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  • A Correction Or Market Bottom? [View article]
    D. Olteanu,

    Monetarist unions are usually destined for failure.

    Unless the eurozone leaders also want to become a fiscal union then the monetarist union will also fail. How long will Finland or Italy permit Germany to receive the windfall of EZ membership at their expense?

    High unemployment in Ireland, Portugal and Spain is not sustainable if they are to remain republics. The right and left will be electorally successful and be more representative in their legislatures. Europe's penchant is for fascism. The French fascists for example, appear to have more sway with the people than the communists. The same is accurate for many other Eurozone nations and EU countries.

    Eurozone corporate balance sheet strength is relative and is largely due to Mario Drahgi's QE. He has applied a bandaid. Unless EZ debt for households and companies can be restructured by write downs the EZ will remain in a slow growth environment.

    I agree that there are pockets of productivity improvement in the EZ. IMO many of the improvements are due to layoffs and unemployemt, however.

    Aug 24, 2015. 02:55 PM | Likes Like |Link to Comment
  • A Correction Or Market Bottom? [View article]

    Stocks and where are to buy IMO is always subjective. I also have a rule to never say never or always in a written sentence but there are also exceptions to every rule.

    With that said, I'll inform you what I did on Thursday and Friday last week.

    I bought MCK, HAR, KMI and F. They are all cheaper today.

    Today, I bought DIS.

    Aug 24, 2015. 12:03 PM | 1 Like Like |Link to Comment
  • Reuters: U.S. set to approve landmark crude oil export swaps with Mexico [View news story]

    Thx for responding.
    Aug 22, 2015. 06:24 PM | Likes Like |Link to Comment
  • A Correction Or Market Bottom? [View article]
    The US economy IMO is still improving. Auto production remains robust. Housing starts are on the upswing. New buyers are entering the market. Mortgage lenders have loosened credit by reducing FICA scores to the 680 range from 740 for jumbo loans. Down payments have also been lowered from 20% to 15%. Home Depot reported a great quarter. The upshot is that when housing starts are on the rise the ancillary industries such as appliances, carpeting, paint, furniture, lawn and garden, etc., are also beneficiaries of the housing recovery. At the same time job prospects in those aforementioned industries will improve and the income accelerator effect will transfer into more consumable and/or investment purchases. Think 1980s when the boomers came of age and started leaving the nest albeit not as robust due to relative wage stagnation but improving median income stats.

    Europe has settled their Greece problem. The monetarists won this round so the contagion default by Greece and the threat of those in the eurozone leaving such as Spain, Ireland or Italy is off the table at this time. Their economy is marginally improving. Yes, unemployment is still a problem but all indicators show that Europe is recovering with limited to moderate growth. It is much better off than it was last year.

    Japan is stable. It takes one step forward and one step forward then two steps back and two more sideways. Their unemployment is low. Do they require reform? Yes. Will they do it? No, because their demographics and homogenous culture prevent it.

    So that leaves China as a possible meltdown leading to slower worldwide economic growth or worst case a possible Great Recession II or Great Depression II.

    With that said, I have to ask since when is $41 dollar oil bad for an oil importer. Since when is commodity price deterioation bad for a commodity importer? Hint: The US is also a net importer on many commodities as is Europe. Several pundits, economic gurus, hedge fund managers are crying a river because of China's manufacturing PMI. Has anyone noticed China's service PMI lately?

    Isn't this what the advanced countries have been asking China to do, namely transition from an assembly/manufacturing based economy that relies heavily on internal investment to a more service sector, consumer buying economy, relaxing capital controls, etc.?

    I would argue that China is succeeding at this transition albeit with the consequential restructuring in their former high growth industries.

    What worries me is China's state owned and independent corporate as well as local government debt and their shadow banking industry. The state owned banks will be OK. Doesn't the Poliburo have the power to print money for the benefit of the country and the Party to stay in power instead of what the West does, namely print money ex-nihlo for the benefit of banksters?

    With all this said, Chinese defaults are coming. If not this year because the government will mask the problem through accounting gimmicks then definitely in the next couple of years. You can only hide the problem so long.

