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  • QuickChat #239, July 31, 2012 285 comments
    Jul 31, 2012 8:07 PM

    Whew!

    Last QC we saw some very spirited political debate... Given the news and the season, its inevitable that politics will creep into our discussions from time to time. This time it did not drift over into nastiness, though it could easily become personal if we are not careful.

    There seems to be a majority among the center-right group, and a minority center-left. When this sort of issue becomes too unbalanced, feelings are often hurt.

    I understand that many might wish to discuss these pressing political issues, and I would encourage anyone who so wishes to crank up an instablog focused on political issues which impinge upon investments, and let us know its location. For myself I promise to visit and post some Libertarian viewpoints almost guaranteed to annoy both Republicans and Democrats!

    I'd like this QC to be much more focused on investment themes, please.

    I sense the investment tempo to be on the rise, with many fascinating topics bubbling pertaining to both our mining/commodity focus and some major company news. The international investing prospects are more challenging than ever, and we are facing official recognition of widespread recession in the EU over the coming month.

    Now, on with the QC!

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Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (285)
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  • jakurtz
    , contributor
    Comments (1959) | Send Message
     
    I threw up a "Political Quick Chat" for when someone, anyone gets that urge. I feel responsible for getting too much into politics in the QC so I hope this makes up for it somewhat. Have at it politically but not personally.

     

    http://bit.ly/OlnaJj
    31 Jul 2012, 09:06 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    Thank's Jakurtz!
    31 Jul 2012, 10:14 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Nokia up on rumor of Lenovo being interested

     

    Nothing else in the article...but it's on CNBC if your interested.
    1 Aug 2012, 07:23 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Now Lenovo denies interest in NOK... NOK price dropped and is now recovering a bit.
    If there is anything to MSFT's Lumia windows 8 phone ... I would expect to see something soon with NOK.
    1 Aug 2012, 09:03 AM Reply Like
  • SpawnofRobert
    , contributor
    Comments (85) | Send Message
     
    Microsoft is continually late on the hardware scene. They were behind the curve with the gaming platform, behind the curve with the Smartphone rebuild, and are incredibly behind the curve on tablets. Even if the equipment is good (and from what I've seen, it's not all that), they simply arrived to late.

     

    Microsoft's role as the go-to Business Software guru is still going strong, but I think businesses are becoming disillusioned with their Labyrinth-like licensing rules, which make it very business unfriendly to buy. With every new release, they add in a new quid pro quo, change the game, and irritate everybody.
    2 Aug 2012, 10:29 AM Reply Like
  • Jon Springer
    , contributor
    Comments (4073) | Send Message
     
    Thank you TB for the note to focus on investments.

     

    Thank you JAK for setting up a Political QC
    1 Aug 2012, 09:14 AM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    Ditto Jon.

     

    I rarely participate in the political dialogue because more often than not the "debaters" seem to take comfort in finding neat little labels for everyone which somehow makes them feel better about their understanding of how the world works. For my own part -- anyone who tries to "label and box me" into a neat little square would be sadly disappointed because I am all over the political map depending on the particular issue. "Independent" thinking on all fronts is my motto.

     

    Thanks TB for getting us back to an investment focus -- I was starting to lose interest in the last concentrator. :-))
    1 Aug 2012, 09:28 AM Reply Like
  • SpawnofRobert
    , contributor
    Comments (85) | Send Message
     
    I was actually telling somebody on a Wallstreet breakfast that I'd rather discuss things in terms of value and culture. They were labeling one side of the political aisle as people who hate "hard workers" but people I know from that end of the aisle are hard workers.

     

    It's all just a red herring.
    2 Aug 2012, 10:30 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Topic for discussion....I see many mentions of stock splits now, including AAPL. My experience says that I am against this, as it doesn't change anything. Just wasted money on the company part.
    As well as companies usually sell off after a split.

     

    I am thinking at some point we just go flat, Stock splits by mkt leaders would only increase the odds of a more difficult climb higher. This is also coming on top of creative accounting to offset declining revenues.

     

    The only leaders that could replace the current ones, are financials. They have room to double if certain problems were removed or solved.
    1 Aug 2012, 09:27 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    You can also add Coke (KO) to the split list as they split on Aug.11 I think. Breaking up companies is also being tested to unlock value, such as Kraft (KFT) to be completed in the 4th quarter this year.

     

    Some companies would benefit greatly from splitting them up, such as MSFT where the stifle innovation because it doesn't fit with another division with more clout or budget or both.
    1 Aug 2012, 09:52 AM Reply Like
  • optionsgirl
    , contributor
    Comments (5185) | Send Message
     
    Really, LT?
    I love stock splits (except reverse ones). You hold 100 shares, you can buy/sell one option. Your stock split happens, now you have the capability to buy/sell a pair of options. You can sell half your position and the other half is still optionable.
    Reverse stock splits are a form of theft, imo. Your 100 shares becomes 50. You can't hedge with options.
    1 Aug 2012, 10:10 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    I understand ... I have seen companies split one time too many, and then go down and just stay there stagnant...

     

    I did not use selling covered calls, becasue i usually bailed on the run up before the split...

     

    I just meant that if the leaders split and then went down or even flat, it could hurt the market going higher. It is just something to watch and then what sector takes over as a mkt leader.

     

    Economic numbers were not bad today...jobs beat, construction up, Chrysler sales up 13%, manufacturing down.
    1 Aug 2012, 10:42 AM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    OG and LT,

     

    My experience has been that the companies that split their stocks (not reverse splits) have generally continued to climb after the split. The stock becomes more affordable to a larger segment of investors on a round lot basis. This becomes important for those of us who use options to enhance the income stream from our holdings, as OG pointed out. It also just feels good to own 200 shares instead of just 100 shares.

     

    Of course, my experience is primarily focused on large-cap, high quality stocks (like AAPL and KO) and does not include small caps, so I could not consider the impact of splits on the whole universe. My perspective also is formed based upon a long-term view rather than a view of what happens in the next few months or even years after the split. I look at periods of at least five years at a time, so short-term volatility before and after the splits doesn't really matter so much to me. The main purpose of volatility, from my point of view, is that it provides better opportunities from the options traded on the underlying issues at times.
    1 Aug 2012, 10:56 AM Reply Like
  • SpawnofRobert
    , contributor
    Comments (85) | Send Message
     
    This must be why they call you "Options Girl." Do you have a super-hero cape and everything? All kidding aside, I'm not familiar with Stock Splits or Options yet, I'm sad to say. I'm still trying to get the grasp of investing in general.
    2 Aug 2012, 10:31 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Boy Genius (BGR) reports that AT&T (NYSE: T) is telling its retail sales staff to pull back the reigns on the iPhone (Nasdaq: AAPL). Reports suggest management is requesting staff move customers toward Android (Nasdaq: GOOG) phones or Windows (Nasdaq: MSFT), including Nokia's (NYSE: NOK) Lumia 900.
    Also, the actual staff has been no longer permitted to obtain iPhones and must select from other devices...apparently all to give consumers a 'more informed decision'.
    However, other sources suggest that this may not be entirely new news and this process has slowly been taking practice over the past few months.
    News Provided by Acquire Media Corporation
    1 Aug 2012, 12:45 PM Reply Like
  • SpawnofRobert
    , contributor
    Comments (85) | Send Message
     
    I have favored the Android over the iPhone myself for quite some time now, however, I don't think it's a one-size fits all.

     

    I think that people who buy iPhone's for the sake that it's "the phone" to have are silly, and need to do better research.

     

    iPhone is stable, babies it's users, has accessories, but over-regulates programming and apps. This does good things, because it guarantees as somewhat stable app-base.

     

    Android can be somewhat the opposite. As a nerd/techie, I can make my Android practically get up and sing, and it's not locked down so hard core. But if I crash my phone, that's my fault :P

     

    Not sure who uses Windows phones.
    2 Aug 2012, 10:36 AM Reply Like
  • D-inv
    , contributor
    Comments (4778) | Send Message
     
    "Not sure who uses Windows phones. "

     

    :-) May be me. I have no idea whose "operating system" is installed on my mobile phone. As long as it rings/vibrates alerting me to incoming calls and supports both incoming and outgoing voice communications I'm happy. Text messages on occasion are 'ok', but not as a steady diet. For e-mail, web activities I will stick to my desk/laptops.
    2 Aug 2012, 06:11 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    "http://yhoo.it/Nb2raj

     

    Unusual volume and volatility showing up early in several unrelated stocks caused and has resulted in trading being halted on several issues on the NYSE.

     

    Interesting use of words in the article: "consumed with unusual trading that roiled"; "trading like millions of shares, 100 shares at a time, so something went haywire somewhere,"

     

    Molycorp is one of the halted stocks.
    1 Aug 2012, 12:45 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    http://onforb.es/QeVlpy

     

    This is another article about the same situation. More than 150 stocks appear to have been affected.

     

    Another interesting quote from this article: "violent swings in the first hour of trading, and the latter pair were actually halted for moving more than 10% within a five-minute period."
    1 Aug 2012, 12:49 PM Reply Like
  • jhooper
    , contributor
    Comments (8058) | Send Message
     
    "feelings are often hurt."

     

    Just a quick life lesson that is more important than any investing advice. If you can master this lesson, you will accomplish more than you ever thought possible, and will have far less stress than you ever thought possible.

     

    Never give another person the power to insult you.
    1 Aug 2012, 01:49 PM Reply Like
  • H. T. Love
    , contributor
    Comments (19394) | Send Message
     
    "feelings are often hurt."

     

    And a corollary: regardless of that, we all carry the responsibility to interact with minimum respect and consideration for others (and even their feelings), unless they have demonstrated they don't deserve such treatment.

     

    HardToLove
    1 Aug 2012, 03:40 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    Very true. Sometimes I feel like I live on a limb handing other people saws. But I just don't let them get to me so the limb doesn't fall.
    1 Aug 2012, 03:46 PM Reply Like
  • jhooper
    , contributor
    Comments (8058) | Send Message
     
    I live by a lose maxim of..,

     

    "Never be offended, or intend to give offense, but don't let that get in the way of speaking the truth."
    1 Aug 2012, 03:56 PM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    "Always forgive your enemies. Nothing else will annoy them so much."

     

    Oscar Wilde
    1 Aug 2012, 10:58 PM Reply Like
  • jhooper
    , contributor
    Comments (8058) | Send Message
     
    One last thought, and I promise I will leave this alone.

