Category Archives: Portfolio

With Deutsche Bank saying that GM is worthless, and some kind of government bailout of Detroit now a certainty, the battle lines are being drawn: is bankruptcy an option? Justin Hyde says it isn’t, and he might well be right, … Continue reading →

Jim Surowiecki this week looks at what he calls "ancillary markets" — things like futures, the VIX, or credit-default swaps — and the effect they have on the stock market: Even if these ancillary markets aren’t being gamed, the attention … Continue reading →

This is the front page of nytimes.com earlier this afternoon. It’s a tough time to be a journalist: clearly moves like this are clearly newsworthy, but equally clearly it’s very hard to say anything intelligent about them. Hopes for a … Continue reading →

Of all the Big Ideas which have been thoroughly discredited over the course of this crisis, arguably the biggest is the concept that homeownership is always and everywhere a Good Thing. As we’ve seen over the past couple of years, … Continue reading →

Many thanks to Don Fishback, who alerted me to the fact that (with a lot of work) one can actually find reasonably up-to-date statistics on total uninsured deposits at the FDIC’s website. He did just that back in July, using … Continue reading →

You knew that someone was going to come out and say it. But did you know it was going to be Cramer? Shorts were able to take AIG down from the $20s to $4 in a week’s time. To be … Continue reading →

Logging on to my Citibank account this morning, I found this, which recapitulates an email I received a few days ago: The link takes you here, to a letter which simply begs for parsing. But before we get to the … Continue reading →

Equity Private, guest-blogging over at Dealbreaker, has the H2 2007 reports from Pershing Square IV, the Bill Ackman hedge fund devoted to going long Target. Which hasn’t worked out so well. He lost $52,872,231 on Target stock, which is bad … Continue reading →

Apologies for the late start this morning, I’ve had a combination of digital and meatspace problems (I thought I was taking an aspirin in the middle of the night; it turned out to be an ambien. Oops.) But one thing … Continue reading →

"FALL ST." is the headline splashed across the front page of the New York Post this morning. "Plunge sparks recession fear". OK, maybe Tuesday was a bit of a slow news day. But check out the causality there: it’s the … Continue reading →

Sam Heyman is a hedge fund manager, corporate raider, and merger arbitrageur. He came massively unstuck in Australia in May, when his merger-arb tactics relating to the acquisition Qantas by Airline Partners Australia were described as "an elaborate and cunning … Continue reading →

Mark Thoma today has an excellent (implicit) rebuttal of Larry Summers’s proposal that the US government use fiscal policy to fight impending recession. Both fiscal and monetary policy are capable of fighting recessions, Thoma says. But the thing about monetary … Continue reading →

One of the buzzwords in finance circles right now is "reintermediation". It’s the opposite of disintermediation, and it’s what happens when banks go back to old-fashioned lending, carrying assets on their balance sheets, rather than structuring deals between issuers and … Continue reading →

Yves Smith at Naked Capitalism submits: Michael Shedlock, of Mish’s Global Economic Trend Analysis, provides some uplifting charts and commentary that should quash any doubts that this housing cycle is worse than its predecessors: ….this housing cycle looks different than … Continue reading →

Moody’s warns of a possible rerun of the LTCM crisis. We should be so lucky.
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How do hedge funds get their outsize returns? And why do so many hedge funds
list "convertible arbitrage" as one of their main sources of profits?
Could the answer to both questions be "insider dealing"?
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"I like the idea of the report card—the stock price," Mel
tells Portfolio’s Nancy Hass. Does that mean he’s officially giving himself an F?

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The FT’s Alphaville blog has come out and declared that one of Bloomberg’s biggest stories today is a hoax.
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Bloomberg’s Doron Levin gets off a nice one-liner at Kirk Kerkorian today, and his bid for Chrysler – which, as you’ll recall, is contingent on the United Auto Workers taking on a huge chunk of Chrysler’s liabilities and risk. The bid, he says,

is a bit like proposing a manned mission to Pluto, subject to the invention of a spaceship that can traverse the solar system.

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Citigroup’s New York payrolls will only fall by 6% – which is less than the corporate average.
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David Leonhardt’s Economix column has finally been promoted from the front of the Business section to the main front page! Congratulations to him. And the subject matter is dear to my own heart: rent vs buy calculations. In fact, by far the best thing about the article is the online rent vs buy calculator – bookmark it, and use it whenever you or your friends are thinking of buying a place. It’s great.

Given his space constraints, one can forgive Leonhardt not going into gruesome detail about all the different variables which go into such calculations. But I would still take issue with a large chunk of how his story is framed.

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Add Michael Bloomberg to the billion-dollar-a-year club. DealBook reports that Fortune’s Carol Loomis has had an inside look at the books, and found 2006 profits of $1.5 billion on revenues of $4.7 billion. Given that Bloomberg personally owns more than two-thirds of the company, his share of the profits would seem to be in the ten-digit range.
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Get paid to plug your car into the mains!
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If you’re going to insist on some kind of reason for the fall in the peso, the Cemex-Rinker announcement has to be much more compelling than a bunch of old news about the US housing market.
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It was probably inevitable, but that doesn’t make it any less depressing. Barney Frank has now come out and said that investors in mortgage-backed bonds should be liable for the underlying loans.
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