MSmailbox

Turning Japanese: The Audacity of Reality (Part 3 of 3)

You are a very straight-shooter, but I wonder whether the "shock and awe" of revealing our true state, may be a matter of National Security (TS).

On point #5, regading GM and the other North American Auto Producers... GM can survive, but it must be transformed. This is a rare opportunity for the rebirth of the entire North American Auto Manufacturers... If that group can cooperate with each other and with the US government, then GM can play a part in a new structure, which like Japan, coordinates and maximizes efficiencies, including financial accomodations. Envision the forward-leaning Tesla being mass-produced (at much lower costs), in GM factories, using the experience and resources of that automotive giant. Then, envison these electric cars being exported, worldwide. Nuf, said.

What's Wrong with TARP

I like your plan... At least all the "junk" would be gathered together into one place, isolated from the nation's primary banking system. Good banks should be nurtured, just as bad ones need to disseminate over time. Your strategy contains the key elements of the restructuring and would appear gradual enough to avoid any shock to the primary system. It would appear that "Jubilee" has come for the banks (occcurs once every 50 years)!

I am heavily invested in MI, right now... I would say that it's going to be a long wait, but with the volatility we've seen, anything is possible (just so long as the presses keep printing). Honestly, I can imagine situations where MI could go either way, but I am heavily biased towards the positive, in this case.

It looks as if our economy is going through DETOX... Recovery and new life (business activity) await. It may take a while and it may hurt, but the outcome will be something that we can be proud of in fifty years from now.

Buffett's Latest Headache: U.S. Bancorp

Buffett makes mistakes, like all of us... In 2001, Buffet had a 5-year outlook as grim as the last two years have been + the next three! He said don't invest in stocks for the next 5 years (which turned out splendid)... Lawrence Ruekheiser was encouraging his TV audience to start dollar-cost averaging into the coming rise of equities. Obviously, Ruekheiser was right.

One thing about Warran Buffet though, it's a lot easier to recall and note his mistakes, than it is to count his victories, which would take many pages.

'Bad Bank' - Bad Idea

It looks to me like the banks need to (effectively) declare bankruptcy. An open-book analysis of how each bank has managed their business, over the past 10 years, would be helpful in deciding their fates, in a consolodation. Life-support in the form of tax-money, or palliative care, also tax money, to help them (the bad banks) to shutdown and smoothly (without loss) tranfer their customers to performing banks. Guaranteed solvency, but each performing bank would compete for profit, restore dividends and seek indpendance from subsidy. Non-performing banks would not exist. Bottom-line, the taxpayer pays for a revamped and vital banking system. It does so, by absorbing toxic debt, providing necessary capital for liquidity, neutralizing bad-banks, reward good banks with customers from extinct banks. Regulate these good banks, so that they stay good banks. A smaller, better herd of banks, might help in the long-run.

Financial Sector: More Dividend Cuts

I am an MI shareholder and though, I regret missing a good dividend, I agree with this action (lowering dividends to .01). To even allow the perception, that "bailout" money is being passed-thru banks in the form of dividends to their shareholders, is unthinkable. This is a clean field, now, and good banks should prosper upon their merits. Play ball!

GM Proves There Is an Alternative to Bailouts

I have not seen the need to "short" any company, since 1988, when I shorted AMD (and made money). I intend to put in a "short" order on GM common, this morning. It's all that I can (legally) do, to help end this misery. Our country is what's at stake! Do you want a country which is driven by a bunch of (un-elected) scoundrals? General Motors IS history, but we can only dwell in the past for so long, before it destroys our future. GM deserves a good funeral, not extraordinary life-support... Heck, I don't even want that kind of support, for my own mortal body! When the time comes, it's better to go in peace. That time has come and we should all pay our respects, but NOT our taxes. May GM Rest in Peace and never be forgotton, neither for it's automotive innovations, nor for it's financial atrocities.

Inflation Is Bad for Stocks...

One year, there was a terrific inflation in stock prices. I paid a huge amount of capital-gains tax, that year!

Deflation and over-inflation, are both bad.

Proper inflation, will always get you where you are going, though.

This is right out of the GM Owner's Manual.

Should GM Be Saved?

GM must "repent," before it can be "saved."

