It Doesn't Matter Who The Client Is.

Or how long you've known them. When you're levered up at over 30-to-1 in a credit crunch, even the name Carlyle loses its magic.

How'd We Get to $110 Oil?

This article from Cambridge Energy Research Associates is a good primer. They see a $150-per-barrel price as the breakpoint.

Bailing Out the Banks

If it's inevitable that a Federal bail-out of the nation's leading banking institutions is required to stave off catastrophe, shouldn't we just cut to the chase and get to it? Some very smart people say "yes." From today's Wall Street Journal:

At a lectern in a room of venture capitalists, Silicon Valley executives and professors at the Stanford Institute for Economic Policy Research last week, Larry Summers, former Treasury secretary and now Harvard professor and hedge-fund adviser, was at his gloomiest.

In the audience, Myron Scholes -- Nobel laureate in finance, veteran of the Long-Term Capital Management hedge-fund debacle and now chairman of his own hedge fund -- was listening and scribbling on a yellow legal pad. His conclusion, one gaining momentum, is that the government eventually will spend a lot of taxpayer money to clean up the current credit mess and prevent economic catastrophe.

"I think they should at least be thinking about it," he said. "If you're going to do it anyway, why not do it sooner?"

A Wall Street Journal survey of economic forecasters, to be released today, found that 32 of 51 economists (63%) said it is likely or certain that Washington will use public money to address the deepening housing crisis.

Wall Street would love what Treasury Secretary Henry Paulson derides as "a bailout," a way to unload its mistakes onto taxpayers. But unless the tide turns soon, the severity of the housing bust and fragility of the financial system may force even his hand.

An Alexander Graham Bell Moment.

That's what Marc Andreessen calls it. Hard to disagree. Click here for one astonishing video:
http://www.youtube.com/watch?v=xyN4ViZ21N0&eurl=http://technology.newscientist.com/article/dn13449-nervetapping-neckband-allows-telepathic-chat.html

Medicare

I remember reading somewhere the advice of Democratic political consultant Robert Shrum, who said that his party should stop trying to come up with health care initiatives (too complicated, he said) and just promise to extend Medicare coverage to an ever-larger percentage of the population. Enter that advice into the Bad Idea Hall of Fame.

Steve Jobs on What Makes Apple Work.

"We don't get a chance to do that many things, and every one should be really excellent. Because this is our life. Life is brief, and then you die, you know? So this is what we've chosen to do with our life. We could be sitting in a monastery somewhere in Japan. We could be out sailing. Some of the [executive team] could be playing golf. They could be running other companies. And we've all chosen to do this with our lives. So it better be damn good. It better be worth it. And we think it is."

The interview with Jobs in the current issue of Fortune is well worth reading.

Risk Management.

Can you buy fire insurance when your house catches fire? Michael Lewis has a good column on the Black Scholes theory of risk management.

Leon Wieseltier on Obama.


I suspect that there are many others who feel the same way about Senator Obama. But this essay sums up the doubts about the man as well as can be done inside of a tight word count.

Cerberus Letter

Inside this WSJ Deal Journal item is a link to a 9-page letter by Cerberus Managing Member Stephen Feinberg. It is worth reading in full, despite some whining about the press, which I'm sure is justified, but who cares. In particular, the first four or five pages give a very good overview of the havoc caused by the "credit crunch" and the further havoc that awaits.

The Titanic Hits Another Iceberg


Did they really think they were inevitable? Or was it just something they said, to keep the donors and the wobblers in line? There has always been, on the unhappy side of Sen. Hillary Clinton’s character, the hard edge of entitlement. This belongs to me. Somewhere along the line, this was internalized by Sen. Clinton’s remarkably insular inner circle. This belongs to us.

I suspect that they really truly believed that Sen. Clinton’s nomination was inevitable. It wasn’t a ploy or pose. Tonight’s Potomac primary must have been one disenchanting evening. Watching it all come asunder, as Sen. McCain skated along, not breaking a sweat. As Sen. Obama soared, smooth and graceful as a wide receiver running practice routes in pre-game.

Sen. Clinton’s staff, by embracing restoration and insisting upon her inevitability, has left her hanging out there with no rationale. They didn’t think it through. And now they have no idea what to say, other than witless attempts to “reframe” the media babble. Tonight’s offering from Team Clinton can basically be reduced as follows: the voters of Virginia and Maryland don’t matter. It only matters what the voters in Texas and Ohio and Pennsylvania think.

Do you think anyone noticed in Wisconsin? I guarantee you this: Sen. Obama won’t say that the voters in Wisconsin are meaningless. I bet he gives the cheeseheads his biggest smile and says: “I can hardly wait to see you.” They’ll be happy to see him too. Everyone loves a happy warrior.