The Fed's Private Market Value: Fun With Numbers [View article]
Very interesting article, thanks! I think that one of the key points is the extremely high cost structures of the TBTF banks. Because large bonuses are seen by management as non-negotiable, they either lever up to show decent profitability or stay conservative and get a gentleman's C in financial performance.
Many people are aware that the high cost structures in the auto industry contributed to its problems, but we are only just beginning to realize that the big banks aren't all that great at making money for shareholders either. If they had the pay structure of the Fed, they could be a lot more profitable while taking on much less risk.
How The Presence Of A Moat Makes A Great Investment [View article]
Interesting article. What I wonder is whether having a moat matters the most for investment success, or having more of a moat than people realize. You really have to pay up for companies like KO these days. Also, some moats seem huge right now, but how good are people at predicting moat strength in 5-10 years? FB is valued like the moat will last 2+ decades, which is a very uncertain prospect.
What do you think about XOM's moat? It definitely has competitive advantages, and isn't too expensive right now.
There's been some articles in the popular press lately about kids not having jobs right when they graduate, which is true. But most people with college degree have had them for more than a few months. 29% is worse than Spain, which just doesn't sound right.
10 Demographic Trends Investors Should Be Thankful For [View article]
Kyle, thanks for the piece. Investors would benefit from a greater attention to broader social trends than those studied by financial economists. Here's another positive trend according to the most recent Census data: inner city centers are growing faster than suburbs for the first time in 70 years. The American city is coming back, and it will be populated by a young, diverse, and energetic population with unprecedented levels of education. They will also have unprecedented levels of disposable income because they are delaying marriage (women staying in the workforce) and childbirth (less money spent on overpriced suburban housing and its access to "good schools").
I'm not sure how important the margin interest figures are as an indicator of leverage. There's plenty of other ways to get leverage via derivatives, most of which is invisible to the public. If the author is implying that systemic leverage is propping up asset prices, I don't think that's quite right, we have a lot less systemic leverage than in 2008.
Also, stock valuations are a bit high but nothing out of the ordinary, and the spread between treasuries and junk is about average. So where's the bubble? If anywhere, I believe that emerging market sovereign credit risk is underpriced. Once a generation we forget that lending to developing countries is a risky proposition.
A Safe And A Shotgun, Or Public Sector Banks? The Battle Of Cyprus [View article]
Great article! As long as bondholders keep getting bailed out, they will never learn. If you make a bad bet, you should lose money, not people with savings accounts who didn't want to take any risks.
Chance, you're right about the historical riskiness of ag loans, its mostly the leverage and conflicting mandate that has me worried. If you were CEO, what amount of leverage would you think is appropriate?
I guess only time will tell. I plan on checking back in May or June to see how the companies in this article have changed in price. It will definately be interesting to watch.
I was looking at a quotation from morningstar that matured in 2066, but there's a lot of information is missing on the quote page and I'm not sure that morningstar is the best place to go to get preferred stock quotes.
The markets for preferreds, convertables, and bonds are less transparent to a retail investor like me, so I'm not sure if I can offer any help. I'd advise being careful, though, given the big information asymmeties between the big boys and the little guys in these markets. You may be better off with a preferred CEF or mutual fund where you can leave the execution to profesionals.
New Low, thanks for the comment, definately food for thought. While I think that volume measured in shares is important, so is volume measured in dollars. AAPL's volume has gone up with its market cap in the long run. If AAPL did a 10:1 split, share volume would go up, but would that have changed how AAPL's fall influenced the prices of other companies in the industry?
The Fed's Private Market Value: Fun With Numbers [View article]
Many people are aware that the high cost structures in the auto industry contributed to its problems, but we are only just beginning to realize that the big banks aren't all that great at making money for shareholders either. If they had the pay structure of the Fed, they could be a lot more profitable while taking on much less risk.
How The Presence Of A Moat Makes A Great Investment [View article]
What do you think about XOM's moat? It definitely has competitive advantages, and isn't too expensive right now.
A Safe And A Shotgun, Or Public Sector Banks? The Battle Of Cyprus [View article]
10 Demographic Trends Investors Should Be Thankful For [View article]
http://bit.ly/13igYy2
There's been some articles in the popular press lately about kids not having jobs right when they graduate, which is true. But most people with college degree have had them for more than a few months. 29% is worse than Spain, which just doesn't sound right.
10 Demographic Trends Investors Should Be Thankful For [View article]
Synthetics Rise From The Dead [View article]
Amazon Beats Apple On This 'Buffett-esque' Metric, But It Still Faces Headwinds [View article]
There Is No Asset Bubble? [View article]
Also, stock valuations are a bit high but nothing out of the ordinary, and the spread between treasuries and junk is about average. So where's the bubble? If anywhere, I believe that emerging market sovereign credit risk is underpriced. Once a generation we forget that lending to developing countries is a risky proposition.
A Safe And A Shotgun, Or Public Sector Banks? The Battle Of Cyprus [View article]
Farmer Mac Is Too Risky [View article]
AIG Catalysts Could Cause Shares To Surge [View article]
Where The Money Fleeing Apple Went [View article]
Where The Money Fleeing Apple Went [View article]
Why Protective Life Is A Buy [View article]
The markets for preferreds, convertables, and bonds are less transparent to a retail investor like me, so I'm not sure if I can offer any help. I'd advise being careful, though, given the big information asymmeties between the big boys and the little guys in these markets. You may be better off with a preferred CEF or mutual fund where you can leave the execution to profesionals.
Where The Money Fleeing Apple Went [View article]