waldipup

Fannie, Freddie: Beyond the Balance Sheets

Nobody knows what the freak they are invested in.

I personally have seen complete junk go into their portfolio.

I'm a nobody , so multiply that by (how many others?)

There is no way to value this entity.

It may be hopelessly technically bankrupt , with the only positive , as the writer points out , that the government will add it to its welfare list ,
along with everything else at this point , to keep it floating ,

And then at some magical point in the future real estate prices will rise and it will become viable again.

It's applicable that the writer posts in biblical fashion , because that's what this is at this point -

A "belief" that the gov can carry everything on its back , no matter the load , and everything will work out ok.

You can get 5% on a 4 or 5 year cd , (also gov. backed!) , and there are other beaten down stocks with potential to invest in not dependant on government welfare to survive.

Just my opinion.

Why Thornburg Mortgage Will Survive

I think the operant point to consider , which is often overlooked yet prima facie , is that the risk/reward in this company makes it silly to bother with - period.

Who cares if it rises from .25 to .35 ?

Or even to a buck -

Please remember that the value in buying distressed stocks is that they retain their former potential in one form or another and can possibly rise back to former levels -

ie: I took a shot at AES after it dropped to 1 (from 60!) because its South American problems and the industry collapse in general didn't warrant the drop -

It was still a viable , worldwide energy producer.

I eventually sold my shares at 16 , and my bonds doubled, + 16% int. while holding , when called at par. (I bought them in 40's w/8% coupon).

Thornburg has no such potential for this per dilution ,can EASILY (though not for certain) still go bust , and it is foolish to take risks here with many other beaten down stocks with much more safety and potential gains.

Gold's Divergence Between the Paper and Physical Markets

Anything can happen -

Gold can fly into the thousands , or drop below 500.

But nobody was hypothesizing that gold "can drop below 500 and still be in a bull market" before the recent part of this drop ,

nor was the economic analysis related to this presented.

Bottom line - Dont listen to no one , and allocate in an intelligent and diversified manner to be protected against all potential eventualities ,

Remembering, per various advice offerings, "nobody nose nutin".

"Still in a bull market below 500" may be a concept of intellectual interest , but aint no use to an investor being demolished by the drop to know that his investment is "still in a bull market".

Venezuela Gold Miners: 'Misappraised'

Wow!

Foist , Chavez didn't take , or threaten to take KRY-

He told them "no go - you're in an environmentally sensitive area , and you can't mine there".

How do you fight that? BC in Canada does the same thing every day.

Second , despite the above , which is simply a savvy ruse to screw KRY , any investment in V will be beaten down to the bone , so that Chavez can make a "fair bonifide offer " -

Based on the beaten down price , which he beat down!

Maybe some nibbling at distressed prices is do-able , but I wouldn't
go heavy in V -

Especially when you can literally close your eyes and buy distressed mining stocks in AAA locations these days?

Eastern Platinum and First Uranium Top Raymond James' Favorites List

"Shares in Eastern Platinum, are currently trading at roughly $1,170 per ounce platinum, representing a 43% discount to Raymond James' 2008 platinum price forecast of C$2,051 price target."


What is the significance of that?

It should trade at the actual price forecast?

It seems top me that one half that forecast is quite high a valuation in itself?

Gold Miners Not Necessarily Golden: The Case of Northgate Minerals

It may be an oximoron to call this investment AAA and 57% insured , and yet :

"the Corporation is currently holding ARS with a par value of $72,600,000, which currently lack liquidity.

The estimated fair value of the Corporation's ARS holdings at June 30, 2008 was $61,987,000, "

No liquidity and a 10.6mil. drop in "estimated value" , if it did have any value?

Then again , maybe that's the definition of AAA these days?

Amazon.com Likely to Remain Range-Bound for Time Being

Dont follow this , but went to buy something there the other day and found they now charge tax on internet purchases -

In NY at least.

Wonder if that will affect sales at all?

Where Are Precious Metals Heading?

There is no question whether gold should rise on a fundamental level.

The cost of a slice of pizza has risen more over the years due to dollar dilution than gold has.

But yet gold is fairly priced/overpriced?

The real question is how long can the gov't. keep printing money and still retain credibility.

No longer?

Another year?

Another ten years?

Nobody knows.

How can you keep bailing out financial entities for countless billions of dollars , fund social security , medicare/medicaid , and the myriad of other government expenses (including interest expense)

and just keep on truckin?

Anybody see the vertical increase in gov't. spending and borrowing over the last decade?

How do you justify that without an income equivalent?

But nonetheless , though the goldbugs (like me!) are fundamentally correct , (Larry Kudlow notwithstanding) ,

the real question is the timing , and being correct on the fundamentals but a decade or more off on the timing of how long a long term powerful government can keep on chooglin' on fumes could possibly be tantamount to being wrong "As Time Goes By".

Banks: Is This the Biggest Bear Squeeze in History?

Maybe I didn't peruse all the writings thoroughly enough ,

but didn't the FDIC just put up 10% of its reserves to deal with IndyMac?

Because the gov't. stepped in to help Fannie/Freddy , does that make their problems go away?

You can have the government print money and make all our problems go away?

Is the "upside surprise" we are to expect in the U.S. based on the drop in the oil price from the 140's to the 120's?

That new "lower level" of oil prices can now support economic growth?

Is or is not an $1800 Heat and hot water yearly bill a few years ago slated to be $7 - 8000 this winter?

How will that impact on subprimers (and others) barely solvent now?

Will that help or hurt Fan/Fre ?

(Yes , they do hold many subprime loans.

Their guidelines have been massively subverted by phony appraisals and "creative" income/credit maneuvers by "certified, licensed" brokers .

