Headlines

Pelosi downplays threat to withhold impeachment articles from Senate

S&P rises to another record as investors shake off impeachment, hits 3,200

Reporters caught celebrating [impeachment]?

Pope Francis has migrant crucifix installed in Vatican

Democrats stockpile cash for state-by-state redistricting fight

Housing supply hits record low, igniting prices

Schiff claims that Trump made ‘veiled threat’ to him ...

Clyburn: I would delay transmitting articles ‘as long as it takes’

Putin says Trump won’t be removed on ‘trumped-up charges’

Investors bet on a Clinton-like rally with stocks up 7% since impeachment inquiry began

Senate trial in doubt ... McConnell threatens to cancel

Mitch McConnell: Pelosi ‘to afraid’ to send impeachment articles to Senate

Paranoia

I'm not usually paranoid, but there was one moment when I fell into this psychotic pitfall.

Short story:

Almost twenty years ago I had started a data analysis software company, Occam Research, and had attracted a number of big-bucks investors. However, to protect themselves, these investors insisted that the company take out a multi-million dollar insurance policy on my life. Like most start-ups the company eventually ran into cash-flow problems causing me considerable heartburn. And, in the back of my mind, I often thought that my passing might solve the company's problems ... and had a few paranoid thoughts that others might have these secret thoughts.

A short time later, while driving to work following my standard route, I experienced a strange happenstance -- a huge limb fell off a tree just about ten feet in front of my car ... a limb, had it hit my car might have sent me to my maker. I drove around this fallen limb and to work. But, the more I thought about this close call, the more I worried that my paranoia might be of substance. So I drove back to the location of this fallen limb to see if anything was suspicious ... saw marks, etc.

But, by the time I got back there, the limb had been removed by the DPW ... so, alas, I will never know if my paranoia was justified.

Free Ride

The initial public offering (IPO) of Alibaba Group Ltd. (BABA), the huge Chinese Internet company, has made quite a few investors quite a bit of money ... and I don't even mean the venture capitalists and other initial and mezzanine investors like Yahoo. I mean those people and companies who were allocated stock in the initial distribution this morning at $68 per share. They then had opportunities to sell this stock for as much as $99.70 per share after the stock started trading about noon today at $92.70. During my days on Wall Street, selling an IPO during its first trading day used to be called a "free ride."

The size of this initial offering was 320.1 million shares and the total volume for this first trading day totaled over 271 million shares. This means that it is possible that many of those who received their shares on the original allocation had a opportunity to sell them for at least a $24.70 per share profit to as much as $31.70 per share profit ... meaning that those who were lucky enough to get these allocations were wealthier (on paper anyway) by at least $7.91 billion ... possibly more. Not bad! Basically all this wealth was just created out of thin air. One clever author call this IPO-created magical wealth, Supermoney ... see: Amazon Listing.

To me, this suggests that all this monetary gas may keep the stock market inflated for a while yet. To read more about this IPO and Alibaba itself read: Marketwatch Writeup.

Afterthought: Thinking about this IPO further, I may have stumbled upon the fundamental advantage of capitalism ... super wealth creation. Such things just don't happen under those economies of the commonwealth variety. Perhaps that is why the U.S. keeps winning despite all our screw-ups?