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Posted
Sep 15 2008, 02:54 AM
by
Jon Markman
Rating:
Money Blog: Top Stocks Blog - MSN Money
The fate of the world financial system hangs from a thread today after the New York office of the Federal Reserve stood up to the big Wall Street financial houses on Sunday and essentially told them, "thanks but no thanks" on their request for a bridge loan to nowhere.
It's about time. For years, the country’s major broker-dealers and banks have competed with each other to become the No. 1 underwriter of loans, bonds, mergers, mortgages, swaps and equities. The industry’s compensation system is focused on rewarding managers who took big risks, and could bring home top rankings in dealmaker lists.
All the while, banks figured that if they really got into trouble, the federal government would back them up with taxpayer funds. And the government reluctantly complied twice this year, backing up the reckless behavior of high-flying bankers at Bear Stearns in March, and Fannie Mae and Freddie Mac last week with loan guarantees costing untold billions
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Posted
Mar 13 2009, 08:38 AM
by
Charley Blaine
Rating:
Money Blog: Top Stocks Blog - MSN Money
Before CNBC's "Mad Money" Jim Cramer went on Comedy Central's "The Daily Show" Thursday night, he pounded on pie dough with a roller during a visit with domestic diva Martha Stewart.
"Daily Show" host Jon Stewart got into fighting trim with pop quizzes on the definitions of various financial terms, like price-earnings ratios and Tier 1 Capital.
But when Cramer actually appeared on the show, he was as gentle as, well, a kitten.
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Posted
Sep 29 2008, 01:09 PM
by
Jon Markman
Rating:
Money Blog: Top Stocks Blog - MSN Money
Members of Congress shocked the world today by voting down legislation aimed at resolving the U.S. credit crisis, evidently determining that it was far from the comprehensive rescue plan that its promoters claimed and instead was just a handout to fatcats. Investors responded by throwing a fit, punching the Dow Jones Industrials Average down 778 points.
The House move was one part nihilism, one part bluff-calling and one part an expression of total constituent outrage, and only history will be able to judge if representatives' snub of their political leadership will rank among the greatest blunders of all time or a brave move of principle. Both views will have their day in court, for dispassionate analysis
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Posted
Mar 25 2008, 03:58 PM
by
Charley Blaine
Rating:
Money Blog: Top Stocks Blog - MSN Money
Al Copeland died on Sunday. You might not know the name. In Louisiana and certainly around New Orleans, he was about as well known as anybody both for the chicken you can get at Popeyes Famous Fried Chicken, the chain he started, and for his lavish, complicated and exuberant lifestyle.
He liked getting married. But all four of his marriages ended in divorce -- often acrimoniously. He liked Christmas. His house along Lake Pontchartrain in Kenner, La., was so lit up with lights at the holidays that airline pilots would use it to line up their approaches to the airport.
He liked fast cars and fast boats. He carried on a fun feud over the decor of one of his restaurants with no less than Anne Rice, the author of "Interview with the Vampire."
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Posted
Jun 26 2008, 01:18 AM
by
Jon Markman
Rating:
Money Blog: Top Stocks Blog - MSN Money
It’s easy to imagine that the 25 best-performing stocks in the S&P 500 Index this year are all oil and gas producers, and the 25 worst-performing stocks are all banks and brokers. Yet as we near the halfway mark in 2008, it turns out that there are quite a few surprises in the mix of best and worst.
For instance, the No. 1 stock in the benchmark index this year isn’t an oil producer, but a coal miner, Massey Energy. It’s up 155% so far, rising to $89 from $35 as coal prices have soared in the wake of booming demand in China and India. The No. 2 stock is actually a discount retailer, Big Lots. It’s up 100%, from $15 to $30, as investors speculate it will get a big share of tax-rebate money from low-income Americans.
Most of the rest of the next best 15 gainers
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Posted
Nov 20 2008, 09:48 AM
by
Jon Markman
Rating:
Money Blog: Top Stocks Blog - MSN Money
Shares of Warren Buffett's insurance holding company are on the ropes this month, plunging 30% in part because the famed investor dabbled in an area of the market he has long publicly derided: derivatives. And due to a tangled web of financial relationships, they may be taking Goldman Sachs shares down with them.
