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  • The chances for a fiscal cliff deal in the next 48 hours are "exceedingly good," says Senator Lindsey Graham, appearing on Fox News. "Hats off to the President, he won," Graham adds. "The President campaigned on raising rates and he's going to get a rate increase." [View news story]
    Bret, the recession Reagan gets credit for getting us out of started after he was elected and was primarily a product of the Federal Reserve increasing interest rates to unprecented levels in order to induce a recession and bring down inflation. The Federal Reserve induced that recession and then subsequently, with some fiscal stimulus, reversed monetary policy and brought us out of the recession. The recession that Obama walked into was a crisis/bubble induced balance sheet recession that was structural in nature. Balance sheet recessions can only be fully recovered from by public and private sector deleveraging, which can take years, if not decades.
    Dec 30, 2012. 10:45 AM | 25 Likes Like |Link to Comment
  • Dividend Investors Beware: A New Paradigm Shift Is Coming [View article]
    Well said Tom! It is very interesting because I have talked to many small business owners about how they will react to higher tax rates in the near future and their reaction has been almost universally exactly opposite of what the supply-siders would have you believe that it would be. Almost all of them said the if the government take a higher percentage that they will work harder and smarter to make more money to offset the impact to their discretionary income.
    Mar 26, 2010. 08:39 AM | 14 Likes Like |Link to Comment
  • No matter what the Fed says about a slow recovery, more than half of Americans say the U.S. economy is in a recession or depression, a new Gallup poll shows. The number who think we're in a depression: 29%. It's hard to see how the economy can truly recover "when so many people believe that it has not recovered at all," Doug McIntyre comments.  [View news story]
    Lakeaffect, thanks for your fact based pramatic comments. I know many people, some who are doing quite well financially, who "believe" that the economy is still in a recession and any signs to the contrary are artificially created by goverment spending and monetary policy. I think if we filtered these poll results by political affiliation we would see a significant deviation between political affiliation in terms of belief in the current economic recovery. The Republicans and alike were so entrenched in there opposition to both the stimulous, TARP and QE1&2 so it is very difficult for those people to admit that we are indeed in a sustained recovery.
    Apr 28, 2011. 02:57 PM | 11 Likes Like |Link to Comment
  • Hold off on bargain shopping - El-Erian [View news story]
    They only blew it if they measure their success week to week, however if they measure their success in five year increments the jury will be out for quite some time and if they bought quality stocks at attractive valuations the probability of success over the long-term is quite high.
    Oct 12, 2014. 04:08 PM | 10 Likes Like |Link to Comment
  • Fixing Wall Street: Cutting The Gordian Knot [View article]

    That was a spectacularly written and comprehensive guide to what is wrong with the global economy and why 10's of thousands are protesting. These 10's of thousands cannot articulate their grievances as you have, but I think you nailed it.

    As far as executive compensation in U.S. company's, it is far out of whack. It is justified by what you described as "paying whatever it takes to get the best". But answer me this question: Our companies are competing in a global economy that is driving labor costs down with the exception of executive compensation at U.S. companies, but why is this when comparable executives of foreign companies make far less than their U.S. counterparts?
    Oct 17, 2011. 02:44 PM | 9 Likes Like |Link to Comment
  • Wall Street hopes John Boehner will offer reassurance in his NYC speech tonight that Congress will "negotiate and debate" but "when it comes down to brass tracks, they are going to raise that debt ceiling." Instead, the House Speaker appears set to demand trillions in cuts to get a debt ceiling hike, setting up a collision course with Pres. Obama and Democrats.  [View news story]
    How's that austerity thing working out for Europe? You do not impose sharp cuts in goverment spending at the same time that you are trying to get economic growth to take hold. This is ridiculous and is purely political,which is what is so disheartening because these politicians have, in my opinion, a fiduciary responsibilty to the citizen's of our country to do the right thing, not the politically convenient thing.
    May 9, 2011. 08:35 PM | 9 Likes Like |Link to Comment
  • Perspectives On Friday's Sell Off [View article]
    Tack, you are 100% right. I have been an equity portfolio manager for over 15 years and I have never used stops. I have seen a couple of "boutique" asset management shops try to build a business around strategies using a sophisticated system of stop losses on the portfolio and none of those companies are around today. Most volatility is systematic and not driven by company specific issues, therefore it should not cause you to sell. If bad new is company specific, more time than not it is made public in after the market closes or before it opens in the morning, thus rendering stop loss orders useless. Beyond all of that, broad market indexes outperform most investors and the very assute professional investor who have outperformed the market over time are long-term valuation oriented investors who certainl do not utilize stop loss orders. When a portfolio manager like me spends the amount of time we do researching and building a position in a company, we do not allow our sell decision to simply be volatility driven. In reality, it is that downside volatility which enables an investor to buy the stock when it is irrationally trading at an attractive level.
    Jan 30, 2014. 07:42 PM | 8 Likes Like |Link to Comment
  • General Motors: Massive Share Buyback A Victory For Hedge Funds And Shareholders [View article]

    The forward P/E on current year estimates excluding one-time expenses is around 8X and the forward 2016 P/E at the current price is around 7.7, not including the impact of the buyback.

