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  • Four Reasons the Attack on Short Selling Is Unreasonable [View article]
    When the SEC temporarily banned the shorting of financial stocks, how did that work out for you, Longinvestor?
    Apr 12, 2009. 04:40 PM | 3 Likes Like |Link to Comment
  • Attention Fund Managers: It's Time to Buy [View article]
    Kass said that November was the bottom FOR 2008. He was right. He seems to be right a lot.


    On Mar 06 02:39 PM OldLimey wrote:

    > Doug Kass also said that November was the bottom.
    Mar 16, 2009. 11:49 AM | Likes Like |Link to Comment
  • Housing Decline: Doug Kass Scenario of Major Economic Impact is Unlikely [View article]
    Wow--good call, guys.

    Mar 15, 2009. 12:52 AM | Likes Like |Link to Comment
  • How Innovative Is Oracle? [View article]
    Oracle's acquisition strategy is NOT a simple imitation of Cisco's. During the bull market of the nineties, Cisco focused on acquiring products rather than companies--Chambers acquired relatively early-stage startups and systematically avoided the challenge of integrating large organizations into Cisco. More recently, Cisco has made a few larger acquisitions, like Webex, but not anywhere near the scale of Oracle's purchases. ADP has another related strategy, but ADP tends to fire everyone and just migrate the customers over to its own products.
    Feb 27, 2009. 12:38 AM | 1 Like Like |Link to Comment
  • Gilead Sciences: Smart Company, Great Track Record [View article]
    Every time Gilead makes an acquisition, some commentators accuse them of overpaying. And every time, the acquisition turns out to have been an extraordinary bargain. Gilead is also a tremendous innovator in the structuring of partnerships. Working with Bristol Myers to put AIDS drugs from two separate companies into a single pill has been a huge win, both for the companies and for the patients. Because the excellence of the company's management is not well understood, investors have been consistently underestimating Gilead's growth for almost a decade.
    Dec 26, 2008. 12:17 AM | Likes Like |Link to Comment
  • Why We're Ignoring Big Stock Market Moves [View article]
    The statistics suggest that high volatility is associated not with major turns but with major bear markets.
    Nov 26, 2008. 01:05 AM | 1 Like Like |Link to Comment
  • An Optimist Looks at the Market [View article]
    Wrong, wrong, wrong, wrong, and wrong.

    1. Gas and oil prices are lower BECAUSE economies across the globe are slowing.

    2. The GDP growth number is entirely fictitious. If one applies a realistic deflator (5%? 12%) instead of a ridiculous 1.3% inflation rate, then economic growth is negative--and has been for over a year.

    3. The dollar is strengthening against the currencies of nations that are following us into recession.

    4. The once in a lifetime opportunities are probably on the short side. Citibank and GE will survive in at best a diminished form. Microsoft is a plausible investment, but it faces many real risks.

    5. Housing needs to drop another 15% before it reaches the historical average level of affordability. And it will probably overshoot on the downside. An average is not a floor.

    5.
    Sep 13, 2008. 03:24 PM | Likes Like |Link to Comment
  • A Continued Short Case for Automobile Finance Companies [View article]
    The one thing that holds me back from shorting Americredit is that Leucadia National owns a massive stake in it. Leucadia must be seeing something I don't.
    Aug 14, 2008. 05:30 PM | Likes Like |Link to Comment
  • A Short Update on My Four Short Ideas [View article]
    I have the same question User 5087 does. How can one successfully borrow stock in these companies? During the July rally, I managed to borrow a bit more DSL, but only by paying a steep negative rebate. Now I find that DSL, FED, BKUNA, and CORS are all impossible to borrow.
    Aug 14, 2008. 05:04 PM | Likes Like |Link to Comment
  • US Banks: The Good, the Bad, and the Ugly [View article]
    I must respectfully disagree. Readers who want something short and shallow can easily find it elsewhere.
    Jul 24, 2008. 05:18 PM | Likes Like |Link to Comment
  • News Flash: Major Market Turns Aren't Announced In Advance [View article]
    At the Value Investors Congress last November, I heard Tom Brown pounding the table for Marblehead and Rich Pzena saying Freddie Mac was the best value he had seen in his entire investing career. At the time, I had enough respect for both men to refrain from shorting those stocks. Oh well. It is a good thing that I have been betting against Downey, Wachovia, BankUnited, MBIA, Ambac, WaMu, Morgan Stanley, and Lehman.

