Meredith Whitney Quitting Oppenheimer Shows Contrarian Indicators Still Work [View article]
Cetin Hakimoglu wrote <She's [Meredith Whitney] also way too young. Only 38. She needs to settle down and stop trying to get ahead. >
Cetin, Let me get this right. Research on the internet I believe will show you are approximately 26-27, live with your mother who supports you, have no job other than posting about 30-40 comments on SA a day to extreme negative ratings, have been banned on other websites for abusive comments, have removed all your previous posts on other sites recommending the purchase of GOOG at over $700 a share a year or so ago, and yet you have the audacity to criticize a woman for honorably and well carrying our her professional responsibilities? Have you no shame? Are you autistic?
Is Obama Selling Military Secrets to China for Debt Forgiveness? [View article]
I'm amazed at the number of people who take this story seriously and not as an obvious anit-Obama political rant by some unknown paid for hire right wing hack used to boost clicks to the web site. This is pure propaganda. Notice the banner ad next to this SA post and then notice the exact same banner ad at the site in question.
What many of you do not realize is that by believing in this kind of crude propaganda you are contributing to the instability of the US government itself and not just Obama's adminstration. There are many in the world who would be happy at this development. Don't be one of them. How about we try "United we stand, divided we fall". Think it over.
Now's a Great Time to Hedge Your Gold Bets [View article]
<Re: "A gold denarius is still about as valuable as it was when Caesar conquered Gaul">
It may be a minor quibble, but there is no such thing as a Roman gold denarius. The denarius was a silver coin with a content at the time of Ceasar about 3.9 grams and one day's payment to an unskilled laborer or common soldier. With a conversion of 1 troy oz = 31.1 grams, and the price of silver currently about $13.50 per oz, an equivalent contemporary silver content denarius would be worth a bit less than $2 at today's prices. This is obviously much less than a day's pay to an unskilled laborer in the US, but may indeed approximate the day's pay for unsklled labor in much of the underdeveloped world.
The Roman gold coin at the time of Ceasar was the aureus, with a content of approximately 8 grams and worth then about 25 denarii. One oz of gold today would therefore be equivalent to about 4 aureii, or 100 denarii.
I leave it to others to calculate whether gold has held its purchasing power over these 2000 years, but I think we can agree that gold is a good investment during inflationary times, although not the only one. I note that Bismark put much of his wealth into buying forests which happened to preserve the inherited wealth for his descendents during the German hyper inflation of the early 1920s.
Cetain wrote <MCD MA GOOG AAPL RIMM POT. These stocks tend to go up all the time, have low volatility...>
In fact, MA traded at 320 in early 2008 before trading down to 120 early this year, GOOG traded as high as 750 before hiting its low of 250 last November, etc. If these are examples of stocks going "up all the time" and having "low volatility", one can understand why this guy has the largest negative comment rating in SA (what is it now? -5000? -6000?). Cetin, time to take a vacation.
Meredith Whitney Quitting Oppenheimer Shows Contrarian Indicators Still Work [View article]
Cetin wrote <Why do ppl keep flaming me?>
If you are serious and want my advice: First, show respect to all people even those you don't like or think can't think. This is the golden rule and it works pretty well for most folks. Second, don't comment so much that its seems like spam or junk email. I find it irritating and I suspect others do as well. I get your points; you don't have to repeat the same thing day after day on every person's post. Third, if you do comment, make it more substantive and backed up with reasoning and facts. Not everyone who is "flaming" you disagrees with you. Rather it is the simplistic manner in which you post. Four, don't go on about your being the smartest or wisest person in the world. Maybe you are but humility works wonders.
And speaking of that, perhaps I am wrong about all this, as I am not perfect either. But you asked for an opinion.
Does Quant Fund Unwinding Explain Bullish Market Behavior? [View article]
Thanks for providing an unusual and sharp perspective on recent market action, and I've enjoyed some of your other articles also which go off the beaten path. My sense is that the problem quant funds have had (in Aug 07 and after) is that they are increasingly all doing the same thing. When the funds were small as a proportion of overall market activity, this could work to capture inefficiencies, but when they become a dominant part of the market, they are at risk of becoming the inefficiency themselves because the quant model itself is perversely blind or un-self reflective to this kind of extra-market risk.
