Archive for February, 2009

  • Yes We Can!
    , February 17th, 2009 at 4:29 pm

  • Obama Signs
    , February 17th, 2009 at 3:38 pm

    Congratulations bill, you’re a law.

    President Obama on Tuesday signed the $787 billion American Recovery and Reinvestment Act into law.
    But he’s far from being able to declare “mission accomplished.”
    “Today does not mark the end of our economic troubles,” Obama said before signing the bill at the Denver Museum of Nature and Science. “But it does mark the beginning of the end — the beginning of what we need to do to create jobs for Americans scrambling in the wake of layoffs; to provide relief for families worried they won’t be able to pay next month’s bills; and to set our economy on a firmer foundation.”

  • Fourth-Quarter Earnings
    , February 17th, 2009 at 2:15 pm

    According to the latest numbers I have from S&P, fourth-quarter S&P 500 earnings reports are 85% in. The number for operating earnings looks to be $5.77 which is down from $15.22 from the fourth quarter of 2007. The “as reported” earnings negative.
    I doubt operating earnings will crack $50 for all of 2009. Here’s a look at the S&P 500 and operating earnings for the past few years.
    image769.png
    The black line is the S&P 500 and it follows the left scale. The gold line is operating earnings and it follows the right scale. The two lines are scaled at a ratio of 16 to 1 so when the lines cross, the P/E Ratio is exactly 16.
    What’s interesting is that the earnings multiple hasn’t changed much over the past few years. You can also see how much of 90s rally was due to multiple expansion.

  • SEC Charges Stanford Financial in $8B Fraud
    , February 17th, 2009 at 1:44 pm

    Finally:

    The Securities and Exchange Commission today charged a prominent Texas businessman and three of his companies with an $8 billion fraud in the sale of certificates of deposit. The case appears to mark one of the largest alleged frauds by a money manager in U.S. history.
    Robert Allen Stanford and his companies sold $8 billion of CDs — guaranteed fixed-income investment products — to investors by “promising improbable and unsubstantiated high interest rates,” the SEC said in a statement. The agency named in its complaint Stanford International Bank Ltd., based in Antigua, and related firms based in Houston.
    The SEC said the firms falsely claimed that their deposits were safe, that more than 20 analysts monitor the investments, and that yearly audits were being conducted.
    In addition, one of Stanford’s companies falsely told customers that it was not exposed to the $50 billion Ponzi scheme allegedly orchestrated by Bernard L. Madoff, the SEC said.

  • Shoichi Nakagawa at the G7
    , February 17th, 2009 at 1:39 pm

    If you haven’t seen it, here’s Shoichi Nakagawa sounding a bit drunk at the G7 meeting.

    He’s resigned.

  • Medtronic’s Earnings
    , February 17th, 2009 at 12:57 pm

    Unlike most of the market, Medtronic (MDT) is having a good day today. The stock is up on decent earnings.

    For the quarter ended Jan. 23, Medtronic reported net income of $723 million, or 65 cents a share, up from $77 million, or 7 cents, a year earlier. Excluding acquisition-related charges, earnings rose to 71 cents a share from 63 cents.
    Net sales rose 2.6% to $3.49 billion, or 6% excluding foreign-currency changes.
    Analysts surveyed by Thomson Reuters were expecting earnings, excluding items, of 70 cents on revenue of $3.51 billion.

    This is good to see. Last quarter’s performance was not comforting. Here’s a look at MDT’s sales and earnings for the past few quarters:
    Quarter………..EPS………….Sales
    Jul-01…………$0.28………..$1,455.70
    Oct-01………..$0.29………..$1,571.00
    Jan-02………..$0.30………..$1,592.00
    Apr-02………..$0.34………..$1,792.00
    Jul-02…………$0.32………..$1,713.90
    Oct-02………..$0.34………..$1,891.00
    Jan-03………..$0.35………..$1,912.50
    Apr-03………..$0.40………..$2,148.00
    Jul-03…………$0.37………..$2,064.20
    Oct-03………..$0.39………..$2,163.80
    Jan-04………..$0.40………..$2,193.80
    Apr-04………..$0.48………..$2,665.40
    Jul-04…………$0.43………..$2,346.10
    Oct-04………..$0.44………..$2,399.80
    Jan-05………..$0.46………..$2,530.70
    Apr-05………..$0.53………..$2,778.00
    Jul-05…………$0.50………..$2,690.40
    Oct-05………..$0.54………..$2,765.40
    Jan-06………..$0.55………..$2,769.50
    Apr-06………..$0.62………..$3,066.70
    Jul-06…………$0.55………..$2,897.00
    Oct-06………..$0.59………..$3,075.00
    Jan-07………..$0.61………..$3,048.00
    Apr-07………..$0.66………..$3,280.00
    Jul-07…………$0.62………..$3.127.00
    Oct-07………..$0.58………..$3,124.00
    Jan-08………..$0.63………..$3,405.00
    Apr-08………..$0.78………..$3,860.00
    Jul-08…………$0.72………..$3,706.00
    Oct-08………..$0.67………..$3,570.00
    Jan-09………..$0.71………..$3,494.00

  • Michael Moore Needs Help
    , February 13th, 2009 at 11:06 am

    From MichaelMoore.com:

    Friends,
    I am in the middle of shooting my next movie and I am looking for a few brave people who work on Wall Street or in the financial industry to come forward and share with me what they know. Based on those who have already contacted me, I believe there are a number of you who know “the real deal” about the abuses that have been happening. You have information that the American people need to hear. I am humbly asking you for a moment of courage, to be a hero and help me expose the biggest swindle in American history.
    All correspondence with me will be kept confidential. Your identity will be protected and you will decide to what extent you wish to participate in telling the greatest crime story ever told.
    The important thing here is for you to step up as an American and do your duty of shedding some light on this financial collapse. A few good people have already come forward, which leads me to believe there are many more of you out there who know what’s going on. Here’s your chance to let your fellow citizens in on the truth.
    If you have any info that would help, please contact me at my private email address: bailout@michaelmoore.com.

    First, I hate to tell Michael this but the story has already been exposed. Secondly, is bailout@michaelmoore.com really your private e-mail?

  • The Stimulus Bill Reaches 1,434 Pages
    , February 13th, 2009 at 10:09 am

    Here’s the complete text of the economic stimulus bill. All 1,434 pages.

  • Happy 200th Birthday Lincoln and Darwin
    , February 12th, 2009 at 6:47 am

    I just finished watching an interesting BBC series, The Voyage of Charles Darwin. I had no idea how important Darwin’s journey on the Beagle was to his work. He was at sea for five years.

  • James Wolcott Admits Defeat in an Argument
    , February 11th, 2009 at 11:13 pm

    In other words, he calls Arnold Kling a racist:

    A few days ago notice was taken (I’m practicing my passive voice) of economist Arnold Kling’s contention that the Obama stimulus plan was actually “reparations” in disguise. Given the complexion of our new president, this was interpreted as injecting a needless bit of race-baiting into the economic debate, raising the specter of a million Jeremiah Wrights marching on the capital mall with outstretched hands, demanding their cut of the action.

    One of the great advantages of seeing the race card played is that it tells me which side realizes it’s losing the argument.
    Thanks, James. You saved folks a lot of time.