MAD MONEY

MAD MONEY

PostBy: spc On: Mon Mar 17, 2008 9:50 am

This weekend J.P. Morgan rescued Bear Stearns & pay $2 a share in a stock-swap transaction.
Last Tuesday, Jim Cramer on his TV show Mad Money said people were “being silly” by thinking about dumping their Bear Stearns stock at $65.

http://www.liveleak.com/view?i=2b7_1205751955
Talk about eating crow.:oops2: :doh: :oops:

Any experts on this forum with advice on where to put our money? What little we may have. :)
Last edited by spc on Mon Mar 17, 2008 10:11 am, edited 2 times in total.
spc
 
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Re: MAD MONEY

PostBy: stockingfull On: Mon Mar 17, 2008 10:01 am

Jim thinks he's gonna be Treasury Sec'y, on Spitzer's say so.
http://groups.google.com/group/misc.invest.stocks/browse_thread/thread/587c241dc08d1b9b

:lol:
stockingfull
 
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Re: MAD MONEY

PostBy: Dallas On: Mon Mar 17, 2008 10:12 am

spc wrote:Any experts on this forum with advice on where to put our money? :)



Harley Davidson ... guys will buy a Harley, regardless of what's happening in the world or their lives. With gas out of control, a Harley at $20K, will be cost effective.
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Re: MAD MONEY

PostBy: stockingfull On: Mon Mar 17, 2008 10:18 am

Kudlow said tech and oil this morning.
stockingfull
 
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Re: MAD MONEY

PostBy: spc On: Mon Mar 17, 2008 10:20 am

With baby boomer retiring I thought any stock involved with RV's would be a buy, but fuel prices crushed that idea.
spc
 
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Re: MAD MONEY

PostBy: stockingfull On: Mon Mar 17, 2008 10:34 am

spc wrote:With baby boomer retiring I thought any stock involved with RV's would be a buy, but fuel prices crushed that idea.


I got a 29' class C sitting on my property, probably worth more to part out than anything else. Gets 7 MPG, what's that now, 50 cents a mile? :cry:
stockingfull
 
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Re: MAD MONEY

PostBy: upstate On: Mon Mar 17, 2008 10:58 pm

The Bear Sterns colapse is similar to the Enron collapse. Their problems were hidden and were only known by a select few. They reassured their employees and the public that there wasn't any problems until the colapse. They are now being investigated as to their extent of deception to share holders and employees.Imagine if you retirement stocks went from $65 to $2 in one week.
upstate
 

Re: MAD MONEY

PostBy: ken On: Tue Mar 18, 2008 1:45 am

some billionaire in the UK lost 800 mil on that crap. probaly won't even miss it. :D
ken
 
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Re: MAD MONEY

PostBy: Charlie Z On: Tue Mar 18, 2008 6:44 am

Gubment just wanted it done. Gave them 1 day to wrap it up. The Fed has never, and was never designed to cover investment banks. That lifts eyebrows. A lot of tip toeing going on...

Bear's buildings are worth about $1B and their prime brokerage unit is worth around $900M. Write down their holdings to 10% of their portfolio (radical) and you still have $3B. All to JPM for $236M... It happened quick, though. They could have simply reduced 100-200 employees to save that amount, but it takes some time.

Looks like JPMChase got the bargain of the century. Can't go wrong, the downside, losing $236M, is a rounding error, they'll take that bet, anyday.
Charlie Z
 
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Re: MAD MONEY

PostBy: CoalBin On: Tue Mar 18, 2008 11:00 am

From the fed.gov

What are the Federal Reserve's responsibilities?
Today, the Federal Reserve's responsibilities fall into four general areas:

1---conducting the nation's monetary policy by influencing money and credit conditions in the economy in pursuit of full employment and stable prices
2---supervising and regulating banking institutions to ensure the safety and soundness of the nation's banking and financial system and to protect the credit rights of consumers
3---maintaining the stability of the financial system and containing systemic risk that may arise in financial markets
4---providing certain financial services to the U.S. government, to the public, to financial institutions, and to foreign official institutions, including playing a major role in operating the nation's payments systems

#3 is what they were trying to accomplish here - basically there was a run on the 5th largest investment bank.

