Vobogeck

Forget the 1930s; We're Reliving 1975 (Part 1)

I remember the 1973-75 recession well too and agree with Ferdinand E that there was not as much wailing and gnashing of teeth. Of course then we didn't have CNBC and internet blogs screaming at us 24/7.

Medtronic's Healthy Future - Barron's

This is an excellent summary of the case for buying Medtronic, but I would point out one minor inaccuracy. Medtronic's current price of $33.40 is not a ten year low, it is a six-year low. Its 52-week low of $24.06 was a ten year low.

However, its P/E ratio is at a ten+ year low and with a ten year earnings growth rate of 18% pa it is a solid buy under $45 for long term dividend investors.

7 Solid Dividend Stocks

I have been critical of this site in the past, calling it Seeking Bears because it seemingly provides a forum for short sellers. So it behooves me to compliment you for writing a positive article about the merits of long term investing in great companies. I hold 5 of the 7 stocks you mention, many of them for decades. Investing in high quality companies for the long term, and staying invested through troubled times like this, is the only way to achieve long term wealth. It is sad that too many of the people who write on this site don't feel the same way.

A Paperless News World: Kinsley Nails It Again

Just out on Reuters: "Associated Press unveiled rate cuts on Monday to help member newspapers reeling from declining advertising revenue and said it would sue websites that use its members' articles without permission."

Jarvis assumes a static status quo, which is nonsense. The AP response is typical of what will happen, as the news providers stop giving their stories away free to Google etc. Although they may be slow to change, the newspapers will adapt and thrive. They will compensate for reduced advertising with a higher subscription, for those readers willing to pay for in-depth news. If they don't we will be left with the worthless drivel that passes for journalism on sites like Seeking Bears.

I am curious Jeff: how much does Seeking Bears pay you for posting on its web site? Do you get a cut of its advertising revenue? If not, how much longer will you continue to give away your time for free?

Congress: Shortsighted About Financials

Spot on!

10 Reasons Why We Still Haven't Hit Bottom

TEN REASONS WHY WE HAVE HIT BOTTOM:

1. Bearish posts on Seeking Alpha are coming thick and fast.
2. Everyone is saying "buy and hold is dead."
3. The press is full of "sky is falling" stories .
4. The Fed is swamping the market with liquidity yet no one is saying "you can't fight the Fed" anymore.
5. Most investors have given up hope.
6. House building has ground to a near-halt.
7. Oil prices are moving up again.
8. Australian coal contracts settled much higher than analysts expected.
9. The US dollar is finally weakening and will fall further as the fear driven "flight to safety" reverses. Cheaper dollar will improve US exports.
10. Everyone is in cash, and the market quite often moves in a direction to hurt the most people.

Five Impossible Thoughts After Breakfast

What a load of bullshit!

Bank Nationalization: It's Just Plain Wrong

IMHO, the problem with the US banking system is that the REGULATORS allowed:
- leverage up to 30:1,
- securitization of all kinds of risky assets,
- hedge funds operating behind a veil of secrecy,
- and shamefully turned a blind eye to widespread fraud like that of Madoff.

The regulators are empowered by the government, and IMHO it is the government that got us into this mess. The bankers simply responded to the encouragement they were given by the regulatory system, including "encouraging home ownership" among less credit worthy borrowers (as I understand it, this was a goal first set up by the Clinton administration and reinforced by subsequent administrations and the federal home loan organizations)

Why are the Canadian banks in such good shape? Because the regulatory system does not allow such high leverage as we see in the US system, the mortgage lending industry does not allow no money down, teaser initial rate mortgages. Canadians get no tax relief for mortgage interest, so there is incentive to pay off the loan. In the US, the incentive is to have as big a loan as you can. The US government reaped the crop of bad mortgages that it sowed. Don't blame the bankers. The government needs to first fix bank regulations and take responsibility for what has happened.

Temporarily suspending the mark to market rules would be a good start. Nationalizing the banks will just play into the hands of the short sellers, many of whom post on Seeking Alpha. Kudos to Baker for being a voice of reason among the self-serving short sellers.

Cruise Line Stocks May Be the Next to Sink

As I have mentioned before, Seeking Alpha should be re-labelled to reflect its position as the favourite vehicle for shorts like Trader Mark to publish scare stories like this. These sort of stories become self-fulfilling as the chicken littles dump the stock.

There is no "analysis" in this article, just more regurgitating of other people's doom and gloom. Is it possible that cruise line stocks being down more than 50% already factors in the bad news?

Disclosure: I have not cancelled my Alaska cruise booking, have already been upgraded once, and look forward to cruising on a half empty ship. My sister in law is also looking forward to her carribean cruise next month.

Will Royal Bank of Scotland's Reverse Split Help Its Share Price?

This is a no-brainer. Arbitragers will ensure that the ADR will always trade at the ADR ratio (now 20, previously 1) times the London price, adjusted for "friction" caused by ADR fees and exchange rate fluctuations.

Comparing This Past Week to the '87 Crash

Instead of focussing on the single week losses, investors should focus on the third column. Only GM is a long-term loser.

Citigroup Should Walk Away from Wachovia

The "common good" is better served by respecting contract law. Citigroup had a contract and the terms of the contract should be honoured. See Pennzoil v. Texaco.

Did the FDIC Sabotage WaMu's Management and Erode Investor Confidence?

I agree with the previous post. It is nauseating to see the gloating from JPM that the WM acquisition will be accretive to the tune of 50 cents a share.

What Have You Done, Jamie Dimon?

Because depositors withdrew $16 billion from their accounts in less than a week. WM had no liquid assets left. A classic run on the bank. The biggest mystery is why the Feds have not increased deposit insurance to $250k and then extensively communicated through TV ads, etc that this insurance is available to depositors in ALL financial institutions.

The Nationalization of AIG

Who let the geniuses at the investment banks securitize mortgages to people with no income in the first place? The lax US regulators, acting for the government. Who should pay? The US government.

It is a shame that the US exported these junk securities all around the world, and it is a shame that the geniuses at the investment banks don't have to repay their bonuses.

Wall Street, the financial capital of the world, says CNBC.

More like the financial laughing stock of the world...