Tuesday, March 31, 2009


In addition to my previous post on GM's restructuring process, read this partial list of issues and stakeholders that need to be addressed in GM's and Chrysler's plans to be submitted to the government tomorrow. Keep these in mind as you read and listen to the inevitable commentary and debate.

Here are some of the stakeholders whose claims and interests must be altered:

The US Government's previous loans
Senior bank lenders
Mortgage lenders who hold mortgages on various plants and locations

Unsecured bondholders
Landlords who hold leases on various plants and locations
Suppliers and vendors

Joint venture and alliance partners
Local, county and state entities relying on revenue for their bond obligations as well as taxes
Current employees
Job bank employees

Retired employees
Various businesses and individuals that support the automakers and employees with non-auto goods and services.

Here is a partial list of the issues:

The likely real annual auto demand
Too many brands
Too many dealers
Too many plants
Too many non-plant facilities
Too many employees, management, union and other

How much more loans are required? Their terms and conditions?
Treatment of the senior bank lenders claims vis a vis the government loans?
The unsecured bondholders debt for equity swaps? What about those that don't agree?

Treatment of undersecured mortgage lenders?
Treatment of leases underlying facilities that need to be abandoned?
State franchise laws which require substantial payments to closed dealers?

Various contracts with suppliers, vendors and joint venture/alliance partners
Portion of retiree benefits to be shifted to the PBGC

This is just a partial list. I just want us to understand there are numerous stakeholders and issues that have to be addressed. Keep these in mind as you listen to the proposals.

Are they all addressed? What are the other issues? Who are the other stakeholders?

More to come.

Cheers, Mike

Monday, March 30, 2009


To restructure the company, GM must first develop a realistic operating plan that is cash flow positive. This is the essential first step in any corporate restructuring. After this plan is vetted and agreed upon by various stakeholders, these cash flows dictate the level of debt that the company can support. This operating plan also gives rise to the valuation of the company.

Once the cash flows, debt capacity and valuation are determined, then, and only then, can the company determine the size of the pie that must be divided up amongst the stakeholders. I have written this before. But GM has not followed this process, so it is no surprise that it hasn't been able to complete an out-of-court restructuring.

Stay tuned as more info comes to the forefront.

Cheers, Mike

TASK FORCE SAYS GM, NEW CEO - Second in a Series

The Task Force recommended that new leadership is required for GM. After you read their brief report, it is obvious that new management is required. Now a few comments.

A number of people are saying the government is going too far when it requires a new CEO. I am not for government intervention in business beyond a certain point. But I view this very differently. The government is the lender of last resort. The lender of last resort, not the government, demanded a change in management. Lenders of last resort, usually banks, have been demanding CEO changes as a condition of further lending for over 25 years. It is a good and necessary business practice. And in this case, it was the right thing to do. Clearly Wagoner's plan fell short and he has had enough years.

Incumbent management is often incapable of seeing the radical changes that must be made. So, I am not so sure promoting the COO to CEO is the right thing. The way the process works is that the lenders tell the company, usually the board in a public company, that the CEO is not longer acceptable to the lenders. The lenders usually give the board three names of crisis managers to interview and make the retention of one of those individuals a condition that needs to be met before more financing is made available. Sometimes, the lenders will provide enough financing to allow the crisis manager time to develop a restructuring plan.

I see the government acting as a lender. Requiring a new CEO was the right move. It should now require a crisis manager who is able to develop and implement an operational restructuring plan and a financial restructuring plan.

Cheers, Mike


I like what the Task Force did as summarized by this WSJ article. The Task Force wrote its five page viability report like the reports I used write. It is short, sweet and to the point. The Task Force concluded that the GM's plan is not viable, but with a substantial restructuring it could be viable.

The Task Force states that under GM's own plan showed that it would not generate positive cash flow. Further, the Task Force sets forth that GM's plan did not adequately address the legacy liabilities which continue to grow over the plan period.

It was also concluded that the market share, pricing and product acceptance assumptions were too aggressive and not realistic. Reading between the lines, the Task Force reached the same conclusion I would have reached; new leadership is required.

Read the five page viability report. At least read the first page.

Cheers, Mike


The call for more regulation and rules has already started and is part of the Treasury Secretary's plan to overhaul the financial markets. This occurs after every crisis, when there is much political grandstanding.

Does everyone remember the post- Enron scandal legislation? Sarbanes-Oxley or SOX was introduced as the most sweeping changes since the great depression. Sound familiar? Did it stop or even lessen this crisis?

SOX was introduced to address the following problems:
- auditor conflicts of interest
- boardroom failures
- security analysts conflicts of interest
- SEC inadequate funding
- banking practices- making loans that were too risky
- executive compensation excesses

Well, how well do you think it worked?

It did drive a great revenue stream for the accounting and consulting firms as they helped companies comply with the regulations. So one benefit of new regulation could be job creation in these industries. Now, there were benefits from the SOX legislation. The question is the follow through.

It seems we should make sure there is follow through and action taken from the current rules on the books before we jump to adding more legislation and good forbid more government agencies. There is a good article in the WSJ regarding the Risk Management group at AIG. Two things really caught my eye.

In January 2008, PWC, the auditors of AIG, reported to the board that access into the financial products unit by the risk group may require strengthening. Two months later the Federal Office of Thrift Supervision reported the the financial products unit was allowed to limit access of the key risk control groups.

Why bother to have risk groups if they can be denied access and if their reports are not acted upon by the board? Why are the oversight groups, in this case PWC and the Feds, allowed to write reports with vague wording such as "may require strengthening"?

But most importantly, nothing was done! If we have rules and regulation, they need follow through and "teeth". If not, let's not waste the time on legislation.

Questions for all of you:
1) Do you know your company's risk management policies and procedures?
2) Do you know if the policies and procedures are targeted to your company's biggest risks? Mike and I use a technique in our leadership development sessions in which we ask people to list the three biggest risks in their company or group and what they are doing to monitor, mitigate, and manage those risks.
3) How do you know if the controls are being circumvented, such as denying access?
4) What is the process? This is one of Mike's favorite sayings...work the process.

Until next time,

Sunday, March 29, 2009


The Obama Administration appears to understand that when you are providing the financing for the restructuring of a financially-troubled company, you get to make certain demands. Apparently, one of the requirements will be the resignation of GM CEO Rick Wagoner according to press reports.

