NBC reports that only 22% of voters think the county’s on the right track – and the Dow breaks (surges?) through 13,000.
Fine with me.
And speaking of cheery news:
These are the warrants we originally bought a year ago at 70 cents and then again as low as 38 cents, back when the company was called Aldabra, when all it had was cash and no business. Then, you’ll recall, it traded that cash for a business, Great Lakes Dredge and Dock, GLDD, and now, a year later, the warrants closed last night at $3.06.
So – on paper at least – you have made anywhere from 4 times to 8 times your money in a year, with nearly two years left to run before the warrants expire.
A chunk of my own position went long-term yesterday, so I sold it, recouping my original investment. I’m in no rush to sell the rest, in part because it would still be taxed as a short-term gain, and in part because I’m hopeful more upside remains.
First suggested here nearly two years ago, at $52.5, American Express has done better than it seems, closing last night at $62.32, because you also got a fifth of a share of AMP in a spinoff, which at current market prices adds another $12.20 . . . plus a couple percent more in dividends . . . so before tax, you’re up nearly 44% . . . unless you bought the LEAPS, in which case you took more risk but have a significantly higher return. I’ve sold some of mine, but not all.
BLAH BLAH BLAH
Notice I’m not talking about the ones that have been ‘blah’ at best, like GE, up just slightly since it was suggested it – let alone those ill-fated Google puts I hope no one but me took a flyer on.
One stock not hitting new highs these days is First Marblehead. I’m betting on this one to rebound, along the lines described yesterday by bankstocks.com co-founder Tom Brown. If you missed it last year at $25.50, and if you can afford the risk, FMD could be a good buy today at $36 (down from $57 earlier this year).
One of the links to this site was bad yesterday (now fixed).
Michael Axelrod: ‘With the huge amount of identify theft around these days (you can buy a phony ID packet on the streets of LA for about $300), the lenders are taking a big risk. An unsecured loan is mighty hard to collect on. Why do think loan sharks use baseball bats?’
☞ Well, it will be interesting to see how this works out. If you’re using Prosper to borrow, I don’t see any special risks; just the possibility of lower costs. If you’re using it to lend, then the risks are significant – especially if you’re not spreading your money over dozens of different loans (with their automated feature, which makes it easy).
It’s possible that Prosper borrowers may actually prove to have a better repayment rate than would be expected from their credit ratings, because (perhaps) they will feel more loyalty to ‘people’ than to a credit card company (and because, if they’ve gotten a lower rate, it should be at least slightly less onerous to make the payments).
But it’s also possible that a lender will be less frightened of stiffing Prosper than stiffing MasterCard (even though their default would get reported to the credit bureaus in exactly the same way). And it’s possible that what a 750 credit rating (say) may mean in the population ‘as a whole’ may wind up being quite different from what it means in ‘just that odd special niche of borrowers who find themselves going to Prosper for a loan.’
Prosper is not an appropriate place for someone with $30,000 to invest that $30,000. But if you’re a retiree with (say) $600,000 and time on your hands, and were intrigued to put $30,000 to work at Prosper in hope of netting a better return, after bad debts, than you could from a money market fund – with the added kicker of feeling that you helped out some younger folks whose stories appealed to you – well, I can think of dumber ways to risk $30,000.
Quote of the Day
Market economics as currently practiced often ... includes only what's countable, not what counts.~Rocky Mountain Institute
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