pochovilla

Bank of America: Smarter Than We Think?

BAC buying CFC is similar to buying a house that failed the termite inspection. In the long run it might be worth it. But it could be a slow and expensive process.

Is the Minimum Wage Increase Behind the .50% Jobless Rate Jump?

I heard this on Kudlow on Friday night. It's a political statement to blame Congress (Democrats) for unemployment. What about higher costs (not including labor) and fewer customers. Most businesses that would hire the 16-19 yr old age group plus college students were already feeling the pinch. College graduates entering the workforce are also finding jobs more difficult to secure. We are seeing the impact of real inflation mostly from higher oil prices. The impact of minimum wages may be a factor in "youth" unemployment but not as nearly as much as the author implies.

Ben Bernanke: Talk May Be Cheap, But It's Not Worthless

It's worth a buck in Europe before exchange rate conversion fees.

How Bad Is the Oil Shock of 2008?

The effects of "economic cleansing" that antiseptic term of economists:
Airline Industry: higher prices, grounded planes and layoffs and more bankruptcy or consolidation.
Trucking Industry: Independent truckers are having their rigs repossessed and becoming an endangered species.
Hotel/Travel/Entertain... Industry: Feeling the pain
Real Estate Industry: Very painful
Living in the suburbs with 1 hr + daily commute in SUV or truck with no public transportation. Becoming a credit card nightmare by living at the edge of the credit line.
So much more without the sticker shock of food prices.
Anyone for watching "happy Days" on DVD?

How Bad Is the Oil Shock of 2008?

The effects of "economic cleansing" that antiseptic term of economists:
Airline Industry: higher prices, grounded planes and layoffs and more bankruptcy or consolidation.
Trucking Industry: Independent truckers are having their rigs repossessed and becoming an endangered species.
Hotel/Travel/Entertain... Industry: Feeling the pain
Real Estate Industry: Very painful
Living in the suburbs with 1 hr + daily commute in SUV or truck with no public transportation. Becoming a credit card nightmare by living at the edge of the credit line.
So much more without the sticker shock of food prices.
Anyone for watching "happy Days" on DVD?

How Bad Is the Oil Shock of 2008?

The effects of "economic cleansing" that antiseptic term of economists:
Airline Industry: higher prices, grounded planes and layoffs and more bankruptcy or consolidation.
Trucking Industry: Independent truckers are having their rigs repossessed and becoming an endangered species.
Hotel/Travel/Entertain... Industry: Feeling the pain
Real Estate Industry: Very painful
Living in the suburbs with 1 hr + daily commute in SUV or truck with no public transportation. Becoming a credit card nightmare by living at the edge of the credit line.
So much more without the sticker shock of food prices.
Anyone for watching "happy Days" on DVD?

Pharmaceutical Facts Investors Should Know

Don't worry about big pharma. They own the FDA. Over the next ten years at least 100 new syndromes will be created to maintain a healthy profit as millions of American's will be convinced that they have "restless brain syndrome" among other things.

Inflation: It Could Be Worse - A Lot Worse

Another brilliant piece of analysis. I think the Alpha bloggers should recommend this man to be the Department head of economic analysis to the next President "Alice in Wonderland"

A Simpler Explanation For Bill Miller's Losing Streak

David: From past Bill Miller contributions to Seeking Alpha, I don't think you'll find many Bill Miller fans. Most comments are very negative. His track record over the past 5-8 years vs S&P is pretty dismal considering investment fees. It also appears he is married to too many financials to the detriment of Legg Mason investors. Apparently he keeps smiling because he make very good money.

Weekly Street Sentiment: Facts Are Stubborn Things

The attention span of the average person is about ten seconds. The herd moves on "headlines" and 10 second snippets without context. Except for a rare few (Kill the messenger) who can put meaning behind the "data" or "possible facts" the pundits grab 90% of the headlines.
Consider the following:
"It's hard to change people's minds with facts" Thomas Sowell

“The market can remain irrational longer than you can remain solvent.” - John Maynard Keynes
As I tell my daughter in Manhattan, "My advice and $10.00 may get you a cup of coffee at Starbucks"

Will Sprint Become the Wireless Company of Choice?

Just need to involve Circuit City and BlockBuster in this deal to make it near perfection.

Gas Is Actually a Bargain at $3.56

Mark just thrives on having a conclusion and finding a chart to support it. Similar to Larry Kudlow, he only tells one part of the story. End of discussion. Goldilocks skips along. While it is true that passenger cars have improved in mileage and reduced emissions over the last 40+ years, there's always the "BUTT" part of the story:
1. Families have more cars
2. Distance traveled between home and job has increased.
3. The number of SUV's and light trucks in 2005 compared to "passenger cars" is "somewhat" higher than in 1970, 1980 and 1990.
4. Demand is largely inelastic. Refiners report about 1% less gasoline usage over the past year and about 10% increase in diesel.
5. If EPA gas mileage statistics are used in the EIA data than the most recent statistics are overstated. Excuse me; all of us in "Seeking Alpha" land accept government data as absolute truth.
6. GM has just introduced a "green" 5800# Yukon EPA 20 mpg highway, real number closer to 18 for only $60,000 sticker. Now isn't that a "sticker"? Price and mileage.

There are at least two real issues here:
1. The "gas tax" effect on disposable income is significant and is creating serious pain for a large part of the population and particularly to independent truckers who are facing repossession and bankruptcy. It's too bad they can't make normal load/deliveries in a 22 mpg passenger car. However, I would observe that anyone part of the new "middle class" making $125,000+ per year may rationalize $3.56/gallon for gas as historically "fair" but not necessarily a "bargain". It depends.
2. Because the US imports most of it's oil the trade imbalance continues to stress the value of the dollar. If debt doesn't matter then this is not an issue.

Final thoughts:
If Gas at $3.56/gal is a bargain:
than is Gas at $4.00/gal fair value?
and does Gas at $5.00/gal cause a bit of concern?

The people in California or in Great Britain can't answer the question without prejudice. If you are a CNBC talking head and only ride inside a limo or your name is Hillary Clinton and just paid $60 for gas for a trucker in Indiana (first time she paid for gas in x years) then you can't vote either.

How Long Until the Housing Market Recovers?

Any mortgage comparison to the 1990's and less so in 2000 that speaks to % of income to service a mortgage compared to 2008 misses the "this time it's different" part of the story. Those little details about paying insurance , taxes and household utilities can only be ignored if you're on the sell side. If you're on the buy side it's a different story. Even if you have owned a home since 1990 and paid off the mortgage I would bet your monthly "expenses" are a mortgage by themselves.

Our Energy Efficient Economy Can Handle $112 Oil

research.stlouisfed.or...
1950 GDP = $315B
2008 GDP= $1400B
5th grade math indicates 1400/315= 4.45 larger GDP with an improvement in energy efficiency of ~19/8.78= 225%. Another way to look at relative to 1950 4.45/2.25 = 1.97 or 197% worse per dollar of GDP.
I am convinced Mark Perry is looking to replace Larry Kudlow on CNBC. He only needs a blond wig.

Circuit City: Simply Appalling

This horse needs to be shot before the vultures pick it clean. At least a couple of pounds of dog food can be recovered.