One Car Too Few.
The Porsche business model is the subject of this excellent NYT piece. Worth reading in full.
Saturday, April 04, 2009
One Car Too Few.
Posted by John at 4/04/2009 06:34:00 AM
The New York Times would have been well-advised to shutter The Boston Globe and The International Herald Tribune last fall. Both are losing vast amount of money (the Globe loses $7 million a month), and there's not even the remotest chance of a turnaround.
For whatever reason, Arthur Sulzberger has been unable to make these two decisions. If he wants to save The New York Times Company and its flagship newspaper, then prepackaged bankruptcies for the Globe and the IHT are necessary first steps. It's as simple as that.
Posted by John at 4/04/2009 06:00:00 AM
Thursday, April 02, 2009
Wednesday, April 01, 2009
Tuesday, March 31, 2009
Jay Cutler is Unable to Come to the Phone.
Posted by John at 3/31/2009 10:12:00 PM
Monday, March 30, 2009
The AIG Scam (continued).
AIG, knowing it would need to ask for much more capital from the Treasury imminently,
decided to throw in the towel, and gifted major bank counter-parties with trades which were egregiously profitable to the banks, and even more egregiously money losing to the U.S. taxpayers, who had to dump more and more cash into AIG, without having the U.S. Treasury Secretary Tim Geithner disclose the real extent of this, for lack of a better word, fraudulent scam.
In simple terms think of it as an auto dealer, which knows that U.S. taxpayers will provide for an infinite amount of money to fund its ongoing sales of horrendous vehicles (think Pontiac Azteks): the company decides to sell all the cars currently in contract, to lessors at far below the amortized market value, thereby generating huge profits for these lessors, as these turn around and sell the cars at a major profit, funded exclusively by U.S. taxpayers (readers should feel free to provide more gripping allegories).
What this all means is that the statements by major banks, i.e. JPM, Citi, and BofA, regarding abnormal profitability in January and February were true, however these profits were a) one-time in nature due to wholesale unwinds of AIG portfolios, b) entirely at the expense of AIG, and thus taxpayers, c) executed with Tim Geithner's (and thus the administration's) full knowledge and intent, d) were basically a transfer of money from taxpayers to banks (in yet another form) using AIG as an intermediary.
For banks to proclaim their profitability in January and February is about as close to criminal hypocrisy as is possible. And again, the taxpayers fund this "one time profit", which causes a market rally, thus allowing the banks to promptly turn around and start selling more expensive equity (soon coming to a prospectus near you), also funded by taxpayers' money flows into the market. If the administration is truly aware of all these events (and if Zero Hedge knows about it, it is safe to say Tim Geithner also got the memo), then the potential fallout would be staggering once this information makes the light of day.
Posted by John at 3/30/2009 06:57:00 AM