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TMKrause

TMKrause
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  • Richard Kinder buys 500K Kinder Morgan shares [View news story]
    How long will it take for the SEC or investors to sue Hedgeye for manipulating the market with social media? How much did they make on their tweet?

    Although I don't know all the facts, my gut reaction is that their actions are scandalous and subject to prosecution.
    Sep 9 11:48 AM | 14 Likes Like |Link to Comment
  • Hedgeye Report On Kinder Morgan Fails To Impress [View article]
    Hedgeye is clearly trying to manipulate the market through biased analysis that borders on "yellow journalism." The SEC should investigate how much Hedgeye has made from their tactics and whether or not such action is consistent with the law and fair to investors.

    LINE is currently up 6.6%. I'm not sure why, but I wonder if it is due to Hedgeye's tarnished reputation. If so, I am glad. Investors should not make money by sowing fear; they should make it by allocating funds to companies that can generate superior returns.
    Sep 11 10:58 AM | 12 Likes Like |Link to Comment
  • Windows 8 Fail: Intel Is Dead Money [View article]
    I am reminded by two quotes from Mark Twain:

    "The reports of my death have been greatly exaggerated."

    "It is better to remain silent and be thought a fool than to open one's mouth and remove all doubt."

    An objective analysis is always more convincing than a pre-determined one.
    Aug 26 02:57 PM | 8 Likes Like |Link to Comment
  • The Euromess Continues [View article]
    An excellent analysis.... sobering. Thank you. I would just add that I'm skeptical that Germany will support the ECM with a banking license, which would only be a baby step forward (although a significant signal) toward resolving the fundamental Eurozone problem: Monetary Union without fiscal union or banking union.

    The German courts will decide on whether or not Germany can support he ECM in mid-September.

    With so many countries, and democracy at work, I can't see how there will be a solution in time.

    I expect Spain to default--soft or hard. I think Greece gives us a precedent for what we can expect, and it is not pretty.

    Ultimately, the failure of the Eurozone system is likely to result in significant social unrest. It is already happening in Greece and starting in Spain. If Italy unravels after their elections in March, we face a frightening specter.

    Europe needs a leader now. Not 19 summits with few decisions and no timelines. Soon, Europeans will no longer tolerate this sclerosis, and the markets will need to retreat from their "irrational exuberance" three-day joy ride after Draghi promised a band-aid.
    Jul 30 10:50 AM | 6 Likes Like |Link to Comment
  • Apple Could Destroy Xbox One With An iTV [View article]
    As several others have written, more or less, I think this article has things backwards and is deifying Apple with the hopes that they will overtake MSFT and Sony in a space they have never occupied. That seems unrealistic to me. So, the title of this article is hyped and misleading, in my humble opinion.

    More importantly, the writer made one very important and correct observation. There is a convergence of technology resulting in media integration for the home. This is occurring now and will continue. Even if you buy something as low-tech as a DVD player, you will see that many come with a WIFI internet link, and thus uTube, WSJ, and many other things are now available via your old DVD player.

    What I think is obvious is that MSFT has launched Xbox One, which sounds to me like the leading gadget in this home media integration space. While some gamers will be miffed, non-gamers will be more interested in this integrated product. MSFT is first in this space, far ahead of Apple.

    I think that MSFT is looking forward in a very positive way, even if the immediate results from the Xbox One launch are limited.

    This is the same response that many analysts have given to Windows 8; damning it for lack of immediate results. Again, I think MSFT is looking forward, even if W8 is a flawed product. What W8 does for MSFT is to take them into the tablet and smartphone space in an important way, and to introduce the concept of a common OS for all key consumer IT access products.

    I'm just an ordinary consumer with no special IT expertise, but I like to watch this space, and I my views may be completely wrong.

    Thank you for a stimulating article!
    May 27 12:01 PM | 5 Likes Like |Link to Comment
  • Microsoft's Purchase Of Nokia And 'Go-It-Alone' Strategy Make It A Sell [View article]
    Maybe there is little hard core analysis in this article, but there is some good strategic thinking and guessing, which is all we can do about the future. The Nokia acquisition does concern me. Warren Buffet talks about investing in companies that have a moat to keep out competitors. There is a risk that MSFT's moat will work in reverse: With so many chips on Windows 8 and Nokia hardware, the moat may prevent MSFT from engaging in the most active part of the consumer market.

