Submitted by Bridge Street on Sat, 2008-01-05 12:03
The springbok of southern Africa, combined with some simple mathematics, yields useful lessons for investors. A springbok is a deer-like animal that, according to Wikipedia, forms some of the largest migratory herds ever recorded. Imagine now that you are a springbok in a herd with 99 other identical springbok walking around the barren wasteland that is Africa (though there appears to be some greenery in the south). Further imagine that you are a particularly intelligent and mathematically-gifted springbok who calculates
Submitted by Bridge Street on Fri, 2007-12-07 23:37
Bloomberg reports that Standard & Poor's has "lowered credit ratings on capital notes of 13 structured investment vehicles and placed debt of 18 SIVs on negative outlook as the funds struggle to finance themselves." In what seems to be the typical situation in today's world of high finance, a credit rating agency has downgraded risky investment vehicles just in time for those who lost money to see why they lost it, but too late to do anything about it. If you will think back with me to th
Submitted by Bridge Street on Tue, 2007-12-04 10:32
I note that the yield curve is finally sloping upward again. This is interesting because downward sloping curves often precede recessions, yet the curve regained its upward slope right around the time many Economists/ pundits/ would-be experts believe the U.S.
Submitted by Bridge Street on Fri, 2007-11-30 15:18
In response to yesterday's Bridge Street Journal about various financial companies taking big hits due to not heeding the investing advice found in the scriptures, George asked which financials appropriately prepared for the current lending problems. He noted that it appears that Goldman Sachs and Berkshire Hathaway did and asked which others I thought may have as well.
Submitted by Bridge Street on Thu, 2007-11-29 08:33
Yahoo Finance reports that E-Trade Financial is selling a $2.5B stake to a private equity firm (Citadel) and firing its CEO. It seems that financial writers can make a template with fields like "Company Name," "Amount of Writedown," "Amount of Cash Infusion," "Percent of Stake Sold," and "Name of Ousted CEO," and then have Microsoft Word automatically generate a story upon each day's news. It was only a few days ago that Citigroup announced it sold a $7.5B stake to the Abu Dhabi Investment Authority (
Submitted by Bridge Street on Mon, 2007-11-19 17:49
Submitted by Bridge Street on Sun, 2007-11-18 14:23
Submitted by Bridge Street on Mon, 2007-11-12 11:44
Submitted by Bridge Street on Fri, 2007-11-09 09:03
Submitted by Bridge Street on Wed, 2007-11-07 23:08
Submitted by Bridge Street on Tue, 2007-11-06 17:03
Submitted by Bridge Street on Mon, 2007-11-05 22:15
* Yahoo! Finance reported on Citigroup's continued fall today, as CEO Chuck Prince resigned and slithered away in shame, the bank announced it would take an addition $8B - $11B in charges from bad debts, and uncertainty remains over the status of yet more debt instruments that don't show up on its financials, but for which it is still on the hook. Though this posting is not primarily about valuation, I thought it might be useful to consider the following.
Submitted by Bridge Street on Sat, 2007-11-03 12:23
Marketwatch claims that Chuck Prince, CEO of Citigroup, may be resigning in the very near future. This all comes in the wake of the mega-bank taking large subprime-related charges, with prospects of more to come. Oh, the shame and disgrace! Oh, how the mighty have fallen!
Submitted by Bridge Street on Fri, 2007-11-02 12:57
* The New York Stock Exchange (shares of which trade as NYX on the New York Stock Exchange), which bought Euronext (the European stock exchange) last spring, reported 3Q07 earnings of $.97/ share versus $.43 per share in 3Q06. The results are mainly due to top-line (revenue) growth, as revenue went from $602M in 3Q06 to $1.2B in the current quarter. The article notes that a full quarter of this revenue was from derivatives trading. There are a few points of interest here:
Submitted by Bridge Street on Thu, 2007-11-01 21:29
* Yahoo! Finance reports that foreclosure filings doubled between the current quarter and the previous quarter. As any literate fool could have predicted years ago, the ARMs are resetting and are going to continue to do so for another year or two, leading to increased foreclosures. The real estate bubble was interesting in its predictability.