    Tom knows an enormous amount about banks, and he was the top banking analyst on the street for seven years, if I am not mistaken. But he is clearly not objective in his assessment of this particular industry and the substantial risks it still faces.

    There is also something deeply wrong with the culture of American banking. The incentive systems all revolve around volume rather than credit quality. At Anglo Irish Bank, one of the best-run banks in the world, you could get fired for bringing the central credit committee several risky loan proposals. At the typical large American bank, you might well get fired for trying to derail an unsound but temporarily lucrative corporate loan. A friend of mine had this experience at Citibank. He was saved only by a last-minute downgrade of the credit rating of the potential borrower. But the bankers he was supporting never forgave him. They didn't give a hoot whether the loan defaulted somewhere down the road. All they cared about was meeting their quotas.

    It is possible that an investor might make money on some banks in the next three years. But why try to catch the falling knives and tomahawks when there are so many great companies, financial and otherwise, that don't have trillions of dollars of Level III capital and off-balance-sheet hanky panky? In the financial sector, I would point to Markel, Interactive Brokers, and CME, to name just a few. All three of those companies have managements that are not just prudent and ethical but visionary.
    Jul 24, 2008. 05:02 PM | Likes Like |Link to Comment
  • There's Been Major Deflation for Some Products [View article]
    You are exactly right, Lansingman. This superficial article relies on the ridiculous "hedonic adjustments" used in CPI calculations. It is true that the worst inflation is in services (healthcare and higher education, for example) and not in products. But the deflation numbers cited above are useless without an explanation of the (dubious) assumptions behind the hedonic adjustments for the perceived superior utility of today's products. If you want to see some serious discussion of deflation, which is now a real problem, check out the discussions at Minyanville and Mish Shedlock's globaleconomicanalysis...
    Jul 24, 2008. 02:12 PM | Likes Like |Link to Comment
  • Consensus Subprime Mortgage Loss Estimates: Mathematically Impossible? [View article]
    BBZZ24 makes a good point. With leverage of 20x or more on their balance sheets, many banks and investment banks would be destroyed by even a 5% reduction in total assets.

    Brown knows an enormous amount about banking, but his relentless cheerleading for the industry has cost him and his investors a great deal of money. And I suspect his rigid optimism will CONTINUE to cost him money.
    Jul 9, 2008. 05:17 PM | Likes Like |Link to Comment
  • Dendreon: The FDA's Commissioner Doth Protest Too Much! [View article]
    I agree that Pazdur has behaved in a criminally negligent and irrational manner, with Provenge and many other therapies. Unfortunately, though, the conflict of interest question may be a bit of a red herring. Most active researchers will have multiple corporate affiliations. There will be very few without any conflicts of interest. The conflicts of interest listed above (stock ownership, consulting relationships, funding for research) are fairly visible, but there are also many other less visible conflicts of interest, allegiances, etc. Can someone who spent much of his life or her doing research on chemotherapy offer an unbiased opinion about a cancer vaccine? It will depend on the individual. But you can't evaluate cancer vaccines without involving oncologists. The only solution is to create a culture of rational debate at the FDA, and to severely discourage the making of bad, self-interested arguments.
    Apr 22, 2008. 07:15 PM | Likes Like |Link to Comment
  • Biotech Stocks: Sector Outlook and Top Picks [View article]
    ZymoGenetics is certainly undervalued right now. The total market cap is less than the value of their approved drug, Recothrom, much less their pipeline. Their team has now developed seven approved drugs. If you think about the total number of new drugs approved in a given year, seven drugs is a pretty impressive number.

    BioMarin is also an excellent company, but as far as I can tell it is not quite as grossly undervalued as ZymoGenetics.
    Apr 15, 2008. 04:25 PM | Likes Like |Link to Comment
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