Dana Cole's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.comuser/149031/comments http://seekingalpha.com/article/69583-pfizer-losing-battle-against-scientific-journals?source=feed#comment-130563 130563 Mon, 24 Mar 2008 09:48:01 -0400 http://seekingalpha.com/article/68707-what-s-in-store-for-bear-on-monday?source=feed#comment-127301 127301 Suppose the "self-serving analysts and sensationalistic journalists" I mentioned were all 100% right. Shouldn't we be thanking them for warning us of our precarious financial situation and putting out the alarm to sell all our stocks?
In a few, individual cases, perhaps yes. In the broader market sense, NO.
Here is why:
Capitalist economies are based on credit, and credit is based on trust. The current "credit crisis" is based on a loss of trust. Loss of trust comes from fear, and fear grabs attention. Those who use fear merely to get attention are thus undermining our economy. This is why the stocks of many companies that are financially sound are also down now.
I guarantee that the instant no one is interested in the "credit crisis" any more, it will cease to exist. ]]> Sun, 16 Mar 2008 18:57:25 -0400 Suppose the "self-serving analysts and sensationalistic journalists" I mentioned were all 100% right. Shouldn't we be thanking them for warning us of our precarious financial situation and putting out the alarm to sell all our stocks?
In a few, individual cases, perhaps yes. In the broader market sense, NO.
Here is why:
Capitalist economies are based on credit, and credit is based on trust. The current "credit crisis" is based on a loss of trust. Loss of trust comes from fear, and fear grabs attention. Those who use fear merely to get attention are thus undermining our economy. This is why the stocks of many companies that are financially sound are also down now.
I guarantee that the instant no one is interested in the "credit crisis" any more, it will cease to exist. ]]> http://seekingalpha.com/article/68707-what-s-in-store-for-bear-on-monday?source=feed#comment-127291 127291 When are we ever going to learn that what serves the best interests of all of us serves the best interests of each one?
]]> Sun, 16 Mar 2008 18:16:20 -0400 When are we ever going to learn that what serves the best interests of all of us serves the best interests of each one?
]]> http://seekingalpha.com/article/68339-6-questions-for-long-term-google-investors?source=feed#comment-126908 126908 Sat, 15 Mar 2008 15:20:03 -0400 http://seekingalpha.com/article/68619-did-the-fed-s-move-prevent-a-stock-market-panic?source=feed#comment-126904 126904 Sat, 15 Mar 2008 15:02:04 -0400 http://seekingalpha.com/article/68418-should-the-us-government-buy-bank-equity?source=feed#comment-125987 125987 Thu, 13 Mar 2008 11:15:47 -0400 http://seekingalpha.com/article/68043-markets-look-set-up-for-an-ugly-fall?source=feed#comment-125320 125320
Thank you for the interesting article, but I have come to the conclusion that in connection with the stock market, which is subject to the influence of billions of people:

THERE IS NO WAY TO PREDICT WITH ANY RELIABLE ACCURACY WHAT WILL HAPPEN TOMORROW BASED ON WHAT HAPPENED IN THE PAST.

If someone can convince me otherwise, please cite the evidence. I am more than willing to be wrong.

All charts do is tell you where the market HAS BEEN and where it is NOW. Trying to predict which way it is headed based on chart patterns is like trying to predict which way a flock of birds is going to fly based on where they flew ten minutes ago.

In late January the 10-20-30 day trend lines of TMA were screaming "Buy!" For a little lesson on making a trade based on trend lines, take a look at that chart now.

(My sympathies to those who bought TMA. I have made the same mistake more than once, which is why I am posting this comment.)

In the same way, in late January the 10-20-30 day trend lines on AA spelled doom for the stock. To see what actually happened, check out the chart now.

Anticipating breaks in trend lines - even long-term trend lines - is dangerous because the time when a break appears imminent (or, in other words, as charts looked TODAY) is exactly the time when stocks have become cheapest relative to where they have been. The longer the trend line, the cheaper they are.

Does that mean that charts should not be used? Of course not! They are the only really effective visual ways we have of determining what has happened and where we are now. And to the extent that up and down patterns DO tend to repeat themselves over time, they are highly useful in GUESSING were things are going. It is still just a guess, though.

