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  • Buying USO Is a No-Brainer [View article]
    Considering the abrupt change in world oil demand, this steep price change is logical. Bullish speculators owned the market earlier this year because supply and demand were about equal if not a little under supplied. Any threat of supply disruption gave oil prices over to bullish speculators. Now with demand dropping, and oil producers so accustomed to the larger revenue streams, there will be a reluctance to cut from many. Most of the actual supply cut that will surface will be from the wealthier oil producers with relatively stable governments---Saudi Arabia, Kuwait, UAE. Many of the revenue-dependent countries will cut little, if at all. They will pledge to cut then sell it out the backdoor. Nevertheless, I do agree that USO is getting closer to a clear buying range
    Dec 27 10:12 AM | 1 Like Like |Link to Comment
  • The Real Rationale Behind Current Supply and Demand for Oil and Other Commodities [View article]
    While the world economy was running on all twelve cylinders, ready and available oil was just about, or even a little under world demand. This made for an environment where any news about disruption of supply such as rebels attacking a pipeline in Nigeria, or an oil terminal fire in Saudi Arabia would cause a shock in prices at the commodity exchange. This all had a very bullish bias in pricing. Oil speculation had the effect of pushing prices up to what I would call a reasonably worse case scenario in supply. That means only a minor cutoff in supply where demand is already quite high can result in incredibly inflated prices. We are now experiencing the reversal. With world demand considerably lower and full tankers playing storage, we're awash in oil. OPEC will not see $75 anytime soon. They don't have the ability to cut as much as they need. Only a few countries can afford to cut---Saudi Arabia, Kuwait, perhaps UAE. The remaining countries will promise to cut but will not. This is their history. They're are liars and cheats and nothing will change. The world economy is the only thing between them and $75 oil.
    Dec 27 08:51 AM | Likes Like |Link to Comment
  • Cramer's Lightning Round - The Most Dangerous Stock for 2009 (12/23/08) [View article]
    The most dangerous stock for 2009 is an index of Cramer favorites. We need an ultrashort Cramer portfolio.
    As for his call on Baidu.com, I think Chinese regulation isn't as much an issue to the Chinese people. It will not slow down the growth of the Internet or curtail Baidu's future profitability. The Chinese people are resilient. They have always introduced work-arounds. They've been dealing with this lot for 60 years and know their way around. To them, these are minor glitches.
    Dec 27 08:31 AM | Likes Like |Link to Comment
  • The Free-Markets Myth [View article]
    On the other hand, if markets had been truly free, Fannie Mae and Freddie Mac wouldn't have received the change up pitch from the mortgage companies. Banks would have had little alternative but to hold more debt which would surely have been better scrutinized. A truly free market wouldn't have had a Federal Reserve tinkering with rates in the first place. The market would set the rate. We wouldn't be watching endless banking committee hearings from Congress. We really have what can only be called a quasi-free market.
    Dec 27 08:21 AM | 1 Like Like |Link to Comment
  • Was Subprime Lending Just as Dishonest as Madoff? [View article]
    I think drawing a comparison of Madoff's ponzi scheme fraud to the sale of subprime mortgages is akin to comparing a grand theft auto to a higher than average auto repair bill. I mean, enough with painting subprime as actual fraud. For far too many it was a matter of not wanting to be left out of what was a raging bull market in real estate. These companies lowered standards much as Congress desired, and the flood of first time and overleveraged buyers came running through the doors. Many believed the worse case was when they were ratcheted up they could always sell their home into that fantastic real estate market and make a nice tidy profit. No downside.
    For those that read this as a case of moral hazard on the part of the mortgage companies that knew they were going to sell the loan anyway, I would agree. But that moral hazard should have been offset by some notion of risk on the part of the investment banks and hedge funds that bathed in mortgage backed debt. They were so smart they thought they had outwitted the system with credit default swaps covering their butts. But it was all just pride before the fall.
    Dec 26 12:57 PM | 3 Likes Like |Link to Comment
  • Coach: Luxury on the Cheap [View article]
    I'd have to agree with ChipSeal. Cosmetics? We'd probably see a bigger cut in food, electricity, and water before cosmetics.
    Dec 26 12:11 PM | Likes Like |Link to Comment
  • Credit Crisis Watch: Signs of Progress? [View article]
    I can see quite a bit of impatience among some posters who don't understand why banks who have received government funding aren't lending out these dollars.
    We are still in a state of de-leveraging of bank portfolios. It would be suicidal for some to lend out that which is saving their hide. It wouldn't serve any purpose for anyone if they lent it out only to be back in trouble with ratings agencies for their increased leverage. As for those who believe it would have been better to allow them to fail, I disagree. The world's largest bankers have foolishly tied millstones around their own necks and handcuffed themselves to one another. If you think this world recession is looking pretty bleak now, maybe we should replay this scenario and allow the dominoes to fall as they will. Lets then imagine a world economy with little or no leverage at all. Nearly all business would be negatively affected for a long, long time. Every homeowner would see their home values drop significantly with little ready market of cash only buyers. This isn't rocket science.
    Dec 25 05:30 PM | 1 Like Like |Link to Comment
  • How to Inspire More Panic in the Economic Crisis [View article]
    Miguel Ordonez is once again proving the old adage, If my neighbor loses his job its a recession, if I lose my job, its a depression.
    Dec 25 04:36 PM | Likes Like |Link to Comment
  • Does China Truly Offer an Alternate Economic Model? [View article]
    First of all most of any corruption news in China isn't reported in China but in the U.S.
    Second, its incredible naivete to believe that the U.S. system is so transparent that what is reported here is anything more than a snowflake on an iceberg? Corruption comes in many forms whether its cronyism, cheating on taxes, cheating on billing, making phony expense reports, or out and out bribery, and that's just the political system. Of course, it exists though out our economy.
    I am still utterly amazed how easy it is to buy a U.S. election by anyone or any country that has an interest. If he desired, Osama Bin Laden could have easily bought 250,000 Visa or Mastercard Cash cards at $200 a whack, hired and trained a team of computer data input Jihadists to donate $200--- 250,0000 times to the candidate of their choice under every name in the New York telephone book. That's $50,000,000, but go pick your figure. The world will provide an infinite amount of help.