"Mr. Bernanke had made clear for months that he wanted to avoid a bailout of Wall Street. But as an economic scholar who spent years studying the Depression of the 1930s, he had also drawn the lesson that panics in financial markets can transform a modest downturn into a cataclysm.

Fed policy makers now contend that the consequences of not coming to the rescue would have been a cascade of bankruptcies and defaults on Wall Street that could have undermined the financial system and risked severe damage to the economy."

desperate times = desperate measures

for an interesting read - http://dealbook.blogs.nytimes.com/2008/ ... t-for-now/ don't know if you have to register - but basically says the collapse was precipitated by rumors they were going under - so everyone stopped making deals with them & was pulling money out - not only would this bankrupt bear stearns - but also throw the market into a death spiral - :shock: :? The $2 / share figure is not a done deal - I believe the share holders still vote
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Re: MAD MONEY

PostBy: Yanche On: Tue Mar 18, 2008 11:32 am

I highly recommend Alan Greenspan's recent book, "The Age of Turbulence". It describes what the Fed did after 9/11 to avert financial panic. It's also an excellent book on economic history as seen from the eyes of a man that was a big part of it for decades. Ending chapters talk about "The Long Term Energy Squeeze" and "The Delphic Future". Read those chapters and you will be buying and storing all the coal you can afford!
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Re: MAD MONEY

PostBy: CoalBin On: Tue Mar 18, 2008 11:41 am

Yanche wrote: Read those chapters and you will be buying and storing all the coal you can afford!


Amen !

With the double whammy of our downward spiralling dollar and ever rising fuel costs - I just built another coal bin - its time to stock up and save.
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Re: MAD MONEY

PostBy: livefreeordie On: Tue Mar 18, 2008 2:39 pm

spc wrote:Any experts on this forum with advice on where to put our money? What little we may have. :)

CoalBin wrote:
Yanche wrote: Read those chapters and you will be buying and storing all the coal you can afford!


Amen !

With the double whammy of our downward spiralling dollar and ever rising fuel costs - I just built another coal bin - its time to stock up and save.



I'm no expert, but that might be your answer right there .... buy coal.
How long before the value of coal starts to approach that of its clear, shiny cousin .. the diamond? :D

One thing I do remember being discussed a few years ago but don't hear too much about now ... oil not only supplies us with fuel, but think of everything else that's related to the petrochemical industry ... Nearly everything in our lives is made from oil, made by machinery and systems dependent on oil, and transported by oil as either gas or diesel fuel. Just think of plastic alone. Everything from water bottles to the shell of your computer to some of your clothing.

I would imagine any environmentally based stock, alternate energy stock, something similar will be the way to go. It's probable that the big money maker of 30 -40 years time isn't even available yet. Who even understood what the automobile would become in 1899, or the personal computer in 1979?
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Re: MAD MONEY

PostBy: spc On: Tue Mar 18, 2008 3:44 pm

If these oil producing countries see environmentally based & alternate energy products taking hold they will start ramping up production which I think (?) will lower oil prices. In turn these alternate products & research for them will fall by the wayside. Is this scenario possible? I know coal is a big part of our energy production already but oil is still king. I guess if we are just talking about coal related stock its a buy.
spc
 
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Re: MAD MONEY

PostBy: stockingfull On: Tue Mar 18, 2008 3:48 pm

spc wrote:If these oil producing countries see environmentally based & alternate energy products taking hold they will start ramping up production which I think (?) will lower oil prices. In turn these alternate products & research for them will fall by the wayside. Is this scenario possible?


Historically, that's what's happened. But this time I think people -- including governments -- will look much more closely when/if that happens.
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