GM Could Benefit from Bankruptcy

I don't think that it's going to be a CARMAGEDDON... We've got plenty of time to allow the dealers to sell-off their remaining inventory, since car sales aren't very brisk right now, anyway. I've seen what happens when they keep cranking cars out into the yard... Once it fills up, they have to rent adjascent corn fields to store thousands upon thousands of cars and then, we usually get a hail storm and then, it's a total mess for everyone, including those who insure these jobs. Let's just take our time and work out a long-term solution. Obama is right on target! Unless we see major CHANGE at the Big-three, then no more DOLLARS.

GM Must Die

I agree. We need to protect the industry, but not GM. Otherwise, we'll be facing 'Carmageddon.'

Fed Watch: More Easing Expected

The dollar offers relative safety. How else could it be firming, in the face of massive rate cuts. Foreign investors have been reading the bumper stickers, which read, "BUY AMERICAN." I would add to this, North, Central and South American, because there are some great companies to our North and to our South.

Here's a thought! The dollar is rising, because the prices of US equities have fallen, over the past few months. The stock market is always the leading index, so that's why we are just beginning to see a bull market in the USD. The US dollar must rise inversly, as US equities fall. You own company xyz and it's fundamentals haven't changed over the past 14 months, but it's lost 67% of it's value, in USD. Obviously, since the company hasn't changed, the USD must rise in order to preserve "capital mass." Looking ahead, the stock market must rally and rally big, or we are faced with a USD that could double in value, very soon. :-)

Home Price Reality Check

"If you've been in a place for years with no plans to move, haven't had the need to "tap" your home equity only to find less of it there, and don't see the need to keep track of what nearby houses sell for, you're probably not really qualified to offer an opinion on this anyway."

Qualified, or not... This is exactly my situation. The best reason that I have for determining the value of my home, is so that I can have it reassessed, in order to reduce personal property taxes and insurance premiums. There is always a reason to remain aware of valuations.

Potash Corp: Liquidity Trouble Ahead?

Last week, it was reported that GM is increasing the number of E-85 vehicles in the mix. I realize that GM isn't producing as many cars as they were, but they appear to know something about the future of ethanol as a fuel.

I agree with Bob'29... It was the unwinding of hedge fund positons, which caused this extraordinay drop. What else could account for that big of a drop in Potash and others, as well. This is a "synthetic" conditon. An abberation, just as the entire market is skewed, at the moment.

If third quater earnings for POT are good, and I expect them to be very good, they will contrast other fine companies, which are reporting poor earnings. I don't think that the fundamental picture has changed that much. Some big players dumped. If the market recovers from it's "synthetic" depression, I believe that Potash will rocket! Won't the same people who dumped, be back in force, when earnings come out? What about global investors who want to "BUY AMERICAN," just like the bumper sticker says? Won't they be back looking for companies that are sound, but beaten-up by "synthethic" short-term trades. The mood of the market, government(s) actions to spike a reversal, flight to quality, renewal of ethanol as a fuel (I was surprised, by this), solid earnings, recession-resistant product, Chinese demand increasing... But in a market like this, anything is possible.

Expect More Misery in Earnings

What about a stock like POT, where there was a bubble and it popped? Fundamentals seem sturdy enough. I'm not contesting your assessment of the general market, but what of the exceptions? Will this type of market value a company with strong earnings, good management and a host of other positives?

Must Settle - Cramer's Stop Trading! (10/20/08)

After the drubbing that Cramer has taken, some of it deserved, he's got guts to continue on and try to prove that's he's more than just a "pretty face." If he survives, he'll come back stronger and better than version 1.0 Cramer was. I look for him to eliminate some of the "bells and whistles," but I don't want him to get carried away and turn sour. We all make mistakes, but some people learn from their mistakes, hang in there against great persecution and come back a winner! At this point, I feel that Cramer has been beaten up enough, to take a small position (LONG), in him. He was way overbought, but I see him as fairly valued at this point. I don't believe that he's going to fold, his bubble has been deflated and downside risk is minimal. If he can put a frame around this recovery, explain what's going on and not make too many outlandish predictions, I predict that Cramer will bounce back, in tandem with the market. If the market should completely collapse, then we won't need Cramer, anyway. Low risk, good value and the potential for a recovery. I don't believe that he'll be bought out, but that's something which he wouldn't mention, even if he were in talks with another network. Now is the time to buy Cramer, if you believe in him! If you wait for him to start climbing again, youll proabably miss a good part of the upside on this man. Good Luck, Cramer... Don't disappoint us, again.