June 2008

Lehman Brothers (LEH) as expected reported a $2.8 bn loss yesterday. Goldman Sachs (GS) reported profit results today weaker than a year ago, and Morgan Stanley (MS) is due tomorrow, with Bank of America (BAC), Citigroup (C), JPMorgan Chase (JPM) and Merrill Lynch (MER) due out in July. Writedowns are the order of the day on Wall Street. Never before in the history of the stock market have ... read more

Federal investigators have stepped up their probes into the subprime crisis. The investigations go beyond the possible pending indictments stemming from the collapse of two hedge funds at Bear Stearns (BSC) last summer, a collapse that cost investors $1.6 bn and kicked off the subprime meltdown. The federal investigations now underway also go beyond the investigations into the Swiss bank UBS ... read more

We are witnessing a fresh round of stiff-necked fulminations over the need for a new windfall tax on oil profits from elected officials who appear to understand little about the economic impact their legislation has on US taxpayers. A growing number of Congressmen want to enact a windfall profits tax to punish what they say are greedy gougers in the oil industry. Though the Senate just rejected ... read more

Ignore the bullish kitchen sink writedown talk, that future earnings per share results on Wall Street will look better when compared to EPS figures coming out now, as they have been socked hard by colossal writedowns. That's because shareholder dilution in the form of new stock issuance at Wall Street firms could keep earnings per share results down in future quarters. To plug the holes in ... read more

Meredith Whitney, top analyst at Oppenheimer, said she and her squad met with Ken Lewis, chief executive of Bank of America (BAC). Whitney says Lewis "reiterated his belief" in the "economics of the Countrywide acquisition." Specifically, Whitney says Lewis "noted that the deterioration in the economy does not allow" Bank of America "to renegotiate" the $4 bn deal for Countrywide (CFC). She ... read more