Archive for March 2009

How to Invest in General Motors

gm-muralInterestingly enough, there might be still some room to invest in General Motors. Well, you might say that this is an insane investment after all, but after all the bondholders of GM might have a point after all.

And yes, we at reffer to a potential investment in GM’s bonds. Read more

Bank of America Executives – “A Bunch of Idiots”

In a recent ABC interview, Virginia Hamerness, one of the descendants of the Bank of America founders, named the executives of BOA “a bunch of idiots”. Why

Well, let’s start with the fact that they agreed to buy Merrill Lynch last fall, even after learning that the outgoing CEO paid lavish bonuses to the same executives who oversaw Merrill’s downward spiral. In her opinion, this was more than stupid – it was playing around with shareholders’ money (she among themselves). When they were given those bonuses,” Hammerness says, “I think Bank of America should have said, ‘Go drown. Go drown yourselves.’ I’m sure he and my father are turning over in their graves. I’m sure they are.” Read more

AIG Pays, Then It Is Taxed, Then They Give the Money Back

aig-towerSometimes I can’t stop wondering. First of all, AIG decided to pay bonuses to its executives for about $160 million. Of course, the cash came from the roughly $90 billion government help to the worldwide linked insurer to survive until toady, in a move which was very much debated. Since AIG showed that its fall would trigger a domino collapse of the global financial system, it looks now like the government had little choice about it. And so it did.

Now the show turns sour for the bonuses recipients. Forced by the public opinion outrage (justified or not) and by the 90% taxation bill enforced by the Senate, most of the AIG executives decided to return those money to the company. In its famous book, “The Truth About Markets”, John Kay mentions in one chapter this irrationality of the capital markets – we do not blame a company that it fails under the assumption that all company fail (market crash), but its executives are rarely forgiven by the public. Yet, those people are not invincible. And the executives of AIG might argue that they worked hard for those money, which are not out of the usual payments. Read more

6 Ways to Survive in a Market Crash

currencies-3Mr. Keynes, one of the most respected economists of al times, the one who’s doctrines are still running many countries, has once remarked: “Blessed be our nephews, becasue they shall inherit the national debt”. In the same manner, they shall inherit the outcome of our investment strategies and fortunes, so why not start now in a positive manner? Read more

Forbes Rich List 2009 Unveils Big Changes

billionnaires-mapOne of the most awaited lists in the world of money, the one maintained by Forbes, has been published. And of course, is hitting all the media channels.
If you look at the list, many positions have been changed. And this is mostly due to the recent worldwide shakedown of the economies, who have torn appart many industries. The financial crisis was hitting hard most of the bilionnaired, especially those with large investments in the financial industry or in the raw materials sector.
Some of the billionnaires risked too much. So were most of the Indian and Russian oligharchs, who saw their fortunes vanishing once with the oil price going down more than 3 times in one year. Read more

Has Boeing Lost Its Lackluster?

boeing airplaneGone are the days when the only question that Boeing was asking itself was: “Should we make big planes or small ones?” And that bet has not proved yet to be a success, but nor a failure. Read more

What Does The Latest Stock Market Crash Mean

After the Dow Jones fell to the smallest level since 1997, the investors can find that buying shares of some global icon companies can be cheaper that buying the products of those companies.
One obvious example is the banks sector. As we previously mentioned here on, Citibank has been basically nationalized by the government which now owns the majority of the ownership. Their share price has crashed to $1 per share, from a maximum of $27 in the last year. Read more