The rule of thumb in the workout of financially troubled companies is that the CEO, and usually the CFO, must be replaced sometime during the restructuring. A number of years ago I looked at approximately 200 cases we had worked on and in 85% of the matters both the CEO and the CFO were replaced. Wagoner has been the CEO since 2000. I am afraid it is time for him to go.

But, who replaces him? Should it be someone from inside GM? Should it be an auto industry executive? Should it be a crisis manager? What say you?

Cheers, Mike

Friday, March 27, 2009


As a follow up to Mike's post yesterday entitled Leadership and Business Schools, I wanted to add comments on the partnerships that need to be formed between business and business schools.

The article written by the Villanova Dean was excellent. I agree with his comments that B schools need to be innovative, agile and creative. He also commented that the faculty is the heart and soul of every business school.

I have been fortunate to be in classrooms with Yale, Harvard, Columbia, Tulane and Villanova business school professors. They are a group of true professionals. Their research and depth of thinking on the issues coupled with their professionalism as educators is outstanding. They can really engage the minds of anyone in the class room.

However, most of them have never run a business. They have never had to make many of the decisions they teach others to make. When Mike and I have worked with them, I see the synergy occur every time. We bring the practical business experience, which is very powerful when matched up with the professors' skills.

While most all business schools offer executive education to corporations, there are very few true partnerships. This is where I believe the unique power exists for the future.

True partnerships between business and business schools would not only offer the mix of academic and practical skills but would also allow the businesses to better reinforce the lessons in ongoing reinforcing corporate training, but would provide fertile ground for significant innovation, creativity and agility.

Leadership is the differentiator between the best and worst performing businesses. All the technical skills in the world can not compensate for poor leadership skills.

I believe that the universities and businesses that create true partnerships will create something unique and powerful.Better leaders!


Finally Congress and the NY State Attorney are looking at the remaining 99% of the $170 billion given to AIG by the government. There attention is increasingly focused on who AIG paid with the funds, especially the credit default swap counterparties. So, it appears it is time for a primer on credit default swaps (CDS). Just to set the context, at 12/31/08 there were approximately $55 trillion CDS outstanding. That is roughly 4 times the value of the stocks on the NYSE. So, now we know it is a very large amount.

I was going to attempt an English language version of CDS 101, but I found this article from Newsweek that does a better job than I could ever do. It is a very easy non-technical read. If you want to spend 10-15 minutes to understand CDS from a more technical standpoint, check out this from Wikipedia.

Please read the Newsweek article if you want to follow the AIG CDS bouncing ball over the next few weeks.

Cheers, Mike

Thursday, March 26, 2009


Jim Danko, the Dean of the Villanova School of Business, wrote an opinion piece on the role of business schools in the education of business leaders and the current global financial crisis. It was printed by Forbes. Dean Danko lays out what business schools in general should be addressing at a strategic level. He sets forth what VSB is doing in particular.

He writes that in the undergraduate programs, first year business students must take a year long course on how business works and how business contributes to society. This is done so that students have a context to learn functional skills.

I like that he readily admits that the Villanova approach is not the only approach nor is it the only school attempting to address the situation. He does call on more institutions to look at the teaching content and methodology to be responsive to the 21st century demands.

What schools really need to teach is leadership! Granted it is not easy to define leadership let alone teach it, but it must be done. In our leadership workshops, Gail and I are emphasising doing the right thing over short-term financial gain as a core leadership value and emphasising that leaders are intuitive and have the courage to follow their intuition.

It is necessary for our schools, businesses and organizations to treat all employees, students and participants as leaders and in turn require them to think, speak and act as leaders. Requiring people to act as they think a leader should act raises the productivity level of all.

Are you thinking, speaking and acting as a leader all the time?

Cheers, Mike

(In the interest of full disclosure, I serve on Dean Danko's Advisory Board.)


Mark my words, this wave of chapter 11 filings that we are currently riding will be marked by all the companies being sold or liquidated. It will not be marked by reorganizations like the last wave of bankruptcies from 2000-2003.

Dial-A-Mattress, according to this NY Times blog, is being sold to Sleepy's. In order to effect the sale, Sleepy's is providing the DIP financing. I expect this scenario to play itself over and over in 2009. The lack of DIP financing from third parties and unpredictable short-term revenues are forcing more and more companies to liquidate or to be sold in whole or in parts instead of reorganizing.

The traditional process of restructuring the operations and then the balance sheet, lacks the financing and it lacks the visibility of the near-term sales levels. As a result, in an effort to avoid liquidating or a piecemeal sale, more companies are disclosing the risk of a chapter 11 filing earlier than ever before according to the WSJ.

Cheers, Mike


If you are a leader that graduated college in the last millennium, read this blog article from the online WSJ. It has some interesting points about what the facebook generation is expecting from leaders. One concept is the 'servant leader'. It is about using credible arguments, demonstrated expertise and selfless behavior to lead people.

If you are interested in the topic, there are two books ironically entitled, Servant Leader and The Servant Leader. If you do nothing else check out the article. If you are adventuresome, read one of the books. I read The Servant Leader twenty years ago and found it very useful.

Cheers, Mike

Wednesday, March 25, 2009


My buddy Rob directed me to today's NY Times which featured an email to AIG CEO Liddy from an EVP who was resigning. This is a MUST READ. This resignation tells the other side of the story very effectively.

As I have mentioned in previous posts on the topic, retention agreements need to be considered in the context of the problem situation and with all the relevant facts. And true leadership gets the facts and considers the alternatives in a prudent manner. Leaders don't overreact and pass ill-considered bills to tax bonuses 90%. The House looked pretty silly before this email became public. Now, they look worse.

As for Liddy, I posted on how he should have "worked the process". This email just adds support for the lack luster job he did in explaining this situation to Fed, Treasury, House and Senate.

Let me know what you think, especially you, Mark!

Cheers, Mike


Want to have some fun? For the past year, there has been an entertaining situation occurring at the exclusive Yellowstone Club. It is an ultra expensive private enclave with its own ski trails, 60 of them, and its own private Tom Weiskopf golf course.

It has everything you could want in a trashy novel. An interesting couple, the Blixseths who are the developers, who previously filed another company they owned for bankruptcy years ago. They then divorced a couple of years ago with the two of them fighting over the Club. There was the creative lending by Credit Suisse of hundreds of millions of dollars to the couple who allegedly used a significant portion of the proceeds for personal uses including other developments.

