Puda Coal (PUDZ)  is a company I’ve covered several times as one that I felt would uplist. They are doing it tomorrow (Tuesday). They are currently a supplier of metallurgical coking coal in the PRC. Since I’ve covered them their ticker has changed from PUDC to PUDZ and is now changing to PUDA tomorrow. Why do I think they are Fired up? They’ve talked about consolidating 6 mines in Yuncheng City, they’re priced to shrink, and they are uplisting this week. Don’t forget that there is a coal mine consolidation party in that neck of the woods. It’s my belief that you’ll be lucky if you see these prices ever again as they are currently floating above $5 making them a candidate for mutual funds who likely can’t wait to get their grubby little fingers all over this value play.

Songzai International (SGZH) has a trailing P/E of 3.2 and is also engaged in coal production in the PRC. With 25% of their market capitalization in cash, some would argue it’s cheap. Combine that with their reported double in sales and net income year over year this last quarter. Note the results were unaudited. Currently Songzai trades at uplistable and mutual fund friendly prices. I think that’s where they are headed even though they’ve made no public statement. I would categorize this as a “no-brainer” because I think that it doesn’t take much of a braniac to figure out that they’re giving this away.

L&L Holdings (LLFH) gives off the distinguished aroma that I call uplist. Yes, they too are in the business of coal mining in the PRC. Do note that this is 100% personal speculation, but my instinct tells me that I’m hot on the trail. My instinct tells me that uplisting is coming in the very near future. Who knows? What I do know is that they appear to be an acquisition machine in the perfect market to acquire. They are priced to stagnate and grew revenues 70% last year. They are cents away from being mutual fund friendly.

                In my opinion, the trick to buying undervalued companies is buying them before everyone else “realizes what’s going on.” It’s kind of like bargain shopping for sports cars --- something you probably don’t do every day. Odds are that you don’t see a brand new Lamborghini or Ferrari for sale. But say that you do. Say that it’s priced at $10,000. Are going to wait for the next person to walk by or are you going to fire it up?

Disclaimer: Bradford was long Puda, Songzai and L&L at the time of publication.

The purpose of this article is to outline my quest for the cheapest broker that lets me “do what I want” with the least amount of hassle and how the real hassle is always behind the scenes. I’ll also outline the public companies from the perspective as an investor.

 I currently can trade with Firsttrade, Schwab (SCHW), Ameritrade (AMTD), E*Trade (ETFC), Merrill Lynch (BAC), and I have checking accounts with Fifth Third (FITB), and a savings account at Bank of America (BAC). So, what’s the scoop and why am I writing this article? I’ve been setting up a new E*Trade account for the past month and my patience is wearing thin. Why did I choose to open another account with E*Trade?

Merrill Lynch (BAC) won’t let me buy stocks less than $1. This is to protect me from myself, I suppose. But what happens when a company that you value over $10 goes below $1? Odds are you’d like to buy more and now your left buying it at a higher price of at least $1, whenever it surfaces back above that waterline. All for $29.95 a trade. What a great deal! Not.

Ameritrade (AMTD) has the best interface and is honestly in my opinion the best, except for that it won’t let me buy certain penny stocks because it doesn’t like the transfer agent. I fought Ameritrade on this a little bit, because if they would simply let me buy the companies that I want to buy, I’d push all my accounts to them.

Firsttrade also won't let me buy all the securities that I want to buy. It is also in my opinion "less pretty" than Ameritrade.

Schwab lets me buy pretty much anything I want, but Schwab has proven to be a little more hands on than what I’d like them to be. I got a margin call on a $30,000 account that was over half marginable securities and we were sitting on about $1,000 of margin. That’s pretty ridiculous. Also, Schwab is more expensive than E*Trade.

So, here I am, setting up another account with E*Trade (ETFC) because I know it will be the most flexible once I get it going. I’ve been trying to set up this account for over a month now and have made a frustration timeline that you can see below. I’m still in limbo and haven’t received a phone call from E*Trade. I’ve had to take the initiative to call them up and follow up as to where exactly the money I sent them is. They still aren’t sure, so there is roughly $115,000.00 floating out there in E*Trade land.

