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rfernando80

rfernando80
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  • How Much Longer Until Stocks Fall Down? [View article]
    QE was a big PR move by central banks. It was the PR effect rather than the actual cash from it that lifted stocks. 2 trillion dollars of money printing can make scary headlines and makes the retail investor who is fearful of inflation load his portfolio with valueless junk fleeing from an illusory threat. What they do not realize is that 2 trillion is nothing compared to the 60t plus of debt, and that we are in the beginning rather than in the end of a multi decade deleveraging cicle. This is by definition deflationary. QE will stop because it's no longer working. The only solution is to let deleveraging takes it's painful course
    Aug 14 08:10 AM | Likes Like |Link to Comment
  • Buy Broadcom To Enjoy A Profitable Future [View article]
    the market always overreacts to the upside and to the downside. If you do no have the guts to make a leap of faith, you will never make a bargain, i.e. get the most value for you money. If you wait for a lot of evidence before buying, chances are there is not a lot of risk premium left in there as the good news are already priced in, maybe even more than they should. You are buying a great company in the eyes of everyone and all the analysts, but in terms of value for money you are making a loss. Yes, you can be a momentum chaser, but how you determine the time to go out. Flying stocks can destroy years of return on a single day.
    Aug 9 10:32 AM | Likes Like |Link to Comment
  • The Risk That Should Keep VIX Shorts Up At Night [View article]
    I do not know why all focus here is on ETNs and ETNs options. Why not go straight for the real VIX options and futures at the CBOE? You can sell calls and get the double positive effect of contango and time decay, although I woudn't do it right now with the VIX so low.
    Aug 2 04:17 AM | Likes Like |Link to Comment
  • It Is Time To Take Profits In Fertilizer Stocks [View article]
    The best long-term opportunities are when everything is uncertain and everybody is fearful. If you want to be too sure of things, you will almost certainly buy too high. Investing sucessfully requires a leap of faith.
    Jul 31 07:28 AM | 1 Like Like |Link to Comment
  • Just What Is A Speculative Bubble? [View article]
    A good definition of a bubble is when investors stop focusing on buying value and start buying purely because of momentum. I.e. you buy not because there is a decent long-term investment at a reasonable price, but whatever rubbish at whatever price simply because it's going up and everyone else is making money. Notice the difference in stock recommendations from private banks in 2009-10 and now. Back then, the justification was value. Now this argument no longer works because there is no value to be found in stocks so they are focusing on what they cynically call: 'multiple expansion' (the price of rubbish is going up) For anyone thinking there is value in stocks, why is BAC going up at 35 times earnings and 0.27% dividend yield? I will not feel sorry for anybody buying this junk who loses money when it finally crashes. Its the same thing everytime, humans will never learn!
    Jul 23 03:09 PM | Likes Like |Link to Comment
  • Market Outlook: The Calm Before The Storm [View article]
    some great comments here. to the QE crowd: the increased money supply from the FED of 3 trilllion USD is nothing compared to the 60 trillion total USD denominated debt. If you look at the long term-charts, debt growth is faltering in spite of all QE done, lending is not growing, defaults are rising, commodities going down, housing weak, etc... deflationary forces are much stronger than the FED. We are in the middle of a secular deleveraging process, and everyone is chasing returns by buying junk to protect from inflation.. When the herd finally realize this, we will have the final leg of the secular bear we are in. See TIPS spread already trending lower?
    Jul 22 06:37 AM | Likes Like |Link to Comment
  • Cyprus's parliament is due to convene this afternoon to debate an astonishing eurozone demand that it tax all bank deposits at up to 10% in return for a €10B bailout. While approval is not guaranteed, Cypriots rushed to take as much money as allowed out of ATMs. And although EU Commissioner Olli Rehn ruled out a deposit raid in other eurozone countries, menacingly for savers, eurogroup chief Jeroen Dijsselbloem would not. "We are in a new world," says an economist. Update: The parliamentary debate has been postponed until tomorrow. [View news story]
    That's theft, but it reminds us that live is a struggle for survival and one cannot have absolulute faith in any single state or institutions. Instead, if one wants to survive and want to insure the living standards of his offpring for several generations, diversification is key, not only across assets classes, but also among various jurisdiction and ownership structures.
