I have been slammed with several projects lately. They have taken significant time away from my usual routine. I haven’t been able to keep up with my Google Reader, much less the market over the past week. I will keep this one short and sweet. Anyone over the age of 30 should appreciate the article title. Time Bandits is a classic. Sometimes I wish I had a map with time portals so I could get “stinking rich”.
All day today a song kept running through my mind as I watched the markets. It started this morning when I heard the talking heads on CNBC going crazy over the fact JPMorgan Chase would now pay $10 instead of $2 for Bear Stearns. The artist is LL Cool J and the song is Mama Said Knock You Out. Aren’t we all such a bunch of suckers? Let’s face facts. We are small time investors without the inside knowledge only granted to that wealthy connected Wall Street crowd. Towards the end of last week you had people arguing as to why the price of Bear Stearns had reached $6 when they were being purchased for $2. The consensus was that major stockholders were buying up shares to make sure the deal went through. What was the real story?
Well maybe not a one dollar bill, but a two dollar bill will get you a share of Bear Stearns today. The financial networks were all buzzing this morning about the anticipated one point rate cut tomorrow and the bailout of Bear Stearns by JPMorgan Chase and the feds. Now this is just a guess, but I would imagine that if you asked most of the 14,000 employees what they thought of the “bailout” you would get a one-finger salute.
There is not much to say, I think the headline spells it out for you. The Thoroughbred Folio reached a new record this week. We are at our lowest point since we began this journey back in December. The mortgage crisis and weak dollar are to blame. At least, that’s what the news media keeps telling me. It’s funny I can remember the Internet hoopla around 2000. The real estate bubble was just the same. People start believing things can go on that way forever, but they rarely ever do. If something looks to good, then there is definitely something wrong under the hood.
Warren Buffet was a guest on Squawk Box this morning. You know things are bad when the Oracle graces CNBC at 6AM for two hours. Buffet seemed pretty dire about the whole situation with the markets in the U.S. He had one parable that summed up the overall American situation.
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