Well, my daughter came home from college for Spring break on Saturday, and the rain never showed, so we spent quite a bit of time out in the sun and brilliant blue sky, having a lovely weekend.
This afternoon I was walking along Hendry's beach, a little behind my family, watching my youngest daughter as she danced around near the low tide on the rocks, and I ran across this guy in a rather nice Italian suit sitting on the sand. He looked like he was crying, so I asked him what that matter was. He sat up and quickly dried his eyes, honking on his monogrammed handkerchief, and blubbered out something about being completely broke.
Well, as you know, my business is down on Milpas Street, just around the corner from the homeless shelter, so I'm pretty familiar with this sort of thing, so I asked him if he needed a couple of bucks for bus fare or a beer or something.
He sighed and said while he appreciated the gesture, his problems were much bigger that two or three, or even five dollars. His problems were in the millions---billions, probably---and, as he said, "when the shit hits the fan, there's gonna' be a whole lot of guys in natty suits crying in the sand."
Oooookay, I said, so how bad can this be?
Well, he said, he'd gone and got into a bit of a credit pinch. See, he and his partners had invested in some sort of shitpile, a group of assets, sight unseen, and now, like waking up next to someone you can't remember picking up at the bar last night after watching UCLA beat Stanford, the shitpile is beginning to really stink and there's no one willing to take it off their hands.
"But the debt...that's gotta' be worth something..." I trailed off.
"Yeah, the debt. Well the debt's still there, but the shitpile's worth a lot less than we can cover, and there's no money to pay on it. We're all screwed, every last one of us." He started crying again.
I asked him if there was anyway to sell his business, with the debt included.
He acknowledged that that was possible, but who would buy it? He'd been burning the lines and no one wanted it. At all.
"Does it include the building?"
"Yeah. Our beautiful building in New York. Along with the shitpile stinking up the basement, lobby, and fancy offices."
"Well, how much you want for it?"
He told me that the shareholders hadn't seen their share price lower than $20 in many years, but at this point they were willing to settle for $250 for the whole thing.
"Two hundred fifty million?"
He snorted. "That'd be nice. But nah, we'll never get that. We just want it out of our hands. Dump it, that's the ticket."
I reached into my beach shorts and pulled out my wallet. "I've got, um, $250 dollars cash here, how's that?"
He looked excited for a moment, then burst into tears again.
"Yeah, it's the best offer I've had all day. I'll take it."
He pulled out a sheath of papers, made a couple of phone calls, and we did the deal.
So that's how, by the time the rest of my family trailed back to where I was sitting on the sand, I bought Bear Stearns.
I figure, what the hell, I can turn the building into lofts. Have you seen the price of a nice loft in the City lately?