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Scott Wachsler
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I manage Wax Ink.net, 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
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  • Bob Looses A Tooth 14 comments
    May 12, 2012 2:07 PM | about stocks: DCO, ARCB, PAY, GFF, MYE, SWM

    I often wonder what it will take to make the average investor believe that there are liars, thieves, and cheats throughout the markets, perhaps on a grander scale than can be found in banking and politics. As I noted last week, being an investor at the moment, is extremely painful.

    But fear not, this should all come to an end, in my opinion, about late September or early October of this year. My time frame does assume of course, that the liars, thieves, and cheats in the markets, expect to have a joyful holiday season.

    Portfolio Commentary

    The Wax Ink portfolio dropped 0.8% for the week. By comparison, the Dow was down 1.7%, the Nasdaq was down 0.8%, the S&P 500 was down 1.1%, and the Russell 2000 was down 0.2%. This puts the weekly equilibrium change for the indices at -1.0%

    Year to date, the Wax Ink Portfolio is up 6.9%, while the Dow is up 4.9%, the Nasdaq is up 12.6%, the S&P 500 is up 7.6% and the Russel 2000 is up 6.6%, putting the annual equilibrium changes for the indices at +7.1%, or 0.2% better than the Wax Ink portfolio.

    Market Commentary

    It seems that the good and honorable bankers at JPMorgan Chase and Company (NYSE: JPM) may have failed to completely understand their own hedging strategy. As a result those good and kindly bankers, took it in the old wazoo for $2 billion.

    Shortly after this announcement, I mean...JPM sort of had to say something, along comes Bill Gross, the managing director of PIMCO who bill themselves as "Your Global Investing Authority" and tells the world what a well run institution JPM is.

    Are you kidding me? Had the fine upstanding bankers at JPM found a way to cover up the loss, that's exactly what they would have done!

    Meanwhile as the stock price of JPM heads for the crapper, financial websites are going bonkers. Article after article mention the $2 billion in trading losses and then mention the stock price and then tell folks that now is the time to take a position in the stock and on and on and on.

    Are this people idiots? Sure the price of JPM may well rebound, even passing its all time highs. But my what a gamble the individual investor is taking? What happens the next time a group of bankers try and develop a hedging strategy they don't understand? Will it lead to profits or losses?

    I mean at the end of the day these cats are bankers, not investors. And because they are bankers, they will lie, cheat, steal, or just generally do whatever it takes to make the world believe they are above reproach, that they are the single most brilliant investors of all time.

    In my experience I don't believe I have every met a banker without an ego so huge it would fill the heavens and blot out the sun.

    Yet on website after website, in article after article, individual investors are repeatedly being told that now is the time to buy JPM.

    Never mind that not one single website, not one single article, not one single chartered analyst, not one single anything, has the foggiest idea what the intrinsic value of a share of JPM actually is. Heck they don't even know what the tangible value of JPM is! Yet they all seem to think, know is the time to buy.

    I wish those investors that buy shares of JPM with no idea of the what the stock's reasonable value is, the very best of luck. Over a lifetime of investing, they are certainly going to need all of the luck they can get.

    Equity Commentary

    Holdings in the Wax Ink portfolio again charged toward mediocrity with aerospace and defense contractor, the subject of a recent recommendation Ducommun, Inc. (NYSE: DCO), down 8%, trucking company Arkansas Best Corporation (Nasdaq: ABFS) down 8%, e-commerce facilitator Verifone Systems, Inc., (NYSE: PAY), down 6%, and building materials company Griffon Corporation (NYSE:GFF), down 6%.

    Rising from a squatting position this week were rubber and plastics company Myers Industries, Inc. (NYSE: MYE) up 7%, and paper company Schweitzer-Maudit International, Inc. (NYSE: SWM) up 3%.

    Political Commentary

    Every week I try and include some bit of humor regarding politics at the end of my post. Over the course of the past few months that has become as difficult as watching CNBC. I admit, to me politics is without equal when it comes to boring, since in the end it almost always come down to which politician can out promise the other one. How dull.

    As a result, I have decided to stop putting down my few observations about politics, devoting the space instead to the sounds bugs make when they fart in a pond.

    Wax

    To enlarge the portfolio, please click on the image.

    Wax Ink is comprised of individual investors, NOT licensed or registered with ANY government agency. Please obtain the advice of a registered investment professional BEFORE considering any information obtained from this site.

    Disclosure: I am long DCO, ABFS, PAY, GFF, MYE, SWM.

    Stocks: DCO, ARCB, PAY, GFF, MYE, SWM
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Comments (14)
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  • Guestone
    , contributor
    Comments (15) | Send Message
     
    Griffon is on its way down further due to the upcoming hearings that will be held regarding management integrity and honesty.
    20 May 2012, 11:15 PM Reply Like
  • Scott Wachsler
    , contributor
    Comments (162) | Send Message
     
    Author’s reply » Guestone;

     

    This is the second time I have heard this, the first time was last Thursday.

     

    I contacted the company's investor relations folks and it was news to them.

     

    Realize that under the SEC's FD (Full Disclosure) regulations, the company must notify the markets as soon as reasonably practical regarding material events. Hearings regarding the integrity and honesty of management certainly fall within that category.

