Professor Elam
Accounting & Investing Info for San Antonio A & M
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Category: Financial Acct
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Ambac is a company that used to insure various mortgages and other financial instruments. This promise proved to be as illusory as the FDIC insurance for bank deposits, both groups are now bust. The Ambac CFO has resigned as the stock sinks below one dollar. The idea of financial 'insurance' is dying a hard death,…
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Americans routinely belief that their bank deposits are 'safe' as in insured by our friends at the FDIC. Not so fast. Like any other insurer, the FDIC operates with premiums from member banks, They are now out of premiums given the number of bankrutpcies of banks. whoops….
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Two outsiders are winning converts to audit the FED, their bill passed the committee despite opposition from the FED itself and Barney Frank, no surprises there. The US has had three central Banks. Andrew Jackson helped kill the first one. Congress did not renew the Charter for the second. This one the FED was created…
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A tip of the mortarboard to Prof Sam Rock for spotting this excellent article about accounting history. I mentioned the difficulties of a local museum in the last post, perhaps they did not have the courage to look at the books. This article details this is nothing new. Please read this article, quite interesting.
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Read The Naked Swindle in the Rolling Stone. Someone bought $1.7 M worth of puts on Bear Stearns when the stock was $63, with strike prices 50% lower and only nine days left for expiration. And they paid off 159x. Gee do you think that person had inside information? And the SEC cannot find out…
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WE are discussing derivatives in Intermediate II Accounting. Please read this article on Commercial Real Estate and Commercial Mortgage Backed Securities. CMBS is a derivative. It gets value from the mortgages that it owns. If the mortgages become delinquent, the value of the CMBS will plummet. And the assets, so called, of the banks holding…
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The Crash of 1929 and the resulting bank collapses brought the Investment Company Acts of 1933 and 1934. Investment companies were in such disrepute they had to be renamed and so they became mutual funds. Now Chris Dodd wants to change banking regulation in light of the bank meltdowns. Of course the Senate had passed…
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Warren Buffet already owned 20% of Burlington Northern, why did he buy the rest? One reason for this blog is to go behind the headlines and link what we study in the classroom with the real world. I posed this question to the Intermed II class last night, indeed, why? The answer is that he…
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A MOVE TO CHANGE SARBANES-OXLEY By Neal Boortz @ November 4, 2009 8:22 AM Permalink | Comments (8) | TrackBacks (0) Hold on to your hats. I'm about to give The Community Organizer credit for something. The Obama administration is apparently pushing Democrats in the House to reform the hideous act of 2002 known as Sarbanes-Oxley. Chief of Staff Rahm Emanuel…
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Stanley which owns Stanley hand tools and MAC automotive tools is acquiring Black and Decker, a power tool maker. Note this is an acquisition by stock not cash. While there is talk that this will eliminate overhead, the BD workers better hope their union is in good shape, and the BD management will not be…
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