GoMyLittleSheep

How Buying a Home Is Gambling

"I can't live in my 401K or IRA investments. I can't live in my precious metal holdings or any equities I may own. I can live in a house."

You can't live inside the deed to your house - that would be a more appropriate comparison since you seem to confuse the difference between certificates that spell out rights of ownership with actual goods. Your stocks are tied to physical resources just like your houses deed is.

Having an utilitarian function (being able to "live in" a house) does not enter into the definition for being a "good investment".

Another V-Sign

Contrarian thinking at its best. These comments always crack me up.

Thoughts on the Efficacy of Momentum and Value Investing Strategies

The risk profiles are just different. Mo-mo is self-reinforcing while value is self-repairing. The former encourages instability while the latter is the opposite.

The value strategy will tend to attract buys when under the threshold for being undervalued. If random noise causes the strategy to under-perform the stock will be more undervalued, which should cause an opposite buying pressure in the system by those who seek to buy it.

Momentum will enter phases where random noise will cause it to underperform temporarily, and the built-in strategy will cause even slight oscillations to be violent, causing feedback effects.

Five Worst Performing Country ETFs: A Golden Investment Opportunity?

Those ETFs went up as fast as they went down. I see that more of an indication of a relatively more thinly traded market causing high price sensibility, as well as a higher mix of momentum investors in the securities.

"But If what I wrote was so obvious why did the average investor sell out instead of buying more on dips? Obviously it is not that obvious."

Not sure what point you're trying to make here. You (or I) don't really know what "the average investor" really did. If anything the chart action seems to indicate investors were "buying on dips" in spades.

Your article's sole argument seems to be that these ETFs were high before, and by definition they are guaranteed to go exactly to their prior prices asap - you are not making making any case on fundamentals at all (and any fundamental case for a -country- would be vague at best). You could reuse that argument to imply that every single asset class, from real estate to stocks should return to their prior peaks asap.

Bets on Casual Games Paying Off

"After all, the big gaming players have used M&A as a way to buy a piece of a fast-growing, emerging market. For instance, EA spent $680m in cash four years ago for Jamdat Mobile to get into wireless gaming"

If you bothered to read EA's quarterly reports, you would see that 680M$ was written down by EA last year and was actualy a major component of their GAAP loss.

Paying off indeed.

Ten Reasons I'm Buying Activision Blizzard

So you're extrapolating the lifetime sales for the game based on one day of results based on one sample point from one online retailer which isn't even the largest point of retail for the games? Sorry, but that's just really poor analysis.

"I didn't say or imply that the decline of music games is completely new. However, I do believe it is an issue that ATVI must contend with. It will not be trivial for ATVI to fill the revenue hole that will exist due to the lack of easy Guitar Hero sales."

If it were trivial, then ATVI wouldn't be sitting at 11.50$ right now, 37% below what it was when music sales growth was thought to be indeed trivial. The music game sales won't go to zero, and the discount you're looking for was already given.

The problem with your analysis is you're dealing completely in untangibles with no notion of what anything is worth. You provide no basis for how much of a discount these factors should account for apart from little more than a gut feeling, with makes any discussion rather pointless.

On Nov 20 11:33 AM GhostOfSpec wrote:

> On Nov 19 11:57 PM GoMyLittleSheep wrote:

Ten Reasons I'm Buying Activision Blizzard

You do realize that 7 weeks ago the stock was 1$ higher right? Are you saying you would have bought when it wasn't obvious at 12.50$ but you wouldn't be buying it now at 11.50$ when things are "obvious"?

Sorry what you're saying doesn't make any sense to me.


On Nov 19 01:54 PM bobbybutte wrote:

> As a person who has become financially independent SOLELY through
> investing let me add a few things
>
> First ofall the author has laid out a great argument
>
> Personally I think that this article written 7 weks ago would have
> got my attention alot more and told me about the author digging his
> well before he was thirsty
>
> I dont like doing the obvious

Ten Reasons I'm Buying Activision Blizzard

@GhostOfSpec:
Tony Hawk Ride has been out for exactly one day and you know it's bombing? You must have quite the connections. Or divination powers I should say.

To state that selling 9 million copies of Modern Warfare 2 in a week was already "baked in", as you say, and then in the same breath to imply that the decline of the music games is something completely new that took everyone by surprise truly shows a remarkable bias.

Ten Reasons I'm Buying Activision Blizzard

From what I've researched, assertions that the WoW base is dropping are based on mere speculations and not on fact. Difficulties with the Chinese transition have more to do with government meddling than actual consumer demand.

