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MMMPARSLEY1

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  • Gentex (GNTX) +5.9% premarket on a NYT report the U.S. government will announce that all passenger vehicles must include rearview cameras by 2014. Government statistics say 228 people, many of them children, die every year and ~17K are injured in backover accidents involving passenger vehicles. GNTX markets displays used in conjunction with rearview cameras in autos.  [View news story]
    More laws?

    Enough already.
    Feb 28 09:42 AM | Likes Like |Link to Comment
  • An Epic Australian Bust [View article]
    What about shorting Genworth? Don't they reinsure many of the loans the Aussie banks have on their balance sheet? Like AIG, wouldn't they be one of the first dominoes to fall?
    Feb 27 10:30 PM | Likes Like |Link to Comment
  • An Epic Australian Bust [View article]
    I was short EWA since 27.70, and made a healthy $28,800 dollars last year shorting it. It made up for my terrible performance in other areas and saved my investment year from negative returns - as I make my share of mistakes as well.

    I re-entered a short position recently after the expected stock market run after the Fed, in unprecendented lack of confidence, extended the promise to the world to keep ZIRP until 2014. After this Fed bubble, at some point the other side of the valuation equation will set it; The only reason assets are inflating is because central banks around the world are extremely bearish on natural forces expanding the money supply to avoid a nasty deflation cycle that puts governments out of business.

    Banks are being incentivized to loan out cash, but there is little demand in an already overindebted world. One safe haven is in the Australian currency which is strong for one reason only - it offers a 4.25% kickback per annum creating a positive feedback loop which keeps the underlying currency valued higher and ever more incentives to want a 4.25% kickback on the inflated value of the currency.

    Australia is unlike the US and other first-world economies in the sense that the economy rides on these external inflows to the country which allows the Australians to expand their ever-increasing indebtedness to foreign banks and individuals seeking to gain by finding a backdoor into the currency bubble. Hence a declining Australian dollar also means a declining Australia stock market and declining Australian home prices. In other developed economies usually a declining currency offers some support for the stock market as any foreign-earned income increases when converted back into their national currency. Australia has very little exporting and has been effectively priced out of the market. A declining Australian dollar just means money is flowing back to safer havens as artificial demans from a 4.25% interest rate discrepancy inevitably narrows.

    For those that think mineral deposite and natural resources can save Australia. Let's say they double resource sales to Asia... Now look at their housing leverage. The amount of household debt (including home) that the cumulative Australian economy holds is astronomically higher compared to a multiple of natural resource revenue per annum. Total exports per year add up to $213 billion dollars (now that's not profit, that's total revenue), which accounts for about 14% of total economic output. 75% of the workforce is in the service sector, so the Australian economy is still largely an economy which trades social services in Australian dollars inflated largely by the policy of temporary ZIRP policies around the world. The Australian Dollar as a store of value will sink violently once this coil unwinds - it will be fast and furious, and Australians will become some of the poorest on earth. Anybody owning a home with an average $320,000 dollar mortgage will be totally screwed. I don't even think this is a matter of conjecture - it's not a question of if it will happen, but when it will happen... because it WILL happen. It simply has to in order to correct the current global imbalance.


    W
    Feb 27 10:22 PM | Likes Like |Link to Comment
  • Economic Danger Signs Emerging In Australia [View article]
    Covered EWA - Did very well. Too much negativity in the markets - scared to be short with the building fear.
    Sep 20 11:18 AM | Likes Like |Link to Comment
  • Economic Danger Signs Emerging In Australia [View article]
    Great article, by the way.

    I agree on your thesis, but I'm confused why you are actually long an Australian Index Fund if you truly believe the scenario you laid out. If stock market weakness is a result of the weakening Australian commercial and retail building weakness, which I believe is an obvious correlation, why would you be long Australia?

    The major players in an Aussie Index Fund would be BHP, Rio, and a bunch of overextended banks that offered loans to customers that had little to no money down. As Australian's ability to lever prices up by leveraging their purchases to greater degrees wanes, I believe we will see a concurrent collapse of the housing market which will carry over into the stock market and the Aussie Dollar sometime in the near future.
    Sep 11 11:30 PM | 1 Like Like |Link to Comment
  • Economic Danger Signs Emerging In Australia [View article]
    Jack,

    Take a look into the average Australian's mortgage, which I believe is close to $300,000 AUD. Australia is able to temporarily service these mortgages while rates are low and while the mining business is still booming thanks to lots of speculative capital that have ran prices up.

    Asia and Australia are linked because as the Asian property and housing bubble collapses, so goes the historically high demand for the natural resources that Australia is able to generate. Right now, Australian truck drivers are making 6 figures in an inflated Aussie Dollar just to tow this stuff from mine to port.

    I expect massive Aussie Dollar weakness. Bear in mind I also believe the the US Dollar is actually going to strengthen. Yes, it's national debt is rather large, but during the duration of the US housing collapse the US has been able to service its debts without a problem. It will service it's debts for the foreseeable future.

    Australia isn't in as strong a position if revenue expectations fall short due lack of demand of natural resources and the consequent housing collapse - which I expect to be far worse than what has occurred within the US.

