Does Momentum Investing Actually Work? [View article]
Thanks for a well written explanation of how & why the concept works. We have been using it for the past 7 years with excellent results. That said, past performance is not a guarantee of future success.
Danger: Unexploded Bomb In Your Preferred Stock Portfolio [View article]
Good article and great points. Most people haven't a clue about Pfd's or bonds for that matter. Leaving your fate up to herd mentality bond managers can be harmful and the Fed has made everything more difficult for the unaware.
Sorry Bears, We're In A Secular Bull Market [View article]
RE: "Here they come...i.e., the comments about the Fed supporting everything..." What if the Fed stops? Not likely anytime soon but the real trap is that they can't stop. There is never a time in history when a Central Bank has found it politically digestible to do so. But that's history. The bulls like to proclain victory by pointing to the rise from 2009 to now as proof. But what does this actually prove? That if you were prescient enough to spot the bottom - or something close to it - and stayed aboard, you made good money. The facts end there and we find ourselves with a $3 Trillion Fed balance sheet; 7.9% unemployment; less than 2% GDP growth and fiscal deficit of a $Trillion or more per year for the foreseeable future. Housing still stinks and all the money printing has produced less and less return as time has passed. Those are also facts. The trick will be to figure out the next market move. We have built a business around the attempt and while not perfect - unlike the certainty of the author - we will be happy to review "The future" when it becomes the past in a years time.
Navidea: Unjustly Damaged By Misleading Article [View article]
That was then, this is now. With income of minus $29 million, I would not call this a growth stock. If you are a technical analyst, you would know that it broke that uptrend in May 2011 at $5.48 and has come off the next high at $4.77 in July. The new downtrend continues and with insiders net selling, none of this bodes well for the stock. I sympathize with those who hope things will work out but the market is selling off the stock. You cannot let hope triumph over reality.
Navidea: Unjustly Damaged By Misleading Article [View article]
We just do the technical analysis on the stock and it has been in a down trend since $4.75 in July. Somebody has been selling and the article - correct or not - only exacerbated the trend. The stock has recovered a bit today but it has a way to go to reverse the chart damage. Let's face it, the company is a start-up with no revenue to justify the value - yet. It trades on hope and lives by the good will of its lenders. The price moves with the ebb & flow of the dreams of its promoters and all of the speculation in these articles about this or that test success or failure is just hype.
Will Solazyme Be The Next Big Thing? [View article]
This may or may not be the second coming but for the moment the stock is tanking. If and only if they produce a fuel that competes with oil & gas on price will they be successful. It's a nice concept to watch but not yet ready for investment.
The article is ok so far as it goes but the elements missed are huge: Debt destruction destroys the lender as well as the owners of the debt produced assets. Left to the markets to work out, history shows that the process takes 2 – 3 years and finally the excess debt is wiped out and the assets fall to a price where they become again attractive. This is where we are. The Fed, with all its stimulating, is attempting to prevent these natural financial reactions from occurring. In so doing it is expanding liquidity and money supply to offset the money implosion. This is a race that we know extends the time it takes to resolve the issues. Japan’s experience since 1990 shows how this is working out for them and there is no reason to expect that our outcome will be any different. When, as or if the current process ends, asset prices will have found their bottom, debt will be written off and Ben assures us A: that he 100% certain he will see it when it occurs and B: he will be able to remove the money created to offset the previous debt obliteration. History records numerous similar instances where this was tried. None were successful primarily because the political climate in the countries undergoing the process never became right; the central bankers were replaced by politicians who misunderstood the economics and – most important- both the bankers and politicians had lost all credibility by the time the end came. With the loss of confidence, lenders demanded higher rates of interest to offset loss of buying power and Gresham’s Law kicked in. We are seeing this now in Iran, Greece, Spain & Italy. They may all have different reasons for money flight but regardless the cause, once trust in the system is lost the currency is destroyed. What is being done now increases the risk of a greater calamity than the one Ben & Tim seek to avoid. If we are lucky we will stay in this stagnant bog for the years it will take to solve the problem their way. The risk is that something unexpected happens and the economy goes up in smoke.
Fundamentals can fool anyone. It's your vantage point. Just like optical illusions, they can make you think various outcomes are possible depending on your view or bias. After fighting this for years, after buying amazing value stocks that only became more valuable, we decided that getting our opinion out of the way and determining what the market was saying would reduce our errors. We use three charting systems to ascertain market trends. Our system confirmed that the stock has strong upside momentum and in our method, it appears that $6 is where it will run into heavy supply. It may be a choppy road getting there buy that's our target. We are not always right either as this is a business that can do severe damage to beliefs and systems from time to time. This means that we have to be careful to stick to our system and be ready to get out if our metrics reverse. So far, this one hasn't. On a fundamental note, everyone can see that S is the weak sister in the Cellphone wars. But they are doing the right things and reducing debt & using cash better. Leverage is working in their favor at the moment and that is a positive that the market seems to be recognizing.
