Gold slides 1.1% amidst the World Gold Council reporting an 11% Y/Y decline in Q3 demand to 1.1K metric tons. Central banks remained steady buyers, but investment demand - ETPs, bars, coins - was off 16% Y/Y. The WGC notes 2011 Q3 is a tough comparison, and demand remains well above the 5-year average of 984.7 metric tons. [View news story]
Apparently the Fed has announced a QE++ plan and then fallen short on the implementation. We simply should not be seeing this much market weakness if new money was flooding in from their interventions. Today practically everything is down, including the dollar. This tells me we are experiencing deflation, which in turn tells me that the Fed is not doing its job as per its last announcement. I just pulled the plug on the last of my investments. If I do anything for the rest of the year, it will be to take short positions.
Gold slides 1.1% amidst the World Gold Council reporting an 11% Y/Y decline in Q3 demand to 1.1K metric tons. Central banks remained steady buyers, but investment demand - ETPs, bars, coins - was off 16% Y/Y. The WGC notes 2011 Q3 is a tough comparison, and demand remains well above the 5-year average of 984.7 metric tons. [View news story]
Divinecomedy, you make no sense. Stop drinking that "cold medicine" before you grace us with your comments.
Intel: The No-Nonsense Reason It's Down [View article]
Mediumterm seems to be the one with the myopia. Isn't what you said exactly what Ashraf said? So why should he eat humble pie ,and why do you accuse him of myopia?
Personally, I am of the humble opinion that instruction set is important, and ARM has already won the war in the cell phone market. If Intel wants to compete at the commodity end of the market it's going to need an ARM chip.
Intel: The No-Nonsense Reason It's Down [View article]
In what way does a stock buyback unfairly help senior managers and ex-shareholders? As a shareholder of a growth stock, I want to see the stock price appreciate in value. Dividends are a somewhat annoying plus in that they benefit my stock broker who gets another commission when I reinvest and my government who taxes dividends higher than capital appreciation. I don't see any combination of salary, stock and options that unfairly benefit management in this equation. You too, can purchase options if you are feeling jealous of option holders.
Algae Fuel For Regular Diesel Prices? Solazyme Makes It Happen [View article]
While it's nice to know that we've got another alternative to petroleum in the works, it doesn't look like now is a good time to buy. Nobody likes to try to catch a falling knife.
Bambooman, I agree with your analysis and would add that a large part of Apple margins come at the cost of its suppliers. This is not a good business strategy for the long term. Eventually Chinese producers will figure out that they need to raise their bids in order to make a profit on Apple jobs. So add that as a large cost that will increase in future years.
Also, labor costs in developing countries are not stable. As workers become more educated in western economics, and as job availability increases, the workers demand more pay. I remember when I was working for a software company that was outsourcing part of its workforce to India. That area of India was seeing a rapid rise in job availability. We started to see a big employee retention problem right away. Often a new hire would simply fail to show up for work as they had gotten a better job offer between the time they accepted our offer and the first day of work.
Inside GLD: Q&A With Tim Coyne Of State Street [View article]
So the short answer is that when presented with the question of the difference in expense ratios versus (IAU), they obfuscate and reply by raising other issues, issues which are of possible importance only to large institutional investors. For small investors, IAU is clearly the better choice.
On the question of the gold being in the vaults, I don't think there's any reason to believe that there are too few bars in the allocated account. Such an obvious shortfall would be too easy to detect during an audit. The real question is one that a physical inventory can't answer. Are any of those bars in any way hypothecated by the custodian? The custodian is, after all, a bank, and banks lend based upon the assets under their control. In fact, through fractional reserve lending banks lend many times as much as the assets under their control and use those reserve assets to cover any liquidity requirements implied by those loans.
One final question is what is being done about counterfeit bars. We know that gold-plated titanium bars have made it into the bullion bank vaults. This is not too surprising since the custodian relies on the assay report provided by the bar's producer in the normal case. When a titanium bar is discovered, what are the procedures? Are other bars from that producer checked? Are other bars entered into storage with that bar checked? Are any bars ever checked at random?
Actually, I had a high-end HP all-in-one printer. I worked with HP customer service for nearly a month to resolve the software issues with the advanced features of the device before I gave up and exchanged it for a more bare bones model. So I know they do have customer service. But customer service can't fix profoundly broken software that never should have been shipped in the first place. HP has no quality control to speak of. They probably have such a department, but it is entirely impotent.
