User 68127

AIG and Bailouts: Welcome to the Real World

Rarely will you find the smartest people working for government. Those who want to be creative and, for better or worse, reap the result of their efforts will be in the private sector. Those who value conformity and the security of a paycheck regardless of performance will tend to be in govt.

The govt will constantly be chasing those more gifted and motivated entrepreneurs and trying to bring them down to their level and control them. Unable to catch them, and lacking the intellectual and moral basis to change their behavior, the govt will resort to manipulation and brute force.

Why AIG Wasn't Allowed to Fail

Don't call it 'government cash.' Call it what it is--taxpayer dollars!

Maybe taxpayers are better off being out of the bailout funds if it stems systemic chaos. Maybe not. But you have to acknowledge who funded the bailout of i-banks and hedge funds before you can even have an honest discussion.

Rage at the AIG Machine

B.O. is grandstanding, and the people are eating it up!

The bonuses amount to 1/1000th of the most recent bailout funds. They are contractually mandated. It would be a seizure of property and violation of the law to break the contracts.

If the feds were so worried about it, why did they give them the money in the first place? And are they going to micromanage EVERY single expenditure and exploit for political gain each one they don'd like, however small? Direct your anger where it belongs--at the government! No bailouts=no need to worry.

And one more thing, for those populist sheep who are taking the bait--don't bother to complain or be outraged unless you belong to the half of this country that actually PAYS the taxes!

Fixing America's Banks: Geithner Doesn't Have the Right Answer

Rather than the aggregator bank, run by the government, why not just get rid of mark to market? Then the banks could keep, modify, or foreclose their own pool of loans without having to start the death spiral of writedowns, capital raising...

I hate to say it, but I think even the banks are better equipped than the government to work out these loans. If only the govt would get out of the way with their misguided regulations. But then they would not be able to control the world and use their policies and threat of policies to buy votes and impose a utopian socialist world view...

McDonald's: Looking a Bit Overvalued

Agree. MCD is at a steep premium to the market without an impressive long term growth rate--although ANY growth at all is impressive at the moment!

So you have little return potential and a lot of risk should anything go wrong. In any event, at some point, people driving less and having less disposable income has got to negatively impact sales...

Why I Feel TBT Is About to Become a Goldmine

Agree that rates must eventually go much higher.

As we sent money overseas for high priced oil, the money was recycled into our Treasuries, keeping interest rates artificially low. As we imported goods from China, they essentially provided vendor financing by purchasing our Treasuries, keeping rates artificially low.

Now that oil is at a fraction of its former price, and now that our imports are plunging, who is the incremental buyer of Treasuries?

You will have reduced demand for Treasuries just as supply surges due to massive deficit spending. What do you think will happen to Treasury prices? And if, in addition, the dollar drops...how long before foreigners unload?

Barron's Roundtable Discussion: An Exciting Time to Pick Stocks

Exactly right! They say nothing at all, but in a very complicated and (to an untrained reader) smart-sounding way! What about them, other than their carefully-crafted reputations, does the author "respect?"

Beware anyone who follows their "advice." They are talking their books and usually wrong to boot. If their picks work at all, it is usually just a short term bounce as impressionable readers stampede into their ideas.

Meryl is the notable exception. You could usually make a lot of money following her picks. Why? Because unlike most of the others, she is a bottom-up stock picker who utilizes extensive and well-thought-out research in making her picks. The rest of them mainly spout top-down mumbo-jumbo, or, in the case of AJC, just repeat the picks of their analysts.

Obama's Public Spending Program: A Very Expensive Farce

My votes:

Obama--cynical.

Voters--mentally challenged.

Media--mentally challenged AND cynical!

Obama's Public Spending Program: A Very Expensive Farce

Is Obama mentally-challenged or just cynical? Magical thinking does not make for a strong economy.

Who does he think will be the source of this "free money" that will be handed out to those that pay no taxes, and to Chicago-style "pay to play" contractors? Which is more productive, people spending their own money, or the government?

Obama's plan takes money from the most productive members of society, and gives it to the least productive element--government. Individual initiative, property rights, and freedom take it in the neck!

Is Obama mentally challenged, or just cynical? What about the people that voted for him? What about the media?

Barron's Roundtable Picks for 2009

Meryl is by far the smartest member of the RoundTable. She is about the only whose opinion is worth anything. Scott Black is OK too.

Other than that, they are just a bunch of self-important windbags using the RoundTable Forum to tout their, or their firm's positions and burnish their reputations among those readers who don't bother to check back on their results.

The Best Buy Signal in 51 Years

The Fed model implies that stocks would need to be trading at 40x EPS in order to equal the 2.5% earnings yield of the 10-year Treasuries. Unless earnings completely crater, that would imply some pretty nice appreciation for the S & P 500.

Stocks may be undervalued, although I would not rule out that possibility of a cratering of earnings. However, it is virtually certain that the Treasuries are overvalued. A case can be made for stocks or for cash, or even for corporates. What kind of a lunatic thinks that Treasuries present a good risk/reward?

Obama's Option: Big Tax Cuts

The Obama 'tax cuts' are really not tax cuts, but welfare. The most productive members of society, who can spend the most and create the most jobs, will be excluded via income caps and actually shoulder MORE of the tax burden. Those who pay no taxes will get a 'tax cut' (read: socialist welfare payments via redistribution of income). Through Clintonesque word games, Obama and the pliable media turn this into 'tax cuts.'

It would be great if we had true tax cuts--and they would work! That, however, would mean including everyone through MARGINAL tax rate reductions that are PERMANENT. Then the people could decide how to most productively deploy their money and stimulate the economy. I suspect that this is not what the Dems have in mind.

The alternative is to grow government, balloon the deficit, and increase waste and corruption (for examples, look at Illinois, or the national mortgage scandal, or...) all to line the pockets of cronies and appear to be 'doing something'...

TLT Has Momentum

Using a momentum strategy and technical analysis to invest in the 10-year? Not a good idea.

The already low yield can only go to zero, limiting your upside. Selling or shorting the spike would be a much better risk/reward proposition.

High-Income Shoppers Slashed Spending Most Over The Holidays

It is not that hard to figure out! Those who make $30k per year basically spend every penny just on non-discretionary living expenses--there is little ability to cut since they are already maxed out.

Those that make $150k+ who formerly spent it all have a lot of leeway to cut before reaching the necessities. The daily Starbucks, eating out, the expensive vacation, that fourth cashmere sweater, the nanny, the botox treatment, the club membership....

The Trouble with Recession Averages

Debt as a percentage of GDP is an incomplete (and misleading) picture.

A better measure is net worth, or debt as a percentage of net worth. U.S. net worth, last I looked, was north of $50 trillion. Meaning, for the financially challenged, that U.S. has $50 trillion left over after subtracting debt from assets. More than $150k for each man, woman and child in the U.S. Hardly insolvency.

Another better measure is debt to annual income.