Morgan Stanley: This Is The Most Bullish Potential Event In 2012 [View article]
He was/is a turn around specialist. He took misused assets and reversed terrible management decisions to make a fortune. If Congress is his majority party as well, it will - initially - go along with him. Debt Destruction Depressions never end well. They only end either quickly or slowly. The current regime has bought into the slow death mode, a la Japan & EU. IF he decides on the quick version, we can be out of this in 2 years. It takes guts to cut taxes and government spending esp. in the face of the ignorance entrenched in the government & moronic media. If he opts to stay in line with only a few tweeks any "bullishness" will only be as short lived as the current morphine injections we've seen to date.
Sprint: Is The Turnaround Story Complete? [View article]
Who would put on a short position on a $4 stock? Esp. one that just broke above resistance @ $3.75? The charts are strong as is volume to the upside. This stock should work its way up to $6. Disclosure: I am long S.
Former Obama OMB director Peter Orszag says, despite several states already taking their cue from the Supreme Court’s health care decision and opting out of offering additional Medicaid coverage, most will continue to do so because of the attractive subsidy. States are already offering more coverage with a federal government reimbursement rate below 60%, and when it goes to 90% the temptation will just be too hard to resist. [View news story]
Tesla Motors' Full Analysis, Its Only Mistake, Outlook And Elon Musk [View article]
Does Momentum Investing Actually Work? [View article]
Danger: Unexploded Bomb In Your Preferred Stock Portfolio [View article]
How Gas Really Gets Priced [View article]
Sorry Bears, We're In A Secular Bull Market [View article]
What if the Fed stops? Not likely anytime soon but the real trap is that they can't stop. There is never a time in history when a Central Bank has found it politically digestible to do so.
But that's history. The bulls like to proclain victory by pointing to the rise from 2009 to now as proof. But what does this actually prove? That if you were prescient enough to spot the bottom - or something close to it - and stayed aboard, you made good money. The facts end there and we find ourselves with a $3 Trillion Fed balance sheet; 7.9% unemployment; less than 2% GDP growth and fiscal deficit of a $Trillion or more per year for the foreseeable future. Housing still stinks and all the money printing has produced less and less return as time has passed.
Those are also facts. The trick will be to figure out the next market move. We have built a business around the attempt and while not perfect - unlike the certainty of the author - we will be happy to review "The future" when it becomes the past in a years time.
Sorry Bears, We're In A Secular Bull Market [View article]
http://bit.ly/LQUsNG
Wall Street Journal Economists' GDP Forecasts: 1.6% For Q4 2012 And 1.7 In Q1 2013 [View article]
Navidea: Unjustly Damaged By Misleading Article [View article]
Navidea: Unjustly Damaged By Misleading Article [View article]
Will Solazyme Be The Next Big Thing? [View article]
QE Confusion Reigns Supreme [View article]
Debt destruction destroys the lender as well as the owners of the debt produced assets. Left to the markets to work out, history shows that the process takes 2 – 3 years and finally the excess debt is wiped out and the assets fall to a price where they become again attractive. This is where we are. The Fed, with all its stimulating, is attempting to prevent these natural financial reactions from occurring. In so doing it is expanding liquidity and money supply to offset the money implosion. This is a race that we know extends the time it takes to resolve the issues. Japan’s experience since 1990 shows how this is working out for them and there is no reason to expect that our outcome will be any different. When, as or if the current process ends, asset prices will have found their bottom, debt will be written off and Ben assures us A: that he 100% certain he will see it when it occurs and B: he will be able to remove the money created to offset the previous debt obliteration.
History records numerous similar instances where this was tried. None were successful primarily because the political climate in the countries undergoing the process never became right; the central bankers were replaced by politicians who misunderstood the economics and – most important- both the bankers and politicians had lost all credibility by the time the end came. With the loss of confidence, lenders demanded higher rates of interest to offset loss of buying power and Gresham’s Law kicked in. We are seeing this now in Iran, Greece, Spain & Italy. They may all have different reasons for money flight but regardless the cause, once trust in the system is lost the currency is destroyed.
What is being done now increases the risk of a greater calamity than the one Ben & Tim seek to avoid. If we are lucky we will stay in this stagnant bog for the years it will take to solve the problem their way. The risk is that something unexpected happens and the economy goes up in smoke.
Sprint Needs An Exit Strategy [View article]
On a fundamental note, everyone can see that S is the weak sister in the Cellphone wars. But they are doing the right things and reducing debt & using cash better. Leverage is working in their favor at the moment and that is a positive that the market seems to be recognizing.
Morgan Stanley: This Is The Most Bullish Potential Event In 2012 [View article]
Sprint: Is The Turnaround Story Complete? [View article]
Former Obama OMB director Peter Orszag says, despite several states already taking their cue from the Supreme Court’s health care decision and opting out of offering additional Medicaid coverage, most will continue to do so because of the attractive subsidy. States are already offering more coverage with a federal government reimbursement rate below 60%, and when it goes to 90% the temptation will just be too hard to resist. [View news story]