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  • Ugly Numbers [View article]
    "FED switches gears to Wimpy-nomics"

    I will gladly owe you Tuesday for a fiscal stimulus today.
    Nov 4, 2008. 02:07 PM | Likes Like |Link to Comment
  • It's a Great Time to Be an Inflationista [View article]
    You could go big time under your real name and then throw peanuts at yourself" - moonbat

    How do you think I got all those +1s? Hehehe.
    Nov 4, 2008. 01:59 PM | Likes Like |Link to Comment
  • Driven to Bankruptcy [View article]

    Good point. Same complaint does apply to overpaid executives. My only comment there is that the owners of a business should be free to overpay any of their employees if that's how they want to do business. If they overdo it they won't be able to compete and will change or fail.

    What should be forbidden is 'using' gub'mint force to provide your business an unfair competitive edge in the market, ie. tarriffs, licensing requirements, FDA approval, etc. Free competition for all and let the market decide and we'll all be much better off in the long run.

    Give libertarianism/anarchy a chance. Maybe it'd be better than what we've got, maybe not. Can't know till you try. Couldn't be much worse than what we've got now.

    Nov 4, 2008. 01:55 PM | Likes Like |Link to Comment
  • Stop Calling This a Depression [View article]

    I agree completely. Eventually inflation will return with a vengance. You can't flood the world with more paper money and not expect inflation to return.

    I just hope I can earn enough profits trading paper gold to buy a bunch more physical gold before the wheels come off in a big way.

    Looks like something is nibbling at the low gold prices today. Up around $40/oz so far.
    Nov 4, 2008. 01:42 PM | Likes Like |Link to Comment
  • Driven to Bankruptcy [View article]

    Why my brother? Familial ties with the producer might get me to buy if the prices were close, but it won't mean squat to someone from the next block over.

    If a neighborhood baker made bread to sell for $5/loaf when I could buy out of town bread for $2/loaf I'd buy from out of town. If I want to donate to the community I can take the $3 of savings and give them $2 and keep $1 myself.

    Maybe that's better for the community in total. Maybe the local baker only donates $0.75 of his time out of that extra $3 he charges me.

    Fact is that it's MY money. I can spend it any way I like regardless of what you may or may not think. Same goes for your money. I don't expect you to spend it based on what I think. Do what you want with it.

    That doesn't change the fact that an non-profitable business model can't last in a market economy. Why should the owner or employees expect to be 'given' a decent living if they can't earn it by producing something people are willing to buy at a price they are willing to pay?

    How many buggy whips did you buy last year? None? Why aren't you supporting buggy whip manufacturers? Don't they deserve to make a decent living too?
    Nov 4, 2008. 12:30 PM | 1 Like Like |Link to Comment
  • Driven to Bankruptcy [View article]
    "The gov't will have to pay for all ... (taxpayers)" - wondergirl

    The fact that our gub'mint takes and spends my income on things I would not otherwise spend it on does not make it economically viable nor something I would chose to do with my money. I have no choice as the gub'mint has made it plain that they will throw me in jail if I 'choose' not to cooperate. Extortion isn't an identifying hallmark of a free market.

    If not for unthinkable levels of debt the gub'mint would not be able to pay for all the support programs you identified. They are nothing more than gub'mint vote pandering with stolen money and hardly a good reason for continuing to support a money losing business.

    Saying the gub'mint is going to take my money and spend it anyway is not a valid reason for propping up a failing business.
    Nov 4, 2008. 12:15 PM | Likes Like |Link to Comment
  • Stop Calling This a Depression [View article]
    "Stop Calling This a Depression"

    Of course. We haven't gotten that far yet. Give it some time. shows
    1) unemployment as calculated pre-Clinton at 15%
    2) GDP growth at -3%
    3) CPI as calculated in 1990 at 13%

    Nope, not quite a depression ... yet.
    Nov 4, 2008. 11:52 AM | Likes Like |Link to Comment
  • The Economy's Worst Is Still Ahead of Us [View article]
    Let's not forget the other shoes waiting to drop:

    1) Commercial real estate
    2) Auto loans
    3) Credit card debt

    Each of these will undergo the same problems that residential real-estate is experiencing now. Expect many more Billion dollar writedowns to follow.

    "It ain't over till it's over" - Yogi Berra
    Nov 4, 2008. 11:43 AM | Likes Like |Link to Comment
  • Acute Phase of Liquidity Crisis Has Passed; Bear Market Bottom Around the Corner? [View article]
    Recent market activity looks as though the current down leg may have run out of steam. Bear market rally may commence, but it's likely we haven't seen the utlimate bottom yet.

    Short term traders may get a playable bounce here. Be ready to exit on first sign of weakness though.
    Nov 4, 2008. 11:34 AM | Likes Like |Link to Comment
  • It's a Great Time to Be an Inflationista [View article]
    Hey!! SWRichmond moves out of the peanut gallery and into the limelight.

    Good Job!

    For the first of many articles this was well written on a difficult topic. The only slight difference of opinion is as mentioned above. In the end hyperinflation is just as bad as deflation. We have passed the point of no return and one way or another it will become very painful in the future for somebody, if not everybody.

