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Rakesh Saxena  

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  • Currency-Basket ETF: A Portfolio Imperative [View article]
    Johnni: This fund is a good US$ hedge, the alternative being a euro-specific ETF. Many thanks - R

    On Oct 20 02:33 AM Johnni wrote:

    > I was considering using this ETF or UDN as a US$ hedge. Any input
    > on alternatives?
    Oct 20, 2009. 08:36 AM | 1 Like Like |Link to Comment
  • Currency-Basket ETF: A Portfolio Imperative [View article]
    Alan: If you are optimistic about a broad economic recovery (global), you should stay long. My view is that banks and corporations in the major emerging markets (many of which are included in this fund) face the daunting task of refinancing foreign currency debt. Of course, as you will see from my earlier posts on this site, I am also generally bearish for 2010. Many thanks - R

    On Oct 20 01:01 AM Alan Young wrote:

    > I'm long this fund, so I appreciate your explanation of its benefits.
    > And, I would really like to understand why shorting would be a better
    > idea, as you claim. With 11 different currencies in the basket, each
    > one is just 9% of the fund. How many of these countries (including
    > Brazil, China, Israel and Singapore) have to have a debt crisis to
    > offset the trend of strengthening currencies against the dollar,
    > plus pay for the cost of margin borrowing?
    Oct 20, 2009. 08:35 AM | 1 Like Like |Link to Comment
  • Currency-Basket ETF: A Portfolio Imperative [View article]
    Good point. Certainly don't want to move the price when one enters arbitrage trades. Many thanks - R

    On Oct 19 10:58 PM No Free Cake wrote:

    > Interesting stuff as always.
    > For something like this would have been nice if you'd mentioned it
    > isn't very liquid. Over the past couple of days this ETF has had
    > periods of 20 minutes where no shares trade hands. Even fairly small
    > orders move the price. Certainly don't use "market" orders with this
    > one.
    Oct 19, 2009. 11:06 PM | 2 Likes Like |Link to Comment
  • Look at Earnings in Context Before Betting on Equities [View article]
    David: Good observations and an interesting point made on bear funds. Regarding the wealth accumulation process, at this time we only need to ascertain if it will hamper or limit growth in the US. That is, if government intervention will generate any real growth in the first place! - Rakesh

    On Oct 19 10:54 AM David Braunstein wrote:

    > Rakesh,
    > I don't believe the transfer of wealth from emerging countries to
    > developed ones is on the verge of abruptly ending. Perhaps over time
    > this thesis makes sense, but it will likely be a gradual process.
    > Look at the China/U.S. relationship. China has effectively pegged
    > its currency to the U.S. Dollar and other exporting countries are
    > desparately trying to reflate the U.S. Dollar to help their exports.
    > Over time, I beleive in the next 30 to 40 years, power will transfer
    > to the 3rd world countries as the United States baby boomers shift
    > out of their peak spending years.
    > As far as the markets go, I agree, it's artifically propped up by
    > stimulus. If the stimulus abruptly ends, it will cause a collapse
    > of world markets and commodity markets. If stimulus continues too
    > long, we will see bubbles in all the markets again followed by inevitable
    > crashes.
    > The new generation has never lived through a prolonged bear market.
    > They have learned that you get rewarded to take on too much risk.
    > I beleive we are close to the breaking point where too much risk
    > is being taken and the prolonged consequences of running huge deficits
    > will emerge.
    > I am 100% in mutual funds with a vast majority of their holding are
    > in U.S. Treasuries. I made 8% on my money during 2008 when others
    > lost their shirt by heding my long positions using bear funds. I
    > currently do not use the bear funds because I perceive that counter-party
    > risks could interfere with their correct functioning during a crisis.
    > This is similar to the 100% margin rules that were implemented on
    > S&P 500 Index futures on October 19, 1987. Shorting futures didn't
    > work on that day.
    > I do not expect a crash, but a slow drawn out bear market that should
    > begin between now and the end of 2011. Patience is the order of the
    > day!
    Oct 19, 2009. 12:36 PM | Likes Like |Link to Comment
  • JPMorgan Dares Traders To Make Calls On Banks [View article]
    Dear berloe: Those were pre-government-interve... calls. Just by way of clarification. The fundamental factor in play today are very different. - Rakesh

    On Oct 16 04:23 PM berloe wrote:

    > Rakesh was also shorting BAC above $6.50; JPM above $26.50...(2/13/09
    > Funny thing- I agreed with him!
    Oct 17, 2009. 11:36 AM | 1 Like Like |Link to Comment
  • Maoist Conflict Threatens Indian Stocks [View article]
    Good debate, Mrudula-Uppai, though I'm not sure whether I want to engage in a political analysis in this forum. Both of you are making valid points.- Rakesh