Alright, how do these companies stack up as far as investments go? I would say that Schwab (SCHW) and Ameritrade (AMTD) are reasonably priced. Bank of America and Merrill (BAC) still appear to have over 100% upside potential within the next year and so does Fifth Third (FITB).

Lastly, I’ll note that I’ve been asked by a couple Fifth Third employees what I would consider investing in. I asked them if they had ever considered buying Fifth Third (FITB).

Disclosure: Glen and his investors own FITB and BAC.

I see headlines including phrases like “End of an Era,” “The Biggest Bankruptcies in History,” “Why Your Home May Be a Bad Investment,” “Road to Bankruptcy,” etc. Let’s take a walk on the wild side and get Iced Out in China. That’s the new lingo for saying, let’s take a look at a few luxury goods companies in China that are set to appreciate in price more than the stock market in the next year as the global stock markets continue to rebound.

But first, I’d like to address the VIX, which has frequently been used to gauge market fear and uncertainty over the past year. I propose that it is not measuring fear at the moment, but rather is measuring the market rallying potential. Seeing as how it measures future expected volatility, it can either get expensive if this is positive or negative expected volatility. My belief now is that it is the positive market potential that is holding the VIX above 25. Feel free to call this the Panic-Buy-Hypothesis and to compare it to the Efficient-Market-Hypot... Initially, it was the reversion back to reality that turned the shorts to cover themselves as their tide went out and they were left naked. Before that, they were the cool kids in town and everyone was jealous of their skinny dipping ways. This has been going on too long and money is starting to come off the sidelines to “start speculating.”

The long run implications of this speculation money feeding the global bull market cycle include people getting rich and buying luxury goods. Sure, you could take advantage of this by buying Gold (GLD), but I think you’d be missing out on the real action. My sentiment is that the global fear contagion drove a lot of people stashing their assets in the dollar and US Treasuries. As the fear dissipates, the bears go into hibernation and springtime speculation has been in great abundance. I expect that the newer picture involves less dollar demand and more demand for the global assets that have been shunned into oblivion over the last 2 years.

If you want to buy low and sell high, here’s idea #1. Jade Art Group (JADA) is off 92% from where it opened in January. Then, I wasn’t interested because I had other, more inexpensive companies on my plate. Now, I’m a fan --- especially because they deal with raw jade and I consider this a luxury good. When good companies get cheap, I get greedy.

If you want a couple ideas to compare this to, look at Fuqi International (FUQI), Zale (ZLC), Blue Nile (NILE), and LJ International (JADE). Fuqi is up over 300% in the last 3 months. What was once a dirty cheap good company is slowly but surely becoming more reasonably priced. We aren’t there yet, but we are getting there. LJ International (JADE) is more likely to go up than down in my opinion as well.

Generally, when you are past the end of an era, it’s time for a new one. In time, investors are likely to become more certain than uncertain and companies that make wise decisions are more likely to continue to exist through tough times than those that do not. If you follow the sentiment of the headlines, you’ll likely be buying high and selling low. Cramer is a rarity as far as a millionaire journalist goes. Nobody really knows everything, but everyone is willing to tell you what they think if you ask.

 If you entrust others to do your homework for you, how do you expect to beat them? Listen to those who beat the market and question everything all the time. Read what they say, not the headlines. Buffett in his “Buy American. I Am” piece was on the same page I was. US Treasuries were overbought. US Stocks were cheaper than they had been in a long time. He was speculating that at that point in time, US Stocks were a better investment than Treasuries. Misunderstanding driving directions could land you in an entirely different destination and out of gas. Misunderstanding investment legends is no different. I would speculate that he was not saying that American Stocks were the best investment at the time, just comparatively better. He’s also said: The 19th century belonged to England, the 20th century belonged to the U.S., and the 21st century belongs to China. Invest accordingly. And so, that’s what I’m doing.

