Tag Archives: stocks

Lessons from Today’s Market

I have been watching the markets for a while.  Having left financials a long time ago and not advocated them, I saw this company for a while.  Having lived through the dotcom bubble, I knew the signs and this has trouble written all over it 3 years ago. 

 

Today the market fell 500 points with big names going down.  A lot of these problems, not all, could have been avoided if we had not deregulated the financial services industry.  I’m not a big fan of big government but sometimes those regulations do help and I think if they had been in place, they would have helped to at least lessen the damages that we saw today.

 

Paulsen doesn’t seem to be concerned with fixing the problem just maintaining things until who ever comes in next.  Hopefully we will learn our lesson from this that sometimes, tempered growth is not all that bad.  Sure, we saw a lot of wealth made after dereg but a lot has vanished as a result.

 

Wall Street has acted like a kid in a candy store and I do remember when this was happening to other industries they said “let them go down, let the market determine who survives.”  So I am not all that happy with bailouts, after all, what is good for the goose is good for the gander.  If Wall Street firms made bad choices let them fail, after all, they should know how to manage money better than they have shown.  They certainly have shown that they are not deserving of the high salaries and perks they heap upon themselves.  So let them fail.  The real engine of America, the small and medium size companies, will go on and continue to produce jobs and that is who we should be helping.  The people who actually create jobs.

 

I think main street is where the real action is for growth in this country and if anyone needs a bail out or stimulus deal, it is main street.  Hopefully someone in Washington will figure that out and start helping the real economic powerhouse of America.  Wall Street, let it purge, it needs it more than a bailout.

 

 

 

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AIG Sinks Again

Can you hear the splashing of water?  That’s AIG trying to stay afloat, reaching a new low of $4 a share.  Wow! 

 

So AIG is seeking some relief, the feds are in and even Cramer was saying we should help AIG because of the insurance policies.  Yeah, save the policies, not the company.  The government should look at bailing out the policy holders, not AIG.  After all, AIG is the one who screwed up, not the policy holders!  So why help AIG who has proven it doesn’t know money.

 

Look, before AIG gets help, it can help itself by doing a few simple cost cutting measures. 

 

  1. Eliminate all perks, no corporate housing, no cars, cut back on everything and anything.  You’d be amazed what you can save when you do that.

 

  1. Cut salaries by 50%, I know, drastic, but not like you got a lot of options right now. 

 

  1. Sell off assets.  Lets face is, someone will buy up prime divisions, why not make some money and give investors an out, after all that’s your charter.

 

These simple measures would save the company in the short term, long enough to help what is left to move up again.  But I am sure as usual, they will want a bailout, the feds are involved so you that’s on the table.  I say no to a bailout.  Investors get hosed and management gets away with murder!  Management needs to be the first ones to feel the hurt, that is in the interest of investors, put a flame under their ass and get them to work for their money.  Pay for performance should be implemented.  You want that six figure salary, put up the numbers!  That will trim the fat real fast. 

 

AIG should go the way of Lehman’s and then let the feds step in and save the policies.  Management at all levels has not done their job and should not be saved.

 

BTW, thanks everyone for visiting, a new one day high was reached today.

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