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Mike Maher  

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  • The Spanish bad bank plan is released: The first wave of purchases will total €45B (with €90B being the final sum). Purchases will include foreclosed assets, loans, land - all at severe discounts to face value. Land, for instance, will get a 79.5% discount. Yikes. Rajoy expects private investors to mostly fund the scheme, and aims for ROE of about 15%. [View news story]
    Discounts like that must have been what the PE execs have been talking about in terms of opportunities in Spain.
    Oct 29, 2012. 12:48 PM | Likes Like |Link to Comment
  • As Exxon (XOM) falls behind in discovering untapped oil fields, it may be forced to buy what it cannot find, some analysts say. Anadarko (APC) could be an M&A candidate because utilities from Singapore to Seoul would pay a premium to import gas it finds off Mozambique’s coast. EOG could rejuvenate XOM with its oil-rich reservoirs in the Eagle Ford shale in Texas. [View news story]
    Moving the needle with a big acquisition didnt work well with Range Resources. I think XOM, or any of the majors for that matter, will see better returns by going after smaller names that lack the funding and infrastructure to really exploit the acreage they have, and go from there. XOM could pick up 3 or 4 companies and get a huge foothold in the Bakken, Utica, or DJ Basin, bringing the money and expertise of a major. I agree it won't be game changing for XOM, but the company made $41 bil in 2011, so its going to be hard for any deal to move the needle significantly.
    Oct 28, 2012. 11:40 PM | 1 Like Like |Link to Comment
  • Gold will be at $5000 in two years, and that may be the low end of the range, claims Peter Schiff. Granted, we've already seen a spectacular run in the yellow metal over the past decade, but it's going to accelerate even more from here as the pace of inflation begins to pick up. Not only that, but the government continues debasing the dollar faster and faster, so gold logically has nowhere to else to go - but up. (video[View news story]
    No, neither my undergraduate or graduate professors teach conspiracy theories about the exchanges suppressing metal prices. My college did teach me that a recession is two consecutive quarters of negative GDP growth, so since the last 13 quarters have seen positive growth, we are, by the definition of the word, not in a recession. The fact the US has not been in a recession for the last three years is a fact that every economist, pundit, author, and personality I have heard agrees with, so I don't understand how you can claim we never left the recession.

    I'm not even sure what vaults you are referring to being short on the worlds gold, since neither the the US nor EU currency is backed by gold.

    Of course banks wouldn't flood the market with foreclosures if they could help it, since in a foreclosure they are the sells, they would try to get the best price. In judicial states, like NJ, the courts are so backed up with foreclosures that the process is moving much slower than in non judicial states. In judicial states, new foreclosures will continue to come to the market, and prices will be weighed down by this slow drip of foreclosures. Its how the individual states designed the system, not the banks.

    The austerity thing, I agree with you. The US needs higher tax receipts and significantly less spending going forward, and these will both weigh on growth. I'd argue that growing energy production and exports will help offset the the hit to GDP, as lower energy prices make the US more competitive, and exports of oil and nat gas help the trade balance.
    Oct 26, 2012. 11:57 PM | Likes Like |Link to Comment
  • Gold will be at $5000 in two years, and that may be the low end of the range, claims Peter Schiff. Granted, we've already seen a spectacular run in the yellow metal over the past decade, but it's going to accelerate even more from here as the pace of inflation begins to pick up. Not only that, but the government continues debasing the dollar faster and faster, so gold logically has nowhere to else to go - but up. (video[View news story]
    I'm from NJ, I know a thing or two about corrupt politicians, but if you both don't believe in any of the numbers anyone produces, why invest in anything?

