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Clayton Reeves  

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  • U.S. home prices dipped 0.6% in July and remained flat Y/Y, CoreLogic reports: "Home prices fell in 36 states in July, nearly twice the number in May and the highest since last November." With sellers adding up to 12M more properties to the market, analysts say the slide in home prices may have another three years to go.  [View news story]
    People who think we're in the middle of a recovery, especially in terms of the housing market, are certifiably insane. My take from a month ago ( needs updating, but the underlying momentum remains the same.

    Sep 15, 2010. 04:06 PM | 2 Likes Like |Link to Comment
  • That housing article could not be less convincing. Housing will bounce back... someday. When baby boomers retire and move to nursing homes, and people from Singapore decide to work in San Francisco and don't want to own a house? Globalization will make it less necessary to get on a plane, and easier to have meetings via web technologies. If anything, the "mobility" he speaks of will increase due to this technology, not moving constantly from dwelling to dwelling.
    Sep 15, 2010. 12:48 PM | 2 Likes Like |Link to Comment
  • HP Continues Burning Through Its Wallet [View article]
    Not to mention, even if they succeed in the interim they usually mortgage the long term interests of the company. The problem lies with the incentive to meet a quarterly goal, then jump ship in a golden parachute that many times exceeds your annual pay. Who made up these crazy rules??

    Oh, that's right, boards comprised of... executives.
    Sep 15, 2010. 11:41 AM | 1 Like Like |Link to Comment
  • What You Need to Know About the Bank of Japan Intervention [View article]
    "A Reuters report cited EC officials noting that exchange rates should reflect economic fundamentals. It also noted that despite Japan’s current account deficit, too rapid currency appreciation could threaten economic recovery."

    I would think that the free market is a better guide to follow than a book written by man... If Japan and China get to decide where their currency trades, how does that reflect economic fundamentals? Wouldn't the free market more readily reflect these attributes? I think this is just a way for China and Japan to support their exports while the US struggles with their trade deficit. It might be time to fight fire with fire.
    Sep 15, 2010. 11:39 AM | Likes Like |Link to Comment
  • Bank of Japan's Currency Intervention: What It Means for FX Traders [View article]
    "chastises those who act differently (e.g. China)."

    I'm not sure they chastise them enough! Currency manipulators are resistant to change, that is all. Instead of letting their economies evolve (with a fair amount of adjustment and pain) from manufacturing to more complex services, they keep their currencies weak enough that they can grow based on exports. But, it isn't a sustainable model.
    Sep 15, 2010. 11:17 AM | Likes Like |Link to Comment
  • Yen Intervention, China and the U.S. Dollar [View article]
    I couldn't agree more. We already have one egregious currency manipulator ( stifling the world economy and seemingly operating without consequence. Now, it looks like we have what more or less represents a conveyor belt of dollars between the US, Japan and China. The fact that this intervention will not be sterilized also tells me who Japan would rather be handmaiden to over the next decade, and it isn't the US of A.

    I don't think accusing someone of "passing the buck" has ever been more appropriate.
    Sep 15, 2010. 10:57 AM | 3 Likes Like |Link to Comment
  • Steadfast Yuan Stymies Recovery [View article]
    Thanks for reading, Charlie. I do understand the relationship between the current and capital accounts, and the split between the private/gov't sector debt loads. My point was, and it may have been poorly written, that there is a huge risk in terms of continued faith in the dollar. That is, in order for foreign investors to keep investing in either our government or private sector, they must have reasonable assurance of the debt being repaid and the dollar storing value. If any more major stimulus or quantitative easing is undertaken, I think the stability (over the long term) of the dollar as the world's reserve currency could be threatened. I would venture to guess that won't happen, but it is certainly a possibility.
    Sep 12, 2010. 02:45 PM | 2 Likes Like |Link to Comment
  • European Austerity Still Isn't Working [View article]
    Without any measures to increase consumption in the Eurozone, their fiscal "discipline" will all be for naught. Germany might be a powerhouse, but their trade surplus puts pressure on other nations that certainly can't handle it right now. I see a rocky road... which begs the question: why did everyone go bullish on Europe a couple weeks ago when all signs pointed to trouble (
    Sep 8, 2010. 02:31 PM | 4 Likes Like |Link to Comment
  • Transocean: Undervalued and Ripe for the Buying [View article]
    News today about those liabilities(

    I still believe that their impact will be stretched over such a long period, that RIG will be able to absorb any losses without material impact to their business or my valuation.
    Sep 8, 2010. 11:50 AM | 1 Like Like |Link to Comment
  • No Reason To Be Optimistic About House Prices [View article]
    The picture has never been murkier... I personally think housing has some room to fall ( but it is not certain. I also think that it is an oversimplification to conclude that housing moves directly with incomes. Housing moves with incomes, sure, all else being equal, but with the massive inventories that are likely to stick around will apply downward pressure regardless of incomes. Again, making the picture murkier than pond water.
    Sep 8, 2010. 11:47 AM | 3 Likes Like |Link to Comment
  • 'Beggar Thy Neighbor' Mentality: Competitive Trade Balance Only Way Out of Fiscal Crisis [View article]
    I totally agree with your sentiments on Europe. Markets did an about face without any fundamental changes occurring that were worth mentioning. Germany is fostering the trade imbalance in Europe by refusing implement a plan to increase consumption. With the competitive advantages and without the ability of their currency to deviate from that of their less efficient southern European neighbors, Germany will continue to foster the instability in the region.
    Sep 7, 2010. 06:12 PM | 1 Like Like |Link to Comment
  • Gold rallies to an all-time high of $1,259.30, "a direct indictment of the Fed’s monetary policy in terms of its dollar debasement," Peter Boockvar writes. "People don’t own gold because they want to, they own it because they feel they have to. It’s called self-defense."  [View news story]
    Interesting take on gold...
    Sep 7, 2010. 02:53 PM | Likes Like |Link to Comment
  • Gold rallies to an all-time high of $1,259.30, "a direct indictment of the Fed’s monetary policy in terms of its dollar debasement," Peter Boockvar writes. "People don’t own gold because they want to, they own it because they feel they have to. It’s called self-defense."  [View news story]
    Definitely a form of self defense.. you can print money but you can't print gold.
    Sep 7, 2010. 02:25 PM | 2 Likes Like |Link to Comment
  • Market Outlook: It's the Economy, Stupid [View article]
    Nice article. I think stocks are currently priced to expect some extended downward pressure, but not the worst. You are correct in saying that bull are reacting to the slightest of good news (lukewarm jobs data, misleading ISM numbers, etc.) but is there another market dip after this mini-rally before anything sticks?

    I think hiring will be the real catalyst to a sustained recovery, and that may be a ways off. Corporate spending can go up, but if they don't start hiring I see the market stagnating for a while longer ( Companies are not hiring because they need the money pile to give Wall St confidence, and people are not investing because they don't feel secure. It's a problematic loop.
    Sep 7, 2010. 02:04 PM | Likes Like |Link to Comment
  • Market Review: Traders, Investors Turn Defensive on Bad Economic News [View article]
    I think that lost trust is one of the more important factors moving forward. I see no reason for the common investor to reengage a market that seems to zig and zag like a drunk driver for no apparent reason.

    I definitely agree with your article, and I think the triangle of joblessness, decreasing home prices and faithlessness in financial institutions will be enough to offset the recent success the private sector has been having, at least for awhile.
    Sep 2, 2010. 01:42 PM | 1 Like Like |Link to Comment