Preferred Stocks
By Barry Ritholtz - March 10th, 2009, 4:30PM
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Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data, ability to repeat discredited memes, and lack of respect for scientific knowledge. Also, be sure to create straw men and argue against things I have neither said nor even implied. Any irrelevancies you can mention will also be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.
March 10th, 2009 at 4:41 pm
in a perfect world…..
March 10th, 2009 at 4:44 pm
At least two of them will end up getting even more taxpayer money.
March 10th, 2009 at 4:46 pm
needs their Names..
or, to play with a well-known turn of phrase, maybe they should be treated like Livestock..
March 10th, 2009 at 4:47 pm
Un-Preferred stocks:
http://money.cnn.com/2009/03/10/news/economy/moodys_bottom_rung/index.htm?postversion=2009031012
Moody’s unveils most-likely-to-default list
March 10th, 2009 at 5:01 pm
Awesome. Where are my rotten eggs?
March 10th, 2009 at 5:19 pm
Where is Larry Kudlow?
Seriously, though, our problems are not the fault of six men. Capitalism works beautifully, but it only works as hard and as well as we do. Alas, the system is not heat-and-serve.
March 10th, 2009 at 5:22 pm
They could set up the stocks on a village green in Olde Greenwich this spring. Lovely.
Hedge funds to lay off 20,000 employees. Leftback would preferably be long of Swedish models and short of Greenwich residential and commercial real estate.
March 10th, 2009 at 5:28 pm
This sentiment is a cartoon because the desideratum will remain just beyond reach.
The STATE is in a death match with the CORPORATION. None of these individuals will be brought to heel until the definition of juridical personhood is rewritten.
And I end with a Hofferian flourish:
http://www.merriam-webster.com/dictionary/desideratum
March 10th, 2009 at 5:33 pm
What’s really sad is that if it weren’t these 6 men it would be 6 other men. If any one of these CEO’s of a huge public firm tried to do what was right and minimize their risks they would have been fired. Their short term “profits” would have lagged their competitors and “shareholders” would have been upset. What a world.
March 10th, 2009 at 5:35 pm
@MRegan-
oh boy- those some big fancy words you be using
March 10th, 2009 at 5:46 pm
CNBC Sucks @ 5:19
After 17 months and more than 50% down, Kudlow finally admits that he is getting “tired” of the bear market.
I suppose if the SPX is below the 700 level six months from now, he’ll then admit to being “displeased” with the bear market.
March 10th, 2009 at 5:53 pm
O/T, boy I hope no one is still holding onto SRS and SKF – Yikes! These bear market rally’s are a killer to some sectors who still have a lot of shorts in them.
Steve B., you took one on the chin today. Are you still as bearish as ever?
March 10th, 2009 at 6:01 pm
to MR’s point, above:
for those who may think clicking links, a la George Jetson, is, too much, like hard work work..
de·sid·er·a·tum (d-sd-rtm, -rä-)
n. pl. de·sid·er·a·ta (-t)
Something considered necessary or highly desirable: “The point is not that the artist has ‘penetrated the character’ of his sitter, that commonplace desideratum of portraiture” Robert Hughes.
——————————————————————————–
[Latin dsdertum, from neuter past participle of dsderre, to desire; see desire.]
The American Heritage® Dictionary of the English Language, Fourth Edition copyright ©2000 by Houghton Mifflin Company. Updated in 2003. Published by Houghton Mifflin Company. All rights reserved.
http://www.thefreedictionary.com/desideratum
as MR shows, sometimes, the right words are irreplaceable, even with synonyms..
http://www.thefreedictionary.com/synonym
(:
March 10th, 2009 at 6:24 pm
Thanks, DL, for the heads-up, but never mind Old Man Kudlow.
March 10th, 2009 at 6:49 pm
preferred stocks beats the hell out of debt row
March 10th, 2009 at 6:58 pm
John Doe….so what you’re saying is, our highly paid CEO’s are hired to have no vision other than to do what everyone else is doing in order to achieve similar profits. How about this, what if just one of them had gone to their boards and laid out for them just exactly what the other firms were doing to achieve their profits, and then laid out a plan where his bank, rather than jumping into the subprime et al cesspool, placed their bets on the other banks stock, housing stock, copper stock, and everything else that was going up courtesy of the bubble. I would think their profits would have at least been in line with their peers, if not greater, and the benefit would have been, they could have exited as the meltdown started, and would presently be the only bank in town with no writedowns, zero, and no toxic assets, zero. Of course what am I talking about? I mean you’d have to pay a guy like that a lot of money, I mean like a lot, maybe even like 20 million a year or so I would guess.