    IT, listen to you? All you've said in this whole thread is buy gold, and that my school doesn't teach me that MANIPULATION exists. I'm assuming when its in all caps and not in a sentence its somehow different than regular manipulation, maybe that's why I can't wrap my head around it?
    Oct 26, 2012. 09:40 PM | Likes Like |Link to Comment
  • Gold will be at $5000 in two years, and that may be the low end of the range, claims Peter Schiff. Granted, we've already seen a spectacular run in the yellow metal over the past decade, but it's going to accelerate even more from here as the pace of inflation begins to pick up. Not only that, but the government continues debasing the dollar faster and faster, so gold logically has nowhere to else to go - but up. (video[View news story]
    Private equity firms have trillions in assets, and consumer credit is $2.7 trillion. You can't ignore certain purchases or assets because you don't like them. PE firms buying previously owned homes doesn't even contribute to GDP directly, since GDP only measures what final goods were produced, not the value of all transactions.
    Oct 26, 2012. 09:33 PM | Likes Like |Link to Comment
  • Gold will be at $5000 in two years, and that may be the low end of the range, claims Peter Schiff. Granted, we've already seen a spectacular run in the yellow metal over the past decade, but it's going to accelerate even more from here as the pace of inflation begins to pick up. Not only that, but the government continues debasing the dollar faster and faster, so gold logically has nowhere to else to go - but up. (video[View news story]
    A recession is defined as 2 consecutive quarters of negative GDP growth. Considering that the numbers today show GDP growth at a 2% pace in the third quarter, and the numbers have all been positive for the last 13 quarters, I find it hard to believe that not only was the current GDP number overestimated by 2%, but that not a single well respected economist has noticed we are currently seeing a contraction in GDP.
    Oct 26, 2012. 08:37 PM | Likes Like |Link to Comment
  • As Exxon (XOM) falls behind in discovering untapped oil fields, it may be forced to buy what it cannot find, some analysts say. Anadarko (APC) could be an M&A candidate because utilities from Singapore to Seoul would pay a premium to import gas it finds off Mozambique’s coast. EOG could rejuvenate XOM with its oil-rich reservoirs in the Eagle Ford shale in Texas. [View news story]
    I think it would make more sense to go after several smaller US names with lots of acreage and drilling locations, because XOM could drill faster, and with a lower cost of capital.
    Oct 26, 2012. 05:59 PM | Likes Like |Link to Comment
  • Growth And Income: The Blackstone Group LP [View article]
    Blackstone's Q4 dividend varies based on how much distributed income is left over from the prior three quarters. This makes the yield higher than just assuming $0.40 a year in distributions, although it also makes it harder to quantify.
    Oct 26, 2012. 04:45 PM | 2 Likes Like |Link to Comment
  • Gold will be at $5000 in two years, and that may be the low end of the range, claims Peter Schiff. Granted, we've already seen a spectacular run in the yellow metal over the past decade, but it's going to accelerate even more from here as the pace of inflation begins to pick up. Not only that, but the government continues debasing the dollar faster and faster, so gold logically has nowhere to else to go - but up. (video[View news story]
    Thats not what I meant to say, detto, although apparently its the impression I gave. My point was that there are as many numbers pointing towards looming deflation as there are pointing to a rapid increase in inflation. The fact that the Fed printed so much money, and yet inflation did not increase out of control, leads me to believe that their actions, along with TARP, stopped a deflationary spiral similar to what happened in the Great Depression.

    Along those lines, increases in gasoline and food prices are more tied to increases in global demand than they are in a decrease in the value of the dollar caused by the fed. The fact that lots of these exports leave the US to go to China points to their currency manipulation as also causing increases in the prices Americans pay, in addition to the extraordinary increases in the amount of dollars the Fed is pumping into the system here.
    Oct 26, 2012. 12:18 PM | Likes Like |Link to Comment
  • Gold will be at $5000 in two years, and that may be the low end of the range, claims Peter Schiff. Granted, we've already seen a spectacular run in the yellow metal over the past decade, but it's going to accelerate even more from here as the pace of inflation begins to pick up. Not only that, but the government continues debasing the dollar faster and faster, so gold logically has nowhere to else to go - but up. (video[View news story]
    GDP is growing at 2%, and hasn't been negative in years. By definition, we are not in recession. It is by no means a strong recovery, or adequate recovery to improve the economic lot of most Americans, but its not a recession. At the $40 bil a month or so the Fed is adding, it'll be another 50 months before we add another 2 trillion. That would mean another 4 years of sub-par growth. I think we can both agree we don't want that.
    Oct 26, 2012. 09:11 AM | Likes Like |Link to Comment
  • Gold will be at $5000 in two years, and that may be the low end of the range, claims Peter Schiff. Granted, we've already seen a spectacular run in the yellow metal over the past decade, but it's going to accelerate even more from here as the pace of inflation begins to pick up. Not only that, but the government continues debasing the dollar faster and faster, so gold logically has nowhere to else to go - but up. (video[View news story]
    Case Shiller back to levels not seen since 2003.