Disclosure: Glen and his investors own Jade Art Group (JADA).

Instead of talking about finance institutions that are being diluted like Citigroup (C) and financial institutions that are so hot they’re already above their November lows like Wells Fargo (WFC) and Goldman Sachs (GS), I’m going to introduce you to a better place where it’s bottoms up from here.

After getting the wind knocked out of it, Anthracite Capital (AHR) shows signs of life. Granted that the price has probably exploded higher from $0.74 by the time this article gets published, let us use it at a baseline. What do we know about Anthracite at $0.74?

1.   Anthracite is trading at a P/E of 0.487 if you knock out the Q4 2008 earnings nightmare and look back 1 year from Q3. The reason I took out Q4 is because the loss claimed appears to be a one-time huge write off, followed by positive earnings the next quarter.

2.   Anthracite Capital is trading at a book value of 0.1.

3.   Anthracite Capital is traded on the New York Stock Exchange. Let me repeat. This is a company cheaper than the listing requirements on the New York Stock Exchange. It either increases in price or eventually gets delisted.

All of these figures indicate that Anthracite is priced for bankruptcy. Where’s the good news?

1.   They have pushed back the disaster twice already and have been in talks to resolve the issue. If I know anything about creditors, the last thing they want to do is run their debtors into the ground.

2.   Anthracite was profitable in Q1 2009, just not as profitable as it used to be. If you flat line the profit figures from Q1 2009 into the future, your P/E is still 0.685. Note that Q1 of 2008’s Net Income Applicable to Common Shareholders is twice as large of that of any quarter as far back as I can see. So, comparing Q1 2009 to Q1 2008 isn’t fair to begin with. The bottom line here is that comparing the income of Q1 2009 to Anthracite’s history --- things match up but the revenues are weaker.

So, what am I doing about it? I’m buying. I probably already have a sizeable position. I’d say you could add this to my suggestions for 100% in 1 month, but that would be an understatement. I’d be surprised if AHR didn’t see $2 by June 18^th.

Disclosure: Glen and his investors own AHR and C.

Jim Cramer is right. I’m going to stand up and shoot for 100% in 1 month with a couple stocks. All of them are set for huge gains when the mutual funds grab them at $5.

Conseco (CNO) --- I’ve been yelling about this one since $0.33 when I backed up the truck. I came up with a 2009 EPS of $0.85 weeks before the analyst updated his estimate to include the restructure I forecasted. You too can ride this to $7 --- more than 100%.

Genworth Financial (GNW) --- They didn’t need the TARP. That’s a sign of strength. Just popped to $5. Next stop: $12. Get ahead of the curve and allocate your holdings where the money is heading next. Don’t wait!

American Capital (ACAS) --- I am anticipating a restructure of their current debt obligations. Note that this can bring back a huge yield if you sit tight. Odds are the restructure will eat out of short term (1-2 years) profit margins, but the stock price will soar. $8 is just around the corner.

I don’t respect people that recommend things that they themselves do not own. That’s why I’m long all the companies mentioned in this article. If you’re interested in banks, shoot the middle of the road and start with the ones that are down the most over the last 2 years and up the most over the last 2 months. That way you’ll pick up bargain banks that hopefully aren’t dead beats. A couple that I own are Fifth Third Bancorp (FITB) and Huntington Bancshares (HBAN).

Disclosure: Glen and his investors own CNO, GNW, ACAS, FITB, HBAN

After sitting through my first year of MBA coursework and having the EMF crammed down my throat like trying to eat a spoonful of cinnamon, my gastrointestinal reflexes have had enough. Wikipedia puts it best: “The efficient-market hypothesis (EMF) states that it is impossible to consistently outperform the market by using any information that the market already knows, except through luck. …Empirical analyses have consistently found problems with the efficient markets hypothesis, the most consistent being that stocks with low price to earnings (and similarly, low price to cash-flow or book value) outperform other stocks.”

