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Marc Gerstein

 
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  • Apple's iPhone 6 Market Impacts [View article]
    Just for the heck of it, I checked Max price charts for AAPL and AMZN on Yahoo Finance, and both show nothing more trivial blips that don't alter broader trends in stock pricing. So what have we: Fire Phone, iPhone 6 and 6 whatever (the bigger one) and Apple watch. While the hoopla on SA is massive, out in the real world, nobody seems to give a sh** one way or the other whether these product succeed or fail.

    Seems that the real story here is that the "devices" story (whether Apple or Samsung or Amazon or LG or HTC or whoever) is pretty much a yesterday thing. Calculators, color TVs, microwaves, telephone answer machines, desktop pcs, dot matrix printers, inkjet printers, walkman, laptops, VCRs, CD players, DVD players, mobile phones (the big monsters like the one used by Godron Gekko in "Wall Street," clamshall phones, etc. . . . . they all have their day in the sun and then either become superseded or ubiquitous and it looks like smartphones are pretty much getitng there with tablets not too far behind. Asto the watch, who knows. The video phone has actually been around since the 1960s (maybe earleir, I just saw it in the '60s) but it took naelry half a century for it to actually catch on. Not sure how long it's take smart watches, but right now, the apple watch (my reaction to the Jhonny Ives video on Apple.com) seems like a solutuion in search of a problem, and ditto the big payment thing. I'm sure those will eventually become the new normal, but like video calling, I wouldn't hazard a guess as to how long it will take.

    So . . . As to Apple fanboys, continue to knock yourselves out. After termination of Seeking alpha's Yahoo distribution arrangement, I'm sure the company appreciates the ad supported page views you give them, and ad one who uses Seeking Alpha for investment commentary, anything that's good for Seeking Alpha is good for me. So have at it pound those keyboards and debate until you fingers fall off.

    As to those actually interested in investing, take your positions in device companies, however large or small you want it to be, and then, get yourself a decent stock screener -- I'm biased as to which one, check my profile :-) -- and find other things to look at.

    DISCLOSURE: I have and use an iPad, a Samsung Galaxy Note phone, a Kindle Paperwhite and 7" Fire, and a Lenovo Yoga 2 Win 8.1 laptop, and of course, a Dell Win 7 desktop. So I see them all use them all and love them all fully cognizant that each is best at something different and sucks at other things.
    Sep 10 10:09 AM | 1 Like Like |Link to Comment
  • Herbalife: Who's Consuming All Those Shakes? And Why... [View article]
    Here's my question to you (and it gets to the heart of why Christine's research rings true for me): I want to try a Herbalife shake. How can I get my hands on one? I have never seen a club or any other place where I might walk in and buy one. I went to the Herbalife web site and am told the products are not sold in stores but only through distributors; fair enough. How can I find a distributor? The only option the web site gives me is to input my name and full contact info. I don't want to give my contact info. I don't want to hear about becoming a distributor (I am gainfully employed and have no time or inclination to deal with that.) I just want to try the product.

    So here it is. I am a consumer, nothing more. I want to try the product. Please give me SPECIFIC information as to how I can do so. I'm in Queens, NY. That, and the direct message capability of Seeking Alpha, should be more than ample as contact info.
    Sep 10 09:35 AM | 3 Likes Like |Link to Comment
  • Herbalife: Who's Consuming All Those Shakes? And Why... [View article]
    "Read Reuter's independent reporting: http://reut.rs/1weUXKR

    Why would Reuters not tell it like it is? "

    Having worked at Reuters and being familiar with Editorial (although I didn't work in that group), I beeive they mean well and would not deliberately slant anything. But my recollection is that the journalists were a unionized, bitter, badly paid, overworked, thoroughly demoralized group that devoted more energy to trying to find better jobs before the ones they had were eliminated or outsourced to India. I could easily envision them messing up a complex story like HLF because they didn't give a sh** and/or didn't have the time or resources to investigate as fully as necessary.

    Actually, I thought much of the HLF coverage to date in Seeking Alpha ranged from ludicrous to downright idiotic to self-dealing sleaze. This one, however, was a highly informative exception.

    Yes, I get it that she was commissioned by Ackman and I do think Ackman is so tuned into the folks at HLF because it takes one to know one. That said, he, too, has a right to hire a private researcher and in our presently pathetic excuse for a regulatory environment, he also has the right to turn her loose when he needs an extra jolt down for his so-far disappointing short position. (Given that Ackman commissioned the research, does anybody doubt that he ordered her to send it to SA?) But what the heck, sometimes unpleasant people still do good work. Wagner was a magnificent composer although a Nazi-sympathizer, and ditto Theodore Drieser, author of brilliant "realist" novels. And let's get real, even the much worshiped (on SA) Steve Jobs was a rotten husband, a pathetic father and a generally bad person. So I see no reason why an Ackman-commissioned research effort can't be first rate.

