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    • Mon Apr 14th 00:16 AM | Rating: 0 0
      Commented on:
      The Realities of Natural Gas
      That was for Georealist.
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    • Mon Apr 14th 00:15 AM | Rating: 0 0
      Commented on:
      The Realities of Natural Gas
      Oh, and yeah. Buy some UNG or GAZ.
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    • Mon Apr 14th 00:08 AM | Rating: 0 0
      Commented on:
      The Realities of Natural Gas
      My take on this was that, while nat gas would appear to have been seen as a more cost effectively integrateable alternate electricity generating fuel than it will probably actually be, nat gas itself is going to be as subject to supply/demand problems as oil is, making large scale investments in new production facilty construction, or existing facility conversion, less cost effective than here-to-for supposed. As nat gas catches up to oil in overall btu-kwh cost, these largescale investments lose much of their economic appeal. The article totaly ignored the peripheral, but very important aspect of nat gas's cleaner impact on the environment, compared to oil or coal. Some perspective on the investment cost of expanded nat gas usage compared to renewable's would have made the article more pertinant. My final takeaway was that nat gas is going higher, but it's higher cost will negatively impact it's consistant run-up, causing similar pullbacks in price due to reduced demand at times. What the "powers that be" choose to do by way of furthur infrastructure investing may well have a more negative than positive overall effect on the macroeconomic landscape than those same "powers that be" are capable of understanding. The regulatory approach issue will, of course, be a cluster****. So whats new?
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    • Sun Apr 13th 23:17 PM | Rating: 0 0
      Commented on:
      Ultra and Inverse ETFs: The Downside of Doubling Up
      It's odd how the returns for the SSO/SDS ultra's seems to miss the doubling result when the return is positive, but meet or exceed the doubling when the return is negative. Friday results illustrate this perfectly, albeit anecdotaly. SDS went up 3.32% in a downtrend day, but SSO went down 3.89%. SPY was down 1.94% I haven't figured out the why of this, but it does hold up, mostly. Random day historical evaluations of QLD/QID are better correllated, on average, for some reason. I use the ultras as very short term trades, with tight trailing stops for losses. (Accepting small losses in pursuit of exaggerated gains.) Works pretty good. Averaging returns of about 3%/week, since the start of the year. Not too bad, IMHO. But, I'm only putting about 25% of my portfolio value on one of these 4 ETFs, on any given day, and rarely holding past the end of the day. Anybody else here doing something like this? QID had a +26.5% return for 1/2/08-3/31/08 continuous hold. SDS +19.2% same/same. I did +39% (+32% after trade costs.) Probably get my ass handed to me Q2.
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    • Thu Apr 10th 04:32 AM | Rating: 0 0
      Commented on:
      Rising Global Food Prices: Trading Guns for Butter
      Ah, Mary. Your Democrat stripes really came through w/ that last line/diatribe. Firstly, Bush doesn't run the govt., the Congress does. And the Congress is comprised of primarily spineless toadys, on both sides, that do as their told by lobbyists, the most powerful of which is the banking sector. Secondly, the most likely economic scenario is due to both Reps and Dems unwillingness to face reality, and institute an energy policy that could have already put us in a position of near energy indepencence. When nothing changed after the late '70's oil embargo, rationing, etc., it should have been clear that the tough choices were never going to be made by the politcal leadership of either party. But let me guess, you're going to vote for whatever Dem candidate, regardless of their demonstrated propensity for socialist programs and politically expedient pandering, right? I can't wait till Obama is elected, and can short the market across the board, with an almost 100% probability of great returns for the next few years.
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    • Thu Apr 10th 03:22 AM | Rating: 0 0
      Commented on:
      Consumer Sentiment: Always Darkest Before the Dawn
      And if you think globally, wait until serious food shortages start hitting under-developed populations, followed by emerging market populations. (Think North Korea, China.)
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    • Thu Apr 10th 02:48 AM | Rating: 0 0
      Commented on:
      Combating Financial Illiteracy
