Ultimate Bottom Lies Far Below Because we never shared investors’ wild enthusiasm for Cerberus, its near-collapse in recent days hardly came as a shock. The once-huge private-equity firm specialized in distressed assets at a time when even the bluest of blue-chip companies - the name Lehman Brothers springs to mind - have fallen into mortal peril literally overnight. Cerberus’s biggest gambles were in GMAC and Chrysler. The latter company’s future looked as bleak to us five years ago as it did in May, when the automaker went belly-up. What could... Read the Rest of the Article | Comments *** Treasury Default Not So Unthinkable Although we can be certain Americans and their government owe far more than they will ever be able to repay, the question of how this debt eventually will be discharged is the economic conundrum of the day. Some think hyperinflation is the only way out, since it would allowing debtors to repay all that they owe with worthless bank notes that would be in copious supply. However, this is hardly a solution, since those on the receiving end - i.e. the lenders — would be ruined, as would the bond markets, banks and all other... Read the Rest of the Article | Comments *** Bank Scare a Ruse to Shake the Tree A run on a major U.S. bank? Who could have been spreading such scurrilous rumors? They surfaced yesterday in the Rick’s Picks chat room, and elsewhere, not long after we’d done some personal banking ourselves in an online account at the very same bank. We experienced no delays or problems with the transaction, notwithstanding reports of a “default situation” and “elevated” buying of put options on the shares of the bank. We were able to confirm that there had indeed been a flurry of
LATEST TRADES
