Nokia (NOK -8.1%) dives as it unveils the Lumia 920 at an NYC event. As expected, the Windows Phone 8-based 920 has a 4.5" display, supports wireless charging, and (perhaps critically) contains a PureView camera less impressive than the one in the Symbian-based 808. Also included is an augmented reality app called City Lens. Will this be enough for Nokia to gain significant ground against the iPhone 5 and Samsung's high-end lineup? (live blog) [View news story]
Market reaction is exaggerated. The new Lumias appear to be innovative, quality products. Who knows how well these Lumias will sell. Wouldn't be surprised if they're a hit, or at least sell decently. The drop off today is however so steep and out of whack, driven by massive short selling and speculative players, that one can pretty much safely assume that the stock will see a big bounce tomorrow as shorts scramble to profit/cover and in doing so trip over each other.
Zagg: 10 Times Earnings And The Shorts Are Sill Not Covering [View article]
I am not in love with many of the companies described in your article. LULU has been in a short squeezed for years, to be sure; however, it has also been ridiculously overpriced for years. However, in this environment I would not short any of these names, including LULU. There is too much liquidity in the system, compliments of the Fed, and these names could shoot up in no time and really hit you hard in the teeth if you are short. Not because the companies deserve their lofty valuations, but just because there is too much cash out there.
Technician Louise Yamada urges clients to keep stops tight as she watches equities with growing unease. "You could call it a vacuum rally," she says, characterized by short-covering, low volume, and deteriorating new highs vs. new lows. The lagging Transport Index (IYT) has her attention as well, but following this indicator kept some out of the big summer rally. [View news story]
Technical analysis is a form of withcraft, in my humble opinion.
QE3: No Details, But The Market Likes It Anyway [View article]
If you have a short position, you need to close it out right now. Folks with short positions are out in the open sitting on a fishing boat with a hurricane just around the corner. Even if the CEO of the company is a crook or the company sells ice to the eskimos, you cannot beat Hurricane Bernanke. Bring your ship to shore, and close out your shorts. This is a public safety announcement.
ECB Meeting: What To Expect And How To Position [View article]
Southern euro countries are not insolvent, with the notable exception perhaps of Greece. If you however charged the US govt the same interest rate on its debt that panicky investors require from Spain or Italy, it would be inches away from insolvent (unless of course Bernanke, with a magic wand, decided to monetize its debt).
Just a reminder that no matter how skilled you may think you are as a short seller, you should never bet against the guy with the bigger guns: The Fed. You may think that the stock of a particular company is overpriced, but if you discount the company's cash flows at an interest rate of 0% is it really so overpriced? The Fed is telling you to go long, so by jiminy you should go long.
ECB Meeting: What To Expect And How To Position [View article]
The moves against the German bunds will be brutal as the ECB plan materializes. German bunds are grotesquely overpriced, with tiny yields, and some recent auctions have seen negative nominal yields. When a bond hits a zero yield, you pretty much know that the run up in prices is over. I mean, how could it not be? The herds of panic-stricken euro currency investors have nowhere to go, and will be pushed back into risky assets or periphery debt. A muscular ECB response will just turn what would be a gradual process into a stampede in reverse. I would steer clear from Geman debt (particularly long bonds) at this stage.
Revamping Your Bond Portfolio With A Simple Momentum Strategy [View article]
Your momentum strategy is interesting, but I'd rather stay out of the long T-bond market altogether. Fed policy is to intentionally make the long T-bonds as toxic as possible, to push folks into risky assets. Long T-bonds are nose-bleedingly expensive right now, with yields well below inflation. When the Fed exits the market for long T-bonds - or, worse, when it starts selling - watch out below.
No, hold your long T-bond for its entire term and there will be no capital gains. You will end up with a bunch of miserable, tiny coupons and a principal that on an inflation-adjusted basis is worth much less than your initial investment amount. Only if you can dump the stuff down the road on somebody else (maybe the Fed (?)) in a game of musical chairs will you see so-called "capital gains". There is little fundamental value in long T-bonds at today's prices.
Vale: Don't Miss This Buy Opportunity [View article]
The answer is that prices may go lower, but they will eventually rebound. Short-sighted investors are dumping Vale as if iron ore prices were permanently anchored at the bottom. If you hold Vale for at least 1 yr you may see gains on your position in excess of 100% as the price of iron ore (and the price of the stock) reverts to norm.
Good Dividend Payer BreitBurn Energy Partners Brightens Its Future With New Oil Asset Purchases [View article]
You got a tough audience, but nobody really questions the basic premise of your article - an investment in BBEP is a solid investment. The company has good prospects and sound fundamentals. You did not mention this, but BBEP has an unusually low P/E ratio for an MLP. Profitability is of course a plus, although in the MLP context the investor unfortunately directly bears the pass-through tax consequences!
Good Dividend Payer BreitBurn Energy Partners Brightens Its Future With New Oil Asset Purchases [View article]
One of the best entry points for BBEP and other dividend/distribution payers is right after the effective date of a dividend/distribution. Many people dump the stock right after the dividend/distribution becomes effective. The fall in the stock is typically more than the dividend/distribution amount.
Treasurys extend a big 2-day rally following the FOMC minutes, the 10-year yield off 8 basis points to 1.71% (after nearing 1.9% yesterday). If the Fed is truly going to launch QE3, bond bulls (and bears) should take note because past QE episodes have sent Treasury prices lower. [View news story]
At these price levels, long-dated T-bonds are the idiot's version of greed - great risk for no reward.
Nokia (NOK -8.1%) dives as it unveils the Lumia 920 at an NYC event. As expected, the Windows Phone 8-based 920 has a 4.5" display, supports wireless charging, and (perhaps critically) contains a PureView camera less impressive than the one in the Symbian-based 808. Also included is an augmented reality app called City Lens. Will this be enough for Nokia to gain significant ground against the iPhone 5 and Samsung's high-end lineup? (live blog) [View news story]
Zagg: 10 Times Earnings And The Shorts Are Sill Not Covering [View article]
Technician Louise Yamada urges clients to keep stops tight as she watches equities with growing unease. "You could call it a vacuum rally," she says, characterized by short-covering, low volume, and deteriorating new highs vs. new lows. The lagging Transport Index (IYT) has her attention as well, but following this indicator kept some out of the big summer rally. [View news story]
QE3: No Details, But The Market Likes It Anyway [View article]
ECB Meeting: What To Expect And How To Position [View article]
Bernanke Doubles Down On Fed Put [View article]
ECB Meeting: What To Expect And How To Position [View article]
Bernanke Doubles Down On Fed Put [View article]
Revamping Your Bond Portfolio With A Simple Momentum Strategy [View article]
Long-Term Treasury ETFs: Ultimate QE3 Play? [View article]
Long-Term Treasury ETFs: Ultimate QE3 Play? [View article]
Vale: Don't Miss This Buy Opportunity [View article]
Good Dividend Payer BreitBurn Energy Partners Brightens Its Future With New Oil Asset Purchases [View article]
Good Dividend Payer BreitBurn Energy Partners Brightens Its Future With New Oil Asset Purchases [View article]
Treasurys extend a big 2-day rally following the FOMC minutes, the 10-year yield off 8 basis points to 1.71% (after nearing 1.9% yesterday). If the Fed is truly going to launch QE3, bond bulls (and bears) should take note because past QE episodes have sent Treasury prices lower. [View news story]