Lenny Dykstra, the ex-Phillie and Met who lost his Malibu mansion, pawned his World Series ring and declared bankruptcy after his business career went south earlier this year, is back promoting stock options after a couple months off. His Nails Investments Website here.

Dykstra's investor critics say his claim of a 100% success rate is unrealistic because it relies on treating options contracts as if they never expire. But Dykstra's still making the claim, and charging $1000/year for his options tips. But now he appears to have added a cheaper membership,  $125/month for short-term users. A recessionary discount?

ADD: Inquirer's Paul Nussbaum writes about latest DRPA building, maintenance and financial expense here.

EARLIER: "The Delaware River Port Authority, operator of four toll bridges and a commuter rail line between Philadelphia and southern New Jersey, today agreed to borrow as much as $585 million to manage an interest-rate swap that will cost $111 million to cancel," Bloomberg reported here last night. (Updated link)

"The derivative, agreed with the New York unit of Zurich- based UBS AG in 2001, takes effect Jan. 1 and involves $403 million in outstanding debt. The board has paid $48 million since December, 2008, to cancel two other swaps, and won’t consider them in the future, Chief Financial Officer John Hanson said today." (Wednesday)

If I'm reading that right, DRPA could end up spending a net $159 million to pay off its own bad bets on interest rates.  The authority's total budget for last year was $239 million. Your toll dollars at work! 

“'It has been the clear direction from this board we’re not interested in doing swaps or swaptions', Hanson said at today’s port authority board meeting in Camden, New Jersey. Swaps and swaptions are used to speculate on and hedge interest-rate risk.

"Municipalities across the U.S. have paid hundreds of millions of dollars to terminate or amend swaps on variable-rate debt after interest costs, instead of climbing, fell to record lows in the worst credit crisis since the Great Depression. The port authority faced the prospect of paying double interest on the debt covered by the pending swap, scheduled to take effect Jan. 1, Hanson said."

Pennsylvania Auditor General Jack Wagner is calling for a state ban on interest-rate swaps after Bethlehem and other upstate cities lost millions of dollars signing complex financial contracts with Wall Street firms. Swaps are contracts where a municipality (or other client) bets an investment bank that interest rates will stay above (or below) a certain point. Swaps were profitable for PA towns before the 2008 credit crisis; since then many have lost millions.

Says Wagner, "Swaps have no place in public financing and should be banned immediately" because, by risking losses, they violate "the fundamental guiding principal" that public funds "should never be exposed to the risk of financial loss." 

He also wants towns' financial advisor contracts put up for bid.

Wagner blames a 2003 law, passed by the General Assembly and signed by Gov. Rendell, for expanding the use of swaps by unsophisticated local officials, and for enriching JPMorgan Chase & Co. and other Wall Street firms at the expense of Pennsylvania towns. He says the law, Act 23, "was written primarily for the benefit and protection of the financial services industry," and noted New York is also weighing a swaps ban.

Wagner says interest rate swaps ("Qualified Interest Rate Management Agreements" under Act 23) worth $15 billion were signed by PA local governments since Act 23 passed. Wagner says a "case study" of two of the first swaps to be completed, by the Bethlehem school district, ended up costing taxpayers $10 million more than a fixed-rate bond, or $15 million more than a traditional variable-rate bond, would have cost, due to "excessive fees and other charges," including a $12 million fee to the city's investment bankers.

»  More PA Auditor: Ban Wall St 'swaps' that cost schools millions

Bob Turner, the Berwyn-based boss of multi-billion-dollar fund manager Turner Investment Partners Inc., whose investment reports are fun to read, whether or not they actually make money for clients (he urged buying US stocks in August 2008, just before the crash), is circulating a primer about LEDs - light-emitting diodes - "The Great Light Hope:" 

LEDs are made of aluminum, phosphorus, arsenic, nitrogen and other non-silicon semi-conductors that glow long, bright, and efficiently, compared to conventional bulbs, and without dangerous mercury, unlike flourescents. "Next-generation" OLEDs (Organic LEDs), made of layers of LED film, can be used in TV and phone screens. Government subsidies (U.S. and foreign) are boosting production, as private orders rise, for manufacturers, who include:

