Why It's a Good Time to Short Netflix [View article]
Hi David,
First off I have to say I like your writing and your articles however I have to comment from a technology standpoint (I work in IT).
I don't feel that bandwidth is really an issue; First off the sustained stream speed is actually relatively small compared to the pipe coming in. 50kB/s will sustain reasonable video plus audio can be compressed down to 22k. If you include buffering and variable resolution this would handle variance in pipe speeds. Also I would imagine Netflix has decentralized architecture with tiered caching so any pipe going across continents won't really effect it; nether will any backbone issues.
The basic thought is that if the individual can get Digital Tv then they can get NetFlix.
I think all of your other points are very valid regarding technical indicators and this pig is overvalued relative to the market. Plus given the profit they are getting and the low startup cost (relative) I would only expect some of the heavyweights will move in on the market pretty soon (FYI concept to completion would take about a year for a company with reasonable infrastucture resources). I dont think much value can really be assigned to the brand.
However, I think there are still new users that the company can reach; if not the same users but through different content mediums.
The thing to keep in mind (and what a lot of people are missing) is that everything in IT is deflationary, this company wont be dominent forever. Unfortunately, there is a bit of an investor cult around it so timing will be tough (you can even tell by the replies your getting).
Critical Clues from Forex Traders About the U.S. Market Rally [View article]
Deflation.
On May 21 03:59 PM Nathaniel C wrote:
> Why is the Yen considered safer than the dollar? Japan has more debt > as a percentage of GDP than the US and comparably low interest rates. > I actually think the Aussie is a better currency to own than the > dollar or yen.
Decline in Jobless Claims Implies End to Recession [View article]
I think this is interesting however one has to wonder what effect the govnt/bailout is having on these numbers. Similar to the bush stiulus cheques bumping up the GDP and "avoiding" a technical recession for another few months. I think the next coming weeks will be telling once the automakers failures come into play. Though I guess I say that every week "next week will be very telling" :P
If you read Cetins blog (I force myself to read both sides... *sigh*) you'll see that he has held on to the same picks since 2007.... therefore after all these events unfolded he still hasn't changed his outlook. This says to me that his investments are deciding his economic outlook... rather then the other way arround.
Market Signals That the Economy Is Not Collapsing [View article]
Personally anyone that refers to people that take short positions angrily and saying there "unpatriotic" is instantly discredited. Shorting is a tool in the toolbox; nothing more. The second you fall in love with any position your basically just touring the casino. Heven forbid the day Cetin discovers the options. I'm sure the concept of going both long and short will make his head explode.
Just for fun where did you get $250 sp projection (~+50%) from?
Personally i think MA will be in the penalty box for a while as the full bredth of consumer pain continues including cleaning up housing balance sheets. As well, given the nature of this downturn I would see credit card companies as having large political risk right now. Personally I think it would be locked in a range for a while until savings rates decrease. I'd be interested to hear other ideas on this though.
On Apr 27 03:57 PM chrismatthewsisashill wrote:
> Considering estimates are for $12.00 for 2010 do you think MA warrants > a PE over 20 or do you think earnings estimates are too low? Personally > I see some bearish technicals so am debating putting on a short position. >
Is It Possible the Current Recession Was Caused by Oil Prices, Not Housing? [View article]
Could it be that the oil prices helped cause the first few chains of defaults in the housing market with the purchasers that were overleveraged. Aka oil was the match housing was the gasoline :P
Realistically no one thing can really be attributed to the decline. So many aspects of the economy had turned unhealthy at once.
@Cetin "mostly profit taking"
Really?!? You believe a 56% drop is "profit taking"?
personally I would avoid Sandisk simply because there markets have become very commotitized with to many participants. I'd love to hear other peoples thoughts on this though.
no kidding eh, and why post on *every* article... it gets irritating reading through an article with some great ideas then getting to the bottom and seeing someone heckling the writer who was kind enough to post the article.
cetin show some respect to people... you already have a site all about you.
This Spring Fling Could Become a Summer Bummer [View article]
" If the savings rate doubled to 8% you think that would be good for the economy?"
Sort term yes it would hurt but long term it would alow growth on a more sustainable foundation. The question is would the consumer choose to better themselves on a micro scale or the economy on a macro scale. I'm pretty sure they would better themselves first regardless of the implications aka saving more. I also think this is almost forced with huge dept ratios and negative equity.
Why It's a Good Time to Short Netflix [View article]
First off I have to say I like your writing and your articles however I have to comment from a technology standpoint (I work in IT).
I don't feel that bandwidth is really an issue; First off the sustained stream speed is actually relatively small compared to the pipe coming in. 50kB/s will sustain reasonable video plus audio can be compressed down to 22k. If you include buffering and variable resolution this would handle variance in pipe speeds. Also I would imagine Netflix has decentralized architecture with tiered caching so any pipe going across continents won't really effect it; nether will any backbone issues.
The basic thought is that if the individual can get Digital Tv then they can get NetFlix.
I think all of your other points are very valid regarding technical indicators and this pig is overvalued relative to the market. Plus given the profit they are getting and the low startup cost (relative) I would only expect some of the heavyweights will move in on the market pretty soon (FYI concept to completion would take about a year for a company with reasonable infrastucture resources). I dont think much value can really be assigned to the brand.
However, I think there are still new users that the company can reach; if not the same users but through different content mediums.
The thing to keep in mind (and what a lot of people are missing) is that everything in IT is deflationary, this company wont be dominent forever. Unfortunately, there is a bit of an investor cult around it so timing will be tough (you can even tell by the replies your getting).
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The Citigroup Anomaly Lives On [View article]
Critical Clues from Forex Traders About the U.S. Market Rally [View article]
On May 21 03:59 PM Nathaniel C wrote:
> Why is the Yen considered safer than the dollar? Japan has more debt
> as a percentage of GDP than the US and comparably low interest rates.
> I actually think the Aussie is a better currency to own than the
> dollar or yen.
Decline in Jobless Claims Implies End to Recession [View article]
The Shrinking American Consumer [View article]
Options Trader Tuesday Outlook: Double Top? [View article]
These articles you do every morning are great; I've been following for quite a while now.
Wall Street Breakfast: Must-Know News [View article]
So true!
Market Signals That the Economy Is Not Collapsing [View article]
John Hussman: It's Not Over Yet [View article]
Personally i think MA will be in the penalty box for a while as the full bredth of consumer pain continues including cleaning up housing balance sheets. As well, given the nature of this downturn I would see credit card companies as having large political risk right now. Personally I think it would be locked in a range for a while until savings rates decrease. I'd be interested to hear other ideas on this though.
On Apr 27 03:57 PM chrismatthewsisashill wrote:
> Considering estimates are for $12.00 for 2010 do you think MA warrants
> a PE over 20 or do you think earnings estimates are too low? Personally
> I see some bearish technicals so am debating putting on a short position.
>
Is It Possible the Current Recession Was Caused by Oil Prices, Not Housing? [View article]
Realistically no one thing can really be attributed to the decline. So many aspects of the economy had turned unhealthy at once.
@Cetin "mostly profit taking"
Really?!? You believe a 56% drop is "profit taking"?
Where's the Tech? [View article]
John Hussman: Wishful Thinking [View article]
cetin show some respect to people... you already have a site all about you.
This Spring Fling Could Become a Summer Bummer [View article]
Sort term yes it would hurt but long term it would alow growth on a more sustainable foundation. The question is would the consumer choose to better themselves on a micro scale or the economy on a macro scale. I'm pretty sure they would better themselves first regardless of the implications aka saving more. I also think this is almost forced with huge dept ratios and negative equity.