Broken Record Stupid Dog Tricks
“Vern, that’s why you should trade me Park Place for the Water Works, oh yeah”- Ernest P Worell
In a rerun of last spring’s litany of takeover rumors comes one involving Bear Stearns and Warren Buffet. I guess the way this one works is Warren puts in a call, talks a little biz, and sources close to the scene float a rumor and then the stock (and market) ramps? The same game they played all spring.
While all this Buffet noise was going on, BSC sold some bonds, coincidence?
The struggling brokerage house raised at least $1 billion this afternoon with a surprise sale of 10-year bonds. The sale, which was met by strong demand in the bond market, comes just a day after Bear shares surged nearly 8% on rumors that the Wall Street firm was near a deal to bring in a big outside investor.
Alas, now there appears to be nothing to this Buffet talk, according to this New York Post article. Who buys these bonds, Ernest P Worell?
Meanwhile down in Miami it’s starting to look like the thousands of empty condos being built are being auctioned off for half price. Poof, goes the fictitious capital. I’m sure nobody in the financial sphere has exposure to this one, and even if they did: float a stupid dog trick rumor: Dubai, “the Chinese”, or Warren Buffet.
When it was all over, Pham walked away with a two bedroom unit on the 19th floor. To put the price in perspective, a one bedroom priced at $350,000 sold on average at auction for $176,000, almost half. A two bedroom unit that sold for about $600,000 last year, sold on average for $295,000.
As one might expect more corporate debt is showing up in the distressed category. Poof, goes the fictitious capital. This ought to be the tip of the proverbial iceberg. I’m sure nobody in the financial sphere has exposure to this either, and even if they did: float a stupid dog trick rumor: Dubai, “the Chinese” or Warren Buffet.
The percentage of distressed corporate bonds—those having option-adjusted spreads of more than 1,000 basis points relative to Treasuries—grew to 3.2 percent, up from 2.9 last month, S&P said. Before that, the level had been below 1 percent for five consecutive months.
The merger and acquisition arena has shut down fantasy leveraging, and old deals are failing citing fading business conditions (translate not enough income to support Ponzi units). Poof goes the fictitious capital. But that’s no problem: float a stupid dog trick rumor: Dubai, “the Chinese”, or Warren Buffet.
The volume of deals worldwide fell 42 per cent to $1,000bn during the third quarter, compared with the $1,740bn announced in the previous quarter, Dealogic, the financial data provider, said.
The commercial paper continues to disappear. Poof goes the fictitious capital. But that’s Ok, I’m sure nobody in the financial sphere has exposure here either, and even if they did: float a stupid dog trick rumor: Dubai, “the Chinese”, or Warren Buffet.
Foreign central banks buy a mere $2.3 billion in US Old Maid Cards this week. Oops where is Dubai, and “the Chinese”? FCBs already own $784 billion in housing mortgages of all things, apparently seeing them as suitable holdings as currency reserves? Maybe they believed the rating agency Kool-Aid and “implied government guarantees”? Guess that leaves Warren Buffet, all alone to support all that overpriced fictitious capital? Poof!
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