Secondly, shareholders don’t own a company, so I wouldn’t be too worried about pissing them off. As we have seen, the Boards and the CEO own the company.
Course another way you could go, is to hire a real CEO like Steve Jobs, who has vision, and has had a disdain for Wall Street that the rest of us are just now beginning to appreciate.
March 10th, 2009 at 7:21 pm
Reminds me of my “Rolling Heads” suggestion for the new Big Picture logo
No?
March 10th, 2009 at 7:31 pm
They are luck this is not China or their families would be receiving the bill for the bullet. Let’s see how Peter Schiffs’(sp) China deals out justice when things get ugly.
March 10th, 2009 at 7:36 pm
I’ve been wondering…
What exactly is Doug Kass’ motivation for making his “generational low” bottom call on the S&P 500? Here’s a guy whose analysis I respect greatly, but I’m wondering why he’s making this call nearly every day now on Kudlow’s show. I can see a bear market rally, a la Barry Ritholtz or Marc Faber, but he seems awfully sure of himself…
HCF
March 10th, 2009 at 7:44 pm
I would buy a ticket to America tomorrow if there was any chance ….
March 10th, 2009 at 7:52 pm
For the situation that we are in, that is 10 times worse than Enron and Worldcom combined:
Where is Congress?
Who is holding hearings?
What agencies are doing any investigating?
Where are the grand juries?
What other fraud needs to be investigated?
Who in Washington is asking the questions that need to be asked?
Anyone . . . Bueler . . . Anyone??
Therefore,
Never Re-Elect Anyone
http://farm3.static.flickr.com/2362/2262571545_57cc78f185.jpg
March 10th, 2009 at 8:32 pm
Dearest Ahab (but I think I’ll call you Starbuck)-
Those words are for your edification and Mr. Hoffer’s entertainment. I suppose I’m too quixotic in my communicative strategy. Some people get it. Try to get this: what was I doing in San Martín de Pangoa in Oct 1991?
@MHoffer- I’ll try to earn an ‘often’.
March 10th, 2009 at 8:42 pm
Off-topic, but is anyone else a betting a bit uncomfortable with the thought that we may find out the real truth behind the Madoff scheme? Seems to me there’s going to be no trial. Will we ever learn the real truth?
March 10th, 2009 at 8:42 pm
MR,
sorry ’bout that, poor sentence/syntax, on my part.
I meant: “sometimes the right words are irreplaceable”.
as I’ve mentioned before, good thing I’m not a ‘Cleric’, b/c my clerical skills suck..
March 10th, 2009 at 8:49 pm
Republican Ritholtz edited away the link to my last comment about Erin Burnett’s noontime showers. What a dastardly deed!
People are starting to associate Ritholtz with The Great CNBC Sucks in the blogosphere. There is now a halo effect, and soon, complete confusion in the market!
When you see Republican Ritholtz on TV, always think: “CNBC Sucks commented regularly on that guy’s blog.”
March 10th, 2009 at 8:56 pm
Jeff, you make me feel so old and cynical… oh, and i’ve got a big birthday coming up. Momentous mid-life crisis material. What to do, what to do…
March 10th, 2009 at 9:02 pm
MH-
No worries. Let’s keep the syntax open ended and polyvalent. That way I stay on my toes.
March 10th, 2009 at 9:02 pm
@karen: Am I too young for a mid-life crisis at 38 (39 in a few months)? I’m feeling one coming on myself……or maybe it’s just a case of heartburn from this nightmare. I need another vacation. Life sure is a lot more pleasant when you can pretend none of this is happening while away enjoying the sun and warmth of a warm climate.
March 10th, 2009 at 9:04 pm
Jeff,
with ‘people’ like Arlen Specter(R-PA) still around, maybe we’ll find out in 2084..
http://www.informationdelight.info/encyclopedia/entry/Warren_Commission
March 10th, 2009 at 9:09 pm
Hey, since Obama was so clearly responsible for the losses, shouldn’t today be the Obama Budget Rally, since congress sent him the budget to sign? (and then tomorrow the Obama Cliff Dive or the Obama Flatline or whatever)…
March 10th, 2009 at 9:09 pm
MR,
yeah, just what everybody needs~-nothing like distilling clear meaning from polyvalent syntax..
