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AIG Bailout: Over to Congress
I just re-read my post and realized that paragraph made no sense...
AIG Bailout: Over to Congress
As others have said, I don't think we would want to wake up tomorrow morning in a world where AIG had collapsed. I was in favour of letting Lehman go - mostly because the Fed had to prove a point. I don't see the AIG backstop as contradicting that premise. There are some institutions that have such an insane amount of counterparties, and so much stuff on their books that they can't be allowed to fail
The truth is that shareholders DO deserve to get wiped out - if you invest in a bad company with bad management, that's your fault and your problem. The people that deserve to be saved (and the ones for whose sake this bailout is happening) are the related counterparties. These aren't people who invested in AIG, these are people who had indirect dealings with them. Yes, it's prudent to have some kind of cap on maximum exposure to a particular counterparty, but when something is as huge as AIG it's pretty impossible not to have an inter-dependence with it. For example, if Microsoft ceased to exist tomorrow (and I'm not saying it will) what in the world would everyone do? would it be your fault for backing a bad horse? not really, you just used the standard that probably 90+ percent of the world runs on.
Also, when you start looking at naked puts etc, yes it's your problem. you're the nut who took on unlimited risk. However, with exchange traded options, there is a clearing house which insures the transactions and which should maintain stability if someone defaults. When you're looking at OTC credit swaps, that becomes much more complicated.
Poll Shows 73% Americans Think Starbucks is Overpriced
I have to liken SBUX's situation today to that of McD's a few years ago when "Supersize Me" came out. Everyone suddenly started to hate McD's, yet look at the massive turnaround since then.
SBUX caters to the brand-conscious people who don't mind paying more for quality. Tim Hortons and McD's coffee just isn't as good, and I can't see anyone going to Micky D's for a business meeting.
I am thinking of going long SBUX, but I want to see some support come into the stock before I jump in. Once all these store closures filter through the system, there will be much more efficiency. And if SBUX can't maintain a ridiculous growth rate, then WOW they might use money to buy back stock or pay a dividend - and what's so bad about that?
TTM Speculative Activity Actually Decreased on the NYMEX
There's no political motivation to kill these subsidies though because, as one insightful article said, "US farmers vote - (people in third world countries who can no longer afford food) dont"
TTM Speculative Activity Actually Decreased on the NYMEX
Apple Will Flourish With or Without Steve Jobs
Jobs is a visionary leader, one who is willing to take chances, but who knows exactly where he wants to go. As has been mentioned, everything that Apple has done since Jobs came back was to position the chess pieces to quietly get Apple's products into most homes in America.
Job's vision, to use iPods as the "gateway drug" toward getting people to switch to Mac, has become more and more transparent lately with the introduction of iPod Touch and iPhone. These things are basically running OSX for all intents and purposes. If you can learn to use these products, you're 80% of the way to knowing how to use a Mac.
(cue the 'this is your brain - this is your brain on Mac' ads...)
The real issue with Apple is that Jobs has an almost omnipotent reputation in computer land, and also in investor land. The psychological effect of Jobs leaving may well be more severe than the real effect on the company. I am sure that as iron-fisted and as smart as Jobs is, he has learned well from his previous mistakes, and he knows exactly what would happen if he walked away and let the bean counters take over.
Having said that, most good organizations today, including Apple, emphasize culture very strongly. The whole point of a corporate culture is so that everyone is on the same page, and knows what they should be doing even if there are no hard and fast rules around for the particular situation. I think Jobs, and Apple, do have a plan for managerial continuity - it would be irresponsible not to have one.
The long and short of it is that when Jobs announces he's leaving (and let's face it, he IS HUMAN - which might be hard to believe some days) Apple's stock will likely fall hard. I'd say it would be a buying opportunity in the short term at least.
I Think Icahn: Time for Yahoo's Yang to Play Chicken?
As you point out, I would be pretty shocked if stuck with 33 or 31.
As I've been saying for the last few days, you'd get a "bride price" if you go to the alter willingly, but if you turn it into a shotgun wedding, you take what you can get - unless you want a bullet to the brain!
the one thing I like about Ichan (and the thing that Yang should like) is that Ichan has basically come and offered to play "bad cop"
It's like "miracle on ice" where the USA's coach pretty much decided to be completely harsh to the entire team so they all united to hate him...but they used that motivation to win.
My point is, if Ichan plays bad cop, Ballmer doesn't have to. Ballmer would tick off all the Yahoo employees who might bolt. With iChan, both sides come out innocent, Ichan takes the blame (he's not one to garner a reputation as a cuddly teddy bear so he doesn't care) and we end up maximizing yahoo shareholder value, and Microsoft gets what it originally wanted.