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sportsguy

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  • John Hussman: These Go To Eleven [View article]
    john,

    while i agree with your analysis, the subtle globalization of the stock market may have disconnected the relationship between the value of the US stock market and related indices, and the US domestic economy. What happens to the relationship between the equity indices and the US economy IF global investors abroad decide that the SPY is the best investment for 30% of their investable capital?

    What I worry about is the Caymen Island effect, where the local economy has no relationship to the corporate headquarters and equity markets which are domiciled on the island. The island people see empty offices which occassionally have a meeting every quarter, and pay minimal taxes to support the local economy, but the offices have the address in the country. Now this is an example of the potential disconnect, which may be occurring in the US at the moment. . and may get worse in the future

    and I am a subscriber to your emails!

    sportsguy
    Nov 17, 2014. 02:47 PM | 1 Like Like |Link to Comment
  • QE To Propel Market Treacherously Higher After Taper Ends [View article]
    One of the best articles of the year. Technical, but understandable, and importantly stated that all effects are not equal and immediate, as a simple assumption would like it to be.

    James A. Kostohryz is one of my top 5 authors at SA

    sportsguy
    Jul 11, 2014. 11:02 AM | 8 Likes Like |Link to Comment
  • Market Outlook - Is The Market Melting Up? [View article]
    Market volatility will continue to decline as ETF trading increases. ETF by definition is passive investment, and by definition passive investment has zero volatility. ETF volume only passes the net change in outstanding shares through to the actual stocks, so ETF volume is irrelevant, just ETF share ownership. So I expect the volatility to continue to new lower levels as the current market conditions persist.

    Wall Street can't create new investment products and not change the old investment products, its a zero sum game for the most part. . . shift to passive = remove from active. . .
    Jun 23, 2014. 11:28 AM | 1 Like Like |Link to Comment
  • Spinning Your Wheels [View article]
    Cal,

    great investment and outcome so congratulations! What you have to accept is that investment and trading involves a tremendous amount of EVENT risk, trillions times more so that having a job and going to work every day. Think 9/11, flash crash, takeovers, bankruptcies, read Didier Sornette's work. Event risk can be classified as extremely random, which makes forecasting and predicting nearly impossible. Likewise, the shorter the time frame, the more difficult. You were successful on a longer term time frame, don't equate the shorter term events with the longer term investments.

    Investments and trading is merely assuming/forecasting/p... that past patterns will repeat in the future, its as simple as that whether you are a quant or a value investor, a portfolio manager or day trader, long or short, even when mathematics is involved.
    May 20, 2014. 06:40 AM | Likes Like |Link to Comment
  • Spinning Your Wheels [View article]
    Cal Boomer,
    Investing or trading is always about a future positive expectancy. The fact that the future is uncertain, very uncertain, means that many will be wrong. But there is no one rational who trades or invests for directional gain, either with a portfolio or individual equities who is wanting a futuristic capital loss. Therefore there is an implicit expectation of directional movement in the chosen instrument. The other issue is that everyone has a motive, whether its to manage your money, past performance is the sales pitch, or ego, having the correct forecast to have you subscribe or be a follower.

    Can't have it both ways. . .
    May 19, 2014. 10:08 AM | Likes Like |Link to Comment
  • Spinning Your Wheels [View article]
    excellent analysis of the current psychology. I believe that the bond market is signalling a velocity of money slowdown, which is a result of decreased discretionary spending due to increase in taxes and food / rental inflation. Layoffs of the *quality* jobs continue, happened this month at my company and has been announced more will go in quarter 3. EPS growth is being accelerated with share buybacks, and will continue until the expenses can't be cut anymore and revenue growth doesn't support the stock buyback excess cash flow. Then the final collapse will happen, which will be several years from now. The US is facing a huge funding issue in the next 20 years as boomers retire and expect social security payouts from contributions from the glory days. the shrinking mid class jobs being replaced with service jobs at half the salary wage, resulting in reduced SS contribution levels under the current structure. When will the final collapse come, don't know, but its is inevitable as Congress is reactionary, not proactive, and won't be able to prevent the final collapse.
    May 18, 2014. 09:06 AM | 4 Likes Like |Link to Comment
  • Retail warning: Apparel sellers at ground zero of promotional frenzy [View news story]
    Must match this data against gift card purchases which are future sales - store sales plus gift card sales = holiday spending!
    Dec 23, 2013. 11:24 AM | 4 Likes Like |Link to Comment
  • Has Warren Buffett Nailed Another Market Top? [View article]
    Does valuation timing = large macro cycle timing? correlation, but not necessarily causation? I would assume so, since the two go hand in hand. However, buffet's behaviors indicate valuation timing, which one can infer long macro cycle timing into your portfolio behaviors. . .
    Sep 20, 2013. 03:46 PM | Likes Like |Link to Comment
  • J.C. Penney's Underlying Cash Burn Is Worse Than It Appears [View article]
    Common retail strategy is not to let any competitor have uncontested customer base. The more important point is if there is a significant retail company consolidation, JCP and including Bon Ton, and some of the other weaker retail companies, that puts direct pressure on the mall operators' profitability and occupancy results, evan Macy's not getting the growth at the same malls. . .

