I agree with what Matthew said. It is time for the entire globe to learn a lesson from our US mortgage market default crisis. Lenders here in US have been recklessly approving and lending money to borrowers who are not capable of paying it back. Just like what we learned last week in class, there are many regulators in the current market, from FED, FIDC to Security Exchange Agents. As a matter of fact, all the regulators seem to perform their obligations well. The issue is that at the bottom of the regulation chart, mortgage brokers are taking advantage of the system and lending money to consumers with bad credit. People on top of the chart might not even know what is going on inside the lending department until mortgage fraud starts to taking over the market.
I think the new way of 3 major regulators should work better. The new 3 major regulators eliminate all the unnecessary departments and people who are not involved. Fewer steps mean more accuracy and more efficiency. More importantly, when there is a problem, the signs are taken early and seriously. It is time to tighten our regulation.
Sunday, April 6, 2008
Mitts!
You can do research, study the market, plan carefully and still lose a fortune. This is a scary fact that many investors face when gambling in the stock market. There is now a financial instrument called “MITTS”, tailored by Merrill Lynch that allows a respectable return with zero chance of loss.
“MITTS” hedges the risk of options based investments with Zero Coupon Bonds to create an investment portfolio that is both secure and potentially highly profitable. An example of a “MITTS” investment would be as follows; 80% of your money could be invested in Zero Coupon Bonds and 20% could be invested in options. Under this type of scenario, an investment can be created that will return the full value of your investment through the Bonds portion of the investment. You can gamble with your options and make a fortune, or at the very least, break even if the options become worthless. The reason why is because the Zero Coupon Bonds are bought at a discount to “Par” value. If they are for sale at a price of $16 today and at some point they will mature and be worth $20, this part of the investment is a guaranteed return. If the options become worthless at the due date, you would still have your investment back.
In conclusion, MITTS trades like an ordinary stock on the NYSE and can be purchased through any broker. This type of investment is an excellent tool that can be used to eliminate the risk of loss while still seeing a nice return on one’s investment.
http://fintrend.com/ftf/Stock_Market/Mitts.asp
“MITTS” hedges the risk of options based investments with Zero Coupon Bonds to create an investment portfolio that is both secure and potentially highly profitable. An example of a “MITTS” investment would be as follows; 80% of your money could be invested in Zero Coupon Bonds and 20% could be invested in options. Under this type of scenario, an investment can be created that will return the full value of your investment through the Bonds portion of the investment. You can gamble with your options and make a fortune, or at the very least, break even if the options become worthless. The reason why is because the Zero Coupon Bonds are bought at a discount to “Par” value. If they are for sale at a price of $16 today and at some point they will mature and be worth $20, this part of the investment is a guaranteed return. If the options become worthless at the due date, you would still have your investment back.
In conclusion, MITTS trades like an ordinary stock on the NYSE and can be purchased through any broker. This type of investment is an excellent tool that can be used to eliminate the risk of loss while still seeing a nice return on one’s investment.
http://fintrend.com/ftf/Stock_Market/Mitts.asp
MicroSoft Bid for Yahoo!!
Microsoft Corp has given Yahoo Inc. a three week deadline to accept a $31-a-share offer or it will take their bid directly to the shareholders. The Microsoft bid to buy Yahoo is valued at more than $40 billion and would mark the largest takeover in the high-tech industry.
Yahoo inc. had declined Microsoft's original offer, saying the bid undervalued it’s true worth. Microsoft argues the economy and the market for Internet stocks have declined and that Yahoo's share of Web search and advertising business has also declined and referred to industry market reports. In addition, a Yahoo investor said the deal with Microsoft involved regulatory risks that would reduce a merger's potential value.
The board of directors at Yahoo has adopted a strategy that would make a merger with Microsoft more costly. For example, Yahoo has provided a severance plan to all employees if the company was sold that is commonly known as a “golden parachute.”
In conclusion, the acquisition of Yahoo Inc. by Microsoft Corp is heightened by tensions of market risk and perceived value by both parties involved. The time sensitive acquisition proposal by Microsoft Corp for Yahoo Inc. is underlined by the declining value of the market for internet stocks. In addition, adopted strategies by the Yahoo board of directors have made the proposed acquisition a costly objective to achieve.
http://www.msnbc.msn.com/id/23958838/
http://www.bloomberg.com/apps/news?pid=20601103&sid=adbTBkawpo9I
Yahoo inc. had declined Microsoft's original offer, saying the bid undervalued it’s true worth. Microsoft argues the economy and the market for Internet stocks have declined and that Yahoo's share of Web search and advertising business has also declined and referred to industry market reports. In addition, a Yahoo investor said the deal with Microsoft involved regulatory risks that would reduce a merger's potential value.
The board of directors at Yahoo has adopted a strategy that would make a merger with Microsoft more costly. For example, Yahoo has provided a severance plan to all employees if the company was sold that is commonly known as a “golden parachute.”
In conclusion, the acquisition of Yahoo Inc. by Microsoft Corp is heightened by tensions of market risk and perceived value by both parties involved. The time sensitive acquisition proposal by Microsoft Corp for Yahoo Inc. is underlined by the declining value of the market for internet stocks. In addition, adopted strategies by the Yahoo board of directors have made the proposed acquisition a costly objective to achieve.
http://www.msnbc.msn.com/id/23958838/
http://www.bloomberg.com/apps/news?pid=20601103&sid=adbTBkawpo9I
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