(:
March 10th, 2009 at 9:21 pm
This from Bill Bonner of The Daily Reckoning says it all:
At least Dick Fuld got rich honestly – by misleading investors. Even Bernie Madoff made his money, too, the old-fashioned way – like a gigolo – by defrauding investors, one at a time.
But now the whole thing has been turned over to the big boys. Now we’re getting theft and fraud on a much bigger scale. Trillions of dollars are being given out by politicians and functionaries. AIG, for example, has been described as ‘where taxpayers’ money goes to die.’ But it doesn’t die in AIG – it goes to pay off debts to the biggest boys left in the room – Merrill and Goldman Sachs. ‘In the room, in the deal,’ they say on Wall Street. Goldman was actually in the room with Tim Geithner and the feds – the only investment bank present – when the decision was made to ‘rescue’ AIG. Goldman may not have mentioned it at the time, but AIG owed Goldman billions of dollars. Now, the taxpayers bailout AIG so that Goldman can get its money.
So WHO ELSE IS IN THE ROOM?
March 10th, 2009 at 9:31 pm
@mregan
San Martín de Pangoa- I am almost certain that is in Nebraska- and in 1991 . . . well in Nebraska . . . I don’t know there are so many things you could be doing in October- please enlighten me.
March 10th, 2009 at 9:44 pm
Not good enough. Here are some fine examples of a much better, “old school” device. Check out these bad boys.
http://www.guillotine.dk/Pages/Gallery.html
March 10th, 2009 at 9:53 pm
jeff, oh, no. you are in one. i had one at your age and am having another 10 years later. exercise is the best medicine… although, making $$$ is fun, too.
March 10th, 2009 at 10:00 pm
@karen: I’m already doing a lot of exercising and that helps a little. Digging up some old music and listening to that helps too. Not making too much $$$ right now. Still running in place overall for the most part trading/investing (although my brokerage account up about 12% this year) for quite a while now and just got screwed out of $50K deal at the last minute a couple of days ago (long story but am not happy about it, obviously). Thank God my wife is still employed and has bene’s…..for now anyway. Not good times.
March 10th, 2009 at 10:09 pm
Barry,
This is off topic but it has to do with the absolute orgy of spending our taxes have funded for the detriment of our values as a people and a country. I say that the military and wall street are juined at the hip. This from the Alternet web ste:
Ex military
Posted by: jleman on Mar 10, 2009 6:27 AM
Being in the military during the last part of the sixties, I was stationed in northern Japan. The “reason” for the base was the security listening post which could pick up transmissions from around the world. In my specialty, to the rest of the world, people like me were only “based” in the continental US because outside the US we would be considered not defensive but aggressive. Military double speak. Covered in layers of secretiveness.
The point is, we had this great golf course. Many of the bases did. For the regular Japanese to pay for green fees to play golf, it is cheaper for them to fly to Hawaii or the States to play – unless they were “in” with the US military.
During my time at this base, I learned that sometimes the person running the show was the head enlisted man, and having shown many visiting brass, including congress people, a “good time”, including photos for later “leverage”, nothing was beyond doing if it would bring more power.
Main defense manufacturers weren’t beyond graft and corruption. And, they were never charged nor were facts ever shown the light of day even though reported up through the chain of command. They put our military personnel at risk, and our country at peril, for their greed. Nothing, and I do mean nothing, was a limit on what they were capable of. And, it is all about the money and power.
Shut the bases down, and at any cost. The reason I say this, is that I know that even though they’ll find some way to screw us, at least we won’t be on the hook for that military base any longer. Starve the beast.
We spend more on the military budget than all country’s put together and that does not count for the wars we are fighting. It is time to rethink our goals or we will end up like ancient history.
March 10th, 2009 at 10:53 pm
I wish I had something more erudite to say, but all I can muster is:
Fucking bankers… (shaking my head is disgust)
Regards,
TDL
March 10th, 2009 at 11:20 pm
Wow!! Talk about how blogs can deteriorate into useless drivel!!! Get off on attempts at intellectual diversity when nothing of any meaning can be provided. Ha! Ha! Ha! Sometimes this blog amazes me.