We must always remember that no stock ever obeyed the dictates of a chart. Just because I draw a line under a price does not mean that that price will not be violated - NOR does it mean that it is at risk of being violated. It is only a line on a chart and that is all.

I'm only trying to save someone some time and a little money here. In the past I would have been grateful if someone had done it for me.]]> Tue, 11 Mar 2008 17:35:00 -0400
Thank you for the interesting article, but I have come to the conclusion that in connection with the stock market, which is subject to the influence of billions of people:

THERE IS NO WAY TO PREDICT WITH ANY RELIABLE ACCURACY WHAT WILL HAPPEN TOMORROW BASED ON WHAT HAPPENED IN THE PAST.

If someone can convince me otherwise, please cite the evidence. I am more than willing to be wrong.

All charts do is tell you where the market HAS BEEN and where it is NOW. Trying to predict which way it is headed based on chart patterns is like trying to predict which way a flock of birds is going to fly based on where they flew ten minutes ago.

In late January the 10-20-30 day trend lines of TMA were screaming "Buy!" For a little lesson on making a trade based on trend lines, take a look at that chart now.

(My sympathies to those who bought TMA. I have made the same mistake more than once, which is why I am posting this comment.)

In the same way, in late January the 10-20-30 day trend lines on AA spelled doom for the stock. To see what actually happened, check out the chart now.

Anticipating breaks in trend lines - even long-term trend lines - is dangerous because the time when a break appears imminent (or, in other words, as charts looked TODAY) is exactly the time when stocks have become cheapest relative to where they have been. The longer the trend line, the cheaper they are.

Does that mean that charts should not be used? Of course not! They are the only really effective visual ways we have of determining what has happened and where we are now. And to the extent that up and down patterns DO tend to repeat themselves over time, they are highly useful in GUESSING were things are going. It is still just a guess, though.

We must always remember that no stock ever obeyed the dictates of a chart. Just because I draw a line under a price does not mean that that price will not be violated - NOR does it mean that it is at risk of being violated. It is only a line on a chart and that is all.

I'm only trying to save someone some time and a little money here. In the past I would have been grateful if someone had done it for me.]]> http://seekingalpha.com/article/67917-murdoch-on-the-economy-and-yahoo-bid?source=feed#comment-124824 124824 Mon, 10 Mar 2008 16:48:10 -0400 http://seekingalpha.com/article/67732-another-rotten-jobs-report-from-february?source=feed#comment-124316 124316
It's going to be all right.]]> Sun, 09 Mar 2008 14:44:44 -0400
It's going to be all right.]]> http://seekingalpha.com/article/67733-8-market-trends-for-the-next-few-years?source=feed#comment-124312 124312
It's going to be all right.]]> Sun, 09 Mar 2008 14:41:20 -0400
It's going to be all right.]]> http://seekingalpha.com/article/67304-is-pfizer-ready-for-generic-lipitor?source=feed#comment-123244 123244
Here's the correction: $22 is not 60% down from $38; it's ONLY 42% down. (Of course, it IS 56% down from its 8-year high of 49.)

So maybe there is still more room going down. We'll find out, won't we.]]> Thu, 06 Mar 2008 19:15:47 -0500
Here's the correction: $22 is not 60% down from $38; it's ONLY 42% down. (Of course, it IS 56% down from its 8-year high of 49.)

So maybe there is still more room going down. We'll find out, won't we.]]> http://seekingalpha.com/article/67304-is-pfizer-ready-for-generic-lipitor?source=feed#comment-122583 122583
Now, at $22 the stock is down almost 60% from its 4-year high of $38. Since it is highly likely that overseas sales, new drugs and biotech acquisitions will replace at least half of that $12B long before 2010, isn't the stock rather undervalued at $22? Just asking.

Incidentally, I wish you had had your interview with Kindler, as I find your columns to be very informative and easy to read. However, it seems to me that the reason they didn't get back to you was because they were trying to decide on who would do the interview, not for personal reasons. At least I hope that's the case. ]]> Wed, 05 Mar 2008 16:29:32 -0500
Now, at $22 the stock is down almost 60% from its 4-year high of $38. Since it is highly likely that overseas sales, new drugs and biotech acquisitions will replace at least half of that $12B long before 2010, isn't the stock rather undervalued at $22? Just asking.

