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jstratt

jstratt
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  • Strategy To Short Bank Of America [View article]
    I take a different view.

    I am glad you only think the Mortgage risk is $52 billion. I think it is higher. However the 684 Billion in Cash on the latest balance sheet should be able to handle that.

    I figure worst case BAC spins off Merrill Lynch to pay mortgage liabilities and remains an incredibly big profitable bank.

    It should be clear that the government is not going to allow a TBTF bank fail!

    I believe we are nearing an endgame on mortgage liability and have been loading up on BAC at $5.50 average cost.

    BAC has been very very good to me. In late 2007 sold all at $50+ because who wants to hold a bank when a crisis is coming. In Mar 2009 bought it back as low as $3.83 and sold above $10.

    Investors should keep room to buy more at lower prices but failing to buy some BAC in the $5 range could be a mistake.
    Dec 7 09:58 PM | 1 Like Like |Link to Comment
  • We need to stop bashing rich people and big business, says Jamie Dimon. Our country is the greatest in the world, and our businesses are world class institutions that provide a wealth of products, employment and services. Our focus should be on dealing with the "bad apples" in the bunch, not denigrating entire institutions. Owning a big business doesn't make you evil, and just because you're rich, doesn't mean you're bad. (audio)  [View news story]
    Jamie you are an accomplished CEO and I commend you for you work.

    However try to understand that with huge political contributions you created a situation where you and your cronies made billions. The problem is you then left citizens holding the bag when things went south.

    By the way I would like to know what you think about
    a) Dynasty Trusts
    b) Carried Interest
    c) Government buying Banks out of trouble and assigned the debt to taxpayers
    d) Picking the worst Mortgages, packaging them up and selling them to our pension funds without disclosure
    e) Having government officials disclose insider information to TBTF banks to profit
    f) Gosh some say you were invited to the table to decide the fate of other institutionsg) Perhaps some of us mourn the passing of a rule of law for the morals that would shame a banana republich) Also I dont want to forget to add that a revolving door of Banksters are installed in government. Timmy, Hank... Some probably think they are representing the nation, but not many.

    Please excuse the few of us who see outrageously excessive unfair advantage given to the privileged few. It is not your success I care about, rather the sale of the USA by fraud and deceit.
    Dec 7 09:42 PM | 4 Likes Like |Link to Comment
  • SAP Finally Buys SuccessFactors - But Is It Too Late? [View article]
    Thanks for an excellent article!

    I find it hard to believe SAP will be able to monetize this transaction.
    Dec 5 06:43 PM | Likes Like |Link to Comment
  • Alarmed by talk of increased Western sanctions that could reduce or even halt its oil exports, Iran warns crude oil prices could surge to at least $250/barrel. The warning is part of Iran’s attempt to intimidate its adversaries, and it could be working: European fears grow that new sanctions would hurt themselves more than they would hurt Iran. Crude prices finished with only slight gains.  [View news story]
    Iran is causing the price of Oil to rise which helps them defeat the effect of any sanctions.

    If I was Iran I might pay somebody to come out and predict $500 Oil tomorrow. That statement would have just as much credibility as the $250 statement.
    Dec 5 06:22 PM | 1 Like Like |Link to Comment
  • Income Investor: It's Time To Buy AT&T [View article]
    With a significant investment in T, I follow it quite closely. It is very hard for me to balance the prospects for T with this article.

    Questions

    1) How does T grow its dividend by 10% and grow earnings over the next 5 years by 2.9%. Especially given a current 87% dividend payout.

    2) What is the fair price for a company whose past 5 year earning growth has been -4.17% and has a projected 2.9% 5 year growth rate.

    I purchased most of my T at 24-25 with a 6.6-7.0% payout. Essentially it has been my alternative for a bond. Personally I value T as a $30 stock value.

    The past few months have been a great time to diversify telecom portfolio holdings into VOD and FTE which with all the EURO problems were yielding 7.5 - 9%. Both are quality long term companies with high yields and growth potential.
    Dec 5 06:03 PM | 5 Likes Like |Link to Comment
  • SAP -1.3%, and SuccessFactors (SFSF) +52%, following the former's deal to acquire the latter. Matt Marshall gives 9 reasons why the deal is a smart one for SAP. Among them: the quality of SuccessFactors' products and management; the growth of the talent management software market; complementary customer bases; and the potential for integration with SAP's back-end software.  [View news story]
    The apple didnt fall far from the tree. SAP is paying a huge price for SuccessFactors.

    It is easy to see where Leo Apatheker got his training. I fear SAP will have the same results as HPQ had with that strategy in the past 2 years.

    PS I may have misspelled Leo's name. I am still trying to forget him.
    Dec 5 05:35 PM | Likes Like |Link to Comment
  • Targeting A Retirement Income Level From A Dividend Growth Portfolio - Part 1 [View article]
    Outstanding article!

