Oleg M

The Next Shoe to Drop in Banking: An Options Strategy

Hello,

On the close of Aug 24th, 2009, XLF SEP $12 puts I see quoted at 0.05 - yeah for unlimited risk for a nickel. Skip selling put and get better buying power req.

I find it temping to sell credit spreads on XLF, but I would expect JPM,STT,BAC,STI,BBT,GS... to provide the most of the down move in XLF. In my opinion it would be better to construct credit spreads on the above stocks and do calendars on XLF for +theta +vega.

Buy XLF Oct/Sep $14 Calendar for a quarter. Breakeven 14.82, 13.26

Let's say if I'm somewhat neutral on C, I could sell straddles on it. $5 OCT straddle at the close is quoted at 1.20 with BE 3.8/6.3.

www.etfinvestmentoutlo... can be useful.

Fundamentals Don't Support Oil at $55-60 a Barrel

Not surprising at all. Banks/brokers had some cash freed up from sale of treasuries, so is it really unreasonable to suspect that some cash went to oil futures?

Is Bank of America Poised for a Major Move Up?

Yes! if you move backwards in time.

Tactical Asset Allocation, Part II

Great commentary, however, I don't mean to piss on your reasoning , but year 3 year of data is NOTHING. LTCM went out of business because they looked over only 10 years of data.

ETF Insights: The New Hard Assets Producers ETF

If oil keeps falling - perfect short!

The Housing Bill and the House Hank Helped Build

You sir, are a moron, with capital M. Where does the notion that someone should ease the pain in the housing market comes from? What has the housing market done to deserve such a special treatment?

This housing 'market' should get destroyed outright and houses should be priced what people are willing to pay for them.

Let's quickly recap for the uneducated:
-Appraisals were BS
-Many people's stated income was BS
--in fact, banks were pushing people to state higher income.
-Bond insurers never bothered to do any due dilligence
-Credit agencies gave bogus AAA rating to bonds on mortgage pools where a person can choose to add interest to their principal.
--Gave BBB rating to bonds of subprime mortgage pools that were clearly toxic waste.
On and on. Arguably, 2/3 of house prices is BS on BS on BS on BS. House prices should return to their fair value. People who are earning $8 per hour will not be able to afford $700K house. There's a nice tool called calculator that can help you navigate through the trouble. Use it!

If it means that C,BAC,LEH are going belly up - so be it. They are not that important. Let's review the foundation of their core businesses. It all boils down to using up future earning power today. Transferring wealth from the future to today. Except, about a decade ago they started messing up - instead of transferring future wealth into today's investments, they started transferring future wealth into today's consumption. I'm not against banks, or ibanks - it can be a great business, but the type of crap that's been pulled off recently is borderline criminal to being with. And the government is asking taxpayers to prop up - whatever that means - shitty mortgage pools because we cannot let housing industry fail? BS!

Is It Time to Buy Ambac?

The fact that he has exited his short positions does not necessary indicate he's no longer bearish on ABK, MBI. I think it is very likely that he has identified better opportunities, and hence reallocated his capital elsewhere.

Regardless what you think of Mr. Ackman, it is foolish to judge companies solemnly based on opinion of one person. You may not know all his motives.

Where was that article that SP thinks that HELOCs rated below AA will have 0 recovery rate in super senior tranches (IIRC)

Is Berkshire Hathaway Now a Bargain?

No, BRKs has been a good short for a while and will continue to be so.

Contrarian Pick: Flash Memory Vendors

This article is clearly written by an apple fan boy, however, his last point is the one that has the most weight in my opinion. ultra portable laptops are being quiet popular and they started using flash drives. take a look at Asus EEE, they are flying off the shelves. However, EEE is not practical for everyone due to small storage capacity.

Once all major laptop manufacturers start announcing ultra portables with at least 60GB of flash storage, pay close attention.

The only thing that I find depressing about this industry is constantly thinning margins. As the article pointed out, there will likely to be mergers. However, I think many of them will not work out as newer and newer fab processes would need to be used to created higher density chips. Let's say company A buys company B that has older process fabs lying around. They might be better off just building a new fab rather than relying on the older fabs. Mergers with lagers would work out if the buyer can find enough volume to keep the older process plants busy.

On the Eve of Recession, Some Historical Perspective

Quick remark.
Before the great depression, NY Fed was arguing for easing on lending, while Washington Fed was saving for some big bad and ugly event ahead, Washington won unfortunately.

Is the GPS Golden Age Already Over?

Not everyone wants to buy new cell phones.
Screens on cell phones tend to be smaller to accommodate people's desires to get smaller and smaller communication devices. That trend doesn't exactly scale well for GPS and navigation interfaces, having a large grasp of the area is better than playing with puzzles pieces-sized mini-maps. But to some extent, I agree with you that new purchasers of cell phones will probably have a decrease in tendency to get a gps device, I'd call them every-so-often users. Many stocks have taken a similar pattern as well so it is hard to say right now, wait for verification?