Incidentally, I wish you had had your interview with Kindler, as I find your columns to be very informative and easy to read. However, it seems to me that the reason they didn't get back to you was because they were trying to decide on who would do the interview, not for personal reasons. At least I hope that's the case. ]]> http://seekingalpha.com/article/67144-sell-side-still-sees-s-p-500-up-20-by-year-s-end?source=feed#comment-122090 122090 To proceed upwards, we need a really good flush out on the downside. We are not getting it because diehard contrarian buyers are weakly holding prices up. If all today's sellers held back for a week or two, these would happen:

Buyers would be picking up stocks at truly "bargain" prices.

The huge crowd of people out there waiting for a "test of the January lows" would have already had it.

Levels of pessimism would match those that characterize bear market bottoms.

As it is, there's not much room for rallies, since so many folks are scared and trying to get out.

]]> Tue, 04 Mar 2008 15:38:58 -0500 To proceed upwards, we need a really good flush out on the downside. We are not getting it because diehard contrarian buyers are weakly holding prices up. If all today's sellers held back for a week or two, these would happen:

Buyers would be picking up stocks at truly "bargain" prices.

The huge crowd of people out there waiting for a "test of the January lows" would have already had it.

Levels of pessimism would match those that characterize bear market bottoms.

As it is, there's not much room for rallies, since so many folks are scared and trying to get out.

]]> http://seekingalpha.com/article/67137-no-bear-yet-average-stock-already-down-30?source=feed#comment-122078 122078 Tue, 04 Mar 2008 15:08:50 -0500 http://seekingalpha.com/article/66275-mbia-gets-moody-s-top-rating-pfizer-downgraded-is-this-for-real?source=feed#comment-119830 119830 P.S. Couldn't find this article on SA's front page. Why not? ]]> Wed, 27 Feb 2008 14:32:14 -0500 P.S. Couldn't find this article on SA's front page. Why not? ]]> http://seekingalpha.com/article/66275-mbia-gets-moody-s-top-rating-pfizer-downgraded-is-this-for-real?source=feed#comment-119762 119762 Wed, 27 Feb 2008 12:12:04 -0500 http://seekingalpha.com/article/65788-a-winning-trade-is-a-tough-trade?source=feed#comment-118819 118819 Mon, 25 Feb 2008 13:28:55 -0500 http://seekingalpha.com/article/65860-why-i-m-not-worried-about-the-market?source=feed#comment-118814 118814 Obviously, the time to borrow money was back in 2003. The time to buy those who loaned it is either now or very soon. ]]> Mon, 25 Feb 2008 13:22:36 -0500 Obviously, the time to borrow money was back in 2003. The time to buy those who loaned it is either now or very soon. ]]> http://seekingalpha.com/article/65780-friday-s-turnaround-raid-on-the-shorts?source=feed#comment-118117 118117 There seems to be a lot of people around like Bill Ackman, Meredith Whitney, Prasant Bhatia and others who are determined to make a name for themselves by talking the market down. In particular, Ackman comes off like he's not going to be happy unless Ambac goes out of business or he's in charge of the company himself. You seem to be among that crowd.
If all of you are right, then the short side of the market is definitely where we want to be, and we should be thanking you for handing out the advice.
On the other hand, if there's one thing we've learned from trading for a while, it's that NO ONE is right in the markets all the time. You may be right for a while, even for a long time, but then along comes the day when you are wrong. And vice versa.
Even though the short side of the market has been paying off for quite a while, no matter where the market is, there's always going to be someone who's saying we're headed for a steep fall and there's always going to be someone who's saying we'll be at all-time highs before the year is out. That is not the question.
The question is:

Which is the path of least resistance?

