Donkey Kong

Donkey Kong
Send Message
View as an RSS Feed
  • 38 Reasons the Google IPO Isn't the Big Deal Some Are Making It Out to Be  [View article]
    The breathless news-readers at CNBC are all excited with GOOG up over 400% since the IPO. Impressive absolute performance, but not so great relatively speaking.

    On the 5th year anniversary of going public, MSFT was up over 1300% or a compound annual return of over 70%. So, it fair to say that MSFT was a much more dominant franchise in its first five years of public ownership than GOOG. Certainly, investors thought so.
    Aug 19, 2009. 07:42 PM | 7 Likes Like |Link to Comment
  • Consumer Bankruptcy Filings Hit 4 Year High  [View article]
    Is this your CNBC casting call?

    On Aug 10 05:21 PM Jack FghtClb wrote:

    > I think historians will use a 'mo' prefix to the -ron used to describe
    > you.
    > Relative public debt to most economic indicators are at higher levels
    > but within normal ranges. And the consumer has seen benefits of
    > a 50% increase in the SPX - spell it with me f-e-e-d-b-a-c-k...c-y-...
    > Unemployment is l-a-g-g-i-n-g.
    Aug 11, 2009. 08:56 AM | 3 Likes Like |Link to Comment
  • Who's Blowing This Bubble - And When Will It Pop?  [View article]
    "Don't look now, but the discount rate is awfully low. You guys took math, right?"

    When you use a low discount rate, by definition you are receiving a low return. I thought the idea was to generate HIGH returns, Mr. Math?

    On Aug 07 07:44 PM Deepv wrote:

    > Where is the bubble? dell on 10x earnings? China -- fine. Show me
    > the bubble! I thin you all need to get a grip and learn stock = PV
    > of future cashflows. Don't look now but the discount rate is awfully
    > low. You guys took math right?
    Aug 8, 2009. 06:22 PM | Likes Like |Link to Comment
  • Confidence Games and Ponzi Schemes: No Way to Run the World's Largest Economy  [View article]
    I don't disagree. See my post about SAVERS, SPENDERS and INVESTORS / SPECULATORS. By definition, the Fed with the support of the U.S. Government "hate / don't respect" SAVERS given their zero interest rate policy. SAVERS include the thrifty, people on a fixed income, etc. Artificially low interest rates are to the benefit of SPENDERS (to finance their over-consumption) and INVESTORS / SPECULATORS (to finance their investments / boost the value of their holdings). If you live within your means, eschew debt and save for the future, why should you have to finance the indulgences of the SPENDERS and INVESTORS / SPECULATORS? Fed and U.S. Government policies should be fair and balanced towards all three groups. This is the only way we can have a long-term, sustainable recovery.

    On Aug 07 07:27 AM Michael Clark wrote:

    > Very good article, Tim. Notice the chart on the savings rate: interest
    > rates started down in 1983 and never came back up. How can we expect
    > people to save when they are getting nothing from the banks in terms
    > of interest and our 'leaders' in Washington and New York are doing
    > all they can to debase the dollar?
    > This crisis has exposed a lot of lies and corruption. And, as you
    > suggest, the cat is out of the bag: the management of the economy
    > and finance through Wall Street and the Fed is just another PONZI
    > scheme, with more pomp and better rhetoric.
    > Wall Street is just another form of Caesar's Palace, without the
    > naked women.
    Aug 7, 2009. 08:59 AM | 6 Likes Like |Link to Comment
  • Abby Joseph Cohen's Bullish Calls  [View article]
    When I think of Abby Joseph Cohen, I think of the phrase..."even a broken clock is right twice a day".
    Aug 7, 2009. 08:45 AM | 5 Likes Like |Link to Comment
  • Five Reasons the Market Could Crash This Fall  [View article]
    The 50% rally from the March lows is not surprising at all. Given the unprecedented levels of debt in the system (public and private) and the threat of insolvency, the world was headed towards Armageddon. Therefore, the Fed and U.S. Government decided the only way to avert disaster was to boost ASSET VALUES! Everything else is secondary. So, what's the best way to boost asset values? Massive fiscal and monetary stimulus!

    In my mind, there are three groups of people in the world: SAVERS, SPENDERS and INVESTORS / SPECULATORS. SAVERS put money into CDs, savings accounts, etc., refrain from leverage and focus on living within their means. The Fed and the U.S. Government are essentially saying f*** you to SAVERS by keeping short-term interest rates artificially low. Monetary and fiscal policy is unfairly skewed to the benefit of SPENDERS and INVESTORS / SPECULATORS. These groups can borrow cheaply (at the expense of SAVERS) to finance their consumption (SPENDERS) and to boost the value of their investments (INVESTORS / SPECULATORS). Much of the growth, consumption and investment returns since the early '80s was due to increasing amounts of leverage. The U.S. will not return to steady, sustainable, long-term until Fed and Governmental policies are equally fair to SAVERS, SPENDERS and INVESTORS / SPECULATORS.
    Aug 5, 2009. 09:04 PM | 8 Likes Like |Link to Comment
  • Huron Consulting's Spectacular Blow Up  [View article]
    Growth by acquisition strategies or "roll-ups" ALWAYS end badly....