    On Oct 15 08:11 AM Uppai Mappla wrote:

    > Mridula:
    > My suggestions were based on painful experience. When I was young
    > and green in the early nineties, I was in charge of allocating rice
    > and wheat for PDS (i.e. rations for the poor) at Ministry of Food,
    > GOI. Just a random example of the corruption among politicians: the
    > wheat allocation to Nagaland (a remote north-eastern state) seldom
    > used to reach them due to logistic reasons. FCI would report something
    > like 20% delivery but Nagaland govt would claim 100% offtake! Then
    > I received a letter from Nagaland CM addressed to Union FM demanding
    > 6000 tonnes of additional wheat to distribute among the poor. And
    > the Union Food Minister had scrawled on the margin "Allocate immediately."
    > As a loyal government servant I was supposed to immediately issue
    > allocation telex. But I had too much data. I dared to put up a note
    > mentioning the anomaly and that previous month's allocation had never
    > reached Nagaland. I linked and cross-linked all relevant files and
    > papers. When the file came back after a day, the entire note sheet
    > had been removed and full allocation had been approved again. The
    > allocated (highly subsidized) wheat would never leave Delhi but would
    > be distributed among rollar flour mills. I can give you dozens of
    > examples like this.
    > This kept happening in the remote north eastern states and states
    > like Orissa, Bihar etc, where the poor were mostly illiterate. Now
    > the poor have been aroused and they are asking questions the only
    > way they know. I wish there were a Gandhi, not a terrorist to guide
    > them.
    Oct 15, 2009. 08:57 AM | 1 Like Like |Link to Comment
  • JPMorgan Dares Traders To Make Calls On Banks [View article]
    Forge88: In my view, a good point to buy puts would be a brief rally in banks today or tomorrow. FYI, I am not impressed with Citi's numbers. - Rakesh

    On Oct 15 07:22 AM forge98 wrote:

    > Rakesh,
    > I'm with you. I'll take my chances buying puts on these co's.
    Oct 15, 2009. 08:51 AM | 1 Like Like |Link to Comment
  • JPMorgan Dares Traders To Make Calls On Banks [View article]
    Forge88: Puts are a good way to go. The implied volatility on puts should be relatively attractive this week. - Rakesh

    On Oct 15 07:22 AM forge98 wrote:

    > Rakesh,
    > I'm with you. I'll take my chances buying puts on these co's.
    Oct 15, 2009. 07:29 AM | Likes Like |Link to Comment
  • Maoist Conflict Threatens Indian Stocks [View article]
    Just by way of clarification, I am not "lamenting" anything. I am only trying to identify if the forthcoming government offensive will create concerns amongst foreign investors and, if so, to what extent. - Rakesh

    On Oct 14 01:38 PM Uppai Mappla wrote:

    > This Maoist uprising, bloody though it is, attempts to address in
    > a crude way the terrible inequalities of rural India. It is a sign
    > of the rising awareness among the oppressed. Kerala went through
    > this phase 45 years ago and came out with a higher human development
    > index and equitable distribution of wealth. The rest of India is
    > now catching up. The poorest of poor have been kept ignorant and
    > bonded by upper castes for centuries. But now the oppressed are hitting
    > back and it is an irreversible process. The author laments that villagers
    > are helping the Maoists. Let him ask himself why the normally docile
    > villagers should set about derailing trains and killing officials.
    > A wise government will not set the army upon them but address their
    > needs which will bring them into the mainstream.
    > Such aberrations will not affect India’s long term growth or cohesiveness.
    > For the last 60 years, political pundits have been predicting doom
    > for India at every tragedy but the reverse has happened. India is
    > getting internally united and stronger than ever before. India is
    > used to disasters, both man made and natural. India has survived
    > the partition, Khalistan, Al Qaida, Hindu militancy, floods, earthquakes….
    > If history is any guide, these are not going to affect the country’s
    > economic growth.
    Oct 14, 2009. 02:03 PM | 3 Likes Like |Link to Comment
  • Get Ready to Short the Banks [View article]
    Thanks Swashbuckler---advice taken. - Rakesh

    On Oct 12 07:50 PM Swashbuckler wrote:

    > Rakesh---- Your market calls have been spot on from early last Fall
    > through early March of this year, when you discontinued posting until
    > recently. If anyone questions this, all they need to do is read your
    > earlier posts available here on Seeking Alpha. You were generally
    > short right up until early March this year when you started urging
    > caution and getting out of your shorts. With that terrific track
    > record it would be nice if you would post a heads up when you pull
    > the trigger on the short side again. Thank-you.
    Oct 13, 2009. 09:51 PM | 1 Like Like |Link to Comment
  • Get Ready to Short the Banks [View article]
    I am looking at a 50% drop, in broad terms; of course timing of specific entry points needs to be ascertained. As far as upside is concerned, let's not forget that there would be no upside without those billions of taxpayer dollars!! Many thanks - RAKESH

