Merril Lynch and Good Money After Bad

Poor babies! Merril Lynch suffers a $10 billion dollar 4th quarter loss due to to the crash in the subprime mortage market (ML wrote down 14.6 billion dollars in investments). For years they were riding high on the profits of the real estate market bouyed by ever increasing Ponzi schemes and now the time has come to pay the piper. I can't feel sorry for these folk who painted themselves into their own corner. They must have known that things could not keep on going as they were forever. At some point there had to be a correction of sorts in the real estate market. And they must have known who would have been left holding the bag when all those over priced homes financed by increasingly gimmicky and risky mortgages started heading south.

Now,I am just some regular smuck who lives in a modest neighborhood. Over the last few years my eyes have just been bulging at the jump in prices of our humble shacks. I live in what many consider a starter neighborhood where typical prices are 1/2 million plus. Believe me, these houses on postage stamp lots are hardly worth it. But up to a couple of years ago people were lined up to buy them, outbidding each other while the finance and investment industries were right there to fan the flames of the situation. Even I, unsophisticated little ole me, knew that what goes up must come down.

I guess when you are flying high, making all those great commissions, denial of reality can become the norm. Everyone is doing it, right? Well, Merril Lynch looked great in those heady days, but now reality has come home to roost. The party is over and, oh, what a headache! It is not like everyone knows that drinking too much of the devil's brew has payback the day after. Hey, anybody got a hair-of-the-dog package of subprime loans they can spare?

Anyway, Merril Lynch just received an infusion of cash from foreign investors to help keep the ship from sinking ($12.8 billion since December). Since these guys at ML are such wizards at losing money, you just have to wonder what kind of snake oil they are selling now to convince these foreign investors that they are not just throwing their hard earned cash to the winds. I am sure that there were some good commissions made on that deal. Good money after bad? We'll see.

Hillary's Rabbit Out of Hat

Well now, Hillary wins in New Hampshire. You go girl! I say that not so much as a Hillary supporter (I still prefer Edwards), but more from the glee that gushes out of me because the pundits pretty much had it all wrong. Hey you pundit guys, don't be so anxious to be writing candidates off before the people (you know, the voters) have had their chance at the polls. Just maybe the media air bags don't influence us as much as they like to think they do. I hope not anyway.

I was disappointed with Edward's distant third place. But hey, it's not over till the Fat Lady sings, and I don't see her in the wings yet. One can hope that South Carolina will treat one of their own well. I sure like the things that Edwards has had to say, especially concerning the disparities in our contemporary society.

Obama, well , he did great. Good solid numbers. He has the gift of oratory, puts on a good show, and certainly can stir the congregation. But if the contest comes down to be between Clinton vs. Obama - I will jump on the Clinton bandwagon. She is smart, savvy and tough. AND she knows the lay of the land - which is to say I think she could do the job better due to her experience versus Obama who has little more to offer in that category than wishful thinking. Then again, if experience was the only consideration then Biden should have been the choice. President Biden? I don't think so.