Doomsday Scenario: Bankers sue bankers, MSFT's Netbooks folly

Posted Mar 5th 2009 5:00PM by Alex Salkever
Filed under: Bad News, Microsoft (MSFT), Intel (INTC), Oracle Corp (ORCL), Stocks to Sell, Recession, Financial Crisis

Investment bankers are suing their employer for millions in unpaid bonus commitments. Apparently, they did not get the memo on the economy. Meanwhile, here's why Netbooks are perfect for this recession. Too bad it means dark times for Intel Corporation (NASDAQ: INTC) and Microsoft Corporation (NASDAQ: MSFT).

Sentiment on Intel and Microsoft is somewhat negative. Oracle Corporation (NASDAQ: ORCL) is reporting later today and whisper sentiment is not good. When database sales crash, so goes enterprise software.

Bloomberg picked up on the "negative basis" trade and the new Wall Street reality caused by the CDS mess -- many bondholders actually want to run companies into Chapter 11 in order to collect the CDS. The trade is basically flawed, however, in that it assumes that CDS holders will/can actually fulfill obligations on these quasi-insurance like pieces of paper. Note to negative basis traders -- enough of you tee this up, and the CDS market goes belly up.

Alex Salkever is the Director of Research at Piqqem.com, a stock prediction community that leverages the Wisdom of Crowds to make better stock and sentiment predictions.

Tags: CDS, data base, enterprise software, EnterpriseSoftware, hedge funds, intc, msft, negative basis trade, NegativeBasisTrade, orcl, technology