Cerebus, The Hell Hound Hedge Fund

Elaine Meinel Supkis

Today's evil hedge fund is Cerberus. Like the Pirate Fund or Fortress, this group named itself after something evil. They can't help but advertise who they are. Cerberus is the Hound of Hell, the three headed beast. Why haven't any hedge funds named themselves 'Whore of Babylon'?

From CNN Money:

By Katie Benner, Fortune reporter

Few private equity shops walk as softly or carry as big a stick as Cerberus, the most under-the-radar of all buyout kings. There are no multi-million dollar birthday parties for founder Steven Feinberg, the former U.S. Army paratrooper who prefers Budweiser to fine wine. The upper floors of the firm's Park Avenue offices are spartan, unadorned warrens of cubicles where some of the best minds in business pore over deals and run numbers. And without flash or ado, Cerberus has quietly bested bigger rivals for deals, snatching GMAC from KKR and Albertson's from Thomas H. Lee Partners.

But the company may not be able to avoid scrutiny much longer. Newspapers in Germany and Detroit have reported that Cerberus has put in a bid for Chrysler, worth as much as $9 billion. A Cerberus spokesman would not comment on the company's larger plans in the auto space, and Chrysler has not confirmed the report.

So, the dogs of Hell are going to take over more and more parts of the auto industry? General Motors isn't about building good cars, it is about the stupid, noxious carry-trade/loans for Americans business that is killing our industrial base and destroying our country's future.

In the past, whenever I visit a hedge fund web page, I find stuff that is pitiful. Nearly all of them are 'under construction' and anyone who can't run a stupid web page can't run a company. I seriously wonder why one of these clowns doesn't give me a ring and pay me to build and run a nifty web page. Heck.

So here is Cerebus' wimpy web page.

Before I clicked on their menu, I said to my dear husband, 'I bet the page has no information and is under construction.' And voila! Bingo.

The reason I knew what it would look like aside from being a most excellent psychic is, this is how ALL the hedge fund web sites work! None have any information at all and they all claim they can't hire some geeky high school kid who hangs out at My Space to fix them up a working web site! Seriously. Anyone who tells the world, they are multi-billionaires and then have the equvilent of a fishing shack as a corporate web site should be laughed out of the business.

But of course, these are Pirates as one hedge fund proudly named itself. In this case, being worshippers of the Devil that is Death, Plutonian dwellers in Hades, demons of hell, they named their company after their mascot. Hell Hounds indeed.

From the Wall Street Jounal:

General Motors Corp.'s Chevrolet Aveo is a perky little subcompact rated at 37 miles per gallon on the highway in the Environmental Protection Agency's tests.

In the U.S., GM dealers are selling Aveo LS hatchbacks, which have a sticker price of $12,425, for roughly $10,600 after a $1,500 rebate, according to car shopping site Edmunds.com. In Germany, however, GM sells a version of the Aveo with a smaller engine at a starting price of €13,690 -- nearly $17,800.

GM doesn't disclose the profit or loss it recognizes on each model line. But given that GM effectively broke even in its North American auto operations during the fourth quarter of 2006 on an average per-vehicle revenue of $20,779, it's a reasonable guess that a car selling for $10,600 doesn't do much for the company's bottom line.

Yaaaassss. Selling cars absolutely sucks. No massive profit margins. Now, handing out loans at 8.50% to slackers who have no intention of paying off the loans, that is real money. And the Japanese who are destroying our auto industry want Cerebus to turn the last of our industries into a machine for processing Japanese yen/dollar weirdnesses which allows the Japanese to penetrate and dissect our native industries.

And of course, thanks to the fake yen's value, the Japanese can undercut American automakers in competition for smaller cars! Whoo hoo. And so it goes: down the tubes. Devil take the hindmost and the Hell Hounds will grind up our bones. And of course, they will increase their profit margin by ending unions here and shipping more factories to China.

But there is a fly in this hellish stew!

Oops. Despite heroic efforts of the Japanese Liberal Party and our ruling elites and the Hedge Fund Hell Hounds (where is Sherlock Holmes????) the yen is getting stronger and stronger and so of course, the Nikkei drops like Rocky Balboa in reality if he ever boxed a real dude from the hood.

Yes, like India, Japan's stock market is tanking a tad. Ours went up a tiny, itsy bit. But the general trend is downwards. I noted all the media was screaming that all was well so the blue chippers were quite chipper.

From Bloomberg:

The U.S. economy is slowing. Mortgage defaults are rising. And stocks are the cheapest in 20 years, a ``buy'' signal for some of the world's biggest money managers.

BlackRock Inc., Fisher Investments Inc. and Schroders Plc, which manage about $1.4 trillion, say stocks are inexpensive relative to bonds. Profit of companies in the Standard & Poor's 500 Index, the benchmark for American equity, is growing faster than shares, and represents a yield of 6.53 percent compared with 4.65 percent for 10-year U.S. Treasury notes.

The gap -- the widest since 1986, according to data compiled by Bloomberg -- is encouraging investors because earnings forecasts indicate the U.S. will keep growing, while bond yields show confidence that inflation will stay in check.

``I'm on the wildly optimistic side of things,'' said Kenneth Fisher, who oversees about $38 billion as chairman of Fisher Investments in Woodside, California. ``The economy is stronger than people think it is.''