My printer was just one example I observed. I also worked as a software developer on a product that supported the HP Unix (HPUX) operating system as well as 2 other Unix brands. HPUX always had the most bugs that had to be worked around. It was the least popular brand of Unix and gave us the most problems. If it were not for one particular customer that insisted on it being supported, we would surely have dropped support for it.
Even when HP software works more or less as intended, it is bloated junk that hogs the machine and is overly difficult to install because HP insists on providing their own installation procedures instead of using the approved vendor install procedure. In short, HP management shows themselves incapable of successfully managing a software project.
What's Driving The Market And Where Do We Go From Here? [View article]
It seemed to me that the market should have had a dramatic fall earlier in the year. Instead we got an on-again off-again, funky market that declined some months and rose other months, depending mostly on whether the dollar or the euro was winning the race to worthlessness. In the end, of course, we know that both are just paper and are equally worth exactly as much as the politicians who control them. My question is did the Plunge Protection Team prevent the expected dramatic fall, and if so, does it have sufficient power to continue to prevent it?
With U.S. Expected To Be Largest Oil Producer By 2017, Is It Time To Buy Energy Stocks? [View article]
If we've really got as much oil and NG coming online as the IEA says we do, then it's best to stay with (SPY) instead of switching to (XLE). The producers are already having a hard time keeping the glut of NG from pricing itself below the cost to produce. If domestic oil gets to be as abundant then you want to be on the buying side (SPY), not the producing side (XLE).
General Mills: The Technically Risk-Free Stock? [View article]
Canuck1, you are confusing a beta of 1 with a beta of 0. Beta = 1 means the stock has a 1:1 exposure to the systemic risk. Beta = 0 means the stock has negligible exposure to the systemic risk. Beta expresses no opinion about risks other than the systemic risk. In other words, there are certain risks associated with the S&P 500 (the usual benchmark for computing beta). (GIS) with a beta at or very near 0 is supposedly insulated from those risks. However, there might be other risks that affect GIS that the S&P 500 is immune to.
In particular, GIS might logically have exposure to grains and sugar commodity prices which would have negligible effect on the S&P 500.
How can GIS be immune to the usual market forces that affect nearly all S&P 500 stocks? GIS is a major beneficiary of the food stamps program. People don't stop buying Cheerios when they lose their job. They get food stamps and keep right on eating their favorite sugary breakfast cereals.
American Eagle Has Dropped For All The Wrong Reasons [View article]
In truth, (AEO) is unlikely to maintain 40% growth in the coming quarters simply because 40% is an unrealistically high bar and the economy is going to provide a strong headwind. Apple, too, has been significantly discounted because it is unlikely to maintain its same pace going forward, no matter how much young people want to be seen holding Apple iPhones and wearing AE clothing. In my neighborhood everybody wears Hollister anyway because of their surfing theme.
No matter how irresponsible US politicians and bankers get, it seems that they can't hold a candle to those in Europe. Euro holders have been bidding up the dollar all year, and it looks like they will do it again next year too. Gold may well rise in spite of that headwind, but a strong dollar is bearish in the short term for gold.
I'm not that convinced that the fiscal cliff will be all that bullish for gold. It will definitely send stocks lower, and investors this year have been treating gold more like a "risk on" investment than a "risk off" one. Gold may fall in sympathy with stocks, or simply stay put as the two forces (the "inflation haven" versus the "risk on") conflict with each other.
Protected Principal Retirement Strategy: Royalty Trusts Redux [View article]
The oil industry never goes too long without a crisis. (I seem to remember at least one each spring and fall that causes the price of gas at the pump to rise.) There ought to be plenty of opportunities to sell oil at their $100 target price in the future. And 3% is less than the real rate of inflation, so I think those projections are actually rather conservative. Looking at the price ratio of gold to oil, it doesn't seem to me that we've seen any effects from peak oil yet.
I do worry a bit that production is being pulled forward from the projections because I know these wells are shallow and have relatively short lifetimes as it is. If I recall, the projection calls for production to begin it's decline almost immediately after the last well is drilled. But right now the stock is acting like the last well was already drilled six months ago.