    So, I think MSFT is at a critical stage of its development. In my view, it still has a lot going for it, but I will look closely at their CEO decision and where the company appears to head with the new team.

    doodoo, you have a good screen name. Your comments remind me of an old joke: Never wrestle with a pig. You will both get dirty and the pig will love it.
    Sep 15 09:29 AM | 4 Likes Like |Link to Comment
  • Microsoft Plus Nokia - How Will Ecosystem Partners React? [View article]
    A good analysis, but I am increasingly skeptical about the IT/smartphone/PC world. There are so many analysts on SA who follow these companies, and we all are interested because smartphones, tablets and PCs are a big part of our new IT lives.

    However, I think we seriously need to disassociate our personal interest in IT toys from what is going on in the market. The IT bubble is past, and while there will be growth in this sector, it is only a sector, and one that faces increasing competition, with less and less brand loyalty.

    For investors who have a diverse portfolio, the small plays in the IT world are a side show to the rapid increases in world-wide interest rates and the related fall in emerging market equities.

    I would love to see as many commentaries on the increase in interest rates and their implication for future investment values, including emerging markets, as I see on MSFT, Apple, Intel, etc. The IT sector has become an obsession amongst investors that is not warranted when one looks at the overall needs and consumption of the global economy.

    Who want's to talk about something else?
    Sep 4 01:26 PM | 4 Likes Like |Link to Comment
  • If Windows 8 is going to give the PC industry a much-needed lift, Microsoft (MSFT) has some convincing to do. Though 6 out of 10 respondents to a U.S. poll done by antivirus software firm Avast said they're aware of Windows 8, only 9% said they would speed up plans to buy a PC because of it, and 74% said they'll probably stick with what they have. Moreover, about a third of Windows users ready to buy a PC said they plan to switch to an Apple (AAPL) product. [View news story]
    With Windows 8, Microsoft is trying to do what noone else has done before, which is to establish a common operating system for PCs, tablets and phones. This is a powerful vision, but not easy to execute. On the technical side, I think Windows 8 will not be robust for at least a year. However, Apple has not taken this common platform approach and could be surprised by Microsoft's strategy, which has been re-enforced by Surface and other Microsoft hardware products, which are likely to be introduced, starting with a Windows 8 phone. Microsoft retail stores may also surprise Apple, although they are obvious copycats and will be dismissed by many for this reason alone.

    Google's decision to dump iGoogle as a home screen will only push users into Windows 8 where you can select and arrange your favorite sites.

    It's a long shot, but I would not count out MSFT yet. Apple has had a long run and the market could be surprised by what MSFT serves up.

    Most importantly, I think investors invest in AAPL for emotional reasons, just as they did with MSFT 15 years ago. Don't be surprised if the market shifts and the love is lost. If so, that means that AAPL's premium may shrink substantially.

    That being said, I'm an Apple consumer and have not bought a Windows 8 product yet, so if I put my money where my heart is... it is with Apple. However, as an investor, I think the next year will be very telling about MSFT's ability to get an edge on AAPL. If they can't do it in the next year, I am bearish on MSFT.

    Note: I have a small long position on MSFT
    Nov 16 05:30 PM | 4 Likes Like |Link to Comment
  • Microsoft Once Again Apple's Biggest Threat [View article]
    The Gandhi quote is wonderful, but to obtain success in the face of extreme skepticism requires morally strong principles and great leadership. Let's wait to see who becomes MSFT's next CEO, and I'll skip the moral stuff!

    You've made an excellent point that MSFT is a conglomerate now, and we all know what happened to the sexy conglomerates in the 1970s. They sold non-core assets and consolidated into one or two sectors, or else disappeared. MSFT needs to do this as well.

    Your comparison between Sony and Apple is a bit of a stretch, but a good catalyst for considering Apple's emerging status as an electronics retail company instead of an IT company. I tend to agree with you and think that the Apple "buzz" around their superior products will slowly degrade in the face of strong competition.

