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Gene Jaquet

Gene Jaquet
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  • Wall Street Breakfast: To Hike Or Not To Hike? [View article]
    Blueline, of course you can use the washington free beacon to source your info, but the fact remains that different polls show different results. Here's a bunch that show mixed or pro-deal majorities:

    http://goo.gl/7kIwq5
    http://goo.gl/H5MmdU
    http://goo.gl/6dgNgp
    http://goo.gl/UKs6HQ

    So you're clearly wrong on this point.

    And TAS, for the record I do not get my info from the huff post, it just so happens google sent me there when I queried about how american jews felt about the deal. I pride myself in looking up as many sources as I can from all over the political spectrum before making up my mind on an issue. I always look up the author or the website before reading the article, to be forewarned of bias. It's called being smart.
    Aug 31, 2015. 01:51 PM | 2 Likes Like |Link to Comment
  • Wall Street Breakfast: To Hike Or Not To Hike? [View article]
    Americans are not clearly opposed to the deal - different polls give different results. Even Jewish Americans are evenly divided, according to Huff Post.

    If Israel could destroy the nuclear program with military force, it would have already done so. But much of it is under mountains and out of reach of even the best American bombs. Destruction would require boots on the ground. And even if partially successful, Iran would only re-double it's efforts and have a bomb in less than the 15 year time span of the current deal.

    The deal should be compared to the other realistic alternatives, and those clearly suck. Nobody likes the thought of Mullahs building bombs, but starting a war (that won't even fix the problem) is not a better solution. Such a war would make the current shituation in the middle east seem like a kindergarten spat by comparison. It would cost way more American lives, short term and long term.

    And if the Israelis don't like it, they should have paid more attention to reaching a settlement after the 1973 war. Is 40 years too short to find a solution? The impasse suits Israel because it can keep building settlements and expanding its borders, for as long as it can foist on the American public that it is a victim only. Victims don't steal land with impunity.

    Our national interests are not the same as those of Israel, any more than they are those of Japan or the UK. The current deal if properly implemented will put off the Iranian bomb for longer, and with less bloodshed, than the only alternative which is war - to which we would be party, like it or not.
    Aug 31, 2015. 09:51 AM | 17 Likes Like |Link to Comment
  • Wall Street Breakfast: How Does The Wild Week End? [View article]
    Actually a little research would show that velocity has been on an upward trend in the last 50 years, despite what Buck claims. It has slowed recently, since the financial crisis, but I suspect that has nothing to do with lifestyle trends or technology.

    The explanation probably lies in the definition of velocity itself. It measures (mostly) bank deposits. With interest rates at zero, why keep your money in a bank account? Other forms of saving wealth are more attractive. It's no coincidence that the wealth tired up in the stock market has increased 60% since the crisis, or that bond prices have soared through the roof...
    Aug 29, 2015. 12:23 AM | 3 Likes Like |Link to Comment
  • Wall Street Breakfast: How Does The Wild Week End? [View article]
    @Buck - "the velocity of money is now worse than the worst times of Jimmy Carter's administration. What's happened? I await your collective explanations with bated breath."

    I have no idea why velocity has decreased since Jimmy Carter. I also have no idea why you seem to think it's a socialist plot. In fact, I have no clue as to what your point is - I await clarification with less than bated breath.
    Aug 28, 2015. 04:58 PM | 3 Likes Like |Link to Comment
  • Wall Street Breakfast: How Does The Wild Week End? [View article]
    GGGL, having read your 3rd attempt to clarify your statement, it seems we are not in contradiction, it's just that you have a strange way of saying things.

    "So when you look at the debt and the deficit all of that money is gone, it has produced the economic activity already and it can't magically produce it again." Agreed.

    The whole point of government borrowing/spending in 2008-2009 was to 'produce economic activity' as you say, just when the private sector was reducing economic activity. They leveraged up when the rest of us were deleveraging. The whole point was to smooth out the economic cycle. And I agree, as I posted above, that it's now time for the government to deleverage, cut the deficit and reduce spending, because the private sector is now back on track.

    You're simply stating the obvious - that for government to continue to artificially support demand, it would have to continue borrowing, and that in itself is harmful. I have no qualms with that. Government deficit spending is a policy tool, to be used opportunistically, and should not be a permanent state of affairs.

    What I do disagree with is that the deficit spending post-crisis destroyed wealth, as you first posted. Deficit spending was instrumental in avoiding a major depression. And it is depressions that destroy wealth. So the opposite is true.
    Aug 28, 2015. 04:50 PM | 4 Likes Like |Link to Comment
  • Wall Street Breakfast: How Does The Wild Week End? [View article]
    @Richard - your post was accurate (on both counts) and yes, we do seem to have "alternate" visions on this board!
    Aug 28, 2015. 11:54 AM | 2 Likes Like |Link to Comment
  • Wall Street Breakfast: How Does The Wild Week End? [View article]
    gggl "when I say spend I mean that the money has already done its economic activity and it is not available to do it again." That is clearly wrong - government employees will spend their wages, building contractors will hire workers and buy trucks, and makers of military gear will buy software and set up factories to make weapons. Of course the money circulates. It's what economists call the multiplier effect.