It has name investors, homeowners and board members including Bill Gates, Dan Quayle, Annika Sorenstam, Jack Kemp and Greg LeMond to name a few.

There was a lawsuit last year against the Club by LeMond which resulted in a multi-million dollar judgment against the Club. Credit Suisse has come under attack for loose lending to high flying developments such as Yellowstone.

Now according to an article on MSNBC, a bankruptcy judge has ordered a hearing on the auction of the Yellowstone Club in March. And according to this article, the auction is moving forward.

The Yellowstone bankruptcy was recently followed by the bankruptcy of the 200 year old Greenbriar Resort in West Virginia. How many more such bankruptcies and auctions will there be?

Cheers, Mike

Tuesday, March 24, 2009


Thanks for all your comments last week. Keep them coming. You don't have to log in to comment. Just click "comments" below any post to comment. You can also comment anonymously.

Gail and Mike


With all the economic gloom and doom, it is helpful to remember that there are still many well run companies in the world.

Fortune Magazine has two good articles World's Most Admired Companies in the March 16 edition and the 100 Best Companies to Work For.

The March 16 article states that across 20 countries, 62% of respondents say that they trust business less than a year ago. In the USA, trust in business is even lower than it was after the Enron scandal and the dot com bust.

But, let's get back to the good news. Well run companies. Hooray! Even banks and auto companies were on the list of most admired companies! Goldman Sachs, Wells Fargo, JP MorganChase, Toyota, BMW, and Honda. Google is the No.1 in the 100 Best Companies list.

What do these best companies have in common?

Talent, innovation, and financial strength.They focus on identifying and developing talent throughout the organization.

In a word, LEADERSHIP!


It appears that Geithner and the Treasury did a good job pre-selling the plan to remove toxic assets from the balance sheets of struggling financial institutions. This article in the NY Times suggests that Geithner spoke to various media and Wall Street players before going live with his proposal.

That is how a leader sells a controversial proposal. A leader goes to the parties most likely to support the proposal and gets them on board. A leader even elicits their input and makes them part of the process. The leader then asks for the supporters to be prepared to publicly support the proposals. Interviews of investors excited with the proposal are set up with the financial press.

Then the leader goes to a couple of parties likely to pan the proposal. An effort is made to educate the other side on the benefits of the proposal and to ask for their criticism before the public presentation. These parties won't suddenly support the proposal, but their criticism may be toned down somewhat and may not be as harmful.

This approach sets up the proposal presentation for success. Too often people come up with great ideas or proposals but don't spend the time to develop a plan to sell the proposal. The plan to sell the proposal is as important as the proposal itself.

Cheers, Mike

Monday, March 23, 2009


There is an excellent article in the archives of the Harvard Business Review on the challenges facing women leaders. Women and the Labyrinth of Leadership by Alice H. Eagly & Linda L. Carli.

First, let's start with some sobering statistics:
  • Only 1% of CEO's in the Fortune Global 500 are women
  • Only 2% of CEO's in the US Fortune 500 are women
  • Only 4% of the CEO's and Heads of Boards in the EU Fortune 500 are women
  • Only 15% of board seats of public companies are held by women
The article elaborates on the point that when you put all the pieces together a new picture emerges for why women do not make it to the C-suite. It is not only the glass ceiling but the sum of many obstacles along the way.

In fact women do not rise through the ranks the same as men and then all of a sudden hit their heads on the glass ceiling. They disappear in varying numbers at many points in their careers leading up to the glass celing stage. I have seen the same studies done throughout the professional services industry that proves that women in essence leak out of the system slowly and methodically at every stage of the ladder of "success".

The conclusion is that it is due to conscious and unconscious mental associations about women and men as leaders. The double bind that women find themselves in is if they demonstrate too many characteristics that people associate with women, they are not tough enough and do not have the "right stuff". But if they show too much of the tough, aggessive style thought to be a good leader, they are demonized as pushy , bitchy or worse. Again, they do not have the "right stuff".

I was at a leadership development workshop last week with 100 participants. The women in the group (about 10%) asked me at the end of the session, if I would work with them to create a network in which we could all help one another to succeed and if I would assist as a mentor.

If you have read my earlier posts under the "Women Leaders" category, you will know that I am now very passionate on this subject so of course I agreed.

As we began to talk, we discussed this issue of the double bind before a professor from Yale, Victor Vroom, suggested I read this article.

I was telling him that a boss of mine once said that the secret to my success was that I had an iron fist inside a silk glove. At the time, I thought it was just one of those odd things men sometimes say to women in business settings. However, I have since realized that he was spot on! I now realize he was saying I had found a way to navigate the labyrinth.

It is funny that Mike would post today quoting Ann Mulcahy on leadership. I have had the opportunity to meet her a few times at the Fortune Most Powerful Women in Business Summit and hear her address large groups. She is a perfect example of someone who has navigated the labyrinth. She combines the traits many of us think of feminine and masculine all into one great leader.

Note: You can read the entire article by going to HBR.harvardbusiness.org and putting the title of the article into search.


Ann Mulcahy, CEO of Xerox, was interviewed by a reporter from the NY Times. She made a number of good points including these on leadership.

She points out that not everyone is created equal when it comes to leadership. Some people are more advanced as leaders than others. It is important for leaders to identify those that have the talent to become leaders in the organization. She continues by saying that those people should be trained differently, compensated more and given more and a wider array of experiences.

She also said that "creating followship" is the most important thing that a leader can do. As Gail and I often say, "turn around and see if you have any followers, not those who have to be there. Look for those who could be anywhere and they choose to follow you."

Cheers, Mike

Friday, March 20, 2009


Ok, everyone is outraged at the AIG bonuses. But the President of the United States has spent enough time on this issue. It never should have risen above an assistant to Geithner. But as we say in the workout world, 'we are where we are'. The President was on Leno last night. According to Bloomberg, he said, "who in their right mind, when the company is going bust, decides we are going to be paying a whole bunch of bonuses to people?"

Well, it happens all the time. In the bankruptcy and workout world it is known as 'key employee retention programs (KERP).' Like most people, I believe that certain segments in the financial industry have been overcompensated over the years. However, when a company is failing, the leadership must make a decision as to which key people it needs to retain in order to maximize what is left.

In this case, the book of derivatives contracts is complicated and often incomplete. Traders often keep their own books of trades. Credit default swaps in particular are often not recorded immediately, there is a time lag. As a result, if AIG loses the people who brought them this mess, the situation gets even worse! I became aware of this speaking to the head of distressed trading for Bear Stearns and to the crisis manager brought in to run Lehman Brothers when it filed for bankruptcy.