     

    Those that advocate for tyranny and a coercive society, only have an interest in those that they wish to tyranize and coerce to be civil. They will have no interest in respecting other peoples rights, being tolerant, or being civil. When turning the other cheek results in losing your rights, the time for cheek turning has ended. The American Revolution had nothing to do with cheek turning or civility.
    2 Aug 2012, 08:09 AM Reply Like
  • SpawnofRobert
    , contributor
    Comments (85) | Send Message
     
    I thought that was called "Common Courtesy", HTL, but apparently it's about as Common as "Common Sense."

     

    As they say in El Paso, TX: Hijole.
    2 Aug 2012, 10:44 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    The Fed did about what I expected...mkt unsure how it feels. They want to put off more as long as they can. Global CB's are getting too good of results with just meaningless words. Amazing.

     

    Probably setting up the Sept. $600 billion I posted on the last concentrator.
    1 Aug 2012, 02:41 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    The timing would indicate that the Fed is no longer unbiased politically if you are right. I realize that there are probably many indications of this already, but this would be the most blatant example I can remember of a Fed action to prop the economy just before a presidential election.

     

    Maybe I wasn't paying close enough attention previously, but it did seem that the Fed refrained from taking any actions within less than six month before a presidential election took place in the past.
    1 Aug 2012, 03:44 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    IMO, I really don't think the election is a factor. I am sure they would rather be neutral. In this case it is the EZ, not particularly the USA that is the main cause. I think if the fed wanted to sway an election he would move now, as it takes 90 days to kick in. Sure the mkt would go up, but the real kick is delayed. Personally, I don't think a Sept. move would change the election. IMO, I have no idea how / who will win...but I would wager if it was provable that people know who they will vote for and won't change. The way I see it is for months the dems & reps are evenly split at 50/50. The election will be decided by Independents and Non-English speaking population. I doubt this changes between now and Nov.

     

    None of the CB's want to do anything they don't have to. I don't think we see any QE as long as there is growth positive in the US. But I can guarantee all the global CB's are getting a massive amount of cash together to fight off the onslaught of the Euro or EZ that's coming.
    I will bet that hedges are only holding off because they got burnt here before and are somewhat afraid to move to early. They probably know shorts could really get burnt with a global effort.
    1 Aug 2012, 04:28 PM Reply Like
  • optionsgirl
    , contributor
    Comments (5185) | Send Message
     
    That certainly was not the case in 2008, when both the Treasury and the Fed worked feverishly to bring back liquidity into the markets, right up to the elections, imo.
    5 Aug 2012, 02:35 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    I never thought I would see AIG survive.

     

    3:27 AM AIG is looking to repurchase a significant amount of its stock from the government, the WSJ reports, in a move that could reduce the government's 61% stake to below 50% by the autumn but would then bring greater Fed oversight. The Treasury and NY Fed have so far made a profit of $14B on the bailout of AIG, and that could top $18B by the fall. [Financials, Top Stories] 3 Comments
    2 Aug 2012, 05:06 AM Reply Like
  • jakurtz
    , contributor
    Comments (1959) | Send Message
     
    Draghi says, "growth in Euro countries remains weak" -- Is that the understatement of the year? Half the countries are in a recession with double-digit unemployment.
    2 Aug 2012, 08:42 AM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    Yes his comments have created wild swings in DJIA futures -- initially up 90 points -- 10 minutes later down 50 points. EUR/USD swung from 1.2360 down to 1.2280.
    2 Aug 2012, 08:48 AM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    Yep. Reminds of the days when analysts could move the DOW 100 points just from estimating the weight of Greesapian's briefcase...
    2 Aug 2012, 09:00 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    To go along with Jak & MJ... Employment numbers are showing the change in demographics re: baby boomer retirement. 8000 new claims but continuing claims drop lowering the rate. This is the new norm IMO. It will take a year or two to adjust to the new phenomenon.
    This is also supported by the influx of $$$ into yield and income. Huge outflows out of some equity funds is also the new norm.

     

    The big warning from Draghi to me was "countries must be ready to activate the EFSF". This goes along with an article on marketwatch.com that says not matter what Germany wants it too is held hostage and will have to go along.

     

    The CB's are just waiting till the last minute to release their firepower as we spoke of yesterday. Only now it's pretty much published in the press. That is why the shorts have not already attacked the euro.
    2 Aug 2012, 08:57 AM Reply Like
  • jakurtz
    , contributor
    Comments (1959) | Send Message
     
    I agree, I think they are waiting til the last minute. It will be too little too late by that time.

     

    Personally, I am approaching this as an investment opportunity before they announce the stimulus once they announce it it will be time to short the market, imo....errr, but that might be obvious so maybe I will do the opposite, ohh, these head games.
    2 Aug 2012, 09:55 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    You can also add decreased consumer spending to my above posts. Evidenced by retailers like Coach just missing this morning.

     

    Growth likely to be from big ticket items (autos, planes, houses,etc) and corporate spending to update tech & machines.

     

    Consumer debt & more creative loans is not the answer anymore. They have to find a way to get the stimulus into the pocket of the consumer/working man.
    2 Aug 2012, 09:19 AM Reply Like
  • jhooper
    , contributor
    Comments (8058) | Send Message
     
    "They have to find a way to get the stimulus into the pocket of the consumer/working man. "

     

    Taking wealth from one citizen to give to another, whether its from consumers to business or from business to business or from business to consumer, won't create more new wealth. All it does it inflate assets in the class to which the wealth is transferred. The way to play "stimulus" of this type from gov is to analyze the subsidy mix and play the bubble that will be created.

     

    The only stimulus a gov can engage in, is to reduce its oppression, and gov regulation of voluntary transactions is oppression. Its important to understand how these macro policy decisions affect micro circumstances.
    2 Aug 2012, 09:28 AM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    For those who followed the "algos gone wild" yesterday at Knight Trading -- FYI KCG share price is down 68% from its $10 price pre-meltdown.
    2 Aug 2012, 09:25 AM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    Good. Sometimes there is justice in the marketplace.

     

    But in the world of hfts and quants, Knight is a tiny dwarf. Imagine when the same problem occurs with one of the giants...

     

    Its not a matter of "if" but of "when"...
    2 Aug 2012, 09:28 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    KCG is also looking for another means of financing. It's estimated they lost over $400 million.

     

    TB is correct, it's just a matter of time until one of the big ones bite the dust too.
    2 Aug 2012, 09:31 AM Reply Like
  • robert.b.ferguson
    , contributor
    Comments (10491) | Send Message
     
    The difference being how well connected they are. Lehman Failed AIG got bailed out. The question becomes would it even be revealed? My guess is that a cover story would be concocted so investors would never know what really happened should one of the majors have a similar situation occur.
    2 Aug 2012, 10:32 AM Reply Like
  • Jon Springer
    , contributor
    Comments (4073) | Send Message
     
    Saw someone reporting that LODE was caught up in the algo trading gone wild yesterday.

     

    Does anyone know of a smaller (market cap) or lower (share) priced company that got hit by the algorithms yesterday?

     

    (Trying to discern whether there are some companies that are small enough or cheap enough to side step the HFT machine or not)
    2 Aug 2012, 04:07 PM Reply Like
  • optionsgirl
    , contributor
    Comments (5185) | Send Message
     
    Here's a list:
    http://bit.ly/QD82u1

     

    GBG is one of them @ fifty-five cents a share.
    2 Aug 2012, 04:20 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    Thanks for that list OG.
    2 Aug 2012, 04:26 PM Reply Like
  • Jon Springer
    , contributor
    Comments (4073) | Send Message
     
    Hmmm...

     

    GBG is a penny stock (58 cents) but has a bigger market cap than LODE (GBG=300 mill; LODE=120 mill)

     

    interesting diverse list - thanks OG!

     

    (sidenote: Marco G - http://bit.ly/PEbRv9 -was big into GBG last I checked)

     

    I tried guessing a few companies that might be below LODE's $120 mill market cap, but didn't find one... and now I must go change a diaper.
    2 Aug 2012, 04:33 PM Reply Like
  • jakurtz
    , contributor
    Comments (1959) | Send Message
     
    Is it Draghi's? Make sure you wipe down and keep the legs elevated, the EZ got it all over itself this time.
    2 Aug 2012, 05:18 PM Reply Like
  • H. T. Love
    , contributor
    Comments (19394) | Send Message
     
    "and now I must go change a diaper.".

     

    Yep, the market has that effect on me too! >8-O

     

    HardToLove
    2 Aug 2012, 05:35 PM Reply Like
  • optionsgirl
    , contributor
    Comments (5185) | Send Message
     
    GBG and JAG stink, imo. There are plenty of other miners with better fundamentals.
    5 Aug 2012, 02:37 PM Reply Like
  • jakurtz
    , contributor
    Comments (1959) | Send Message
     
    Frist Solar and Power One (PWER). alt energy stocks have jumped from their lows. First Solar just raised its outlook and Power One is a good strong company that supplies inverters and has climbed 30% over the past week from raising its guidance and beating estimates as well. One of these times I will be on the winning side of when to get on a beaten down stock for a short-term gain. Rimm is another one I have been watching, they have a ton of cash ($1.7B) a huge list of patents and trading at $3.8B. I have a target for them of $6.50 which they hit last week but I might wait for a double bottom before trying some.

     

    P.S. I am not suggesting now is a good time for First or Power but interesting watches to learn from.
    2 Aug 2012, 10:02 AM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    I like the Rimm watch, its a buy on my list at $6.42...

     

    PWER has good prospects, medium term, but I worry about them longer term. Short term it's a trade when sufficient volatility beckons...

     

    First Solar is squarely in the middle of the geopolitical squabble. Given the sector rotation out of altenergy by western investors, it has a hard row to hoe, but the geopolitical factor is a door that can swing both ways. If they avoid getting crushed by the massive door, there are opportunities there with a bit of luck. I would treat this one as a "watch" and wait on developments. At least wait until the sector rotation settles.
    2 Aug 2012, 11:19 AM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    Heads up --
    Bristol Meyers BMY down more than 7% after suspending Hepatitis C Drug Study on Serious Safety Issue: http://on.wsj.com/QxqCq3 and now one of their execs is in handcuffs for insider trading http://bloom.bg/OLqzno I added as it dropped below $33 today. Dividend yield of 4.1%.
    2 Aug 2012, 11:11 AM Reply Like
  • D-inv
    , contributor
    Comments (4778) | Send Message
     
    GSK and AZN caught my eye a bit earlier today with their yields (I typically steer clear of pharmas).

     

    I bought a starter position in Pitney Bowes (PBI) this afternoon before Q2 earning report AMC. Dividend yield 11.6% ( :-) if I hold it long enough to collect any dividends).
    2 Aug 2012, 06:36 PM Reply Like
  • jakurtz
    , contributor
    Comments (1959) | Send Message
     
    Spain 10yr back above 7%...again.