    Keep writing. moonbat, curbs, dozer, and I will keep tossing peanuts.
    Nov 4, 2008. 11:27 AM | 1 Like Like |Link to Comment
  • Driven to Bankruptcy [View article]
    With all due respect to those working in the auto industry I'd like to present the market's case.

    The market doesn't care about how much you earn. You don't have a "right" to a good paying job. If you want high pay you must produce enough to financially support that level of pay.

    If the Japanese, Indians, or Chinese can make an equivalent car for half the price (after shipping it half way around the world) then the market will buy a foreign car and use the difference in prices to put food on the table or pay the rent.

    Is that 'fair'? The market doesn't care about 'fair'. That's a moral concept which depends on whose point of view you are taking.

    Is it 'fair' to the Chinese guy who works just as hard for less money if his products are prevented from selling because the US gub'mint adds a 100% tarriff? Not to him. He's glad to have the job paying half what you make and producing as much or more for the money. He is outcompeting you.

    Is it 'fair' to the consumer who winds up paying 50% more for a car because of the tarriffs necessary for you to maintain your standard of living? Not to him. He'd rather buy the foreign car and save the money to spend on something else. He has limited resources too and wants to get as much as he can for his income. Why do you expect him to pay more for a car than he has to? To support your income? Is that 'fair'?

    The fact is it's a free market. If a Japanese car company can make an equivalent product for less, then people will buy it and US car makers will go under. Period. That's how the market works. Always has, always will.

    The money spent on US car manufacturing will instead be spent on something more productive that consumers are willing to pay for. Maybe that means lower wages for former auto workers, or maybe they will figure out how to be more productive and earn more. It's up to them to make the most of their position and opportunities without the gub'mint saving their bacon at everyone else's expense.

    Life is always and everywhere a competition in the market. There are no promises. Those who are most productive get ahead. Those who try to 'bully' their way to better incomes like the UAW has been doing for the past 30 years will find that the market eventualy undercuts them and they will find themselves looking for another line of work.

    Don't complain about the market's verdict. It's composed of people just like you looking to get the most out of what they've got. Find a way to be more productive and you will succeed by selling them the best product at the best price.

    As it stands now, the Big 3 probably all deserve to go bankrupt. They have grossly misjudged the market, gone deeply into debt, and lost market share. GM and F are both technically bankrupt already. They each have over $40/share in debt as it stands now and the only way to become productive is to borrow even more.

    When does it stop? How much money will they waste trying to support UAW members who are paid far more than foreign auto workers earn when they are no more productive than the foreigners?

    Are we becoming the bailout nation? Does everyone now have an unspoken 'right' to a gub'mint subsidy to prevent failure regardless of cost?

    That's not how the US got to the top of the heap. It won't keep us there either. Not for long.
    Nov 4, 2008. 11:02 AM | 2 Likes Like |Link to Comment
  • Will Retail Investors Continue to Buy and Hold Stocks? [View article]
    Keep in mind also that a great deal of Buffett's early days of building wealth relied on buying private companies at prices that produced good cash flow returns on the investment. Buying publicly traded stocks in any kind of volume came later when he had already built a large pile of privately held, growing, cash flow producing companies.

    This is generally not possible for the small investor (unless you buy BRK shares) as there are very few publicly traded companies paying the returns that Buffett was getting on private businesses.

    If you want to make 'buy and hold' your core strategy then you need to focus on buying companies with significant and stable dividend payments. One you have a position with a flow of income you can then concentrate on whether to add or trim your core position based on current prices.

    Without dividend income as a guide you are simply trying to time the market for price swings. Calling it something else is simply wordsmithing. You can at least be honest with yourself and admit that you're simply trying to swing trade if that's the case.
    Nov 4, 2008. 10:14 AM | 2 Likes Like |Link to Comment
  • What AIG Can Teach Us: Who Not to Trust [View article]
    "Every prudent man dealeth with knowledge: but a fool layeth open his folly." - Proverbs 13:16
    Nov 4, 2008. 10:03 AM | 1 Like Like |Link to Comment
  • Financial Crisis: Not Hitting Brokers [View article]
    I'm thinking that bonus payments should reflect the amount of money made for their clients.

    Given the recent large decline in the market, only those who were recommending moving entirely to cash or bonds should be eligible for bonus payments.

    But then again, that's not exactly the goal of Merrill Lynch is it?

    Remember that to a big brokerage firm 'sell' is a four letter word.
    Nov 4, 2008. 09:53 AM | Likes Like |Link to Comment
  • Golden Opportunities? [View article]
    If commercial open interest is declining then another upleg is about to start shortly. Maybe it won't be the onset of the "big one" but prices are very likely to move higher from here.

    If commercials are reducing their net positions it means that the current prices are too low. They will be much more likely to wait for another rally in price back to 'realistic' levels before taking any more positions on the short side for future delivery.

    The commercials aren't stupid. They close out their short positions when prices get "too low" and re-establish them when prices are "too high". It's their business to know what they're doing. When they all do the same thing, it's telling you something (or it ought to be).

    Of course pinpoint timing is another story. Commercial Open interest figures will tell you which way the big boys are leaning though. Keep your eyes open.
    Nov 3, 2008. 04:31 PM | Likes Like |Link to Comment