logicalsinger's Comments

Jim Rogers Believes World Is Heading for Depression

Thu, 02 Apr 2009 09:05:06 -0400

I don't think Rogers gets the fundamentals of wealth creation. At the root is the intellectual property machine which has been until now US-based innovation and technology. Emerging markets wealth is derived from that root wealth creation when American and European companies move to outsource manufacturing and services. Until you see major proprietary innovation and intellectual property (tech, pharma, media etc.) coming out of emerging markets, I wouldn't get too excited again about those markets.

Financials: Cleaning House Is Always Better

Fri, 20 Mar 2009 15:26:50 -0400

<< A financial system which measures success by how much it enables the creation of production of goods and services of utility is efficient. >>

So if I borrow money from the bank and invest it in the creation of "goods and services of utility" but I don't generate any profits in that effort, we can call the system 'efficient'? Er...not exactly. I destroyed wealth in the process even if the goods and services had utility

On Mar 20 01:04 PM John Lounsbury wrote:

> Simon - - -
>
> I read your NY Times article. Among the reasons discussed for why
> keeping the same management and operatives in place is a bad idea,
> the strongest for me is the motivation of the perpetrators to:

>
> 1. Cover their tracks;
>
> 2. Try to protect and advance their own financial interests over
> those of the company; and
>
> 3. Continue to obtain obscene compensation for "working out the problem"
> after receiving obscene compensation for creating the problem.

>
> Add this to the perception that taking risks that blow up has no
> penalty if you can construct a big enough bomb to convince your hostages
> (the U.S. taxpayers) that you are the only one competent enough to
> deconstruct the bomb, you can get rich building the bomb and then
> add to your riches by deconstructing the bomb. It is a big problem
> for this to happen from the enrichment of the bomber perspective.
> It is an even bigger problem that the rest of the world will never
> learn all the details of the bomb if both the building and deconstructing
> process are done behind closed doors.
>
> It is becoming ever more apparent that allowing the "smart people"
> to "work out" this crisis is doing nothing more than enabling an
> innefficient financial system. A financial system which measures
> success by how much money its minions can make is inefficient for
> the 99.9% of the population not among the minions.
>
> A financial system which measures success by how much it enables
> the creation of production of goods and services of utility is efficient.
>
>
> We have lost the latter measure of success in the past couple of
> decades.

Financials: Cleaning House Is Always Better

Fri, 20 Mar 2009 15:18:55 -0400

I think most people in the financial industry, including most people at AIG, are honest upstanding people. There were some rogues (Madoff etc.) and there were some risks which were poorly understood, but I don't buy the idea that we are waking up now and finding out that everyone was a thief all along.

Financials: Cleaning House Is Always Better

Fri, 20 Mar 2009 09:21:46 -0400

Cleaning House, in particular the House of Representatives, is a great idea. Pelosi and co. are demonstrating their incompetence on a daily basis.

More Outrageous than Bailout Bonuses? Nonstop Printing of Money

Thu, 19 Mar 2009 08:38:23 -0400

It's the lawyers against the MBAs. The lawyers (Obama, Congress, etc.) are having a field day while the MBAs (Wall Street, corporate America) are on the defensive. It's a battle of the elites. The populist sentiment is just a tool, in this case in the hands of the lawyers. The media is full of people consumed with envy and they are also mad at MBAs for making so much money.

Many MBAs don't create any wealth but many do! No lawyer creates any wealth but most redistribute it.

Chinese Are Likely to Halt Purchases of U.S. Treasury Debt

Fri, 13 Mar 2009 13:34:19 -0400

User 360916
No, this doesn't require "rock-solid logic". It only requires a sense of ethics that demands that other parties honor their commitments. What is "breathtaking" is the willingness of so many people to look the other way while someone is "drinking their milk shake".

On Mar 13 10:28 AM User 360916 wrote:

> Logical snigger: your rock-solid logic in the field of global trade
> is breathtaking. Why not run for political office and then you could
> call the shots! We'd be so much the better if your political beliefs
> became the foundation of global well-being! Hooray!

WSJ and Barron's Watch: Overall Consensus, Bottom Has Not Been Reached

Fri, 13 Mar 2009 08:28:12 -0400

That is actually good news. The consensus is generally wrong at the extremes, whether it is March 2000 when everyone was bullish (new economy yada yada) or March 2003 when everyone was bearish (Iraq invasion etc). In both cases, the consensus was hugely wrong.