The Bear Stearns managing director told me he that he and his team stayed around to work down their portfolio of trades. He said that it would not have been possible for an outsider to come in and even know what the trades were. At Lehman the situation was made much worse because it was a freefall bankruptcy and many of the traders just left and took their records with them. A number of them had to be hired back in order to make sense of what Lehman had.

You say, 'but where would the AIG people go?' The good people, (yes, even those who lost billions trading CDSs), can always get good paying jobs even in today's environment. So, what typically happens is a Key Employee Retention Program is put into place to reward people to stay and winddown their piece of the business. It is often much cheaper than the bonuses you would have to pay a new person to join a sinking ship and much more effective when done correctly. Who knows what AIG really did with these bonuses and whether it made good business sense.

So, while this situation looks very bad, it probably would be worse if those people did not stay on. I believe AIG's CEO Liddy was trying to explain this at the Congressional hearings. Unfortunately, he didn't explain it slowly and precisely so I think many at the hearing missed it.

Cheers, Mike

Thursday, March 19, 2009


Most discussion of leadership focuses mainly on the management team of an organization. However, another key leadership group of every organization is the board of directors. It seems to me that in the aftermath of this global economic crisis, it is critical that we discuss the roles and responsibilities of the boards of these companies. They have a fiduciary responsibility to the shareholders and an oversight role of management.

It does not matter if we are discussing AIG, GM, Lehman, or any other company. I still come back to the same question. Where was the board? Why aren't they being held accountable?

When congress holds hearings and drags the CEO's in for a grilling, why not drag in the board members? This question is applicable if we are discussing risk management or lack thereof; compensation that pays executives for the immediate profit but has no impact for later losses, etc.

The accountability of boards is an area that needs rethinking after the crisis.

Until next time,


There was a very good article in the NY Times yesterday on a CEO and leadership. The CEO of CCMP Capital, Greg Brenneman, was interviewed on his leadership style. There are some good nuggets for leaders.

One of the best was that it is more important than ever for leaders to focus on motivating employees during troubled times. Keeping everyone focused and motivated goes a long way to making everyone's lives a little better.

Cheers, Mike

Wednesday, March 18, 2009


Please click "comments" at the end of each post and give us your feedback. Thank you.


Gail's previous post set forth the general outrage about the AIG bonuses. This gives us a chance to explain a concept from our Leadership Workshops, Work the Process. The CEO Liddy is actually pretty innocent in this to a point. But he didn't work the process!

People often ask us, 'what does work the process mean?' So, I will describe it here. Liddy was not the CEO when the bonus contracts were entered into. He was appointed by the Bush administration when the original dose of bailout money went to AIG.

Working the process requires that you set the context in the beginning. Liddy should lead off every discussion on the contracts with "I was not connected with the AIG when the bonus arrangements were entered into. I came on board when......" This reminds everyone that he was not connected. Never take for granted that everyone knows this or will remember this.

The next step is that Liddy should have said, "My predecessor entered into these contracts. They were entered into at a time when the previous management thought AIG would remain in the financial products business and needed to offer 'stay bonuses' to retain their key people. I disagree with the stay bonuses and find them offensive." Work the process, lets everyone know where you stand.

The third step in work the process is to say "Here is everything we did to get out of the contracts. We hired a law firm that specializes in labor and contract law. We then....."

The fourth step is to lay out the results of the legal analysis. For example Liddy could have said, "Our attorneys gave us an opinion that we were legally obligated to make the bonus payments. I told the attorneys that the payments were ridiculous and I am not making them. The attorneys told me that if I didn't make the payments, AIG would be sued in court in the State of Connecticut where AIG would lose because it had no legal grounds for withholding the bonuses according to the contracts that had been signed. Worse, the attorneys said that AIG would be subject to the penalty of paying the affected employees double their bonus and their legal fees."

Finally, working the process properly would have required that Liddy present all this to the Secretary of the Treasury a month prior to the payment of the bonuses. He should have said, "Secretary I don't want to make these payments. But I have no legal standing not to make the payments. Let's work together to see how we can get out of making these payments."

Had Liddy followed work the process he would not be testifying in front of Congress today for contracts he inherited and had no way out of.

There you have it, Work the Process!

Cheers, Mike


$165 million in bonuses for AIG?!?! Will the madness ever stop?

I will not even go into all the issues with bailouts, TARP, and lack of government oversight. That is a different topic. This is solely about bonuses and compensation, which is out of control.

How did this company develop a bonus plan that made them contractually obligated to pay bonuses even if the company had the largest quarterly loss in history? I thought bonuses were funded by profits and paid for meeting or exceeding profit targets. Obviously, not at AIG.

Where is the Board of Directors? Where is the compensation committee? Shame on everyone! Shame also on the politicians who are now all shocked and outraged but gave them taxpayers money (under both administrations) without making sure this could not happen.

See also Mike's posts on AIG and one specifically on the bonuses.

Until next time,

Tuesday, March 17, 2009


In our Leadership Workshops, Gail and I often address fear. We believe it is important that leaders let their followers know that leaders also experience fear and it is normal. Leaders feel fear just like everyone else. They just do a better job of acknowledging the fear and moving forward in spite of it. Every leader finds their own way past fear. Some fake it, some look it in the eye and sneer at it, some singularly focus on a goal to block it out, but they all get past it.

There is a good article today in the WSJ regarding stress which touches on fear. Katherine Muller, who does psychology training at the Montefiore Medical Center is quoted as saying, "We'd say, 'I understand your fear, but fear is not a fact. Let's look at the reality in your life.'" Leaders must be particularly sensitive to people's fears during these economically uncertain times. People are worried about their futures and their children's futures.

Leaders must be more communicative and get their people focused on working the process so they can acknowledge their fears and move on. As best as I can tell, worrying never made anything better. In fact, it makes things worse. Worrying leads to less sleep, less of an appetite, and more stress. The article also speaks to stress in a succinct way. It is a very good read for all, especially leaders. Leaders can then help others deal with the fear, worry and stress.

Cheers, Mike

Monday, March 16, 2009


The FASB has finally indicated a willingness to consider some relief on the mark-to-market accounting for some bank assets according to CNBC. The FASB is planning to hold hearings to get input on relaxing the mark-to-market accounting rules. The Board is apparently looking at two questions that should be considered in valuing the relevant assets.