March 10th, 2009 at 11:56 pm
Buying stocks vs http://en.wikipedia.org/wiki/Stocks . I love it.
March 11th, 2009 at 12:09 am
MEH –
RE “I meant: “sometimes the right words are irreplaceable”.”
Hoist on your own comma-petard? ;^)
RE MRegan’s
“The STATE is in a death match with the CORPORATION. None of these individuals will be brought to heel until the definition of juridical personhood is rewritten.”
juridical person – entity (such as a corporation) other than a natural person (human being), THUS the deficiency of corporate capitalism – the absence of the moral dimension – on which see earlier comment @
http://www.ritholtz.com/blog/2009/02/munger-on-reform-pain-leveraged-speculation/#comment-145499
from which
THE Problem: corporate person = limited liability = limited accountability
from the Munger piece: “insufficient controls over morality and prudence in banks and investment banks”
Banks as corporate entities do not and cannot have morality or prudence; only real persons are capable of either and if those persons who control corporations have little or no morality or prudence…, we get what we have today.
A good read – “How Corporations Became ‘Persons’” http://www.uuworld.org/2003/03/feature1a.html
The amazing true story of a legal fiction that undermines American democracy. From which I learned that constraints on corporations were eroded away over the decades by Supreme Court decisions that ended up establishing the corporate “person” which has virtually the same standing in law a real person except the corporate person cannot do hard time in a Federal pen.
“”Corporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands and the Republic is destroyed.” – A. Lincoln
March 11th, 2009 at 12:28 am
what about:
fed head
and for the democrats around here (I’m surprised no one came up with it):
ditto heads
March 11th, 2009 at 12:28 am
“”Corporations have been enthroned and an era of corruption in high places will follow, and the money power of the country will endeavor to prolong its reign by working upon the prejudices of the people until all wealth is aggregated in a few hands and the Republic is destroyed.” – A. Lincoln
batmando,
nice post. and, that quote, above, is a part of Lincoln’s past body of work that today’s Politicians, (R) & (D), Never bring up..
March 11th, 2009 at 1:23 am
C takes GE price target to 9 from 12 tonight and raises GE Capital Services losses by another billion.
I trumped Bloomberg with this breaking news. They don’t even have the story!!! I had to give it to them!!
https://twitter.com/BostonWealthMan
March 11th, 2009 at 2:27 am
Breaking News Confirmed by Bloomberg:
By Patrick Rial March 11 (Bloomberg) — General Electric Co.’s share priceestimate was lowered 25 percent to $9 by Jeffrey Sprague, a NewYork-based analyst at Citigroup Inc. Sprague cut his earnings estimates for 2009, 2010 and 2011,citing the possibility of additional losses at the company’sfinancial services unit.
Link to Company News:{GE US CN }
For Related News and Information:
March 11th, 2009 at 6:42 am
@AGG:
Let’s say we reduce ALL government employment, military and civilian, closing bases, creating a no nonsense budget, eliminate all waste and inefficiencies, etc.
What would the millions if not hundreds of millions (a billion?) do with their newly found time, no applicable skills to the work that does need doing, and resultant massive unemployment?
It’s gradually becoming clearer to me that there are simply too many people on the planet who need something to do with their time. Perhahps a billion too many and growing thicker every day.
“Player Piano”, a novel by Vonnegut, attempts to portray just such a scenario. When I first read it
a long time ago, I found it outlandish. But now I realize he foresaw the consequences of rampant job destruction, and the paucity of job creation more clearly then. My guess is so did some of the eggheads in military and other government entities.
What are we to do with the world’s burgeoning population? One day (if there is not a revolution) if not retired and living comfortably, many will be working in some mindnumbing, highly unproductive relatively meaningless effort to ‘earn’ a paycheck, with a few people in control of the world economy.
As stupid as some of job creation programs seem to be, like the $2,000,000 bike path being authorized for our area in the stimulus package, there will likely be more and more of them just avoid the extremes of civil unrest that would surely follow 15-33% REAL unemployment.
There does not appear to be any combination of job creation efforts but those instituted by governments.
If anyone does have any huge job creation possibilities let’s hear them now.
March 11th, 2009 at 7:18 am
flip,
do you have an idea of how much work there is to do just retrofitting basic water delivery infrastructure?
