Mike K's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.comuser/1914/comments http://seekingalpha.com/article/84204-what-if-what-economists-taught-us-is-wrong?source=feed#comment-201389 201389
Case in point: Banks are liquidating homes in the low end right now below 2000 prices in the very low end in southern california, despite the higher end not having come down enough. I actually believe this is below where the market will stabilize. Furthermore, their minimal carrying costs combined with a booming rental market put them in the perfect position to become landlords and actually *not loose* any more on these properties without liquidating.

So why aren't banks in the business of becoming landlords? Status quo. There is an arbitrary rule that banks blindly follow that is keeping them out of the business. The same arbitrary rules misrated subprime debt (rating agencies' fault), with banks blindly following suit (bank manager's faults). When there is no one with common sense nor initiative driving the car, of course it will crash. Perhaps one could blame the corporate shield for this - no otherwise intelligent individual would have taken the risks personally that banks were taking this past 5 years. But the corporate shield allows behavior that goes unchecked -- a firing is in no ways a meaningful threat when decisionmaking can be levered to have downside that in no way equates with the punishment.

So let me propose: It is greed, the corporation, and sheepish herd mentality that got us into this mess. Not laws or doctrines of economics. Fundamentally, people are stupid? Take a look below.

www.youtube.com/watch?...
]]> Wed, 09 Jul 2008 10:58:12 -0400
Case in point: Banks are liquidating homes in the low end right now below 2000 prices in the very low end in southern california, despite the higher end not having come down enough. I actually believe this is below where the market will stabilize. Furthermore, their minimal carrying costs combined with a booming rental market put them in the perfect position to become landlords and actually *not loose* any more on these properties without liquidating.

So why aren't banks in the business of becoming landlords? Status quo. There is an arbitrary rule that banks blindly follow that is keeping them out of the business. The same arbitrary rules misrated subprime debt (rating agencies' fault), with banks blindly following suit (bank manager's faults). When there is no one with common sense nor initiative driving the car, of course it will crash. Perhaps one could blame the corporate shield for this - no otherwise intelligent individual would have taken the risks personally that banks were taking this past 5 years. But the corporate shield allows behavior that goes unchecked -- a firing is in no ways a meaningful threat when decisionmaking can be levered to have downside that in no way equates with the punishment.

So let me propose: It is greed, the corporation, and sheepish herd mentality that got us into this mess. Not laws or doctrines of economics. Fundamentally, people are stupid? Take a look below.

www.youtube.com/watch?...
]]> http://seekingalpha.com/article/83022-vix-is-complacent-despite-new-2008-dow-low?source=feed#comment-194428 194428
Right now the 'if crude > yesterday price, sell S&P' program is running the show.

I think the market assumes the fed has no possible tricks under its sleaves, so is not buying puts, instead is getting short directly.

]]> Fri, 27 Jun 2008 15:26:27 -0400
Right now the 'if crude > yesterday price, sell S&P' program is running the show.

I think the market assumes the fed has no possible tricks under its sleaves, so is not buying puts, instead is getting short directly.

]]> http://seekingalpha.com/article/82984-time-to-short-both-long-term-bonds-and-crude?source=feed#comment-194329 194329
In reality, I'm thinking the short oil side will be likely what performs sooner, as the helium gets let out of the bubble. Massive economic slowdown (which the stock market is shouting) portends to deflation and commodity collapse with falling aggregrate demand.]]> Fri, 27 Jun 2008 13:00:40 -0400
In reality, I'm thinking the short oil side will be likely what performs sooner, as the helium gets let out of the bubble. Massive economic slowdown (which the stock market is shouting) portends to deflation and commodity collapse with falling aggregrate demand.]]> http://seekingalpha.com/article/82984-time-to-short-both-long-term-bonds-and-crude?source=feed#comment-194323 194323 Fri, 27 Jun 2008 12:56:47 -0400 http://seekingalpha.com/article/82984-time-to-short-both-long-term-bonds-and-crude?source=feed#comment-194263 194263
The winner simply plays a new game (innovation).]]> Fri, 27 Jun 2008 12:05:18 -0400
The winner simply plays a new game (innovation).]]> http://seekingalpha.com/article/82984-time-to-short-both-long-term-bonds-and-crude?source=feed#comment-194231 194231
I'm all for getting off oil entirely. With a massive nuclear power plant buildout (and mass production of nuclear facilities) we could achieve an all-electric transportation infrastructure making peak oil worries a thing of the past. Then comes CO2 sequestration to algae ponds from coal production to create more liquids (and double coal's burning efficiency, reducing emissions). Then comes room to destroy a ridiculous ethanol subsidy policy and even possibly *tax* biofue producers for the use of corn and soybean for other than food purposes - this will fix food inflation. All without central banks hiking rates.

The middle east exporters will have trouble selling their 'black gold' for $15/barrel when that happens.

Too bad nobody is listening.]]> Fri, 27 Jun 2008 11:40:23 -0400
I'm all for getting off oil entirely. With a massive nuclear power plant buildout (and mass production of nuclear facilities) we could achieve an all-electric transportation infrastructure making peak oil worries a thing of the past. Then comes CO2 sequestration to algae ponds from coal production to create more liquids (and double coal's burning efficiency, reducing emissions). Then comes room to destroy a ridiculous ethanol subsidy policy and even possibly *tax* biofue producers for the use of corn and soybean for other than food purposes - this will fix food inflation. All without central banks hiking rates.

The middle east exporters will have trouble selling their 'black gold' for $15/barrel when that happens.

Too bad nobody is listening.]]> http://seekingalpha.com/article/82994-ttm-speculative-activity-actually-decreased-on-the-nymex?source=feed#comment-194218 194218 Fri, 27 Jun 2008 11:31:43 -0400 http://seekingalpha.com/article/82931-when-central-bankers-clash-stock-markets-can-crash?source=feed#comment-194213 194213
In other words, dropping a nuclear bomb onto developed economies will achieve the same thing as hiking: dropping aggregrate demand, thus lowering prices. Its a zero sum game guys... People suffer just the same thru lost jobs from declining economic activity from tight interest rate policy as they do thru inflationary moves.

Now if you fix the energy problem (which is doable if we divert our outrageous defense spending to alt. energy spending and subsidization), you fix the food problem at the same time, and end this cost push driver.

]]> Fri, 27 Jun 2008 11:28:51 -0400
In other words, dropping a nuclear bomb onto developed economies will achieve the same thing as hiking: dropping aggregrate demand, thus lowering prices. Its a zero sum game guys... People suffer just the same thru lost jobs from declining economic activity from tight interest rate policy as they do thru inflationary moves.

Now if you fix the energy problem (which is doable if we divert our outrageous defense spending to alt. energy spending and subsidization), you fix the food problem at the same time, and end this cost push driver.

]]> http://seekingalpha.com/article/82994-ttm-speculative-activity-actually-decreased-on-the-nymex?source=feed#comment-194099 194099
Distraction by bad statistics is ... well.... bad?]]> Fri, 27 Jun 2008 10:15:13 -0400
Distraction by bad statistics is ... well.... bad?]]> http://seekingalpha.com/article/12654-good-sign-for-homebuilder-stocks?source=feed#comment-52536 52536
www.marketwatch.com/Ne...;siteid=google&amp...

This provides a better gauge of what is to come. The trend is down. Of course, if Bernanke drops rates 1% (hah!) then the story changes.]]> Wed, 28 Jun 2006 13:25:10 -0400
www.marketwatch.com/Ne...;siteid=google&amp...

This provides a better gauge of what is to come. The trend is down. Of course, if Bernanke drops rates 1% (hah!) then the story changes.]]>