    So, If MSFT is well managed, I agree with you that in the next 5 years, this company will be a better investment than Apple.

    However, let's see what happens with Apple's continued innovation, including the Apple TV.

    For now, I'm happy to be an investor in both companies.
    Nov 25 11:12 AM | 3 Likes Like |Link to Comment
  • By Far The Strongest Coal Producer, 31% - 42% Upside Potential [View article]
    Peter, since you are a coal bull, can you please explain to me how you see the impact of low-priced natural gas on the coal industry? While NG has had a huge rally earlier this year to over $3, it's not clear to me why? Following the US winter season, there was nearly twice the inventory of gas than usual. Many analysts are predicting NG prices, long-term, closer to $2. As a result, I'm hearing that many utility companies are switching to gas. You obviously have a different view. Can you enlighten us? Thanks!

    PS I agree ARLP is a star in the coal world, but they are also down 18% in the past year, despite their high dividend. What will reverse the fairly strong negative trend on most coal companies?
    Jul 30 10:22 AM | 3 Likes Like |Link to Comment
  • Are Emerging Markets Heading For Significant Strength? [View article]
    A good article, Michael and some interesting correspondence as well. I am not good at broad market models or charts. Rather I make judgments about the markets based on how I see first medium-term fundamentals, and second, long-term fundamentals, including not just macro factors (although I think they are key), but also micro and business sentiment in different markets. As background, I've been investing, mainly private equity, in emerging markets for over 20 years, and I've now lived in emerging markets for the past 12 years; the first 7 in Hong Kong, and the last 5 in Russia.

    So based on my totally un-scientific approach, I'm not convinced EMs are ready to come back yet, as there is too much noise in the developed markets right now (the Eurozone and US Presidential election) and some weakening in many of the key EMs. China's growth is slowing as it has lost some of its FX advantage as the world's factory, and after over-heating by municipal and sub-sovereign lenders, which will take some time to unwind. India's currency has depreciated rather dramatically and it's market looks expensive with inadequate domestic fiscal and regulatory reforms. (TPG's Bonderman recently said at a conference that he didn't know why TPG was in India!) Brazil has also become expensive. Russia is still cheap, but no one cares about Russia because it's too scary and it's economy relies too much on oil, so be prepared for volatility. Central Europe has become a no-mans land given developments in their still-wealthy neighbors to the West.

    However, there are some bright spots, which probably include Indonesia, Turkey, Africa, Columbia, Mexico, and no doubt a bunch of other smaller markets where there's little liquidity. However, China is the gorilla in the room, and they will have their political transition in the Fall; after that, the new administration will need to stop keeping the market afloat through rate changes and begin to deal with more fundamental problems in the economy, which may mean slower growth.

    So, I think we need a rally in the US and/or Europe to spark a big rally in EMs. I think there is almost zero chance we will see a rally in Europe, although we could see enhanced stability if the Europeans finally have the ... to turn the EFSF into a bank that can provide liquidity directly to Sovereigns instead of channeling liquidity through European banks to the Sovereigns, which only endangers the banking sector and postpones needed fiscal reforms.

    Now, we are back to the US and the November presidential elections. Without getting into politics, my sense is that if Obama wins, the markets may actually rally a bit because of the continuity this will bring to his current policies, which are not perfect, but have brought America back from the W abyss, which is where Obama started 3 1/2 years ago. If Romney wins, I think we will see all the trauma that goes with a major governmental transition, with even greater polarization in Congress, which is bad news for all of us.

    My conclusion: The US markets are not doing badly, particularly if you are invested in conservative equities that provide a yield, and the banking sector looks like its about to rally, as do some techs. If the Europeans begin to actually do something besides posture rich vs. poor countries (really anything), and if Obama wins in November, we could have a good December, and better prospects for 2013.

    As for EMs... our original topic... no doubt they have a higher beta, and as the West gets its act together, or at least limits the downside, they are likely to rise more quickly than the Western markets, but keep an eye out for China after their political transition this fall.
    So, Michael, you may be right after all!

