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alstry (< 20)




March 19, 2008 – Comments (2)

LONDON (MarketWatch) -- Carlyle Capital,  the bond fund affiliated with private equity firm The Carlyle Group, said Wednesday that its liquidators have found the fund's "substantial liabilities" are likely to exceed its assets and it's therefore considered insolvent.

Bear Stearns, shortly after giving their executives Billions in bonuses, gets taken over for effectively nothing shortly after giving the executives millions and millions in bonuses.

The funny thing is that analysts keep talking about earnings.  Earnings may not matter when you are insolvent.....especially when you are not being candid with the fair market value of the assets of a business.

America is facing the biggest asset value contraction in history.  The value of houses.  The value of commercial real estate.  The value of municipal bonds.  The value of corporate debt.  The value of just about anything we own or invest save commodities is declining in some cases declining a lot.

Many of those assets are supported by debt.  Much of that debt is seated in our financial institutions.  As the debt defaults, so does the integrity of the financial system.  At this point, debt is deteriorating so rapidly that no one knows what anything is worth.  Our financial institutions are leveraged 5 to 1 or 10 to 1.  The FED is throwing money at the system but little seems to be escaping into the economy.  Fear has grown so high that the yield on a 30 day treasury is less than .20 percent.

As debt continues to default who is next to be insolvent?  What sacrifices will be be asked to make?


2 Comments – Post Your Own

#1) On March 19, 2008 at 10:56 AM, mickeyc21 (29.70) wrote:

Carlyle Group is known as the ex-presidents club. Check out the list below (sourced from Wikipedia) of their owners and affiliates. If people of this caliber can't keep their ship upright do you think the rest have a chance?

Notable current and former employees and affiliated persons

[edit] Business G. Allen Andreas - Chairman of the Archer Daniels Midland CompanyDaniel Akerson - company directorJoaquin Avila - investment bankerLaurent Beaudoin - CEO of Bombardier (1979-)Paul Desmarais - Chairman of the Power Corporation of CanadaArthur Levitt - former Chairman of the U.S. Securities and Exchange CommissionKarl Otto Pöhl - former President of the BundesbankOlivier Sarkozy (half-brother of Nicolas Sarkozy, President of France) - co-head and managing director of its recently launched global financial services division, since March 2008 [23].

[edit] Political figures

[edit] North America George H. W. Bush, former U.S. President, Senior Advisor to the Carlyle Asia Advisory Board from April 1998 to October 2003.George W. Bush, current U.S. President. Was appointed in 1990 to the Board of Directors of one of Carlyle's first acquisitions, an airline food business called Caterair, which Carlyle eventually sold at a loss. Bush left the board in 1992 to run for Governor of Texas.James Baker III, former United States Secretary of State under George H. W. Bush, Staff member under Ronald Reagan and George W. Bush, Carlyle Senior Counselor, served in this capacity from 1993 to 2005.Frank C. Carlucci, former United States Secretary of Defense from 1987 to 1989; Also, former Princeton wrestling partner of former US Secretary of Defense, Donald Rumsfeld. Carlyle Chairman and Chairman Emeritus from 1989 to 2005.Richard Darman, former Director of the U.S. Office of Management and Budget under George H. W. Bush, Senior Advisor and Managing Director of The Carlyle Group from 1993 to the presentRandal K. Quarles, former Under Secretary of the U.S. Treasury under President George W. Bush, now a Carlyle managing directorAllan Gotlieb, Canadian ambassador to the United States (1981-89) and member of Carlyle's Canadian advisory board.William Kennard, Chairman of the U.S. Federal Communications Commission (FCC) under President Bill Clinton, Carlyle's Managing Director in the Telecommunications & Media Group from 2001 to the present.Arthur Levitt, Chairman of the U.S. Securities and Exchange Commission (SEC) under President Bill Clinton, Carlyle Senior Advisor from 2001 to the presentMack McLarty, White House Chief of Staff under President Bill Clinton, President of Kissinger McLarty Associates, Carlyle Senior Advisor from 2003 to the presentDan Senor - political consultantPeter Lougheed - Premier of Alberta (1971-85)Luis Téllez Kuenzler, Mexican economist, current Secretary of Communications and Transportation under the Felipe Calderón administration and former Secretary of Energy under the Zedillo administration.Frank McKenna, Canadian ambassador to the United States and former member of Carlyle's Canadian advisory board

[edit] Europe John Major, former British Prime Minister, Chairman, Carlyle Europe from 2002 until 2005

[edit] Asia Liu Hong-Ru, former chairman of China's Securities Regulatory CommissionAnand Panyarachun, former Prime Minister of Thailand (twice), former member of the Carlyle Asia Advisory Board until the board was disbanded in 2004Fidel V. Ramos, former president of the Philippines, Carlyle Asia Advisor Board Member until the board was disbanded in 2004Thaksin Shinawatra, deposed Prime Minister of Thailand, former member of board, who resigned on taking office in 2001

[edit] Media Norman Pearlstine - editor-in-chief of Time magazine from (1995-2005) Report this comment
#2) On March 19, 2008 at 12:26 PM, BroadwayDan (98.04) wrote:

Hey Guys,

Well, this is sure getting intense.   FWIW,  Alstry - I couldn't tell which text was your writing vs. the article's.  Here's a hyper link to the article noted above.  I don't mean to criticize, just to make it clear to which are your thoughts as this is all hitting the fan pretty hard.  Thanks for posting!



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