    The point about the velocity of money is how fast it circulates. A dollar that changes hands 10 times a year contributes twice as much to GDP as a dollar that is exchanged just 5 times a year. The money will only "disappear" if the savings rate goes up, i.e. if folks park their money in the bank and the bank doesn't lend it out again. That may have been happening these past few years (we are deleveraging) but it has nothing to do with government spending.

    In fact the whole point of government borrowing/spending increases since the financial crisis is exactly that - to counteract the deleveraging occurring in the private sector, which would have led to a serious depression without government counteraction.

    Government spending in fact avoided the destruction of wealth that occurs during a depression - the exact opposite of what you claim.

    Now that GDP is back on a firm footing, it's time for the government to step back, slim down, and let the private sector borrow and spend by itself again. But that's a whole other debate.
    Aug 28, 2015. 11:03 AM | 5 Likes Like |Link to Comment
  • Wall Street Breakfast: How Does The Wild Week End? [View article]
    "The central bank money went to fund the deficit spending which far outstrips anything they pumped into the economy. Governments then spent that money and it is no longer available to show up in the economy to generate inflation."

    This is screwed-up logic at its finest. How does a government spend money? They pay wages, they pay firms to build highways, they buy military harware, and so forth. All of that will BY DEFINITION show up in the economy.

    You may or may not believe that the government borrows and spends too much, but whatever your view, they do not destroy wealth by borrowing/spending any more than IBM does when it issues a bond to build a factory, or than you do when you take out a mortgage to buy a house.
    Aug 28, 2015. 09:52 AM | 8 Likes Like |Link to Comment
  • Wall Street Breakfast: How Does The Wild Week End? [View article]
    Well said by Hobart16. Another way of putting it would be that the velocity of money has been decreasing, so more money (stock) did not lead to more transactions (flow). The extra money has not fuelled extra demand for goods. Which by the way is why GDP has been relatively stagnant.

    Also, when you ponder why inflation hasn't occured, remember that inflation is a measure of the change in price of a basket of goods and services. As you point out, this price has not increased. But what HAS increased in price are assets excluded from that basket: namely houses and stocks. In particular, stocks are up 60% in 5 years. That's where the inflation is.
    Aug 28, 2015. 09:34 AM | 8 Likes Like |Link to Comment
  • Wall Street Breakfast: Is The Worst Over? [View article]
    @Rockafella - forgot to take your medication this morning?
    Aug 26, 2015. 11:40 AM | 6 Likes Like |Link to Comment
  • Wall Street Breakfast: Is The Worst Over? [View article]
    The Dow will wiggle around 16,000 for some time yet.

    Since the 80's, the length of 10%+ stock market corrections has varied from 3 weeks to 8 months. We are now day 5.
    Aug 26, 2015. 10:20 AM | 3 Likes Like |Link to Comment
  • Wall Street Breakfast: Panic In China Reverberates [View article]
    Thanks Blue. I mostly use trailing and forward PE, and give some weight to the charts but just so as to get a feel for momentum. ROE also factors into my choices. I haven't looked at the Graham, will do so.. but any metric that is based on book is suspicious to my mind.

    I suppose the metrics you use should be in harmony with your trading style and investment objectives - my own horizon is 2 to 3 years, meaning I try to pick stocks that will outperform over that time period. The main problem with this is that when a stock tanks after a couple of months, you're faced with a real dilemma - do you hold and stick to your strategy or do you admit defeat and cut your losses. It's one of the toughest choices to make.
    Aug 25, 2015. 08:58 AM | Likes Like |Link to Comment
  • Wall Street Breakfast: Global Markets Look To Escape Pull From China [View article]
    Actually, human emotion is about the only thing that IS predictable...
    Aug 25, 2015. 08:45 AM | 6 Likes Like |Link to Comment
  • Wall Street Breakfast: Global Markets Look To Escape Pull From China [View article]
    Go to Schwab. Excellent service.
    Aug 25, 2015. 08:37 AM | 2 Likes Like |Link to Comment
  • Wall Street Breakfast: Global Markets Look To Escape Pull From China [View article]
    As a side note - the fact that HFT now accounts for a sizable portion of volume on the NYSE, renders obsolete the old adage that you can spot the bottom when the volume peaks. HFT wreaks havoc with the correlation between trading activity and directional change, simply because all the buying is not for keeping... well, not for keeping longer than a few seconds, if that.

    My take is that the drop of the last 3 days was far too fast for there to be a sizable, lasting rebound today or tomorrow. There will likely be some saw-tooth action before reaching a safe entry point.

    If you are not a market timer, now is not the time to start.
    Aug 25, 2015. 08:35 AM | 8 Likes Like |Link to Comment
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