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8:30 AM EST, Tuesday, March 13, 2007: I'm still in Hilton Head. The weather is stunning. The tennis is even better. Today two of my loans to western real estate developers paid off -- in cash -- with interest. If I sound a little surprised, you're right. There are serious advantages:

+ to having a first trust deed over the property you're lending on. That's like having a first mortgage.

+ to having a personal guarantee from a well-heeled developer with a serious reputation to preserve. (Going broke doesn't help.)

+ to having a developer with sufficient of his own money in the project ("skin in the game") that he'll do everything -- including moving mountains -- NOT to lose his dream property to undeserving lenders like me.

Having security over your investment has major pluses. That's why some investors prefer a "convertible" instrument. If things go awry, they get the company's assets. If things go well, they convert to equity and enjoy those rewards.

Cockroach stocks. You can smell 'em a mile off. They start with a piece of unusual, out-of-the ordinary news -- , a dumb management screw-up, backdated options, an SEC request for information and then things only get worse and worse. The stock starts to dive and then dives some more. The latest cockroach stocks are those who loaned to subprime borrowers. Funny thing, these idiots are still around. On Hilton Head TV yesterday, there was an ad to lend you up to "150% of the value of your home." What idiot company would do that in today's real estate market? Defying common sense is a common trait among Wall Street analysts. From the New York Times:

On March 1, a Wall Street analyst at Bear Stearns wrote an upbeat report on a company that specializes in making mortgages to cash-poor home buyers. The company, New Century Financial, had already disclosed that a growing number of borrowers were defaulting, and its stock, at around $15, had lost half its value in three weeks.

What happened next seems all too familiar to investors who bought technology stocks in 2000 at the breathless urging of Wall Street analysts. Last week, New Century said it would stop making loans and needed emergency financing to survive. The stock collapsed to $3.21.

The analyst’s untimely call, coupled with a failure among other Wall Street institutions to identify problems in the home mortgage market, isn’t the only familiar ring to investors who watched the technology stock bubble burst precisely seven years ago.

Now, as then, Wall Street firms and entrepreneurs made fortunes issuing questionable securities, in this case pools of home loans taken out by risky borrowers. Now, as then, bullish stock and credit analysts for some of those same Wall Street firms, which profited in the underwriting and rating of those investments, lulled investors with upbeat pronouncements even as loan defaults ballooned. Now, as then, regulators stood by as the mania churned, fed by lax standards and anything-goes lending.

"Tech Companies Bleeding Red Ink Pursue IPO Gold" says today's headline in the Wall Street Journal. Be wary of buying into companies with no profits. The time to get into these companies was long before the IPO. By the time of the IPO, everyone who got in earlier is looking to cash out -- immediately, ASAP, if not sooner. Here's the Journal's chart. To read the article, Click here.

Under "You can sell anything." Neiman Marcus is selling a pair of jeans for $485, which is "dry clean only." I find this amusing. For your very own pair, click here.

Tennis on TV this week starts on Wednesday. Actually it's started earlier on The Tennis Channel. (A reader pointed out my omission). And it's on today again on The Tennis Channel, starting at 3:56 PM EST. For most of us, The Tennis Channel costs extra. Tomorrow, the Pacific Life Open (also known as Indian Wells) switches to ESPN2, which is usually part of basic cable.

Rodney Dangerfield's best one-liners
+ My wife only has sex with me for a purpose. She uses me to time an egg.

+ Last night my wife met me at the front door. She was wearing a sexy negligee. The only trouble was that she was coming home.

+ A girl phoned me and said, "Come on over. There's nobody home."
I went over. Nobody was home!

+ A hooker once told me she had a terrible headache.

+ I was making love to this girl and she started crying. I said, "Are you going to hate yourself in the morning?"
She said, "No, I hate myself now."

+ I knew a girl so ugly, they use her in prisons to cure sex offenders.

+ My wife is such a bad cook that if we leave dental floss in the kitchen, the roaches hang themselves.

+ The other day I came home and a guy was jogging naked in front of my house. I asked "Why?"
He said, "Because you came home early."

+ I know I'm not sexy. When I put my underwear on, I can hear the Fruit-of-the-Loom guys giggling.

+ My wife likes to talk on the phone during sex. Last night, she called me from Chicago.

This column is about my personal search for the perfect investment. I don't give investment advice. For that you have to be registered with regulatory authorities, which I am not. I am a reporter and an investor. I make my daily column -- Monday through Friday -- freely available for three reasons: Writing is good for sorting things out in my brain. Second, the column is research for a book I'm writing called "In Search of the Perfect Investment." Third, I encourage my readers to send me their ideas, concerns and experiences. That way we can all learn together. My email address is . You can't click on my email address. You have to re-type it . This protects me from software scanning the Internet for email addresses to spam. I have no role in choosing the Google ads. Thus I cannot endorse any, though some look mighty interesting. If you click on a link, Google may send me money. Please note I'm not suggesting you do. That money, if there is any, may help pay Claire's law school tuition. Read more about Google AdSense, click here and here.
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