I'm not a gloom and doomer , but I'm not blind or easily placated by "mainstream" assumptions .

Rome , the ultimate power of its time , kept plodding along during its downturn -

Until it stopped plodding.

IndyMac Failure: How Much Trouble Is Sen. Schumer In?

"This is the way Washington works, you should know that by now. "

Did we just brush past any justification for direct criticism of Schumer ?

(and by substitution , the criticism of ANY gov't official - unless , of coarse , it's a Republican , in which case this exemption doesn't apply!) -

And instead direct the criticism towards the guy daring to point out the inappropriate rhetoric by Schumer?

I reckon it's a free country and anyone can say whatever they want -

And I'm also glad we don't hang "witches" anymore ,

So if someone points a finger in Schumer's direction ,

They don't end up like Clint Eastwood in

"Hang Em High" for doing so.

Why $140/Barrel Crude is Unsustainable

What would it do to your analysis if war broke out in the mideast and Iran closed the straits of hormuz?

Would the price still go down?

Or many other alternate possible events

(All of which are relevant , as evidenced by their being partly built in ,right now, to the oil price).

200 would not be out of the question , and a far cry from the present 140 , regardless of the l/t fundamentals.

My point is that a time/price analysis can be done at any time , and it won't necessarily reflect whether prices have peaked or not.

And right now , nobody has any freakin idea which way the next direction is after this "drop" to the 130's , or maybe lower.

All the analysis in the world won't accurately tell you when "peak oil" will kick in , or if an event will raise or lower the price tomorrow.

The only thing we do know is that if you're not in now , you've missed the boat , so jumping in at these levels can be risky regardlerss of the reward potential.

So , in that case - DO NOTHING .

If the price goes up , tough luck , you missed this one -

Try something else when it's cheap .

If the price drops appreciably -

Take some bites at positions at what appears to be intermediate term support and hope for the best.

It is Time to Go Long the Dollar?

I hate to say "it's different this time " , because that is an amateur mistake to make.

But I will say that if your position is being attacked , you can shoot back and drive off the enemy over and over again -

Until you have run out of ammo.

Then , I would take the liberty of saying , upon the next attack , that

"It's different this time" .

See if you can draw any similar inferences per the "two previous 7 year rallies in the dollar " , to now.

Why I'm Still Holding Onto Gold

I'm holding GG since 5 Doc - have never sold one share.

I'm not smart enough to time/trade the market , so I just have to do the best I can with my limited capabilities.


GG has just broken not only its previous high , but a reverse H&S pointing to an initial goal of 55 .

Since 45 is the breakout point , it woulde be a fortuitous spot to take a shot , either now or on a later retracement back there ( to test the neckline ).

Gold itself has also broken out of a H&S bottom on Friday , with an initial goal of -

Around the all-time highs.

Buying around 920 or so is a conservative play because if the H&S breakout fails , you can exit below the neckline and consider it a conservative , low risk , low cost trade.

If the neckline holds , the breakout is valid , and the price moves up towards its tech goals , (or eventually much higher!) , you've hit a home run.

Ditto for GG.

John -

I actually understand your comment and view it less harshly than the other guys do , because your premise in general is a good one to follow.

But I believe you are underestimating the stage of the market which we are in.

EVERY bull market moves up " a lot" , but then moves up "a lot more".

You are picking a top , but it may just be a resting/correction point.

This move exceeded the 79-80 high of 800's for the first time.

So far , all it has done is continued on up from that historic breakout to 1030 , and corrected to test the 79-80 peak.

Now it has turned , to a large probability , technically bullish again.

Granted it ain't 250 anymore , but Berkshire Hathaway ain't two bucks a share anymore either , and it's been rising and rising anyway!

Ditto oil from its first peak at 80 , down to 50 -

And if you insert your comments there , guess what happened next?

Anyway , as John Fogerty said ,

It's just a thought.

Time to Short Both Long-Term Bonds and Crude

With all due rerspect to all that there vanalysis -

I don't think I'll try to call the top in oil -

Or in anything else for that matter.

I'd rather patiently wait for unwanted , undervalued entities , and hold them until they are sky high.

Still holding my 1 buck SSRI , 4 buck PAAS , 5 buck GG , .35 BQI , etc.

Don't think I'll try to "catch" the oil top -

Just keep looking for things of value but out of favor

so that nobody else but me wants it , and hold it until everybody wants it - AND WANTS IT REAL BAD !

Why Tax Credits for Health Insurance Won't Work

"To establish tax credits for health insurance requires the creation of a bureaucracy to assess and monitor health insurance plans--somebody has to decide purchase of which health insurance plans qualifies one for the tax credit, and which does not. Regulation via tax expenditures and a bureaucracy to define and monitor them is regulation--a point that eludes Perry Bacon Jr. His example of how McCain is for reducing regulation--well, that dog just won't hunt."

You gotta be kidding , right?

How desperate can you get to find a negative in McCain's tax credit plan?

First , there is some degree of regulation in everything , so this is where you figger it's the place to "draw the line"?

Second , deductions for health care expenses are already a deductible entity , and must be be "qualified" to deduct , so a theoretical standard for deducting health expense already exists , which can be tweaked to be applicable to credits as well.

Third , many employed people have some form of health care assistance through their job .

Those not employed (but not destitute) have very little options to defray health care expenses available to them.

Not only are tax credits a practical idea , but it is insane to not have them.

Employers providing health care expense assistance to employees get to deduct their cost , so it's a tax subsidized aid to the employees.

So - non employed people should not only get no break on health care taxwise , but in addition SUBSIDIZE the aid to the employed , via the general tax base "making up" the revenue lost from the employer deductions for health care to employees?

Maybe you could consider going back to the drawing board and
rewriting this article after re-evaluating your statements.