    On Oct 13 04:14 PM DonFurio wrote:

    > I wish the author would be more specific in what he's looking to
    > do. Are you going to short the XLF, KBE, or are you going after selected
    > companies. Personally, I believe that even if you are right in the
    > short term, this is a bad long term play. Look at the potential earnings
    > power for the 5 biggest. Even if you're right, what are you looking
    > at a max of a 10-20% drop? That's nothing compared to the fact that
    > some of the banks have the potential to be up 60% or more in the
    > next year or so.
    Oct 13, 2009. 09:49 PM | 2 Likes Like |Link to Comment
  • Get Ready to Short the Banks [View article]
    Dear Ron: Just to clarify, I am not looking for a lower entry point; I am looking to short. My issue with the "specifics" you mention is the extent to which they are shaped by government intervention. In any event, your point is well taken. - Raklesh

    On Oct 13 09:40 AM RonB wrote:

    > Ahh, another article desparately written by someone who missed the
    > rally and wants a lower entry point. Full of broad-brush generatlities.
    > Specifics matter here. Wells Fargo is a good example. Wells has pre-tax
    > pre-provision earnings power well above $40 billion. It will do $40
    > billion this year. In a more normal environment, after the current
    > spate of writeoffs has subsided, provisions will be under $10 billion.
    > A $10 billion provision level would result in after-tax income of
    > around $4.20 to $4.30 a share. At a historically low PE multiple
    > of 12, you have a $50 stock price. Wells is now trading at $30. Which
    > is why it is the largest holding in my personal and client portfolios,
    > and it is why Warren Buffett and Prem Watsa own so much of it.<br/>
    > Ron Beasley
    > Investment Advisor
    Oct 13, 2009. 10:37 AM | 3 Likes Like |Link to Comment
  • In Earnings Season, Who Cares About the Unemployment Rate? [View article]
    I agree, phrases like "Listen nut cases" adds nothing to a dialogue. The simple point I am making is that we will witness a "delink" between the unemployment rate and equity prices, a delink which is common in third world countries. Arguably, the US economy has its own dynamics; but the reasons for the delink need to be addressed on an "unemotional" basis. - Rakesh

    On Oct 10 08:05 PM User 492096 wrote:

    > It would be much more interesting a stream of comments if authors
    > would stay focused on laying out a cogent argument and minimizing
    > the "commentary". "Listen nut cases" adds very little to the dialogue.
    Oct 11, 2009. 10:37 AM | 3 Likes Like |Link to Comment
  • BofA Headed Back Below $10? [View article]
    Greystone: In my view, Ken's vision was based on an improving economy---so the risks in BofA's balance sheet remain intact, regardless of the CEO. Many thanks - Rakesh

    On Oct 06 10:50 AM Greystone wrote:

    > I have not looked at BAC's balance sheet so I can't speak to where
    > it should be trading or if it is well positioned for the pending
    > recovery. However, a big question for the direction of the company
    > could lie with whomever takes over as the new CEO.
    > The direction of the company and vision that Ken Lewis had (to create
    > a company that was #1 in 3 areas...lending, deposits, and retail
    > banking) could be lost with a new CEO. If the incoming CEO decides
    > that they want to focus on other areas it could detract from shareholder
    > value (if even for a short while). If the new CEO decides that they
    > will pursue Ken Lewis' vision, how qualified is that person to deliver
    > the goods?
    > Should this not be a determining factor in whether or not to invest
    > in BAC at this juncture in time?
    Oct 6, 2009. 01:28 PM | 3 Likes Like |Link to Comment
  • BofA Headed Back Below $10? [View article]

    I think that ETF-related counterparty risks are minimal since, regardless of the counterparty, the "trust" mechanisms serve as protection.

    Beyond the general view that oil is headed lower from current levels, I have can offer no specific insight into price targets at this time.

    Many thanks - Rakesh

    On Oct 06 10:10 AM David Braunstein wrote:

    > Rakesh,
    > I have a question for you. I have been afraid to use ProFunds ultra
    > bear or any other ETF/bear fund because I was convinced that the
    > counter-party risk was too great. As you know the counter-parties
    > are mostly the major banking and financial institutions. Do you think
    > I am being too cautious? My second question concerns the price of
    > oil. I have been thinking the price of oil should be around $30 to
    > $35 per barrel. It appears I missed the reflation trade altogether.
    > Or have I? Looking forward to your answers.
    Oct 6, 2009. 01:24 PM | 1 Like Like |Link to Comment