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Yeah, it is free enterprise!! Can we go way too far on this ? Is Earth dying before our own eyes ? Does quality of life really matter? Do we understand it or what? What is God all about ? Do smokers really have the right to blow smoke into our faces on streets? Should we put them back indoors so... More
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  • Wide Moat Stocks??

    Warren Buffet is well known for choosing stocks that enjoy so called "wide moat" against competition. Everyone knows what stocks he picked, but I know that any competitor can build a Brooklyn bridge across it if he cares to. It is just that nobody is trying as if everybody is going out of his way to please Warren. Warren is not alone , of course. It is just that too many stocks is enjoying "make pretend" moat that stakeholders are so happy to hold.

    It makes me wonder about the real value of today's stock market as I can easily see so many undervalued ones as well as overvalued ones on an ongoing basis. You may ask why I never got rich, well, I can honestly tell you that I believe that there is delay tactics nearly everywhere but a few chosen ones. Here is a simple fact, money cannot chase every stock at same time so they rotate them but somewhat maintain so called the Darling 50 in a secular way.

    This is not really honest because the favored ones are feeding off the many other good ones . it is just money changing..

    Disclosure: The author is long AA.

    Additional disclosure: AA is a true wide moat stock but is being suppressed by Wall Street through global overproduction of aluminium and depressed prices.

    Tags: AA, aluminium
    Jul 10 3:35 PM | Link | Comment!
  • Aluminium At 90 Cents A Pound? HA HA HA HA HA HA ...NOT!

    A Why is it that aluminum prices continue to be pigeonholed at 90 cents for as long as memory can either serve or fail me? We are brainwashed into thinking that it will stay that way for-eeeeever! How we wish that same thing can be applied to gasoline or beef or corn as a commodity!!?? Of course, we wish, too.!

    Granted, a vast majority of you readers probably had no clue how much higher other metals like copper, molybdenum (used to be mixed with steel for high tensile strength like tools), nickel ( there is such a metal called nickel in case you don't know... ), silver, gold, you name it .. had gone up in prices in recent years or past decade? Yes they went up 300-1000% and stayed there..

    Aluminum somehow stayed stuck at same price for past... ( let me remember how long, oh yes, something like 40 years!!) it has been that Looooooooooooooooooong!! since !!!

    Of course, aerospace is one of the first things that probably come to your mind when you hear aluminum being mentioned or is it still your creaking patio furniture still lying around since the 1960's. Why they made it sooo thin that it collapsed if you sort of fell on it.. It is so ridiculous! Or is it the skin of those so called tin homes known as trailers?

    Anyway, there is zillions of new uses for aluminum since the days of patio furniture of the 1960's. Lets take heat sinks that you often see in the guts of your desktop computer cases. We also ride in aluminum framed bicycles now. Even aluminum windows are making another comeback as wood/aluminum clad designs with the wooden side facing inside and the aluminum side facing outside to enhance the durability of wooden windows favored by the upper class clientele.

    As matter of factly, aluminum consumption is fast growing in popularity . Prices are supposed to be "elevated" as demand grows, but it is never the case for aluminum . Somehow, China decided to flood the world with aluminum that it doesn't know what to do with except to please anybody except aluminum stakeholders.

    Now, we are drowning in millions of tons of excess aluminum being placed in sprawling warehouses that dot around the globe. yes, we believe in aluminum as the miracle metal as long as we can get it for dirt cheap! Is this what it is all about?

    Is aluminum prices being manipulated by wanton overproduction with no regards toward the horrible environmental damage through heavy electricity consumption that is required to overproduce it. Where were the environmentalists when we needed them? Carbon dioxide has just passed 4% in our atmospheric peck order , still a long way behind oxygen (possibly falling from normal 21%- it must be around 19% by now , isn't it? )

    Aluminum speculators are still happy to hoard those millions of tons in the warehouses with full conviction that prices for them are a foiled up joke for so long!

    Disclosure: The author is long AA.

    Additional disclosure: it is against my better judgment about this disclosure as I am presently under influence of the Wall Street voodoo therapy.

