jepittman

U.S. Rejects Nationalization of Citi and BAC

This administration has a viable plan for dealing with this crisis. It has done an absolutely wretched job of selling it. There is a plan to get the 'bad assets' off the banks balance sheets. There is a plan to recapitalize the deserving banks with cash. There is a plan to restart securitization of commercial loans, residential mortgage loans, student loans, credit card consumer loans, with the federal reserve as the purchaser until private markets stabilize. These plans were vaguely outlined and then the spokesmen disappeared with no Q&A, no followup with details, and virtual silence while rumors of bank nationalization ran wild. Obama is a thoughtful and talented man but it appeares like he has no clue about how markets work, and the advice he is getting about communication with them leaves a lot to be desired.

Best Stocks for 2009

I wish I had a dollar for every time I've read the phrase 'the consumer is tapped out'. SOME consumers are tapped out. To imply ALL are tapped out is a stretch. There are a lot of people still in pretty good financial shape who have good jobs with rising wages who have the capacity to spend. They, like everyone else, have been bombarded with negative news to the point that they are reacting in the expected way by cutting back on their purchases. A lot of the cutback is optional due to the deluge of pessimism. I understand that in the aggregate consumer spending will decline for awhile as the labor market adjusts to the new market realities. But keep in mind the financial markets have already discounted an awful lot of this pessimism and as people settle down and realize the world isn't coming to an end, they will gradually resume their spending patterns. There is still a lot of consumer buying power out there that can bounce back pretty quickly.


On Dec 24 11:13 AM Emerald wrote:

> Generally speaking, most of the stocks listed above make a lot of
> financial sense, although Fluor and Flowserve are making bets on
> government spending. Dell is in a very competitive business and is
> trying to regain market share lost to HP. However, the consumer is
> tapped out and small business is reducing tech spending in 2009.

Where Is the (Sector) Leadership In This Rally?

It may be that it will be the commodities market that brings confidence to the other sectors. If a believable bottom develops in things such as oil, gas, gold, and copper it may say to the rest that the economy will soon at least slow its rate of descent. Once it stops getting worse the other sectors should rally.

Dell's Got a Demand Problem

One thing that Dell has dramaticly improved is their customer service. That is a huge factor that is being overlooked by many. While it is true that they have a demand problem, so does everyone else. It is in the stock already. Computers are a cyclical business in that purchases can be deferred for awhile. Computers wear out and become obsolete so the deferred demand is just that ; deferred. Beware of valuing a company on trough earnings. Dell owners will likely have a profit stream for many years.


PS: I own no stock in Dell