Be Prepared for S&P to Hit 350 by June 2010 [View article]
Ryan, My take on your analysis that you're probably reversing cause and effect here. Advanta going out of business is not going to cause small businesses going out of business, since it was small businesses going out of business that probably caused Advanta going out of business. If that is true, Advanta will not appreciably effect much in the future since the small businesses going out of business are already going out of business no matter what Advanta does, and the ones that were not going out of business have or will have other sources of credit.
Also, in my opinion, the call that the SP is going to 350 based on this analysis is just too "out of the hat" since it implies that the SP will be trading a something like five times earnings. Now we all like to bash analysts' consensus earnings as too optimistic, but man, you've set a record here. You sound like Joe Granville. And if you're old enough to know who that is, you're old enough to be wise enough to make money by listening to the market rather than telling the market where it has to go.
China and India Vie for the World's Natural Resources, Part 1: China in Australia [View article]
Thanks for a very informed article that confirms information from other sources. I do happen to be long various resource commodities already, but leaving personal investments aside, what is worrying is the geodynamic squeeze on the US now that it is financially handicapped by trying to rectify past economic blunders.
Does a 58-Point Increase in the Philly Fed Forecast Index Signal the End of Recession? [View article]
While the Philly Fed's recent six month forcast in economic activity diffusion index has increased comparably to that in early 2001, you may note that stocks continued to decline for two years after that increase in 2001. If the 2001-2003 six month economic forcast-stock market association holds, we may expect stocks to begin the next bull market when? Ummm..... according to your chart, it seems like the end of 2010.
I'm not trying to be critical. The stock market anticipated all previous recession recoveries except the last one. We don't know yet whether that case was a one-time exception or the begining of a new pattern. Personally, I find the official dating of the 2001 recession was suspect on a number of counts (which explains the anomolous stock market relationship), but that is for another post. Interesting chart though, thanks.
China and Brazil to Ditch U.S. Dollar? Hardly [View article]
I suppose it's a technical note, but the Chinese currency is the renminbi and not the "yuan", which is actually the unit of currency of the renminbi. To the Chinese this is like calling the US currency the dime or penny. Still, saying renminbi all the time is a bit of a tongue twister I'll admit, and since we're Americans let's just call it what we want!
A Must See Movie: 'Zeitgeist Addendum' Explains the Fiat Money System [View article]
I'm afraid my positive comment rating is going to take a dive with this note, but I found the first 15 minutes of this film so full of distortions and errors that (with all due respect) it began to remind me of some sort of propaganda film and I stopped watching.
I'm not going to go into a lot of detail here, since you either understand what I am going to say or you don't, but let's start with how the film introduces money creation. The film says that if the government needs money it creates a bond which it sells to the Fed which prints the money and sends over to congress. That is certainly one possibility, and if that explanation were the whole story as it is portrayed in the film, you would have a country pretty much like Zambia with trillion dollar notes buying an apple. In fact, which the film does not show, the sale of US bonds is primarily to the private primary dealer market and other investors, and only as a last resort to the FED if no other buyers can be found. After all, that's how China has ended up with a trillion dollars of US bonds and notes isn't it?
To take another example of distorted portrayal here, the film says in context of the commercial banking systems creation of money through loans, that this new money "steals value" from existing money because new money is created irrespective of demand for goods and services. But contrary to the film's statement, this is only a possibility not a given fact, and in fact, the more usual outcome is that loans through productive investment produce new goods and services, thereby creating new aggregate wealth, which in turn does not "steal value" from existing money. And that's why the economy keeps growing.
As a last note, the film states that only 1% of the population in the US owns 40% of the wealth, and then adds "we know something is very wrong here". The fact is correct, but not the conclusion. In fact, in much of the world, and in almost all of human history, about 1% of the population owns or owned about 90% of the wealth of society. To have this 1% percent own only 40% shows that the wealth ownership in the US has been more widely spread than in much of the world or in history. I would think that's a good thing. If you think that it's "very wrong", then I suggest you join a socialist party or something.