    I think the reason this research worked for me may have something to do with me living very close to the area in Queens where she conducted it, and her descriptions of the venues, the people and the local Hispanic community ring very true. And frankly, if HLF is really selling to consumers, why the heck is it that I have absolutely no clue how I might buy some to try? I get that it's not at CVS, GNC, Walgreen's, etc. (MLM marketers always whine about how "they" don't want the products distributed becasue the establsihed vendors are afraid of competition -- it's really a cute script.) But in this part of Queens, that is absolutely positively no excuse for lack of clear-cut distribution to regular consumers. Everything and anything gets sold here, if not through standard channels than through abundant selections of non-standard channels. Applying the basic occam's razor principle ("among competing hypotheses, the one with the fewest assumptions should be selected") I accept the notion that HLF products aren't available to regular consumers in my area becasue HLF has no interest in making them avialable to regular consumers.

    I've long been on the fence about HLF. But this is the first thing I've seen on SA or eslewhere that I find persuasive. So now, I'm bearish (but not short becasue I still don't care enoough to deploy capital).
    Sep 9 06:21 PM | 6 Likes Like |Link to Comment
  • Apple's iWatch Profit Potential [View article]
    "Editor's Note: This article discusses one or more securities that do not trade on a major exchange. Please be aware of the risks associated with these stocks."

    Dear editor. I have suggestion for an added disclosure:

    Editor's Second Note: This article discusses and analyzes a product that does not exist. Please be aware of our embarrassment at having approved it for publication. We apologize for any inconvenience you experienced in clicking on the article.
    Aug 22 09:59 AM | Likes Like |Link to Comment
  • A Different Take On A John Galt Portfolio [View article]
    "What about the Dumbledore portfolio? He liked his sweets, so I'll kick things off with HSY. "

    Hector V,

    I know you meant this tongue-and-cheek.But I have to tell you, I really enjoyed writing this.

    I'm not a Harry Potter fan so a Dumblesore of portfolio wouldn'do for me. But if you want to become a contributor, that could be a cool idea. I'd love to see more fun angles. Everybod and his brother does a Warren Buffett portfolio (and if you hunt far enough back in my previous articles, you'll see I'm guilty), but after tackling John Galt, how about, hmm, perhpas an Alex Portnoy portfolio, or a Simon Cowell or better yet, a Howard Stern portfolio!
    Aug 19 09:00 PM | Likes Like |Link to Comment
  • A Different Take On A John Galt Portfolio [View article]
    Shane,

    You are correct in observing that there are high PB stocks that don;t have G-Scores. Data availability is always a challenge in quant work. Sometimes, it involves a necessary item a company doesn't report. And in a model like this, where some of the factors require five-year averages, some firms will be eliminated due to lack of adequate history. As you get into this sort of endeavor, you'll find yourself having to make choices, such as allowance for shorter histories in some cases, doing without some factors (as I did with advertising intensity), etc. There are no absolutely right or wrong answers.

    Meanwhile, that was a terrific and valid observation you made about the efficacy of a model like this in its ability to weed out losers. The same is so for the F-Score and a lot of earnings quality models. Generally, investors are conditioned to hunt for winners and beat the market. But there's also much to be said for starting with a ordinary list and then, underweighting or eliminating likely dogs. Data published by Mohanram, Piotroski and Beneish (earnings quality M score) all indicate good potential for that sort of approach, and my own testing based on more contemporary data confirms that.
    Aug 18 12:35 AM | Likes Like |Link to Comment
  • A Different Take On A John Galt Portfolio [View article]
    Who cares? In case you hadn't picked up the hints, I found that part of the book an incoherent mess and frankly, had by that point lost interest in the details. For an expression of the philosophy, I rely on The Virtue of Selfishness.
    Aug 17 01:04 PM | 1 Like Like |Link to Comment
  • Reacting To Earnings Reports: Let's Get Real! [View article]
    Hey Mr. Literacy, I never said Apple was a corporate coward. That comes from Small Pharma Analyst, who articulated the essence of corporate cowardice: "Their main concern is they don't want to come out with a flop since it will hurt their image, so they will take the time and energy to make sure their next innovation is truly ground breaking."

    Will Apple actually have another product cycle? Who the hell knows? I'm not a fanboy so I can't go on blind faith.
    Aug 17 12:04 AM | Likes Like |Link to Comment
  • Reacting To Earnings Reports: Let's Get Real! [View article]
    "When Jobs died three years ago, Apple's revenue was $107B. This year they hit $103B in their first two quarters. I'm hoping you are good enough with numbers to see why that is a good thing. If you need help with that one, just ask. "

    No I don't need help with this one. I hadn't realized that all the $103B in revenue they generated in the first two quarters came from products that had nothing to do with Jobs. I was completely unaware that Tim Cook was such a great innovator. Thank you, thank you, thank you. Where else can one be educated so well as in the Seeking Alpha community?
    Aug 16 06:02 PM | Likes Like |Link to Comment
  • Reacting To Earnings Reports: Let's Get Real! [View article]
    "Their main concern is they don't want to come out with a flop since it will hurt their image, so they will take the time and energy to make sure their next innovation is truly ground breaking."