    there is a macro cascading effect here, and full disclosure I am short JCP looking for a good covering pricing. .
    Aug 30, 2013. 10:03 AM | Likes Like |Link to Comment
  • J.C. Penney's Underlying Cash Burn Is Worse Than It Appears [View article]
    Interesting observation on JCP and SHL, from an interview on CNBC, is that JCP and Sears have very, very similar customer demographics. Can both existing in the same location and both be strong? If JCP goes done, its a large portion on SPG SImon Properties tenant base. .

    hmmmmm
    Aug 28, 2013. 05:37 PM | Likes Like |Link to Comment
  • Why A 1987 Crash Is Not In The Cards [View article]
    1987, of which i was short going into the day, thanks to marty Zweig, and paid for my MBA that day, had a non envent computerized negative feedback loop action, which had never happened prior to that day. The halts are designed to break that negative feedback loop action. So, the question in a computerized trading world of today? is the halt enough to break a current day non event driven negative deedback loop? if yes, is it enough to break a current day event driven negative feedback loop. That question is unanswerable, as it depends upon the severity of the event. Lets image a very large negative event, such as a nuclear bomb detonation or a very large asteroid hit of a major city. . . that question is more tenous, especially with the human reactions . .

    However, absent an event, assuming that there is a valuation point where stocks will become very cheap to buy, the market should not continue down indefinately at that point. What the market participants don't know at the moment is, " what is the fair value growth multiple without QE and all the fed programs?". . . no one knows for certain, and the best way to find out is to pull the plug and see. . . but i suspect that its not that far down that there needs to be trading halt. . . as the earnings are known, just not the growth rates. .
    Aug 23, 2013. 02:51 PM | 1 Like Like |Link to Comment
  • Tesla's Non-GAAP Fairy Tale [View article]
    Tesla is the perfect example of why long investing in new products is so, so much riskier and harder to see the future with more certainty than short selling. Its far, far easier to screw up any company and go bankrupt than it is to create the next cisco type, 20 year growth company. BTW I worked for a cisco competitor and watched about 10 other competitors go under. And I worked for one of the companies that had the best patents and products prior to cisco. . . and the company went under. its just too, too easy to have a product failure ahead of its time or not change with the times. just look at some of steve job's inventions. . . my only disagreement with the some of the arguments is that electricity can and is being generated without oil or natural gas. . . but the population growth vs food and water supply is by far the biggest challenge the earth's population is facing.
    Aug 16, 2013. 07:20 AM | 4 Likes Like |Link to Comment
  • A Macro Approach To Forecast The S&P500 [View article]
    One question, if the S&P500 earnings have an increasing proportion of foreign consolidated earnings, where is the effect of the USD and the international earnings growth/decline factors?
    this model then assumes that the world GDP and the US GDP are highly correlated, no?

    I would argue that the value of the USD does influence the embedded dependent variable SP500 international earnings. If you broke the model into domestic and intl earnings, and created an earnings model for each, I would say you have got the modeled nailed. However, intl earnings are much harder to capture. Consider setting up an historical estimate for that from the top 100 intl companies with some research. . break the international into Europe and ROW, and now you have a good change of being more accurate on the earnings forecast. . .

    BTW, I have a published article on forecasting the SP500 using time series regression in the early 90's and the model was very accurate. AND I have this same model using RATS software, but haven't kept it up to date, and yes, one can create variables for exogenous shocks in a time series model. Do some research on the financial models of Didier Sornette. Agreed though, what is difficult is forecasting the type and severity of the next black swan as its probability of being different from past black swan events is very high. . . the future is truly uncertain. . .

    sportsguy
    Aug 10, 2013. 11:18 AM | 2 Likes Like |Link to Comment
  • Medical Marijuana: Get Out Now [View article]
    Bought at 5 cents, sold at 30 cents. . . . thank you very much Todd Harrison! all done with this stock!
    May 23, 2013. 03:53 PM | 3 Likes Like |Link to Comment
  • The End Of The Consumer? What The Long-Term Decline Of Consumption Means For Investors [View article]
    What is the portion and growth rate of Consumer companies international, non domestic revenue and operating income?

    just curious, because if the non US revenues and operating income is growing at a healthy rate, due to corporate expansion, then the analysis might just be missing the key piece of information. . .
    May 8, 2013. 05:44 PM | 4 Likes Like |Link to Comment
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