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Backroom Bear Stearns Deal Exposed

It is time to put the "moral hazard" nonsense to bed. This red herring has been proclaimed so loudly that even Mr. Paulson cited it as the reason why the price for Bear needed to be "low". Let me ask the investors here whether their analysis has EVER assigned any weight to the concept of: if I invest here, and it goes really bad, at least the Fed will bail me out". Of course not, because by that time not only your own investment, but everyone else's investment in an entire industry sector must be at risk of collapse AND you'd have to have some idea about the political environment at that hypothetical point in the future and a ton of other speculative and contingent factors would have to converge. If there is an investor out there so smart as to have predicted all those things - she almost certainly wouldn't have been buying bear stearns common just prior to the meltdown in the debt markets. If moral hazard is a problem, perhaps it's at the much more predictable level (i.e., if there is a recession, interest rates will drop) - certainly NOT at the level of "if there is a recession, and house values drop, and lenders lend too much to households using house values as security, so people can't value collateralized debt obligations, so markets lose confidence in investment banks that have exposure to cdos, the fed will bail out my equity investment at 4 cents on the dollar". Any impact of such an effect on investment activity simply has to be de minimus

Why Hollywood Hates the TiVo Consumers Love

Absolutely, TiVO is an innovation and has great value to consumers. But that is only the first part of the analysis. It's advertisers who paid for the "free" episodes of Cheers. As long as there are only a few people skipping ads - consumers may not notice that less money is going into providing programming. Early TiVO users get an apparent free lunch. If everyone skips commercials - there are no more shows and the TiVO becomes a useless device. It's all kind of moot at this point - TiVO is a part of the landscape and it's adapting, but it's no so clear that consumers, over the long run, win in the bargain as programming needs to be either paid for by the consumer (DVD, DTO), or the cost needs to come way down (less CSI, more reality television), or the programming needs to be something you won't watch on delay (e.g., news/sports). Skipping commercials is not much different from jumping the turnstile on the subway or sneaking under the fence at a concert - as long as the trains run and the show goes on it seems like a "pro-consumer" move. Why shouldn't someone be able to sell an "innovative" "pro-consumer" device that helps people sneak into concerts undetected? The answer is obvious.

Gold Due to Correct: Sell Randgold Resources to $29?

so . . . one reason why costs rise when the price of gold rises is that the price turns waste into gold. When you engineer a mine, you take blocks that cost more to process than the anticipated revenue and call them waste and either don't mine them, or if the mine design requires it for other reasons, you haul it to the waste pile. for example, suppose a particular block costs $50 a ton to process and has $35 per ton of gold in it. It's waste. If gold doubles, it's ore. of course, the average cost goes up, but so does profit.

Sirius/XM Merger to Provide Substantial Upside Potential

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