Ramesh Rangaswamy's Instablog Ramesh Rangaswamy http://seekingalpha.com Fiscal Cliff Worries Will Force Down The Market To Crash.. http://seekingalpha.com/instablog/132256-ramesh-rangaswamy/1335441-fiscal-cliff-worries-will-force-down-the-market-to-crash?source=feed 1335441 The capitalism that the companies want to follow is to borrow as much money as possible and distribute it to shareholders and owners of the company this year when the dividend income tax is 15%. Starting from next year, for a continued N number of years until the tax rates are favorable, they will be paying interest on the borrowed money and hence see no profits.

Today [[ORCL]] have accelerated their dividend payments, and many companies like Apple(AAPL), Panera(PNRA) and Michael Kors Holdings Ltd (KORS) will follow suit..

I believe stock market will crash if tax rates are increased and will continue to be down. It is called rigging the game or gaming the Government.

Everyone wants to play the game. Taxpayers, Government and the companies. Some win and Some lose.. You choose who you want to be..

]]> Mon, 03 Dec 2012 18:25:21 -0500 The capitalism that the companies want to follow is to borrow as much money as possible and distribute it to shareholders and owners of the company this year when the dividend income tax is 15%. Starting from next year, for a continued N number of years until the tax rates are favorable, they will be paying interest on the borrowed money and hence see no profits.

Today [[ORCL]] have accelerated their dividend payments, and many companies like Apple(AAPL), Panera(PNRA) and Michael Kors Holdings Ltd (KORS) will follow suit..

I believe stock market will crash if tax rates are increased and will continue to be down. It is called rigging the game or gaming the Government.

Everyone wants to play the game. Taxpayers, Government and the companies. Some win and Some lose.. You choose who you want to be..

]]> aapl Stocks The Math Of Stock Market Crash And Governments Borrowing Timing, GS http://seekingalpha.com/instablog/132256-ramesh-rangaswamy/700361-the-math-of-stock-market-crash-and-governments-borrowing-timing-gs?source=feed 700361 IF you remember last year in September, out of the blue Job Numbers came out so bad and media started warning of double dip.. Markets went down 600 points and many Blue Chip stocks were down more than 5% in one day, despite SEC had promised that they had controls in place to prevent stock crashes..

Then in 1-2 months everything became normal and there was unbelievable rally for next 6 months

With the Government debt being so high and even borrowing from foreigners and central bank at 3.5%-5.5% is a huge burden to the government, compared to selling treasuries at 1.5% or negative interest rates.

From the late part of 2008 to this date, Banks borrowed from FED at almost 0% and bought treasuries that yielded 3.5%. It was an easy job. That is when the media and the Government bragged about recovery and stuff.They had tightened lending due to loses from people unable to pay the debt and this was a sweet deal for them to make money despite not lending.

I believe that the Government has learnt to deal with customers(foreigner investors) directly selling treasuries at 1.5%. They recently announced that China could buy treasuries directly instead of going through Wall Street Firms. I have a sense of doubt about the governments direct dealing.

Let us see the news head lines lately...

China growth slows..

US Job numbers slow

stock market slows/ crashes and investors want safe heaven

They go and buy US treasuries at 1.5%

They even pay German Government money to park their money, Since Germany pays -.09 %..

This could be one or two reasons along with Greece/Spain mishaps

If the stock markets are going high why would any one want to buy treasuries at 1.5 %. All they had to do is scare the heck by bringing job growth numbers out and flexing it to their convenience .. They could continue this for a few months while accumulating job numbers to give a pre election 3 months surprise. JPM ,Citi Group(C) Goldman Sachs (GS) are reeling in their lows and no one want to touch them due to fear. This feels like a game of Governments and Banks.

Disclosure: I am long [[VXX]].

Additional disclosure: I have bought VXX stock @ 17.x, sold covered Call options for higher prices and also bought a VXX Put. Kind of a straddle...Buy and sell based on the swings..

