Kinabalu

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    • Mon Dec 1st 12:38 PM
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      Rating: +1 0
      Commented on:
      How Much Does the Bailout Really Cost?
      "some estimates are as high as $4.6 trillion dollars in total costs. So, we would be remiss in not sharing this shocking visual representation of the government bailout as it currently stands. The chart needs little explanation to get its point across"

      While acknowledging that $4.6 trillion is high for "costs", the author shows a chart that goes up to $7.4 trillion. This chart is ridiculous without any explanation. At least CaptainJJack was able to provide some points that make sense.
      View article »
    • Mon Dec 1st 12:11 PM
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      Rating: 0 0
      Commented on:
      Jerry Yang's Blunder - Worst Business Decision Ever?
      How about the FDIC decision to sell Wachovia Bank to Citi? At least that one didn't happen.
      View article »
    • Sat Nov 29th 18:49 PM
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      Rating: 0 0
      Commented on:
      Wall Street Breakfast: Must-Know News
      You may be right, and I agree, in the event no significant expense restructuring can be achieved, Congress should not provide any liquidity, and the solution should be Chapter 11.

      On Nov 29 03:46 PM LobsterM wrote:

      > Kinabalu,
      > Don't expect the UAW to agree on anything. That's their nature.
      >
      > Even if they (both) meet half way, it's still a giant burden to the
      > gov
      > and taxpayers. Still a giant Black Hole. The best solution will be
      > Chp.11. That way will leave them no option but to negotiate. Right
      > now, UAW still
      > think they are the king as they used to for half a century.

      View article »
    • Sat Nov 29th 12:27 PM
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      Rating: 0 0
      Commented on:
      Wall Street Breakfast: Must-Know News
      The UAW should understand that the only chance for their members to receive a full pension benefit, not to mention continued employment, is a healthy company. GM should be negotiating heavily for substantial adjustments to the union contract, and should offer explicit restrictions on executive compensation in exchange. The deregulation of the airline industry in 1979, and the subsequent 5 year adjustment period, offers a great model for how both sides should proceed.

      If these negotiations are not succcessful the most likely alternative is Chapter 11, which will absolutely result in adjustments to the Union contract and to executive deferred compensation arrangements. Congress will dilly-dally because of the political pressure but will ultimately do the right thing and not provide any bail-out funds unless Union and Management meet halfway.
      View article »
    • Wed Nov 26th 15:53 PM
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      Rating: 0 0
      Commented on:
      Tying Interest Rates to CDS Is a Recipe for Main Street Disaster
      "Recently, Bloomberg reported that several money center banks are inserting terms into loan documents that automatically adjust a borrower’s interest rates based upon the trading price of a borrower’s CDS"

      It astounds me that a CFO for significant company would even consider a financing with such a provision. As a financial executive for a capital intensive Fortune 500 company I learned early that sometimes you just have to say NO to the lender. Every time I did that we completed the financing within 3 months without the onerous provision.
      View article »
    • Wed Nov 26th 12:49 PM
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      Rating: 0 0
      Commented on:
      What Obama Needs to Know about Tim Geithner, the AIG Fiasco and Citigroup
      I have problems with your assumptions and your math. You assume $50 trillion of CDS. This is based on a voluntary survey where minor players vastly overstate their positions to self-aggrandize. I believe the actual number is a lot lower. The numbers for the companies that the government would actually consider a bailout for (like AIG) are far less. many CDS sellers were small subsidiaries of hedge funds that wanted the premium income but never had the financial wherewithall to pay off on any claims and would not be candidates for a bailout.

      You assume 40% will go into the money and asert this is conservative. I think this is a ridiculously high assumption but at least your math is correct ($50 trillion times 40% = $20 trillion).

      You assume a 25% recovery rate on those. This is the only reasonable assumption you use, however 25% of the ridiculously high $20 trillion = $5 trillion not $15 trillion.

