antiquary

Wall Street Breakfast: Must-Know News

Doubleguns, contracts have been breakable for centuries, contrary to your statement, and many economists argue that they should be if that's the economically sensible thing to do. Our bankruptcy laws have reflected that for centuries, too. It's neither anyone's business nor their duty to validate or even respect anyone else's unilateral expectations, in or out of business. You pays your money and you takes your chances. The old fishing adage comes to mind-- "that's why it's called fishing, not catching."

The Virtue of the Republic

"So essentially, by artificially lowering the price of capital (interest rates) supply dries up, as it does in every market where price fixing is allowed. If you can't earn a decent return on your money, why would you take it out of your wallet?"

The posit you take as granted is that the ceiling set by the Fed is below a decent return. This is not necessarily true; what a "decent return" is will depend on what the alternatives are in the current economy. The general level of paranoia is not a legitimate factor. I think the way you get banks to lend is by showing them that they're being outcompeted by other people or entities who are lending, even if that has to be the Federal government for a time to prime the pump.

The 'Sell After Dividend Cut/Freeze' Rule, With Exceptions

The only reason to sell after a dividend cut is to avoid the value-trap effect by which all those in it only for the immediate cashflow haul their freight out of Dodge. Once that has subsided, the fact that the company is not paying a dividend or not as much of one is not a reason not to own it in these economic times. I would just put the money back in at the new reduced level-- assuming always, of course, that it's still a worthwhile business, without which you shouldn't have been in it in the first place-- and wind up with more shares than you had before for the same money.

The Economy, And Why It's Taking So Long to Fix It

It's not 20 years in the making, it's 30. The credit culture at the root of this addiction to leverage began with the US Supreme Court case Marquette National Bank of Minneapolis v. First of Omaha Service Corp. (1978). That case gutted state anti-usury laws by saying that nationally chartered banks can apply the interest rate laws of the state where they operate from, not the state the borrower is in. That, of course, set up the classic "race to the bottom" among states that we're now seeing in gambling; states without anti-usury laws attracted the big credit card companies and became addicted to the taxes on the huge amounts of money that began rolling in, providing the incentive for other states to repeal their anti-usury laws.

Congress, of course, should have then stepped in and amended the federal law to reverse Marquette National Bank, but they didn't.

On Feb 27 06:06 PM User 365859 wrote:

> The mess we got into is 20yrs in the making. It started with the
> most favorite nation status to China(by Bill Clinton). Since then
> we have shipped 7 million manufacturing jobs to China. and the 20
> million support jobs that go with them This was done with the help
> of wall street and complicity of our managerial and political class.
> In order to maintain the standard of living in the face of these
> losses of good paying jobs american middle class borrowed too much
> and again wall-street was complicit in selling mortgages credit cards
> and every other form of debt that they knew people would not be able
> to laon back.
>
> Let the larger banks fail and create an RTC which will then sell
> those assets that are worth something to the next tier of banks.Wipe
> out the common share holders and start over. There would be much
> less pain in the medium term and we could make the medium banks the
> abilityh to make good profits and grow.
>
> The individual howeowner like me who has 70 percent equity is just
> going to suck it up. There are a few million too many homes in this
> country and we have to work through the inventory which could take
> a long time.
>
> I am my brothers keeper so we the better off have to help those less
> fortunate.
>

Bank of America Continues to Stand Strong

I'm a moderate and used to be a Republican. And I'm pretty disgusted by the extremes of the left wing. But I have to say, nothing makes me more unlikely ever to be a Republican again than the blinkered whinging of the Obama-is-a-socialist morons.

On Feb 22 10:10 AM NITRAM wrote:

> If the used car salesman's (Obama) has its way the will nationalize.
> Remember, he wants socialism. You are dealing his the --- --- who
> fooled most of the people most of the time. Of course nationalizing
> would be the worst thing for our country. However, with the most
> corrupt and the most incompetent administration and congress in
> history what canb you expect.

Sorkin's Questions to Bank CEOs, Answered

"Pandit has no moral obligation to buy stock in an insolvent bank just because he's its CEO."

And it shouldn't raise eyebrows if a newly hired chef is never seen eating his own cooking.