Duude

Time for the U.S. Economy to Reindustrialize

Unfortunately, I have to agree with the notion of America re-industrializing is more pipe-dream. Its an especially ironic view for Obama since his cap and tax plans run counter to any re-industrialization. Much less expensive for both labor and energy to set up shop in an emerging nation. But I do understand why he may say such things, while organized labor owns his administration and manufacturing had been their most-prized hold for decades, but this still remains a pipe-dream. Organized labor has doomed manufacturing in this country. Any American re-industrialization will surely set up shop overseas if they want to remain in business. The only weapon the administration has to protect union jobs is protectionism in the private sector. The administration has also thrown around ideas of creating a new green industry, certainly paved with union labor. This can only work if government plans to oblige the left with protectionism. Frankly, stupid politics and greedy unions have brought us to this place. My best advice for them is to instruct their children to not follow in their footsteps but to get an education.

Ten Most Prominent Underperformers in Corporate America

I must say its ironic that 'the highest proportion of upside surprises since Thomson Reuters started tracking the data in 1994' coincides with one of the largest one year drop in S&P 500 revenue. This only reflects speedy cost cutting through immediate layoffs pointing to a universal conclusion that a recovery wasn't perceived back when these companies laid off their workers. Has anything changed? Nope! Who beside the government is going to kickstart a hiring phase when 10% unemployment spells a stingy consumer? Can the government hire everyone? They may foolishly try.

Too Big to Fail Banks: A Simple Solution

What ails large banks starts with our careless government mishandling the sector over decades. The US government has been in the business of tweaking the home ownership market for decades in an attempt to spread the wealth. In so doing, we've established home ownership tax favored status as an investment vehicle, and we've created a market place pushing easy credit onto those least able and least likely to uphold contracts. Surprise, surprise, it blew up! In order to disassemble the Frankenstein our government has now created, we must first stop adding more appendages. The Feds have to stop propping up the real estate market buying up the mortgage backed securities that few will buy, and bailing out people months behind on their mortgages with easy terms and forgiven debt through Fannie and Freddie. Fannie and Freddie need to be spun off into private hands with no more implied or otherwise guarantees. What we're doing now in the real estate market will either need to be unwound at a later date or FOREVER be supported with taxpayer money.

The Five Worst Bailouts

I'm a little surprised we have no mention of Fannie or Freddie. While they were clearly bailed out and continue to be bailed out as they write down mortgage balances and offer low interest rates for many homeowners who hadn't enough good sense to buy what they could afford in the first place. Many of these same homeowners are now bailing on their new mortgages as well as unemployment rates skyrocket.

Insiders Continue to Sell, Sell, Sell

They're just diversifying their holdings..........into cash.

John Paulson: Long Financials

I'm quite confident that Paulson's next 13F will show his exposure to financials has decreased precipitously. He knows more money will flow to financials with the publication of his June 30th holdings. It provides him with the needed liquidity to unload at least part if not all of his position. Financials are an early cyclical, but they are far from out of the woods and 2010 will reveal it more clearly.

Why Congress Is Asking Bernanke Bogus Questions

Weighing all that was said it appears very likely that Congressman Issa's accusation is right on the mark. Whether Bernanke personally threatened Lewis with financial support or his job is not as clear. Other Fed officials could have passed the message in a host of ways without Bernanke speaking the words himself. Some feel that the seriousness of the situation warranted pulling out all the stops. I feel there is a real problem with government strong-arming business leaders to do what's not in the best interest of their own shareholders. But it seems also likely that Lewis did his part to see the deal done by purposely failing to disclose to shareholders what he knew before the Merrill vote. Lewis was in a catch-22. If he disclosed all, shareholders clearly would have voted it down. That could have meant his job was at risk if and when the company sought government support.

Don't Blame Mark-to-Market for This Crisis

I realize the ease of blaming M2M and then point at all that cash we're dumping on these firms to build up their capital. But I have to consider the wisdom of the investment banks that foolishly believed in their quants and leveraged their bets while knowing full well that M2M was the accounting standard in use. Who has ever fully leveraged a stock account with margin and learned how critical your positions are to the health of your account? Now multiply that leverage 30 fold and how much more important should one's knowledge of their portfolio be?

Why Nationalize in 2016?

Nationalize now and reprivatize in 2016? What are you kidding me? Let the government run the banks till 2016? Isn't it bad enough we gave them social security, medicare, amtrak, US Postal and education? Why isn't Johnny learning? I dunno. Maybe our financial system is only as important as Amtrak to our economy......NOT!!!

Nationalization: Is It Inevitable?

I'm curious as to what the rental market will look like within a year and 2 years from this point, in some of the most beat up sub-prime real estate markets? There's an inland area in Southern California known as the Inland Empire that saw a raging building market up to the point that the market collapsed. Most of the foreclosures are sub-prime and alt-a mortgages and the foreclosed bank property inventory is huge. Will likely see vacant homes for years if they aren't rented out.

Banks: Nationalize, Cleanse and Get It Over With

It seems to me it would be far less expensive and much more manageable to temporarily reform would be to drop mark to market accounting for some period of time, rather than nationalizing the banks. Of course, I'm assuming that any nationalizing of the banks would carry with it intention to recapitalize and spin them back off into private hands. If we're talking about permanently nationalizing, no way no how should we even talk about such a bad idea. If you thought you knew what moral hazard was before, government will be happy to show you how much worse it can get.
I don't like the idea of suspending mark to market but it is much more favorable a choice than nationalizing.

Obama's TARP 2 Signals an End to Mark to Market

What would we have here if we eliminated mark to market? Certainly we would lose transparency. I'm certain many CEOs would love this. I don't mean to make it sound as if CEOs are all trying to deceive, but mark to market brings a certain transparency that reveals embarrassing and outright poor decision making at many companies. It would likely lower CEO turnover because judgment errors would be easier to hide. As a shareholder, it would be a shame to lose that.
This is really a call to shoot the messenger. Can anyone claim this isn't anything more than sweeping what ails us under the rug.
Really, this isn't the problem. The problem was created over more than a decade of public policy decisions that shaped the real estate market. Most of these policy decisions inserted various degrees of moral hazard. Add to that a low interest rate environment, and poor oversight and we have created a tsunami of our own doing. Why should we blame the weather channel for reporting it?

Morgan Stanley Smith Barney and the Future of Citigroup

Citi is going through signs of final surrender. Offloading Smith Barney isn't something done lightly. They're just cutting away the meat for cash and so that all doesn't become rancid. Citi will now finally surrender to governmental forces and become a propaganda tool of politicians

Last Thursday Was the Bottom - It's Time to Get Back in

I prefer the term bottoming over bottom. Huge margin of error allows me to almost always be rightish on the money.

Three Financial Stocks Worth Holding

On the contrary, in Europe government has a piece of the largest banks. They have and will continue to prop up their banks as they see fit. European balance sheets are very murky and unreliable. Their accounting standards are a disgrace. The only thing providing a sense of stability is that everyone knows the government will rescue in a New York minute.


On Nov 30 10:44 AM Jimmy Lathrop wrote:

> I'd buy AZ before buying any of the other banks. Why? Because in
> Germany there is no fiction of market capitalism, and thus, there
> is no need to constantly change the rules when management inevitably
> blunders.