The 5 Dumbest Things on Wall Street This Week: Jan. 11

5. Sokol's Low Blow

Say it ain't so, Sokol! We knew you were a shady character, but we didn't think you were this dark.

One-time Berkshire Hathaway ( BRK-A) big shot David Sokol mocked his former mentor, Warren Buffett, last Friday, scorning the billionaire investor after regulators cleared him of any wrongdoing regarding the trade that led to his March 2011 resignation. Sokol, in case you've forgotten, was once Buffett's golden boy, as well as a leading candidate to succeed the octogenarian as chief of the $232 billion dollar holding company. He fell from grace, however, after it was revealed he personally bought a boatload of Lubrizol shares before pitching the chemical maker to Buffett as an ideal investment for Berkshire.

Buffett initially backed Sokol after the Lubrizol trade blew up in the press, saying Sokol's actions were not "in any way unlawful." Nevertheless, he eventually turned on his protégé after digging deeper into the details of Sokol's shenanigans.

"I will never understand why Mr. Buffett chose to hurt my family in such a way, but given that he is rapidly approaching his judgement sic day, I will leave his verdict to a higher power," Sokol wrote to The Wall Street Journal.

A "higher power"? That's a sick thing to say. We may have had our own issues with Buffett's behavior in the past, but that's way beyond the pale.

Moreover, the notion that Sokol's family was harmed in any manner, well, that's plain ludicrous. Sokol pocketed nearly $3 million on his $10 million investment when Berkshire agreed to buy Lubrizol only a few months after he brought it to Buffett's attention. Sokol's net worth -- thanks to Buffett's benevolence -- is reportedly well over a hundred million dollars.

As for why the SEC dropped the investigation, we can only imagine it couldn't concretely prove that Sokol knew Berkshire was going to buy Lubrizol before he personally dipped his big toe in.

And as to what Warren Buffett ever saw in this shyster in the first place?

Clearly, the Oracle of Omaha had a pretty severe blind spot in this case.

4. Bill and Eric's Excellent Adventure

Hey, Eric Schmidt, your company just won the Super Bowl of antitrust investigations. What are you going to do next?

What? You're going to North Korea?

What the heck's wrong with Disney World? Or any other place on earth where the government doesn't starve its citizens in gulags?

A week following Google's ( GOOG) victory over the FTC, and only a few weeks after a provocative North Korean rocket launch, the search giant's chairman ignored the State Department's admonitions and joined former New Mexico Gov. Bill Richardson this week on a four-day private trip to Pyongyang. Richardson, speaking prior to the pair's flight from Beijing on Monday, assured the press that it was a humanitarian visit as opposed to "a Google trip," and that Schmidt was interested in "the social media aspect" of the country's economy.

Social media, our ass. Those people need food, not Farmville! They aren't allowed out of the country, let alone onto the World Wide Web.

"We'll meet with North Korean political leaders. We'll meet with North Korean economic leaders, military. We'll visit some universities. We don't control the visit," said former presidential candidate Richardson before their trip.

No bull, Bill. You and Eric certainly didn't need Google to find the best restaurants in Pyongyang during your stay, did you? We're sure Kim Jong-un selected them for you. For that matter, we're confident he gave extra special treatment to your entire party of political pawns simply to stick it to the disapproving folks at Foggy Bottom.

"We don't think the timing of the visit is helpful, and they are well aware of our views," State Department spokeswoman Victoria Nuland told reporters last week.

Look, Eric, we understand you want to wire the world and promote freedom through Internet connections. We know that, deep down, you and your Google cohorts wish to "Do No Evil." Or at least that's what you tell folks when you aren't snooping on them.

Unfortunately, North Korea's ruler is an autocratic nutcase who has a different point of view. There is no doubt Kim loved all the attention you foisted upon him right after his saber-rattling missile launch. And the fact that you showed up the State Department by showing up in a country where Google isn't even allowed to do business must have only made the so-called Great Leader even giddier.

3. Accuray Disarray

It may be a brand new year, yet our analyst friends on Wall Street are still up to the same old tricks.

Or as we say here at The Dumbest Lab: The more things change, the more they stay inane.

