Stick a fork in ‘em, Lenny’s done.  The former pro ball player turned self proclaimed Wall Street guru Lenny Dykstra is flat out of money.  Broke.  Penniless.

His 6 bedroom, 7 bath California mansion is up on the auction block, and the New York Times suggests that this is just the tip of the iceberg.  Dykstra’s Gulfstream II has been repo’d after the former infielder failed to pay a $228k bill for a new interior and electronic cabin entertainment system.

What’s ironic about all this is that Dykstra’s been touting his “gains” for the last several years on TheStreet.com and other financial blogs.  In fact, after reading his articles, you’d think Dykstra was the only one making money in the market over the last 12 months.

Countless pundits, Jim Cramer among them, have noted how dead-on accurate Lenny Dykstra’s been with his deep-in-the-money calls. One reason, says Cramer, “Lenny brings the same intensity, skill and aggressiveness to options trading as he did to baseball. Lenny is rapidly becoming one of the great ones.” -Source

What’s amazing is that Dykstra is still giving investment advice, for a price, on TheStreet.com.

For a mere $995 per year, you can get Lenny to tell you how to go broke, just like he did!

Of course, if you’re a pro athlete worried about your financial life after sports, Lenny can show you how to manage your money, just like he does through his Players Club Magazine.

Just goes to show, be careful who you take investment advice from.

Finance, Investing bankruptcy, investment advice, Lenny Dykstra

Wagoner’s out at GM, essentially pushed out by the Obama administration without consult from the rest of the policy makers in Washington (i.e. Congress) as a condition of new government loans.

This serves as nothing more than strengthened evidence of how screwed up our government really is.  At no point in history has a CEO ever been forced to leave through direct consult of the President of the United States.  A company board of directors reigns supreme over the function of the company, and last I checked no one from the Obama administration sits on the GM board of directors.

This is not how capitalism works.  This is not how free markets work.  This is not how a publicly traded company works.

If the Obama administration wanted authoritative power over who holds what position in a company, they should have bought stock and run the CEO and the board of directors straight out of Detroit.  Instead, the government gave the company a loan, which at last check, does not come with any voting rights.

To be sure, Wagoner needed to leave. His leadership was and has been ineffective for the last 5 years with no forward thinking and a complete lack of influence from the corner office.  But to be run out of town by the Government is preposterous.

The punchline to all this came from the joker himself:  “The government does not wish to run an auto company.”

Furthermore, if bankruptcy is an option, as Mr. Obama now states, then why did all that taxpayer money get dumped into the company in the first place?

The next joke will come at the conclusion of the bankruptcy hearings; as repayment of taxpayer money will be forgiven as debt is erased and creditors are shooed away.  All in the name of a stronger and healthier General Motors.

Meanwhile, Ford hasn’t taken a dime.

Business, Finance, Politics bankruptcy, GM, Rick Wagoner

Last week’s issue of Business Week contains an interview article by Maria Bartiromo with global investor Jim Rogers.  The bulk of the article is on Rogers’ view of the current economic health and the fidelity of the economic policy from the Obama administration.

Reading the article, it was almost as if Rogers was reading my mind.  A few excerpts from the article, but I’d encourage you to read the entire thing here.

Bartiromo: So what should they be doing?

Jim Rogers: What would I like to see happen? I’d like to see them let these people go bankrupt, let the bankrupt go bankrupt, stop bailing them out. There are plenty of banks in America that saw this coming, that kept their powder dry and have been waiting for the opportunity to go in and take over the assets of the incompetent. Likewise, many, many homeowners didn’t go out and buy five homes with no income. Many homeowners have been waiting for this, and now all of a sudden the government is saying: “Well, too bad for you. We don’t care if you did it right or not, we’re going to bail out the 100,000 or 200,000 who did it wrong.” I mean, this is outrageous economics, and it’s terrible morality. -Source

I agree.  It’s as though in this day in age the term “bankruptcy” is a death sentence.  The fact is, bankruptcy should be looked at as a tool to restructure a company to regain a healthy business plan and achieve profitability.  The airline industry has been a friend to Chapter 11 for decades, and airlines have been healthier for it; not to say airlines are well run, just that they take advantage of a system put in place to deal with corporate shortcomings.

Rogers doesn’t stop with the financial sector, either.  He advocates his “let them go bankrupt” mindset across the board:

Bartiromo: What about Citigroup? What about the car companies?

Rogers: They should be allowed to go bankrupt. Why should American taxpayers put up billions to save a few car companies? They made the mistakes! We didn’t make the mistakes! I’m sure they’ll give them the money, but I’m telling you, it’s a mistake. It’s a horrible mistake. -Source

The real beauty of capitalism is that it allows people and businesses achieve great success, but only because it also allows them to fail.

There seems to be this wide-spread notion today that everyone deserves success, and everything should be “fair”; that there needs to be a level playing field all across the board, and no one person or entity should have an advantage over another.  If this continues, our capitalistic society will itself, fail.

Below is an interview with Jim Rogers on Glenn Beck’s radio show.  His overall outlook on the U.S. economy is pretty grim, and may even be extreme to a point, however I don’t think he’s too far off.

An especially good quote from his radio interview: “If you look to Obama and the government for investing advice, you will go bankrupt.”

Economics, Finance bankruptcy, capitalism, Economics, Jim Rogers