I’m the guy that sat through upper level psychology courses and disproved a significant quantity of their best-practices by showing that indeed their preferred treatments were statistically insignificant from the placebo. You may think I’m nuts, suspicion always was the signature of incompetence. There has always been room for these type of tipping-point broad-scale logical conundrums. For example, the world used to be flat. Even when proven otherwise, it took years to get to a spherical world.

Empirically disproving a hypothesis normally pushes them into oblivion, but the EMF is one that has been chosen for mindless perpetuation throughout MBA schools across the United States, as evidenced by my curriculum questioning at various MBA Case Competitions.

If you want it… Go get it. Period.

1. Figure out what works

I started with the most successful investor and worked backwords. An overview of what ideas I’ve traversed across can be found here. I would like to add that this works in every market and that I believe that every market average can be beaten through due diligence. Do note that settling for average shouldn’t always be frowned upon as it may be satisficing.

2. Do it

Find people that are doing what you want to be doing and start imitating. This is where most people go wrong and lose scope of the fact that if compounding interest isn’t working for them or they don’t know what it is --- it is most surely working against them. If it’s not working, you might be doing it wrong.

3. Kaizen/Continuous Improvement

The goal here is to continuously redefine your decision making structure in order to continuously improve your definition of what works to align with what actually happens.

3 New Chinese Microcap Picks as Potential Empirical Evidence Against The EMH

Further, I've attached my current radar. XING and QXM are at the top because they are trading at a significant discount to their book value.

1. Sell less than Cash – Total Liabilities

China Agri-Business (CHBU) is currently selling for less than net cash, is making money, and is growing. It’s really tough to complain about this kind of opportunity. That said, my mom is selling this company because I’ve made her a lot of money on it. I personally think that’s bad logic --- because I’d rather sell it at Cash-Total Liabilities. This type of "trading end game" behavior or selling out before something obvious hits a realistic value is what gives people like me an edge. I don't see a need to sell something because it went up 20% if it's down 90% over the last 2 years. I also don't see a need to buy it either --- unless my calculated intrinsic value supports buying or selling behavior.

2. Sell off on “Bad” News

China Energy Corp (CHGY) is down over 50% from where we were a week or so ago. This bad news is that they closed down to increase the safety of operations. In my opinion, the long-term good news is significantly overpowering the bad news --- especially at this bargain bin price. I have its earnings pegged at $0.15 a share and huge catalysts on the horizon that are simply not priced into the company’s market cap. After the huge increases in capacity and stupid roadblocks of 2008 beat down this stock, I can see why investors are getting anxious and trying to sell out. Good news for me. I'm a net buyer.

3. Sell less than what you’ll make the rest of this year.

Oriental Paper Inc (OPAI) has taken a beating even though it’s making more money than it’s going to make for the rest of this year ignoring that it made money this first quarter. This is one of my top holdings at the moment.

That wasn’t so bad.

Not everything is worth knowing. The person speaking the loudest may have the least to say. Optimistically bounding uncertainty drives aggressive ignorance and the market boom/bust cycle. High power defective reasoning will continue to come from empty suits. Short-sightedness will always weigh in on long-term decisions. The point is this: blindly accepting what other people tell you works to their advantage and not yours. You will only get ahead by being better than average. To be better than average, you must do something different. Keep in mind that this isn’t for everyone. The first step to getting what you want is determining exactly what it is that you want.

I’m the kind of guy that questions everything and is willing to take a stand until empirically proven otherwise. I’m not a scientist --- I’m an engineer. I am not interested in learning how things work except for knowing the best way to make them work advantageously. No matter how seemingly self-evident something may be, people still may not understand. Never underestimate the predictability of stupidity.

Disclosure: Glen and his investors own CHBU, CHGY, OPAI, GHII, NWD, AKRK, CNOA, LTUS, CNO, LPIH, CNEH, CKGT, CYXN, CHCG, GNPH, CAEI, XING and through XING: QXM.