Tuesday, April 29, 2008

I get it

Companies flip back and forth from publicly traded to privately held status. In addition to the usual explanations (cashing out, currency for acquisitions, etc.), I think I now understand one more: the grass is always greener. Public company managers look fondly at avoiding quarterly targets and disclosure. Private company managers dream about being widely held and losing activist shareholder/directors.

But the bias is likely towards the second - the sinecure of a (widely-held) public company is very attractive to management.

Monday, April 28, 2008


"The idea to suspend the 18.4 cent federal gas tax and 24.4 cent diesel tax from Memorial Day to Labor Day was first proposed by McCain, the likely Republican presidential nominee, as a way to lessen the pain at the pump for consumers this summer.

Clinton said she would make up the lost revenue by imposing a "windfall profits tax" on oil companies."

If this is sincere, it is reprehensible. If this is disingenuous populism, it is merely ugly.

I have no idea whether or not Obama has any similarly counterproductive proposals but the fact that 2 of the 3 people who are mostly likely to be president support removing the gas tax (and perhaps to create a "windfall" profits tax) is scary.

Tuesday, April 1, 2008

The Fed's Role

When exactly did the Fed begin being responsible for and judged on the day-to-day performance of the stock market? Two thoughts related to this: (i) the Fed has historically been responsible for the overall economy (and, in my view, should only be required to maintain price stability in this regard); and (ii) I think that the broader ownership of equity (generally considered to be a good thing) has made the stock market a legitimate area for government intervention. In other words, instead of being a barometer, the market is now the weather itself.