As for the "surge in free games"... With respect, this is making grand macro-economic theories from the flimsiest of evidence. Videogames at retail are now a 50B$ revenue industry, with the facebook/iPhone games industry generating perhaps 500M$ - much of that revenue based more on viral marketing than on actually meeting a need from customers. Besides, these two markets show little overlap in their consumer base.

The long-term trend in the real world has been for blockbuster games that can get away with charging more per customer (100$+ premium Modern Warfare SKUs, 100$+ music games, 100+$/year MMO subscriptions). The record-breaking sales of MW2 even when the price was hiked 10% rather demonstrates that consumers are a lot less sensitive to prices (for quality products) then some would have you believe.


On Nov 19 07:45 AM Moon Kil Woong wrote:

> The drop off in WoW subscriptions and the resurgence of simple free
> games like facebook games bode ill for Activision. If Starcraft II
> comes out on time, which is improbable, you could see a spike in
> revenue, but I think everyone in the industry is in agreement that
> the long term trend for gaming seems to be cheaper to free.

Ten Reasons I'm Buying Activision Blizzard

Longer console refreshment cycles are not a great worry for me either. New consoles cause ballooning development costs in the short term that cut into profitability. I think the longer cycle is a welcome change.

My largest worry is simply unfavorable action in the market - though it should be mentioned simply doesn't follow the market, with a beta listed as 0.66. The market appears very unwilling to grant anything better than a conservative P/E right now, as the performance of peer companies (ERTS in particular) is dragging the whole sector down.

Blizzard should provide excellent growth with the Starcraft II and WoW expansion coming next year - these should bring in a good 500M-1B$ in additional revenue. I am slightly more concerned that the Activision side can maintain its income base, as Call of Duty is setting a high point that's going to be extremely hard to match next year. My concern would be that the growth from the Blizzard products would be greatly eaten by the shortfall caused by a lack of big title from Activision next year. I do think the forward P/E is based on expectations that are too aggressive (0.78 from the current 0.63 guidance is a very large jump).

Beyond next year however, the incremental addition of Diablo III, expansions to the various games, etc. should provide a good growth base for the long term.

What's Wrong with the Gaming Industry?

Amidst all this blablabla, Modern Warfare 2 has now shattered one-day sales records by a 100% margin.

But hey, why spend time in reality when you can write an article giving a list of bogeymen about how the industry is in decline.

Gold Is Not in a Bull Market

Basically every one of your points were of the form: gold is liked by many people I trust and respect, and gold is hated by many people I don't trust or respect.

Perhaps you should learn to think for yourself instead.


On Nov 02 03:16 PM obewon wrote:

> Good points, Tipalia.
> Nadler's best points are twofold: first, gold is money. Second, be
> "sensible" about gold investing. Do not have a very large percentage
> of your money into gold.
>
> Here's my take on Nadler's commentary:
> 1. Some good points therein, though he presents a very unbalanced
> case.
>
> 2. He's an employee of Kitco (a positive), but he's a PR guy (a negative),
> not a world-class investment guru like Marc Faber, or Martin Weiss,
> or Paul Tudor Jones, or John Mauldin. All of the guys I just mentioned
> are bullish on gold.
>
> 3. I've never trusted PR guys because they're like used-car sales
> people. Can I trust what he is saying (... I've heard that they have
> shorted the gold price), or is he just "talking his book" ? Or would
> I rather trust what Faber, et al are saying? At the end of the day,
> it's guys like Faber, et al, who have a reputation that they must
> uphold.
>
> 4. There are many other factors that Nadler did not mention, yet
> they also have a big influence on the gold price.
>
> 5. Barrick & JPM have had a cozy relationship over the past 10
> years... yet the king of the gold shorts is JPM. And look at the
> financial problems that Barrick (ABX) is now in, because they excessively
> hedged their gold production at the suggestion of JPM.
>
> 6. JPM currently has a net short position of over 25 million oz.
> and has tremendous influence over firms such as Kitco and Barrick.
>
>
> At the end of the day, I'll take Faber, et al over Nadler.

Economists' Surveys Say... Why Are We Still Listening to Them?

Yes, don't listen to the economists!

But, you, YOU my friend, now you should definitely be listened to as you are the exception that confirms the rule.

Right?

Investing in Gold Now

Forget sorgmot. He was probably shouting this bullshit twenty years ago and he'll still be shouting it twenty years from now.

You can find people like him going all the way back to the 1930s.

The Top 20 Game Publishers

ATVI has twice the revenue of ERTS, yet shows below it. AFAIK ATVI (and especially Blizzard) doesn't have such bad review scores to compensate ignoring the doubling of revenue - so this list seems very quirky indeed.

This is good to sell magazines, not useful as investment data.