      "The thing that worries me the most would (be) if a national financial literacy program was aimed at giving people answers and/or blueprints, as opposed to teaching them how to think." -
      That skillset is rooted in the use of logic, and that's the one thing that is rarely taught in school. Why Rudolph Carnap is not required reading (or at least some abbreviated synopses thereof) starting in middle school, is beyond me. The constantly reinforced notion that emotional gratification is the primary goal of existence has served to make the average human being a slave to that desire.
      You're right, Mr Lee. It's just math, and logical consideration of consequences. Of course, math has become the #1 skill that is most lacking in the general population. Asked anybody under 30 to figure a randomly chosen percentage of any number bigger than two digits, lately? It's scary how many people don't have an even basic understanding of anything more complicated than simple addition/subtraction. ARM's, point spreads, floating rates, etc.? Please!! The odds of making a bad decision are way more, than that of making a good decision, for those that "just don't get" math, and aren't in the habit of using logic in their decision making process. Sometimes I think the lending community is relying on that, especially the credit card companies.
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    • Thu Apr 10th 01:00 AM | Rating: 0 0
      Commented on:
      Wednesday Outlook: Commodities, Emerging Markets
      The bears are less exhausted than some might think. Range trading is boring, but .5%-1% per day profit adds up quick. When the spindoctors' spiel finally gets blown out, and reality is driven into the bull's face, us bears are gonna eat some lunches.
      Love your reports, David! It's my favorite read on SA.
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    • Wed Apr 9th 01:06 AM | Rating: 0 0
      Commented on:
      The Fed May Get It Wrong, But Don't Let It Get to You
      I wish I could have a different plan. Re beating the market average: done that every year since I started actively investing, the last 5 years. Have averaged 22%, but that was, of course, during the last bull run, and being totally invested in emerging markets. Not sure how you came to the conclusion that beating market averages of 10% is hard, unless your risk tolerance is way lower than mine. My point was to the fact that it's the 50ish crowd that is going to have the hardest time in this downturn cycle, especially if the cycle is longer and deeper than is being currently hyped as the "most likely" scenario. Which I don't buy into. Appreciate the response, tho.
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    • Tue Apr 8th 01:09 AM | Rating: 0 0
      Commented on:
      The Fed May Get It Wrong, But Don't Let It Get to You
      In as much as "freaking out' is never a useful response to any bad situation, a fifty year old saving for retirement at a normal age (62), who needs a 15% year-on-year return for the next 12 years (to have the kind of nestegg that can be seen as "insulating"... i.e. me,) definitely has cause for concern. The odds of 15% (as a reasonable expectation) have become much less likely, and not just for the next few months. More likely not for the next 5 years. Depending on the depth and length of this current downtrend, the need for truly stellar returns in the remaining years after the recovery becomes more and more necessary, and at the same time less and less likely. As much as I would love for it not to "get to me," it does. Big time. I have no illusions about risk/reward ratios and the like, but lets face some facts, here.Those who have had the time to build their nestegg, and are now in conservative mode (already retired,) and those that have a much longer time horizon to recoup from this sort of protracted lower-return market (the young) are in a whole different world than the group you seem to be addressing this article to. It is exactly that "50ish" group that is going to have sweat this cycle the most. Having a significant portion of the current nestegg devalued to the tune of 15%-50% (their home) with no real expectation of recovering much of it by the time they retire doesn't improve the attitude much, either. The recommended defensive posture must, by definition, be more concerned with capital preservation, than with capital growth. And this deflection from capital growth is coming at the very time when the pursuit of that growth is at it's utmost: when reasonable-return expectations are at the low end of the reasonably-attainable spectrum. Unless, of course, you're starting with so much that 6% or 7% returns are within your reasonable-return framework.

