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  • ICSC Retail Store Sales: -1.7% W/W, vs. +1.4% last week. +1.0% Y/Y vs. +2.3% last week. Abnormally cold weather led to decline in demand of spring seasonal goods [View news story]
    Weather is so versatile.
    Mar 26, 2013. 09:58 AM | Likes Like |Link to Comment
  • Tesla Motors (TSLA +0.8%) will push back the launch of its Model X to late 2014, according to comments from reps and information contained in a SEC filing (10-K). Tesla on the Model X delay: "We do not expect a material impact on our profitability in 2013 or 2014." [View news story]
    "We do not expect a material impact on our profitability in 2013 or 2014."

    Does anyone else see the irony in that statement?

    Mar 11, 2013. 01:16 PM | Likes Like |Link to Comment
  • Weighing The Week Ahead: Will Opinion Replace Data? [View article]
    Education inflation just hit its highest level in history by rising over 8% last year. Interestingly this coincided with:

    "The Fed's biggest asset (surprise!) is student loans. Without going into many complex policy details, I suspect that most share my sense: This has a bad feeling to it."

    So is correlation causality?

    When you subsidize something you mask its true price and eliminate the market mechanism for competitive pricing pressure. When the government gets involved, prices inevitably skyrocket as this is proving not just now but over the last 10 years. Yet ironically there is a call to increase funding even more.

    From the WSJ last week:

    "The average amount that students at public colleges paid in tuition, after state and institutional grants and scholarships, climbed 8.3% last year, the biggest jump on record, according to a report based on data from all public institutions in all 50 states to be released Wednesday by the State Higher Education Executive Officers Association. Median tuition rose 4.5%."

    This chart only runs to late 2012 but it certainly tells a story:

    Where is the outrage for the corporate welfare given to Big Education? Why aren't we protesting the high cost of education?
    Mar 11, 2013. 10:55 AM | Likes Like |Link to Comment
  • Dow Reaches New Heights - Is The End Near? [View article]

    The value of cash is that it has optionality and that is what you are describing so well. Putting a value on that optionality is what people fail to quantify more often than not or it is deliberately disparaged by the market mavens/salespeople who get paid fees only when money is invested - certainly a conflict of interest in my opinion :)

    One of my favorite writers on financial topics is James Montier who wrote this piece in 2011 which I think is a must read:

    "A Value Investor’s Perspective on Tail Risk Protection:
    An Ode to the Joy of Cash"

    Cash in 2008/09 was worth a lot more relative to its purchasing power than it was worth in 2007. Twice as much house, twice as much gold, twice as much stock for the exact same dollar. The key is deploying it when everyone else is fearful. I still need help on that front :)
    Mar 9, 2013. 12:01 PM | 1 Like Like |Link to Comment
  • February Nonfarm Payrolls: +236K vs. consensus +160K, 119K previous (revised from +157K). Unemployment rate 7.7% vs. consensus 7.9%, 7.9% previous. [View news story]
    Why the downward revision to last month given the current strength?

    That seems out of step.
    Mar 8, 2013. 08:38 AM | 2 Likes Like |Link to Comment
  • Short sales on S&P 500 stocks fall to 5.6% of shares available, according to Bespoke. It's the lowest ratio since at least 2007 and compares to a record 12% amid the financial crisis. "When you have a market where investors are all in, there will no longer be short covering," says one money manager. [View news story]
    Lots of interesting contrarian signals out there.
    Mar 4, 2013. 08:17 AM | Likes Like |Link to Comment
  • More on Personal Income: The 3.6% decline in income was the sharpest in 20 years, but it comes after December's 2.6% spike on the wave of pre-tax hike special dividends and bonuses. [View news story]
    "The 3.6% decline in income was the sharpest in 20 years,"

    Interestingly that stat includes two recessions. Can that actually be correct?

    Just read this on Bloomberg:

    "The saving rate dropped to 2.4 percent from 6.4 percent. Disposable income, or the money left over after taxes, dropped 4 percent after adjusting for inflation, the biggest plunge since monthly records began in 1959."

    That's literally a freakish change in the saving's and DI rates in one month.

    How's this for spin in the article:

    " showing households were weathering the payroll-tax increase by socking away less money in the bank."

    LOL. Do you think this would be the phrase under an opening to an article with a Republican government?
    Mar 1, 2013. 09:07 AM | Likes Like |Link to Comment
  • Jan. Personal Income and Outlays: Income -3.6% m/m vs. -2.1% expected, +2.6% prior. Personal spending +0.2% m/m vs. 0.2% expected, +0.2% prior. PCE core price index +0.1% vs. +0.2% expected,  +0.0% prior. [View news story]
    Income was pulled forward in Q4 to avoid taxes which obviously was wise so anyone surprised by this shouldn't be.