     

    Draghi didn't realize his three words "whatever it takes" inferred a bailout package, apparently he didn't notice global markets sky-rocket 5-10% within three days either. The world just misunderstood.
    2 Aug 2012, 02:08 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Jak.. you had a couple of good heads up posts above...I watch solar and also PWER..I traded PWER a bit some time back, but had to triple down on the big drop and was able to bail on a bounce. So I was leery this last time around.

     

    It is just too hard to gamble on solar ... they are all way too cheap, BUT...with the EZ, austerity there and coming here...it's just too hard for me to gamble now. You can't buy a company for fundamentals anymore, it's all waiting for the next political move. I am very liquid right now, and won't gamble on the cheap stocks. As my broker says...they are cheap for a reason. I am watching them tho.
    2 Aug 2012, 02:54 PM Reply Like
  • jakurtz
    , contributor
    Comments (1959) | Send Message
     
    I agree I dabbled in PWER twice as well, and got out by the skin of my teeth. You are right fundamentals and a good business are out the window because they take too long for the market to realize their value and by the time it would the macros have changed everything so much it may just be in the toilet again. Especially, if its in a sector that just happens to be getting picked on that time of year.

     

    ####
    Thanks by-the-way. Now that I have a venting blog to get all my blatherskyping hogwash out of the way, perhaps, my mind will be clear to contribute something more worthwhile here from time-to time.
    2 Aug 2012, 03:32 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    OT...watch AXPW. That fire has potential to really hurt the battery industry as a whole. Now safety will be #1 again, and that could lead to 2-3 years of testing like with BMW & NS. It hurts the entire industry.
    FERC rules are also slowing things down....the two combined could allow competition to gain more traction too. The "just good-enough or Second best choice" is the danger. Time is not on AXPW's side.
    2 Aug 2012, 03:38 PM Reply Like
  • jakurtz
    , contributor
    Comments (1959) | Send Message
     
    Yep, they still have a hill to climb for market acceptance. The insights we have on the supply dynamics and stockholders is a never again situation though. Absolute worst case scenario the company can go into hibernation-mode and be just fine. I am happy with a steady stream of revenue from either LA contracts or PbC, and the world is going to always need batteries and the cheaper more reliable the better. It is nowhere but up for the company from here, although the stock price might continue its schizophrenic personality for a while yet.
    2 Aug 2012, 03:48 PM Reply Like
  • D-inv
    , contributor
    Comments (4778) | Send Message
     
    "That fire has potential to really hurt the battery industry as a whole. Now safety will be #1 again, and that could lead to 2-3 years of testing like with BMW & NS."

     

    Interesting. You may be on target re-the entire industry, but if so I suspect it will be due to Xtreme Power's marketing of its battery as lead based chemistry. I expect to see increased pressure on Xtreme Power for clarification of it's battery chemistry. If something other than lead is adjudged cause/fuel of the fire, isn't reasonable to expect strong demand for FLA, VRLA, Ultrabattery, PbC-VRLA and any other chemistries that are not explosion risks and don't operate at high temps?
    2 Aug 2012, 06:48 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    That is true in the long run, but near term it is another delay and setback. IMO, time is not on AXPW's side. It gives competition more time to develop a just good enough tech cheaper. How many more years can they survive?
    2 Aug 2012, 09:55 PM Reply Like
  • Mayascribe
    , contributor
    Comments (11197) | Send Message
     
    I respectfully disagree. This incident only illuminates how safe and effective the PowerCube is.

     

    The grid build out is a national security situation. Think about what just happened in India! And by 2017, it is expected that somewhere in the vicinity of $150B will be spent in the US alone on making the grid "smarter," operate more smoothly.

     

    This is coming.

     

    One company's failure is Axion Power's gain.

     

    I think this Haruku event pushes Axion forward, not backward.
    3 Aug 2012, 12:42 AM Reply Like
  • jpau
    , contributor
    Comments (960) | Send Message
     
    I worry that politics/lobbying will muck this all up. It might affect how much wind we continue to build out, how much coal we use; and I'm sure the nat gas folks will be lobbying like crazy to burn more of their stuff. I really believe that Axion has a great solution, but our lobbying budget is a worry.
    3 Aug 2012, 08:27 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Let the sell off begin in earnest now (45 min before mkt close).

     

    I would expect a small correction now...say 5% to start with and assess frequently for more.
    2 Aug 2012, 03:18 PM Reply Like
  • jhooper
    , contributor
    Comments (8058) | Send Message
     
    The CBs have disappointed. We will have to wait till Sept.
    2 Aug 2012, 03:44 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    Bought some Cop, Psec, and CLF today.
    2 Aug 2012, 03:48 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Heads up:

     

    Sprint announces it will fight the suit with NY Attny. Gen. office. to collect taxes. I can't post the link.

     

    This could send the stock lower with any further sell off. IMO.
    2 Aug 2012, 04:07 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Buy the Draghi dip ?

     

    http://bit.ly/M6IrJJ
    2 Aug 2012, 05:29 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    This won't help Knight & big investors are leaving, However one analyst says it is still worth $3.50:

     

    http://bit.ly/N1XdRz

     

    There is another Fast money quote on the subject that "electronic tech is wonderful...just hold Knight accountable. Evidently she did not have money in it. But as Herb Greenburg said earlier, it is a public company. Wall St. says it's ok to protect our money even if we lose yours.
    2 Aug 2012, 05:40 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    No one was against this AIG bailout more than me...but it shows how I can be wrong. Just look at these numbers:

     

    -American International Group reports second-quarter after-tax operating income of $1.9 billion, or $1.06 a share, beating the consensus estimate of a 57-cent profit.
    -Maiden Lane III loan from Federal Reserve Bank of New York paid in full.
    -$1.3 billion positve fair value adjustment for Maiden Lane III.
    Insurance income grows 26% year-over-year, to $1.9 billion, after tax.
    and there's more:
    http://bit.ly/MfNkvE
    2 Aug 2012, 06:11 PM Reply Like
  • jakurtz
    , contributor
    Comments (1959) | Send Message
     
    When I think about the bailouts in retrospect it occurs to me that whoever was wealthy enough to buy some of the largest financial institutions in the world for a song should have and should make a lot of money from doing it. The trick was that you had to be big enough to make sure you could keep the thing afloat without total collapse -- the US government and taxpayers were just that size. Now the question is will the taxpayers get a return on their money or will it be soaked up into the nether regions of space.
    2 Aug 2012, 07:18 PM Reply Like
  • optionsgirl
    , contributor
    Comments (5185) | Send Message
     
    JAK, do you remember the sweet deal Warren Buffett struck to help bail out GE? Berkshire Hathaway did very well.
    2 Aug 2012, 07:28 PM Reply Like
  • jakurtz
    , contributor
    Comments (1959) | Send Message
     
    Thats right, I forgot. He also got Goldman Sachs in '09 as well as Burlington Northern during the throws of the crisis and just last year he made a sweet little deal with BAC. Not sure how Burlington is holding up but the other two with the preferred he got I think BRK/A is doing alright.

     

    http://bit.ly/NpaTC1
    2 Aug 2012, 07:42 PM Reply Like
  • Mayascribe
    , contributor
    Comments (11197) | Send Message
     
    jak: And Warren got a heck of a lot of Wells Fargo, too.
    2 Aug 2012, 08:10 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    The taxpayers have made about $17-18 billion on the AIG bailout, and that will just get soaked up (already has been)....but the real point is that the actions have bought time....and time is money. It also saved millions of jobs directly & indirectly. As bad as I hate Bank of America & Citigroup, they will probably come out of it too if given enough time and are able to keep reducing risk thru Credit default swaps. They are just too profitable. It doesn't happen overnight, but each quarter they improve. Look at CitiHoldings (the bad side of Citi) they have reduced them by 2/3. They will be out from under it soon. The EZ is the only risk I see right now that could derail their progress.

     

    Corporations will be here when we are long gone, and the surprise to me was just how profitable they can be now when ran properly. I never thought them or anyone would ever be able to pay back that much. But they have and I am man enough to admit I was wrong.
    I have & did capitalize on the crash and the upswing, alot of the bonds and prefereds I own was bought during all this. They pay very well even today.
    It is examples like this that makes me question some of the bashing we do...time will tell, but history could look back and prove it was the right thing...it's looking more & more that way today.
    2 Aug 2012, 10:12 PM Reply Like
  • jhooper
    , contributor
    Comments (8058) | Send Message
     
    If you spend some time study history, you will find that central banks and gov managed economies are subsidies for existing wealth. A little research will reveal how much influence JP Morgan had on the creation of the Fed Res that came into being in 1914.

     

    He was an investment banker. The more liquidity and capital he had the more deals he could do. A Fed Res (run out of New York, and who was in New York?) gave JP and those in his industry access to the capital of all the taxpayers. And the argument is all the same. "You can't trust markets, because markets cause businesses to fail and people to lose their jobs." Of course what people like JP meant, where his businesses and his jobs. So you sucker the population into believing gov must manage things, and what winds up happening is that existing wealth, like JPs, get subsidized.

     

    So you should not be surprised that companies that get bailed out do well. Fellows like JP and Rockefeller designed the gov intervention to do just that. They tax you to make it so. Your strategy has been correct one. Find the entities to whom the wealth is going to be transferred to, and be their when it gets there.
    3 Aug 2012, 07:15 AM Reply Like
  • H. T. Love
    , contributor
    Comments (19394) | Send Message
     
    LT: It's amazing what "mark to fantasy" can do for a company, no?

     

    FASB-157, IIRC.

     

    HardToLove
    3 Aug 2012, 03:48 PM Reply Like
  • jpau
    , contributor
    Comments (960) | Send Message
     
    Added some more KGN and UAMY today.

     

    Anyone know why gas prices jumped?
    2 Aug 2012, 08:41 PM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    jpau, are you asking about nat gas prices? They've retraced some of the gains from last few weeks. The NYT reported the following re: production (hat tip to iheartbusiness for the posting):

     

    From NY Times:

     

    "Natural gas prices plunged 7.9 percent after the U.S. said supplies grew more than expected last week. The Energy Information Administration reported that natural gas supplies grew by 28 billion cubic feet. The nation’s supply is now 14.5 percent higher than the five-year average.

     

    Natural gas prices had been rising this summer as homeowners cranked up air conditioners and increased demand for gas-generated power. But the government report showed that demand still isn’t strong enough to cut into the country’s surplus of natural gas.

