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  • Less-than-$50 oil will change the world, economists say [View news story]
    "They are a once-in-a-generation shock and will have huge reverberations."

    Ken Rogoff either has less than 10 years in the business, or is a complete idiot.
    Jan 7, 2015. 10:56 AM | 7 Likes Like |Link to Comment
  • Germany prepared to let Greece leave euro zone [View news story]
    Hahahahahha! This is hilarious!

    Tsipras spent most of the time during his latest speech talking exactly about how he does NOT intend to leave the Eurozone!

    Politics man.... The Germans know what Tsipras' position is and they feel comfortable coming out in support of a Grexit that will never happen.

    Man I hope they force the issue and a Grexit happens, Greece is screwed if it stays. And can tell everyone to screw off if it leaves.
    Jan 4, 2015. 07:38 AM | 7 Likes Like |Link to Comment
  • Bottom-fishing in energy sector [View news story]
    Oil still expensive on a BTU basis and Al-Naimi came out and said point blank SA will push oil to $20 if it has to in order to retain marketshare and squeeze out high cost producers.

    The bottom isn't in on crude. Finding alpha in the sector will be tricky and ETFs will likely get hammered.
    Dec 30, 2014. 10:15 AM | 7 Likes Like |Link to Comment
  • While there are "dark warnings" that the U.S. is becoming like Japan, what's wrong with that? asks Zachary Karabell on Reuters. Sure, Japan has "chronic deflation, a sluggish job market, an aging population, an insular culture and (stagnant) growth." But its citizens are are prosperous and healthy, and have a high life expectancy, "democratic government is orderly and ordered," and the country has an efficient bureaucracy. [View news story]
    What's wrong is that our economy may enter a deflationary cycle like Japan's but in the end, we aren't Japan.

    Our healthcare, tax collection, monetary policy, defense budget, energy profile, natural resources, population density are very different and the end result of entering into a Japanese style malaise may not have us end up in Japan's shoes.
    Feb 24, 2013. 08:46 AM | 7 Likes Like |Link to Comment
  • The CME cuts the initial margin for gold (GLD) to $5,940 from $6,600 and silver (SLV) to $10,450 from $12,100. Maintenance margins are cut by a similar ratio for both metals as well. [View news story]
    This pertains to trading in Futures contracts. Futures contracts are a way of making bets directly on the underlying product, which in this case is gold.

    If we take the gold contract specifically, a single contract reflects "100 troy ounces" which, when you buy the Futures contract, you are making a commitment to purchase in its entirety on the expiration of the contract. Since the actual value of 100 troy ounces is rather significant, you can see how this may be a problem for most folks.

    However, in many cases, speculators trade the contracts without any intent of actually taking delivery. Because the contract reflects such a large amount of product, it provides rather a lot of trading leverage to help one make - or lose - money rather quickly.

    When you take a position on a futures contract, the CME requires you have a certain amount of cash set aside as insurance, since it is a risky, highly leveraged, trading vehicle. This cash is referred to as 'initial margin' for your initial opening of your position.

    In this case, the CME margin used to be $6,600 but was reduced to $5,940.

    Why this is important:

    Trading brokerages will often have their own margin requirements for traders, who tend to day trade futures, but the CME's margin requirement is important for anyone who wants to hold a contract after the market 'closes'. When markets 'close' , anyone with an open position in futures has to have enough margin money to cover each contract. In this case, for gold if you had 10 contracts you needed $66,000 worth of margin cash in your account to maintain the position on the 10 contracts. The total amount of 'open' contracts held after market close in a future is called 'open interest'.

    That's been changed to $5,940/contract, or $59,400 for ten. This effectively frees up $660 per contract, allowing you to invest it elsewhere, perhaps in taking a larger position.

    The CME claims it adjusts margin based on volatility in the futures market, reducing margin when volatility is low and increasing margin when volatility is high. You'll find rather more sinister opinions around the internet, but it seems to work that way for the most part.

    The end result of decreasing margin tends to be more trading in the product, more 'open interest', more fees collected for CME. It also seems that low volatility + reduced margin often results in the future getting bullish, which may happen here, but no one can predict market movements with perfect accuracy so be careful.
    Feb 8, 2013. 03:42 PM | 7 Likes Like |Link to Comment
  • Nokia (NOK +0.2%) will post a €0.25/share loss next year after losing €0.34/share this year, predicts BMO's Tim Long, who's downgrading shares to Underperform and valuing the company at just $2/share (purely on account of its cash and patents). Long predicts Nokia's Lumia phone sales will come in at a disappointing 20M in 2013, a figure that will fail to offset an expected 15% drop in industry feature phone sales. (prior downgrades[View news story]
    "a figure that will fail to offset an expected 15% drop in industry feature phone sales"

    Should we take him seriously when he doesn't state where this 15% drop is coming from? I suspect he is extrapolating prior share losses of featurephones to smartphones forward, but that number seems huge, and without any support to the comment, I'm inclined to write off his opinion as abject guessing.