    Would love to hear the view of others.
    PS. I have very limited positions in EM stocks, and am mainly invested in conservative US equities with decent yields. I am not a professional financial advisor or analyst.
    Jul 15 11:25 AM | 3 Likes Like |Link to Comment
  • Greek Default And The Unintended Consequence Of Profound Certainty [View article]
    Eric, you are right on the mark. Greece is the camel's nose under the tent, and there are a few shoes left to drop (Block that metaphor!). Seriously, I don't believe the European Union will survive in its current state. Only the strongest countries will continue in the Union; the weaker ones, in the South, will need to re-acquire their independent monetary policy to survive politically and economically. Greece will be the first to leave the EU when they cannot meet Germany's standards, or when they are sufficiently offended (which is past due). What this will mean for Europe is recession or depression. The bigger question is what it will mean for China. Will China be able to adjust to lower external demand? So, in the long-term, the question is not Europe. It is the extreme surplus in China and the deficit in the United States that must be resolved. Mr. Keyne's would have a strong view on this, as he faced a similar dilema after WWI, with the UK in deficit and the US in surplus. How the world changes! Future currency values will be fundamental to overall returns in the next 10 years.
    Mar 11 03:19 PM | 3 Likes Like |Link to Comment
  • Sell Verizon - Its Brand Value Is Tarnished [View article]
    Agree with many others that this article is short-term myopia. I see no long-term implications for Verizon.

    Political implications of the cyber-spying is another question, but also very complex since Congress has been well-informed and cannot blame the Executive Branch. Mostly, I think average Americans MAY lead the protest against the government collecting such gigantic amounts of information at their new humongous data centers in Utah and Maryland. I don't believe that government analysis will be limited to foreigners, and even if it is, I think this is a direct violation of the First Amendment passed on December 15, 1791:

    "Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances."

    I leave to lawyers to decide exactly how invasion of personal correspondence violates American freedom of speech, but I am almost certain that it does.

    I sincerely hope that Americans will overturn the Prism program which has echoes of Orwell's 1984 and the abuses of the former Soviet Union. The last thing America needs today is the return of a new strain of McCarthyism.
    Jun 11 11:55 AM | 2 Likes Like |Link to Comment
  • What's up with mortgage REITs and special dividends (first CYS, now AMTG)? REIT dividends have always been taxed as ordinary income, and thus won't be hit by a hike in the dividend tax rate. It smells of the companies trying to throw in some nominal good news amidst big dividend cuts. Trouble is, the use of this "slush fund" money now makes bigger cuts more likely in the new year. AMTG now -0.2% premarket. [View news story]
    There is a very simple explanation to this. Because a REIT is a unit trust, it must pay out 90% of its income to its unit holders (read, shareholders), or it will be subject to tax at the Trust level. Here's a basic explanation of how REITs work: http://bit.ly/Xm9DF3

    AMTG did not increase its dividends during the year to account for its increasing levels of income. As a result, it needed to declare a special dividend for Q4. I think this was widely expected by the market, as a well-informed Alpha writer predicted this special dividend several months ago.

    Also, please note that the dividend will be paid in January of next year and recipients will be taxed at the prevailing income rates for 2013, which are currently unknown. So the idea that the special dividend is designed to save shareholders taxes is incorrect.

    Others on Alpha have analyzed AMTG and understand the fundamentals of the company much better than I do. However, I don't think the special dividend means that the company is now rushing to increase dividends which will decrease their ability to pay a consistent yield in the future.

    As with all mREITs, AMTG's income will depend on interest rate movement, whether they buy agency or non-agency mortgages, the overall performance of the mortgage market, and actions by the Fed to buy mortgages which can distort the market quickly.

    I am long AMTG.
    Dec 14 10:33 AM | 2 Likes Like |Link to Comment
  • Is It Time To Buy Teva? [View article]
    Great, succinct reply. I agree. My only question is why the market continues to treat TEVA like an ugly stepchild. Other pharmas have had big increases, but TEVA never seems to realize its upside potential. Any thoughts on this, or are TEVA shareholders only more patient and smart than others :)
    Sep 21 01:32 PM | 2 Likes Like |Link to Comment
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