Take the case of poor, poor Accuray ( ARAY), for example.

The company has lost nearly a third of its stock-market value since last Friday after it announced that it anticipates fiscal second-quarter revenue of $72 million to $75 million compared to the $94 million Wall Street analysts were expecting. The company's brass blamed problems with its sales force, manufacturing and supply chain -- basically everything up to and including the leaky kitchen sink -- for the sales shortfall.

For the 2013 fiscal year, Accuray expects a loss of 87 to 95 cents per share on revenue of $320 million to $330 million. Analysts were on record predicting the company would post an adjusted loss of 55 cents per share on revenue of $406 million for the year.

Yep, Accuray proved its analyst followers to be anything but accurate with their forecasts. Nevertheless, despite the stock's shellacking, Accuray's fans on Wall Street remained resolute.

In his note titled "No visibility, but can't get much cheaper," Lazard Capital Markets analyst Sean Lavin opined: "While we and it seems management have limited visibility on future orders and revenue, we remain at 'buy' given the shares were trading at just 0.88x in afterhours vs. our 12-24 month revenue estimate. That said, we believe the upside outweighs the downside. We see an investment in Accuray as one with significant potential upside, but also a lot of risk."

Um, sorry Sean, but if the stock "can't get much cheaper," then how is there "also a lot of risk"? It seems to us like there is a bit of a disconnect there, dontcha think?

Jefferies analyst Raj Denhoy offered even more of a head-scratcher for his loyal hangers-on. Denhoy kept his "buy" rating on the stock while drastically reducing his price target to $6.50 from $10, saying: "The reset under new management was expected but the severity was a surprise."

Thanks, Raj. That's like saying: "We expected the company to kick its shareholders in the groin; we just didn't think it would be that hard."

Come on, guys. There's no need to experiment with any new excuses for your bad calls simply because it's a new year. Stick with the classic and you'll be fine. Simply say: "We loved Accuray as a 'buy' at $7, but we really love it at $4.80."

What's so hard about that?

2. Sears Strikes Out

New York Yankees boss George Steinbrenner had nothing on Eddie Lampert in the game of hiring and firing his skippers.

In the latest managerial switcheroo at the iconic retailer, Sears ( SHLD) announced Tuesday that Chairman Eddie Lampert will take the top job from Louis D'Ambrosio, who is stepping down due to a family member's health issue. Sears shares sank over 6% on the news that D'Ambrosio was done as CEO and Lampert, whose holding company owns over 55% of the Sears stock, was moving into the corner office.

Not that Lampert wasn't minding the store the whole time, mind you.

For those not keeping score, Lampert hired D'Ambrosio in February 2011 to replace W. Bruce Johnson. Johnson, for the record, was hired to replace Alwyn Lewis in 2008. Lewis, in case you forgot, replaced Alan Lacy, who joined Lampert's ranks in 2005 after the billionaire hedge fund manager bought Kmart out of bankruptcy and smushed it together with Sears.

Tally it up, and you'll see that Lampert's latest selection makes him Sears' fifth CEO in seven years. Heck, the only change that Lampert didn't make was bringing back Billy Martin from Yankee heaven (or Red Sox Hell) to run the former world champion retailer.

That said, tinkerer that he was, Steinbrenner was never bold (or stupid) enough to relocate from the owner's box to the dugout to manage the Bronx Bombers himself. And that, apparently, is what Eddie seems intent on doing this time, much to the dismay of the analyst community, which has repeatedly pleaded with the one-time Wall Street darling to stop fiddling while Sears burns.

And like the Bronx during the summer of 1977, Sears surely is burning. The company said Monday that its net loss for the current quarter will be between $280 and $360 million, or between $2.64 and $3.40 a share. Sales at Sears have been declining yearly since 2007, certainly not a streak Joe DiMaggio would envy.

Let's be honest -- even Marilyn could hit better than that.

Look, what Lampert needs is his version of Joe Torre. Somebody who can bring some serenity to the organization as it tries to beat its rivals. And on that note, the Red Sox and its Green Monster are nothing compared to the monstrous competition Sears faces from like likes of Wal-Mart and Target.

