How's that working out for those of you who bought that nice **technical** retrace on the dump?
Not so good eh?
PS: SA picks up my stuff on their own. If you want to read it all the time (and there's 10x more than what you see here) look at http://market-ticker.org or stick it on RSS.
Facebook's Rate Of Acquisition Of New Accounts Says It All [View article]
Of course it makes sense.
P/E/G is a measurement of price/earnings measured against growth. That is, P/E adjusted for growth rate.
If P/E/G is ridiculously high then to justify that price growth must DRAMATICALLY expand from where it is now.
The evidence is that it's going to do exactly the opposite.
That doesn't mean the stock won't rip when it opens for trading (it may well do exactly that) but it means the RISK of getting it "in the face" is extremely high.
The time value of money is not zero. Now discount for the time value of money and you're so far underwater you need helium in your breathing gas so you don't offer your regulator to a fish.
We've heard this siren song for 20 years, and it's always five years out from grid parity. Never mind that "grid parity" is only on a peaking basis as once you introduce storage losses the cost skyrockets and you're no longer at "grid parity", which means that base load replacement is not going to happen.
Shhhhh... don't bother this guy with actual math ;-)
PS: Remember too that not only do panels have a service life, so do inverters (and failure potential which means a sinking fund has to be run to replace them if and when they fail.) In addition the net cost of your power includes the transmission lines, switchgear, billing, support (e.g. line and transformer maintenance) and of course that evil thing called "profit" for the people involved. Gross cost at the plant's exit for base load power is a few pennies (literally, like four or five, all-in) per kilowatt-hour in most cases.
For those who think I'm some sort of coal-burning fracking-loving jackass you might consider the article I wrote on this subject about a year ago: http://bit.ly/voUvXl
The problem isn't the leverage per-se. It's the fact that we have refused to slam the door on the fingers of the creeps playing the off-balance sheet game with things like Repo-to-maturity (RTM) deals which they claim are "zero risk" and "not controlled" even though they're grabbing the coupon on the spread.
Off-balance sheet garbage managed to keep everyone in the dark on Enron, on big parts of the subprime mess, and now this. It'll keep happening until we put a stop to accounting shenanigans that on any sort of dispassionate analysis leaves you with an inescapable conclusion that they're a fraudulent edifice along with tossing those who engage in these games in prison.
I'm being polite to them; the problems that come from merchant squeeze if the merchant is truly selling at 25% of original price is so far beyond the stratosphere that it truly will make them a "one trick deal" for ANY company.
C'mon guys - selling at a 75% discount will work for a merchant? REALLY?
What I see is a company that has a severe rollover problem in about a year, and no clear plan to deal with it other than "more debt."
They backed themselves into a corner and now have taken a very expensive bet on a device that has seen its zenith. Facts are facts - while the iPhone had the first mover advantage Android has caught it and now Samsung is shipping more devices as a single manufacturer than Apple is - and there are a lot of other manufacturers (LG and HTC being two of note.)
This is a company that badly needs to "break the glass" in order to survive. They're not an imminent BK but the window to regain confidence in the markets is closing.
There's another problem that plays severely against Sprint here: T-Mobile allows roaming on their prepaid service -- they're pretty much the only carrier that does; in the other cases buying prepaid means inferior service to postpaid as there is no roaming access. Not true for T-Mo, which is somewhat new too - not sure when they did that (it was not always that way), but as of this time their prepaid and postpaid coverage maps are the same. I know factually that there is no native T-Mo coverage in northern Michigan, for example, but they show coverage there - that's on AT&T (who bought out Centennial)
The September Retail Sales Gain Is A Fallacy [View article]
Karl's history on The Market Ticker goes back to April of 2007, which is still there and you can read at your leisure. Further, there's a Ziff-Davis article in which I was quoted from just before it all blew up in 2000 (interview taken before the crash, published after) in which I called that one too, with the reasons why.
Apple: Here It Comes [View article]
Gee, where's the good news going to come from in iPhones?
But keep believing folks, it's all you have left.
Apple: Here It Comes [View article]
Not so good eh?
PS: SA picks up my stuff on their own. If you want to read it all the time (and there's 10x more than what you see here) look at http://market-ticker.org or stick it on RSS.
Facebook's Rate Of Acquisition Of New Accounts Says It All [View article]
P/E/G is a measurement of price/earnings measured against growth. That is, P/E adjusted for growth rate.
If P/E/G is ridiculously high then to justify that price growth must DRAMATICALLY expand from where it is now.
The evidence is that it's going to do exactly the opposite.
That doesn't mean the stock won't rip when it opens for trading (it may well do exactly that) but it means the RISK of getting it "in the face" is extremely high.
Why I Ran Away From Municipal Bonds In 2007 [View article]
That's a rather thin assumption; it works well if defaults are very rare and disperse. If they're not, well.....
Is Sears Going Down The Tubes? [View article]
Solar: Here It Comes [View article]
Solar: Here It Comes [View article]
Solar: Here It Comes [View article]
Solar is a scam and exists only because of massive subsidies.
Solar: Here It Comes [View article]
This author is well-aware of the costs of an offline (e.g. batteries included) system, their service life, and the economics of using them.
Your underwear is showing -- along with your desire to more than double the energy cost paid by Americans.
Solar: Here It Comes [View article]
PS: Remember too that not only do panels have a service life, so do inverters (and failure potential which means a sinking fund has to be run to replace them if and when they fail.) In addition the net cost of your power includes the transmission lines, switchgear, billing, support (e.g. line and transformer maintenance) and of course that evil thing called "profit" for the people involved. Gross cost at the plant's exit for base load power is a few pennies (literally, like four or five, all-in) per kilowatt-hour in most cases.
For those who think I'm some sort of coal-burning fracking-loving jackass you might consider the article I wrote on this subject about a year ago: http://bit.ly/voUvXl
Is Sears Going Down The Tubes? [View article]
MF Global, Risk Management And You [View article]
Off-balance sheet garbage managed to keep everyone in the dark on Enron, on big parts of the subprime mess, and now this. It'll keep happening until we put a stop to accounting shenanigans that on any sort of dispassionate analysis leaves you with an inescapable conclusion that they're a fraudulent edifice along with tossing those who engage in these games in prison.
Is Groupon Another Pets.com? [View article]
C'mon guys - selling at a 75% discount will work for a merchant? REALLY?
Sprint Blows An Opportunity [View article]
They backed themselves into a corner and now have taken a very expensive bet on a device that has seen its zenith. Facts are facts - while the iPhone had the first mover advantage Android has caught it and now Samsung is shipping more devices as a single manufacturer than Apple is - and there are a lot of other manufacturers (LG and HTC being two of note.)
This is a company that badly needs to "break the glass" in order to survive. They're not an imminent BK but the window to regain confidence in the markets is closing.
There's another problem that plays severely against Sprint here: T-Mobile allows roaming on their prepaid service -- they're pretty much the only carrier that does; in the other cases buying prepaid means inferior service to postpaid as there is no roaming access. Not true for T-Mo, which is somewhat new too - not sure when they did that (it was not always that way), but as of this time their prepaid and postpaid coverage maps are the same. I know factually that there is no native T-Mo coverage in northern Michigan, for example, but they show coverage there - that's on AT&T (who bought out Centennial)
The September Retail Sales Gain Is A Fallacy [View article]