     

    There are other company's with similar names, Griffon May, Inc. and Griffon Shipping come to mind. Are you sure it wasn't one of those two?

     

    Wax
    21 May 2012, 04:54 AM Reply Like
  • Guestone
    , contributor
    Comments (15) | Send Message
     
    Griffon Corp, owner of Clopay and Ames. I hope this clarifies for you. This management team is known for their shady business practices and eventually that stuff doesn't just go away.
    21 May 2012, 08:10 AM Reply Like
  • Scott Wachsler
    , contributor
    Comments (162) | Send Message
     
    Author’s reply » Guestone;

     

    Yes I'm aware of what the company owns, and yes this would be the correct Griffon Corporation.

     

    But as I said earlier, I can find nothing that supports your original statement regarding hearings on the honesty and integrity of management.

     

    Wax
    22 May 2012, 04:23 AM Reply Like
  • Guestone
    , contributor
    Comments (15) | Send Message
     
    Asking their investor relations department? How transparent can you be? Are you a paid public relations consultant to Griffon? Why not interview their vendors like any good analyst would do? I am not at liberty to say more other than if you are long you are WRONG.
    23 May 2012, 07:47 AM Reply Like
  • Scott Wachsler
    , contributor
    Comments (162) | Send Message
     
    Author’s reply » Guestone;

     

    ...good for you.

     

    Wax
    24 May 2012, 04:17 AM Reply Like
  • Guestone
    , contributor
    Comments (15) | Send Message
     
    Actually better for me that you are long. Just more overpriced shares I will buy back cheaper (if I buy at all). Next stop $6. Just remember PIGS get slaughtered and this management team are known as piggish.
    25 May 2012, 08:57 PM Reply Like
  • Guestone
    , contributor
    Comments (15) | Send Message
     
    Wax,

     

    You write like a pump and dump scam artist. You are in good company with the unscrupulous and unethical animals at Griffon. Wait until the government contracts start to decline based on reputation issue coming back to bite these PIGS.
    25 May 2012, 08:59 PM Reply Like
  • Scott Wachsler
    , contributor
    Comments (162) | Send Message
     
    Author’s reply » Guestone;

     

    "Wax Ink is comprised of individual investors, NOT licensed or registered with ANY government agency. Please obtain the advice of a registered investment professional BEFORE considering any information obtained from this site."

     

    You should have read the entire post.

     

    Wax
    26 May 2012, 08:59 AM Reply Like
  • Guestone
    , contributor
    Comments (15) | Send Message
     
    I read the entire post. I specifically refer to the Griffon subsidiary's government contracts, not some reference to Wax Inc and the government. Perhaps you should learn to read yourself before posting such dribble. Based on your other writings it is quite obvious that your investment advice is in need of surgery. Your track record speaks for itself and if you are long, I am happy to be short. It is like owning a casino, the odds for the house improve with every person who walks in the door.
    26 May 2012, 06:17 PM Reply Like
  • Scott Wachsler
    , contributor
    Comments (162) | Send Message
     
    Author’s reply » Hi Guestone;

     

    I'm sorry you don't like me or my writing. Hopefully over time, my writing will improve.

     

    As to my comment about reading the entire post, that was in retort to your comment about being a "pump and dump" scam artist, with the idea being I am trying to let everyone know that I am not a securities analyst or anything of the sort, nor am I in this for the short-term.

     

    I am just an ordinary everyday investor sharing the travails of the world of investing with other individual investors.

     

    I have no ax to grind, I'm not smarter than the average investor, I'm just an investor the happens to own shares of Griffon, a stock that I have a cost basis in of $17.96 per share, and which is currently trading at $7.82 per share, and one that you seem to take offense that I own.

     

    Any way, I hope you will continue to follow along, commenting all you like. I will do my best to address you concerns as well as improve my writing skills.

     

    Thanx for reading.

     

    Wax
    27 May 2012, 12:13 PM Reply Like
  • Guestone
    , contributor
    Comments (15) | Send Message
     
    Actually I now understand why you are seeking to prop up Griffon shares. A cost basis of $17.96 and you continue to hold? What hopes do you have with this management team. They have lined their pockets the whole way down and if you look at their recent 14A statement, they continue to line their pockets and create incentives for mismanagement, poor performance and loss of shareholder value. Why back this band of thieves? Why recommend to anyone that they join you in this misery?
    28 May 2012, 10:36 AM Reply Like
  • Scott Wachsler
    , contributor
    Comments (162) | Send Message
     
    Author’s reply » Hi Guestone;

     

    I went back through all of the stuff in this post and I didn't find anything that could be construed as attempting to prop up the shares of Griffon.

     

    I also can't find where I have backed the current management team nor recommended to anyone that they actually purchase shares of Griffon.

     

    As to my cost basis what can I say? Sometimes it sux to be me.

     

    Wax
    29 May 2012, 04:21 AM Reply Like
  • Guestone
    , contributor
    Comments (15) | Send Message
     
    Wax,

     

    I like the honesty. Sometimes even the mention of an article suggesting one is long is enough to try to prop up the stock and therefore back a subpar management team at best. We all have some bad days and the day you picked Griffon was one of them.
    29 May 2012, 08:33 AM Reply Like
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