Is there an active market for the asset? Is the market for the asset distressed? Even though the majority of the assets held by financial institutions are not subject to mark-to-market, I believe this is an important step to stopping the continued downward spiral. As I have posted before, the market value applied must be a fair market value. This means a willing seller and a willing buyer. The current market does not have willing sellers. The world is going through the greatest margin call ever. The values are much closer to liquidation value than market value.

I know the opponents to relaxing the accounting, such as the SEC, argue that transparency is more important and relaxing the accounting will result in marking to model. Something Enron did which became known as Marking to Enron. Yes, it will result in marking to model. Specifically, it will result in valuing the expected cash flows as opposed to what a few scarce buyers will pay. See this article from Bloomberg.

I am a big advocate of transparency. But the issue is 'what is the most appropriate value?'. It is not 'what is most transparent?' If the mark-to-market rules are relaxed for Q1, look for the Q1 reported profits of financial institutions to jump markedly. It should also result in the softening of worldwide negative sentiment as the downward selling pressure lessens.

Accounting usually makes people's heads spin, but this concept and its application is important and will impact us all.

Cheers, Mike

Sunday, March 15, 2009


We all seen various articles and headlines regarding AIG's proposed $165 million bonus payments such as this one in the NY Times. But where is the data to evaluate to bonuses?

For all the talk about transparency, you can't help but get the feeling that many of the government's bailout actions have been taken without the benefit of the data or of analysis of the data. So as for the proposed bonus payments, I would like the following data. I want the bonuses broken down by business segment, by groups within each segment, by individual and by type of bonus.

For example, how much of the $167 million is for the group in London that wrote the vast majority of AIG's credit defaults swaps which are the primary reason for the AIG bailout? How many individuals are receiving a bonus? How much compensation did they receive in 2008 before the bonus? How much compensation has that group and those individuals received for each of the past three years?

If the credit default swap group lost hundreds of millions in 2008, one might be inclined to withhold their bonuses. I know, the lawyers say the agreements say AIG is obligated to pay them. Well, AIG probably didn't contemplate that the group would lose hundreds of millions when it entered into those agreements. And even if the results were not an 'out' in the agreements, one might still take the position of 'We are not paying your bonus because of the horrendous results that border on gross negligence. If you want the bonus you are going to have to sue us and face a court of law and the court of public opinion'.

On the other hand, if the property and casualty insurance underwriting made a handsome profit, then maybe some of those bonuses should be paid, especially if they were retention bonuses to keep top performers.

But can someone please get the data and use some good business judgment and that rarest of commodities, common sense.

Cheers, Mike

Saturday, March 14, 2009


Here is an interesting and somewhat entertaining short NY Times article on a guy who flies around the country tracking down planes that banks are foreclosing on. It gives an inside look at what banks are doing with just one class of loans.

I have a story about how it works from the other side. A number of years ago I advised a private equity investor who had two planes. I asked him how many people from his firm used the planes. He answered that only he used the planes. So I asked, "Why do you need two planes?" To which he replied, "Sometimes, one of the planes is in for maintenance. So I need a backup plane."

A couple of weeks later I called the bank that leased the planes to my client. "Jim, it is Mike. I have some good news and bad news for you." Jim replied, "Give me the good news first. I am swamped by bad news."

"The good news is that we are voluntarily returning your two planes." Jim happily replied, "That is great! What could the bad news possible be?"

"Well, the Falcon 100 is at Morristown Airport ready to go. But the Hawker 1000, well, to tell the truth, I don't really understand the science behind how planes fly."

"Mike what does that have to do with the Hawker?" I replied, "Well Jim, the Hawker fuselage is in Delaware, but the engines are in Kansas City. And I am pretty sure they need to be together. Oh, and the bank owes $110,000 for the engines and past maintenance bills. I gotta go."

This is playing out everyday at banks throughout the world in every asset class; homes, planes, yachts, commercial real estate, companies etc.

Cheers, Mike

Friday, March 13, 2009


Last night was so much FUN!

About 80 of my friends and former colleagues got together for a reunion. They were all from the New York office of Arthur Andersen's business, systems integration and risk consulting businesses. The event was hosted by Deltek (www.deltek.com).

For those of you too young to remember, Arthur Andersen was the largest global professional services firm in 2001 and it was brought down in 2002 by the Enron scandal. We laughed, told many stories that were oldies but goodies, drank lots of alcohol(Diet Coke for me), found out what people are doing now, and just had a great time!

So why do you care? Why is this worth posting on the blog?

Because during and after all the laughs, many of us made several observations worth sharing on the following topics:

Life is about family, friends and community. Careers and jobs are how we earn a living to fund our pursuit of activities with family and friends. Yet somehow we get so caught up in the career that we often lose sight of this fact. But this group last night and many similar ex-Andersen groups around the world were fortunate to be able to integrate lifelong friendships with work and career.

While we all suffer through this global economic crisis, it is a good time to remind ourselves and keep repeating the mantra "life is about family, friends and community". What was even more special about last night is that we were with old friends. Those with which we share a very special history.

Amidst the din of laughter and clinking glasses, everyone was networking. Business cards were being passed around; someone was explaining to a friend how to twitter; another guy was giving someone advice on their website; and a few business deals were initiated. My friends from Deltek, a software company serving the consulting space, were working the room and becoming part of this powerful network.

We all know that some good can come out of even the worst situations. Well one positive that has come from the demise of Andersen, is that all 150,000 ex-employees, from around the world, share a very powerful and widespread professional network. I was at a similar event last week in Chicago and the same thing occurred that night.

The other positive that came from the tragic end of the firm is that all of us have not only survived but thrived. This was a room of powerful, successful people. Yes, we all went through hard times but we came out the other end just fine.

Now a few last night have been affected by the latest disaster known as the global economic mess, but they know they survived one mess so they will do it again. Not the way we would have wanted to learn, but learn we did. We are all seasoned business people today who have been up, down and out, yet thrived through it all.

Throughout the night I heard over and over again, how special our Arthur Andersen days were to us. How much we all learned. How loyal we all were to the firm and still are to one another.
It was a very special place.

Remember, this company came apart in 2002. That was seven years ago! Yet people are still ready to get together in large numbers in cities all over the world. When they get together, like last night, the energy in the room is palpable!

What are the unique ingredients that create that type of corporate culture that can live on even after the company is gone for so long? The companies that replicate that cultural strength and loyalty will have a great asset.

