najdorf

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  • AIG: How It Spent Your Tax Money
    You guys are looking the wrong way by blaming short sellers and CDS buyers. Blame the CDS sellers and the management of companies that failed. If Lehman was sold off unjustly, they would have been able to demonstrate convincingly that their stock was undervalued - disclose the portfolio, find some buyers for good quality assets to raise capital, and show us the cash flows that justify their valuations for various securities they hold. If AIG got taken for a ride selling cheap CDS, maybe they should have done better DD on their CDS pricing and risk-management. You can't name one healthy company in history that was done in by false rumors or market manipulation. If AIG sold insurance, and AIG has money available to pay it (thanks to the gov loan, which is arguable), they must pay. They entered the transaction freely and profited at the front end. Time to pay the piper.
    Oct 17 20:48 pm |Rating: 0 0 |Link to Comment |View article
  • Morgan Stanley in the Crosshairs
    Goldman's: Do you have any evidence whatsoever? No? Ok.

    I don't know why it's so hard for all of you to understand that shorts don't drive stable, profitable companies into bankruptcy. There's a huge amount of competition in the markets, and you don't find a lot of dollar bills that only cost 50 cents because people tend to snap those up. If shorts drive a stock down to half its true value, there are tons of value investors looking to buy that stock. If the company has articulate management with some capital to deploy, they can buy back shares or make a few insider purchases, then try to make shares scarce so that shorts can cover. Ultimately you get a squeeze and the share price rebounds back to where it ought to be.

    What shorts do is hasten the end of companies that are limping along, that can't make any credible presentation to investors regarding solvency and profitability, that can't afford to buy back any shares, that no value investor will touch.

    Naked shorting should be illegal because it makes no sense (selling something you don't have - take it to the options market, not the stock exchange). Now that it's taken care of, please stop obsessing over the non-existent problem of conventional shorting.
    Sep 18 00:55 am |Rating: 0 0 |Link to Comment |View article
  • Financials Buying Opportunity Close at Hand
    Stewie: Of course there are problems with bankers. If you want to see what happens when the dentists try to do better, check out prosper.com. A person who wants a flexible investment that preserves capital and returns acceptably has no alternative but to deal with the banks. Also we're never going to see an America where people regularly pay cash for houses. The banking industry as a whole will find a return path to profitability - this isn't the airline industry.
    Jun 24 22:46 pm |Rating: 0 0 |Link to Comment |View article

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