Wildly optimistic and even more irresponsible. Rather than give his readers real advice, he cheer leads them. Booolah. Go, team. And of course, this does egg the last of the believers to pray at the Gates of Hell and hope for the best. But uniformly, the news is bad! The fact that a gang of Hellish Puppy Dogs are buying the last of our industries, a pack of pooches who can't run a stupid, itsy bity web site that is only six pages in size???

My home base is twelve levels and I have hundreds of pages, hundreds! And I didn't take over any companies to do this! Why on earth...how dare they? How dare our media cover these obvious con artists as if they are real businesses???? Arrrrooooooo! Bark, bark, bark.

No wonder the Persian Kitty in Iran is taking us all to the cleaners. And baby dragon goes boom to his heart's content.

Bloomberg again:

New Century Financial Corp., overwhelmed by rising defaults from borrowers with poor credit records, became the largest subprime mortgage lender ever to fail as it filed for bankruptcy today.

New Century plans to sell most of its assets within 45 days, said the Chapter 11 filing in federal court in Wilmington, Delaware. About 3,200 people, more than half the workforce at the Irvine, California-based company, will be fired. New Century said it already agreed to sell its mortgage billing and collections unit to Carrington Capital Management LLC for $139 million.

Oh, so the Hell puppies are going to be better than the second biggest mortgage company? Hahaha. We knew they would go belly up and if anyone imagines this is the end, to paraphrase Churchill: this isn't the beginning of the end, it isn't even the end of the beginning, this is hell.

From PRN News:

SANTA MONICA, Calif., April 2 /PRNewswire-FirstCall/ -- Fremont General Corporation (the "Company") (NYSE: FMT - News), doing business primarily through its wholly-owned industrial bank, Fremont Investment & Loan, today announced that Grant Thornton LLP ("Grant Thornton") has advised the Company that Grant Thornton is resigning from its position as the Company's independent registered public accounting firm. Since Grant Thornton's engagement by the Company in August 2006, there has not been any disagreement between the Company and Grant Thornton on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreement, if not resolved to the satisfaction of Grant Thornton, would have caused Grant Thornton to make reference to the subject matter of the disagreement in connection with its audit report. The Company today filed a Current Report on Form 8-K disclosing Grant Thornton's resignation.

Oops. Here is another big shot getting shot in the ass. They hired an accounting firm to fix their books that were cooked as if Martha Steward was in charge of their kitchen and they are in just as much trouble as she was with the federal investigators and now that accounting firm is quitting because they found the joint in such a mess, everything was either burned or ripped off or rotten or stink to high heaven.

Whatever. This is actually horribly amusing. I went to their web page and it looked like they hired at least three geeks to run the place because it wasn't under construction. Congratulations. But it is still whacked.

Here aer facts about the guy running this scam artistic organization:

James A. McIntyre is the Chairman of the Board of Fremont General Corporation, a Santa Monica based holding company, listed on the New York Stock Exchange. Fremont General is engaged through subsidiaries in financial service businesses nationwide, primarily through its wholly-owned industrial bank subsidiary, Fremont Investment & Loan, a nationwide residential and commercial real estate lender. Mr. McIntyre began his career with Fremont as Secretary-Treasurer for Fremont Indemnity Company (FIC) in 1963, and was later elected as President in 1968. He resigned as President of FIC in 1978 to devote full time to activities of the parent organization, Fremont General Corporation. In 1976, Mr. McIntyre was elected Chief Executive Officer of Fremont General, and was elected Chairman of the Board in 1989. Mr. McIntyre resigned as Chief Executive Officer of Fremont General in 2004. He remains Chairman of the Board.

Mr. McIntyre graduated from the University of Southern California in 1954 and was licensed as a Certified Public Accountant in 1956. Before starting his career at Fremont, he worked for the national accounting firm, Ernst & Ernst (now Ernst & Young) and was self-employed as a CPA. Mr. McIntyre is a past member of the Young Presidents Organization (YPO). He is currently an active member of the World Presidents Organization (WPO) and the Chief Executives Organization (CEO), as well as various civic and charitable institutions.

So, this old coot who was counting coins when I was learning how to count fingers, is in the Young President's Organization? Who is in the old President's organization? Methudzela? And he is an accountant? Oh, to see how he screwed up would be most interesting. I'm certain some investigators in the Fed might put 2+2 and find out it doesn't add up to $568 million.

In fact, from 2004 to 2005, their value has dropped from $602 to $549 million. They are so proud of themselves, they won't say what they lost last year. I do see their stock is tanking on the news and it is already in the realm of penny stocks as it is.

Penny stocks often end up penniless stocks when companies bankrupt themselves. And this outfit is heading into them thar hills.

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Comments

[Big Al]

The US government has dibs on "The Whore of Babylon" out there in Iraq.

[Elaine Meinel Supkis]

I thought it was the Bleeding Stumps Of Babylon'?

[cha]

€13,690 is with tax. I have seen a aveo for around €10.100 without tax.

[Elaine Meinel Supkis]

They sold me mine for just $10,000 with tax. Which means, compared to the ones sold for euros, I got for $3000 less! And there, the difference between dollar and euro. lies the 'profits' Detroit is whining about.

[cha]

But $10.000 was a special deal because the US auto-market is going great. $12.500 is the same as €10.000 when you use a $/€ rate of 1.25 And that is the rate which one would have used a year ago.