Author Archives: nlo-admin

“..Our endorsement of repurchases is limited to those dictated by price/value relationships and does not extend to the ‘greenmail’ repurchase - a practice we find odious and repugnant. In these transactions, two parties achieve their personal ends by exploitation of an innocent and unconsulted third party. The players are: (1) the ‘shareholder’ extortionist who, even before the ink on his stock certificate dries, delivers his ‘yourmoney-or-your-life’ message to managers; (2) the corporate insiders who quickly seek peace at any price - as long as the price is paid by someone else; and (3) the shareholders whose money is used by (2) to make (1) go away. As the dust settles, the mugging, transient shareholder gives his speech on ‘free enterprise’, the muggee management gives its speech on ‘the best interests of the company’, and the innocent shareholder standing by mutely funds the payoff (Warren E. Buffett.  Letter to Shareholders.  February 25, 1985. page 3.).”

Robert Rodriguez’s stunning and prophetic April 2005 assessment of Fannie Mae, Freddie Mac, and AIG.