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  • Second Quarter 'Hiccup' On The Way  [View article]
    Heard it three times on CNBC (yeah, I know it was CNBC) on Friday. Two of the comments came from guest interviews and did not bother to go into other room and see who was speaking. Do remember that the last time I heard it was after market closed and it was "Art Cashin" (UBS Director of Floor Operations at the NYSE) making the comments, and he also said they were waiting for data to verify those thoughts.

    Have no idea on the veracity of comments - that was why I was asking what Brett had heard on the matter.
    Apr 15, 2013. 01:23 AM | Likes Like |Link to Comment
  • Second Quarter 'Hiccup' On The Way  [View article]
    Actually, I was referring to the Stock Market.
    Apr 14, 2013. 09:29 AM | Likes Like |Link to Comment
  • Second Quarter 'Hiccup' On The Way  [View article]
    Heard recent observations that a good deal of new money (lately) has come in from Europe, and now even from Japan (and to a lesser extent other Asian countries). Have also heard people were waiting for data to verify above observation. Have you heard anything?
    Apr 13, 2013. 11:36 PM | 1 Like Like |Link to Comment
  • Goodyear Tire & Rubber (GT -3.4%) and Cooper Tire & Rubber (CTB -2.8%) trade weak after KKR buys a majority stake in Alliance Tire Group to send some shockwaves through the sector. The companies are also feeling some heat from a push higher in rubber prices.  [View news story]
    "The companies are also feeling some heat from a push higher in rubber prices."

    What, off the lows? Rubber spot prices are 52+% off their 2010 highs and 26+% cheaper than 2012 highs. The prices have been in a relatively tight range since Aug 2012, and are currently in the bottom third of that range.

    There may be constraining factors in the tire industry - but rubber price is not one of them - just shoddy reporting from Bloomberg (in the link from news blurb).
    Apr 13, 2013. 11:05 PM | Likes Like |Link to Comment
  • Weighing The Week Ahead: A Seasonal Soft Patch Coming?  [View article]
    Much better, and I get your point.

    The fall off in M1 and M2 has not been that dramatic since 12/31/12. But by your first post it looks like you expect that fall off to accelerate in April going on through the summer?
    Mar 31, 2013. 05:12 PM | Likes Like |Link to Comment
  • Weighing The Week Ahead: A Seasonal Soft Patch Coming?  [View article]
    Well said.
    Mar 31, 2013. 03:57 PM | Likes Like |Link to Comment
  • Weighing The Week Ahead: A Seasonal Soft Patch Coming?  [View article]
    "Widespread FDIC insurance coverage expired on 12/31/2012."

    I am guessing you mean unlimited coverage expired. Current level of coverage is $250,000. However, there are ways to increase the coverage in a single bank:

    "You may qualify for more than $250,000 in coverage at one insured bank or savings association if you own deposit accounts in different ownership categories. The most common account ownership categories for individual and family deposits are single accounts, joint accounts, revocable trust accounts, and certain retirement accounts."

    Really seems difficult to believe that this had much of an effect on capital markets.

    Note: If you are trying to inform people - you might want to tone down your technical language. If not, then carry on :)
    Mar 31, 2013. 03:56 PM | 1 Like Like |Link to Comment
  • Weighing The Week Ahead: A Seasonal Soft Patch Coming?  [View article]

    Great links this week - especially Alan and Jeff's work.

    Has anybody (media) held ECRI's feet to the fire on their calls, and are they still calling for a recession albeit pushed out far from their original time frame? (As you know, I have always been solidly in your camp of "recession thinking" since joining your discussions the last year.)

    Regarding negative pre-earnings announcements: If the overall market is trending higher than it seems the wisest course is to pick companies that are showing solid YOY revenue and earnings growth. Those companies tend to have a run-up into earnings or a nice pop after earnings as the YOY trend is confirmed. In addition if those companies pay dividends,have the ability to increase dividends, and do implement dividend (annual and special) increases - all the better. Selling calls to enhance yields on portfolio - as you suggest - also makes for a happy investor.

    NOTE: individual stocks - have missed out on big moves by high beta (very) high P/E stocks. However, am willing to take that hit as corrections to those names on bad individual company news or general market corrections is just to tough to stomach at my age.
    Mar 31, 2013. 10:53 AM | 1 Like Like |Link to Comment
  • Why Not Invest In Stocks?  [View article]
    "It cannot be defined in terms of perceptions about the Fed, as you are doing. It has to be about data."

    Could have said when the FED starts tightening again or announces the end of QE, but the move in 10 year rate will happen before those clearly identifiable events. Really no way to quantify my position (that I can see) - and probably falls under the category of the "art" of investing vs. the science of investing. So...will probably have to have that dinner on just a social basis on my next trip to the "windy city".

    Understand the curvilinear relationship position in that the market goes up during the initial period of rising interest rates - better economy, reflated assets, earnings growth, etc. From your past charts and other research the sweet spot for multiple expansion would be in the 4.5 to 5.5% range on the 10 year yield with deterioration in P/E multiples becoming evident and possible over 5.5%.

    To clarify: am 85/7% in equities/bonds, and when I say mostly out of stocks my blend in portfolio at the 3% 10 year yield range would shift more to the standard age model for me: 40% stocks and 60% bonds minus some amount of cash. Given my risk tolerance and knowledge of markets more than likely I would cheat a little higher on the equity side but keep it under 50%.