]]> Sat, 23 Jun 2012 00:42:13 -0400 IF you remember last year in September, out of the blue Job Numbers came out so bad and media started warning of double dip.. Markets went down 600 points and many Blue Chip stocks were down more than 5% in one day, despite SEC had promised that they had controls in place to prevent stock crashes..

Then in 1-2 months everything became normal and there was unbelievable rally for next 6 months

With the Government debt being so high and even borrowing from foreigners and central bank at 3.5%-5.5% is a huge burden to the government, compared to selling treasuries at 1.5% or negative interest rates.

From the late part of 2008 to this date, Banks borrowed from FED at almost 0% and bought treasuries that yielded 3.5%. It was an easy job. That is when the media and the Government bragged about recovery and stuff.They had tightened lending due to loses from people unable to pay the debt and this was a sweet deal for them to make money despite not lending.

I believe that the Government has learnt to deal with customers(foreigner investors) directly selling treasuries at 1.5%. They recently announced that China could buy treasuries directly instead of going through Wall Street Firms. I have a sense of doubt about the governments direct dealing.

Let us see the news head lines lately...

China growth slows..

US Job numbers slow

stock market slows/ crashes and investors want safe heaven

They go and buy US treasuries at 1.5%

They even pay German Government money to park their money, Since Germany pays -.09 %..

This could be one or two reasons along with Greece/Spain mishaps

If the stock markets are going high why would any one want to buy treasuries at 1.5 %. All they had to do is scare the heck by bringing job growth numbers out and flexing it to their convenience .. They could continue this for a few months while accumulating job numbers to give a pre election 3 months surprise. JPM ,Citi Group(C) Goldman Sachs (GS) are reeling in their lows and no one want to touch them due to fear. This feels like a game of Governments and Banks.

Disclosure: I am long [[VXX]].

Additional disclosure: I have bought VXX stock @ 17.x, sold covered Call options for higher prices and also bought a VXX Put. Kind of a straddle...Buy and sell based on the swings..

]]> gs jpm c Financial Government borrowing at lower rates In Search Of Real Headline News http://seekingalpha.com/instablog/132256-ramesh-rangaswamy/759871-in-search-of-real-headline-news?source=feed 759871 5 headlines for the last 2 years:

1) Investors Shrug Off Euro Crisis,Stocks rise

2) Investors Sell Greek Fears, Markets fall

3)Stock rise on hopes of Fed Stimulus

4) Markets sell off, disappointed at Feds feeble attempts

5) Fears of Double Dip, Stocks fall and Investors Seek safe Haven, Government sells 100 Billion in Treasuries

Are there any news media like Seeking Alpha which will shed better light giving investors a different view.

]]> Tue, 19 Jun 2012 17:52:13 -0400 5 headlines for the last 2 years:

1) Investors Shrug Off Euro Crisis,Stocks rise

2) Investors Sell Greek Fears, Markets fall

3)Stock rise on hopes of Fed Stimulus

4) Markets sell off, disappointed at Feds feeble attempts

5) Fears of Double Dip, Stocks fall and Investors Seek safe Haven, Government sells 100 Billion in Treasuries

Are there any news media like Seeking Alpha which will shed better light giving investors a different view.

]]> c gs vxx faz GMCR could see wild swings, good for a straddle game http://seekingalpha.com/instablog/132256-ramesh-rangaswamy/82777-gmcr-could-see-wild-swings-good-for-a-straddle-game?source=feed 82777 GMCR has outperformed for the last 3 years. Now that the sales could be seen slowing I am taking both sides using options. They are reporting earnings soon, so I have taken a straddle of 29 Put and 30 call.

  They have done many splits in the last 2 years so they don't want the stock to look too expensive.  Some times it is numbers and sometimes it is percentages.

  At P/E of 55, if any signs of growth seems to be slowing again, we could see this at $21... On the other hand if they can still show consistent growth, we can see this soon at 35. With a straddle and a high swinger, we may definitely win.. I know it is an OxyMoron statement, but that's the way the market now is...



Disclosure: hold options 29 Put and 30 Call]]> Tue, 20 Jul 2010 15:05:03 -0400 GMCR has outperformed for the last 3 years. Now that the sales could be seen slowing I am taking both sides using options. They are reporting earnings soon, so I have taken a straddle of 29 Put and 30 call.