    http://bit.ly/P7bL4m

    The percentage of after tax income being spent on food, energy and financial obligations (ie mortgages) matches the low on record going back to the 80's. http://on.wsj.com/SCmYI4

    Wages are not rising, home prices likely have another few years in most markets before stabilizing, and oil consumption is falling, not rising, as production in the US sets multi decade highs. The us has the lowest oil prices anywhere. Gasoline prices are higher because we are exporting record amounts of gas and diesel, but home heating costs and electricity costs are falling, as cheap natural gas changes those markets. Food prices spiked before the Fed started printing money, thats a supply and demand issue that has nothing to do with the fed. Inflation should run, on average, at about 2-3%. The Fed has added $2 trillion to its balance sheet, and hyperinflation hasnt set in. If the $2 trillion in made up fiat currency didn't do it, what will? They wont print another $2 trillion, Bernanke wont be at the Chair that long.

    My point was that hyperinflation isnt on the table.
    Oct 26, 2012. 01:15 AM | 2 Likes Like |Link to Comment
  • The Libor probe widens, reports the WSJ, with state subpoenas having been issued in August and September to 9 additional banks. Among the lenders receiving subpoenas are Bank of America (BAC), Credit Suisse (CS), Lloyds (LYG), and Royal Bank of Canada (RY). [View news story]
    Between 16 and 18 major banks were reporting Libor rates at that time. 16 subpoenas were issued. Seems like a normal part of the investigation.

    http://econ.st/UJIcZk
    Oct 25, 2012. 09:47 PM | 1 Like Like |Link to Comment
  • Gold will be at $5000 in two years, and that may be the low end of the range, claims Peter Schiff. Granted, we've already seen a spectacular run in the yellow metal over the past decade, but it's going to accelerate even more from here as the pace of inflation begins to pick up. Not only that, but the government continues debasing the dollar faster and faster, so gold logically has nowhere to else to go - but up. (video[View news story]
    Home prices in the US are falling, energy prices are falling, the U-6 measure of unemployment is above 15%, and rates on US government debt are at all time lows. That does not paint a picture of rapidly rising inflation. Falling prices and a slack labor force point to deflation, not inflation. That's the reason the Fed can print unlimited amounts of dollars and the world hasn't fallen apart yet, its because without the fed printing as fast as the machines can go, we'd be looking at pretty sharp deflation in most of the world.
    Oct 25, 2012. 09:11 PM | 3 Likes Like |Link to Comment
  • China's apparent oil demand climbed 9.1% Y/Y last month to an average 9.8M bbl/day, the highest on record, according to a Platts analysis. The rise marks a rebound from a 1.5% contraction in August to 8.95M bbl/day, which was the lowest since Sept. 2011. "September's strong refinery runs and rise in net oil products imports suggest underlying demand was fairly stable" in Q3. [View news story]
    Likely building up reserves as prices decline.
    Oct 25, 2012. 06:21 PM | Likes Like |Link to Comment
  • Seeing "real opportunity" in Spain's battered property and financial services sector, KKR co-founder Henry Kravis says his company is putting money to work there. Curiously, Kravis made the comments in Singapore, where his firm is opening a new office and aggressively raising money. Wilbur Ross previously[View news story]
    I'd be more concerned with the Euro remaining where it is vs the dollar over the next decade, rather than trying to pick a bottom in Spanish real estate. The article says they are looking at financial services as well, which seems high risk, but potentially high reward.
    Oct 25, 2012. 11:42 AM | Likes Like |Link to Comment
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