From the tape, I see a lot of folks who are either very scared or are determined to push the market down - all on RUMORS. If they go on shorting and being scared and no one sees any value in lots of companies that are historically underpriced and still functioning without problems, then we've got another 20% down move coming very soon.
However, I also see a lot of guys waiting around with money burning a hole in their pockets, looking for any excuse to buy. If in 2008 the great credit scare of 2007 turns out to be not quite so scary after all, the latter are definitely going to take over for a while. All that will require is that someone with cash gets a handle on what all the CDO's out there are actually worth and begins to snap them up. After all, the Real Estate market goes up and down, but it doesn't go down forever until we don't need land and houses anymore. Do you see that happening sometime soon?
]]> Sat, 23 Feb 2008 18:36:36 -0500 There seems to be a lot of people around like Bill Ackman, Meredith Whitney, Prasant Bhatia and others who are determined to make a name for themselves by talking the market down. In particular, Ackman comes off like he's not going to be happy unless Ambac goes out of business or he's in charge of the company himself. You seem to be among that crowd.
If all of you are right, then the short side of the market is definitely where we want to be, and we should be thanking you for handing out the advice.
On the other hand, if there's one thing we've learned from trading for a while, it's that NO ONE is right in the markets all the time. You may be right for a while, even for a long time, but then along comes the day when you are wrong. And vice versa.
Even though the short side of the market has been paying off for quite a while, no matter where the market is, there's always going to be someone who's saying we're headed for a steep fall and there's always going to be someone who's saying we'll be at all-time highs before the year is out. That is not the question.
The question is:

Which is the path of least resistance?

From the tape, I see a lot of folks who are either very scared or are determined to push the market down - all on RUMORS. If they go on shorting and being scared and no one sees any value in lots of companies that are historically underpriced and still functioning without problems, then we've got another 20% down move coming very soon.
However, I also see a lot of guys waiting around with money burning a hole in their pockets, looking for any excuse to buy. If in 2008 the great credit scare of 2007 turns out to be not quite so scary after all, the latter are definitely going to take over for a while. All that will require is that someone with cash gets a handle on what all the CDO's out there are actually worth and begins to snap them up. After all, the Real Estate market goes up and down, but it doesn't go down forever until we don't need land and houses anymore. Do you see that happening sometime soon?
]]> http://seekingalpha.com/article/65317-still-too-early-to-celebrate-dow-and-s-p-500-rise?source=feed#comment-117528 117528 I don't know, and I'm not sufficiently interested to do the research. Even if they were recorded, however, with approximately 25 steep down days (by range) since the all-time high in the S&P, that kind of short trading would have generated a lot of cash by now.
On the other hand, with each 5% move down in the indexes shorting becomes more risky. Why? Because the "smart" (read "big") money is going to jump in at the best prices, which will bring about the mother of all short squeezes.
Many good stocks are now approaching their 10-year lows and are attractive for their dividends alone, some of which are offering higher yields than almost any other investment. Smart institutional traders are not going to miss the opportunity to get into high yielding stocks at low prices, are they? They've got to put their money somewhere. What else are they going to do with it?
Gold is great as a hedge, but where are the dividends? Commodities have got to go up or you're not making money.
I hope that you're wrong in your estimation of where we're headed, although the prospect of buying stocks at even lower prices is certainly appealing.
Thanks for listening.


]]> Wed, 20 Feb 2008 23:53:10 -0500 I don't know, and I'm not sufficiently interested to do the research. Even if they were recorded, however, with approximately 25 steep down days (by range) since the all-time high in the S&P, that kind of short trading would have generated a lot of cash by now.
On the other hand, with each 5% move down in the indexes shorting becomes more risky. Why? Because the "smart" (read "big") money is going to jump in at the best prices, which will bring about the mother of all short squeezes.
Many good stocks are now approaching their 10-year lows and are attractive for their dividends alone, some of which are offering higher yields than almost any other investment. Smart institutional traders are not going to miss the opportunity to get into high yielding stocks at low prices, are they? They've got to put their money somewhere. What else are they going to do with it?
Gold is great as a hedge, but where are the dividends? Commodities have got to go up or you're not making money.
I hope that you're wrong in your estimation of where we're headed, although the prospect of buying stocks at even lower prices is certainly appealing.
Thanks for listening.