Investors are concerned about a $37-billion bet that Buffett made last year that U.S. and world equity values would be higher in 15 to 20 years than they were then, when the Dow Jones Industrials were trading around 13,000. Through his firm, Berkshire Hathaway, Buffett sold option contracts, known as "naked puts" to an undisclosed group of investors for around $4.85 billion, reportedly using Goldman as broker.
The buyers saw the puts as a type of insurance that would pay off royally if stocks fell over the next decade. They were seen by Buffett as an easy way to pocket a quick $4 billion-plus, which
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Posted
Sep 22 2008, 01:51 AM
by
Jon Markman
Rating:
Money Blog: Top Stocks Blog - MSN Money
Watching Treasury Secretary Henry Paulson make the rounds of Sunday morning television shows to make his case for applying a trillion dollars' worth of CPR to the U.S. banking system, I was struck by the prosaic quality of his argument. You sure didn’t have the sense that he thought this was any big deal. I mean, it was almost the same tone as you’d hear on a recorded message of the day’s surf forecasts. Wake me when we’ve spent all our money.
The humdrum quality of technocrats like the former Goldman Sachs chief makes me wistful for the days of Franklin Delano Roosevelt. Now there was a guy who was mad as hell about the state of the banking system, and wasn’t going to take it anymore. And could he ever deliver a speech.
FDR’s Inaugural Address in 1933 – in which he excoriated bankers for their greed, selfishness and incompetence -- was his most famous, and you may be amazed to discover how relevant it sounds today. "There must be an end to speculation with other people's money!" he said.
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Posted
Oct 08 2007, 11:38 AM
by
Matt Koppenheffer
Rating:
Money Blog: Top Stocks Blog - MSN Money
In the ongoing fessing-up process on Wall Street, Bank of America and JPMorgan are expected to join the parade of firms disclosing write-downs on mortgage and leveraged loans. At an estimated $2 billion-plus for JPMorgan and $1 billion for Bank of America, the losses are certainly not insignificant. However, for a $230 billion company like Bank of America the losses are relatively small, particularly when we look at some of the other firms that have been reporting.
I am still stuck on the losses reported at Merrill Lynch. Well in excess of $5 billion, these losses are quite significant for a $64 billion company. As I mentioned previously, the market seemed to digest these huge losses in part because it had been preparing itself for them for a while now.
Could losses like these really come out of the blue for Merrill? Well, the market didn't seem to doubt they were on the way -- Merrill's stock price dropped 19% between the firm's second quarter earnings release and early August despite the fact that Merrill beat analysts' second quarter earnings estimates. So how was Merrill itself out of the loop here?
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Posted
Apr 04 2008, 07:55 PM
by
Charley Blaine
Rating:
Money Blog: Top Stocks Blog - MSN Money
There are enormous amounts of chatter about whether the markets have bottomed.
So, what's the evidence?
The market itself. Down as much as 18% in January from its Oct. 9, 2007 all-time closing high, the Dow Jones Industrial Average's loss has been trimmed to 11%. The Standard & Poor's 500 Index, briefly down 20% on March 17 from October in the turmoil over Bear Stearns, is now off 12.4% from its October peak. And the Nasdaq Composite Index's loss from a peak on Oct. 31 has shrunk from 25% on March 17 to 17% on Friday. OK, let's turn the thought around. The Dow is up 8% from its lows in January. The S&P 500 and the Nasdaq are both up 9% and 10% off their lows on March 17. Lastly, the S&P 500 moved above its 50-day moving average on March 24, briefly dipped under it and has moved above it again. Moreover, the moving average has started to rise for the first time since November.
The Federal Reserve. Ben Bernanke & Gang have made it clear they won't allow the financial system to collapse. That was the result the Fed and many on Wall Street had feared would happen if Bear Stearns had been forced to file for bankruptcy protection. Instead, Bear Stearns has agreed to be acquired by JPMorgan Chase
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Posted
Jun 05 2008, 02:50 PM
by
Matt Koppenheffer
Rating:
Money Blog: Top Stocks Blog - MSN Money
Are we going to get an encore showing of "The Amazing Disappearing Investment Bank?" Now that Bear Stearns is no more, the banking bears and short sellers have turned their attention to fellow investment bank Lehman Brothers.
With the massive leverage ratios that the investment banks have propped themselves on, creditor confidence has become a prized asset -- maybe the prized asset. There was plenty that was going haywire over at Bear, but it ended up being a complete and rapid drying up
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