Scott Wachsler's  Instablog

Scott Wachsler
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I manage Wax, a baseline equity research company comprised of individual investors not licensed or registered with any government agency. I have been all cap value investor and independent equity researcher for the past 30 years, and believe that patience is the key to successful... More
My company:
Wax Ink
My blog:
Wax Ink
  • Performance - Week Ending 03/22/2013 0 comments
    Mar 23, 2013 11:33 AM

    Last week I noted that the markets continue to run and run hard. This week it was different story. This week the markets hated everything.

    I note different events that happen in the market in this space, but in the end, as I have said many times, I really don't care what the markets are do or don't do.

    Last week of course the markets are all freaked out about Cypress and all of the bullshit the government there is trying to pull. I have no idea if I have this all straight, but from what I know, here's the deal.

    Banks, including banks in Cypress, got caught up in the mortgage bubble. When that bubble burst, banks took bailout money from their Central Bank, in the case of Cypress from the European Central Bank, in order to keep their doors open.

    But further assistance is needed and it's hard to go back to the markets and sell bonds when you can't retire the bonds you have already sold. Why would anyone buy new bonds? What to do what to do?

    So the Cypriot government bankers went back to the European Central Bank and asked for more dough. The European Central Bank said okay but you have to make these changes first including a reduction in your country's debt.

    In order to make that happen, the Cypriot government liars and thieves came up with an idea for a one-time 10% tax levy on all retail banking accounts.

    The decision to impose this tax must be properly vetted via the liars and thieves club, (in America we call that Congress) before it can be implemented.

    But once it was announced that such a measure was being considered, the shit was on, and folks started pulling all of their money out of banks, savings and loans, or anything else accessible by the government.

    Certainly the issue is not yet resolved, but the markets, run by the chicken shit computer traders, don't want resolution, they want money, and because they do, the markets started taking big dumps and never looked back.

    Welcome to the free enterprise system everyone.

    My name is Wax, and I am an individual investor, a working class investor, just trying to do the best I can in a world that was never intended for investors like me.

    Every week in this space I recount how poorly I have managed The Wax Ink Portfolio during the prior week.

    If you would like to follow along you are in the right place.

    On the other hand, if you are looking for market commentary intermixed with the bullshit that is politics, I suggest you try watching pigs shop.

    The Wax Ink Portfolio closed off 0.6% for the week. By comparison the Dow was essentially unchanged, the Nasdaq was down 0.1%, the S&P 500 was down 0.2%, and the Russell 2000 was down 0.7%.

    The Volatility Index, commonly known as the VIX, closed at 13.57, up 20.1%.

    Year to date, the Wax Ink portfolio is up 5.6%, the Dow is up 10.7%, the Nasdaq is up 7.5%, the S&P 500 is up 9.2% and the Russell 2000 is up 11.4%.

    The portfolio breakdown remains the same, with 70% of the portfolio in equities, 30% of the portfolio in cash, and 0% of the portfolio in bonds.

    I continue to research stocks, with 34 companies currently on my research list.

    Holdings in the portfolio will be at their 1825 day average the end of next week. Once I reach that point, I will start to get real serious about what to take out of the portfolio and what to move into the portfolio from the research list.

    This week's moving on up stocks were government communications and computer contractor Ducommun, Inc. (NYSE: DCO), up 9%, small tool maker The L.S. Starrett Company (NYSE: SCX), up 8%, and building materials company USG Corporation (NYSE: USG), up 3%.

    This week's turd in the bunch bowl stocks were ultra-capacitor maker Maxwell Technology, Inc. (Nasdaq: MXWL), down 21%, rubber and tire king The Goodyear Tire and Rubber Company (NYSE: GT), down 7%, and container maker Myers Industries, Inc. (NYSE: MYE), down 6%.

    Not Performing
    As I note every week, there are several portfolio stocks that simply are not performing, and while that really pisses me off, not only am I the one that bought them, I still believe in all of them.

    I hope within the next 5-6 weeks, to have the time to go through the entire portfolio to re-exam why I bought the stocks in the first place and why they are still on my portfolio today.

    The top three non-performers remain communications equipment company Tellabs, Inc. (Nasdaq: TLAB), down 61% since added, government contractor SAIC, Inc. (NYSE: SAI), down 35% since added, and garage door/telephone headset maker Griffon Corporation (NYSE: GFF), down 34% since added.


    Wax is a baseline equity research company comprised of individual investors NOT licensed or registered with ANY government agency. Always obtain the advice of a registered investment professional BEFORE believing any information contained herein.

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