With the weekend here, you might want to take some time to consider the following:
- Another bad quarter for portfolio holding General Motors (GM/NYSE), which announced today it lost $15.5 billion over the past 90 days. The stock closed threatening to break back below $10 a share. Hard to believe it was trading above $40 last October. There's no shortage of GM stories available on the Internet, and John Stoll of The Wall Street Journal is doing his normally excellent job covering the goings-on with the company. If you subscribe to WSJ.com check his work out. Whether you do or not, take a moment to read Joann Muller's piece in Forbes on GM, with quotes from GM President Fritz Henderson.
- Jason Zweig's recent column asserting that Benjamin Graham would not be a buyer of bank stocks today has generated lots of buzz online (and off, too, I'm sure). Geoff Gannon of Gannon On Investing has done a great job covering Zweig's opinion and comments on it. This post discussing Tom Brown of Bankstocks.com's article on Zweig's column also links to Geoff's own. I have no thoughts on this -- except that I'm staying away from bank stocks myself. As you've read me say previously, I just don't know if you can trust the balance sheets of those institutions. But the stuff you'll find on Geoff's blog is really fascinating. And reading smart guys like Geoff, Tom Brown and Jason Zweig reminds me that I'll never be mistaken for a genius.
- With lower ad spending, media stocks are hurting, which makes them attractive to many value-oriented investors. Portfolio holding CBS (CBS/NYSE) announced results this week. And Les Moonves is looking to sell off 50 radio stations to fund further share buybacks. I like that, but the fact is CBS is a boring company and will remain a boring story until an economic recovery brings higher ad expenditures. Fortunately, we're paid to wait until that happens thanks to a fat dividend yield.
- If you like geopolitics, you'll love Michael Sesit's Bloomberg column on French President Nicholas Sarkozy plans for a Mediterranean Union of 43 countries. It would consist of the European Union's 27 members, 14 non-EU member countries that border the Mediterranean Sea, as well as Jordan and Mauritania. Sesit notes the differences with the EU: "By contrast, the Mediterranean region is a hodgepodge of European, Arab and African states consisting of democratic regimes, monarchies and dictatorships -- some with a strong religious orientation -- and made up of Christians, Muslims and Jews, most of whom don't get along." Sounds like a tall order.
- Take the world's 4th-largest arms company, more than $49 million in payments to an ally of a dictator, and mysterious developments in places ranging from South Africa and Zimbabwe to the UK and the British Virgin Islands, and what do you have? No, not a James Bond thriller or new work by Frederick Forsyth. But the lead story in the latest issue of Africa Confidential about Britain's BAE Systems and potentially secret payments to a buddy of Robert Mugabe. Like they say, you can't make this stuff up.
Whether we're in a recession or not is largely academic. We're in an economic downturn and a Bear market. Let's hunker down and have a great weekend despite it all. Patience is a virtue. And can ultimately prove profitable.
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