Good: I'm getting the opportunity to buy quality companies and cheap-long term prices. Recent buys include Proctor and Gamble (PG - $63.38), Pepsi (PEP - $64.55), Coca Cola (KO - $51.00), General Electric (GE - $27.10) and United Technologies (UTX - $60.38)
Bad: My bet on oil stocks isn't paying off the way I had hoped in this rising oil market.
Vikram Pandit Makes Rock Star Status Written By: David Neubert 2007-12-12 15:50:58 Together with Madonna, Sting and Prince, Vikram Pandit, my old boss at Morgan Stanley, has acheived rock star status. He's the only CEO I know of in the world who is referred to only by his first name.
I've been seeing a lot on CNBC and other media dissing the Citigroup Board for choosing Vikram Pandit as its (C - $31.53) CEO. I used to work quite closely with Vikram at Morgan Stanley and I found him to be a thoughtful, insightful, extremely level-headed and intelligent manager. He's one of the few managers I ever had who would understand every screw-ball idea I would throw at him. And believe me, I would dream up a lot of crazy derivative products.
He has a conservative management style and considers every angle of a decision before moving forward. I could almost see him going through his checklist on every decision, Profit Potential, Legal, Employee Morale, Reputation Risk, Credit Risk, Shareholders, Credit Rating, Sovereign Risk. I can see him thinking the same way going forward at Citigroup. Virkam was head of the Equity Division as we openned our Brazil office. He aksed good questions, but unlike several other divisions at Morgan Stanley, was not so risk averse that we walked away from the potential.
So, I'm hanging on to my Citigroup. If you've been watching my Citigroup stock purchases you know that I'm underwater on the position. But I think the market's harsh treatment of Vikram right now is a symptom of a "beat up Citigroup" crowd mentality.
In fact, if Microsoft really wanted to play hard ball at this point they could simply give Yahoo 48 hours to accept the terms or pull the offer off of the table. With the offer off of the table Yahoo stock would immediately drop. The lawsuits would take place driving the stock down further and if Microsoft just waited 6 months or so they might be able to end up buying the stock in the end for somewhere around $8 a share.
When Adam Smith wrote about the "invisible hand" in 1776, he referred to the natural forces that allow the market to correct for seemingly disastrous situations with no intervention on the part of government. Unfortunately, the natural forces of the market are no longer relevant. Wall Street's ecosystem has been polluted by a flawed broker-dealer model, leveraged complexity and a lack of proper oversight.