     

    Natural gas dropped 25.1 cents, or 8 percent, to end at $2.92 per 1,000 cubic feet."

     

    Additional details re: production are here: http://bit.ly/MTKEcN
    2 Aug 2012, 10:14 PM Reply Like
  • D-inv
    , contributor
    Comments (4778) | Send Message
     
    "Anyone know why gas prices jumped?"

     

    Because I did not fill up all my auto tanks yesterday?

     

    More realistically, perhaps, two news items today might have imparted some upward impetus - 1) detection of tropical storm strength in a low pressure system headed toward the Caribbean, and 2) saber rattling between Iran, Israel.
    2 Aug 2012, 10:16 PM Reply Like
  • jpau
    , contributor
    Comments (960) | Send Message
     
    Sorry Mercy, I meant gasoline. I was driving home tonight and it looked like premium had jumped 30 cents/gallon.
    3 Aug 2012, 12:11 AM Reply Like
  • Mayascribe
    , contributor
    Comments (11197) | Send Message
     
    Mercy: Semi-related. There is an interesting development going on in PA and Ohio, about drilling shifting from the Marcellus Shale to the Utica Shale (a couple of the comments are pretty good, too):

     

    http://bit.ly/QGtTRj
    3 Aug 2012, 12:59 AM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    Thanks Maya!
    3 Aug 2012, 06:25 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Consensus for jobs at 100,000...some say it's too high, that 60,000 is it. Also that 6-7% unemployment is the new norm at best.
    http://bit.ly/NpU21W
    3 Aug 2012, 04:23 AM Reply Like
  • optionsgirl
    , contributor
    Comments (5185) | Send Message
     
    CME is lowering silver, palladium and platinum margins on Monday.
    That's good news, imo.
    3 Aug 2012, 08:52 AM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    Saw that announcement yesterday OG and agree that is bullish for silver et.al. -- Long SLW. http://bit.ly/NPZAZn
    3 Aug 2012, 09:07 AM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    But not gold, eh?

     

    That figures if the rules are about to change...
    3 Aug 2012, 09:09 AM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    Short video by Jeb Handwerger re: silver production squeeze: http://bit.ly/LSLRB4
    Also his latest article on PMs: http://seekingalpha.co...
    5 Aug 2012, 07:17 AM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    Good info, MJ...

     

    I have started to put together data about current silver production costs. If anyone spots data compilations regarding this topic, post 'em up.

     

    I am thinking that we are seeing a big increase in costs vs those we are used to over the past decade...

     

    Needless to say, this is the sort of scenario which could favor the PM streamers...
    5 Aug 2012, 09:09 AM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    TB, my silver production cost research -- when I decided to add to my long streamer positions (e.g. SLW) -- did not yield good compiiation data -- I just had to look at individual company production data.

     

    A couple of my more interesting finds, however, were:

     

    1) An SA post mentioned this silver producer compliation which has been updated as of 7/20/12

     

    http://bit.ly/MqqLKy

     

    2) Also came across this post which I did think was one way of looking at a back of the envelope cost compilation -- albeit with a margin of error:

     

    http://bit.ly/PXxg2z
    5 Aug 2012, 10:40 AM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    I love the cost estimating routine from SRSrocco! It aligns well with my own (very cynical) viewpoint.

     

    I suspect total silver costs right now are running very close to the market price, if not just above, for the higher cost producers (ie, they are probably operating at a loss).

     

    This tallies well with the squeeze we have seen for miners, where they either see higher silver prices, or start to ramp down production (preparatory to the less efficient going bankrupt or mothballing their operations). With the big falloff in miners using futures to hedge their situations last year (what a non-coincidence given the results of the exchange manipulation which occurred)...

     

    Its a time to be VERY cautious buying the silver miners, right up until the bottom falls out, immediately (and it could happen very quickly) followed by a recognition of a production shortage for silver as the producers are chopped off at the knees.

     

    THEN we see how much silver "appears" in the market from recycling and any odd trading among the exchanges and manipulating entities.

     

    I suspect that we will see a LOT of silver flow into the market from sellers/recyclers AFTER the price bounces, probably back into the $30's, followed by another round of short manipulation and possible exchange rule changes driving margin calls.

     

    It could be a real roller coaster.

     

    At the end of the day I would expect silver to once again be stumbling along the $30 mark, just barely high enough to keep producers in business, while those on both sides of the silver bear/bull divide continue to conduct a flame war.
    5 Aug 2012, 11:20 AM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    Thanks much, MJ. That Candian mine spreadsheet is interesting. I finally figured out that it was really focused on analyzing the "ounces in the ground" for each company. PP% would be "proven/probable" - AG% is self explanatory, the silver % - MI% is "measured/indicated" - while I% is "inferred".

     

    Then the spreadsheet leads one to compare the various amounts of silver each company estimates they are sitting on, and compare it to the share price, etc...

     

    I don't view this as a very good way to evaluate miners (too simplistic for me), but the raw data has a solid value of its own.

     

    Thanks again!
    5 Aug 2012, 11:25 AM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    TB & MJ - I may be over simplistic, but I view silver as a three legged stool: cost of production, amount in the ground, and price (supply/demand determined). Streamers like SLW profit in just about any scenario, it's just a matter of how much. For streamers, the stool has four legs: price, contractual price, estimated contractual production over duration of contract(s) term(s), and annual production by partner miners. Of course, the externals also must be weighed as with any investment. But the long-term value generally smooths much of that out (it's just taking longer in today's environment because of all the manipulation by such big players).

     

    Each piece of the puzzle affects the value of the company as do externals such as those pointed out by TB in his post about cost evaluations two comments above. Great assessment, btw, TB.

     

    I've probably set myself up for a lecture, but hey, additional input is good, respected, and welcome!
    5 Aug 2012, 01:17 PM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    K202,
    I leave lecturing to Professor TB who's a much deeper thinker than I am.

     

    I like your 2 stool construct with the footnote on externals -- not "simplistic" in a bad way at all. BTW you are demonstrating values shared by Leonardo Da Vinci who noted: "Simplicity is the ultimate sophistication." (Sorry it's Sunday when I get more reflective :-))
    5 Aug 2012, 01:51 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    LOL
    (Sorry it's Sunday when I get more reflective :-))

     

    I like that MJ :)
    5 Aug 2012, 02:01 PM Reply Like
  • optionsgirl
    , contributor
    Comments (5185) | Send Message
     
    I agree with you, MJ. I marvelled at how well K202's comparison works. In fact, I think the simplicity is elegant!
    5 Aug 2012, 02:33 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    OG - This is for you:

     

    http://bit.ly/RpEpOR
    5 Aug 2012, 02:57 PM Reply Like
  • Joseph L. Shaefer
    , contributor
    Comments (1715) | Send Message
     
    As long as we're being Sunday reflective, the da Vinci-like quote I have on my desk is from Oscar Wilde: "To do nothing at all is the most difficult thing in the world; the most difficult and the most intellectual." It reminds me to set aside time FOR reflection rather than merely "getting things done." And there's a further benefit germane to this Concentrator: Wilde wasn't thinking of the dangers of over-trading when he wrote those words, but it reminds me daily!
    5 Aug 2012, 03:31 PM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    That's a keeper Joseph. Thanks!
    5 Aug 2012, 03:41 PM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    I quote Oscar Wilde frequently. To me he is the exceptional dissolute libertine whose observations are uniquely valuable to the moral person.
    5 Aug 2012, 07:15 PM Reply Like
  • Jon Springer
    , contributor
    Comments (4073) | Send Message
     
    Questioning unemployment data is creeping up the food chain. Drudge linked this CNBC blog suggesting state numbers are more accurate than the federal numbers (and are much worse):
    http://bit.ly/M8UYMT
    3 Aug 2012, 11:08 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Jon...these are the numbers I was referring to earlier that are changed for my life time...re: baby boomers retiring. It depends on who you ask as to whether the state numbers or fed numbers are more accurate. The last article last week stated that the fed numbers were more accurate. It also points out that many states are now below the National average...such as Iowa only has 5% unemployment. In fact the last I seen was that 27 states are below 8%.

     

    These are the numbers (listed in your post) that scare investors out of the market and miss big days like today. Makes no difference what those U-6 numbers are, the market liked todays numbers.
    3 Aug 2012, 01:29 PM Reply Like
  • Jon Springer
    , contributor
    Comments (4073) | Send Message
     
    Wall Street favors the numbers that push the market up without emotion. If the state's numbers were cause enough for Bernanke to ease, they would be bullish for the market. Its just a game, and I believe we have to go on our own observations to gather accurate data at this point (since all gov't data is more corrupted than Joshua trying to win a game of tic-tac-toe (reference to the movie War Games for those keeping score at home - http://bit.ly/GF2Q73))
    3 Aug 2012, 06:52 PM Reply Like
  • Jon Springer
    , contributor
    Comments (4073) | Send Message
     
    Japan plots to weaken its currency by doing $640 billion of QE for the EU and US...

     

    ooops... I meant to say... by strategically purchasing $640 billion of foreign denominated bonds
    http://buswk.co/QLKMdm

     

    Maybe Zimbabwe had the right idea? if everyone prints money recklessly, the numbers do get wildly bigger fast... we could all be gazillionaires in no time.
    3 Aug 2012, 01:10 PM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    Yep, the BOJ is following its announced game plan, supporting the yen (which for an exporter economy means weakening an over-strong yen).

     

    Watch the yuan for the real action, coming up over the next 2 months...
    3 Aug 2012, 01:31 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    there are two ways the CB's are using to get us out of this mess:
    1. Print money...and probably will for alot longer than we like.
    2. Corporate earnings (just like AIG) paying down debt, refinancing at rates unheard of cheap,..It all adds up over time.

     

    IF only the Feds globally would get this money to the working man, let him finance a house at .25% like the banks are getting money, Give me free money at that rate and I will open a small business or two. I read once where TARP would have been the equivalent of $70,000 per household (not per person) Put a check for $70,000 in every mailbox and the problem is solved. The answer is not more credit from banks to consumers .... getting them back deep in debt to buy things is not the answer.
    3 Aug 2012, 01:34 PM Reply Like
  • DRich
    , contributor
    Comments (4819) | Send Message
     
    >LT ... It's not the job of the world's Central Banks to put money into the hands of the population. That job is either a function of the government or our sainted job creators. Ben has been telling the Congress critters for over a year that it's their turn to do something because he's done just about all the monetary side can.
    3 Aug 2012, 01:42 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    DRich...I agree it's not the CB's job...but it wasn't their job to give free money to the TBIF either, IMO they need to do something big & unprecedented for the people. Such as the .25% mortgage, or a huge one time something, but definately not a stimulus where I get $600 of USA money that the gov't has to borrow and can't pay back.