That said, even with a steadying force in Sears dugout, there seems to be little doubt that the company is taking itself out of contention. Lampert's game plan has been to sell stores and assets in order to raise cash. And unlike Steinbrenner's well-known spending sprees for available (although sometimes questionable) talent, Lampert has been starving his stores of capital to the point where shoppers have been staying away in droves.

We honestly don't know what Lampert's end game is for Sears. It was all about the value of the real estate at one point and then it was all about the company's brands. We're not sure what his next pitch will be.

But we do know that unless he changes something soon at Sears, the mighty Eddie has struck out.

1. AIG or $1 Trillion Coin?

What's dumber, a $1 trillion platinum coin designed to solve America's debt ceiling dilemma, or AIG ( AIG) suing the same U.S. government that spent $182 billion to bail it out?

Oh, man, that's a tough choice even for us. And we do this for a living!

Let's start with the trillion dollar coin idea that bubbled up from online columns to the halls of Congress this week.

Under the scheme, the U.S. Treasury would employ an obscure commemorative-coin law to mint a single platinum coin with a trillion dollar face value and deposit it at the Federal Reserve. The government, as a result, would then have the collateral to buy back its Treasuries, giving Uncle Sam some extra headroom as he bumps up against the $16.4 trillion debt ceiling.

Rep. Jerrold Nadler (D., N.Y.) announced he was "absolutely serious" about the coin concept. On the other side of the aisle, Rep. Greg Walden (R., Ore.) said he would introduce a bill to block the Treasury from making such a move.

For our part, we just hope Fed Chairman Ben Bernanke doesn't mistakenly use the coin for a lunchtime game of Ms. Pac-Man because then it would really be game over for the country.

As for our good friends at AIG, well, we remember a time not too long ago when they were so desperate that they would have seriously considered such bullion chicanery to stay afloat. (By the way, the Fed won't accept $1 trillion bullion coins, signed baseballs or Sound of Music commemorative dishes as collateral unless Congress passes some wacky legislation, so the whole idea was asinine from the start.) Who can forget the massive hole the company dug itself into thanks to Joe Cassano's multibillion-dollar derivative bets, only to be saved by the government taking a 92% stake in the company?

Well, maybe the Department of Justice has forgotten since Cassano never went to jail or suffered a smidgen for his rogue trading sins. But that's not the point.

Anyway, the arrival of CEO Robert Benmosche in 2009 changed the entire trajectory of the company. After hitting rock bottom, the insurance giant has bounced back to prosperity. Shares of the insurer have risen nearly 50% in the past year and the company repaid the last of its bailout bucks in December. Uncle Sam didn't do so badly either, pocketing $22.7 billion on its rescue mission.

AIG's saga was indeed a shining example of a government bailout gone right. That is, until this week, when the ghost of AIG past popped up.

AIG's board was forced to gather this Wednesday to consider a lawsuit filed by former CEO Hank Greenberg (no relation to a certain Dumbest author) against the government over the terms of the bailout. Greenberg alleges that the government's bailout terms were usurious. The American public, on the other hand, denounced Greenberg's lack of gratitude.

Greenberg, if you've ever met him, doesn't give a crap what the public thinks. But, once again, that's not the point.

In the end, AIG's board made the sane choice and said it would not bite the hand that rescued it. Greenberg, alas, will have to sue the government without AIG's support.

Hmm. You know what? Don't throw away that trillion dollar coin just yet.

If Hank intends to take this all the way to the Supreme Court, as we think he might, he may need that coin to pay his legal bills.

Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.

More from Opinion

Cable Stock Investors Should Keep an Eye On Wireless Broadband's Rise

Cable Stock Investors Should Keep an Eye On Wireless Broadband's Rise

Trump Blinks on China Trade War That's Looking Harder to Win

Trump Blinks on China Trade War That's Looking Harder to Win

Monday Madness: GE, China, and Micron

Monday Madness: GE, China, and Micron

Attention 60 Minutes: Google Isn't the Only Big-Tech Monopoly

Attention 60 Minutes: Google Isn't the Only Big-Tech Monopoly

How Technology Will Unleash the Legal Marijuana Industry's Growth Potential

How Technology Will Unleash the Legal Marijuana Industry's Growth Potential