    Mar 17 02:51 PM | 1 Like Like |Link to Comment
  • The CBOE Volatility Index today dropped below 12 for the first time since 2007 and against a long-term average of 20.4. Contrary to what contrarians believe, writes Mark Hulbert, low VIX levels are not necessarily bearish. Thinking about VIX as what it is - a measure of expected volatility - rather than as a "fear gauge" might help do away with this misperception. VXX -2.2%[View news story]
    This market is rallying on ridiculously low breadth and volume, big defensives stocks are leading and cyclicals are taking a beat, and that's all after massive insider selling. Bullishness and complacency everywhere you look. Markets can stay irrational for a while, but eventually, we all know what happens.
    Mar 11 01:32 PM | 4 Likes Like |Link to Comment
  • Is Record-High Market Overvalued? [View article]
    Your P/e average since 89 cannot be more biased, you carefully select the biggest multi-year bull run which includes p/es above 40 (in year 2002). I would prefer to see a century long average which also includes depressions.
    Mar 9 01:37 PM | Likes Like |Link to Comment
  • Citigroup: Destined To Double By 2014? [View article]
    BAC's (ttm) EPS is a ridiculous 46 times! Citi's is trading at almost 18 times earnings. I would't trust forward earnings. To me, banks are expensive.
    Mar 6 10:04 AM | Likes Like |Link to Comment
  • The S&P 500 Is Trading For 17.9x Last Year's Earnings, Not 13.7x Next Year's Earnings [View article]
    Where did you get the nice ttm earnings since 1870 graph?
    Mar 6 07:30 AM | Likes Like |Link to Comment
  • Preparing For A Potential Deflationary Scenario [View article]
    I understand (and probably agree) with Faber's deflationary view, given that there are very powerful secular structural deflationary forces currently at work (such as population growth and age structure changes), and the long-term trend is for this to intensify. However, deflation lifts real interest rates, i.e. the money in your wallet 'pays' you interest simply because everything else gets cheaper. To me, this includes gold. To suggest gold as a deflation hedge is very strange to say the least.
    Mar 6 06:49 AM | 1 Like Like |Link to Comment
  • Is The Dow Doing A Blow-Off Top? [View article]
    I guess what is fueling this rally are the long/ short strategies used by some big players, this would explain so much divergence and mixed signals on low volume. These are characteristics of a major topping process, as no one has the conviction to go long without shorting something as a hedge. In a true bull market you would go long everything without hedging.
    Mar 5 03:30 PM | 1 Like Like |Link to Comment
  • Top Line Sales And Profit Growth Falter As The Dow Approaches All Time Highs [View article]
    Maybe some trend following systems are still supporting the markets, since there hasn't been a 'confirmation' i.e. crash powerfull enough to break it. Looks like robots are jumping in on weakness. But the big players, insiders, etc.. are willing to dump, but cannot really since there is no market for so muck stock, and this would cause a crash, which would kill the value of their remaining holdings. So its best to sell as much as possible while you still can, without breaking the trend. Only problem is, when the trend eventully breaks, its going to get very ugly as everyone, big, small, robots and etc.. start selling at the same time and even uglier when leveraged traders start getting margin calls. Trouble is, a four year bear market rally is a powerfull trend and the topping process takes a while, but will eventually be completed.
    Mar 2 04:17 AM | 1 Like Like |Link to Comment
  • Record Insider Selling Marks Top In Equities [View article]
    Agree in part with the argument of GDP vs. total market cap, but now 40% of S&P revenue is generated abroad. I would like to see a chart of total global market cap divided by global gdp.
    Feb 27 06:10 AM | Likes Like |Link to Comment
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