    In keeping with this article's topic, IMO the market will bounce back. The S&P may go as low as 1936 or an approximate 10% correction from this year's high. I arrived at 1936 from Carolyn Broden's technical analysis. If it goes lower than 1936 then buckle up for another 10% correction per most technical analysts.

    This year's market is not for the faint of heart. It is also an occasion to make large gains or lose lots of money.

    I dipped my toe into buying selected stocks on Thursday and Friday. I will also buy if price points are hit in other stocks that I monitor and/or currently hold.

    Aug 22, 2015. 04:39 PM | 4 Likes Like |Link to Comment
  • Reuters: U.S. set to approve landmark crude oil export swaps with Mexico [View news story]

    It is my understanding that some Canadians residing in western Canada and their native Indian populations have thwarted pipeline expansion. Do you have any recent news or reports that discuss the Canadian central government authorizing the actual building of pipelines through the Canadian West in the past 3 - 6 months?

    It is also my understanding that KMI is on hold buidling their pipeline on the Canadian west coast.
    Aug 22, 2015. 01:35 PM | Likes Like |Link to Comment
  • BP manipulated Texas natural gas market in 2008, judge says [View news story]
    Are you defending BP and BAC or is this cynicism?
    Aug 17, 2015. 03:07 PM | Likes Like |Link to Comment
  • Reuters: U.S. set to approve landmark crude oil export swaps with Mexico [View news story]

    "Even now they're still flaring thirty percent of 'worthless product'."

    North Dakota gas producers are flaring their nat gas because they don't have pipelines to ship it.
    Aug 17, 2015. 01:52 PM | 2 Likes Like |Link to Comment
  • Another disastrous day for oil stocks - is it capitulation time? [View news story]
    Lille oil are filing daily or being bought out .
    Aug 14, 2015. 01:30 AM | 1 Like Like |Link to Comment
  • Strong comp sales at Jack in the Box [View news story]
    Profit taking.
    Aug 6, 2015. 10:34 AM | Likes Like |Link to Comment
  • Alcoa raises criticism of CFTC over LME warehouse reform [View news story]

    For AA and other aluminum producers the LME system was once controlled by JPM and GS because they owned the warehouses. The banksters delayed inbound and outbound deliveries from vendors and customers causing prices to rise.

    JPM and GS under pressure have since sold their holdings in LME warehouses and supply and demand from a logistical standpoint re: the warehouses are relatively back in balance.

    AA is complaining that the US shouldn'd be interfering with LME warehouse regulation because it is Europe based.

    AA IMO is worried that the CFTC might want more expedited logistics, thus increasing supply in a shrinking demand (China) world.
    Aug 5, 2015. 09:26 PM | 4 Likes Like |Link to Comment
  • The Power Patch Is Prickly [View article]

    As a long time and former reader on The welcome to SA. I've always enjoyed your articles on the They were informative and stimulative.

    This article is in keeping with your sometimes excellent and always very good articles.

    Fellow SA readers, if you are interested in following someone that knows about the regulatory, wholesale, commerical utility markets, Glenn is the guy to follow.

    Thx again for the article.
    Aug 4, 2015. 07:13 PM | 3 Likes Like |Link to Comment
  • Chesapeake Energy playing defense, Credit Suisse says in downgrade [View news story]
    Only problem is keeping up to date with his thinking and buying or selling of a specific company."

    IMHO that is not the only problem. Mr. Icahn sold his stake in NFLX. If you had followed his lead you would've missed more considerable upside. I don't know how you can tell when Mr. Ichan also sells before the media or "those" in the know do. The 13F filings are filed so everyone receives them at the same time.

    Mr. Icahn is a trader IMO. If you are a trader too, then good luck. Trading in out of postions is not my cup of tea. It is simialr to trying to time the market.

    I tend to hold my investments for a longer duration then just a year or two. This is not to say that I'm "married" to them either but to reflect my strategy.
    Aug 4, 2015. 06:41 PM | Likes Like |Link to Comment
  • Chesapeake Energy: An Open Letter To Carl Icahn [View article]
    I didn't buy CHK today in the hope of Icahn buying more stock. Per the last 13F he had raised his stakes in CHK in Q1 to all an all time high. To rely on Icahn who is already underwater to buy more and the basis for an investment is not sound judgement IMO. With that said, Todd has laid out a sound hypothesis for the stock's valuation. I too do not think that the stock is worth what Todd thinks it is but @ 8 bucks and change, I'm willing to invest in CHK.