I am certainly not denying that hyperinflation can and sometimes does present a danger to society. Indeed I am currently overweighted in precious metals and natural resources, but this is not an absolute buy and hold strategy. I will certainly be glad when the time comes to dump this stuff there is someone always willing to overpay for it. Anyway, if you think the world works the way its portrayed in this film, good luck in your investments
Wall of Waiting Cash Could Drive Equities Higher [View article]
The "Wall of Waiting Cash" that appears reflected in the increasing proportion of assets held in money market funds compared to equity funds (according to the chart) is almost entirely a reflection of the decline in value of the equity fund assets due to declining stock prices and not the transfer of funds from equity to money market funds. Since investors in MM funds often have different purposes and more conservative risk tolerances than equity fund investors, this changing proportion of asset values may not and probably does not portend any "waiting cash" on the sidelines.
'U.S. Banking System Is Effectively Insolvent' - Soros [View article]
Fighting Yoda wrote <Capitalism, free markets, accountability and moral hazard must be restored.>
You may want to restore capitalism, free markets and accountability, but moral hazard is generally defined as the antithesis of these, i.e., the condition where the party that takes the risk and benefits if it is successful is not the same party that pays for the risk when it doesn't work out. I'm not sure you meant to say that.
Meredith Whitney Quitting Oppenheimer Shows Contrarian Indicators Still Work [View article]
Cetin, Let me get this right. Research on the internet I believe will show you are approximately 26-27, live with your mother who supports you, have no job other than posting about 30-40 comments on SA a day to extreme negative ratings, have been banned on other websites for abusive comments, have removed all your previous posts on other sites recommending the purchase of GOOG at over $700 a share a year or so ago, and yet you have the audacity to criticize a woman for honorably and well carrying our her professional responsibilities? Have you no shame? Are you autistic?
Is Obama Selling Military Secrets to China for Debt Forgiveness? [View article]
What many of you do not realize is that by believing in this kind of crude propaganda you are contributing to the instability of the US government itself and not just Obama's adminstration. There are many in the world who would be happy at this development. Don't be one of them. How about we try "United we stand, divided we fall". Think it over.
Now's a Great Time to Hedge Your Gold Bets [View article]
It may be a minor quibble, but there is no such thing as a Roman gold denarius. The denarius was a silver coin with a content at the time of Ceasar about 3.9 grams and one day's payment to an unskilled laborer or common soldier. With a conversion of 1 troy oz = 31.1 grams, and the price of silver currently about $13.50 per oz, an equivalent contemporary silver content denarius would be worth a bit less than $2 at today's prices. This is obviously much less than a day's pay to an unskilled laborer in the US, but may indeed approximate the day's pay for unsklled labor in much of the underdeveloped world.
The Roman gold coin at the time of Ceasar was the aureus, with a content of approximately 8 grams and worth then about 25 denarii. One oz of gold today would therefore be equivalent to about 4 aureii, or 100 denarii.
I leave it to others to calculate whether gold has held its purchasing power over these 2000 years, but I think we can agree that gold is a good investment during inflationary times, although not the only one. I note that Bismark put much of his wealth into buying forests which happened to preserve the inherited wealth for his descendents during the German hyper inflation of the early 1920s.
A Wall St. Economist on the U.S. and China [View article]
Any thought on who these "other buyers" might be; that is, when they "emerge"?
Screening for Trends [View article]
In fact, MA traded at 320 in early 2008 before trading down to 120 early this year, GOOG traded as high as 750 before hiting its low of 250 last November, etc. If these are examples of stocks going "up all the time" and having "low volatility", one can understand why this guy has the largest negative comment rating in SA (what is it now? -5000? -6000?). Cetin, time to take a vacation.
