John Mauldin explains in easy to understand language why this bailout is required. In great detail he expands on my comment yesterday; I think $700 billion may look like a steal or a pipe dream in the months to come.
John discusses the size of the subprime problem “Over $500 billion has been written off so far, with credible estimates that there might be another $500 billion to go”
Remarkably that view is still in line with S&P’s April prediction I commented on a few days ago. -> Excellent prediction from …

Last Trade:
21.920 AUD

Trade Time:
10:53AM AEST

Change:
 1.230 (5.31%)

Buys 1000 shares of Westpac. The best capitalised bank coming in and the most likely to survive. I’ve been waiting to buy WBC as noted in an earlier post. Check the dividend history and pick a time that you think represents normalised earnings and timeframe to when earnings will hit new highs. 
I also realised I have only commented on my last purchase and never posted about it. 
Here is what I said
Fusion Investing Fund just bought AKAM for $17.36. 1000 shares.
Also placed a sell Put order for …

You Can’t Rescue the Financial System If You Can’t Read a Balance Sheet
This is a bad idea.
However the final legislation is written, the Troubled Assets Relief Program (TARP) being rushed through Congress will evidently be built around its single worst provision, which is that the Treasury will have authority to purchase distressed mortgage securities from U.S. financials.
… Buffett’s investment may reflect confidence in Goldman, particularly with a government backstop on whatever questionable assets it does own, but if anything, it suggests that the government should have gone the same …

I’ve finally found a good free wordpress magazine style theme, thanks to this great list of free magazine themes. So let the site upgrade to Arthemia Magazine style begin.
Arthemia combines “a magazine and a weblog into one; it is not too magazine-ish nor too blog-ish.” I like it ‘cos it displays a lot on the front page with a clean uncluttered design. On the downside is no clear RSS links for feed or email, though that should be easy to sort out,
It would be great to hear what you think …

Rather the wallow in the demise, woops I mean temporary stumble, of the US I thought it may be good to focus on some good numbers for a change. Fortunately I need look no further than my backyard and a topic dear to my heart, Australian superannuation (retirement) funds.

1st the place Australians hold in comparison to the rest of the world in our readiness for retirement due to our superannuation system.
ONE TRILLION approximately how much money Australians have in super [retirement] funds.
10 MILLION the number of Australian workers
$21,700 the amount …

$340 billion in delinquencies requires $700 billion bail-out. Will the wonders of accounting ever cease?
“Alt-A mortgage backed securities is smaller — about $US600 billion for loans made between 2005 and 2007, compared with about $US1000 billion for sub-prime.” London Financial Times reported in The Australian
Percentage of Loan defaults from NY Times

Form those two sources I conclude:

12%-27% of subprime in default or $120- $270 billion
6% - 12% of Alt-A are in default or $36 - $72 billion

Even if I take the highest numbers ($270B+$72B) I still get a $360B …

General Electric, GE, leads the way. I  like this writeup by Henry Blodgett.
My initial reaction, with GE futures down, is that this is a good opportunity to buy GE on tempoary weakness, though there is probably no need to rush. I continue to see the GE glass as half full. This is why I am investing. “Industrial earnings to remain strong in third quarter, up 10-15%, led by infrastructure businesses” and they say in the press release
In their press release GE state a lot, so you should probably just read …

Similarly, market bottoms are created because investors stop looking for a bottom, and extrapolate ongoing bad news. If you remember the lows of 1982, or 1990-1991, or 2002, you’ll recall that in each instance, the question among investors wasn’t whether the economy would recover in one quarter versus two quarters. The question was how the economy could recover at any point in the foreseeable future. Investors give up hope at bottoms.
Have you given up?
nah, me either. That should concern anyone on margin.

Akamai is due to report earnings between 30-Oct-08 and 9-Nov-08.
AKAM’s stock price has been  hammered in the last four months, down from over $40 to $17. The masses are sure that competition will eat the lunch of this established leader and are pricing AKAM as if growth will be negative going forward.

View the full AKAM chart at Wikinvest

Fundamental View
Cheap on all metrics. Watch for slowing in growth.

Lowest Price to free cash flow ever. FCF has increased every year since 2000.
Lowest Price to sales since 2002.
Slowing growth more than priced in.

Worst …

Can you get a deal like Warren? Yes, but be prepared to take more time and capital risk.