    I think Nokia is going to catch a lot of these 'analysts' by surprise. Yes, I'm long Nokia.
    Sep 25, 2012. 11:49 AM | 7 Likes Like |Link to Comment
  • The first reviews for the Tesla (TSLA) Model S start to pour in, largely on the positive side. The electric vehicle boasts impressive acceleration, a smooth ride, and a massive infotainment system chock full of delights, according to the writers. With demand for the model uncertain, and its success seen as an all-or-nothing watershed moment for the company, early buzz on the car is viewed as critical. (Reviews: Engadget, Motor Trend, Wired, CNET[View news story]
    The S has a range of 260 miles, well under the average US commute.

    Charging tech is far more advanced than you realize with 15min recharges to 80% capacity already available.

    Charging stations - and mobile phone 'apps' to find them - are popping up everywhere. It doesn't take much planning to perform long range trips on electric power anymore.

    Most of the free recharge stations in my area are always occupied, and the private sector is filling the need for more every day.
    Jun 23, 2012. 10:34 AM | 7 Likes Like |Link to Comment
  • The Reagan tax cuts, still controversial 30 years after being signed into law, were highly stimulative, but only because the economic circumstances of the time - high inflation, high tax rates - made it so, Bruce Bartlett writes. Reenacting some version of the tax cuts under today’s conditions - near-zero inflation, low tax rates - would not bring about similar results, he says.  [View news story]
    He means that that folks won't be spending more because of a tax cut since they don't pay any taxes now anyway since they don't make enough money to since the economy sucks.
    Aug 15, 2011. 06:29 PM | 7 Likes Like |Link to Comment
  • Geithner says "we're running out of time" to raise the debt ceiling. Bernanke says failure would be "calamitous." Pres. Obama says seniors might not get Social Security checks without a deal. But, Kurt Brouwer asks, isn't this the same gang who said TARP, the stimulus, Obamacare, QE1 and QE2 would fix things? Is it any wonder that Americans "just do not trust our leadership anymore?"  [View news story]
    Politics are so polarized in the US I got int'l friends and associates calling me up asking what is going on. Everyone wants to know if the US will default and what the repercussions will be on their own sphere.

    Basically, the rest of the world is already panicking, and we aren't anywhere closer to resolving the issue.
    Jul 14, 2011. 06:32 PM | 7 Likes Like |Link to Comment
  • Just wait for Q2 earnings, optimists said back in June - and after an ugly jobs report, bulls are doubling down on that hope. But estimates are down 4.3% from a May 13 peak, Dave Kansas notes, and financials could be especially disappointing; maybe too much pessimism has become too much sunshine. Still, won't it make earnings surprises more likely?  [View news story]
    With purchasing power and wages down while jobs are not being created, it's hard to be optimistic on many sectors of the economy.
    Jul 9, 2011. 08:50 AM | 7 Likes Like |Link to Comment
  • Inflation? Just look at the deflation all around you - cars, clothes, home energy, hotel stays, furniture and appliances, electronic gadgets of all kinds. "There's no grand conspiracy to keep the headline number down," Matt Busigin writes.  [View news story]
    my rents are going down - middle/working class tenants and seniors. I'm experiencing deflation but somehow all the numbers out there claim rents going up... housing costs are declining in every space in my opinion.
    May 20, 2011. 06:10 PM | 7 Likes Like |Link to Comment
  • House Speaker John Boehner raises the bar in talks over the U.S. debt ceiling, telling the Economic Club of New York that spending cuts must exceed any boost to the borrowing limit. Also, "raising taxes is off the table" because it would "have a devastating impact on our economy." The debt limit debate in Congress is now seen as stretching into July.  [View news story]
    Which part is political posturing and which part honest discourse...
    May 10, 2011. 10:06 AM | 7 Likes Like |Link to Comment
  • Chesapeake Energy (CHK) says workers have stopped the flow of drilling fluids from a natural gas well in Pennsylvania that leaked the chemical-laced water for two days. Critics say hydraulic fracturing - "fracking" - could poison water supplies; the company claims the incident posed "minimal" environmental impact.  [View news story]
    Right because exaggeration and parody are clearly the hallmarks of intelligent discourse.
    Apr 22, 2011. 12:15 PM | 7 Likes Like |Link to Comment
  • Research from Bloomberg New Energy Finance suggests large solar-panel projects may surge over the next two years - with prices competitive with coal, and dropping by 50% to $1.45/watt to build by 2020. "We are already in this phase change and are very close to grid parity," says one CEO.  [View news story]
    The economics of renewables differ vastly from those of coal, or other consumables. There's a strategy. Renewables create productivity in the economy because the cost is one off.

    Additionally, please stop the obfuscation, oil and coal are big beneficiaries of government subsidies.
    Apr 6, 2011. 12:04 PM | 7 Likes Like |Link to Comment
  • Research from Bloomberg New Energy Finance suggests large solar-panel projects may surge over the next two years - with prices competitive with coal, and dropping by 50% to $1.45/watt to build by 2020. "We are already in this phase change and are very close to grid parity," says one CEO.  [View news story]
    Wow 1) try reading the article, 2) disturbing lack of knowledge and interest in obtaining knowledge in your comment.

    The point being made is the watt for watt PRODUCED, if you don't understand that I can try and explain, solar is getting to the point where it will be cheaper than coal.
    Apr 6, 2011. 11:41 AM | 7 Likes Like |Link to Comment