      The fact that so many readers call this an excellent article without questioning either the assumptions or the math is somewhat disconcerting.
      View article »
    • Thu Nov 20th 14:03 PM
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      Rating: 0 0
      Commented on:
      GM Could Benefit from Bankruptcy
      On Nov 18 05:52 PM d.dealer wrote:

      > utide,as a current gm autodealer my question is,would you buy a new
      > vehicle from a bankrupt company(your not buying a box of tide) <br/>

      In the heavily unionized airline industry we said for years that no one would ever fly a bankrupt airline (you're putting your life in their hands, not to mention the prepaid ticket). Then one declared bankruptcy and we found out that it was actually beneficial.
      View article »
    • Thu Nov 20th 13:30 PM
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      Rating: +1 0
      Commented on:
      My Reconsideration: Why Share Buybacks Are Pointless
      The comments pretty well cover the things the article missed. But one item not discussed, although dilettantedude hits part of it, is the effect of buybacks on executive stock options. Almost every public company has a stock option program and buybacks intrinsically make stock options more valuable. I have never seen a stock option that has its price or number of shares adjusted for the antidilutive effect of a buyback even though a buyback requires no executive management expertise to implement.
      View article »
    • Wed Nov 19th 17:53 PM
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      Rating: 0 0
      Commented on:
      Yet More Paulson Revisionism
      Felix, This is probably the worst article of yours that I've read. Usually you start out with a better idea and then do better research on it.
      View article »
    • Mon Nov 17th 18:53 PM
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      Rating: 0 0
      Commented on:
      GE, Goldman Bond Spreads: Unrealistic and Unsustainable
      On Nov 15 10:09 AM BS Detector wrote:

      > Based on the thinking behind the article, would you expect him to
      > be invested any other way? Are you as skeptical of somebody who's
      > bullish and long?

      My comment was based on the conclusion that the thinking behind the article was shallow and inconclusive. This is a "short & distort" article like many that appear on this site. The concept that bond buyers don't factor credit default risk into their pricing decisions is ridiculous. Could it possibly be that the CDS market pricing is off-base?

      Are you having a senior moment and forgot your earlier comment? "The CDS market is extraordinarily thin, with very few sellers, especially when compared to the corporate bond market. The thinner the market, the more likely pricing errors will occur."
      View article »
    • Fri Nov 14th 18:11 PM
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      Rating: +1 0
      Commented on:
      GE, Goldman Bond Spreads: Unrealistic and Unsustainable
      I think the authors disclosure tells you all you need to know about the point he makes in this article.
      View article »
    • Thu Nov 13th 14:18 PM
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      Rating: +1 0
      Commented on:
      Key Quotes from Thornburg on Mortgage Lenders
      You do a diservice to your readers by including excerpts of TMAs disclosure that highlight the doubling of their delinquency rates and the industry delinquency rate at June 30, 2008 of 8.25%, without noting that TMAs rate doubling was from 0.81% at June 30,2008 to 1.58% at September 30, 2008.

      TMA has always had far superior delinquency rates to just about any other mortgage reit.
      View article »
    • Tue Nov 11th 19:06 PM
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      Rating: +1 0
      Commented on:
      'The Market and the Internet Don't Care if You Make Money'
      The old rule of thumb was that it takes twenty years for a really new, great idea to be accepted. For example, index funds, or, Milton Friedmans thesis that money supply was the only economic indicator that mattered. So someone out there has probably identified the business model that will replace the NY Times. We just haven't accepted it yet. Scott, maybe it's you and your giant network. I hope its not just Google.
      View article »
    • Tue Nov 11th 15:28 PM
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      Rating: 0 0
      Commented on:
      Neel Kashkari Wants You to Read Between the Lines
      If only Congress could read between the lines.
      View article »
    • Sat Nov 8th 16:11 PM
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      Rating: 0 0
      Commented on:
      The Next Crisis Is on the Horizon
      "There are a lot of technical ways for the Treasury to effectively raise taxes on Treasury securities and lower them for other types of lending"

      Mark:
      If I understand the second item in your comment, You are talking about Tax Regulations. I would agree that the Treasury has great power in that area. However, to my knowledge they have never used that power in an economic stimulation context, i.e. outside the normal, time consuming, proposal - comment - final regulation process. I am sure that if they did attempt to do so there would be some intense bureaucratic screaming from the direction of the IRS and from Congress.

      This is a much more revolutionary article than I originally thought.
      View article »