What went wrong? Open invitation to my ex-Andersen colleagues: Share your comments to this post and are you willing to be interviewed so I can delve deeper into these questions? Open invitation to our other followers: Share your comments as we need outside perspective. Are you willing to be interviewed?

Until next time,


There have been so many other issues out there, that there has been little in depth analysis of the pension liabilities that many companies carry. But in the near future, the financial press is going to look at companies obligations versus the assets available and find a huge negative gap.

I am assuming that most pension plans used around a 7% return on investments in their actuarial calculations for 2008. I also assume that most pension plans actually incurred a loss of 20% - 50% on their portfolios. The huge gap has to be filled somehow. Unfortunately, it will primarily come out of the employees covered by those plans and the taxpayers who will have to make up the difference through PBGC claims and perhaps, another color of a bailout.

Thursday, March 12, 2009


As bad as the US financial picture is, the UK financial picture may be worse. Unbeknown to most, prior to 2008, the consumer debt per capita in the UK was higher than the US. The real estate bubble, especially in London, was greater than US trouble spots in California and Florida.

Further, London has been challenging NY for the finance capital of the world this decade and as a result the banks were growing quickly through mergers and acquisitions. Well as of today, the bailout money that the British government has extended to the banking system is 16% of the UK's GDP.

You know how bad the US problem is, but for all the bailout money given out so far, it amounts to only 6% of GDP. And although neither government is done extending bailout funds, the UK problem may be a bigger problem relatively than the US problem. This argues for the British pound to continue to fall against the dollar and the euro. The only thing that keeps the pound up against those currencies is that the euro and the dollar are in so much trouble themselves.

Cheers, Mike

Wednesday, March 11, 2009


There is an opinion piece by Greenspan in the WSJ today. He makes the case that the Federal Reserve didn't cause the housing bubble. Well, check out this article from the NY Times 1999. You can see for yourself what happened at the time of the article, September 1999. In hindsight, it was the fuel that fed the housing bubble fire. It is very interesting and one can squarely put the initial blame on Clinton Administration.

It is also very interesting in hindsight, to read the quotes of people at the time, that Fannie Mae's easing of credit and lending standards would lead to a housing bubble that would be disastrous. Read it, it is only one page.

And thank you Dennis, for sending a copy of the article my way.

Cheers, Mike


If Bernie started to promise people 40%+ returns, it must have happened toward the end when he desperately needed money and the markets were generating 20%+ returns for a couple of years. If this is true, he was speeding towards his demise at the end.

A 40% return doubles the principle in TWO years! Even for Bernie it was going to be impossible to bring in enough new money if some of it was supposed to double in two years. This further explains the enormous level of false profits in the size of the fraud.

It should be interesting to see what the prosecutors and the trustee have uncovered to explain all that happened over the past years.

Cheers, Mike

Tuesday, March 10, 2009



We attended a meeting with the lenders to Sunbeam, whom we were advising, and with the crisis managers advising the company.

I said to the crisis manager, who was a name partner of the firm, “What are you going to do about the Chinese vendors?”

He replied, “We are going to tell them that if they don’t play ball, they will be off the reservation.”

Hmmm, and how well do you think that will translate into Chinese?”


According CNBC, the SEC is contemplating putting the uptick rule back into effect. This will help out. On the other hand, CNBC reports that the SEC does not look like it would back changing the mark-to-market rules.

One of our followers commented offline that the SEC also should not have allowed ETFs that double and triple short the market without any margin requirements. Seems like a good point to me.

Gail and I are back this afternoon from London and ready to blog on.

Cheers, Mike

Monday, March 9, 2009


I always enjoy reading Ben Stein. Maybe it is because I can hear his deadpan voice and see his face when I read his articles. Today's NYTimes has a very good piece on three steps that can be taken to stop the negative financial feeding frenzy.

First, SFAS 157 which sets forth the rules for mark to mark accounting must be changed to make it less stringent. I agree totally with this and post as such back in December and January. The current rules exacerbate the problem because too many financial assets have to be marked to market to the current market value which is defined as what the last sale price was or what someone will pay today.

The problem is that many of the sales are being made by forced sellers to bottom feeder buyers. It should be based on a willing seller to a willing buyer and today there are very few willing sellers. Some say, no that will lead to market values based on a model. I say, 'bullocks', ( I am in London). The current market values are more liquidation values than market values.

The SEC studied mark to market accounting in the fourth quarter of 2008 and concluded no change was required. Thank you Christopher Cox for your unending efforts to help the situation. The SEC was very proud that it issued the report a couple of days early. Perhaps they should have taken the extra time to come up with something useful.

Second, Ben says, put the uptick rule back in and get rid of naked shorting. The uptick rule requires an uptick in the share price before a short sale can occur. And naked shorting allows one to short a stock before owning/borrowing the shares. These measures put enormous downward pressure on equities and should have been fixed in September 2008 when the short-term ban on shorting financials went into place. This uptick rule was suspended a couple of years ago by the SEC. Thank you Christopher Cox, again.

Third, Ben says stop the practice of allowing the issuance of credit default swaps to parties that don't hold the underlying debt and therefore do not have a direct insurable interest. I wrote about this practice last week under the AIG post. Had this been in place AIG would have had much fewer credit default swaps and would be in better financial condition today. I am not famaliar with the SEC stance on this one.

Fourth, Ben didn't say this because it is too late, but the SEC in 2004, or there abouts, relaxed the requirement that the investments have 12 to 1 or less leverage. The investment banks then moved to 25-35:1 leverage in the past few years and so, here we are.

Cheers, Mike

Saturday, March 7, 2009


Gail and I are in London for a few days to present a couple of Leadership Sessions. We will be posting from here on Euro issues.

Cheers, Mike


The WSJ reports today on the list of institutions that benefited from the first few AIG "bailouts". I guess some politicians are expressing shock over this. Why? Ironically, I posted on this on Wednesday and said, in answer to Jim Rogers saying AIG should be allowed to fail, that many of the counterparties to AIG were the same institutions that received TARP money.

Now according to this article politicians are upset. Hello, have your staff do some research and not a lot was needed. It was always obvious that the Credit Default Swaps entered into by AIG's London office were the root cause of AIG's problem. Given that, anyone who knows what CDS means knows, that means very large institutions were on the other side of the swaps and if they were entered into by the London office, that would suggest that many of them were foreign institutions.

