Ricard

Wal-Mart Executives: There Are Families Not Eating at the End of the Month

"It will not be too bad this year. Both China and America are addressing bubbles by creating more bubbles and we're just taking advantage of that. So we can't lose."

Amazing quote.

Regarding the article, equally, if not more amazing.

Samsung Sees Record Profits

Samsung becoming subject to the law of large numbers:

online.wsj.com/article...

Will There Be New Lows in 2010?

Great article.

I like your perspective on agri-commodities. Lot of truth in that spoilage theory.

Grantham also thinks we'll have a correction next year amid good news about the economy, although he is nowhere near saying something like 'testing new lows'. I think Edwards is being a bit excessive here.

Maybe we'll have a 'stealth correction' involving inflation and monetary debasement. That seems like the likeliest outcome, IMHO.

3Com Wins Big Deals in South Africa and Brazil

You could have written this article 6 years ago - 3Com partners with foreign up-and-comer, 3Com has a strong balance sheet, 3Com blah blah potential...

The difference? 3Com now has less than 1/3 the cash and 1/2 the book value of what it had then.

Look at how this stock has done in the past 8 years. Extrapolate.

The Unsustainable Lie of Inflation

BTW, I am continually perplexed by people insisting that the gold standard is salvation.

The way I see it, it's a matter of integrity, and whether or not it's tied to a yellow metal with nearly zero utility is irrelevant.

Bottom line, if fiat fails, so will gold. Guns, ammo, water, and dried food will rule the day. Of course, in a sense, they already do.

The Unsustainable Lie of Inflation

1.
D - a commodities basket.

2.
B, although they may not create bubbles if there is accompanying inflation (i.e. goods become fairly priced at a higher nominal level)

3.
D - none of the above - stocks are fairly valued (maybe a bit over-valued), unless inflation makes A) come true.

4.
A - a broken clock is right twice a day.


On Nov 10 03:53 PM Paco Ahlgren wrote:

> Here's a little quiz:
>
> 1. What is the best gauge of coming inflation?
>
> A. Government statistics.
> B. Gold.
> C. Your knees start aching.
>
>
> 2. What happens when the government prints money and creates low
> interest rates?
>
> A. Ben Bernanke starts crying.
> B. People buy lots of stuff and create bubbles.
> C. Jesus returns.
>
> 3. When the price of gold is hitting multi-decade highs (in real
> terms), at the same time the stock market is gaining 35% in value,
> this likely means:
>
> A. Stocks are obviously undervalued.
> B. People are confusing gold for cocaine (easy mistake).
> C. Jesus issued a proclamation that "Gold is great. Gold is good."
>
>
> 4. When all the "smart" people on CNBC are saying, "Yay! Stocks are
> going higher! It's all better!" This is:
>
> A. Representative of reality.
> B. Stupid.
> C. Yet another opportunity to imagine Erin Burnet wearing a cheerleader
> outfit and waving pom-poms.

Zimbabwe as an Investment Destination

Scottrade doesn't use the option symbols - they go by underlying ticker, strike price, and expiration. I only wish more firms would do the same.

Buffett's Aversion to Gold Could Cost Him

"Fifteen years of blood, sweat and tears from the greatest investor in the world and he just breaks even with gold, which “just sits there and eats insurance and storage and a few things like that.” And still he recommends avoiding gold."

Look at the ten years following. Just because gold and oil had bubbles during your fifteen year period does not mean that it outperforms when those bubbles deflate.

You could make the same argument taking choice time periods of any asset class and comparing it to Berkshire Hathaway, and say something like 'look, Buffett was off his rocker during that time period'. Such an argument would be as unsound as the argument presented in this article.

WSJ.com Could Lose 25% of Its Traffic if Murdoch Blocks Google

This move makes sense.

As it stands, Google basically controls media content by making all the money from it, while publishers like WSJ and the NYT make next to zero (outside of their own advertising streams).

A corollary would be for phone books to make the profits that would normally go to the plumbers and etc that actually perform the service. Doesn't make any sense.

Of course, wsj.com makes a tidy sum off the outlandish $150/year subscription fee.

Industrial Production Is Growing but Where Are All the Products Going?

Excellent article. I got curious as to how much of the stimulus went to autos. This AP article cites a 72% yoy increase:

www.google.com/hostedn...

Richard Koo Discusses Japan's Lost Decade and the U.S.

1) My bad, apparently he is Taiwanese.

2) I don't think anyone has noticed that this video is already one year old (10/29/08, not 2009). He's still talking about Bernanke pondering lowering rates and the administration debating the stimulus package. Regardless, thanks for posting it.

3) His theories would also explain why China's economy is humming along, given the enormous size of their stimulus relative to their GDP. I suppose the question would then be whether or not they collapse in the future, or further their own stimulus.

Richard Koo Discusses Japan's Lost Decade and the U.S.

Given that Richard Koo is the only Japanese (Korean) economist to speak authoritatively about Japan's economy, I put more weight on his statements and theories than anyone here in the US.

As it stands, we are lucky our problems are not as severe as they are in Japan.

Watching the USD Drop? Here's What You Should Really Be Watching

"And finally, one of the biggest arguments against the USD is countries diversifying their reserves away from US Treasuries. Contrary to popular belief, China does not OWN the US. In May 09, the US owed China (the biggest foreign holder) $772 billion which is only about 6% of the roughly $12.9 trillion in total national debt. Any attempts to diversify could just be a ripple in the ocean, a ripple that might just hurt the lenders more than the debtor."

Good perspective...good reality check. It is easy to get carried away with all of the China bashing in the US.

Washington's Problem Is Poor Economic Solutions

"If you want to deleverage the banking system, do that, but don’t drown the banks in liquidity. Instead run the bad boy and troubled banks through FDIC or similar proceedings that scrape off their bad debt, along with their stockholders, bondholders and management, and then sell them off to new buyers for fresh and balanced starts."

At least with Citigroup, it seems the govt is taking this advice through 'similar proceedings'.

Stocks Soar, Unemployment Rises, Dollar Slumps

While I am sympathetic to the overall tone of this article, I do not see a solution.

China's standard of living is much, much lower than ours. What that equates to is that they are able to produce as much while making do with much less. I'm not sure if 'adjusting' their currency would lead to a different outcome, although I do find it interesting that this mode of thinking (monetary cure-all) is exactly what our politicians have in mind for our economy.

Jobs will continue to go overseas, and if it's not China, it will be somewhere else. We are just too damned expensive.