I’ll bet the water-delivery pipes, nearby your U$D 2MM boondoggle, are greater than 40 years old, and are, currently, leaking..
that’s Only the retrofit side of it..
wanna guess how ‘underserved’ locales like the ‘Jersey Shore’ are? I’ll give you a clue, there’s a big reason why there are long pipes into the Ocean..the water treatment facilities can’t handle the ‘Summer peak’ of tour-on influx..
Dude, it goes and on, save us the friction of Fiction, we’ve more than enough Fact to deal with..
faery-tales about how we need to employ Soldiers to break things, and kill people, lest they be ‘unemployed’, is really stupifying..
you go w/ : “One day… many will be working in some mindnumbing, highly unproductive relatively meaningless effort to ‘earn’ a paycheck, with a few people in control of the world economy.”
One day?, bud, do you mean 11 March 2009?
we’ve an ersatz Economy predicted upon Consumption Velocity, a Financial Pachinko parlor where the vast majority are thought of as little more than steel balls levered onto the playing field..
the biggest conumdrum is whether this guy:
The masses have never thirsted after truth. Whoever can supply them with illusions is easily their master; whoever attempts to destroy their illusions is always their victim.
~ Gustave Le Bon
is correct, or not.
if he is, then what you allude might be sensible, along with the actions of the “Scientists” that went to Alaska to recover the DNA of the 1918-9 “Spanish” Flu..
“Oct. 2005: Using a technique called reverse genetics, scientists at the Armed Forces Institute of Pathology recreate the 1918 virus. They recovered the genome information from a flu victim who had been buried in Alaskan permafrost since 1918.”
http://www.twoop.com/medicine/archives/2005/10/1918_spanish_flu.html
should be good times..
March 11th, 2009 at 8:36 am
OK, that’s one avenue: Water infrastructure. How many millions do you think that would employ and how would it be paid for? In the average consumer’s waterbill, i.e. the strapped taxpayer who is unemployed?
LeBon is correct. I know that friends and associates FORBID conversation about the vast problems we face at parties and just in general socializing.
Only activists encourage this kind of brainstorming, they amount to a fraction of a fraction and are usually highly partisan, and when I confront them with the fact of their own guilt in re-electing incumbents who fraudulently and corruptly engineered this mess, 99% of them don’t wish to discuss it any further. They will accept no blame for not turning out incumbents.
I’m afraid New Jersey’s problems and water infrastucture wouldn’t do a whole lot to employ the millions of current and future numbers of people who will need work. But it’s a beginning.
Now we only need a hundred million more ‘careers’.
March 11th, 2009 at 9:03 am
flip,
see this: Dude, it goes and on, save us the friction of Fiction, we’ve more than enough Fact to deal with..
do you, really, believe it’s limited to NJ?
also, are thinking clearly? you point to: “Let’s say we reduce ALL government employment, military and civilian, closing bases, creating a no nonsense budget, eliminate all waste and inefficiencies, etc.”
then, ask: “how would it be paid for? In the average consumer’s waterbill, i.e. the strapped taxpayer”
bud, I’ll give you a clue: 4-2=2
March 11th, 2009 at 9:22 am
Frankly, I don’t care where job creation comes from, whether it is miltary, civilian, private or institutional. My overwhelming preference is for private industry to do it, but there is not now any industry that is capable of expanding employment. They are on a tear to REDUCE headcounts for the next 100 years.
Without the private sector to absorb the hundreds of millions whose jobs are continuing to disappear, the massive unemployment in Asia, Europe, Russia and elsewhere only government seems to be adding people and only at the Federal level.’
My essential point is to get people working again and new entries into the labor force is going to require
paradigm changes in our thinking about government’s role in keeping people busy, however they do it.
If that means that Nevada, the Southwest and Californica need water solutions so be it. Only government will be able to let contracts for that. If it means working on Jersey’s and Florida’a sewage problems only the government can do that. We seem to be saying the same thing. I think.
March 11th, 2009 at 9:37 am
flip,
the difference may be that you today’s wage/price scales are in tune..
I think wages and prices could, and need to, fall.
seems that you want to support the current w/p paradigm w/ add’l “gov’t” borrowing..
I’d say that a big reason our w/p structure is so far out of whack, to begin with, is b/c of the borrowing, of all sorts, that we’ve been doing, to date..
LSS: the World is only so big, we’ve created waay too many ‘units’ to account for it..
March 11th, 2009 at 10:13 am
I just realized the second law of thermodynamics is a make work project! ;)