Zachary Scheidt

Blackstone: Benefiting from Improving Economic Trends

Squeaky,

While I can't argue with your experience - I don't know who you work for or what type of oversight Blackstone offers - the company has a very strong track record of turning companies around leading to profitability. BX could certainly play the "smoke and mirrors" game for a time, but if this were to occur, investors would balk at purchasing IPOs coming out of BX. Eventually the plan would backfire.

While the situation is certainly not perfect, Blackstone actually offers economic benefit, and the returns are very lucrative - for the company AND for the investors.

Thanks for the comment...

zachstocks.com

Loans to Congress: The Untold Debt Story

Thanks for the comments guys - while there are so many different opinions on how to "fix" our system, the excessive borrowing from future generations is incredibly concerning.

To quote Bill Bonner, "It's not just immoral. It's fundamentally wrong - and mean - for one generation to spend the next generation's money."

zachstocks.com

At the Bull-Bear Crossroads

The volatility is certainly picking up (both on positive and negative days). That has me trading smaller and managing risk more carefully. But it also seems to point to "churning" where investors are skittish and could very easily be convinced to throw in the towel and send markets lower.

I'm particularly concerned when looking at charts of major indices - noting that the small cap and higher risk indices have very decidedly broken their uptrends, while the Dow and to some extent the S&P is still hanging on. It seems the appetite for risk is diminishing which will initially hit the small cap growth sector, but in time should erode into the blue chip universe.

I'm picking up short exposure and yes it has me nervous. I'm one who got my hand slapped late this summer as well, but the risks are in full force. Beginning to build short exposure slowly and will pyramid as confirmation and profits accumulate.

zachstocks.com

Blackstone Group: Recovery Marches On

It was impressive to see BX retaking it's 50 day on strong volume. I'm drinking the kool aid for now - the opportunity to liquidate positions at attractive levels should still be available, how else can you explain the popularity of the Hyatt deal?

The business model follows a "heads we win, tails we break even" as the company basically allows investors in its funds bear most of the risk while the potential for incentive allocations can be tremendous.

zachstocks.com/2009/11.../

I'm bullish - holding in the ZachStocks Growth Model - and own $15 calls personally.

Sentiment Overview: Surprising Increase in Optimism

Optimism re-entering the market should provide some fuel for bears (myself included) as eventually the frustration will likely cause these weak hands to fold.

However, we need to watch retail figures carefully. If a positive market and investor optimism leads to consumer spending for a quarter or two, it could stall the eventual downturn in the market. I don't think the consumer has much dry powder even if he IS optimistic as lines of credit are being pulled and unemployment continues to rise. But we should be aware of this potential and initiate short positions carefully with risk control.

zachstocks.com

New Oriental Education and Tech: An Expensive Short Opportunity

woohooo!!! the recession is over! I guess we're out of the woods now despite the fact that unemployment is continuing to rise, wages are falling, credit lines are contracting, credit defaults are rising, construction loan defaults are increasing, government debt issuance is huge and consumers are hunkered down and saving.

As I said, any GDP growth in Q3 will be a result of government spending and not a truly sustainable economic rebound. I'm still in that camp and expect the long-term recover to be much more difficult than many analyst predict.

zachstocks.com

Can Gold Go Even Higher?

Looking at a longer-term chart for both gold and silver, it's clear that we are not anywhere close to a speculative bubble. Gold is moving in a relatively predictable fashion based on its multi-year base and until we get a 30 or 40% move above the breakout in a few months time there is little reason to worry about a bubble.

Silver is in an even better technical spot as we are still working off the selling pressure from 2008. I would not worry about significant resistance until we approach $20 and even that would likely be short-lived. Remember, silver is consumed where as gold is largely placed in vaults. Expect silver to outperform over the coming months

zachstocks.com/2009/09.../

Flash Trading Drives Profits, Unseating Established Competitors

As an AMTD customer, this actually works to your favor. They are not allowed to take a fill that is worse than the national best bid or offer. So if one of these parties can execute at a better price than you will immediately be filled. Otherwise it goes out to the entire market.

