captmike

Cramer's Stop Trading! Cheer up, Obama (9/14/09)

On what calendar was Monday 9/13?

Let Bernanke Do the Talking

The problem is that the new kids (Obama, Geithner, Orszag) are a bunch of arrogant punks. They're convinced that they're the best and brightest to have ever set foot in Washington because their college professors said so. They have nothing but contempt for anyone with any real experience in handling a crisis.

On the positive side, Buffett's (BRK.A) happy with big investments in GE (GE) and Goldman Sachs (GS), saying the subsequent drop in market value could help him boost Berkshire's stake. "Whether we're talking about socks or stocks, I like buying quality merchandise when it is marked down."

Buffet didn't buy common stock, he bought a preferred stake that pays him $300 million dollars a year. They're not callable by GE for a minimum of 3 years, and after that point they can only be called for a 10% premium to purchase price, or $300 million dollars. Since it's very likely that GE will do exactly that, that's $1.2 billion dollars in 3 years, plus his $3 billion back. As part of the deal he also received warrants that would allow him to purchase, but doesnt require him to, $3 billion of common stock at $22.25 within the next five years. Those warrants are currently under water, but 5 years is a long time.

If only I could get such a lousy deal.

Is a Car Produced in Alabama Really an Import?

Profits?! GMpensioner, this is the car industry we're talking about.

Who Wants to Buy an Ailing Car Company?

"Buy only American" when talking about the automobile industry is absolute nonsense. Buying Ford, GM or Chrysler doesn't guarantee that the parts originated in the US or that the car was assembled in the US. It's a strawman argument to justify bailing out the UAW at the expense of non-union US autoworkers.

Kuwait's Desperate Attempt to Save Its Reputation

I think under 5 for DOW is probably about 3 Geithner "my dog ate my homework" speeches away.


On Feb 10 10:22 PM Ricard wrote:

> I guess I am lucky...I only began to notice DOW a couple of weeks
> ago.
>
> Sold 7.50 2-year LEAPs for a 30% return. I don't see DOW selling
> for below 5.00, even with Liveris on the board - that would be a
> 90% drop from 5-year average levels. Even if it does, more than likely
> it will pull out of that situation within two years. It's still a
> great company, even without the dividend (if it gets pulled).

Stage Being Set for Hyperinflation

I love the comments that dismiss or even welcome the possibility of high inflation. We may not see hyper-inflation, but I remember the days of 12% inflation in this country. Trust me, we don't want to revisit those days.

Sell Altria During Market Hours

If I had a 50% position in MO, I'd lighten up too.

After Some Stumbles, Pfizer Is Now Being Very Smart

Murphy's on the phone and would like to talk to you about those good chances that will finally let Pfizer shares appreciate.

I'm long Pfizer too, but I'm not optimistic that all the negatives associated with this deal are actually positives in disguise.

As for committing your entire balance sheet to a mega-aquisition in this economic climate, dividend or ratings be damned, just look to Dow to find out if that's a good idea.

A Small Cap Alternative to Leveraged ETFs

Very good comments about the potential pitfalls of leveraged funds aslong-term investments.

Don't forget that these funds pay distributions over the course of the year, diluting capital and hitting the owner with a potential tax liability as well.

When investing, it really helps to understand exactly what you're investing in.

'Yes We Can!' (As Long As We're Prepared)

I beleive a better strategy would be to buy SSO when the market gets oversold as much of the downsize risk is priced in. The S&P is trading in a range with a tradeable bottom, but you won't loss your shirt if the market recovers..

5 Reasons to Ignore Buffett

When Buffet talks, you might do well to listen.

One of the previous posters said Buffet had a terrible track record since 2001. Well he called the Chinese market correctly (following Buffet in and out of PTR made me a tidy sum), he called the Euro correctly (not following him in and out was a missed opportunity for me), people claiming having cash in 3 month treasuries cost him 50% should be discounted immediately, and he nailed it on derivatives (which is the BIG one).

Here's what he said in a letter to BRK shareholders:

"...Large amounts of risk, particularly credit risk, have become concentrated in the hands of relatively few derivatives dealers, who in addition trade extensively with one another. The troubles of one could quickly infect the others. On top of that, these dealers are owed huge amounts by nondealer counterparties. Some of these counterparties, as I've mentioned, are linked in ways that could cause them to contemporaneously run into a problem because of a single event (such as the implosion of the telecom industry or the precipitous decline in the value of merchant power projects). Linkage, when it suddenly surfaces, can trigger serious systemic problems."

Mind you, he said this in 2003, not a couple of months ago. He received countless grief for this, and was even accused of being a hypocrite because he had used derivatives to his advantage previously. Well he's still fabulously wealthy and for many who were also wealthy at the time, but didn't heed his warning, they are no longer wealthy.

If Buffet says now is the time to start investing in certain US equities, you might want to pay attention. His record speaks for itself. He didn't amase in is lifetime an amount of wealth comparable to a "second tier economy" because he's misguided, a BS artist, or just plain lucky, so I'd suggest you leave the Buffet bashing to the less informed.

Why Gold Will Rocket

From what I can tell looking at your articles going back 6-12 months, every prediction you have made (with the exception of the decrease in the price of oil) has been wrong. Talk about a proven track record!

SiRF: Undervalued or Value Trap?

Now is the time to invest in strong and sound companies, with strong balance sheets. These are the companies that have been beaten down badly and their upside potential is great because they're true values. This definitely doesn't describe SIRF. SIRF is for money that you can risk a complete loss of. With that sort of risk and limited upside even in best case scenario, there are better opportunities available.

Closed-End Funds: Understand What You're Buying

It's also worth noting that many closed end funds are thinly traded, causing larger price volatility when large holders liquidate. This will smooth out in the long run of course, but will cause the short term investor real concern.