    Jul 08 5:36 PM | Link | Comment!
  • Got Keogh? Or Got IRA?

    Our stock market is , in fact, a great wealth redistribution engine no differently than our tax code. Both works somewhat differently but remains the same as far as redistribution is concerned. You see, there is institutions, individual investors, mutual fund or pension managements and so forth.

    Well, I am writing this article that focus on individual investors that have Keogh accounts or IRA accounts. I just want to share my ideas about how you can manage your retirement accounts to your own advantages depending on how you view present stock market activity on a day to day basis.

    Usually, you have a portion of your regular paycheck along with contribution from your employer being set aside automatically toward your Keogh or IRA account. Usually, the weekly contribution is used to buy shares in your selected funds as offered by your account director or manager .

    it is June 2014 as I write this article and the stock market is setting new highs of lately. What it means to you is that your weekly contribution is buying fewer and fewer shares as the stocks in general is climbing.

    I am merely suggesting to any of you who may be somewhat at unease about the lofty prices of stocks these days and the fewer shares you are buying weekly. What you can do about it ? If I were you, I would take out the monthly or quarterly statement to find the customer service phone number or website link and contact the director or manager to ask him to stop buying additional shares . Ask him to put your weekly contribution into cash fund like money market or government fund usually known as cash reserves in your Keogh or IRA accounts. It is useful to have such cash reserves handy that you can put in. All Keogh or IRA managers offer such cash reserves account in addition to your selected stock funds or bond funds. Sometimes, you may need to ask your manager to add cash reserves fund selection to your Keogh or IRA accounts. They don't always do that so it pays to find out if you already have such cash reserves account handy .

    You can leave your stock fund alone and stop buying additional shares there and start building up your cash reserves. Here is why. it is currently more likely that the stock market will suffer price corrections or even worse a stock crash due to unanticipated major political or financial disruptions like rising energy prices or health costs as a result of booming senior population that will only keep growing in the coming decade or longer. More retirees will start selling stock in order to maintain living standards that their Social Security checks probably cannot cover all.

    If more of you start contributing straight to cash reserves accounts, this will help force the stock market to consolidate the more realistic values of the underlying stocks . There is no way of knowing which stock or even your selected stock or bond fund is overvalued or not. Only Wall Street institutions know themselves.

    I have no way of telling or knowing when our stock market is already overvalued which usually mean that fewer and fewer shares can be bought , anyway. This is not a good time to buy these days. The laws of diminished returns is fast becoming obvious.

    you can still leave your selected stock or bond funds untouched, but it no longer makes sense to keep buying shares just for sake of averaging it over the time. Unless you still believe strongly that the stock market will keep on breaking new highs for the next several years, it is now wise to stop buying shares now. Leave it as is. Start building up your dry powder keg with as much cash as possible for the next several years. In case, you are wrong about the overvaluation of the stock market, you still have your stock or bond accounts appreciate while you keep building up your cash reserves all along.

    The next stock crash is utterly inevitable but I cannot pinpoint when. I can safely say that it will happen sooner or later. Once it happens, you will be thankful that you had already built up adequate cash in your selected cash reserve account with your Keogh or IRA manager that you can use to buy stocks or bonds at much lower prices later on. This is a better way to average out your retirement portfolio.

    For any of you who are 40 or 45 years old or younger, you will be more forgiven as you will have extra time to heal your retirement accounts. For any of you older than 45-50, it pays to have plenty of cash set aside. However, you may want to start considering special retirement choices like mutual funds that more geared toward which year you are expected to retire. If you are expecting to retire in the year 2020 or 2025 and so forth, you can ask your director or manager to invest to such kinds of accounts like that. There, those funds usually maintain a very high level of cash reserves automatically for you because they know that the stock market goes up and down and they are trying to take advantage of lower stock prices that come along once in a while.

    Just something for you to think about. I am not trying to scare you or anything. It is just that cash remains as the king always.

    Some of you may think you are more savvy than me, I can only wish you a lot of good luck!

    Jun 17 2:11 PM | Link | Comment!
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