    As to campaign money used for campaign purposes and not self? So, I guess we can expect no preferential treatment for any family or relatives through advice, positions, or anything else? What was it Hugh Rodham made as a plaintiff tobacco attorney even though he had never before been involved in civil law? What did Hillary turn $100 into in the futures markets? $100,000? How did the Clintons get out of that losing Whitewater investment without a loss? And this is only what we know. Not to pick on the Clintons anymore than anyone else, they're just more blatant like Bloggy.


    On Dec 24 10:18 AM sorno wrote:

    > Have you seen any corruption news in china? The amount of money is
    > far more than US. The money raised from the campaign is used for
    > the campaign, not much for personal use, that's a difference. In
    > US, people corrupted to get more money for themselves, in china,
    > people corrupted to get money for themselves and for their whole
    > family of successors, that's another difference. Base on your opinion,
    > which country has the best system now?
    Dec 24 03:08 PM | 1 Like Like |Link to Comment
  • Peter Schiff: Outlook for the Gold Market [View article]



    On Dec 23 04:42 AM Commodity bubble proponent wrote:

    > Anyone who buys Schiff's arguments is a moron for a couple of reasons:
    >
    >
    > 1. The deflationary forces from the current de-leveraging are far
    > larger than the quantative easing that the Fed can do. In the last
    > year, we've lost nearly 20 trillion in global equity valuations,
    > not counting the several trillion in global real estate assets, corporate
    > bonds, municipal bonds, etc etc etc. The fed even on its best days
    > may be able to only inject 2-3 trillion/yr into the system. what
    > they are doing is basically trying to fill a bathtub with a squirt
    > gun.

    The whole idea that the Fed isn't dumping enough into the system is very dismissive of the capacity of the U.S. economy to affect a bottoming of deflationary forces once Fed induced liquidity meets up with a high enough level of writedowns which will only lead to opportunity for savvy risktakers which we have never lacked over an extended period of time. This is nothing more than a real estate bubble. A large real estate bubble that needs to be deflated.


    > 3. There is no replacement currency for the dollar. The ECB has proven
    > that they are ass backwards in their thinking, the Japanese are still
    > having problems with deflation, the Chinese are corrupt as hell and
    > their banks are burdened with trillions of dollars of non-performing
    > loans from the communist days, and we've all seen what's happened
    > to Russia lately.

    As much as it pains me to say it, the Chinese may not have any more corruption in their system than America, and I'm not talking about politics.
    We aren't nearly as transparent as many would have you believe. As for Chinese bank debt, your estimates are wildly exaggerated. Their banks had about 1.3 Trillion in 2001. Check it out, things have changed.

    > 4. The Chinese consumer is not powerful enough to rescue the world
    > economy. The average Chinese person earns roughly $2,100/yr and the
    > average American earns $50,000. This means that the Chinese guy must
    > increase his marginal income nearly 24x to hit the same level that
    > the American guy is at. In order to get there, either that guy needs
    > to earn 24x as much or the dollar needs to depreciate 97-99%. None
    > of those things are likely to happen.
    Actually, I would say the Chinese mode might be $2100/yr or thereabouts, but they do have an upper class that has been growing tremendously. While it may be a relatively small percent of the overall population, its still sizeable even compared to the U.S. Nevertheless, I'm not confident they are ready to run demand in the world.

