason.
    Sep 29 02:22 PM | 1 Like Like |Link to Comment
  • European Commission to accuse Apple over illegal Irish tax deals [View news story]
    Way ahead of the news on this one.
    Sep 29 09:38 AM | Likes Like |Link to Comment
  • Alibaba Is Coming Like A Freight Train [View article]
    1999 was based on kids with business models scribbled on the back of pizza boxes. Alibaba is an Asian conglomerate with Apple-like margins that's taking 4 ¥ in 5.

    Now, Amazon on the other hand...
    Sep 26 08:11 PM | 7 Likes Like |Link to Comment
  • Yahoo sued by Mexican companies over $2.7B judgement [View news story]
    What a joke.
    Sep 20 10:13 AM | Likes Like |Link to Comment
  • The 'Entire Fairness' Solution To Fannie Mae Shareholder Rights [View article]
    Pg. 34

    "The Takings Clause

    The Takings Clause thus provides two litigable paths forward for the
    Fannie and Freddie plaintiffs. For a Winstar-like claim, the shareholders
    might analogize whatever contractual rights are provided by the shares held
    by Fannie and Freddie's minority shareholders to the deal entered into by
    thrift regulators, and reneged by Congress.

    The fit is not easy; in one case the government entered into an explicit arrangement with thrift
    investors, while in the other the government merely took control of a
    corporation that might have had contractually created rights to a dividend in
    its shares.

    The other path requires the plaintiffs to establish that, after the
    receivership, the government has a strong conflict of interest. It can pay a
    dividend to other shareholder or keep all the profits for itself. In this way, it
    is choosing between using the expected returns from its valuable property to
    feather its own nest or to compensate plaintiffs. This gives the government
    every incentive to reject their petition, and putting it into the position,
    unloved in due process, of referee and competitor in the same game.

    Both approaches illustrate two critical issues that we believe informs the
    remedy that the court could adopt. First, they depend in the claim on the
    property taken from the shareholders being property of value. This boils
    down to whether Fannie and Freddie itself had any worth at the time of the
    Third Amendment. Second, they depend on government action that looks
    like clear chicanery. The regulators in Winstar may not have been cynical
    opportunists, but Congress forced them to essentially lure investors into
    thrifts with written promises that they then broke. The receiver in First
    Hartford Court also had the clear conflict of interest created by being a
    judge in its own case.

    As we suggest below, we think this sort of sense of unfairness animates
    this sort of creative litigation, and that, although we marginally prefer an
    administrative law remedy to a Takings Clause remedy (our interest in
    disciplining the government in a way that still affords it the flexibility to act
    in a crisis would also be met with a Takings remedy), we find that the rare
    occasions in which Takings cases have been permitted in receivership cases
    inform our administrative law analysis. Indeed, the fact that the bulk of the
    claims of the plaintiffs in these suits focus on APA defects shows where
    they believe their strongest case lies.

    pg. 40

    interest here is remarkable.
    It is fair to conclude that a controlling shareholder's decision to award
    all of the profits of a company to itself is a self-dealing transaction, and it is
    this sort of bad faith that courts have suggested provides a reason to look
    beyond the bars of review that ordinarily exist in receivership and
    conservatorship cases.

    For example, decisions by the FDIC on the way it
    has timed the repudiation of contracts in failed banks have been policed by
    the courts on a number of metrics, including evidence of bad faith by the

    Indeed, one of the reasons to appoint a receiver is to take over
    an enterprise that has been acting in bad faith; it would be odd to assume
    that if the receiver also exhibited bad faith, the court could do nothing about

    Pg. 46

    We believe that in this case stock prices along with a valuation analysis
    typical of entire fairness should determine the value taken from
    shareholders by the Third Amendment. This would involve financial
    experts using the tools of their trade to value Fannie Mae and Freddie Mac.
    The basic tool would be a discounted cash flow analysis as there really are
    no comparable companies to Fannie Mae and Freddie Mac. Of course, such
    a discounted cash flow analysis would need to forecast the future profits
    (and cash flows) of the two GSEs. This essentially devolves to the prospects
    of the housing market at the time of the Third Amendment and the
    competitive position of Fannie Mae and Freddie Mac. On the latter, the two
    GSEs had come to not only dominate but comprise the entire market for
    mortgage origination at the time of the Third Amendment, a market share
    with tremendous value."
    Sep 14 02:22 PM | 3 Likes Like |Link to Comment
  • The 'Entire Fairness' Solution To Fannie Mae Shareholder Rights [View article]
    Good article.

    "...the market value is a good guide"

    Wouldn't that be tantamount to suggesting that a person who is robbed of their valuables could only legally sue for whatever crumbs the robber happened to leave behind; because, after all, that's all they really "own"?
    Sep 14 01:39 PM | 6 Likes Like |Link to Comment
  • Rhetoric turning hysterical ahead of Scottish vote [View news story]
    "Chance of yes vote is zero."

    According to the bookies, its 22%.
    Sep 13 06:09 PM | Likes Like |Link to Comment