Wednesday, April 15, 2009

Some financial stock stuff (stock)

It makes me sick that even after going below $50 not that long ago, Goldman Sachs manages to raise money by selling shares at $123/share. Not only that, but supposedly it was oversubscribed. Who are these people buying at this price? Even at its all-time highs the stock never went higher than $250, and now with the added dilution of three offerings in the last year, someone thinks it's a good investment at this price?

Speaking of Goldman Sachs, CNBC was reporting that one analyst (I think it was Dick Bove) said that Goldman should pay back Buffett rather than the TARP, because Buffett's stake is more expensive. Of course they're not going to do that, seeing as how Buffett's a valued customer and paying off the TARP allows them to regain control of their executive compensation. I hate the financial world.

Among other financial instruments came the fun fact that FAS and FAZ crossed paths at $9.50 last week, and right now are priced to cross paths at $9.18ish. I've mentioned before how ridiculous these instruments are:
If I remember correctly, both FAS and FAZ came out priced at $70 each less than a year ago. As my friend likes to point out, SKF is now lower than it was when it came out in the first quarter of 2007. It's bad enough that these are poorly designed instruments, but I heard from someone at work that his friends had brokers try to push SKF on them as a downside hedge. It's ridiculous either way whether these brokers are just complete idiots or are purposely pushing to sell something that is faulty. I hate the financial world. I can't wait for the class action lawsuits.

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