  They have done many splits in the last 2 years so they don't want the stock to look too expensive.  Some times it is numbers and sometimes it is percentages.

  At P/E of 55, if any signs of growth seems to be slowing again, we could see this at $21... On the other hand if they can still show consistent growth, we can see this soon at 35. With a straddle and a high swinger, we may definitely win.. I know it is an OxyMoron statement, but that's the way the market now is...



Disclosure: hold options 29 Put and 30 Call]]> Coffee Retail Euro Zone could see a lot of Travel, Could be good for airlines http://seekingalpha.com/instablog/132256-ramesh-rangaswamy/66502-euro-zone-could-see-a-lot-of-travel-could-be-good-for-airlines?source=feed 66502   The reason for Germany to keep Euro lower beyond PIIGS problems, could be many. If the Euro is down against Dollar, it implicitly will be down against Chinese Yuan. They can sell a lot of their cars to the Chinese who just recently surpassed US in car buying. With the Yuan rigged, to the Dollar and the chinese economy being hot, even the Chinese might see a lot of benefits in Euro travel.
  With Euro being down, I see lot of people planning trips to Europe, since the dollar is strong comparitively. Most airline companies I believe must have bought hedges during last year to protect themselves of the rise in oil prices.
 If they have bought the oil contracts/ hedges for the next 5 years at last year prices, we should see the airlines doing very well despite the price in oil.
 I think it will be good to go long on Euro banks/ airlines and companies who export to the USA.
  I also think to short US/ Chinese (ADR) stocks that exports to Euro countries..
  Chinese airlines could be a buy... ZNH, CEA
 

Disclosure: No positions]]> Mon, 03 May 2010 16:24:27 -0400   The reason for Germany to keep Euro lower beyond PIIGS problems, could be many. If the Euro is down against Dollar, it implicitly will be down against Chinese Yuan. They can sell a lot of their cars to the Chinese who just recently surpassed US in car buying. With the Yuan rigged, to the Dollar and the chinese economy being hot, even the Chinese might see a lot of benefits in Euro travel.
  With Euro being down, I see lot of people planning trips to Europe, since the dollar is strong comparitively. Most airline companies I believe must have bought hedges during last year to protect themselves of the rise in oil prices.
 If they have bought the oil contracts/ hedges for the next 5 years at last year prices, we should see the airlines doing very well despite the price in oil.
 I think it will be good to go long on Euro banks/ airlines and companies who export to the USA.
  I also think to short US/ Chinese (ADR) stocks that exports to Euro countries..
  Chinese airlines could be a buy... ZNH, CEA
 

Disclosure: No positions]]> nbg cea znh airlines banks Euro MA can see 10% Swings in next 1 Month. Take advantage!!! http://seekingalpha.com/instablog/132256-ramesh-rangaswamy/31904-ma-can-see-10-swings-in-next-1-month-take-advantage?source=feed 31904 MA It has wild rides. Every time there is news about defaults there is huge swing in MA, V and COF.
  If you have seen the trading this mastercard stock, you could be in for big gains both the ways. This is an ideal candidate for swing trading. Especially now that it's at it's 52 week high, I am expecting it to retrace it to $200 and back to $240 - $250 range after earnings...
  But then again, the stock market is under the blessings or curse of the Fed. Anything can happen... Make money for your honey... Or risk loosing one..LOL... Just kidding....
]]> Fri, 16 Oct 2009 16:31:14 -0400 MA It has wild rides. Every time there is news about defaults there is huge swing in MA, V and COF.
  If you have seen the trading this mastercard stock, you could be in for big gains both the ways. This is an ideal candidate for swing trading. Especially now that it's at it's 52 week high, I am expecting it to retrace it to $200 and back to $240 - $250 range after earnings...
  But then again, the stock market is under the blessings or curse of the Fed. Anything can happen... Make money for your honey... Or risk loosing one..LOL... Just kidding....
]]> ma v cof gs jpm