    I have constructed similar spreadsheets reaching out until 90 years as well using a wide variety of different assumptions. I usually focus on Total Return rather than dividend growth however even though I invest in dividend stocks.

    I am suspicious about projecting 10% dividend growth long into the future since I dont see most of the underlying stock examples growing earnings at that rate. However your model is an excellent lens to add in forecasting future income and assets.
    Dec 5 05:17 PM | 3 Likes Like |Link to Comment
  • MF Global: One Possible Explanation Where Customers' Money Went [View article]
    SEC changes apparently now allow the usage of customer cash as margin. Does a rule of law even exist in the US anymore?

    Corzine is similar to Bernie Madoff. Notice the difference in treatment.

    After looting clients it appears what he did may have been legal? No wonder the government is stalling. You cant honestly believe the government has been unable to follow monetary flows.
    Dec 5 10:37 AM | 2 Likes Like |Link to Comment
  • Why Hewlett Packard Is A Buy [View article]
    Just a few points to consider!

    1) Whitman lowered expectations greatly and most likely will be able to meet such excessively minimized forward earnings expectations.

    2) The Board of Directors is a disaster and likely the worst Board in the history of Corporations.

    3) For long term investors PC's, Printing and other businesses seem to be future decliners rather than not growing as the author suggests.

    4) HPQ had a CEO that was leading them out of disaster and the Board was so jealous and upset at his accomplishments they turned on him. It took him 5 minutes to get another job while HPQ has been reeling ever since.

    5) Leo in my opinion was wanting to sell the PC division because he wanted to merge HPQ back into SAP. That would never be accomplished with a PC division.

    In conclusion HPQ is likely undervalued and could be purchased and sold for a decent profit. However long term it probably doesnt do well in and industry that isnt kind to its elders and a leadership team that makes the Titanic look like a success story.
    Dec 2 08:34 PM | 3 Likes Like |Link to Comment
  • Vodafone: Great Defensive Stock With A Big Dividend Yield - Part I [View article]
    Great article!

    For the past 3 months I have been adding VOD shares. The Euro crisis has pushed VOD down to great buying prices and it is a worldwide company.

    For investments in telecom VOD and FTE have been very attractive over the past quarter. The authors analysis provides valuable insight and perspective.
    Dec 2 08:01 PM | Likes Like |Link to Comment
  • Credit Suisse Positive On U.S. Equities Longer Term But Negative Over Next Few Months [View article]
    I think the translation is stocks are cheap but we could have a catastrophe.
    Nov 29 08:56 PM | Likes Like |Link to Comment
  • Bank Of America: Profit With Little Risk [View article]
    This is an interesting post. I agree with the author but find his logic faulty. A faulty understanding of the Buffett deal and the risks facing BAC are the points

    I find BAC to be a great value but not one without risk! My guess is BAC will be at $10+ within a year. In order to get there however a mortgage settlement that does not include fraud will have to take place regarding some of Angelo Mozillo's finest work.

    Everything is on hold until the resolution of the mortgage issues. Once they are quantified, BAC can raise the capital the government is demanding. I cant help but think the resolution may be a sale of Merrill Lynch with proceeds satisfying Mortgage obligations. Otherwise they might have to sell so much stock that earnings would be minimal.
    Nov 29 08:29 PM | Likes Like |Link to Comment
  • Adam Smith Was Right: Excess Profits Get Competed Away [View article]
    I would add that Adam was correct in his world.

    In the current world, financial companies contribute 500 Billion to politicians to ensure that doesnt happen. The results have been quite advantageous for them. Taxpayers pay the losses and financial entities keep the gains.
    Nov 26 10:32 PM | Likes Like |Link to Comment
  • The Case For Amazon To Beat The Rest Of The 'Gang Of Four' [View article]
    I nominate Bezos for the Slick Marketer of the decade award.

    With little in profits for the past 15 years he has fools paying huge multiples. Even after a crash the fools rush in.

    Remember DBC = Dont buy crap!
    Nov 26 10:21 PM | Likes Like |Link to Comment
  • Europe's Insoluble Problems [View article]
    I would make a few observations.

    > The Euro while in danger may not fail. Causing the Euro to drop and having the rest of the world support it to save their own economies is a smart move.

    > el Erian is always going to take a position that would suggest one should buy bonds thru PIMCO funds. He is primarily marketing PIMCO thru the free publicity of his interviews. I am not overly impressed by him.

    > As the world prepares for a collapse the likelihood decreases. It is the sudden collapse of a Lehman type institution that is not prepared for that causes the most damage.
    Nov 26 10:14 PM | 2 Likes Like |Link to Comment
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