Does Paulson’s TARP = TRAP?
For the second day in a row, Federal Reserve Chairman Ben Bernanke and US Treasury Secretary Paulson pleaded to the power players of Washington to pass their request for $700 Billion to implement their Troubled Asset Relief Program (TARP). However if we move the letters around a bit, TARP becomes TRAP and that is [...]
Capitalism DOA?
Markets have soared late this week on the news that Superman (aka Henry Paulson) will once again fly into the heat of battle and snatch victory from the jaws of sure defeat. According to Paulson, the federal government is busily crafting a taxpayer funded scheme to absorb all of the bad mortgage debt and make [...]
Resolution Trust Corp: What is it and Will it Help the Markets?
Over the past few days, the markets have shrugged off the government’s bailout of AIG and a flush of liquidity from central banks around the world. No matter what the Federal Reserve or the US Treasury tried to do, they failed to please the markets. However in the last few hours of trading [...]
Recent Mergers and Acquisitions Status Report
$ Greenfield Online, Inc (SRVY) - Microsoft Corp (MSFT)
September 12, 2008 (10:40a) - Tender Offer Statement Filed
MSFT filed the initial tender offer statement and offer to purchase for this transaction with the SEC on September 11, 2008.
The current tender offer expiration date is Wednesday, October 8, 2008.
The regulatory matters section of the statement notes the [...]
A Sobering Dose of Reality
In the 1980’s, the Ford Motor Company used the slogan “Quality is Job #1”. This was helpful in their campaign to compete with their Japanese counterparts who were perceived to have higher quality automobiles. It would seem, based on recent trends in the employment market that government is now Job #1. This morning’s employment situation [...]
Non-farm Payrolls Falls -84K, Unemployment Rate Hits 5 Year High, Revisions Are Ugly!
There is no question that the US labor market is deteriorating. Non-farm payrolls fell by -84k last month, driving the unemployment rate to a 5 yeer high of 6.1 percent. However what made FX traders really sell the dollar was the jump in the unemployment rate and the revisions. The US government [...]
Merits and Faults of Buybacks
It’s hard to read the WSJ these days without hearing something about buybacks. Exxon absorbing $102 billion, Citigroup spending $8.3 billion and even Coach buying back $1 billion. Stock buybacks or share repurchases are known to have powerful effects in building shareholder wealth. To many, it’s often an overlooked measure of the health of a [...]
VIX Futures Signaling End of Year Slump?
In a perfect world the value of standardized futures on deliverable assets is determined via arbitrage argument, or FP = SP*(1+RF)^t.
But a unique opportunity arises in the pricing of futures that can not be arbitraged. In this scenario there is only one force setting the price: unbiased expectation of the future price of the asset. [...]
Is this the Third Shortest Bear Market?
Since the market “bottomed” on July 15th, we have seen a tremendous rally in all major sectors outside of materials and energy. But is this the end of a bear market or just a big short squeeze?
To answer this question we can look at historical bear market duration and price declines, and a technical picture [...]