World War III: U.S. vs. China?

Thu, 12 Mar 2009 08:13:52 -0400

<< The bottom line is the Chinese, who are the largest foreign holders of United States Treasury Bills, have been underwriting U.S. economic growth for decades.>>

They have been underwriting mainly their exports of Chinese-made products in the US. At the root, economic growth came from America's tech boom and other innovations. Superpowers don't go to war against one another. Little upside since neither will conquer the other, and huge downside. They wage war through proxies just like the Soviet and US did in the Cold War.

Money from the Sidelines Will Determine Next Rally

Thu, 12 Mar 2009 08:03:42 -0400

I think there is plenty of "stock on the sidelines" that may go into cash. I don't believe 'Cash on the sidelines' has ever been a good indicator of future market performance.

Citadel's New Hedge Funds

Thu, 12 Mar 2009 08:01:48 -0400

<< Ken Griffin's Citadel has plans to roll out a few more funds, even after Citadel's flagship funds had a rough year in 2008.>>

I would rephrase this as "to roll out a few funds BECAUSE Citadel's flagship funds had a rough year". Older funds have a high water mark and won't earn any incentive fees for a while. New funds have no such hurdle.

Another Reason to Be Bullish on Altria

Wed, 11 Mar 2009 10:56:19 -0400

Tough to argue with an 8% yield for a defensive stock. Looks good to me too. Treasury notes pay you 1 or 2%. I think the extra 6% more than compensates for the extra risk of litigation etc. Good call!

Is China a Good ETF Bet?

Wed, 11 Mar 2009 10:44:55 -0400

NO !

Seven Promising Investment Opportunities in France

Tue, 10 Mar 2009 08:18:15 -0400

EADS: The A380 is a disaster. It wouldn't shock me if it bankrupted them in the end.

Goldman Sachs Is Toast

Tue, 10 Mar 2009 08:13:52 -0400

$122 billion in cash??? Really? Are you confusing their own cash and cash held for other parties? And what are the liabilities on the other side of these cash assets?

On Mar 10 05:53 AM mmmparsley@yahoo.com wrote:

> I'll take the opposite side of that bet anyday.
>
> Goldman has $122 billion in cash, which I believe is still considered
> a tangible asset. Are you sure that they are 23x overleveraged?
>
> It appears to me they have significantly more room for error than
> either Bank of America (seekingalpha.com/symbo...) or Citigroup
> (seekingalpha.com/symbo...). I'd imagine some financial companies
> are going to remain standing when this is all said and done, and
> I see few mega-institutions left standing as cash rich as Goldman.
>
>
> I'm more of a micro-cap hunter than a institutional bank analyzer,
> so correct me where I'm wrong. Perhaps my arguments are too simple.
>
>
> Dave

Gold Continues to Gain Ground

Tue, 10 Mar 2009 08:10:37 -0400

As your chart shows, from a technical perspective, you would buy around $87 which is the bottom of the channel. Technicals can help determine good entry points when the longer-term fundamentals also point in the same direction, which I believe is the case for a bullish stance on gold.

What Is the S&P 500's Real P/E?

Tue, 10 Mar 2009 08:00:56 -0400

wooo, thank God there was someone to reveal the big PE conspiracy

Are Stocks Actually Cheap (And Is This a Good Time to Buy)?

Mon, 09 Mar 2009 15:44:14 -0400

The question "are stocks cheap?" is irrelevant by itself. You have to look at alternative uses for your cash, in particular bonds and other asset classes. You have to look at the return on risk-free investing (T-bill interest rate). At current levels of interest rates, stocks are very cheap, unless earnings collapse by another 50%. They got cheap because of a loss of confidence and because of forced selling/deleveraging by the banks and hedge funds. Some confidence, if the administration can indulge us, would boost the market 20-30% very quickly.

Jim Rogers Is Buying Farmland

Mon, 09 Mar 2009 15:28:33 -0400

what loss of economic leadership? Our economy is several times the size of theirs. We are in a recession now, but watch when we come out. The commies will go back to being commies and we'll go back to being the boss. If you're in denial about that, click the thumbs down riiiight here ---->

On Mar 07 03:20 PM JeffVader wrote:

> On Mar 07 01:17 PM Touva wrote:

Jim Rogers Is Buying Farmland

Mon, 09 Mar 2009 15:24:35 -0400

Jim will be the first farmer in a bow tie in a long time, may be since the Grapes of Wrath.

