WSJ: Whoops!

We all make mistakes. Forgot to fill up the tank with $2 gas. Sold Google at $250. But that’s nothing compared to the whoppers the captain of industry committed. Here are some beauts:

Dilution: Founders always have problems letting go. A few years back, with their stock at $40, Calpine’s Peter Cartwright refused to have the power generation company sell shares to raise capital, instead taking on some $17 billion in debt. “Executives didn’t want the dilution that would result from stock issues,” wrote this paper. Oops. Natural gas prices tripled and Calpine lost $684 million so far this year and can’t pay interest on its debt. Bankruptcy looms, Cartwright is gone and the stock is 20 cents. Now that’s dilution.

Too early: It’s no secret that movie and casino mogul Kirk Kerkorian wants a board seat at General Motors. ‘Why’ is one of life’s mysteries. He hired former Chrysler CFO Jerry York, and in April, the two of them concocted a bizarre strategy, they bid $868 million for 28 million shares. That’s $31 a pop. Were they attracted to the 6% dividend? What was the rush? Kirk now owns 9.9% of the company and with the stock deflating like a flat tire and now $22, he should have stuck to craps in Vegas.

He should have stuck to craps in Vegas

Too lazy: With General Motors in a world of hurt, and Chrysler in high priced German hands, you’d think that Ford would be taking a victory lap. Nope. Ford North America is $2 billion in the red in nine months. William Clay Ford Jr. took over four years ago and that ‘any color, so long as it’s black’ customer focus must be endemic to that gene pool. Toyota can’t keep up selling hybrids, while Bill is closing factories. Believe it or not, I converted a Mazda Miata into an electric car in my garage with just a socket wrench and hacksaw - it can’t be that hard. The Ford family owned Detroit Lions are 27th in the NFL in offense. Nuff said.

No Strategy: It would seem that Brian Roberts, the CEO of Comcast, has got everything. A lock on 21 million cable subscribers, prices going up more than inflation, booming cable modems, voice over IP, video on demand - yet his stock is down this year. After Disney turned down his overture last year, investors figured out that Comcast is just wires with no leverage and that in reality, he’s got nothin’. Well, except $22 billion in debt and almost no cash (see Calpine) and threats from telcos and wireless and no strategy to deal with it except to buy more cable companies.

Too late: In-home shrines to Warren Buffett now outnumber Elvis alters. Which makes the Oracle of Omaha’s very public bet against the dollar going into this year even more painful for his copycats. Berkshire put on $21 billion in contracts with a value of $1.8 billion and cited “deep-rooted structural problems” and the need for changes in trade policy and dollar declines. With the dollar up 16% against the euro and yen, that investment was down $897 million as of October. So was his stock through August until he was bailed out by three sisters – Katrina, Rita and Wilma, which popped insurance rates. I wonder if he can repeat that little trick next year.

Mr. Kessler is the author of “Running Money” (HarperCollins, 2004).