Aixtron (Germany), dominant manufacturer of "metal organic chemical-vapor deposition" equipment for building LEDs
  Cree (North Carolina), an LED lighting maker with big sales in China and (via Zumbotel) Europe
Epistar (Taiwan), LED chip suppplier, sells to Samsung and LG Electronics
  Rubicon Technology (Illinois), makes LED chips based on sapphire gems for handsets, notebook computers, HDTV
Veeco (New York), small Aixtron competitor that also builds solar cell equipment

New Jersey marijuana-industry boosters who thought Gov. Corzine might legalize the disorienting herb now face a less drug-friendly successor, ex-prosecutor turned Gov.-elect Chris Christie. But the pot lobby is pushing one more bill:

"On Monday, November 23, the Senate Judiciary Committee will consider Senate Bill 1866, which would give judges the discretion to waive mandatory minimum sentences for some nonviolent drug offenses," write pot advocates Roseanne Scotti and Tony Newman of the Drug Policy Institute in a public appeal. Senate President Richard J. Codey, D-Essex, is backing the bill. A House version already passed.

The pot lobby says laws imprisoning users and neighborhood dealers "have been a spectacular failure.  They have done nothing to decrease drug activity and have filled New Jersey’s prisons with nonviolent drug offenders at great cost to New Jersey taxpayers." They cite the cost -  $46,000/offender/year - of putting the local pot distributor away. And they cite the anti-urban bias of the 1,000-foot Drug-Free School Zone, since in cities, schools are everywhere.

That's an appealing financial argument for tax-averse New Jerseyans. But the free-the-dealers crowd is less successful when it tries to grab the moral high ground: "Lives often spiral downward after prison," they add in their statement. As opposed to what happens after you smoke a lot of dope?

US Rep. Paul Kanjorski, D-Pa., No. 2 Democrat on the House banking committee, this morning published his proposed rule allowing the proposed Financial Services Oversight Council of government regulators to "rein in and dismantle" giant banks and other companies that are too large, "interconnected" or risky.

Instead of imposing simple tests, Kanjorski leaves standards for what's too big or too complex up to the regulators. Read his amendment to the Obama administration-backed Financial Stability Improvement Act here.

"Chocolate makers The Hershey Co. and Ferrero International SA confirmed Wednesday they are considering a possible offer for Cadbury PLC, which is already the target of a hostile bid by Kraft Foods Inc." 

AP story here.

"Hershey confirms that it is reviewing its options and at this stage there can be no assurance that any proposal or offer from Hershey will be forthcoming," the company said in an announcement to the London Stock Exchange on Wednesday.

"Italy's Ferrero, which makes Nutella chocolate spread and Tic Tacs, posted a similar statement." Cadbury, which dominates foreign markets Hershey covets, has dismissed Kraft's $16 billion offer as inadequate.

The Wall St Journal says Hershey and Ferrero are working together on a bid. So does Bloomberg, story here.

Churches and ministries owe Evangelical Christian Credit Union nearly $1 billion, and more than 10 percent are late on their payments, reports Bloomberg here. "As of Sept. 30, about 10.7 percent of the $943 million of first mortgages held by ECCU were more than 30 days overdue, according to a filing with the National Credit Union Association. That’s an increase from 6.9 percent a year earlier and 4.2 percent at the end of 2007."

Mark Holbrook, president of the California-based credit union, says he's still got plenty of capital. Also, many of the loans were conservatively written with low debt-to-equity ratios, so ECCU can grab the collateral properties and avoid loss.. 

The 80,000-seat Silverdome, built in 1975 on 127 acres in Pontiac, Mich., for the Detroit Lions for $55.7 million bunded by taxpayer-backed bonds, was bought by a Canadian developer for just $583,000 this week, reports  the Detroit News here.

The city was glad to be rid of the place at any price, or no price, it was so expensive to maintain, since the Lions moved out seven years ago, the News says.