April 5 Deadline. You’re Joking, Right?

Thanks for the input.  Tweak by tweak, we enter the 21st Century.  E-mail delivery should have resumed with this column.  For those who weren’t getting it that way but want to, see EMAIL DELIVERY at right.

THE NEXT FINANCIAL DISASTER

As usual, “UP w/Chris Hayes” was the most substantive thing on TV this weekend (although “Desperate Housewives” certainly made a bid for contention as the series nears its finale; and “60 Minutes,” as ever, was not to be missed). This segment, in particular, is worth the watch: on how the J.O.B.S. bill about to be signed into law will do little or nothing to create jobs – or perhaps do worse, as previous rounds of financial deregulation did.

According to one of the show’s several impressive guests, the bill is an “atrocity” that could lead to the next meltdown a few years from now.

(Note that this unfortunate so-called “J.O.B.S.” bill has nothing to do with the American Jobs Act that the President urged Congress to pass “right away” last September.  That one was about jobs, not financial deregulation.  It was about infrastructure. It cried out to be enacted.  It still should be.  It would have employed people through private contractors to do things – like repairing 154,000 failing bridges and modernizing 35,000 deteriorating schools – that need doing.  It would have strengthened the economy and our future, and still would.  The Republicans say: no.)

BOREF – TOO SMALL TO BE THE NEXT FINANCIAL DISASTER

Jim S.: “I received an email tonight from Borealis containing the following: ‘We are offering one share in WheelTug plc for every 5 shares of Borealis.  This offer is open until 5 PM GMT on 5 April.  There is a Private Placement Memorandum outstanding for WheelTug shares.  If you are interested in trading Borealis shares in for WheelTug, you must email [so-and-so].’  I don’t own much – about 175 shares purchased when the stock was about $10 more than it currently is (ouch!).  Since this would appear to be a chance to get in on the ground floor before a potential public move, maybe it’s worth it?  I guess we have to figure out if we think Wheeltug will eventually be worth more than the parent to know if it’s something worth doing.  Any thoughts/advice, given that this is money that I can afford to lose?”

☞ This offer is so bad (and so bizarre) it just adds to our little company’s delightful je ne sais quoi.  WheelTug is owned mostly by its parent Chorus Motors which is owned mostly by its parent Borealis.  According to this WheelTug page, Borealis owns 6,187,712 WheelTug shares (indirectly via its Chorus Motors subsidiary).  There are 5 million Borealis shares (you, Jim, own 175 of them), so if all this is accurate, each Borealis share indirectly represents about 1.2 WheelTug shares.  So in a sense, you currently “own” about 200 WheelTug shares. My math be off if I’m not reading the various websites right, but it’s something at least vaguely like this.

They are offering to exchange your current holding for 35 WheelTug shares. (Of that math, I am certain: you get one WheelTug share for each five BOREF shares, so 35 for 175.)

You’d go from an indirect ownership in about 200 shares to a direct ownership in 35 shares. And you would be giving up whatever other value Chorus Motors might have (if the motor actually works for planes, might its underlying technology have other applications?) and whatever value the several other Borealis subsidiaries might have. All for a chance to own 35 WheelTug shares directly instead of 200 indirectly.  (“But hurry! This offer expires April 5!”)

The mind boggles.

PAUL RYAN’S BUDGET

Matt Miller puts it in perspective:

. . . The crucial thing to understand about Ryan is that he is not a fiscal conservative. He’s a small-government conservative. These are very different things. The fastest-growing federal program in Ryan’s new budget is interest on the debt, which nearly triples from $234 billion next year to $614 billion in 2022. He doesn’t even pretend to balance the budget until 2040, and then only under utterly dubious assumptions.

These are not the choices a fiscal conservative makes. A fiscal conservative pays for the government he wants. Ryan wants government smaller than the one Reagan led even as America ages, and he doesn’t want to pay for it. Instead he adds trillions in new debt and makes no bones about it. . . .