Financial Acumen's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.comuser/335383/comments http://seekingalpha.com/article/120016-in-praise-of-suze-orman?source=feed#comment-389384 389384
However, when she dabbles in other fields, it becomes clear that her knowledge has its limits. While the basics of personal finance are key to any successful investor, they are not synonymous with developing an investor's acumen. I would advise any of my friends that have yet to save a dime for retirement, or would like to know if they should open up what type of account, or ask what the difference between a 401K and a Roth IRA, to pick up a book by Suze Orman to get the lingo down.

When it comes to stock picking, macro-economic trends, Fed policy, and other investment affairs, there are much more credible authors than Orman. The learning curve also becomes much steeper at this point.]]> Sun, 15 Feb 2009 12:34:52 -0500
However, when she dabbles in other fields, it becomes clear that her knowledge has its limits. While the basics of personal finance are key to any successful investor, they are not synonymous with developing an investor's acumen. I would advise any of my friends that have yet to save a dime for retirement, or would like to know if they should open up what type of account, or ask what the difference between a 401K and a Roth IRA, to pick up a book by Suze Orman to get the lingo down.

When it comes to stock picking, macro-economic trends, Fed policy, and other investment affairs, there are much more credible authors than Orman. The learning curve also becomes much steeper at this point.]]> http://seekingalpha.com/article/120632-15-deep-value-plays?source=feed#comment-389371 389371 Sun, 15 Feb 2009 12:24:24 -0500 http://seekingalpha.com/article/115310-morningstar-s-biggest-error-the-perils-of-youth?source=feed#comment-360334 360334
Thanks for the fascinating read. I think anyone in this business should rely on their own analysis for the bulk of their decision-making, and have the analysts such as Morningstar corroborate at most. Sometimes, they may spot a gap in logic that you may have overlooked...but in no way would I ever make more than a minuscule side-bet solely based on what any analyst said, even Buffett. ]]> Mon, 19 Jan 2009 19:26:36 -0500
Thanks for the fascinating read. I think anyone in this business should rely on their own analysis for the bulk of their decision-making, and have the analysts such as Morningstar corroborate at most. Sometimes, they may spot a gap in logic that you may have overlooked...but in no way would I ever make more than a minuscule side-bet solely based on what any analyst said, even Buffett. ]]> http://seekingalpha.com/article/115314-is-economic-expansion-dependent-upon-a-healthy-banking-sector?source=feed#comment-360129 360129
"Now, we can move on to Circuit City. The rumor was that Circuit City had three parties that were potentially interested in acquiring the company. Apparently, none of them was willing to pay a price sufficiently high that would exceed what Circuit City thought it could gain by selling off inventories and closing its doors. Again, here is a bet the potential acquirers were not willing to make - a bet on the value of the assets of Circuit City. This seems to be the other side of the Bank of America / Merrill Lynch transaction: How can a company buy someone else when they don’t have a good feel for what the underlying assets are really worth?"

I can name at least two reasons off the top of my head why Circuit City was forced to liquidate:

1) Business conditions going forward are not at all friendly to consumer discretionaries - this could result in unforeseen inventory write-offs completely unrelated to the credit crisis, but very much related to the ongoing recession

2) Best Buy has a stranglehold in this segment of retailing, nearly reaching saturation on its own, to say nothing of Walmart, Kmart, etc.

Besides this, I completely agree with CautiousInvestor.]]> Mon, 19 Jan 2009 15:06:24 -0500
"Now, we can move on to Circuit City. The rumor was that Circuit City had three parties that were potentially interested in acquiring the company. Apparently, none of them was willing to pay a price sufficiently high that would exceed what Circuit City thought it could gain by selling off inventories and closing its doors. Again, here is a bet the potential acquirers were not willing to make - a bet on the value of the assets of Circuit City. This seems to be the other side of the Bank of America / Merrill Lynch transaction: How can a company buy someone else when they don’t have a good feel for what the underlying assets are really worth?"

I can name at least two reasons off the top of my head why Circuit City was forced to liquidate:

1) Business conditions going forward are not at all friendly to consumer discretionaries - this could result in unforeseen inventory write-offs completely unrelated to the credit crisis, but very much related to the ongoing recession

2) Best Buy has a stranglehold in this segment of retailing, nearly reaching saturation on its own, to say nothing of Walmart, Kmart, etc.

Besides this, I completely agree with CautiousInvestor.]]> http://seekingalpha.com/article/114549-using-sector-weight-analysis-to-identify-the-next-bubble?source=feed#comment-355085 355085
I must say, I find it hard to believe that basic materials have fallen throughout these past 5 years. That would seem ripe for a pullback, if not an outright boom, after the economy rights itself. Well done.]]> Tue, 13 Jan 2009 21:43:31 -0500
I must say, I find it hard to believe that basic materials have fallen throughout these past 5 years. That would seem ripe for a pullback, if not an outright boom, after the economy rights itself. Well done.]]> http://seekingalpha.com/article/114253-want-to-reform-wall-st-bring-back-partnership-investment-banks?source=feed#comment-354005 354005 Mon, 12 Jan 2009 22:24:45 -0500 http://seekingalpha.com/article/114242-why-it-s-wise-to-sell-on-dividend-cuts?source=feed#comment-352794 352794
"What is your way of determining if a stocks dividend is going to be cut?"

I'd check out the payout ratio. The logic is very similar, in that if the payout ratio increased by a significant amount, like say, from 20% of earnings to 85%, or even over 100%, then you have a key indicator of an unsustainable dividend. Such numbers are published in the S&P STARS reports that are generally free for anyone with a brokerage account.]]> Sun, 11 Jan 2009 19:57:03 -0500
"What is your way of determining if a stocks dividend is going to be cut?"

I'd check out the payout ratio. The logic is very similar, in that if the payout ratio increased by a significant amount, like say, from 20% of earnings to 85%, or even over 100%, then you have a key indicator of an unsustainable dividend. Such numbers are published in the S&P STARS reports that are generally free for anyone with a brokerage account.]]> http://seekingalpha.com/article/114242-why-it-s-wise-to-sell-on-dividend-cuts?source=feed#comment-352791 352791

On Jan 11 01:00 PM Paul Price wrote:

> Even better than selling after a dividend cut would be realizing
> the payout was likely unsustainable and selling BEFORE the big drop
> that accompanies the dividend reduction announcement.]]> Sun, 11 Jan 2009 19:53:05 -0500

On Jan 11 01:00 PM Paul Price wrote:

> Even better than selling after a dividend cut would be realizing
> the payout was likely unsustainable and selling BEFORE the big drop
> that accompanies the dividend reduction announcement.]]> http://seekingalpha.com/article/113843-housing-where-is-the-bottom?source=feed#comment-352788 352788
I especially liked PrudentInvestor's article - seems the Economist saw this coming 5 years ago...thanks again.]]> Sun, 11 Jan 2009 19:42:06 -0500
I especially liked PrudentInvestor's article - seems the Economist saw this coming 5 years ago...thanks again.]]>