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Mortgage REITs: Stick with the Seasoned Veterans [view article]
little boys? you mean the 30 somethings that brought us this debacle? Agreed! However, the seasoned vets were the ones watching the little boys play with matches while sitting on gas cans. :-( ReplyThe Global Recession's Here: How to Profit from It [view article]
A simple and quick 40% decline from the highs in housing and stock indexes would immediately solve this asset bubble in the U.S. I hope the government doesn't get involved in protecting this asset bubble... ReplyThe Global Recession's Here: How to Profit from It [view article]
You can bet the the wildeyed stockbrokers in CNBC are already long this market and they are trying to get the sheep to jump on the band wagon as its sliding over the cliff. One thing that Matt didn't mention is the price of crude. We are running out oil and the price is only going to go higher. The effects of $100 oil have not yet been felt by the world economy. I believe that the high price of energy will mean that equities are now only worth half what they were in October. I think if you traders want a really good bet you will buy 500 put contracts on the Qs, strike = $36, expiration = May. This $2500 bet could turn into $90,000.I'd like to say this to rustypipes: I agree with you that natural gas is a fantastic way to go for an interim energy solution. Natural gas pipe supply lines are everywhere. Every service station could have a compressor and just change your empty tank for a full one. I heard Boone Pickens say the same thing. As for your disdain for the Prius I think you missed the point. The Prius may not be cheap but that matters less than the fact that it dosen't pollute the atmosphere as much as other cars and it helps preserve what small amout of light sweet crude we have left. I think that as more hybrids are produced they will be cheaper to build and even more efficient to drive. Reply
Mohan
The Global Recession's Here: How to Profit from It [view article]
The US is definitely in for deep trouble. All data & analysis points to this fact. It should be realized that the American economy is not a debit driven one, but a credit driven one. The dollar can be easily strengthened, but not... why? Is there a hidden agenda?After all, nothing happens without a reason my friends. This could have been prevented long back itself, but it was not. And its not that the powers that be, are unaware of an impending trouble.
My view is that this will go on to become a global phenomenon - the global economy will come to a grinding halt, reversing years of progress & globalization and will ultimately force a complete restructuring of the global economic system. I'm not predicting a doomsday, but just giving an outlook based on simple math & common sense. Reply
The Global Recession's Here: How to Profit from It [view article]
First of all I'd like to say to "Cheap": Do your homework before you open your mouth. Do you have ANY idea how much energy and pollution were involved in making your hybrid? When your battery dies (and it WILL soon) let's see what your saving!Natural gas is the ONLY viable alternative energy solution to oil based products. It's technology is already proven and in place and it's the cleanest tech. for combustion engines. Like it or not, world automakers are not going to retool just to make eco-friendly vehicles! We've been down the hybrid road before and it's just "show and tell". If you think natural gas is going down in price long term, I'll buy all you want to sell!!!!! Reply
The Global Recession's Here: How to Profit from It [view article]
Here's my response to two of the posts:AnonGeneral: Shorting the Russell 2000 should be just as profitable as shorting the Nasdaq or the Dow. However, small caps tend to lead large caps when coming out of a downturn, so I would expect the Russell 2000 to be the first of those three indexes to turn positive.
globalmacro: I think it's a bit unfair to jump on one bad pick. For the record, I have only written articles on Seeking Alpha for three stocks. If you visit my blog, you will see that my Monthly Stock Portfolio is up 3.92% since it's inception on October 1st. The S&P 500 is down 11% over the same period. That's nearly a 15% outperformance in just six months. When you go to my blog, feel free to see my Motley Fool Caps Ranking. I currently outrank over 98% of the other stock pickers on that site. I'm more than willing to admit a bad pick, but let's get the rest of the facts on the table before you go around trying to smear my reputation. Reply
The Global Recession's Here: How to Profit from It [view article]
It was interesting today that Bernanke said the US should be able to avoid a depression based on the lessons learned from his study of the Great Depression. Hmmm, so he thinks a depression is possible and he thinks that the situation is a direct parallel to the Great Depression.I admire his confidence but sometimes all the study in the world of an old test doesn't prepare you for the test that has yet to be written. Reply
The Global Recession's Here: How to Profit from It [view article]
Arent you a little late to the party? I seem to recall some earlier posts where you called for a number of stocks to have big years (ie Landec which is down to 8.80 from 13 when you recommended it). You're just like a Wall Street analyst -- you only come around once the move has already happened. If you want to get in front of the crowd, it's too late to get this bearish. ReplyThe Global Recession's Here: How to Profit from It [view article]
The FED is just now saying out loud that we are in a recession, and have begun to say the nasty words "prolonged" recession! Have you ever heard them use that terminology before? I haven't!They are trying so hard to spare our feelings and wanting us to know the grim truth. Not since the great depression has there been a time of World-Wide slowdown of all the world indexes at the same time (except South America), all trading below their 200 day moving average.