    > 5. COMMODITIES were all a bubble and are not likely to reflate anytime
    > soon. I'd expect this to happen only when all of the commodity bulls
    > give up and go play somewhere else (which given the current CNBC
    > offerings of advice will be a while).

    Commodities are going through the same bear market as the stock market. They will rally then plunge much as the stock market. Likely, we will see re-inflation in this sector as soon as we anticipate the bottom is in on real estate and the economy overall.
    Dec 24 02:33 PM | 2 Likes Like |Link to Comment
  • Don't Be Scammed by Madoff Investor Sob Stories [View article]
    TomF75:

    I watched an interview with Arthur Levitt the long running SEC chairman under Clinton. It was asked of him about the SEC response under Cox but also under himself because the call for investigation of Madoff went back to the mid 1990's. He said regulators will always react after the fact. Its because they are set up and manned to regulate. Investigation only comes after its exposed. Unfortunately, they aren't the ones that expose it. This is a judge of the attorney general of the state of New York. That is their domain. Neither Guiliani nor Spitzer did any investigation of the Madoff scheme.


    On Dec 22 04:42 PM TomF75 wrote:

    Dec 22 06:30 PM | 1 Like Like |Link to Comment
  • 'Fair-Value' Accounting Isn't Fair [View article]
    I can't agree more. I agree with the concept of fair-value accounting but realize that it is a far too crude system when faced with temporary liquidity issues. Should companies be forced to write down assets and suffer the body blow of a credit agency downgrade that results forcing a company to raise capital through the markets or selling assets into an illiquid market to save their rating? This is nuts! I can't believe we haven't yet amended fair value accounting to address this problem. This isn't about sweeping it under the rug, nor should a fix enable that to occur. There has to be an existent stipulation that should market liquidity dissipate to a predetermined level, that a secondary option of value using cash flow to maturity analysis but with an eye on ratings would be available.
    Imagine if mortgage holders had the right to call back a loan if their equity dropped to a predetermined level, much as margin works in the stock market. In today's real estate market, a lot of people would be getting margin calls. Now they either need to bring more capital to the table or sell their home in the current market, without any consideration given to whether you're paying your mortgage on time. How crazy is that? How may more homes would go into foreclosure? What's the benefit here?
    Dec 22 02:14 PM | 3 Likes Like |Link to Comment
  • California's Labor Market in Trouble as Unemployment Rate Soars [View article]
    California voters are getting their just deserved reward for stupidity at the polling place. Our legislature and state senate is made up of some of the most brain dead economic illiterates this nation has ever seen in a legislative body. They are absolutely convinced that even though we rank close to the top of states with high taxes that the solution can only be.......higher taxes. That has to be the answer. Hasn't it always been the answer before? Of course, we'll attract many new businesses to California if we will only raise taxes higher. We have the third largest state in square miles and pay the second highest gasoline taxes in the country. So, let's raise it exponentially higher so that people have to pay much more to commute to work. Additionally, we will benefit with the increase in prices for all goods that need to be transported from and by the state highways. Let's also raise that low 8.25% state sales tax to 9.75%. That will teach those materialist voters a thing about conservation.
    Cut programs? What are you kidding? We're currently working on how we can make up for lost automatic markups in future years. Voters? Hey, we educate those stupid turds. We can tell them anything and they'll believe it.
    Dec 22 01:53 PM | 1 Like Like |Link to Comment
  • Don't Be Scammed by Madoff Investor Sob Stories [View article]

    On Dec 21 05:31 PM You are clueless wrote:

    > Where is the SEC? We pay taxes for Government services
    > to regulate and help the American people. Clearly it did not work!!

    How many of you get audited every year? How about in the last 15 years. My guess is very few have ever had an audit. IRS looks for red flags, but without that they only audit a small percent of all taxpayers every year. Seems crazy considering the wealth of revenue that would be produced both by recouping monies denied and also by scaring more taxpayers into being more honest. The fact is the federal government can't support all the auditors it might take even if it means more revenue.
    So how can we expect the government could ever regulate our way to a future protection us from a ponzi scheme. Criminals will always circumvent the system. This is all about buyer or investor beware. These investors, many of them professional, did not do any due diligence. They rested in the assurance that Madoff had been around a long time and was practically seen as an institution. That's their due diligence. I'm not saying we don't need regulation. We need smart regulation, but their has never been a criminal who couldn't separate a sucker from his money.
    Dec 22 01:36 PM | 1 Like Like |Link to Comment
  • $35 Oil: Steve Forbes Was Off by Two Years [View article]
    This sure seems like a good time to top off our strategic petroleum reserve. Somehow, I don't think it will happen in the next 4 years no matter the price.
    Dec 21 04:44 AM | Likes Like |Link to Comment
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