Was it that hard to figure out? AIG was always a bailout of the financial system not of AIG itself. Isn't that why in a three period in September that Paulson and Bernake decided to let Lehman fail and not to let AIG fail? Fact is, they should have dealt with Lehman differently but I suspect that parties around the table had their own narrow self-interest in mind as opposed to the broader picture. And they got that wrong also.

Cheers, Mike

Friday, March 6, 2009


Check out this article in the NY Times suggesting that Bernie's $50 billion is much lower in reality as I laid out on the Wednesday. The article didn't attempt to explain where the cash may have gone other than ficticious profits.

Cheers, Mike

Thursday, March 5, 2009


According to a report in Bloomberg, there are increasing examples of traders almost pushing companies toward bankruptcy in order to benefit from credit default swap trades. The way it works if as follows. You buy a $1000 bond for $200 because the borrowing company is in such financial trouble. You then by insurance on the $1000 bond for $700, known as a credit default swap (CDS), which will pay you a $1000 if the company defaults on your loan.

The trader now would prefer bankruptcy over a restructuring because if there is a bankruptcy the trader gives the bond to the 'insurer' and receives $1000. So the trader gets $1000 and only spent $200 for the bond and $700 for the insurance. That's $100 profit. Multiply it be the number of bonds purchased and it is almost a no brainer for the trader. Unless of course the 'insurer' is a Lehman Brothers and fails to pay making the trader's CDS insurance an unsecured claim in the bankruptcy of the insurer.

As a side note, to make matters worse the 'insurers' also wrote CDS for traders who didn't own the underlying bond. Very similar to insuring a house for your benefit that you don't own. Think you would care if something happen to the house from a selfish financial standpoint?

Selling such insurance to traders that didn't own the underlying bond is how AIG was able to make large profits, pay large bonuses and then incur large losses and may continue to incur such losses. The press has been quiet about the looming CDS problem only because the other problems are too large and too immediate.

Cheers, Mike

Wednesday, March 4, 2009


(The Madoff Palm Beach Home)
One of our followers posed the question, 'Where did the money go?' Back in January I speculated on where the money went, but that was before Irving Picard, the SPIC trustee, disclosed that Madoff didn't purchase any securities for his fund for 13 years.

I haven't seen any analysis to answer the question at hand. So I will try to speculate again. However, I am going to need help. Please comment or email me with suggestions, serious suggestions only Univac, as to where the cash may have been gone.

Here are my latest thoughts. First, it wasn't $50 billion, Bernie rounded to the nearest $50 billion. After all why would we believe the figure he said? It is probably lower. So let's say that the accounts totaled $43 billion at December 15, 2009.

Second, the figure was inflated by false profits for, let's say 30 years. At a 12% fake rate of return, the principal would double every SIX years. So for example, if Bernie was running $100 million in 1979, that be $3.2 billion in 2009! So that is $3.1 billion of fake profits or said another way, of the $3.2 billion in those investors accounts, 97% was from fake profits. Another example is one of the educational institutions that originally said it had lost $125 million and later said it only invested $14 million.

Additionally, say Fairfield/Greenwich, one of the feeder funds which allegedly had $7 billion invested with Madoff, put the money in on average in 2003. Therefore its hypothetical $3.5 billion investment would be worth on paper $7 billion at a 12% rate of return. Some $3.5 billion of fake profits. And if the rate of return was 20%, the initial investment may have only been $2.3 billion which would have tripled to $7 billion or fake profits of $4.7 billion!!!

Third, the compounding of returns from 12-20% over 30 years requires an enormous amount of cash coming in every year to fund redemptions and withdrawals.

Fourth, there still were investments that were made over 20+ years that lost value or at least didn't keep up with the fraudulent rate of return.

Fifth, and a minor number in this fraud, is the money that used to fund the operations and the extended Madoff family's lifestyle for 30 years. That may included the $70 million Ruth is trying to keep. Throw in the Palm Beach house, the Hampton house, the French Riviera house, a plane, the kids homes and spending for 20 years each since they worked at the fund. Then throw in all the donations made by the extended Madoff family.

So a hypothetical summary, with no empirical data to support it, may be as follows:

Fraud $50 billion

Rounding $ 7 billion
Fake profits 30 billion
Investment losses 5 billion
Withdrawals 6 billion
Madoff take 1 billion
Found by Trustee 1 billion

These number are submitted for illustrative purposes only. I made them all up without a shred of evidence. Let me know what you think.

Cheers, Mike


Jim Rogers is a very bright and entertaining fellow. I have read two of his books which I highly recommend. The first one is I read was Investment Biker. The second book I read was Adventure Capitalist: The Ultimate Road Trip. They are great reads, both informative and entertaining. I highly recommend them with a new map of the world from Barnes & Noble. This way you can follow him around the world to new countries you have never heard of before. Most of them end in 'stan'.

Anyway, Jim Rogers made the case on CNBC yesterday that AIG should be allowed to fail rather than it and other failing financial institutions take down the US. I haven't studied the issue, but my visceral thought is that AIG should not be allowed to fail like Lehman. The unplanned bankruptcy resulted in a greater dissipation of value. Many of Lehman's profitable financial contracts (many of them credit default swaps) lost much of their value by giving the counterparties leverage they wouldn't have had if Lehman was allowed to orderly winddown much of its portfolios. And, of course, Lehman's negative positions rendered those counterparties unpaid creditors.

Letting AIG fail at this time will likely result in even greater destruction of value than is occurring. So the question is, 'who is currently getting the benefit of this value?' Interestingly, many of the AIG counterparties who are owed money by AIG are benefiting from the Government's stream of capital infusions. Many of these counterparties are the same financial institutions that are receiving TARP funds at least according to Hank Greenberg the former Chairman of AIG. It all makes for interesting bedfellows and cascading unintended consequences.

If I had to have an answer by noon today, I would suggest splitting AIG into its various core businesses. Some of those businesses are presumable profitable and being tainted by the credit default swap portfolio. I would separate out the CDS portfolio and put in a new team to work it down. And then I would indicate what funds are going where so as to make the issues as transparent as possible.

It does make you wonder why it isn't so transparent.

Cheers, Mike


Calling all leaders! You can not develop talent without candid feedback and coaching.

An anonymous but wise individual once said, "Good management is not only the gift of identifying talent, but the art of selective recognition of strengths and weaknesses, and the proper encouragement of the best in any man or woman."

