There is also a report that around 1000 regional or local banks may also fail in the remainder of the year so that will hurt a little as well. There may be more to come with Merrill but I'm sure Bank of America will just buy everyone and become the Bank of America, haha

 

www.calculatedrisk.blogspot.com

 

It looks like pretty much all bank stocks are down - time to find those with the least amount of debt liability and buy up their stock.

 

Looks like Barclay's has finished talks with Lehman to purchase some of their assets and different business units. Being a broker, I saw a ridiculous amounts of buys today and then everyone getting screwed at 3pm when trading was halted. I don't think I would have touched it with a 10 foot stick, but to each his own.
https://www.reuters.com/article/mergersNews/idUSN1644330920080916

 

If you look at pre-Reagan years every year Big Old Name Companies went under. So, this is not unusual.

For the rest of your life this Big Old Name Companies going under every year will probably be normal again. Why? Because, nobody has a crystal ball to see into the future. Therefore, leaders of companies don't always step in the right direction or they go to far. If your investments are scattered you won't loose much, if anything, since the other companies may have earned more. But, if you plopped all your money into one company you may loose all.

 

It is definitely an uncertain time here in the US. Personally, if I were to invest in more bank stock, I think I would consider JP Morgan Chase

 

Bank of America is looking pretty good from a capital stand point and that they are broadening their base. But they may have taken on a bunch of bad assets with Countrywide and Merrill, but they will probably make it work for them. Hopefully atleast.

 

If you look at pre-Reagan years every year Big Old Name Companies went under. So, this is not unusual.

For the rest of your life this Big Old Name Companies going under every year will probably be normal again. Why? Because, nobody has a crystal ball to see into the future. Therefore, leaders of companies don't always step in the right direction or they go to far. If your investments are scattered you won't loose much, if anything, since the other companies may have earned more. But, if you plopped all your money into one company you may loose all.

The Lehman chairman got paid $140 million to run the company into the ground. I would have been willing to do it for half that.

 

The Lehman chairman got paid $140 million to run the company into the ground. I would have been willing to do it for half that.

Crazy. I certainly hope one of the lessons learned from this whole debacle is that executive compensation packages are so out of whack that to call these pikers "greedy" would be a vast understatement. I blame these companies' boards too, as they approve the bloated packages in the first place. From what I've read, the CEOs from Fannie and Freddie have similar sweetheart deals.

This just in....

The Fed is throwing $85 billion at AIG. Disgusting. I AM SO TIRED OF MY TAX MONEY BEING USED TO BAIL OUT PRIVATE COMPANIES.:devil:

 

https://www.nytimes.com/2008/09/17/business/17insure.html?_r=2&hp&oref=slogin&oref=slogin

I am not clear of what is really happening. I have not much knowledge in the economy.

So, what exactly is happening when the government bails out a company? AIG, in this case.

 

I think these ceo's should be forced to pay back all of what they make when they run companies into the ground.

I don't understand these boards that are so gullible. They also should be forced to pay back all that they make.

 

I don't understand these boards that are so gullible. They also should be forced to pay back all that they make.

It seems like the boards are usually composed of other CEO's and their friends, not the best group to be running oversight over a corporation.

 

It seems like the boards are usually composed of other CEO's and their friends, not the best group to be running oversight over a corporation.

Yeah, they are waiting their turn again (or they are a group of ceo's patting each other on the back with these scams) to become a ceo to scam the share holders, the bond holders, the employes, etc.

What I don't get is why are the share holders so gullible and have no back bone.

 

https://www.cbsnews.com/stories/2008/09/17/notebook/main4455247.shtml

In fact, the government doesn't have the $85 billion needed to bailout insurance giant American International Group.

The treasury department announced this morning it would auction new debt to raise funds for the Federal Reserve's rescue plan for AIG.

Wow, it is really just amazing that this sort of thing is allowed to happen.

 

Wow, it is really just amazing that this sort of thing is allowed to happen.

I agree. From what I understand, part of the deal involves AIG selling some of its meaty assets to pay off the loan. The interest rate is fairly steep too. One analyst on MSNBC today said the Fed could actually pocket $110 billion when all is settled. Regardless, this irritates me to no end.

If the Fed hadn't stepped in, what would have happened? AIG carries a lot of the liability cover for debt from the banking houses, so I can only assume AIG going insolvent would crumble the markets. As I have said before, I am not an expert on these matters. So, I will defer to fellow fora members to explain the alternative to bailing out yet another mis-managed, greedy, floundering company.

 

Gents,

I think what will happen is that we will have to form a Resolution Mortgage Corporation to work out of this mess, just like we did with the Resolution Trust Corporation (RTC) with the S&L crisis.

The economy is shaky undoubtedly BUT.....it does say something for the resilience of the economy that we have had two investment banks disappear, AIG effectively nationalized and oil at well over 100 USD for most of the year and yet the economy has (so far) chugged along. That being said I don't think the camel's back can handle another straw. I really hope JP Morgan steps up and buys WAMU bc a WAMU collapse would wipe out the FDIC reserves.

And did anyone notice that the Russian Central Banks had to inject 45 billion USD into the Russian banking system today? Let's all party like its 1998!

A certain REM song is appropriate right about now......

Karl

 

A certain REM song is appropriate right about now......

Karl

"End of the World"?

Good to hear from you, Karl.

 

TMMKC,

Thanks.

What about "Losing My Religion"? Perhaps "Everybody Hurts"?

 

Looks like another case of lemon socialism.

 

In fact, the government doesn't have the $85 billion needed to bailout insurance giant American International Group.

The government doesn't have anything. It has IOUs.

The FDIC is just another shell game, like Social Security. There's nothing there, no fund of assets ready to be used to start covering people's bank accounts when more banks start failing. All the government has from the "premiums" that banks pay are IOUs, just like like what happens to your Social Security taxes. There's no "lock box" and there's no actual fund. There never was.

Who has to fail next before people get the picture? Wachovia? Chase? Citigroup?

 

Ron Paul made an interesting point tonight on TV. He said that with all these bailouts, the Fed is essentially bypassing Congress's appropriations powers and just printing more money to bailout these companies, potentially in violation of the Constitution.

 

Ron Paul made an interesting point tonight on TV. He said that with all these bailouts, the Fed is essentially bypassing Congress's appropriations powers and just printing more money to bailout these companies, potentially in violation of the Constitution.

During the beginning of this construction boom and borrowed money from other countries this was mentioned as a way of escape- super duper inflation to pay off the loans. Jimmy Carter all over again.

During inflation you do not want any bonds. When the government starts to get rid of inflation that is a good time to buy bonds.

 

WA,

Your advice on bonds is not sound. Have you ever heard of TIPS? Foreign Bonds? Discounted commercial paper? But perhaps I am wrong - please expand upon your view of risk allocation and flight to safety......

Karl

 

WA,

Your advice on bonds is not sound. Have you ever heard of TIPS? Foreign Bonds? Discounted commercial paper? But perhaps I am wrong - please expand upon your view of risk allocation and flight to safety......

Karl

Your right. It is not bonds and inflation but, bonds and interest rates. Foreign Bonds are depent upon what is happening in their countries, which, many times has nothing to do with the US.

 

WA,

You have lost me. And there is a killing to be made in distressed paper now. KAMCO is setting up a fund of $1 billion USD to do just that.

Karl