Gold slides 1.1% amidst the World Gold Council reporting an 11% Y/Y decline in Q3 demand to 1.1K metric tons. Central banks remained steady buyers, but investment demand - ETPs, bars, coins - was off 16% Y/Y. The WGC notes 2011 Q3 is a tough comparison, and demand remains well above the 5-year average of 984.7 metric tons. [View news story]
Gold slides 1.1% amidst the World Gold Council reporting an 11% Y/Y decline in Q3 demand to 1.1K metric tons. Central banks remained steady buyers, but investment demand - ETPs, bars, coins - was off 16% Y/Y. The WGC notes 2011 Q3 is a tough comparison, and demand remains well above the 5-year average of 984.7 metric tons. [View news story]
Intel: The No-Nonsense Reason It's Down [View article]
Personally, I am of the humble opinion that instruction set is important, and ARM has already won the war in the cell phone market. If Intel wants to compete at the commodity end of the market it's going to need an ARM chip.
Intel: The No-Nonsense Reason It's Down [View article]
Algae Fuel For Regular Diesel Prices? Solazyme Makes It Happen [View article]
Just Sell Apple If You Are Nervous [View article]
Also, labor costs in developing countries are not stable. As workers become more educated in western economics, and as job availability increases, the workers demand more pay. I remember when I was working for a software company that was outsourcing part of its workforce to India. That area of India was seeing a rapid rise in job availability. We started to see a big employee retention problem right away. Often a new hire would simply fail to show up for work as they had gotten a better job offer between the time they accepted our offer and the first day of work.
Just Sell Apple If You Are Nervous [View article]
Inside GLD: Q&A With Tim Coyne Of State Street [View article]
On the question of the gold being in the vaults, I don't think there's any reason to believe that there are too few bars in the allocated account. Such an obvious shortfall would be too easy to detect during an audit. The real question is one that a physical inventory can't answer. Are any of those bars in any way hypothecated by the custodian? The custodian is, after all, a bank, and banks lend based upon the assets under their control. In fact, through fractional reserve lending banks lend many times as much as the assets under their control and use those reserve assets to cover any liquidity requirements implied by those loans.
One final question is what is being done about counterfeit bars. We know that gold-plated titanium bars have made it into the bullion bank vaults. This is not too surprising since the custodian relies on the assay report provided by the bar's producer in the normal case. When a titanium bar is discovered, what are the procedures? Are other bars from that producer checked? Are other bars entered into storage with that bar checked? Are any bars ever checked at random?
HP's Next Chance: High-End Tablets [View article]
My printer was just one example I observed. I also worked as a software developer on a product that supported the HP Unix (HPUX) operating system as well as 2 other Unix brands. HPUX always had the most bugs that had to be worked around. It was the least popular brand of Unix and gave us the most problems. If it were not for one particular customer that insisted on it being supported, we would surely have dropped support for it.
Even when HP software works more or less as intended, it is bloated junk that hogs the machine and is overly difficult to install because HP insists on providing their own installation procedures instead of using the approved vendor install procedure. In short, HP management shows themselves incapable of successfully managing a software project.
What's Driving The Market And Where Do We Go From Here? [View article]
With U.S. Expected To Be Largest Oil Producer By 2017, Is It Time To Buy Energy Stocks? [View article]
General Mills: The Technically Risk-Free Stock? [View article]
In particular, GIS might logically have exposure to grains and sugar commodity prices which would have negligible effect on the S&P 500.
How can GIS be immune to the usual market forces that affect nearly all S&P 500 stocks? GIS is a major beneficiary of the food stamps program. People don't stop buying Cheerios when they lose their job. They get food stamps and keep right on eating their favorite sugary breakfast cereals.
American Eagle Has Dropped For All The Wrong Reasons [View article]
Is It Time To Buy Gold Again? [View article]
I'm not that convinced that the fiscal cliff will be all that bullish for gold. It will definitely send stocks lower, and investors this year have been treating gold more like a "risk on" investment than a "risk off" one. Gold may fall in sympathy with stocks, or simply stay put as the two forces (the "inflation haven" versus the "risk on") conflict with each other.
Protected Principal Retirement Strategy: Royalty Trusts Redux [View article]
I do worry a bit that production is being pulled forward from the projections because I know these wells are shallow and have relatively short lifetimes as it is. If I recall, the projection calls for production to begin it's decline almost immediately after the last well is drilled. But right now the stock is acting like the last well was already drilled six months ago.