The Digest #102
Washington's Farewell, Commitment Bias, Default Habits, Derivatives, Amazon, Executive Compensation, Better Sleep ...
The Revolution That Wasn’t
Spence Jakab's book tells the story of Robinhood, GameStop, AMC, and other meme stocks that became a mania, driven by a profit motive and a desire to punish short-sellers ...
Goldman’s Problems Continue with Threat of FCIC Derivatives Audit
Despite paying the largest penalty ever assessed against a financial firm by the Securities and Exchange Commission, Goldman Sachs is still an attractive target for government panels investigating the financial crisis. Goldman agreed to pay a $550 million settlement on ...
Berkshire Lobbies Congress on Derivatives Collateral Requirements
In a warning that was largely ignored at the time but proven correct in subsequent years, Warren Buffett referred to derivatives as "financial weapons of mass destruction" in his 2002 letter to Berkshire Hathaway shareholders. Critics of Berkshire's recent involvement ...
Derivatives: Implications for Investors
Carol Loomis has written a "must read" article on derivatives which appears in the July 6 issue of Fortune Magazine as well as online at Fortune.com. At a time when regulation of derivatives is a major focus in Washington, it ...
Highlights from Berkshire’s 2009 Annual Meeting
I made the trip to Omaha this weekend for the 2009 Berkshire Hathaway Annual Meeting. This was my first trip to Omaha since 2005 and attendance at the meeting has grown considerably over the past few years. I still remember ...
Moody’s Downgrades Berkshire Hathaway
So much for the conspiracy theories! Moody's, which is 20% owned by Berkshire Hathaway, today downgraded the long term issuer rating of Berkshire two notches fromAaa to Aa2, and the Issuer Financial Strength (IFS) rating of most of the insurance ...
Ban Naked Credit Default Swaps?
There has been much debate in recent days regarding whether the market for Credit Default Swaps (CDS) should be more tightly regulated. Let's take a look at the nature of credit default swaps and whether arguments for tighter regulation have ...
AIG’s Bonus Debacle
Anyone reading this who is a taxpayer in the United States is, in effect, a shareholder of AIG due to the Federal Government's infusion of $173.3 billion in bailouts over the past six months. These bailout funds have resulted in ...
Berkshire’s Misunderstood Derivatives
With all of the inaccurate information being reported about Berkshire's derivatives exposure, Warren Buffett apparently saw the need to devote several pages of his annual letter to shareholders to explain the situation in great detail. Unfortunately, it appears that most ...