    3% indicator may be wrong as the relationship may have broken down in this extended ultra low interest rate environment. However, at my age and with my now substantial asset base (well considerably better than average) - need to be more protective of holdings. This would not preclude me from being very aggressive in my separate and fairly sizable trading account (short and long) in any environment.
    Mar 31, 2013. 09:25 AM | Likes Like |Link to Comment
  • Why Not Invest In Stocks?  [View article]
    I agree with Brian regarding trough.

    Dancingdiva may have been talking about forward earnings estimates, and this goes back to his and my exchange a few weeks back. DD uses the S&P site and their forward estimates are radically different (whatever the reason) from your sources and any analyst that I follow.

    Finally - "As these abate, interest rates will move toward 4% on the ten year note and multiples will return to more normal levels (in forward terms)."

    I agree that as the doom and gloom forecasts prove inaccurate the multiples will probably expand on the stock market. However, NO WAY the ten year sees anything close to 4% without the persistent perception that the FED is getting ready to stop the easing. Will gladly wager a dinner at one of Chicago's finest restaurants on this - and will gladly fly up there to pay up or collect.

    In addition if the ten year gets anywhere near three percent that would trigger one of my most reliable indicators to get out of stocks (mostly) and back into bonds.
    Mar 30, 2013. 09:09 PM | Likes Like |Link to Comment
  • Weighing The Week Ahead: Can The Cyprus Fallout Be Contained?  [View article]
    A year or two or three from now - we will be saying "Cyprus who?". Europe stocks were at high levels and I would ascribe the poor pmi numbers more than Cyprus to their pullback - which has not been that bad. Euro is trading like a currency with problems - but again think pmi numbers are more to blame than Cyprus. What periphery debt? Yields look fine to me in major countries and also in Italy and Spain.

    Our yields are dropping - I guess because they are considered safe haven. Are the Russians buying our bonds? :) Have to remember a few weeks ago people were touting a breakout of U.S. ten year to push the mid 2's% - and so it is back to where they were a month ago. Money still not racing from bonds into the stock market.

    I will stick with Cyprus as a non-event IN THE U.S. and for our markets. Do not have any money in Cyprus , nor much exposure to Europe (except U.S. multinationals) - so....... that does not mean Cyprus will not be used as an excuse to sell-off - but so far the sell off has no steam.....
    Mar 27, 2013. 06:29 PM | 1 Like Like |Link to Comment
  • Weighing The Week Ahead: Can The Cyprus Fallout Be Contained?  [View article]
    How so?

    Am 95% (w/ 7% individual bonds) invested with 5% cash and 1 S&P put in case there is one dramatic down day. Thiazole and I agree: that IF there is a pullback it will be a mild one, but I also said - "or more probably a break to the upside." Just not as sure on this as I have been in the past. Wall of Worry thing :)

    My main question was: Cyprus -"what fallout?" Thought it was a non-event, and that is what you seemed to be saying, but just trying to reconcile headline with your conclusions.
    Mar 26, 2013. 06:35 PM | 1 Like Like |Link to Comment
  • Weighing The Week Ahead: Can The Cyprus Fallout Be Contained?  [View article]

    Cyprus - my question is "what fallout?" It seemed like your comment was that any sell off on Cyprus news that causes a market pullback is a buying opportunity?

    Cyprus seems to be a very unique situation where past methods of Euro-managing do not apply. So, last week I added on weakness to stocks with confirmed growth trends and weakness in hybrid mreits, trimmed some stocks that were past my valuations, and sold some calls on existing positions. Guess I am trading water here.

    A bright spot: The S&P has been treading water since March 8th. The markets do not usually give one this much time to get out before a NASTY correction - so I am expecting a mild pullback or more probably a break to the upside. Guess I agree with Felix.
    Mar 25, 2013. 08:05 PM | 1 Like Like |Link to Comment
  • US Airways Investors Hoping For Merger Bailout May Be Disappointed  [View article]
    "I'm not sure there's any point in discussing this further. My airline investments as a whole (HA and DAL) outperformed LCC since July 13, and since this article was published in early December. But there's nothing wrong with us both making money!"


    But our friendly exchange was not about HA "AND" DAL it was about HA and LCC head to head from 7/13, AND the caveat was always there to trade around the position - but that was not the comparison agreed upon...... but as you said it is cool that we can both make money even when we disagree on investments. I did appreciate your columns because it gave me a chance to see the short side thesis thoughtfully written out. Good luck on your "fool" writings.
    Mar 23, 2013. 05:13 PM | Likes Like |Link to Comment
  • US Airways Investors Hoping For Merger Bailout May Be Disappointed  [View article]
    "but I would still argue that my thesis was correct."

    Given our exchanges - I would expect nothing less.

    "So what's happened is simply that the valuation of the entire industry has gone up."

    I agree and we communicated about that perhaps being a factor for expanding multiples.

    "don't see how I could have an "inherent bias" against the stock"

    Seriously? Forget the "ticking time bomb" comment in Dec. regarding LCC. It goes back to your July 13th article on HA and our exchanges. If I wanted to be a jerk I would ask for a comparison of those two since 7/13/12. You always had LCC at the bottom of your airline list and as something you did not want to put your money in - and I have no problem with that - as there are many fish in the sea. However, it was not the fact that it was on the bottom of your list - but your analysis was: it was not going to do well and even may go down in price. That would not even be bothersome except you had blinders on to any of the positive points about LCC. You are not stupid - actually quite smart intellectually - so the blinders have to be the result of an inherent bias.

    I'll smoke a cigar and drink a rare glass of wine on the day I pull off the five-bagger in LCC (this year) and toast your name.
    Mar 22, 2013. 10:26 PM | Likes Like |Link to Comment