    On Aug 04 08:40 AM Alan Brochstein wrote:

    > Tyler, interesting take, but I am not sure it is correct. From what
    > I understand, the selling principals moved money directly to their
    > underlings rather than receiving it, paying taxes and then doing
    > whatever they wanted. HURN didn't benefit from this as far as I
    > can tell. Worst case, the spread between GAAP income and non-GAAP
    > income would have been wider, but it certainly didn't do anything
    > to alter "organic growth" perceptions. It was a roll-up, period.
    > Nevertheless, it isn't something that will help them gain new clients,
    > will it?
    Aug 4, 2009. 09:26 PM | Likes Like |Link to Comment
  • Goldman Sachs (GS) upgrades 3M (MMM) to Buy from Neutral, sending shares up 2.4% premarket. Goldman likes 3M's significant exposure to early cycle auto and consumer electronics markets.   [View news story]
    Congratulations on missing the move from $41 to $71......
    Aug 3, 2009. 08:38 AM | 3 Likes Like |Link to Comment
  • The Fallacy of 'Money on the Sidelines'  [View article]
    Excellent article! It supports the simple financial premise: leverage magnifies returns - a huge stimulant when asset values are increasing and the proverbial weight around your neck when asset values are in decline.

    Jeremy Grantham stated that in December 2008, the world had $50 trillion in assets at the peak which was supported by $42 trillion of leverage (80%). He believes the max leverage ratio should be roughly 50%. With asset values at roughly $35-40 trillion, leverage still needs to come down by roughly half. This does not bode well for the global economy, equity markets, etc.
    Aug 2, 2009. 08:21 PM | 6 Likes Like |Link to Comment
  • The Bears Capitulate  [View article]
    contrarian SIGNAL...

    On Jul 30 08:35 PM Donkey Kong wrote:

    > Reminds me of the BusinessWeek cover from August 1979, "Death of
    > Equities". This was the ultimate contrarian single and I wouldn't
    > be surprised if the Newsweek cover will be as well.
    Jul 30, 2009. 08:35 PM | Likes Like |Link to Comment
  • The Bears Capitulate  [View article]
    Reminds me of the BusinessWeek cover from August 1979, "Death of Equities". This was the ultimate contrarian single and I wouldn't be surprised if the Newsweek cover will be as well.
    Jul 30, 2009. 08:35 PM | 1 Like Like |Link to Comment
  • Forget the 1930s; We're Reliving 1975 (Part II)  [View article]
    Great high-jump analogy! I always say "grading on a curve", but yours really gets the point across. It's ridiculous to hear the idiots on CNBC talking about the "profit surge".

    On Jul 27 12:20 PM Larry House wrote:

    > NOTHING is to be learned about the present by looking at the past.
    > That is not my idea; it is straight from the noted value investor
    > Benjamin Graham. By the way, I haven't seen any "surging profits."
    > If you set a bar at one foot high and clear it by a foot, does that
    > make you a great high jumper? Let's get real, folks.
    Jul 27, 2009. 06:16 PM | 9 Likes Like |Link to Comment
  • It's not just you: Yes, every firm seems like it's beating expectations.   [View news story]
    Just like grading on a curve - you think your Einstein because you got a 50 on the exam while all your classmates got 40 or less! A less flattering term is the "we suck less" defense. The market is about expectations, but the ABSOLUTE results and comparisons cannot be ignored....
    Jul 21, 2009. 06:54 PM | 1 Like Like |Link to Comment
  • The Whitney Whiplash  [View article]
    Agree there is a disconnect between what bond markets are saying vs. equity markets. In general, bond investors are much more savvy than equity investors. Bottom line - you can't have plunging US Treasury yields with a soaring stock market.

    On Jul 13 07:14 PM dcb wrote:

    > treasuries hit s new low today, so the bond market is saying something
    > different than the stock market. why?
    > bond market says further trouble ahead, and this is bounce. I have
    > no idea of that is true, but when something moves and lacks confirmation
    > I wonder. Also bonds move stocks, not other way around (usually)
    Jul 13, 2009. 08:56 PM | Likes Like |Link to Comment
  • ETFOX: The ETF Mutual Fund That Continues to Outsmart the S&P 500  [View article]
    Who cares if ETFOX continues to "outsmart the S&P 500". The SPX is not meaningful benchmark to ETFOX given its concentrated sector holdings in primarily growth and small cap stocks, including leveraged ETFs.
    Jul 2, 2009. 07:18 PM | Likes Like |Link to Comment