     

    It needs to be huge, and not just borrowed money to corp's and TBTF.
    3 Aug 2012, 02:08 PM Reply Like
  • D-inv
    , contributor
    Comments (4778) | Send Message
     
    LT ... You mentioned refinancing of corporate debt as an aspect of the Fed's ZIRP policy. That also applies to USG public debt. 'Twas interesting to see 0.125% rate 10 year TIPS auctioned 7/31/12 sell for $107.779 per $100 face amount.
    3 Aug 2012, 03:24 PM Reply Like
  • DRich
    , contributor
    Comments (4819) | Send Message
     
    >LT ... You are wrong about it not being the CB's job to feed money to the TBIF. It was the Treasury that made the decision to save those zombies instead of nationalizing & liquidating the assets. Our central bank would have executing the same monetary policy regardless of who was there it receive it.

     

    I know ... the FED is one hand & Treasury is the other but there are still fundamental differences. It just doesn't seem that most don't understand them (and don't want to). The Treasury picked the players and the FED has done it's job of backstopping the game (system) while we all wait for the referee (Congress, the fiscal side) to take the field, assess penalties & enforce the rules of the game.
    3 Aug 2012, 03:42 PM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    Good program description, DRich. You can't follow the game if you don't get with the program...

     

    I've had some interesting discussions with the odd european attempting to wrap their mind around a national central bank which is actually a quasi private operation with some aspects normally thought of (in more sane countries) as things left to the treasury or an actual "central bank". Of course, they were just as confused as I am when it comes to the byzantine pathways of the EuroZone...
    3 Aug 2012, 04:23 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    D-inv .. I seen that . We have all been watching it and saying that if you can time it, the mother of all trades is to short them. If nothing changes they may hit $1.10. You are also very correct, USA debt interest is a huge thing on $15 Trillion and going higher over the next 4-10 years. They almost have to keep interest low. CD's at the local banks are not less than 1/4 %. Almost any good corp can finance at 1.5-3% now. Many big ones have.

     

    DRich...I am not in disagreement with you either, but both have done unprecedented things starting with the Bush/Paulsen package. I won't go further with politics other than you are right, Congress must do their part. They have wasted enough time. If simple people like us see what needs to be done, I really don't see why they fight doing the right thing for the country bipartisanly. (fix the tax code, end irrational spending, balance the budget no matter what it takes, and then put stimulus where it needs to go, and not for a 6 month deal either. Long term solutions are required in all areas.) Everyone could win if done correctly.
    3 Aug 2012, 07:22 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    TB, the EZ is still a wild card. Germany still resists anything. I think the focus on Greece should be reversed to does Germany want to stay in the EZ?

     

    The way I see it, I don't blame germans for not wanting to take hard earned german money and give it away putting their country in deeper debt for any reason.
    On the other hand, Germany has their cake and gets to eat it too. They have the best economy in the EZ, they are borrowing money at 0 %, while everyone else goes down the tubes. So why change that ?
    3 Aug 2012, 07:26 PM Reply Like
  • DRich
    , contributor
    Comments (4819) | Send Message
     
    >LT ... If I need to explain ... well ... I'll leave it to say Congress is doing the right thing for the people they represent and there exists a certain group that might be inclined to help out the underclass if even greater advantage can be had for the people that count. It is looking like it will stay this way until monetary policy completely collapses trying to do what it can't.
    3 Aug 2012, 07:40 PM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    The real underlying agenda is to create a US of E. Among the German political elite, its the rare truly bipartisan agenda. Among the German bankers...

     

    Well, let's just say they want a US of E where THEY call the shots (and they may ultimately get it).

     

    The one thing none of them wants is to see the Euro go down or the dream of a US of E go with it.

     

    All the fighting is over the fact that the Germans were unsuccessful early on getting the EZ structured the way they wanted it (they correctly predicted that some countries would "cheat", and cause trouble). If the early model of a central bank with an unquestioned audit function (to poke their nose into all those Sovereign tents) had been followed...

     

    Things would be very different now.

     

    LOL, it occurs to me its just the opposite (in that way) from what we need. They needed a central bank that could audit a gang of crooked politicians, and we need a central bank audit which we won't get FROM a gang of crooked politicians.
    3 Aug 2012, 08:46 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    I totally agree that Germany wants to call the shots...I just don't see the rest going along with it. The gamble is that none of them do and Germany gets kicked out and are on their own.
    4 Aug 2012, 06:09 AM Reply Like
  • optionsgirl
    , contributor
    Comments (5185) | Send Message
     
    iran/israel war before nov election?
    check out the article on Komani warning of attack in a matter of weeks.
    http://www.debka.com#
    3 Aug 2012, 01:53 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    I've been expecting to see it any time...It may not be warplanes at first, but something will happen over there...it's just a matter of when not if.
    3 Aug 2012, 02:09 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    It's the key reason I am accumulating oil at this time.
    3 Aug 2012, 08:07 PM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    Me too. I have been trading MRO and accumulating like mad.
    3 Aug 2012, 08:47 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Pretty good article on some Citigroup numbers - IMO part of the big 25% drop could have been Ackman selling 25 million shares to buy more P&G, that leaves room for a nice gain short term if true:
    http://seekingalpha.co...
    4 Aug 2012, 06:23 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    US economy vs. world...

     

    US economy may be better than you think:
    http://yhoo.it/RkZLNe
    4 Aug 2012, 06:41 AM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    I agree with the rise of the energy sector in the U.S. That is undeniable. I also agree that much of the rest of the world is struggling and even China's growth is slowing.

     

    The problem I have with the article is that it is based upon the premise that the U.S. economy is going to grow at 2.5% this year. It slowed to 1.9% in the 1st quarter and has slowed even more in the 2nd. We would have to grow in excess of 3% for all of the 2nd half to average 2.5% for the year. I seriously doubt that it will grow 2% for the remainder of the year. So, all of the "ifs" that the article keeps using based upon the U.S. economy growing at 2.5% this year seem bogus to me.

     

    Don't get me wrong, I believe that there is definitely hope for the U.S. economy. I just don't believe that the strong growth we need is already here. I wish it were.
    4 Aug 2012, 09:00 AM Reply Like
  • DRich
    , contributor
    Comments (4819) | Send Message
     
    >K202 ... A little fiscal policy, properly applied, could easily get the USA economy to 2.5% and I'm not saying tax cuts & austerity or entitlements.
    4 Aug 2012, 09:14 AM Reply Like
  • H. T. Love
    , contributor
    Comments (19394) | Send Message
     
    I'm always concerned when any numbers get reported in nominal dollars rather than inflation-adjusted.

     

    I could agree with the basic premise that we're not as bad off as it seems to many of us, but if the article reported in real purchasing-power terms (i.e inflation-adjusted) I think a clearer and more believable picture would be painted, positive or negative.

     

    Still, a decent summary consideration of the relatively better side of the discussion about our economy.

     

    ardToLove
    4 Aug 2012, 09:34 AM Reply Like
  • H. T. Love
    , contributor
    Comments (19394) | Send Message
     
    Heck, like the folks on CNBC keep yammering - just knowing what the rules are, or will be, might be enough to get business moving enough to financially offset the inertia of our elected body.

     

    Probably a good thing it (likely) won't happen - that would remove the incentive for government to act - little things like getting a budget passed, etc.

     

    Rohm Emmanuel's "Never let a good crises go to waste", while grating on me then and now, seems to have (unintended?) utility by accident - it seems the only way to get the Congressional slugs to actually awaken (slowly, of course) from their self-interested stupor and make an attempt at doing something partially constructive (well, at least less-damaging), hopefully.

     

    But even that hope is fading - did y'all read what the senate spending bill did?

     

    HardToLove
    4 Aug 2012, 09:44 AM Reply Like
  • JeffLeach1986
    , contributor
    Comments (229) | Send Message
     
    I think the key to a turn around of the economy is in manufacturing. The linked chart shows the breakdown of manufacturing by sector in the US for 2010.

     

    http://bit.ly/OQ19F5

     

    You look at the chart and it says that 16 percent of manufacturing in the US involved computer or electronic parts. Seems somewhat suspicious since I find it impossible to build a computer from subcomponents that are manufactured in the US. Most of the parts come from Asia.

     

    I think it comes down to definitions. My mom, who is in her 60s was an accountant for 20 years of her life out in California. When she hit her 50s she quit her job and went to truck driving school. And so started her new career. One of the things she transported across the country was cheese made in California but shipped to Wisconsin. Her outbound cargo from the same facility she delivered to was "Wisconsin Aged Cheddar".

     

    All in how one makes their definitions. So a computer that is sold by Dell may have been mostly built in China, but the final configuration may have been done at a port in New Jersey and possibly counts as a product that was manufactured in the US.

     

    I dont see a rennaisannce in manufacturing in the US until, the wage, OSHA, and environmental stewardship inbalance are addressed. Corporations will choose the most profitable route for the manufacturing needs.
    4 Aug 2012, 10:31 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    You have to watch data that is two years old when making conclusions and decisions.
    4 Aug 2012, 11:00 AM Reply Like
  • jhooper
    , contributor
    Comments (8058) | Send Message
     
    You seem to be talking more consumption subsidies. If so, the way to play these policies moves is to pick up equities at the policy announcement, sell a few months into the stimulus, move to bonds (bullets or callables), then take gains when the consumption subsidy policies end and the recession sets in.
    4 Aug 2012, 12:36 PM Reply Like
  • D-inv
    , contributor
    Comments (4778) | Send Message
     
    "US economy may be better than you think:"

     

    It may, but I find that unlikely while applauding its fundamental plug for optimism. The article, like much of the crappola published, is unreservedly supportive of prevailing U.S. economic policies when there is little basis for doing so.

     

    Oil and gas is a bright spot, not energy per se, and is a bright spot due entirely to private sector creativity, initiative, and willingness to develop privately owned resources. And, that development has occurred despite strong headwinds from the administration and environmental groups. (For example, Interior Department trying to use Endangered Species Act and dunes sage brush lizard habitat to stop continuing production and further development of oil and gas from prolific portions of the Permian Basin.)

     

    Reduction in private sector indebtedness was appropriately noted, but without recognition that a not inconsequential share of that debt reduction was through debt write-offs rather than repayment. Write-offs of mortgage loan, business loans, consumer credit, etc. continue. And, lenders to municipal governments are now joining the ranks of those writing off debt Timing of municipal bankruptcies in part reflects action that belies the article's conclusion - "The big danger in the U.S. remains that the government will fail to attack the debt problem."