      Scenario: $280,000.00 starting balance (IRA's)
      $ 8000.00 yearly contributions
      15% return for 12 years (until age 62)
      8% return thereafter
      $1.73M nestegg @ age 62
      $1.27M projected inflation value (based on last 12 years real inflation rate- per shadowstats.com)
      $85912/yr. after-tax drawdown to age 90 (inflation adjusted, 25% tax rate assumed, and that's probably laughable.)

      No doubt this should be able to provide a comfortable lifestyle, but by no means would I call it a wealthy lifestyle. Merely "insulated."

      If the rate of year-on-year return drops to 10% for those first 12 years, the after-tax drawdown/yr. drops to $52,132. Enough to do some occasional traveling, eat normal food, and that's about it. Not what I had in mind for my retirement years. Ah, but what the hell. That comet will probably hit the "keyhole," and come 2029 it all won't matter, anyway.
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    • Tue Apr 1st 04:07 AM | Rating: 0 0
      Commented on:
      Sellers' 'Hopeful Overvaluation' Dragging Out Housing Bust
      As a R.E. investor for over 25 years, I can assure you that short sales have always been a lender scam. The only short sales lenders would even toy with considering were those properties that had a loan balance close to the market value of the property. Before the bust, lender's kept those properties going through the forclosure process that held any chance of being sold for more than the outstanding balance, and were listed at market value, not loan balance value. Post-bust, there is almost no incentive to short-sell, as the lending dollars that would be freed up by not having the forclosure on the books, are not being lent out anyway, due to so many fewer qualified borrowers, due to the tightened lending standards. Better for lenders to foreclose, collect on the mortgage insurance that was in place (on any loan w/ greater than 80% LTV,) and let the insurer deal with it. Dirty little fact not being talked about in all the subprime/CDO/everythin... debate. Smart lenders had their asses covered from the git-go on the high LTV loans. The write-downs any lender is taking is behind the structured investment products they hold (CDO's, etc.) Not the loss on the loan itself. Here's one for ya: Why hasn't the Fed demanded that all the mortgage insurance $ that get paid to these subprime lenders be applied to the foreclosure principle amount, and let the foreclosed-on owners finance just the remaining balance, if any? Because the lenders who didn't carry enough insuanace on the loans they made (because who cares if we have to foreclose, we'll just sell it for more than the outstanding balance and make mo' money, mo' money, mo' money!) would be in an even deeper hole. So we all get to watch as lots of properties come on the market at distressed prices, and suffer along with those who dug the hole, even though the vast majority of us had nothing to do with it. Gotta save those banks! Who else can keep creating the new money that keeps a debt driven economy afloat, if even for only a few more years.
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    • Mon Mar 10th 06:08 AM | Rating: 0 0
      Commented on:
      5 Reasons Why the U.S. Dollar Will Weaken Further
      Even w/ a projected upturn in the market for the second half of the year, the smart play will continue to be in the commodities/hard assets (GLD, SLV, USO, UNG/GAZ, DBA/DBC as examples.) SIMPLEd points out some things that are finally starting to get some wider-spread attention about the nature of our economy/money/monetary policy.

      The attempt to bolster our economy by lower Fed rates is a losing proposition, in the end. The vast sums of investment by foreign investment sources is doomed to dry up, and be withrawn, as higher inflation (possibly hyper-inflation) and lower yields drive those investors into other markets/currencies that continue to value a strong currency in the long run, versus short term stimulus programs that artificially prop up markets.

      Will be interesting to see if the summer run-up is followed by a precipitous selloff by the institutional investors.

      Subprime is affecting many other foreign economies. But, their ability to offset the debilitating effects is greater than ours due to the overall lower impact, and truly organic growth. As the emerging market's standard of living improves, the developed world's will decline. Economic collapse is low probability, but a continual degrading of the US economy is high probability. Look forward to protracted dead cat bounces for the next few years., and a very hard slide (6000-8000 Dow) eventually.
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    • Mon Feb 25th 03:12 AM | Rating: 0 0
      Commented on:
      The AMBAC Bailout Plan is Really About Banks Saving Their Own AAAsses
      Make that Q4'08, there.
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    • Mon Feb 25th 03:10 AM | Rating: 0 0
      Commented on:
      The AMBAC Bailout Plan is Really About Banks Saving Their Own AAAsses
      Well, here's THEN what- The Fed will start easying rates up in Q4'07 (or Q1'09 at the latest.) The threat of Obamanomics will start to sink in, and a good lick of projected business investment will go in the shitter. All those short interest ETF's that were being held as hedge bets will start to run, and lots of dumping of longs will commence. The option guys will, of course, start putting hard, and drive the downtrend for awhile. Gold will run up even more, (after it's slight to moderate pullback from Q3'08,) and we'll all look back at the good times of up till then (now) with wistfull longing for the good ol' days. Seems familiar, already.
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    • Sat Jan 19th 02:53 AM | Rating: 0 0
      Commented on:
      Don't Buy (Sell) The Bear
      Now throw into the mix the very real possibility of just one of bond insurers going belly up behind the subprime paper. And if the fertilizer hits the ventilator before the gov't figures out that buying these guys up and covering that action @ $.50-.60 on the dollar is way cheaper than letting it happen, even just once, we could see a market slide that wipes out two generations worth of market increases.
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