    I laid out my reasons in the above comment so I don't need to rehash it.

    There are buyers and sellers everyday. Today, I was a buyer of CHK.

    We shall see in 6 months where Mr. Market is.

    Je vous dis adieu.
    Jul 27, 2015. 06:33 PM | 1 Like Like |Link to Comment
  • Chesapeake Energy: An Open Letter To Carl Icahn [View article]

    Todd was wrong per Mr. Market when he wrote this article. Since he wrote it on June 22, and today's closing or July 24, CHK's stock has lost over 30% of it's market value. There is no quibbling that. Todd's thesis, however remains in tact IMO that given it's holdings it should be worth more than $8.27 at today's close.

    The energy market is in free fall due to speculators, Iran's entry into the world oil market, probable diminishing oil demand in China and new oil coming on stream in C and S America in the second half this year. At the same time the small shale E&P guys are going bankrupt, therefore oil, NGLs, and nat gas won't be as plentiful in the US play. I'm sure more bankruptcies are on the way from the smaller players. The question is will the little guy going bankrupt and removing supply match or surpass what is or will becoming online in the next 6 months. Do you know? I don't. And no one knows in three months where Brent or WTI will be. To be sure, Mr. Pickens and Mr. Kinder have thus far been wrong and they both know more than I do about energy. With that said, if educated oil men don't know, no one does.

    Todd has written a persuasive article on SA the other day and per the link below.

    I am not here to defend Todd so please don't take it that way. What I'm saying is he presented a cogent argument on why he thinks CHK is undervalued. I think he is correct. I am not backing up the truck on this stock but I will buy on Monday barring some unforeseen tragedy over the weekend. I don't like to buy stocks that are depressed going into the weekend.

    One of my reasons for buying is that short positions are at an 8 per Yahoo finance. They've added to their positions from the end of May '15 to June '15, per Yahoo finance. Per a commenter in an article that I read there were more put options than call options and by a wide margin. IMO there are too many people betting against CHK. This is a contrarian bet admitedly on my part but I tend to go against the herd.

    I am not blind to CHK's financial metrics. Their overall debt in a market that has a falling commodity price per it's asset base and the FED raising interest rates is not for the faint of heart. At the same time rig counts since last year are down 54% from last year so the drillers and energy service providers are failing pain which makes CHK and other E&P companies have more leverage at the bargaining table.

    Something has to give in the next 6 months. I am confident that the Saudis won't blink so that leaves the majors or the shale producers. I still can't believe that XOM, RDS, BP, TOT, et al are still pumping as much at these prices. Someone needs to tell Mr. Tillerson, et al that fighting the Saudis on oil is like fighting the FED.

    I do agree substantially with your above comment. If Todd would've "manned" up and conceded that he was too early to the market much of the vitriol would've been muted.

    Good luck with your investments.
    Jul 24, 2015. 07:31 PM | 1 Like Like |Link to Comment
  • Chesapeake Energy playing defense, Credit Suisse says in downgrade [View news story]
    Icahn increased his share count in CHK in Q1 to all time high.

    Hedge funds have been also increasing their stakes in CHK starting in Q4 of 2014. Some have taken a real bath so the next 13F should enlighten us all.

    I have a problem relying on hedge funds and the Icahns of the world to invest with them. They do provide stock price support and can agitate for better stock performance but sometimes doing the "right" thing for stockholders is not the best thing for the company.

    Mr. Icahn and most hedge funds are traders not investors. Icahn's recent departure from Netfix is a case in point. I don't begrudge him taking profits and he did extremely well but NFLX as an investment thesis is and was still very sound. I don't have a stake in NFLX.

    I don't see any advantage for investors to buy stocks because Icahn, Ackman, etc., bought them. It is great for price support when they buy but when they sell it works the other way for the herd mentality that is Wall Street IMHO.
    Jul 24, 2015. 04:41 PM | Likes Like |Link to Comment