capgain

Geithner Unable to Break with the Past

Geithner's "plan" was like kissing your sister.....nothing there. The wags and the pundits were quick to pin the 400 pt drop on this, but I think the cause was far more serious. I think people are realizing that they are on a ship sailing in troubled waters, and the captain just doesn't have the experience or the skills to navigate through safely. To wit, Monday evening Mr Obama stood before the country and, with his bare face hanging out, continued to insist that this bail-out bill was devoid of all pork and earmarks!!! Does he really think that we are all deaf, dumb and blind, and willing to follow him as he stumbles from mistake to mistake?

Of course the market pulled back, just as one rightfully jerks one's hand from a hot stove. What is really needed now is a lot more honesty, and a lot less polished rhetoric.

Where's the Bottom? Still Anybody's Guess

Very thoughtful effort. It is all too easy to get caught up in the "We have to do this $800 B rescue plan or the markets will collapse" fervor, but there ARE alternatives that deserve consideration. Right now there is roughly three trillion in "idle" capital just sitting on the sidelines waiting for the dust to settle. Some of that is mine and, like T Boone, I "have a plan."

With one easy move by our genius legislators in DC, we the investing public will be able to say to the Paulson posse, "Thanks, but no thanks!!" All they have to do is lower the capital gains tax to ZERO for ten years. You can almost see and hear that three trillion racing by!

A far-out idea, perhaps, but the unpalatable alternative is to have the govt control another hugely important aspect of our lives.

The Case for AIG - Patience Required

Writer will be shown to be correct if and when the Board boots Sullivan out the door! He's in a job that is much too big for him and nothing is going to turn around until a new captain takes the helm. Thanks to Spitzer's megalomania and Sullivan"s ineptitude, $80 billion has been vaporized. That's a long, long road to come back.

Dow: An Undervalued 5-Star Market

It's tough to argue with Mr. Johnson's assessment of these major players; most of them are in my portfolio and I am very willing for him to be right! However, AIG (my second largest holding) is problematic. This company is like an out-of-control freight train heading for almost certain disaster. Sullivan is so far over his head it is shameful. It's hard to believe but a good $80 billion has been vaporized to date and I don't see who/ what is going to step in to effect a change in course.

Your over-all take on the major players you mention is probably correct with this one exception.....it almost makes me gag to have to look at the reality of AIG; right now it is OVER-VALUED!!!

AIG: Are the Losses Accelerating?

"Prudent" and Paul Price both make valid observations. AIG is like a champion athlete who has been laid low by a devastating virus. A whole bunch of things seem to be sapping the life out of it simultaneously. Sullivan is in over his head; this is just too big a job for him. We can only hope that the board is looking around for a Lee Iacocca or a Jack Welch.

The news today that the Jax Police/Fire Pension Fund has filed suit is not surprising....and there will be others. The fact that what has been marked down today will be gradually marked back up tomorrow is lost on the knee-jerkers. The myopic never grasp that life goes on beyond the next twenty six minutes!

I prefer to take a longer view......and it ain't so good either! We are watching our economy collapse around us, shipping boatloads of our treasury to our enemies overseas while our infuriatingly inept and partisan congress decimates our domestic buying power by sucking up to a farm lobby that must know where every body is buried.

But step back and re-focus. If you truly take a long-term view, it will be the AIGs and the GEs and the MSFTs that will withstand the ineptitudes of our government and the maggot-like attacks by the likes of the Jax funds. These large-caps might still see some more selling pressure, but I'll remain long and add to them opportunistically.

Martin Sullivan Deathwatch

He is toast, the embodiment of the Peter Principle! Together with that paragon of virtue, Eliot Spitzer, the two of them have managed to vaporize many billions of dollars of capital. No doubt Hank Greenberg has his warts, but he built a hell of a business! I'll line up behind him in a NY minute if he really thinks he can pull off a Lazarus!!!