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Gold/Mining/Energy : Big Dog's Boom Boom Room
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To: pz who wrote (109953)9/20/2008 9:49:17 PM
From: profile_143 Recommendations  Read Replies (2) of 206209
 
Note that the government has already increased its $24 billion equity in AIG by some 60% and that AIG is paying it Libor +8.5%, so that spread between Libor and the government's true funding cost plus the 8.5% on $85 billion ought to return nearly $9 billion a year and the equity has already appreciated $14.4 billion. Not a bad week in my book. FNM and FRE are in a similar situation, where down the road the government might make some good dough. We have just become a sovereign fund and no one seems to be talking about that fact, just about the nasty shorts who have caused all this grief, never mind others' excesses. My view is that if all these companies were so undeservedly punished by shorting then value investors just had/have the best opportunity to buy distressed assets at a huge discount. If not and the prohibition of shorting is unfair, then folks can buy in the money puts for a sure fire trend to zero. Now if they can only cut spending instead of raising taxes... JMVHO.
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