]]> http://seekingalpha.com/article/64653-is-an-accommodating-fed-really-bullish-for-stocks?source=feed#comment-116470 116470 Since they are lowering rates much more aggressively now than they did back then, the chance for an even bigger rally - or at least a near-term sideways range - is there.]]> Fri, 15 Feb 2008 10:44:49 -0500 Since they are lowering rates much more aggressively now than they did back then, the chance for an even bigger rally - or at least a near-term sideways range - is there.]]> http://seekingalpha.com/article/64662-the-writing-is-on-the-wall-banks-today-the-rest-tomorrow?source=feed#comment-116366 116366 Thu, 14 Feb 2008 17:42:49 -0500 http://seekingalpha.com/article/64662-the-writing-is-on-the-wall-banks-today-the-rest-tomorrow?source=feed#comment-116341 116341 Yet, on the logic that the time to buy is when all the news is bad, there is a good chance that most of the extended credit contraction described here has already been factored into today’s prices.
Here’s why I say this:
As of today, February 14, 2008, the 30 Dow stocks are distributed as follows:

11 are nearer their 10-year lows
6 are somewhere in the middle of their 10-year range
13 are nearer their 10-year-highs

In other words, 17 of the Dow 30 are already in the middle or nearer the bottom of their 10-year ranges, including where they were during the bear market of ’01-‘03. Not to be a “glass is half full” kind of person but it seems to me that this is not the kind of distribution we would see if another 20% downwards move were coming in the Dow.
We have to ask ourselves: Do the CDO’s out there have any value at all, and if they do, what is it?
We’re not going to stop needing houses to live in, banks and investments in which to place our money and land on which to grow food any time soon. Aren’t the vast majority of all CDO’s based on these?
I couldn’t agree more that “cash is king.” But at some point someone with cash is going to see clearly what the real value of all these CDO’s is and is going to start buying with both hands. In fact, we are already seeing the first tentative signs that that is occurring.
]]> Thu, 14 Feb 2008 15:16:17 -0500 Yet, on the logic that the time to buy is when all the news is bad, there is a good chance that most of the extended credit contraction described here has already been factored into today’s prices.
Here’s why I say this:
As of today, February 14, 2008, the 30 Dow stocks are distributed as follows:

11 are nearer their 10-year lows
6 are somewhere in the middle of their 10-year range
13 are nearer their 10-year-highs

In other words, 17 of the Dow 30 are already in the middle or nearer the bottom of their 10-year ranges, including where they were during the bear market of ’01-‘03. Not to be a “glass is half full” kind of person but it seems to me that this is not the kind of distribution we would see if another 20% downwards move were coming in the Dow.
We have to ask ourselves: Do the CDO’s out there have any value at all, and if they do, what is it?
We’re not going to stop needing houses to live in, banks and investments in which to place our money and land on which to grow food any time soon. Aren’t the vast majority of all CDO’s based on these?
I couldn’t agree more that “cash is king.” But at some point someone with cash is going to see clearly what the real value of all these CDO’s is and is going to start buying with both hands. In fact, we are already seeing the first tentative signs that that is occurring.
]]> http://seekingalpha.com/article/64160-strange-but-true-stock-prices-have-a-memory?source=feed#comment-116195 116195 Wed, 13 Feb 2008 21:34:53 -0500 http://seekingalpha.com/article/64160-strange-but-true-stock-prices-have-a-memory?source=feed#comment-116130 116130 I would really like to understand this chart, as I have been doing quite a bit of research on what constitutes a "trend" and whether or not there has ever been any statistical relationship between daily price changes and weekly or longer term trends.
]]> Wed, 13 Feb 2008 14:55:31 -0500 I would really like to understand this chart, as I have been doing quite a bit of research on what constitutes a "trend" and whether or not there has ever been any statistical relationship between daily price changes and weekly or longer term trends.
]]> http://seekingalpha.com/article/64160-strange-but-true-stock-prices-have-a-memory?source=feed#comment-116094 116094 Major daily moves tend to establish trends but smaller daily moves do not? Yes, seems true.
Stock prices "remember" what happened yesterday, but "can't remember" what happened the day before that? Yes, pretty much coincides with general trader mentality as I have experienced it.
Great work.]]> Wed, 13 Feb 2008 11:50:51 -0500 Major daily moves tend to establish trends but smaller daily moves do not? Yes, seems true.
Stock prices "remember" what happened yesterday, but "can't remember" what happened the day before that? Yes, pretty much coincides with general trader mentality as I have experienced it.
Great work.]]>