     

    Actions by House of Representatives over the past 18 months have attacked the federal government debt problem by seeking reduction in scale of deficit spending and slowing the rate of growth in public debt. The Atlantic' article egregiously implies otherwise, but acknowledges need for more to be done. And that needed more cannot happen without, at minimum, slowing federal entitlement spending growth - something that came close to happening in last year's "grand bargain" budget negotiations but failed due to Democrat opposition to change in CPI index used for social security benefit indexation.

     

    I'll let the article's slap at globalization pass for now.
    4 Aug 2012, 02:54 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Show me one thing the House has done besides:

     

    The passed 171 bills...>60 of them was to name projects

     

    33 votes on healthcare..total waste of time

     

    Blocked the last debt raise until they had to go home with tails tucked between their legs, AFTER they cause the USA to lose it 's AAA credit rating.

     

    Paul Ryans budget puts us deeper in debt than we are after cutting entitlements ... and he is your hero?

     

    They are going to solve all the problems just like you want them too, but yet they can't submit a plan to do so.

     

    Need I go further?
    4 Aug 2012, 03:06 PM Reply Like
  • jakurtz
    , contributor
    Comments (1959) | Send Message
     
    Here you guys go. It has been quiet over here for a while. The new PQC (Political Quickchat)

     

    http://bit.ly/OlnaJj

     

    I would love to jump in and pull some hair but I have barred myself from that behavior here.
    4 Aug 2012, 03:11 PM Reply Like
  • D-inv
    , contributor
    Comments (4778) | Send Message
     
    "Need I go further? "

     

    :-) That statement implicitly assumes you've already gone some distance, to which I ask, You have? Where is it?

     

    Let us continue on Jak's PQC. I'll respond to you there.
    4 Aug 2012, 03:47 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Very good article on mid year "Assessing the mkt"
    http://seekingalpha.co...
    5 Aug 2012, 08:03 AM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    Go Curiosity and the sky crane !!!
    5 Aug 2012, 06:27 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    Knight executes 63% convertible dilution (priced at $1.5) to its shareholders relative to Friday’s closing price of $4.05. Of course, the stock was selling at about $10.25 prior to the "Wild Algo" explanation. $10.25 to $1.50 is an 85% haircut.

     

    But wait a second... If you look at the price action on Knight Capital (KCG) starting on Wednesday, you will see a sharp drop in the stock from around $10.25 to $7.00. Yet the "Wild Algo" issue was not detected/ reported until Thursday? So why all the selling on Wednesday??

     

    Something is not right here ... Is Knight Capital's "Wild Algo" a cover story?
    5 Aug 2012, 07:12 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    FPA - Good point! Something smells fishy in the castle.
    5 Aug 2012, 07:22 PM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    That chart is very damning, FPA. Whatever happened started right at the opening Wednesday.
    5 Aug 2012, 07:31 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    That's what caught my eye Trip... the news on the bad algo did not break until later in the day. Selling of Knight started at the open.
    5 Aug 2012, 07:41 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    I don't have the link, but there was an article on either CNBC, market watch.com or bloomberg.com that said that Knight leaked or announced to their big clients that they would stop or cancel some trades.
    the article was titled something like "Knight leaks bad trades but Knight is a public company and we are public too"

     

    They said they gave notice about 2 hours before they made it public.
    There is another article on bloomberg that says Knight is paying GS $440 million to get them out of the trades. Sounds like Goldman was the lead trader on the other side. Makes sense as they have a very sophisticated Super computer to scope out things like this.
    5 Aug 2012, 09:36 PM Reply Like
  • optionsgirl
    , contributor
    Comments (5185) | Send Message
     
    Bolivia moves to nationalize silver miner SAC:TSX
    http://bit.ly/NiD4n2
    5 Aug 2012, 07:17 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    OG - That sort of thing is always a concern in many developing areas of the world, especially S. America and Africa.
    5 Aug 2012, 07:25 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Good find OG, that's the sorta stuff that keeps me out of some miners.
    I still am having a problem deciding whether to go with the miners or silver itself. For some reason miners are not responding properly IMO.
    5 Aug 2012, 07:29 PM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    Watch Argentina...
    5 Aug 2012, 07:32 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    Good article with insight into the China slowdown.

     

    http://seekingalpha.co...
    5 Aug 2012, 08:13 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    Mars rover lands on the red planet!
    6 Aug 2012, 01:55 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Let the run on the EZ banks begin - I expect this to be common the next month or so.

     

    Shell pulls money out of EZ..puts it in US & US treasuries:
    http://yhoo.it/OTNj4D
    6 Aug 2012, 05:55 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    5:57 AM Major Wall Street banks such as BofA (BAC), Citigroup (C), Morgan Stanley (MS) and Goldman Sachs (GS) have generally cut their exposure to the eurozone as fears of a breakup increase, while they're also making preparations behind the scenes, the FT reports. These include trying to ensure that contracts denominated in euros won't be converted to any revived currency. [Financials, Global & FX] Comment!
    6 Aug 2012, 06:02 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    4:00 AM Teva (TEVA) has received a subpoena from the SEC over its compliance with U.S. anti foreign bribery laws in Latin America, the company said in a regulatory filing last week. A Reuters investigation has found that eight of the world's top 10 drug firms have warned of potential expenses connected to possible corruption overseas. [Healthcare, Top Stories] Comment!
    6 Aug 2012, 06:01 AM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    The dark side of the worldwide commoditization of big pharma. Now they represent even richer opportunities for nation states to use their police power to extort money and set prices.
    6 Aug 2012, 08:57 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Schapiro just made a statement to Wall St. - No more cancellations or bailouts. If I were an HFT, I would be very careful.

     

    3:14 AM SEC Chairperson Mary Schapiro rejected pleas from Knight Capital (KCG) CEO Thomas Joyce to cancel many of the trades his company had erroneously made last week, leaving it with $4.5B of securities it hadn't planned to buy. Schapiro's stance is a consequence of the 2010 flash crash, when the SEC was accused of arbitrariness in canceling transactions. (see investment) [Financials] 2 Comments
    KCG, BX 3:03 AM Knight Capital (KCG) will reportedly receive a $400M financing lifeline from a group of investors that includes Blackstone (BX), TD Ameritrade (AMTD), Stifel Nicolas (SF) and Jefferies Group (JEF). The consortium is expected to receive convertible preferred stock with a conversion price of $1.50/share and carry a coupon of 2%, giving it 70-75% of Knight Capital. [Financials, Top Stories] Comment!
    6 Aug 2012, 06:05 AM Reply Like
  • Jon Springer
    , contributor
    Comments (4073) | Send Message
     
    Sorry Knight Capital, you just lost on the Washington Wall Street Corridor's favorite game show:

     

    Too Big To Fail or NOT Too Big To Fail

     

    You are NOT Too Big To Fail, good bye.
    6 Aug 2012, 09:46 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    I bet there were many boards involved in conference calls over the weekend wanting to know "could this happen to us"? or "are we covered"?

     

    I bet there are a few nervous HFT's out there and the algo guys and risk managers had to work all weekend non-stop.
    6 Aug 2012, 09:53 AM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    Could not happen to a more deserving group...
    6 Aug 2012, 10:03 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Sorta follows up on last weeks conversation on the economy:

     

    http://seekingalpha.co...
    6 Aug 2012, 07:46 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    I support this article...this weekend Romney opposed more fed bond buying and called for a robust unheard of stimulus..and I think that is maybe right. We mentioned allowing homeowners to refinance at the .25% rate and as far out as that is, it would help. I really don't care about the TBIF banks and their balance sheets. We have to put money in the working mans pocket some way, and it's not gonna be any good with more credit. Here's my thoughts why:
    1. Wages are not going to keep up with inflation, too much global competition
    2. Corps will spend, but not as much as in the past .. demand is weak
    3. If the consumer can refi at a low enough rate, the payments will gain almost 1:1 in increased equity. Therefore reducing the heavy debt load quickly.
    4. This won't stop the foreclosures already in progress, but will end most foreclosures in the future, It also gets rid of lot's of CDS. Which will improve banks balance sheets in the end.

     

    There is more, but due to lack of time I won't post. This really does not hurt anyone, but gives the consumer the same break given to TBIF and to corps that have taken advantage of financing debt at historical low rates.
    6 Aug 2012, 07:57 AM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    LT, I think you are forgetting something. If the mortgage rates go that low -- the 2B2F banks are NOT going to suffer as much as the US taxpayer. Remember 2B2F banks increasingly originate and distribute loans into agency MBS -- they keep some jumbo loans on the balance sheet but not much else.

     

    Very little private capital is currently going into housing finance -- the GSEs Fannie, Freddie, Federal Home Loan Banks (and the government FHA) fund and GUARANTEE around 80% of loans being made. So if rates drop below cost of funding -- the GSE's guarantee these loans and will take a hit if MBS investors demand normalized yields or if the GSEs are required to hold these low rate loans in their proprietary portfolios. GSEs would then have to ask Treasury for more bailout funds as they have already done. And remember -- GSE liabilities are a Congressional piggybank -- they are off-balance sheet liabilities and not included in the often quoted $16T US deficit. The proposal is more smoke and mirrors in my opinion -- the US taxpayer remains on the hook for this "solution."
    6 Aug 2012, 08:47 AM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    Correct as usual, MJ.

     

    Subsidized housing ideas are what got us into the mess to begin with.

