Swiss_Buffett

7 Comments

    • Death of Value Investing? Way Overstated [view article]
      CFC certainly is rather speculative at this point. BAC could turn out to be a good one, depending at which price you got in (best was mid-July). If either turns negative on you I'd rather sell them then immediately and rebuy later again. The financial/lending mess may not be entirely over with yet, so some caution is still advisable. Sep 04 03:15 AM
    • The Reason to Ignore Most Economists [view article]
      Just because GDP has not had 2 consecutive quarters of negative "growth" does not mean that there is no recession. Especially the labor market has been weak, and that the consumer is pinched serverly.

      Kudos to Todd if his falling home price value does not matter to him and his lifestyle. But apparently there are millions of other folks who were not so restrained and indebted themselves far more than they should have thanks to ever increasing home values. Now that the ever pyramiding lending schemes have dried up, somebody will hold the bill. And that's always the consumer - and that's bad for the US economy and eventually may very well be bad for the global economy (especially China).       Aug 29 04:01 AM
    • Starbucks Earnings Will Suffer From Closures Through Mid 2009 [view article]
      Todd, I have been reading all your posts here on SBUX, and you have been right in basically every single aspect. However, I wonder how much worse the news might still get for SBUX as the stock has not sold off much since their Q3/FY08 earnings release. I wonder if there is more downside for the stock price. My "feeling" is that as long as the international story remains intact, maybe $14/$15 is the bottom. Also there is this Peltz investor who might keep accumulating shares at these prices, putting a floor under the stock price.

      But could the international story turn sour on them? I think it could. China's largest export market (the U.S.) is in pain and it should be expected that this will cause a slowdown in China as well. Interestingly, HSBC Bank in their latest earnings release spoke of (starting) slowdowns in some parts of Asia, and they can feel the pulse pretty well in the region I would think...

      I guess a good indicator would be if insiders started buying the shares again. Even Schultz has bought nothing since he became CEO again. Not exactly a sign of great conviction.

      Sorry for my rather incoherent rambling. I would like to buy SBUX but I guess the best is to just stand-by for now, as you say.
      Aug 06 10:09 AM
    • Akamai: Broadband Consumption Clouds Outlook [view article]
      There is only so much you can do/"consume" when you're on the Internet. Useage even with the "broadest band" will level off eventually in more mature markets. You are not going to watch 3 streaming videos on demand simultaneously even if you could... Maybe the big goldrush is over for AKAM? Jul 31 10:46 AM
    • On Ben Graham, Bank Stocks, Jason Zweig and Tom Brown [view article]
      While the original article by Zweig and this rebuttal makes a good read, it is speculation only and the impossible attempt to read the mind of a guy who died quite a few years ago. The practical relevance of these articles are therefore naught. Nobody except Graham himself would know what he was doing today. Jul 30 06:34 AM
    • Financials: How - And When - We Reached the Bottom [view article]
      Charlie Stromeyer Jr, you asked: Do you agree with some analyst whose name I don't remember who said that in terms of business recovering that first the trust banks will recover then the commercial banks and then last the investment banks?

      I would agree trust banks recovering first appears very likely. I doubt they are at risk at all. Sure their base for earning their fees will get smaller, but essentially they do not take own risks, only handle other parties investments/portfolio. I think State Street Boston is a good example of such a bank.

      If commercial banks will recover more quickly than a Merrill or Lehman? I would not want to wager a bet on either side. I'd say it's very much a case by case affair. Certainly Merrill and others like Bears (gone) and Lehman (almost), Drexel (gone), Salomon (gone), Kidder (gone), Barings (gone) have the rare talent to blow themselves up every couple of years with one new financial trick/fad or another. The only one smarter than the rest appears to be Goldman, but the final verdict is not out yet on GS. As a group the investment bankers appear to have virtually no risk management in place and are a greedy bunch altogether without much interest other than enriching themselves as quickly as possible. This works to their benefit as long as the particular fad in question works well (usually some 5 years), then when it's reckoning time they will go like: OK, tough luck. We didn't see that coming etc etc blah blah.... For the bigger ones (MER, LEH) they can fall back on the Fed or some other friendly Wall Street arrangement (Chase buying JP Morgan and now Bears, Citi swallowing Salomon). The others are gone, with a more or less golden parachute. Rinse and repeat.

      All in all I'd say commercial banks operate more conservatively than the investment banks do. BUT their "conservativism&q... can be very reckless too, as can be seen now with Wachovia and UBS, among others.

      What I find interesting is that even community banks and small regional banks and S&L's have subscribed to this lastest round of real estate bust. The principle of "knowing your customer" has been neglected wholeheartedly almost universally at all institutions small or large. Greed, once again, got the better of bank managements all over U.S. but not only in the U.S. I live in Switzerland and are the proud producers of one of the ugliest cases, UBS...       Jul 29 09:45 AM
    • Financials: How - And When - We Reached the Bottom [view article]
      I believe 07/15 may indeed have been a bottom for the banks, but going out and buying with both hands is very risky still, if not foolhardy. 07/15 may not be THE bottom yet for banks. If there is prolonged economic downturn and recession because of the weak american consumer, it is inevitable that more - a lot more - writedowns await us in the future.

      How much has been written down so far and how much is being discounted in the current depressed stock prices of banks? Well, a good chunk for sure. But today we only know so much. Even the best informed and well-intentioned insider may not know the full extent of mess that is still waiting for us out there.

      On the other hand there will always be commercial banks around and in business in the US and elsewhere, of course. So it is a no-brainer to make a case for buying them - now or later.

      Even assuming Tom is right in calling a bottom here, picking First Horizon as an investment candidate I find rather disturbing. There are certainly better alternatives available, like JPM, BAC and WFC. Sure these are rather dull ideas, but you can be certain that these will survive. A racy pick like First Horizon may very well get you in trouble still. I'd rather play it as safe as possible right now, and that means the biggest are the most likely to come through.       Jul 23 08:07 AM
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