Meredith Whitney Quitting Oppenheimer Shows Contrarian Indicators Still Work [View article]
If you are serious and want my advice: First, show respect to all people even those you don't like or think can't think. This is the golden rule and it works pretty well for most folks. Second, don't comment so much that its seems like spam or junk email. I find it irritating and I suspect others do as well. I get your points; you don't have to repeat the same thing day after day on every person's post. Third, if you do comment, make it more substantive and backed up with reasoning and facts. Not everyone who is "flaming" you disagrees with you. Rather it is the simplistic manner in which you post. Four, don't go on about your being the smartest or wisest person in the world. Maybe you are but humility works wonders.
And speaking of that, perhaps I am wrong about all this, as I am not perfect either. But you asked for an opinion.
Does Quant Fund Unwinding Explain Bullish Market Behavior? [View article]
Be Prepared for S&P to Hit 350 by June 2010 [View article]
Also, in my opinion, the call that the SP is going to 350 based on this analysis is just too "out of the hat" since it implies that the SP will be trading a something like five times earnings. Now we all like to bash analysts' consensus earnings as too optimistic, but man, you've set a record here. You sound like Joe Granville. And if you're old enough to know who that is, you're old enough to be wise enough to make money by listening to the market rather than telling the market where it has to go.
China and India Vie for the World's Natural Resources, Part 1: China in Australia [View article]
Does a 58-Point Increase in the Philly Fed Forecast Index Signal the End of Recession? [View article]
I'm not trying to be critical. The stock market anticipated all previous recession recoveries except the last one. We don't know yet whether that case was a one-time exception or the begining of a new pattern. Personally, I find the official dating of the 2001 recession was suspect on a number of counts (which explains the anomolous stock market relationship), but that is for another post. Interesting chart though, thanks.
China and Brazil to Ditch U.S. Dollar? Hardly [View article]
A Must See Movie: 'Zeitgeist Addendum' Explains the Fiat Money System [View article]
I'm not going to go into a lot of detail here, since you either understand what I am going to say or you don't, but let's start with how the film introduces money creation. The film says that if the government needs money it creates a bond which it sells to the Fed which prints the money and sends over to congress. That is certainly one possibility, and if that explanation were the whole story as it is portrayed in the film, you would have a country pretty much like Zambia with trillion dollar notes buying an apple. In fact, which the film does not show, the sale of US bonds is primarily to the private primary dealer market and other investors, and only as a last resort to the FED if no other buyers can be found. After all, that's how China has ended up with a trillion dollars of US bonds and notes isn't it?
To take another example of distorted portrayal here, the film says in context of the commercial banking systems creation of money through loans, that this new money "steals value" from existing money because new money is created irrespective of demand for goods and services. But contrary to the film's statement, this is only a possibility not a given fact, and in fact, the more usual outcome is that loans through productive investment produce new goods and services, thereby creating new aggregate wealth, which in turn does not "steal value" from existing money. And that's why the economy keeps growing.
As a last note, the film states that only 1% of the population in the US owns 40% of the wealth, and then adds "we know something is very wrong here". The fact is correct, but not the conclusion. In fact, in much of the world, and in almost all of human history, about 1% of the population owns or owned about 90% of the wealth of society. To have this 1% percent own only 40% shows that the wealth ownership in the US has been more widely spread than in much of the world or in history. I would think that's a good thing. If you think that it's "very wrong", then I suggest you join a socialist party or something.
I am certainly not denying that hyperinflation can and sometimes does present a danger to society. Indeed I am currently overweighted in precious metals and natural resources, but this is not an absolute buy and hold strategy. I will certainly be glad when the time comes to dump this stuff there is someone always willing to overpay for it. Anyway, if you think the world works the way its portrayed in this film, good luck in your investments
Wall of Waiting Cash Could Drive Equities Higher [View article]
'U.S. Banking System Is Effectively Insolvent' - Soros [View article]
You may want to restore capitalism, free markets and accountability, but moral hazard is generally defined as the antithesis of these, i.e., the condition where the party that takes the risk and benefits if it is successful is not the same party that pays for the risk when it doesn't work out. I'm not sure you meant to say that.
Impact of Blowout Earnings in a Downward Trending Market [View article]