     

    I would rather focus on "pushing" more participants into the system by creating a vibrant job market rather than "pulling" people in that cost hundreds of billions for the taxpayer and have a high likelihood of experiencing a dramatic and demoralizing failure.
    6 Aug 2012, 09:02 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    I really didn't forget it, and that is a good point, but very complicated. Don't take this as arguing it totally, but below is sorta my thoughts/opinion:

     

    Fannie or Freddie just recently asked for another $5 billion, which was less than predicted. You are right about the gov't backing 80% of all mortgages..maybe even closer to 100% now. So my point is, Fannie/Freddie/FHA can die a slow death bleeding a few billion at a time as we have in the past, or work out something big to sorta end it.
    IMO, I don't see much private capital going back into the housing mkt for several years....however, if the problem was solved...then private capital would return because higher equity in loan/mkt value would reduce risks and encourage investment say 5 years from now instead of 10 years.
    It would need to be structured where mostly what changes is the interest rate, not alot of principal reductions more than what is going on now. The rate might not be exactly .25, it could be say 1.25%. That might still cover the loan costs.
    I know it's complicated, and difficult to get a handle on at first...but I think the taxpayer is on the hook now and will always be under the present and past system. Just maybe by building equity at a faster pace would get the taxpayer off the hook in 5-10 years and solve debt too.
    There are people out there that can not refi without gov't intervention. Their homes won't appraise, although the owners have never missed a payment or their credit ratings won't pass the scrutiny required now, even though they are current on payments.
    The two things that would boost the economy is lower gas prices (as in 50% lower and lowering mtg. payments. Structured correctly it could be like TARP turned out, more of an investment instead of a bailout. Even if it lost some money over 5-10 years, it might be cheaper than the road we are travelling now.
    I know it is wild, but it is a thought and I am in no way competent to analyse it further..thanks for the reply and hopefully it opens the door for discussion because I expect the next several months to see much conversation around different unheard of ways to boost things.
    6 Aug 2012, 09:08 AM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    From "Wall Street Breakfast: Must Know News"

     

    CFTC poised to abandon silver probe. After conducting dozens of interviews and analyzing 100,000 documents, the CFTC looks set to drop a four-year probe into the possible manipulation of the silver market, as it doesn't have enough evidence to go to court, the FT reports. JPMorgan (JPM) is likely to be relieved, having been the subject of various accusations, although it still faces a class-action lawsuit.
    6 Aug 2012, 10:13 AM Reply Like
  • DRich
    , contributor
    Comments (4819) | Send Message
     
    >k202 ... Alrighty then, proof positive there is no manipulation going on or possibly a retirement from the commission is close so a member cand spend some quality time with a banker is near.
    6 Aug 2012, 10:23 AM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    DRich - Those were my sentiments, too. (sarcasm is the best medicine in times like these)
    6 Aug 2012, 10:30 AM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    "Who are you going to believe? Me, or your own two eyes?"
    6 Aug 2012, 10:38 AM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    TB - Tough choice. After all, the regulators and government never lie. They are here to help.

     

    I have always had a problem with the definition of the word help in this context. I'm not sure the government understands the correct meaning of the word.
    6 Aug 2012, 01:10 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    Is something happening with Sandstorm today?
    6 Aug 2012, 02:30 PM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    Other than Canadian TSX being closed??
    6 Aug 2012, 02:37 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    Ahh... did not know that. Thanks Mercy.
    6 Aug 2012, 02:39 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    MXWL up 9% today.
    6 Aug 2012, 02:40 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    What the hell???

     

    The Spanish stock exchange was down for nearly 5 hours today, reason unclear.

     

    Now, the Tokyo Stock Exchange Group has stopped all derivative trades, Topix futures, JGB futures and options because of a "systems error".

     

    Cyberattack???
    6 Aug 2012, 10:31 PM Reply Like
  • DRich
    , contributor
    Comments (4819) | Send Message
     
    >FPA ... No, I doubt this is much more than bumbling fools. This is not the first time this company and manager has completely screwed up the derivatives market for stock futures. Let's hope the Japanese don't allow this incompetent boob to grow even larger.

     

    http://on.ft.com/Rv200p

     

    Presently, there seems to be a worldwide trading algo problem. I hope it's not something weird like changing the brokerage network rules on how the markets are manipulated.
    6 Aug 2012, 10:58 PM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    FPA and DRich -- you worry needlessly. Our own US regulators are fully on top of the problem (sarcasm):

     

    "The SEC is becoming more aware of the effects of different speed and differential speed on market participants ...

     

    Last week, SEC Chair Mary Schapiro said she has asked her staff in the wake of the Knight incident to expedite the completion of new rules requiring exchanges and other market centers to have programs in place to ensure their capacity and integrity.

     

    The flash crash also spurred the interest of the SEC's market abuse specialized enforcement unit, which earlier this year disclosed it is conducting roughly 20 different inquiries, ranging from order types to how exchanges police their markets..." http://reut.rs/NaubPX
    7 Aug 2012, 08:00 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    I don't think all has been told...3 different exchanges, 3 different problems ... Makes my vivid imagination run wild.
    7 Aug 2012, 08:36 AM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    Think about the non-coincidence which occurs when a "new and improved" piece of software is released to the universe. Early adopters snap it up, particularly those spurred onward by other problems in their business, and voila! They start hitting the bugs...

     

    Is it really logical to assume that ONLY Knight was test driving the new concept?

     

    There could be a rash of these "coincidents".
    7 Aug 2012, 09:10 AM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    Chevron's (CVX) Richmond refinery, the largest refinery in California, had an explosion in its hydrocracker.

     

    The refinery is now under a Level 3 Hazardous Material extreme immediate warning with local authorities advising local citizens to "to shelter in place, go inside, close all windows and doors, turn off all heaters, air conditioners and fans. If not using the fireplace, close fireplace dampers and vents, and cover cracks around doors and windows with tape or damped towels."

     

    The refineries capacity was 244,000 BBL/DAY.
    ----
    Of course it's most likely an unfortunate accident. But in the age of cyber attacks, there are other possibilities.
    6 Aug 2012, 10:49 PM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    September Silver futures breeze past $28 resistance this am. We'll see how long this lasts before the manipulators swoop in (may be happening as I write LOL): http://bit.ly/nXGqkT
    7 Aug 2012, 09:28 AM Reply Like
  • optionsgirl
    , contributor
    Comments (5185) | Send Message
     
    This is a technology I am putting on my radar screen:
    Deep gold mining via horizontal drilling by Anglo Gold Ashanti. According to the company they estimate it to be approximately 8 years away, and $15-20 mil a year to develop. It looks like a formidable problem to solve, but would be a game changer.
    http://bit.ly/MtRcPJ
    7 Aug 2012, 01:09 PM Reply Like
  • Jon Springer
    , contributor
    Comments (4073) | Send Message
     
    Very interesting. Thanks OG
    7 Aug 2012, 01:15 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    With fracking and horizontal drilling for oil & gas, I don't see why this can't be done in certain situations....maybe cheaper in some applications.
    7 Aug 2012, 01:35 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    Excellent find OG! What would really hold huge promise, imho, is the in-situ leaching step that comes later if this first step is successful.
    7 Aug 2012, 03:05 PM Reply Like
  • optionsgirl
    , contributor
    Comments (5185) | Send Message
     
    According to Bart Chilton @ CFTC, they are not dropping the silver investigation yet. He says it was reported inaccurately.
    http://bit.ly/MtRRjY
    7 Aug 2012, 01:16 PM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    Right. Now the CFTC will just let it quietly fade away without further notification. Case still open but inactive. :)
    7 Aug 2012, 01:19 PM Reply Like
  • optionsgirl
    , contributor
    Comments (5185) | Send Message
     
    Chilton is the lone voice telling the truth at the CFTC and doing it in public. He reminds me of Neil Barofsky, who never pulled any punches, imo.
    Once in awhile we see a mensch.
    7 Aug 2012, 01:23 PM Reply Like
  • doubleguns
    , contributor
    Comments (9614) | Send Message
     
    OG my gut says your right about Chilton but....I feel the 4 years to come to this "CONclusion" is what leaves me suspect that anything is really being done. Just buying time is what appears to be happening. 5 margin increases in 10 days says everything that needs to be said.

     

    Chilton has no chance of changing things I fear.

     

    The fact that the CME is loosing business rapidly is actually good news because they will either change or go out of business. MF global and PFG Best are having a bigger impact than any investigation. The longer Corzine is free the more business they loose and all the margin reductions (several recently) they pull off will not save them because no one wants to be robbed....so folks take their money and go elsewhere. China/Hong Kong will eat their lunch IMO simply because they will not change until its too late.

     

    The handwriting is on the wall. They are just not reading it.
    8 Aug 2012, 09:17 AM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    I agree, DG.

     

    We talked back when about the likelihood of the Chinese pulling off a "rescue" should they run out of silver, and then end up buying them out for a song.

     

    This becomes more likely every day.
    8 Aug 2012, 09:23 AM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    BTW, gang, I am beginning to change my thinking and position on potential inflation timing after reading the article linked below. Take a look at the most recent (2nd Qtr 2012) Review and Outlook under the Economic Overview tab. It is well worth the time to read their report, imo.

     

    http://bit.ly/MhTKyU
    7 Aug 2012, 03:17 PM Reply Like
  • H. T. Love
    , contributor
    Comments (19394) | Send Message
     
    MB (Kay Dos Aught Dos): That's a great site. Lot's of good info.

     

    Thanks.

     

    HardToLove
    7 Aug 2012, 06:48 PM Reply Like
  • doubleguns
    , contributor
    Comments (9614) | Send Message
     
    Great article. My hair is standing up now based on my short position in bonds. I will have to return to that thought process that was "set in stone" now. Liquefaction seems to be a possibility.
    8 Aug 2012, 09:32 AM Reply Like
  • Mark Bern, CFA
    , contributor
    Comments (7209) | Send Message
     
    DG - I changed from "set in stone" to "muddled" a while back when the Fed announced low rates until at least 2014. I watched the Op Twist with interest and decided that "The Bernanke" could actually drive long-term bonds even lower and that the OT ops were likely to be with us for much longer than originally advertised. I've been on the sideline ever since. Now I'm starting to get the picture of the low in rates being still well into the future because of the drag that public debt will continue to have on the economy. I'm having to go back to the drawing boards in a lot of other areas, too.

     

    Dang it! Just when I think I have understanding, better understanding forces its way into the picture.
    8 Aug 2012, 12:18 PM Reply Like
  • jhooper
    , contributor
    Comments (8058) | Send Message
     
    There are two reasons that interest rates go up (basically driven by the "risk free" asset treasuries).

     

    1. A vibrant growing economy - wherein the demand for capital is so great because of so many economic opportunities, that it is constantly out pacing supply.

     

    2. Credit risk - wherein another issuer of sovereign debt with the types of volume that the US has is a better alternative to the US.

     

    Neither 1 or 2 are likely anytime soon. Number 2 would also be the most likely scenario for inflation. Inflation is part of credit risk. The inflation rate is a sort of unstated interest rate. If a sovereign that has monopolized the money medium (like a Fed Res note) is creating them faster than capital creation (asset creation) is occuring the notes lose their value. They deflate while the things the buy inflate.

     

    In a scenario where gov intervention isn't killing the economy via price blind regulations and a CB is printing faster than asset creation, you will tend to see inflation in consumer goods. If the note creation by the CB gets really bad, it can actually kill the economy by a loss of faith in the notes it creates. If gov intervention is killing the economy, people become afraid, and they don't buy consumer goods (hence no inflation in the CPI) they buy safe haven goods (savings). Then you get inflation in these assets (have bond prices been inflating or deflating?).

