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The Last Boomer

The Last Boomer
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  • Yes, China's Market Is In A Bubble, And No, It Won't End Well [View article]
    The "controlled" aspect of the Chinese economy makes it not more but less efficient. This is the big difference between a free market and a centralized economy. In the centrally planned economy a small group of people at the top think they know better than the masses what is needed, what has to be built, distributed, where, how, etc. In a free market economy the market makes all these decisions. History has proven that the free market is much more efficient in creating wealth than a centrally managed economy.
    Apr 24, 2015. 12:52 PM | Likes Like |Link to Comment
  • U.S. Equity And Economic Review For The Week; False Break-Out Edition [View article]
    Market is trying hard to break out but there is not enough buying pressure. Somehow every time it starts going up, the rally fizzles out. Still the setup is bullish.
    Apr 23, 2015. 09:40 PM | 1 Like Like |Link to Comment
  • Is Contagion Returning? [View article]
    In the Eurozone the political will to keep Europe alive meets the economic realities of an ill-conceived currency union. Can the Europeans lift themselves by the hair and levitate in thin air thus defining the laws of economic gravity? Remains to be seen but I doubt it. Anyway, this process of slow dismantling or painful adjustments will take so long, it is not worth placing any bets on it going one way or another. And when something substantial finally happens, it will be so sudden that only the most connected or the smartest (or the most stubborn) among us will make any money from it.
    Apr 20, 2015. 06:03 PM | Likes Like |Link to Comment
  • U.S. Equity And Economic Review For The Week; False Break-Out Edition [View article]
    Thank you, Hale. Very, very informative.
    Apr 20, 2015. 08:49 AM | Likes Like |Link to Comment
  • Weekly Indicators: The U.S. Consumer Steps Up To The Plate Edition [View article]
    American steel is hit by cheap imports that amounted to 28% of the demand in 2014, up from 23% a couple of years ago. The strong dollar combined with decreasing demand from China attracted many foreign steelmakers to the American market.
    Apr 19, 2015. 07:14 PM | Likes Like |Link to Comment
  • Long And Winding Road Ahead For LeapFrog [View article]
    The most valuable asset LF has is the brand. It is the best known educational brand for kids. I know this because I have done the marketing research. It is the first name that comes to parents' minds when they try to think about an educational kids brand. How much is the brand worth? I have not done this type of research but it's not that difficult to do it if this is your goal. I would recommend conjoint analysis where the main goal is to see the price premium that people are willing to pay for a product that carries the Leapfrog brand name versus a generic, non-branded product of the same quality. A similar approach is to look at the volume premium of the branded product versus the non-branded product if the price is the same.
    Apr 17, 2015. 07:52 PM | Likes Like |Link to Comment
  • Is The Dollar Breaking Out? [View article]
    The speed of change in the dollar value depends on how far away from the long-term trend the dollar has moved. If it is too close to the upper or lower range of deviations, the move is sharper and faster. A typical dollar move is up to 40%: from 20% under fair value to 20% over fair value. Today it is 10%-14% above fair value. Given how sharply the dollar moved up (the fastest change in history), I would not be surprised if the reversal is also very speedy. There are things that are truly different today: high-frequency trading, trading in general is more popular than ever. The investing horizons have shrunk to days. Everybody is trying to move with the speed of light to take advantage of trends. Trades get very crowded very fast.
    Apr 17, 2015. 12:57 PM | 1 Like Like |Link to Comment
  • Is The Dollar Breaking Out? [View article]
    There was a good article by a few days ago: "How much more dollar appreciation?". Econbrowser estimates the dollar is about 14% above fair value. Analysts from Deutchebank think it is more like 10%. It looks like they all agree that this may run up to 20% based on historical analysis. Therefore, there is a little more room for dollar appreciation but not too much: 5%-10%. At the same time in the last nine months the dollar has packed 3-years worth of appreciation. The speed at which the dollar moved up suggests that we may be in a period of consolidation and even correction. Anyway, my thesis is that from now on, every move the dollar makes up would be a good opportunity to start building a position in select assets that move in the opposite direction of the dollar: energy, materials, industrials, etc.
    Apr 17, 2015. 08:43 AM | 2 Likes Like |Link to Comment
  • U.S. Equity Market Review; Are We Doomed To Weaker Growth? [View article]
    SPY has been forming a symmetrical triangle since late-February which is a pattern that tends to be bullish. Before that we had a descending triangle from Dec to beginning of Feb that usually is a bearish pattern but still resolved to the upside. The market still tends to resolve the patterns that go sideways to the upside. However, given how expensive (or fairly valued, if you prefer) stocks are, the upside movements also tend to be limited in scope. The September peak of SPY was 200 and in almost seven months we have advanced only 5% or so which is quite meager compared to the recent years.
    Apr 13, 2015. 10:10 PM | Likes Like |Link to Comment
  • Will The AIIB One Day Matter? [View article]
    I was just kidding about the length. I have read everything prof. Pettis has written in the last 3-4 years plus one of his books. He is my favorite economist.
    Apr 13, 2015. 04:52 PM | 2 Likes Like |Link to Comment
  • Will The AIIB One Day Matter? [View article]
    I have to agree with Vasilis that for Seeking Alpha this article is too long. We like one-liners here, a-la-Cramer style: buy, buy, buy, sell, sell, sell.
    Apr 12, 2015. 12:24 PM | 4 Likes Like |Link to Comment
  • This Is The Graph That Scares Me Still [View article]
    how about the impact of the stronger dollar on real wages? cheaper imports mean higher real wages.
    Apr 11, 2015. 09:24 AM | 1 Like Like |Link to Comment
  • International Economic Week In Review: Looking At The Global Problem Spots Edition [View article]
    One region conspicuously missing from this list is Europe. Europe seems to finally have caught a break. The falling euro is lifting all boats there. The currency depreciation stalled for the moment and it remains to be seen how this will impact Europe.
    Apr 5, 2015. 07:06 AM | Likes Like |Link to Comment
  • I'm Raising The Caution Flag On The U.S. Economy [View article]
    and this is why the stock market rally stalled.
    Apr 1, 2015. 06:16 PM | Likes Like |Link to Comment
  • Frenzied Speculative Activity In China's Equity Markets [View article]
    Markets can stay irrational longer that you can stay solvent. This is going to crash but when is anyone's guess.
    Mar 30, 2015. 08:10 AM | Likes Like |Link to Comment