InvestorCP

Time to Buy China, Copper, the Canadian Dollar and Oil

The Canadian dollar is linked to oil and commodities (metals mostly); it will go up and down in conjunction with them. I used to be big on China until I read "The World is Curved", and it changed my perspective completely. They are the next crash waiting to happen, demographic shift that is almost as severe as Japan's, gobbling dollar based assets to support their currency peg, finacial policies based on keeping the communists in power. The China story will unravel without a transition to democracy - let's just hope it waits a few years. The oil and metal hard assets are being gobbled up by China, if they implode, the commodities and Canadian dollar go with it.

Hedge Funds: The Shakeout Is in Progress

The model of leverage to generate returns will take a serious hit, and I wonder whether those who have only leveraged based funds can de-leverage and still produce returns. All hedge funds are not leverage based of course, and perhaps a refocus to the absolute return goal will lead to more long and value orientation in the products.

Bear Markets Uncover Value

I think it would be helpful to define "value" here, since one person's diamond it another's lump of coal. The objective IMO is to achieve return in excess of economic value, which over the long term is theorically not possible in an efficient market. So if we are only looking at short-term mispriced securities, what does "value" mean?

Massive Government Intervention Has Bulls Cheering

Funny how some are free market capitalists....until something gets in trouble, and now they cheer government bailouts.

Apple: Great Company with Lofty Valuation - Due for Pullback

I have owned Apple since 08/2003, and I could not agree with guliamo more. It is a brand, but all brands do wear thin if they do not continue to keep pace with change. Starbucks is a prime example, and MacDonalds is another that recovered from its failures. Coca-Cola is still mired in its legacy image. I do not think Apple is comparable to any of those, but there is a saturation point to be aware of. Calling it is fruitless - I doubt anyone will get it until after it happens.

Transocean: Drilling Deep for Profits

The exploration and drilling companies (oil services generally) are the areas that are more insulated from the oil price fluctuations than the producers and integrated operations.

I like RIG and DO, as well as FTO,NFX, and CAM. There would have to be a substantial shift to alternative energy sources on the horizon to get to $60 per barrel. That would almost equate to a collapse in the price considering where we have been - unlikely.

Interview with Jim Rogers, Part I: Bigger Financial Shocks Loom

I have read a couple of Rogers books, and he comes across much better in that vehicle than in interviews. I did follow some of his advice on the commodity side (gold, oil, corn) and made some money despite being skeptical of a "20 year commodity boom" as he called it. Outside of specific commodity calls, most of Rogers advice is of little value IMO. He is always bearish and gets too many facts wrong, perhaps on purpose for his own objectives.

Credit issuance is risk related, and if everyone is risk averse because they lack confidence in economic fundamentals, then its a spiral for a while. The current cycle may last several years, but "not in our lifetime" is just an attempt at headline grabbing.

I think the commodity costs have forced a shift in demand and trade that has yet to be played out, with more regional trade and manufacturing due to oil costs. If inflation is tempered back to a 2-2.5 annual pct range, then I think the spiral will "bottom".

KHD Humboldt Wedag: An Undervalued Winner

I am also long on this stock. I have focused on it for organic growth reasons specifically targeting the eastern european developing economies. Its a speculative buy to a great degree, but its currently has a nice margin of safety on the cash and probability of growth falling to levels that do not justify a better multiple is low. I do share the same concerns around overbuilding in emerging economies, and the management personalities involved here. Its a risk I have decided to accept given the potential of the target markets and KHD position within.