Complex bond schemes haunt Indy, other cities
The city is just beginning to digest the news that came out of left field regarding Indianapolis Water Co.’s bond transaction gone wild.
Ken Skarbeck
Articles
Skarbeck: Shareholders must hold fiduciaries’ feet to the fire
The economic downturn has provided shareholders an opportunity to press for change
on a variety of corporate governance issues.
Banking system’s history should help ease fears
Since people must have confidence in the financial system for it to function properly, it is incumbent upon our leaders to
take action and assure the people their money is safe.
Look beyond emotions when investing
As Ben Graham said in his Mr. Market allegory: “The market is there to serve you, not guide you.”
With bear market raging, are stocks priced right?
Looking past all the bad news, a forward-thinking investor should be asking: Just how cheap are U.S. stocks?
Corporate shareholders should demand more
Free marketers cringe at the thought of government interference, but the fact is that the taxpayer is now a significant shareholder in a number of financial businesses.
Time to close book on ’08, and not a moment too soon
For investors across the globe, most
would agree that 2008 was an annus horribilis. Anyone with a vague recall of Latin will arrive at the translation of "horrible year."
Weird yields for Treasuries evidence of investor angst
A large number of investors are so fearful these days that they have flocked to the safest securities, pushing down interest
rates to virtually nothing.
Analyzing intrinsic value unearths some bargain stocks
investors looking at business valuations likely will conclude there are companies selling at
prices less than their intrinsic values.
Fed’s TARP changes adding to anxieties
Experts with the Troubled Asset Relief Program, the government’s financial bailout program, are struggling to figure out how
best to relieve America’s financial mess.
Market plunge makes investments in good firms a bargain
The stock market rout that began in September and picked up steam in October has taken some quality companies to prices that
are the cheapest they have been in decades.
INVESTING: Investors’ margin calls accelerated selling spree
After a tumultuous and historic couple of weeks, culminating Oct. 10-when stocks dropped 800 points as the market opened-investors stood on the edge of the abyss and stopped selling. Market participants arrived at the conclusion that, over that coming weekend, financial chiefs around the world would do whatever it took to rescue the financial system. And they did, by formulating measures to be undertaken by finance leaders across the globe that are unprecedented and wideranging, from supporting the commercial paper…
INVESTING: Advocates did bad job selling rescue package
The word bailout is being used more than the folks at Merriam-Webster ever could have imagined. Yet, bailout is the wrong term to characterize the rescue plan the Federal Reserve and the Treasury presented to Congress. Our leaders have done a poor job explaining why. At present, the U.S. financial system is in cardiac arrest, and this plan is the defibrillator designed to jolt the system back to life. The crux of the problem is that banks and other financial…
INVESTING: Excessive use of leverage now walloping Wall Street
Here’s a well-worn saying about businesses that engage in risky behavior: “You only find out who has been swimming naked when the tide goes out.” If so, we are nearing low tide and the biggest nude beach on the planet is on display in lower Manhattan. These recent events are historic. Lehman Brothers, a 158-year-old firm that survived the Depression and world wars, was forced into bankruptcy due to leveraged bets on subprime securities and risky loans made over the…
INVESTING: Tough stock market brings big names back to Earth
Oh, how some of the mighty have fallen. A number of high-profile professional investors are struggling in this bear market. Perhaps surprisingly, many of these managers come from the “value investing” category, a style of investing that is supposed to outperform-or at least lose less – markets. In their heydays, when their mutual funds produced investment returns that soundly beat the market averages, these managers were often accorded star status in the financial press. Here are a few of the…
INVESTING: Beware of advice as you seek wisdom on Internet
Most people abide by the doctrine that you cannot believe everything you read. That principle is all the more relevant today for anyone accessing the massive reservoir of information available over the Internet. The latest Web trend is the “blog,” where anyone with an opinion and modest technological know-how can instantly appear to be an authority on a chosen subject. Investors need to be particularly alert to “articles” that on the surface may pass as knowledgeable, yet upon closer inspection…
INVESTING: Candid e-mails chip away at Wall Street’s credibility
E-mail, today’s ubiquitous form of communication, is proving to be the smoking gun in a number of recent financial fiascos. The Securities and Exchange Commission recently released a draft of its investigation into the behavior of bond-rating firms during the subprime-mortgage-securitization craze. The report highlighted e-mails expressing the sentiment of the authors during the period-a sentiment in conflict with the Wall Street sales pitch being used to sell these securities to investors. One e-mail a Standard & Poor’s analyst sent…
INVESTING: High pay for failed CEOs adds insult to injury
Labor Department figures show that average annual family incomes in the United States, adjusted for inflation, have grown just 0.8 percent since the end of 2001. On the other hand, executive pay and severance pay for fired CEOs has skyrocketed. At the very least, the average family shareholder deserves a thank you. Surely if you are a shareholder of AIG, you expect a kind word from ex-CEO Martin Sullivan who left in June with a $47 million severance package-despite AIG’s…
INVESTING: Conditions are brutal, but opportunity awaits
The depths of the problems plaguing financial firms were on full display July 7, the date Fannie Mae’s shares dropped 16 percent and Freddie Mac’s tumbled 18 percent. Last December in this column, I marveled at how well the stock market had absorbed a 25-percent nose dive in the stocks of these two mortgage titans during trading Nov. 20. Since their highs last fall, these two institutions that underpin the mortgage and housing market have lost 75 percent of their…
INVESTING: Why Anheuser-Busch bid resonates in Indianapolis
One of our sister Midwestern cities is locked in a fight for its corporate identity. A n h e u s e r- B u s c h , maker and distributor of Budweiser brand beers-and the corporate icon of St. Louis-is engaged in a $46.3 billion takeover battle for its survival as a U.S.-based company. The would-be acquirer is Belgium-based InBev, the second-largest brewer by volume in the world. London-based SABMiller, who in 2002 bought Miller Brewing in Milwaukee,…