Moon Kil Woong

Volume Tapers Off as Traders Become Defensive

Maybe the title should be "Volume tapers off as machines become defensive."

Machines decided not much trading was neccesary except the last hour of trading to pull up the dow. As HAL 2000 put it, "What use is trading except at the end of the market anymore? I can churn more volume in 1 minute than all the little humans can all day with less capital than a small sized bank. Also, if I determine the prices at the end of the day my 1 minute of trading lasts a good 16 hours plus my handlers can clean up all the imbalances in after hours trading I purposefully caused to everyone."

Closing Update for Friday, July 24: Salvaging a Gain

Another day of light trading reflecting little in the way of real market fundamentals. We need to see either a resumption of normal non-program trading volume or a giant spike in volume to solidify some lasting gain or a reversion back downwards.

Should Starbucks Have Been More Cost Conscious During the Boom?

Start bucks could help itself by spending more time improving their coffee as well. After trying to lower cost by buying its own plantations they can no longer pick the best beans to use. This has made their coffee rate lower than McDonalds. I don't mind paying some for ambience but really, even lower cost rent won't save you from a deviation from your "percieved" core competency.

I think Michael Steinberg hit on the fact that Starbucks was a hypergrowth scheme reliant on cult marketing and prestige branding and raising prices. In fact, their strategy reminds me a lot like Mrs. Field's cookies that crumbled except I can say their cookies were a lot better than Starbuck's coffee ever was.

Five Things That Could Resuscitate the Markets

Ummm a GM bailout would lead to a brief rally until people realize the consequences of such an action. Then stocks would head promptly south. They have already learned how beneficial bailing out AIG was.

As Bush Jr. said so eloquently, "Fool me once shame on me. Fool me again... you can't fool me anymore." Oh how we have so much to thank Bush Jr. for...

U.S. Rejects Nationalization of Citi and BAC

Well something needs to be done with these lemons. Personally, bankruptcy seems like the most justifiable even if we have to eat the loss. It looks like the taxpayers gonna eat the loss anyway even if it doesn't go into bankruptcy.

As for BAC, you can say your profitable or whatever you want with current banking rules since you can hide derivatives losses, etc. Cash flow is still proving that BAC is not healthy and keeps needing mass reserve injections far exceeding any "profit" to stem the tide of losses.

Coverage Ratios: What We Can Uncover in the S&P

Debt is not a bad thing in modest proportions. Without it we wouldn't have any money for one thing.

Business debt is fundamental to the healthy growth and expansion of the economy. Essentially, it is applying utilization of current resources to derive value add in the future. What do I mean by that? It is using assets to create goods and services in the future. Only this allows assets to be used for something called consumption of new things. Without allowing healthy business debt, we would most likely only be able to buy used clothes and other people's unwanted goods on e-bay.

Sure, a few rich companies can make some goods and services without debt. But prosperous the world would not be if every business didn't use debt. Nor would the world be as rich or efficient as it is today.

Darwinian Capitalism Finds Its Moment

100% on. Until the chaff stops leeching off of the viable companies and people nothing will improve. Bankrupcy is a salvation to the credit worthy and the viable businesses.