One of the stories in our book is Spend More Time with Your Stars, Not Your Duds. This entire post is about the time you spend with your stars. You can help them develop and be even better then they thought possible, if you give them candid feedback and coaching.

Let's start with the feedback:
  • Feedback must be VERY candid and honest. Do not sugar coat. Be straight forward.
  • Feedback should be timely. On your way back from the sales call, not 3 months later.
  • Informal and formal feedback are both required and should be consistent.
  • Tell them what YOU think, don't pass the buck by saying this is what others are saying.
  • Be specific. 'You were great' is just as useless as 'you were awful'. Instead, you were great can be followed by- when you answered the client's question because you were confident and spelled out the three things we would do for them that was different from our competitor. 'You were awful' can be followed by, 'I was so surprised when you hesitated when the client asked that question. You knew the answers, why were you so hesitant? It made us seem unsure of our action plan'.
  • Provide positive feedback as well as constructive criticisms
Now, let's move on to coaching:

The best feedback still needs to be backed up by coaching. So now, I know what I did wrong but how can I fix it? Or, thanks for the positive feedback. How can my strengths be leveraged for even better results? How can I advance my career?
  • Candidness is required here as well. What do they need to do to improve? How can they leverage their strengths to continue to succeed? What else do they need in their skills portfolio to achieve their goals?
  • Make sure you know what are THEIR goals- not yours projected on to them.
  • Make a specific plan of action
  • What are you as the leader willing to do to help?
There is an article on the subject How to Provide Feedback That Has an Impact.

Leaders need to provide candid feedback and coaching to ALL employees.

Leaders need to provide more feedback and coaching to their stars. The ROI is better then when done with under performers.

Now, why is this especially true for women as the title of this post asserts? In my experience, this is often one of the unintentional disservices done to women in business. The feedback is sugar coated. The coaching is often superficial.

Over the years, when I was the leader reviewing the overall ratings and promotion recommendations, I noticed that sometimes the verbal comments I was told did not coincide with the written evaluations. The written was more positive then the verbal. As I asked more questions and eventually asked why didn't you tell them that, the answer was "I didn't want to be too hard on them". I also noted that while not done exclusively to women it was done more often to them.

On coaching I noticed that too often the women were not given some of the casual and informal feedback that the men were given simply because they were not driving to and from the golf course or softball field together. Again, not a plot against women, but still unfortunate.

So we need candid feedback and quality coaching for all employees. If my experience is indicative of the business world, then we need to be even more careful to make sure we do this for the women on our teams.

What can we all do?

Be great leaders and give candid feedback and coaching to all your employees.

Women, demand candid feedback and coaching! Keep pushing until you get it. Tell your boss you can handle it and want to hear every little thing and then, act on the feedback.

Until next time,

Tuesday, March 3, 2009


Bernie, Bernie, Bernie. Seriously, you just bilked thousands of people and charitable & educational organizations. Your wife moved $10 million out of your Fund the day before you 'randomly' decided to 'confess' to your sons.

Now you want your wife Ruthie to keep her $70 million? Of course, none of this $70 million came from you Bernie or from your ill gotten gains. And, of course, she had no knowledge of your 30 year Ponzi scheme.

I don't know about you, well actually I do, we are all rooting for the prosecuters to take everything and send the whole bunch to jail. Incidently, what is taking so long? Cheers, Mike

(courtesy of AP)

Monday, March 2, 2009


The Secretary of the Treasury needs to act as a Crisis Leader during 2009. He needs to get in front of the issues so that he is looking back from the finish line. He then can speak to the issues, the plan and the process to emerge from these dark days.

He also needs his own PR person to constantly make sure his message is properly delivered to the right audiences. For example, his office should stop using the term "bailout". Look at the AIG term sheet from this WSJ article. The Treasury clearly lays out the reasons for the approach they are taking. Steps like these need to be clearly and concisely laid out in order for people to understand that there is a sound basis for the steps being implemented.

Also, people can't see 'good' until they see what 'bad' looks like. The AIG plan may look bad, but the alternative is really bad. Once you look at the alternative, the AIG plan appears better. But it has to be properly presented and explained.

To this point, there needs to be a crisis plan articulated by the Treasury so people can believe that the leadership is on top of the situation, even if the final answer is not apparent. The overall crisis plan needs to lay out a well thought out process than gives people confidence. And it needs to be presented NOW!


There has been quite an uproar about Northern Trust "lavishly" entertaining clients at the PGA event at Riveria CC last week. John Paul Newport addressed this situation in his weekly article in the Wall Street Journal on Saturday.

It really is an interesting situation. NT received $1.6 billion of TARP funds last fall. The politicians, the media and many taxpayers are saying, "why is our money being used to throw parties?" On the other hand, NT says, "hey, we made record profits in 2008, our balance sheet is fine and we only took the TARP money because the government asked us to." NT is doing business as usual, entertaining clients.

This is certainly not a black and white issue. There are also unintended consequences. Companies throughout the world are cutting back on spending, especially for outings. What about all the companies and people who depend on such outings for their livelihoods?

What about all the people who work at the Cloister in Sea Island which has seen numerous cancellations? Or those at Turnberry Isle in Aventura, Florida who saw companies like Goldman Sachs cancel a big three-day conference? Or the Greenbriar which has seen occupancy plummet?

My humble view is that the criteria should not be whether an institution took TARP money or not. It is whether the institution is profitable. If a bank was profitable in 2008 (no small feat) and then it is spending its profits. If it was unprofitable, sorry, you can't spend like that until you become profitable. Why punish an institution that is profitable? And then punish a whole industry that supports numerous jobs?

We must remember the economic theory of the velocity of cash. Those who have excess cash above their current and future needs actually need to spend cash. Profitable companies need to spend cash. This cash goes to companies that pay workers who spend that cash to live to other companies that pay other employees that pay cash to live to other companies and so on.

Imagine if every single person stopped spending anything except the most basic of necessities. More and more locations and companies would close, more jobs would be lost, more government spending would be required, more debt would be incurred and it would get even worse.

The political leaders, the TARP recipient leaders and the media must look at the impact on ALL the stakeholders in any given situation before reacting.

Cheers, Mike

Sunday, March 1, 2009


Warren Buffet's Annual Report letter is always a good read on a rainy, snowy Sunday. Check it out. If nothing else it is entertaining and the world's greatest investor wasn't able to get missed by the carnage of the 2008 markets either.

Cheers, Mike