    Amazing that cutting government spending could "plunge us into a recession" but somehow taking money out of people's pockets in higher taxes is somehow a good thing.

    Taxes hurt.
    Mar 1, 2013. 09:05 AM | Likes Like |Link to Comment
  • Jan. Chicago Fed National Activity Index: -0.32 vs. +0.25 (revised) prior. [View news story]
    "The index’s three-month moving average, CFNAI-MA3, increased to +0.30 in January from +0.23 in December. Given the substantial upward revisions for November and December, January’s CFNAI-MA3 marked the third consecutive reading above zero. Additionally, January’s reading suggests that growth in national economic activity was somewhat above its historical trend. The economic growth reflected in this level of the CFNAI-MA3 suggests limited inflationary pressure from economic activity over the coming year."
    Feb 25, 2013. 09:11 AM | 1 Like Like |Link to Comment
  • "If capitalism is America’s biggest problem, why save it?" asks MarketWatch's Paul Farrell. "Wall Street, Corporate America, Big Oil and the entire economy been transformed into a bizarre circus Adam Smith would never recognize. Capitalism is now an out-of-control Frankenstein monster that changed everything." Not that Farrell provides any alternatives. [View news story]

    Your writing reminds me of the Ali Poem:

    "Me. We!"

    Profound if you take the time to understand it :)
    Feb 24, 2013. 11:50 AM | 3 Likes Like |Link to Comment
  • Claiming auto lending as part of its mandate, the CFPB has sent letters to at least four banks threatening to sue over discriminatory practices. A highly fragmented market, it's hard to say which lender is being targeted. Regulation of auto lending was explicitly given to the FTC. It's fascinating how bureaucracies instinctively grasp to expand their size and power. [View news story]
    "It's fascinating how bureaucracies instinctively grasp to expand their size and power."

    What's fascinating is that someone would actually believe this to be an unusual side-effect of expanding government reach :)
    Feb 21, 2013. 12:20 PM | Likes Like |Link to Comment
  • Though Tesla Motors (TSLA -9.2%) CEO Elon Musk is taking the hardest loss today on the automaker's tumble in share price, Daimler (DDAIF.PK) is also suffering with its 4.7% stake in TSLA making it number two on the list while Toyota (TM -1.1%) also has a stake. Interestingly, Musk says he won't ask the big boys for more money but will fund Model X SUV production through profits. Look for issues of Tesla cash flow to be a major topic in 2013. (transcript[View news story]
    Just looked at the current quarter income statement. How exactly does he define the word "profit"?

    Looks like a $100 million dollar burn rate based upon the cash flow unless I am reading it wrong.
    Feb 21, 2013. 10:57 AM | Likes Like |Link to Comment
  • Initial Jobless Claims: +20K to 362K vs. 359K consensus, 342K prior (revised). Continuing claims +11K to 3.14M. [View news story]
    The next few weeks will be interesting with the more aggressive seasonal factors - could be messy unless there really is marked improvement (releasing my inner bbro :)).
    Feb 21, 2013. 09:10 AM | 1 Like Like |Link to Comment
  • Lots Of Dumb Money On The Sidelines: Should Smart Investors Buy Stocks? [View article]
    Every stock sale has a buyer and seller.

    The seller who thinks the price will fall in the future and the buyer who thinks it will rise. Who's right?

    As James pointed out in that prior article it is simply an accounting identity that money put into the market is replaced by money removed from the market with a net effect that the total money in circulation has not changed.

    Confusing individual micro level transactions and making macro judgments is the fallacy that James has been debunking in this series of articles and I for one really applaud his efforts.

    I learned two important things in working as a financial advisor for the high net worth client: read the footnotes on any exhibit first and all equity data/returns are beginning and endpoint sensitive. When you apply these rules you quickly realize there is no such thing as an "average" return on anything it all depends upon entry (buying) and exit (sellling) points.
    Feb 20, 2013. 05:03 PM | 3 Likes Like |Link to Comment
  • Some 40K people marched on the U.S. capital over the weekend to protest the Keystone XL (TRP) pipeline project, whose rejection could cause a deep and lasting rift with the U.S. But perhaps Canada is not such a benign trading partner, according to Huffington Post's Raymond Learsy, who says Alberta’s government has given "generous donations to Islamists with close connections to Hamas." [View news story]
    Those scary Canadians!

    We all know how radical they really are and who knew they were on our unprotected northern border.

    I say we rally to build a gigantic concrete fence on the Alberta border. Seriously who really wants cheaper gas?

    FYI, US foreign aid of around $500 million dollars is sent to the Palestinian authority on an annual basis - some of those dollars find their way to "Islamists" and Hamas.
    Feb 19, 2013. 09:28 AM | 1 Like Like |Link to Comment