fineye

What Will Goldman Sachs Do With $10 Billion? How About Buy a Bank

Why not WFC..?? a stock deal.. ?
I believe that could be one reason why Warren Buffett has agreed to put money in GS.

Financial Shock and Awe: RTC 2.0?

It looks very Obvious that all kind of innovative rescue plans by the Fed + Treasury + SEC are being experimented now when the survival of GS and MS are at stake. The former GS and MS men currently in various government jobs and current GS and MS men who were once in government jobs are desperately trying to save them taking their X-competitors route.

America Buys AIG

Hence...

Don't do a petty theft.... Do a HUGE crime...

America Buys AIG

Moral of the story:

You'll be bailed out IF you are:

-Too large to fail (FNM, FRE)
- Have too many complicated + exotic derivatives that could have a domino effect on the financial system (BSC, MER)
- Have bet millions of depositors/ insurance policyholders money in a wild gamble (AIG)

While...

- If the institution hasn't made too many wild bets and not many people and institutions would suffer from your failure, you are not worth rescuing (LEH)

Expect the Real Rally by Mid-2009

In 2007 majority believed 2H08 would be the start of recovery, we now know how accurate it was. Housing was supposed to bottom out by end of 2007 and stabilize in early 2008 and start moving 'up' in 2H08. It is not about 'optimists' and 'pessimists', it's about 'extreme uncertainty'. No matter what 'experts' say about past recessions and compare that with the current one, it is Never the same, and the economy will always surprise.
Better not try to catch the bottom, it is a traders market, or you could also take it as an investors market if you have a 5-10 year horizon.

Oil: The Inconvenient Truth

Everybody is relieved Oil is 'down', just to put it in perspective...
- Oil was up 465% since 2001 up to its peak in July 2008 (about $25 was the high in 2001, though it was below $20 for quite sometime)
- Oil is now up 320% from 2001 and has corrected by 25% from its peak.
- If Oil had hovered around $100, and never touched $145, we would've still thought the current $107 is way too high... but not anymore... now we believe it is down by 25%... and that's a GREAT news...
- To conclude... the "operators" took Oil up to that level so fast just to drop it equally fast so that the consumers 'feel better' to pay $100 after it dropped from it's peak by about 30%.
- Never be surprised if next Oil moves equally fast to $200 soon and drop to $150... and all of us will still be HAPPY.

When the Market Runs Out of Lifeguards, Will You Sink or Swim?

I agree with bearfund, the next Fed move will be 'down'. Recent 'strong' GDP number is the courtesy of weak dollar and not strong domestic economy. And not to forget, the current situation increasingly looks like a prolonged slow growth environment, rather than a quick painful plunge and a sharp rebound. With rising unemployment, cost pressure will eventually subside, and the lack of growth and continued bleeding of Wall Street will force Fed to cut the rates.... and it could well be as soon as pre-Christmas (to boost consumer "morale") or the new year, as the new administration (whichever) will be eager to impress the countrymen.