Since I'm NOT an ameritrade customer I should be complaining :-)

zachstocks.com

KKR Financial: A Specialty Finance Opportunity

you guys got me on the typo. I'm amazed there aren't more of those as I type fast and proofread faster... My apologies to Roberts

We certainly could have some issues with defaults, but other positions will turn out to be better than expected. That's why the portfolio gets marked to market.

It's too bad the positions aren't liquid enough to short. Otherwise there would be an arbitrage situation and the stock would immediately approach NAV.

Thanks for the comments guys,
zachstocks.com

Athenahealth: A Reluctant Short

I haven't heard the CEO speak, but can say from everything I have read that their company is strong. That's why I'm actually torn - believe in the company but not in the stock.

CGP: I'm not sure that this would be a positive catalyst. We've all see the "buy the rumor, sell the news" scenario played out and this could be a similar situation. Everyone is expecting another push for universal health records, and once we get it the traders move on to the next opportunity. Timing is the hardest part of this trade, but The danger appears to be imminent.

Thanks for the comments guys!
zachstocks.com

I'm Slowly Rebuilding My Chinese Position

I hear they've got some great research reports for slow market days :-)

Oh well, good thing i'm not sensitive


On Sep 01 01:25 PM TraderMark wrote:

> p.s. not sure why you got 2 negative thumbs up. You didnt pump iamned.com
> did you?? ;)

I'm Slowly Rebuilding My Chinese Position

Excellent timing on the sell Mark,

I do think you'll get that chance to buy China significantly cheaper but like your strategy of legging into it slowly. Up to this point in 2009, we have seen buying of every dip and while I stay awake at night wondering what will happen when no one is left to buy the dip, the larger trend is still higher.

This morning we're seeing some news about commodity buying again from China - Do you see a split Chinese market where hard assets are driven higher as the China reserve banks continue to build positions - while at the same time many equities associated with China business come under more pressure?

The Yuan peg will also be a huge factor as foreign exchange balances appear tedious. Many question marks surrounding China investments.

zachstocks.com

Blacklist Grows for Troubled Banks

Burton A. J - because they would immediately move from "troubled" to "failed." No one wants to do business with a troubled bank. The entire system is built on trust and if you know first hand that a bank is troubled then it is only a matter of time before depositors pull out leaving the bank insolvent.

Ray - I agree with you mostly. The issue is not necessarily that we need MORE regulation as much as we need to require adequate disclosure. If banks were required to show just how ugly their balance sheets were (bring all those skeletons out of the closet and open your book to the public), there would no longer be an incentive to act irresponsibly. Consumers could easily see who were the stalwart banks and the market share would increase. Being responsible at this point would be akin to being profitable. Instead of heavy handed regulation, we need to properly align the incentives so that responsible business practices are rewarded, not discouraged.

Thanks for the comments guys,
zachstocks.com

Chart Industries Rides the Natural Gas Trend

Good information guys - Thanks!
zachstocks.com

Oil Inventory Report Fuels a Market Rally

Rohan - Are you trading via futures markets? Any stock or ETF suggestions for some readers who might not have access to these markets?

Mmarrkk: I'll go back and look harder. But sometimes discipline means taking advantage of opportunities even when competitors are pulling in the horns. Discipline works both ways - discipline to produce within your means, but also discipline to continue producing when opportunity is there, but fear of risk is shutting down peers.

long_on_oil - I think the cuts in production were a result of FALLING prices as many projects made no economic sense at low NG prices. As we see these prices rise, production will increase. This is how the equilibrium of supply and demand work.

Toobad41- agree that Congress cannot set prices. Unfortunately they can influence them however, and can shoot us in the foot by placing trading restrictions. Do keep in mind that if 75% of oil is imported, the importers have a vested interest in keeping the prices high. So to offset that it would be wise for us to open up reserves we have set as "off limits" and also develop a more robust alternative energy platform.

Thanks for the comments guys! Come visit zachstocks.com when you can for more updates and energy insights.