The view from the doghouse ain’t pretty. A Pontiac Aztec in the drive, a folded New York Times on the foreclosed neighbour’s roof. Who could have predicted a portfolio built on the pillars of U.S. capitalism – General Motors, Lehman, AIG, Kodak – could carry the scent of near-Armageddon? Whether you were seeking portfolio safety or stardom, they tossed you a bone …
Celestica (-88%)
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This IBM offspring started the decade as a market darling – until we found out that it was floating on a tenuous tech bubble built on wild fantasies, mad money and fairy dust. Thus Celestica CLS-T fell back to Earth – and then started burrowing. A decade of questionable acquisitions, overseas stumbles, management changes and endless restructurings have gotten the company absolutely nowhere. Celestica hasn’t turned an annual profit since 2000. Revenues have declined in each of the past three years. Maybe IBM should have used birth control. D.P. |
Lehman Brothers (Delisted after filing for bankruptcy protection Sept. 15, 2008)
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Gotta hand it to the boys at Lehman, they think big. Why stop at being a miserable investment, when you can also be the trigger for financial market near-Armageddon? Lehman’s creative hyper-use of risky credit derivatives kept its shareholders in the pink and its trading executives in private jets, until it all collapsed like a house of cards. The debt troubles mounted, the bear raiders smelled blood, the stock fell into oblivion, and Lehman was forced into bankruptcy – instantly becoming the catalyst for a near-disastrous credit crisis. We’ll be paying for Lehman’s mistakes for years. D.P. |
New York Times (-75%)
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Back in my day, young feller, we used to have these things called newspapers (like the New York Times NYT-N). See, they’d print stories on paper, and a fresh-faced kid in a ball cap would deliver one to your doorstep, and you’d actually like it that way, and you’d pay for it. Then one day, this thing called the Internet came along, and everyone started posting news stories for free, and even the good newspapers started losing their audience and their advertisers and just generally bleeding red ink, and ... Hey! Stop tweetin’ to your iPhone Facebook Google buddies! I’m talkin’ to you! D.P. |
Canfor (-39%)
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When people say that Canada hasn’t suffered from the residential real estate bust, they mustn’t be talking about the people who work in sawmills. The collapse of the U.S. housing market sent new-home construction into a nosedive, and the price of lumber fell to less than a third of its mid-decade peak. As if things weren’t bad enough, the surging Canadian dollar chopped into exports even further. Canfor CFP-T, Canada’s biggest lumber producer, comes out of the decade looking like it’s been through a wood chipper. D.P. |
AIG (-98%)
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If you look up “moral hazard” in the dictionary, you’ll probably find AIG’s AIG-N corporate logo next to it. The company, already stung by an accounting scandal earlier in the decade, went from massive global insurance conglomerate to massive welfare parasite. It messed up so badly in the credit derivatives market that it needed more than $180-billion (U.S.) in taxpayers’ bailout money to stay afloat. All the while, its former CEO was fighting fraud allegations and its executives were struggling to explain why they were still rewarding themselves millions in salaries and bonuses. D.P. |
