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Cherry Picker

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  • Why Gold-Related Investments Are Slowly Becoming Worthless [View article]
    Congratulations on coming up with a topic that will give you plenty of site hits. Is there any part of your argument that would be any different ten years ago?

    I really loved this quote: "The long-run decline is under way for a number of reasons. For example, modern dentistry now relies on other commodities for false teeth." Yes, I see your point, except this happened years ago before gold started to run and of course gold false teeth have been such big sellers in the past ten years. In fact, your arguments are almost all dated and have been shown to be woefully meaningless given the run up in gold.

    Your only new argument is, if I am reading your article correctly, that impoverished governments will sell their gold to pay their debts. And after this they will have what to back their currency? Nothing! Paper with no meaningful hard assets to back them up and they'll still be deep in debt. Talk about getting it backwards. Hey world--lend me money. I don't have any assets--have sold the family jewels, but I have lots of paper to pay you back with and I can always print more.

    Huge stockpiles of jewelry will be melted down to raise cash. Of course this is something totally new to be added to the argument. As if gold scrap hasn't been a lucrative business every time the price of gold has gone up. Nothing new here either.

    You have presented virtually no new evidence to support your argument. Your argument makes no more or less sense that it would have when gold was selling at $300 an ounce. You posit that new mining techniques will lower production costs. Haven't seen that happening in the real world as costs go up and up as scarcity becomes more and more of an issue and production costs, contrary to your argument, go up and up.

    Anyway, congratulations on hitting on a controversial subject. I suggest you continue to write silly articles with important sounding headlines. How about "Ten Stocks That Are Sure To Triple" or "Why Apple Is Destined To Crash"? You too can become a top something or other on SA.

    Loved this quote from you back in November of 2011: "Look for the dollar and the price of gold to rise." Nice call. So I suppose this call for gold to go down will be a signal to take a contrary position too.
    Jan 13 05:55 PM | 48 Likes Like |Link to Comment
  • What To Expect From Salesforce, VMWare And Google In 2012 [View article]
    CRM getting slapped around on negative comments today. The only positive comments on CRM I have seen of late are revenue related. CRM bulls appear to have blinders on when it comes to anything other than revenue. News that some big deals were signed this quarter almost seems irrelevant if you believe that the company is willing to sacrifice anything for growth. Big deals do not necessarily equate to big earnings down the road. My guess is that the company cut its pricing to the bone to win these deals. Now watch them jump through hoops and spend a fortune on satisfying big customers which may or may not stick with them for the long haul. CRM has handed pricing power over to their customers and is going to be eaten alive by competitors who have not followed their lead.
    Jan 4 05:23 PM | 1 Like Like |Link to Comment
  • Stocks That Could Benefit From New Online Gambling Legislation [View article]
    Be careful about assuming that online gaming is attractive to credit card processors or traditional lenders. Even before the offshore poker scandal, credit card companies and traditional banks refused to process cash transfers to gambling sites. Aside from fear of facilitating unlawful activity and money laundering, banks know that most gamblers lose and that bankruptcy is common among gamblers. Large cash advances on a regular basis equals potentially large write offs. None of the names you mention strike me as being prospects for a giant leap into cash gaming.
    Jan 4 05:09 PM | 2 Likes Like |Link to Comment
  • Search Wars 2012: Google Returns To The Dark Side [View article]
    It's a good thing Google is expanding into other businesses. Searching for something other than things to buy on GOOG is getting harder and harder to do. I would gladly pay a reasonable monthly fee for a search engine that could filter out all the crap rather than move it to the head of the list. From my perspective, search engines are getting worse and not better. Some of us are so sick of all the ads we are tuning out.
    Dec 30 06:17 PM | 3 Likes Like |Link to Comment
  • A key panel of Japan's ruling Democratic Party of Japan agreed late yesterday on a controversial plan to double the sales tax to 10% by 2015 in order to reduce debt and potentially head off another ratings downgrade. The bill must still be approved by a government panel and then by parliament, where an opposition party is already hinting it may not cooperate.  [View news story]
    Yes, but that's what is supposed to happen when you are in debt up to your eyeballs. The economy will suffer from lower consumption, but eventually debt comes down and a more prudent society moves into the future.
    Dec 30 04:22 PM | Likes Like |Link to Comment
  • Despite all of Iran's blustering, closing the Straits of Hormuz would not be as easy as it claims, say U.S. analysts. Iranian boats are too small, and don't have the capability to sustain a prolonged blockade. It would be a harassment effort at best. Besides, analysts say, any attempt will be met by an immediate response from the U.S. Fifth Fleet based in Bahrain.  [View news story]
    I agree. If we give ample and clear warning to rogue nations that hostilities against the US will result in all-out war with a take no prisoners attitude, much of this saber rattling would end quickly.