Can We Go Back to the Old Wall Street?

Mon, 09 Mar 2009 15:18:32 -0400

I think we should apply the partnership structure retroactively to companies that went public, so that all recent losses have to be eaten by the executives instead of shareholders and taxpayers. What makes sense more than that? They screwed up, they should pay for it, not other people, not shareholders and certainly not taxpayers while the execs sit on hundreds of millions. I bet Blankfein et al won't like this suggestion. Disgorge your 2007-08 bonuses, you didn't deserve any after say 2006.

The FDIC Is Broke...Or Will Be Soon

Fri, 06 Mar 2009 08:28:19 -0500

This is really a waste of space. More "contributors" like this and Seeking Alpha will also need a bailout.
Note to editors: clear out the trash, we are too busy for this.

The Good and Bad in Hedge Funds Today: A Manager's View

Thu, 05 Mar 2009 08:11:45 -0500

I am less sanguine than you about the future for two reasons:

1- the bear market has shown that a vast majority of hedge funds that outperformed in the good years did so either by pushing illiquid stocks upward (think small caps and emerging markets) or by using a lot of leverage.

2- the biggest scam with hedge funds has been the fact that they charge a performance fee on UNREALIZED gains (unlike private equity funds which charge only on realized gains). A manager who was up 20% in 2007 but down 30% in 2008 still walked away with a large compensation. High water marks are not sufficient for reasons you discuss, and in the future, there will be more clawback and escrow provisions so that a loss in year 2 will mean that the fee taken out in year one will have be partially or fully refunded to investors.

All in, I think the hedge fund business has seen its best days in a generation.

The AIG Scandal

Mon, 02 Mar 2009 20:14:52 -0500

I can't agree to that. Greenberg donated money to the hospital / maternity where my daughter was born. There is a big painting of he and his wife at the entrance, looking rich and generous (you know that look). It may be bad luck for all the babies born there if he goes to jail :)

Will the Euro Survive?

Mon, 02 Mar 2009 11:25:07 -0500

I do not wish the Euro to fail, I generally like Europe and Europeans. but if it does, maybe the Europeans will stop acting all superior. For a while there, they were celebrating our demise, and then the roof fell on their heads too.

Indians Are Selling Gold - Is Their Thinking Right?

Mon, 23 Feb 2009 09:48:36 -0500

While your prophecy may turn out to be correct, there is little analysis in this post. You present rising inflation and a continued bear market in stocks as foregone conclusions instead of arguing why events should unfold in this manner.

BTW the poor are never ripped off by the rich. Since they are poor, they have nothing to rip off. Maybe you meant the middle class...

Rick Santelli Speaks for the Silent Majority

Thu, 19 Feb 2009 18:25:54 -0500

The Driver, indeed ;)
and Obama is Wesley Mouch
When people in this country start a tax revolt, Atlas will have shrugged

ETF Update: Time to Look at China

Tue, 17 Feb 2009 11:45:33 -0500

Forget it. Bring your dollars home, the China story is over. Inflation is coming back to America and those dollars the Chinese hold will be worth less and less. The only bull market now is gold.

Infrastructure investing is an indication of PAST wealth, not of future wealth. Infrastructure is a low return investment (if not negative return) and the miles and miles of cranes only mean the economy did well in recent years. It does not mean continued prosperity in coming years.

Gold ETFs vs. Fort Knox

Wed, 11 Feb 2009 08:09:05 -0500

Interesting that the amount held by ETFs has gone up 50% in a year. Yet the price of gold has stagnated. Looks fishy.

iShares Switzerland Can Ease Portfolio Turmoil

Mon, 22 Sep 2008 14:12:28 -0400

keyword 'maybe' :)
You have to account also for the fact that a strong Swiss franc depresses earnings of Swiss multinationals

iShares Switzerland Can Ease Portfolio Turmoil

Mon, 22 Sep 2008 09:02:06 -0400

You are right about the swiss franc but the index usually moves in sync with other european indices. It is rare that it would diverge for long, whether that is justified or not.