    I am short EWA and have been for 3 months.
    Sep 11 11:14 PM | 1 Like Like |Link to Comment
  • House Speaker John Boehner's debt plan is going nowhere, as it faces opposition in his own party and Pres. Obama threatens a veto. Sen. Harry Reid's plan, or a modified version of it, that even Larry Kudlow seems to like now appears to be the only remaining way out of the impasse.  [View news story]
    No, it's not spending. It's further debt which needs to end up being paid with additional debt or productive capacity gains that we are nowhere near achieving due to uncompetitiveness in wages in comparison to Asia.

    You can print all the money you want, but it will leak to Asia and you'll need to keep increasing the debt to pay for further government interventions until finally the currency is fully destroyed.
    Jul 26 09:50 PM | Likes Like |Link to Comment
  • Companies to Consider for Next Week's Earnings [View article]
    Robert,

    You used old data regarding EFUTURE.
    You seem to have checked a website without updated 2010 numbers.
    EFUTURE is actually growing at 27-32% per year if you took the 2010 numbers and not the 2009 numbers. The 5% range takes into consideration the time period at which you measure growth.

    EFUTURE invested into systems which makes its amortization high.
    Operating cash flow is about 3.2 mm.
    Net income, still not bad, is 914,000.
    Jun 9 06:57 AM | Likes Like |Link to Comment
  • Argentina on the Cusp of Hyperinflation [View article]
    I visited Argentina for 2 months and was appalled by all the inefficiencies in all economic areas that I participated. The prices for many staple items are often the same (if not more) than in the USA, but the customer service and value expectation is far less.

    Argentinians are a proud lot, but they are economically naive and expectant. After a few more years of suffocation due to continued loss of purchasing power not properly supplanted by the short-term delusion of the "wealth effect", I'm hoping Argentinians lose their pride and stop selling me shit quality products for a ridiculously high price while never accepting returns. You paid for it, you are stuck with it. That's the mentality! Ok, so I'll stick to traveling in the USA and Asia and never, ever visit your shop again.

    When you incentivize the status quo, things don't improve, businesses and individuals get complacent, and existing enterprises fail to compete internationally - driving down standards of living for everybody in the country.
    May 12 08:25 AM | Likes Like |Link to Comment
  • Recent Fed comments, including from Bernanke, suggest the Fed could move ahead with more asset purchases as soon as next month if the economic outlook remains weak. Janet Yellen and Sarah Bloom Raskin, both sworn in by the Fed board yesterday, are likely to be Bernanke allies on additional purchases or QE.  [View news story]
    Women as Fed Governors isn't exactly going to keep up internationally competitive.

    You can call me sexist, but although women's minds tend to last longer than men's, they tend not to be as powerful in making very complex decisions dealing with large sets of data.

    There is a reason that the free enterprise economy is dominated by men, they just tend to excel at the particular skill of managing large institutions. Now, there will always be some women who can do the job, but they will be few and far between.

    Chicks vs China in currency wars 2010. Eeek. We are definitely going to lose.
    Oct 5 10:58 AM | Likes Like |Link to Comment
  • China again raises the down payment percentage for purchasing homes and apartments in an effort to cool the country's housing bubble. The required down payment for a first home purchase rises to 30% from 20%. The government also says it will launch a trial property tax in some major cities.  [View news story]
    Will hurt real estate. Will help equities.
    Sep 30 10:13 AM | 1 Like Like |Link to Comment
  • Why Stocks Are Falling After Bernanke Testimony [View article]
    I'm under 30,

    I work hard and live WELL below my means.

    I make about $500.00 per weekday, and spend $40.00.

    Unfortunately, although I live in the USA, I find kindred souls mostly on my trips to Asia. Most people here don't know how to manage their money, and don't seem to like to be bothered with budgeting. Thinking gives most of the American softies I know brain cramps.
    Jul 21 10:03 PM | 4 Likes Like |Link to Comment
  • Market Valuation Dipstick Shows More Room to Run Higher [View article]
    Wade,

    No need to apologize. You were just making a point, cavalierly so, but who isn't guilty of being too cavalier in our speech or in our attempts to gain attention to ourselves.

    You did nothing that we don't all do from time to time when unloading our streams of consciousness from mind to keypad.

    Dave
    Jun 14 10:14 PM | 1 Like Like |Link to Comment
  • What Is Overstock's CEO Afraid Of? [View article]
    Fascinating Article.

    I love getting deep into these reports, but the work can be brutal, thanks for making more lucid the plight of overstock.com, as it tries to inflate its stock despite a pitiful balance sheet.

    BTW, at almost the exact moment this article was published, OSTK eroded all of its 9% gain for the day.
    Nov 4 03:44 PM | 1 Like Like |Link to Comment
  • Barron's says shares of private prison operators (CXW, GEO, CRN) trade at untenable discounts as investors obsess over states' stop-gap attempts to curb costs, and overlook prisons' steady profitability, and a widening gap between supply and demand.  [View news story]
    Untenable Discounts?

    Book values and P/E Ratios are about 1.5 and 15 respectively. Those are pretty average stats, certainly not enough to make these stocks a screaming buy.
    Oct 19 12:58 AM | Likes Like |Link to Comment
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