Brokers, financial advisors, and wealth managers are a recalcitrant bunch, suddenly, after having gotten their manicured fingers burned on a few super-hyped IPOs, and now they just refuse to get exuberant about the Twitter IPO. At least that’s what they indicated in a survey. But individual investors, well, that’s another story.
Wall Street shenanigans
Texas Instruments CFO Admits: Stock Market Is Overpriced
by Wolf Richter • • Comments Off on Texas Instruments CFO Admits: Stock Market Is Overpriced
Stocks balloon, we’re incessantly told, because revenues are rising due to great products, ingenious strategies, or brilliant marketing; and because earnings are rising due to, well, if not rising revenues, then cost cutting, moving production overseas, squeezing suppliers…. But what if revenues sag and earnings plunge, not for a bad-hair quarter, but for years, and the stock still balloons?
Another Heap Of Wall-Street Hype and BS
by Wolf Richter • • Comments Off on Another Heap Of Wall-Street Hype and BS
Earnings estimates for Q3 have been crashing for a year. On October 1, 2012, our brilliant Wall Street analysts estimated that they’d leap 15.9%. As of Friday, these brilliant analysts have chopped their forecasts for the same brilliant quarter down to a measly growth of 2.1%. Stagnation! Now they’re hyping how companies are beating these crummy forecasts!
David Stockman: Blackstone Double Dip
by Wolf Richter • • Comments Off on David Stockman: Blackstone Double Dip
The Wall Street machinery was back in business thanks to the Fed’s policies, David Stockman writes. When Extended Stay America exited bankruptcy, its new owner was, well, Blackstone – which had done the LBO. To underscore that speculators had returned to the scene of the strangulation, as it were, its partner in the deal was John Paulson’s hedge fund.
Stockholders Got Plundered In IBM’s Hocus-Pocus Machine
by Wolf Richter • • Comments Off on Stockholders Got Plundered In IBM’s Hocus-Pocus Machine
I’m not picking on IBM. I’m almost sure they have some decent products. So they had a crummy quarter – the sixth quarter in a row of sales declines. And their hardware sales in China have collapsed since Snowden’s revelations about the NSA and its collaboration with American tech companies. But in one area, IBM excels: its hocus-pocus machine.
Alcatel-Lucent “Could disappear,” Says CEO Michel Combes
by Wolf Richter • • Comments Off on Alcatel-Lucent “Could disappear,” Says CEO Michel Combes
“The company could disappear,” said Alcatel-Lucent CEO Michel Combes, not exactly the kind of wondrous hype CEOs normally sputter to bamboozle people into plowing their money into the company’s stock. The end, after two decades of ingenious Wall-Street engineering, fee extraction, fanciful accounting, executive wisdom, and brilliant strategic thinking.
Why The Wall Street Casino Lives On
by David Stockman • • Comments Off on Why The Wall Street Casino Lives On
David Stockman lashes out at the LBO of Extended Stay, a scam that made Blackstone billions, and saddled taxpayers with the detritus. It’s perhaps the most brilliant explanation ever as to why the Fed bailouts of Wall Street were an asinine idea that benefited the “0.0001%” but hurt everyone else, including taxpayers and the main-street economy.
Earnings Season Starts With A Bang, So To Speak
by Wolf Richter • • Comments Off on Earnings Season Starts With A Bang, So To Speak
They’re getting hilarious, the shenanigans on Wall Street. Revenues have been lousy all year, and despite feverish cost cutting, earnings are sliding. The third quarter has been over for almost two weeks, but Q3 earnings estimates are still being pushed down. A lot! So that companies can “exceed expectations.” They’re now at stagnation levels. And stocks soar.
“Yellen Props Up Stocks” And Other Scary Data Points
by Wolf Richter • • Comments Off on “Yellen Props Up Stocks” And Other Scary Data Points
Alarm bells went off: “Yellen props stocks,” the headline read. Somebody needs to. Politicians are actively contemplating how to most effectively send the largest and brokest debtor in history into default. Corporate revenues can’t keep up with inflation. Earnings estimates and actual earnings growth plunge. And the S&P 500 soared 16% year to date.
David Stockman: Extended Stay And The Wall Street Meth Labs
by David Stockman • • Comments Off on David Stockman: Extended Stay And The Wall Street Meth Labs
Wachovia and other banks funded the $7.4 billion debt portion of the Extended Stay LBO, knowing the company was worth only $4.8 billion at the most. The loan was then rolled into structured finance securities – “designed to turn a sow’s ear into a silk purse,” David Stockman writes – and stuffed into the Wall Street meth labs until the very end.