Back from Nashville

Our first trip to Nashville was moderately eventful. We woke up Saturday morning to the Nashville Marathon and wound up at the Grand Ole Opry that night. Oh yeah, I finally made it to the stage at the Ryman . . . .

A new leader in the banking crisis

UBS AG, Switzerland's biggest bank signaled that it will cut its investment bank to a rump after lost bets in subprime mortgages landed the Swiss group with a $37 billion bill, making it the biggest casualty of the financial crisis.

The world's biggest banks and securities firms have announced $290 billion in asset writedowns and credit losses since the beginning of 2007, including reserves set aside for bad loans

now ring the bell . . . . who's next?

Lightning Strikes

Want to see some interesting data on lightning strikes ?? click here

William C Moore - 80 years of surfing

Bill Moore, the icon of Malibu passed away in December, 2007. He was surfing regularly at 88 but then a combination of ailments took their toll. I was privileged to be invited to join the surfout at Malibu Surfrider Beach organized by the Malibu Surfing Association on Saturday to honor Bill.

60% of Americans are renters and they're not happy with government bailouts

see what's going on here

NDFI . . . . ??? what's that?

NDFI is a acronym for "non deposit taking financial institution" and then there's this . . . .

Investment bank, hedge fund and broker balance sheets are about half the size of the commercial banks in the US and about one-quarter the size in Europe. Both assets and liabilities of NDFIs are dominated by repos, meaning that NDFIs lend and borrow based upon collateral of assets that are constantly marked to market. As asset prices fluctuate, leverage must constantly be adjusted.

Doug Kass on "bullishness"

Which gets me back to the media and a recommendation that I respectfully suggest to every host on CNBC, Bloomberg and Fox Business Network -- when interviewing a member of the bullish cabal, ask the following questions:

1. What is your investment mandate?

2. Do you have the flexibility to raise or reduce the cash component of your portfolio?

3. What was your cash position two years ago, what was your cash position a year ago and what is your cash position today? And why were your cash positions at those levels?

4. Have you ever been bearish?

5. How have the deteriorating economic conditions and worsening profit picture affected your market and economic views?

6. What change in conditions from current expectations would lead to a further change in your market views?

I might add, in bull markets, the obligation of the media is to ask the bears the same questions.

quality forecasting by GE

4/11/08 after announcing quarterly earnings declines, Chief Executive Officer Jeffery Immelt cut the annual forecast he had once told investors was ``in the bag'' for 2008 and repeated as recently as March 13 . . . so much for relying on the predictions of the geniuses . . . again.

another Warren Buffet quote

"you only learn who has been swimming naked when the tide goes out -- and what we are witnessing at some of our largest financial institutions is an ugly sight."

I love forescasters

from Bloomberg this afternoon on Freddie Mac (25.46) and Fannie Mae (29.00)

Lehman Brothers Holdings Inc.'s estimated that the stocks will soar to $45 or more, while their colleagues at Goldman Sachs Group Inc. forecast that the shares will tumble to $16 or less.

I'm not kidding or making this up . . . . you just can't make up this stuff.

Why not live in your house for free

Borrowers in California who fight foreclosure can stretch the process to 18 months, said the chapter president of the California Association of Mortgage Brokers and president of Cal-Pro Mortgage Inc. in Stockton.

That doesn't take into account the woman he knows who hasn't made a mortgage payment in eight months and hasn't heard from her lender.

``Now she's afraid to mail in a payment for fear it'll come to somebody's attention,'' he said.

Postdictive error

Using data after the fact to review decisions before the fact is a very critical mistake . . . . so when someone says that "we could have survived if . . . . " they are usually making this mistake. Today, this came out :

April 3 (Bloomberg) -- Bear Stearns Chief Executive Officer Alan Schwartz said the fifth-largest U.S. securities firm might have survived if the Federal Reserve had acted earlier to lend money directly to investment banks.

Since we can never know, it's totally ridiculous that a major media outlet would even give this type of thinking credibility by printing it. This is like me saying, I might not have been hurt walking down the street if the ball hadn't rolled in front of me . . . duh.