    With a forward EPS growth rate of approximately 10% and a 3.8% forward dividend yield, GM's current valuation is very compelling based upon these metrics.
    Mar 9, 2015. 08:18 PM | 7 Likes Like |Link to Comment
  • House Republicans - including House Majority Leader Eric Cantor - are reportedly overwhelmingly opposed to the fiscal cliff deal approved by the Senate. The House appears poised to amend the deal and send it back to the Senate, setting up a legislative high-wire act. [View news story]
    I hear the House Republicans who oppose the deal saying that they are the voice of the people, but if they are truly interested in the voice of all the people, they would bring the bill up for a vote for all the house so we can hear the voice of all the people.
    Jan 1, 2013. 05:27 PM | 7 Likes Like |Link to Comment
  • U.S. Taxes: Who Makes And Who Pays - More Than The Rich Will Have To Pay More [View article]
    constable, you are absolutely correct. The Republicans are keen on saying that the Keynesian economics that Democrats like to cling to has proved to be a failure. However, that is not correct because Keysesian economics was only half implemented over the last 30 years except during the Clinton years. The problem, as I see it, is that supply-side economics is incompatible with true Keynesian economics in practice because Keynes advocated raising taxes and cutting spending during the good years and doing so is incompatible with supply side economics. In the Clinton years we did raise taxes after the 1991 recession was over and the economy was growing again and he did attack government spending over his two terms with his "Reinventing Government" initiative. The economy grew, employment creation was strong and we had a budget surplus after 7 years.
    Dec 9, 2012. 11:53 AM | 7 Likes Like |Link to Comment
  • Why Activist Investors Should Aggressively Pursue Alcatel-Lucent [View article]
    Thanks Brian! ALU is certainly an interesting investment - the consummate special situation.
    Feb 11, 2015. 08:07 PM | 6 Likes Like |Link to Comment
  • Retirement Strategy: It Is A Correction, Not A Crash [View article]
    Using Chowder's logic, President Carter should get the credit for Reagan's 2nd term economy and Reagan's 1st term policies should be blamed for the S&L crisis and the 1990-91 recession.
    Oct 13, 2014. 01:44 PM | 6 Likes Like |Link to Comment
  • U.S. Taxes: Who Makes And Who Pays - More Than The Rich Will Have To Pay More [View article]
    cross, you are right. The myth that higher tax rates will reduce business investment is just a convenient myth perpetuated by those opposed to any tax increases. The most important thing for me as a business person is that my customers have growing discretionary income. That generally means that the tax burden on the vast majority of the public needs to stay relatively low, but as far as the very wealthiest of society, their discretionary income has continued to rise year after year for 25+ years and they have more discretionary income than at any time in U.S. history.
    Dec 9, 2012. 03:04 PM | 6 Likes Like |Link to Comment
  • Market: Spooked Today, But Panic Attack Is Likely Temporary [View article]
    Oh, by the way on the banks going under, big surprise! Earlier this year we heard that over a 1000 banks were going to be seized, I think we just went over 100 a couple of weeks ago. This was a brutal recession, unemployment will stay stubornly high, banks will continue to fail and consumer spending will be lackluster for the foreseeable future. Most of us who are reasonably constructive on the market are not basing that premise on everything being back to normal next year, that's not going to happen. However, many stocks are still quite cheap and are profitable and growing. Many stocks are cheap because traders were focused on the quick hit with junk like many financials and consumer stocks, while good solid industrial, staple and energy stocks have been neglected. This is not a market where you can buy the S&P 500 and do well; one must pick his or her spots and not wait till the stock is overvalued to sell.

    On Oct 30 10:37 PM Archman Investor wrote:

    > Not even worth a real comment here. Just more of the same from the
    > author who rationalizes every piece of news as good for his asset
    > gathering buddies.
    > BTW another half dozen banks just went under tonight.
    > Yeah, everything is good.
    Oct 30, 2009. 11:48 PM | 6 Likes Like |Link to Comment
  • Upping Our Fair Value Estimate Of Alibaba [View article]
    BABA's stock price decline has pulled YHOO's stock price down over the last several weeks. Just like over the last two years, the market has not accurately priced YHOO high enough based upon the sum of the parts, including the BABA stake. At $100 per share for BABA, it is very hard not to conservatively get to $55 per share for YHOO. If BABA were to trade up to $120 as the author indicates is justified, there is really no reason that YHOO would not be worth between $60 and $65 share.
    Feb 6, 2015. 09:21 PM | 5 Likes Like |Link to Comment