Both PE and earnings can fall in a long..."prolonged recession," one that might last 5 years to bottom and 5 years to recover to the present level. I say that because with the expected $1 trillion dollar loss of capital by the worlds banking system, there will be insufficient capital going forward to finance homes, business and commercial real estate to do anything more than just limp along, year after year. It will take a long time to recover that lost investment capital... and much longer still to recover the $6 trillion already lost by the stock markets all over the world. That stock-wealth is no longer available to be sold to invests in wealth production or to prop up liberal government with high taxes, etc. as we will soon have with the liberal democrats taking the congress and white house. Sound like we are going back to 90% tax rates to sustain our present appetite for social programs. It will be very hard to cut budgets of national/state/local as well as personal budgets back to the point that we spend what we have, rather than what we can borrow. This truly is a crisis.
I am ultra short SRS and FXP. I am playing these like a cash register, they go up and down in short sharp swings which can be very profitable. I look for SRS to rise sharply after the REIT earnings are announced, the first week of May.
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The Global Recession's Here: How to Profit from It [view article]
So your argument is that the U.S. is headed into a heavy recession. The evidence is declining GDP, falling home prices (with no end in sight), the more than doubling of household debt as a proportion of GDP (and the rising use of more expensive credit card debt), declining non-farm payrolls and increasing civilian unemployment, rising bankruptcies, falling corporate earnings and the ongoing disaster in the financial sector. No mention is made of the financially overextended American government.It is also argued that the U.S. will take the rest of the world with it. The evidence here is thus far rather thin. You point to the Baltic Dry Index and railroad activity data. The data on world stock markets clearly indicate that it the U.S. markets that are the most overvalued.
Though 'pockyclips' (see above) is right in pointing out that the growing middle class in India and China (and other emerging market countries) will not be able to fill the gap created by U.S. consumers in recession mode, the worldwide growth of the middle class (who are middle class in terms of purchasing power parity of their local curency) is resulting in much stronger domestic markets which might continue to grow even during a U.S. recession.
The decoupling thesis may have been carried too far, but it remains to be seen whether the rest of the world will go into economic collapse because U.S. consumers are having difficulty with their mortgage and credit card payments and that the world will only re-emerge from this when these same consumers (and their banks) have their financial affairs back in order.
Half of the construction cranes in the world are said to be currently found in China and would appear to be, thus far, still active. Reply
The Global Recession's Here: How to Profit from It [view article]
Thanks for the nice article Matt - really well done, and very generous of you to share with all of us. Are you considering shorting the Russell 2000 as well, or are you mostly just focused on the DJIA and NASDAQ?thoughts appreciated. Reply
2020
The Global Recession's Here: How to Profit from It [view article]
The globalists who think the Chinese and Indian middle class willtake up consumer spending where Americans leave off are wrong.
Together, they may be twice as big, but have 8-10 times less income.
As early as mid-summer, Chindia will have to cut back on production.
And they will either join us in our economic morass, or start a war to keep on producing. Reply
The Global Recession's Here: How to Profit from It [view article]
I have driven a Plug-in Hybrid for a year now that gets over 100mpg using Clean Domestic Wind Energy to offset the amount of Dirty Foreign Oil I need to buy.In a month, for about 2,100 miles I use 15 gallons of gas, and 18.00 of electricity. At today’s cost of $3.25 per gallon, that is a total of $66.75. That works out to be about 3.2 cents per mile. In a standard Prius, that would be 6.5 cents per mile. In my Yukon that would be 27 cents per mile.
Look at it this way, at gas costs of $3.25;
Yukon, $568.75/month
Prius, $136.5/month
Plug-in Prius, $66.75/month
Those are numbers and Real Dollars you can take to the bank!
Do the math for yourself… your car vs. a 50mpg Prius.
Burning Fuel, “any liquid fuel” in our cars to throw into the air for all of us, and our children, to breathe into our lungs is bad. Why keep being a slave to a pump when electricity is already pumped into your home and you can even make it on the roof of your house.
Plug-in cars are now going to work for everyone, but they are coming even if I have to build them all myself. I’ve done five so far and more are on the way.
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Mortgage REITs: Stick with the Seasoned Veterans [view article]
richandmer, you can find articles on the "veterans" here on Seeking Alpha (click on the "More By REIT Wrecks" link just below the article), or on reitwrecks.com. ReplyMortgage REITs: Stick with the Seasoned Veterans [view article]
Joe, you are right. The suggestion that Real Point was using selective negative data to sell research was flippant. The "headline" increase in delinquencies in the first paragraph of the report was what caught my eye. The full report is obviously more comprehensive, but nonetheless much less attention grabbing - hence the irreverance toward Real Point. I apologize, and I have deleted that suggestion from the original source post.To be fair however, the point of the article was not to besmirch Real Point. The point of the article was to illustrate out that the more recent vintages of CMBS are experiencing higher levels of default (as your research aptly pointed out), and more importantly, the implications of that for those Mortgage REITs that invested in them. Incidentally, the number on the total level of outstanding CMBS debt that I used in the article came from Wachovia/Intex.
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