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  • What's Driving Markets Today? [View article]
    Thank you for the kind words. Simply put, there are far too many individuals benefitting from the government's largesse be it directly or indirectly without paying their fair share into the syste. This is unsustainable and most unfortunate for individuals like yourself.
    Jun 30, 2011. 03:11 PM | Likes Like |Link to Comment
  • What's Driving Markets Today? [View article]
    By extension of the market's existence there is no market timing strategy that works consistently. Did you consider how the market acted when you made the various bets and that your returns may be largely beta driven, making you the beneficiary of good fortune?

    I suggest identifying long-term trends and investing steadily over time; you will sleep better!
    Jun 30, 2011. 03:09 PM | Likes Like |Link to Comment
  • What's Driving Markets Today? [View article]
    Outside the scope of this article I agree with you and my bias is towards inflarion. Prices have gone up, and Bernanke is clearly targeting inflation to reduce the real value of the debt. These new developments with Bill Gross talking about rate caps, etc. is particularly damning for the dollar and the deflation camp.

    However, I think we must at least acknowledge that economic fundamentals are extremely weak and show no signs of material improvement.
    Jun 17, 2011. 12:38 AM | Likes Like |Link to Comment
  • What's Driving Markets Today? [View article]
    How do you propose to miss the worst 100 days or only catch the best 100 days? The last two bullet points are interesting but irrelevant to the argument for or against market timing. I suggest reading the piece sourced at the bottom of the chart.

    The Ivy Portfolio demonstrated some success with the use of moving averages, but was largely about asset allocation and non-correlated return streams. And I believe their MA demonstration did not account for taxes or transaction costs, no?

    Their study focused on two endowment funds which have an indefinite horizon and are tax exempt, two advantages individual investors do not posses. Also, due to their scale, their ability to access hedge funds, private equity funds, and unique real estate opportunities further differentiates them from retail investors.
    Jun 17, 2011. 12:26 AM | Likes Like |Link to Comment
  • Safe Yield From the Corporate Sector [View article]
    I agree with your thoughts on the credit structure of the portfolio. Though I would point out that it is the distribution yield which signifies the income realized by investors in the fund. The distribution yield is composed of coupon income and realized gains. The gains are generated as a function of the manager's stated objective to minimize tracking error, and despite headline risk high quality bond yields remain subdued and tax losses may not be available to wash out gains.

    Also, though a separate discussion, I am sure you and I could find a number of the "lower quality issuers" with far stronger balance sheets than the money center center banks and the implicit government guarantee standing behind their debt.
    Jun 16, 2011. 09:52 AM | Likes Like |Link to Comment
  • Safe Yield From the Corporate Sector [View article]
    The yield to maturity would be more accurate if the fund holds the securities to redemption. That is not the case. Also, the average yield to maturity does not account for deploying the proceeds from one bond sale/redemption to a new position.
    Jun 16, 2011. 08:43 AM | Likes Like |Link to Comment
  • PHYS: Another Golden Choice for Investors [View article]
    The convertibility feature of (PHYS) is interesting and intuitively it should trade tightly to the spot price but it doesn't for some reason. Perhaps there is something I'm missing???
    Jun 9, 2011. 01:54 PM | Likes Like |Link to Comment
  • The Case for Apartment REITs [View article]
    I agree that current valuations are lofty and an investor looking for an entry point should wait for a significant pullback. That being said, the weak economy does not allow renters the flexibility to buy. While they may move somewhere else due to a rent increase, they are still renting and thus contributing to the demand side of the equation. There is some weight to the household consolidation/"move in with mom and dad argument," but we are still seeing a net increase in the number of renters and vacancies declining at the end of the day.

    As construction stagnated in the midst of the crisis, we are several years away from meaningful supply increases. The bargaining power will not be on the side of renters until single family home prices decline another 20%+.
    May 20, 2011. 06:41 PM | 2 Likes Like |Link to Comment
  • The Case for Apartment REITs [View article]
    While I agree (as is widely accepted) a rise in the level of prevailing rates (often associated with inflation) will drive the cost of capital and thus the hurdle rate north, I would contend that top-down factors may drive income proportionately higher over time. As rising interest rates also impact the affordability of single family homes, such an environment would create more renters by necessity.

    In any event I would like to see a pullback of 20% before considering a purchase. The entire REIT complex seems a bit too high given the huge bounce from the lows in '09.

    May 20, 2011. 05:32 PM | 1 Like Like |Link to Comment
  • Four Overvalued S&P 500 Stocks to Avoid [View article]
    Why is it wrong to assume rental growth will reach unprecendented levels in light of the fundmental story at play? Few people are credit worthy enough to buy and even fewer have the cash on hand for a 20% - 30% down payment to top it off. With real economic growth remaining anemic in the U.S., there will no upward pressure on wages or an improving employment market for many years. Long story short, many people will be forced to rent. Furthermore, those fortunate enough to find themselves in a financial position to buy may be scared away by the extremely poor liquidity still plaguing residential real estate.

    This is not to mention that single family housing is a break even investment at best when prices levels over the past century are discounted for taxes, interest (even deducted), and maintenance/utilities. Who knows what will happen when Americans began to analyze a home purchase objectively rather than emotionally?!

    Look forward to hear your thoughts on AVB.
    May 18, 2011. 04:41 PM | Likes Like |Link to Comment
  • Interview: Jim Rogers on Long Agriculture, Short Bonds and ... Soccer [View article]
    To be sure, the ghost cities are clear indicator that real estate is overpriced in China. Those price levels must come down substanitally to promote widespread affordability for the middle class.

    However, those ghost cities were largely constructed with cash/savings rather than leverage. Therefore we should not see the same destruction of lenders' balance sheets that we saw in the U.S., which could limit the overall damage.
    May 11, 2011. 04:01 PM | 2 Likes Like |Link to Comment
  • 9 Critical Questions Investors Must Consider [View article]
    On the Eurozone; while I agree the relative size of those economies is insignificant, the ECB and member nations are commiting real money to the problem, in the hundreds of billions of dollars, which could be troublesome down the road. Because of the poor economic scale of the PIIGS and their inability to devalue their currency/debt directly, they could become a black hole for financial resources.

    I also agree the U.S. is in every bit as much trouble if not more. But due to our economy accounting for 25% of global GDP and owning the world's reserve currency we can continue on in this fashion for some time, for better or worse.

    As for the banks, I think the best thing we can do as investors is not capitalize them by purchasing their bonds, common, and preferred. Let's face it, we're already capitalizing them with our tax dollars!
    May 10, 2011. 10:29 AM | Likes Like |Link to Comment
  • 9 Critical Questions Investors Must Consider [View article]
    Without question these financial reporting shenanigans are criminal. Particularly upsetting is the absurd bonus/compensation issue when the government backstops their losses with taxpayer money.
    May 10, 2011. 10:21 AM | Likes Like |Link to Comment
  • Thoughts on the Silver Crash [View article]
    You could be right; without question the long-term trend is still up. Though I do think there is some weight to the argument that the (formerly) elevated price levels brought some metal to the market in the form of recycling, etc.
    May 5, 2011. 04:25 PM | 6 Likes Like |Link to Comment
  • Thoughts on the Silver Crash [View article]
    Excellent point.
    May 5, 2011. 04:23 PM | 4 Likes Like |Link to Comment