Jeroen

Thursday Outlook: Commodities, Global Markets

All the best, both in spirit and in body, to Francie, you and your close ones. Your posts are always appreciated and thank you for sharing your personal story. Take good care,

Jay

Friday Outlook: Commodities, Global Markets

Great chart overview, on the daily menu. Thanks.

Is the S&P 500 Now Cheap?

Aren't earnings naturally cap-weighted? - a $90 bln dollar company makes $5 bln in earnings and a $10 bln dollar company makes $500 mln in earnings. So a cap-weighted index comprised of these two companies would have a value of 100 with 5.5 in earnings. If I would own these two companies outright, I would make $5.5 bln. in earnings, and not: ((0.9* 5 bln ))+ (0.1* 0.5 bln)) = $4.55 bln. Where does the other 0.95 bln. go? Sounds like black hole accounting....

It's not about weights, imo, but about normalized earnings vs non-normalized earnings.

ETF Investors Mistakenly Stock Up on USO: Buy USL Instead

What are your thoughts about DXO (double long oil), which is long June contracts. Do you consider that also a decent alternative to USO (btw, note that USL volume is very thin, with wide spreads) ? Thanks in advance.

www.powersharesetns.co.../

Time to Buy Market Vectors Gold Miners ETF?

Looking at the ratio gold/platinum, it also shows a relative departure from historical values, which implies the relative underperformance of gold. If you'd choose an unhedged position, it's important to be sure which factor in the ratio will be the driving force: the numerator declining, or the denominator increasing.

See stockcharts.com and fill in $gold:$plat for the ratio chart.

Paulson Trying to Rewrite His Own History

Thanks for calling him out.

Is Hansen Natural a Value Trap?

Alexander, nice analysis. I believe your duopoly remark is key in how HANS is/should be perceived.

Another shortcut to valuation: even in a status quo/ no growth, without any international expansion, HANS could pay out an annual dividend of about $2 per share, without harming the business. Applying a 5% dividend yield (which not many strong stocks are yielding, even now) implies a price of around $40.

Big Troubles for the Euro

Talin,

-the Dutch government bought a decent bank (ABN AMRO/Fortis Netherrlands) at a decent price, which can be privatized in a couple of years. The dividends will pay for the interest payments, and it's unlikely tax payers will have to take a loss.
-the Belgian government will own 10% of BNP Paribas (large European bank, through a stock swap, in which BNP took over Fortis Belgium.

With all the government intervention we will never know what the cost to the taxpayer would have been without intervention. It's probably choosing for the lesser of two evils, no perfect solutions.

Energy Drinks Are a Business, Not an Empire

condoguy,

What Inbev's intentions are going forward is hard to say, and I don't have any special knwoledge about it. All I can say that the business case for selling these high margin and popular products seems compelling. The challenging part probably will be the entrenched position of Red Bull, especially in the on-premise channel.

The fact that Anheuser-Busch, as it is still in the process of being taken over by Inbev, already set up a non-alcoholic beverage unit (9th Street) seems interesting. Through this venture, and obviously with Inbev's backing, they're going to capitalize on the market for waters and energy drinks (including Monster). So this would imply that these products, and Monster, do have their attention. I wrote a post about this, which you can read here:

monsterfinance.wordpre.../

Hope this helps, feel free to ask,

All the best,

Jeroen

Fannie And Freddie Only $25 Billion! Act Now While Supplies Last

Uncle Sam to U.S. taxpayers: "uhhm, yeah.. we're gonna need those rebate checks back...Little glitch in the system, it wasn't supposed to happen. Oh yeah, Fred and Fan say "hi" ..."

Shorting the Homebuilders as Their Stocks Surge

news.bbc.co.uk/1/hi/pr...

"Average annual earnings in Germany and Britain are similar: £20,981 (euro30,984) in Germany compared to £22,950 in the UK. "

"The average house price in Germany is £148,971 (euro220,000), whereas in Britain it is £196,893. "

Shorting the Homebuilders as Their Stocks Surge

Although the relative value (Europe/US) argument might have some merit at first sight (yes, real estate is expensive everywhere, and e.g. Spain/UK are in trouble), if you want to do a realtive bubble comparison you also have to take into account savings rates, tax law, quality of construction, job market, debt service ratios. And the resulting prices in dollar-terms, might say more about the relative value of the dollar, than the property market per se.

Remember The 3-Alarm Sell Signal?

According to your article the MS Sell Signal came in at June 4th 2007, but you put it in the chart on June 4th 2006, from which you draw your conclusions. So your comments don't make any sense. On June 4th 2007 the S&P 500 closed at 1539, close to the top (1576, October 11th 2007), so MS was pretty much spot on.

Remember The 3-Alarm Sell Signal?

According to your article the MS Sell Signal came in at June 4th 2007, but you put it in the chart on June 4th 2006, from which you draw your conclusions. So your comments don't make any sense. On June 4th 2007 the S&P 500 closed at 1539, close to the top (1576, October 11th 2007), so MS was pretty much spot on.

Garmin: The Master Negotiator

Also note that, before GRMN made their counterbid for Tele Atlas, they had accumulated 5% of Tele Atlas shares. So they made a nice trading profit as well.

www.afm.nl/registers/r...