    Steve Jobs, the driving force behind their magnificent innovation wave came out with flops (Anybody own a Lisa? How about a Next?) and it definitely hurt his image. But hey, that's life. If you're scared of failure or worried about image, innovation won't happen. A culture of corporate cowardice is incompatible with ground-breaking innovation.

    Fortunately, for Apple, we need not worry about corporate cowardice. Jobs is way too powerful for that. Oh . . . wait a minute . . . Jobs isn't with us any more.
    Aug 16 08:49 AM | 1 Like Like |Link to Comment
  • The Misleading Story About George Soros's Filing [View article]
    In journalism school, they teach: "If dog bites man, it's not news. If man bites dog, it's news." Notice that accuracy is not part of the adage.
    Aug 16 08:38 AM | 9 Likes Like |Link to Comment
  • Africa Opportunity Fund: Unappreciated, Underestimated And Undervalued. [View article]
    This is a tough one. I have the soul of a contrarian and did well in the '80s and early '90s with developing market closed ends (especially in Latin America), and I've always thought, regarding Africa, that someday it has to happen. So far, though, I've been right to sit out two decades while others (e.g., China) jumped ahead. Yet even now, I still think of Africa as someday . . . .

    But here are my concerns about your thesis.

    1. I wonder if your contarian spirit owes more to habit than genuine analysis. I've noticed from my own work that contrariansim isn't what it used to be. In this, the information age, we can still disagree with Mr. Market, but we should work harder to do so. We can no longer simply brush Mr. Market off as the manic-depressive ignoramus he was back when Graham first spoke of the archetype.

    2. In terms of a case for Africa, I absolutely positively hate the resources angle. I know it's tempting to see this sort of thing in a positive light. But for reasons that perplex the daylights out of me, history is not supportive. Throughout history and right through the present, for whatever reasons, resource-rich countries are and remain hell holes. Case in point: resource-rich Africa still, even through the industrial and now post industrial age, being remaining on a slow cart to nowhere. Venezuela, Russia, and Nigeria are loaded with oil. Anybody want to pack up and move there? Israel is the only Middle East nation with no oil, and the only Middle East nation with a functional society. South America has resources, yet migration continues to flow north, not south. And it may even be more than just resources and countries. I've been in the business world and have covered stocks for a lot of years and any time I heard companies boast about being "asset rich" (including some I had worked for), mediocrity or worse followed. Darned if I know why this is what it is (maybe I'll become a sociologist in my next life and figure it out); maybe it ha something to do with resources-asset endowment leading to complacency. I don't know. But until I see resource rich countries find a way to stop being losers, I'd rather invest in the resource-poor countries that prosper by exploiting them. And speaking of exploitation . . . .

    3. I also hate the Chinese-investment-in-... And I'm not the only one who hates it. So, too, do the Africans, who are getting sick and tired of seeing China pour so much money into the continent in ways that benefit only China and accomplish nothing worthwhile for Africans. You know the story of the ugly American imperialist who is universally hated around the world? That was Chapter 1. Chapter 2 looks like it's becoming the ugly Chinese imperialist that's hated around the world with the beginning of the chapter set in Africa. Unless the Chinese suddenly start caring (cough, cough) invest in China, not their commercial victims.

    4. Are you worried, though, about Chinese corruption? You should be. Burt Africa is part of the problem, not the solution; check the research and indexes from Transparency International. But at least China has domestic peace (so far). That's still not the case in important parts of Africa. Heck, I'm still waiting for Goodluck Jonathan (President of Nigeria) to figure out he really needs to change his first name to something more appropriate to his populous but still horribly messed up (thank you England) country; perhaps Lifesucks Jonathan.

    5. Finally, there's the trading liquidity of this specific fund and the miniscule size of the continent's financial markets. Oy vey.
    Aug 16 01:13 AM | 5 Likes Like |Link to Comment
  • Africa Opportunity Fund: Unappreciated, Underestimated And Undervalued. [View article]
    You may want to check the "Corruption Perception Indexes" from Transparency International (easy to find by Googling). According to their latest (2013) ratings, most of Africa remains pretty bad in this regard.
    Aug 16 12:45 AM | Likes Like |Link to Comment
  • Reacting To Earnings Reports: Let's Get Real! [View article]
    Magnificent article. Thank you!
    Aug 10 11:25 AM | 2 Likes Like |Link to Comment
  • Is It Wrong To Take A Position In A Stock And Then Write About It On Seeking Alpha? [View article]
    "You should have added a Spoiler Alert, Marc - now we know your protagonist/antagonist gets off"

    No worries; dismissal of the case comes just short of the midpoint. There's a lot more after that.
    Aug 8 05:09 PM | 1 Like Like |Link to Comment
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