     

    We lost a net of 5 million jobs. Obama's policies have not result in those net lost jobs coming back. Millions more live in fear of losing their current job. The tendency is not to buy items in the CPI. The tendency is to save (bid up safe haven assets - which also now include dollar denominated equities).

     

    Until macro policy changes in a big way somewhere, somehow you are not going to see materially higher interest rates or inflation rates. We are in a malaise economy, and people that have been betting on TBT have been getting burned. Major policy shifts have to occur to stop the killing of the economy with price blind gov regulations and gov stimulus actions that only result in bubbles because these actions induce the burning of capital rather than its creation.
    8 Aug 2012, 12:31 PM Reply Like
  • optionsgirl
    , contributor
    Comments (5185) | Send Message
     
    How about inflation? Isn't that a third reason interest rates rise?
    8 Aug 2012, 12:41 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    Normally we all know inflation is the #1 reason interest rates rise.

     

    This time is different, and is part of the problem at the same time. When they excluded food & energy out of the inflation numbers, we can have basically no inflation,
    But...We all know gasoline is up 400% in 10 years, and now food has hit record highs....but this doesn't show in the numbers. It has also helped corp profits as much as anything else too. Labor costs/raises have not had to keep up with the true cost of living. This lack of money in consumers pockets is a big part of why it took second mortgages to offset the cost of living, they had to "subsidize" their income so to speak.
    I personally think that food, energy should be included and put the index back like it was designed at first. And before the discussion begins, yes social security would be 50% higher...but that is what it would take to either address the problem with s/s or deal with inflation. Either one or both ultimately is a plus.
    8 Aug 2012, 01:50 PM Reply Like
  • Jon Springer
    , contributor
    Comments (4073) | Send Message
     
    co-sign that comment LT
    8 Aug 2012, 01:55 PM Reply Like
  • jhooper
    , contributor
    Comments (8058) | Send Message
     
    Inflation is an interest rate. It is the interest rate for Fed Res notes or any CB note. These notes are the preferred means for a gov to finance themselves. They carry no stated interest. The interest occurs when you lose purchasing power because the notes become diluted.

     

    What drives both inflation and interest rates is the underlying economic environment. That is to say, if the economy is not growing (an increase in technology that allows things of value for humans to be made better and faster) at a pace that is equal to the note creation, then the notes will increase (deflation) or decrease (inflation) in value (purchasing power).

     

    Look at a country like one big corporation. After all that is really what it is. A corporation is just a corporate form of association of a bunch of people. This is why corporations are people. Now imagine if Apple's finance division had the power to issue stock without regards to the operating divisions. How closely would Apple's stock track their productivity? The same is true for the notes (treas and CB) of any country. If the operating divisions don't cooperate with the financing division, then note creation is not coordinated.

     

    Inflation occurs because the notes are losing value due to dilution. The dilution is part of the increase in credit risk, and the increase in credit risk is the reason the interest rates are going up. It is simply the market signaling that the notes are losing their purchasing power.
    8 Aug 2012, 01:59 PM Reply Like
  • jhooper
    , contributor
    Comments (8058) | Send Message
     
    LT

     

    Its always good to question what should be considered inflation and what should not. If you think about it, whose says the definition of inflation put out by the gov was given to them by the hand of God.

     

    Inflation is basically dilution. If the Fed could somehow value perfectly all assets in society, then they could truly measure inflation. As it is now they can't even measure the CPI perfectly. To measure it perfectly they would have to record every single transaction for which a dollar is used. So, they have to sample. This is why when things get out of hand, they are always late to the game. They simply cannot measure all the information they need to prevent their notes from either inflating or deflating.

     

    If you finally come to realize the gov has absolutely no tools to grow an economy (all it can do is protect property, which then allows the economy to grow), you realize anything it does to meddle in the economy is just a consumption subsidy. This means capital erosion, which means a shrinking balance sheet, which means recession. This is why gov action creates bubbles and busts.

     

    If your learn to recognize this pattern, you can then learn to provide some measure of protection for yourself (like not going all in on TBT, buying equities on dips, or going with a 15 yr 1 yr callable at 3% that gets called in a year instead of a 1 yr treas at basically 10bps).
    8 Aug 2012, 02:08 PM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    I conceptualize inflation as an irreversible, hidden tax.
    8 Aug 2012, 03:31 PM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    Smith characterized the effect of capitalism as "an invisible hand".

     

    I look at inflation as the invisible hand of the government.
    8 Aug 2012, 03:37 PM Reply Like
  • jhooper
    , contributor
    Comments (8058) | Send Message
     
    When note creation is occuring at a rate that is dilutive, it is indeed a tax. CBs are really a taxing mechanism. Here's what's interesting. Since it is a taxing mechanism, and if everyone would recognize it as such, it could be the only taxing mechanism you have. No IRS, no sales tax, no tariffs. The gov would just print what it needs to spend, and everyone that uses that currency (both citizens and noncitizens) would bear the tax in the form of inflation.

     

    Either way though, there still needs to be controls on what the gov spends on. Even when it is limited to protecting property, you can way overspend. This would damage the value of the notes that are issued, thus diminishing the purchasing power of the users of those notes.

     

    The crime on the populace is acting as if inflation is something that is necessarily good or benign. It is a tax. If it is understood as such, it can then be properly used.
    8 Aug 2012, 04:10 PM Reply Like
  • doubleguns
    , contributor
    Comments (9614) | Send Message
     
    "Dang it! Just when I think I have understanding, better understanding forces its way into the picture."

     

    I agree but here is something from today that muddles it even more. I know one thing...these two stories are leading to two diametrically opposed outcomes. I just do not know who is right. Call this the flip of the coin for your previous link. They called it the WTF snap back.

     

    http://bit.ly/MjS6gi
    8 Aug 2012, 05:24 PM Reply Like
  • Jon Springer
    , contributor
    Comments (4073) | Send Message
     
    "I look at inflation as the invisible hand of the government."

     

    ... if that invisible hand is a rubber gloved proctologist's hand, I follow what you're saying.
    8 Aug 2012, 05:45 PM Reply Like
  • doubleguns
    , contributor
    Comments (9614) | Send Message
     
    Can you feel invisible? I am "feeling" like its not quite invisible enough cuz its damn painful.
    8 Aug 2012, 06:09 PM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    5:57 AM China's National Energy Administration increases its 2015 target for solar power capacity by 40% to 21 (GW) as lower costs and regulation helping to fuel growth in the sector. Stocks likely to benefit include Suntech Power (STP), LDK, ReneSola (SOL), JA Solar (JASO) and Yingli (YGE). [Energy] Comment!
    8 Aug 2012, 06:35 AM Reply Like
  • siliconhillbilly
    , contributor
    Comments (2704) | Send Message
     
    Is solar PV in China even more of a jobs program then in the US or UK or............?

     

    In a few years, I wonder what percent of installed solar PV panels in China will be connected to a grid or real load. How much of the power produced will be consumed vs dumped? Too bad we will never see the numbers because they should be interesting.

     

    8 Aug 2012, 07:18 PM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    Silver futures may still be down today but SLW is on rip -- up 5%. Latest deal acquisition is good example of how it buys silver @ $5.90/oz while mkt pays $28 http://bo.st/O4DU9n. I trimmed some gains because this one runs up and down fast -- still Long.
    8 Aug 2012, 10:09 AM Reply Like
  • tripleblack
    , contributor
    Comments (13581) | Send Message
     
    Excellent trading, MJ. I was in SLW for years, and did great overall. The avalanche of margin calls was nasty, and wiped out a year's gains in one week, but that was just the breaks.

     

    I moved over into Sandstorm (more SLW alumni) and gold afterward, but now I am eyeing silver again. I think next $25.xx or low $26 price will entice me back into SLW.
    8 Aug 2012, 10:12 AM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    Reestablished position in CPST this morning.
    8 Aug 2012, 10:50 AM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    Coincidence?

     

    The Shell refinery in Martinez CA has just issued an Immediate-Severe-Likely public "Shelter-in-Place" emergency alert.

     

    Residents in Martinez. are advised to shelter in place. Go inside. Close all windows and doors. Turn off all heaters. air conditioners and fans. Close fireplace dampers and vents, and cover cracks around doors and windows with tape or damped towels. Media news networks will continue to carry updated emergency information. Stay off the telephone unless you have a life threatening emergency.

     

    False Alarm?
    8 Aug 2012, 11:00 AM Reply Like
  • doubleguns
    , contributor
    Comments (9614) | Send Message
     
    Stuxnet coming home?

     

    http://bit.ly/S2JV5Q
    8 Aug 2012, 11:41 AM Reply Like
  • FocalPoint Analytics
    , contributor
    Comments (6282) | Send Message
     
    The top American military official responsible for defending the United States against cyberattacks said that there had been a 17-fold increase in computer attacks on American infrastructure between 2009 and 2011, initiated by criminal gangs, hackers and other nations. http://tinyurl.com/blj...
    8 Aug 2012, 11:49 AM Reply Like
  • doubleguns
    , contributor
    Comments (9614) | Send Message
     
    The criminal gang part is probably coming from Wash DC. I wish they would eliminate that problem first. LOL
    8 Aug 2012, 11:54 AM Reply Like
  • LT
    , contributor
    Comments (5783) | Send Message
     
    QE-3 already here: Fed launches $600 B repo's ?
    http://bit.ly/S45Vx7
    9 Aug 2012, 06:18 AM Reply Like
  • Mercy Jimenez
    , contributor
    Comments (2685) | Send Message
     
    Good find, LT.

     

    I think this is a VERY curious development indeed. It appears that it was a 3-day repo -- although the term can go up to 65 days and it was the first time in 4 years that the Fed has injected this type of additional liquidity (you will recall they tested reverse repos last year.)

     

    Some things I think we need to watch which may or may not be impacted by this action:

     

    1) The sudden jump of the S&P past 1400
    2) The reduced demand demonstrated yesterday in the 10-year note auction
    3) Slight bump up in PMs
    4) Continued bump in crude prices
    5) Effect on USD vs. EUR and other currencies
    etc.

     

    This repo injection tends to serve banks in a couple of primary ways: a) they can invest in more risk assets and/or they can shore up their capital reserves. It will be interesting to see where this takes us and whether this may be the beginning of more repos to come.

     

    Here are additional details re: the latest repo:
    http://bit.ly/NK7j5z

     

    And anyone who wants to understand more about repos may be interested here: http://bit.ly/sa8qXb

     

    mj
    9 Aug 2012, 07:28 AM Reply Like
  • doubleguns
    , contributor
    Comments (9614) | Send Message
     
    Mercy do