Yesterday I got a pretty good short swim in. The highlight was that hot board shorts was there- later than I was so did not overlap much but he is now wearing a speedo! Whoo-hoo.
We had dinner with DR and PF last night at a restaurant owned and run by some guy who won some cooking reality show. The food was great and the wine was too but PF definitely needs to work on his indoor voice. Funny how an Italian guy like him has an Irish whisper...
So today my mom and dad marked 47 years of wedded bliss. I called them before the open to wish them a happy anniversary. Dad said he was taking mom out for a hot dog and cold beer to celebrate.
You would think that with all the shit going on that President Obama's new dog would not be a top story. Apparently it is though because he said if they got one it would be a rescue dog- a lovable mutt that needed a home. Instead he got a pure-bred Portuguese Water Dog. So now some people are crying foul. Give me a break and leave the guy alone- it is so not important right now. More important things we should be thinking about are things like North Korea quitting the nuclear talks, kicking out the UN inspectors and starting up their reactor again.
I have to say for all the build up of a major speech from the President today I did not hear anything really new. I do agree with him that education is and should be a top priority and is a massive investment in our future. I think that comes from being an Irish Catholic boy at heart who's father saw to all of his family's needs by being a teacher in the public school system and ending his career as a superintend ant.
Ok so GNW got the Heisman for becoming an S&L which means they are shut out of all the government programs to help the credit markets. It raises the spectre of counter-party risk yet again.
What exactly is a surgical bankruptcy? I have no idea how the government thinks they can bring about a controlled and "surgical" bankruptcy for GM? More importantly it will be viewed by the UAW as a massive betrayal by the President regardless of the why it was needed. It will be quite an interesting spectacle to watch but it will cause some serious further damage to the economy and consumer confidence.
So the smartest guys in the room are selling. It should bring to mind the old adage that if you are at a poker game and trying to figure out who the sucker is it means it is you. GS is frackin' brilliant in their strategery (I love that Bushism). They float the idea of paying the TARP back early. They then pre-announce positively and do a REALLY fast deal to sell $5 billion of common equity. They keep announcing it is their intention to pay back TARP. There are a few sticking points I keep getting caught up on though.
GS took $10 billion. The government has said firms that took TARP can only pay it back with money done by a capital raise. i.e. a sale of common equity or preferreds. I only saw GS raise half the amount they took. Yes they have ~$7 billion in cash on hand but I don't think that is allowed. More importantly the government really can't allow GS to pay it back right now because then it proves that people who took it and can't really did need it or they would have failed. It would quickly separate the wheat from the chafe. That would not be good now. The government will have to interfere even more in the markets. But not to worry- GS has a plan.
In their earnings most of their CREs are marked at 50. No big deal, like the conservative take. The problem is in the PPIP example put out by the government. In the example, the CREs are sold at 84. The heavily subsidized private capital buyers aren't putting up all of it so they could make money. However- if they don't sell at 84 then no bank will take the hit and GS is way ahead of the crowd no less severe mark downs would be needed. If they do sell there then GS gets to now mark their CREs back up to 84 showing huge percentage profits. It will also make any private capital buyer who was thinking about paying a heavily subsidized 84 if GS (widely viewed as the smartest guys out there) are saying they are only worth 50.
I got out of the office kind of late tonight. Had to run down town to pick up a picture of me and my oldest from spring break to give him. There was no bus around to take me back up town. I started walking and then had to take a leak in really bad way. I stopped at one of my old haunts thinking I could just use the john there. They now have a sign saying bathroom is for customers only. No problem. I walked in, ordered a Miller Lite and took my leak. Walked back to the bar, paid for my drink and then had the beer. It was so worth it.
Have a long swim tomorrow morning. If I am lucky hot board shorts will be in the lane next to me in his new speedo...
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