    We never would have won WW II against Germany and Japan if we had not completely and utterly destroyed the means and will to wage war and keep their economies operating. Just as fat lazy Americans are all too happy to let the other guys kids go to war, things change dramatically once the homeland is hit as was the case with the attack on the WTC. All at once half the country was concerned that their little town would be next to be hit. For the most part it wasn't the privileged the ran to enlist. It was a combination of ordinary American patriots and out of work young people from economically hard hit areas of the country.

    Half measures in war are stupid and cost more lives than they save.
    Dec 30 04:19 PM | 1 Like Like |Link to Comment
  • Despite all of Iran's blustering, closing the Straits of Hormuz would not be as easy as it claims, say U.S. analysts. Iranian boats are too small, and don't have the capability to sustain a prolonged blockade. It would be a harassment effort at best. Besides, analysts say, any attempt will be met by an immediate response from the U.S. Fifth Fleet based in Bahrain.  [View news story]
    I would be inclined to look to China as a likely accomplice in the shooting down of our drone. A piece of hardware like this has invaluable intelligence value to a country like China while it is not all that likely that Iran by itself would have the sophistication and capabilities to gain real intelligence from the craft or to bring it down in one piece. The most likely scenario is that China hacked and hijacked control of the plane in exchange for unlimited access to it once it disappears from public view. Iran and China are probably in bed together on this one.
    Dec 30 04:06 PM | 1 Like Like |Link to Comment
  • A key panel of Japan's ruling Democratic Party of Japan agreed late yesterday on a controversial plan to double the sales tax to 10% by 2015 in order to reduce debt and potentially head off another ratings downgrade. The bill must still be approved by a government panel and then by parliament, where an opposition party is already hinting it may not cooperate.  [View news story]
    What a novel idea! A country whose people will actually be contributing their own money to paying down the national debt. Perish the thought!
    Dec 30 02:10 AM | Likes Like |Link to Comment
  • Despite all of Iran's blustering, closing the Straits of Hormuz would not be as easy as it claims, say U.S. analysts. Iranian boats are too small, and don't have the capability to sustain a prolonged blockade. It would be a harassment effort at best. Besides, analysts say, any attempt will be met by an immediate response from the U.S. Fifth Fleet based in Bahrain.  [View news story]
    Iran has attempted to avoid rogue state status by propping itself up as a champion of Middle Eastern interests versus Israel and the West. Attempting to hold the Straits of Hormuz hostage would meet with dire consequences. A showdown would be catastrophic to world economies, but it would also present a pretext for Israel to react unilaterally militarily. Iran knows this and is putting on a show to flex its petro-muscles. If this were not so, oil prices would have already spiked through the roof.
    Dec 29 08:22 PM | 1 Like Like |Link to Comment
  • Berkshire Hathaway's Value Is In Its Businesses, Not Buffett [View article]
    Buffet and company face the same insurmountable obstacle that Peter Lynch ran up against. The success of Berkshire has caused it to grow and grow to the point where nothing the company does can move the needle much. Lynch ran into the same problem. Once a fund reaches size, it can no longer move in and out of the market or a particular stock with ease. The magnitude of ownership makes it impossible. Compare the maneuverability of a speed boat versus an aircraft carrier. Those expecting the company's stock to appreciate at anything approaching its historical performance are going to be deeply disappointed.
    Dec 29 08:04 PM | Likes Like |Link to Comment
  • Undervalued Coal Stocks Ready To Move Higher [View article]
    I picked up some BTU late today (12/27/2011) and agree that coal appears to be overdone to the downside--possibly exacerbated by tax loss selling. With projections for coal powered electrical generation additions in both China and India being significant in coming years, this might be a good time to try a spec play in coal. I chose BTU because of its Australian operations.
    Dec 27 06:17 PM | 2 Likes Like |Link to Comment
  • 7 High-Yield Stocks For A Resource-Scarce World [View article]
    A more in-depth cash flow analysis might be in line for SCCO. The trend is not your friend for SCCO at present. If soft pricing persists, SCCO may be squeezing cash flow at the expense of capex to pay its dividend or it may cut the dividend to free up more cash for capital expenditures. Given the current payout, SCCO is flying close to the sun.
    Dec 23 04:20 PM | 2 Likes Like |Link to Comment
  • Caterpillar Is A Fast-Growing, Undervalued Buy [View article]
    Price trends in auction equipment don't say a lot for the demand side. Prices are far lower than they were in 2006. In many cases prices are dramatically lower. China's growth engine even if still growing has slowed substantially. Remember that this equipment isn't expended quickly. It lasts a long time and is portable. Mining and the oil patch have been bastions of strength for CAT, but just as the oil boom moves from place to place, so will the equipment. You don't buy at the top of a boom. Mining is already in slowdown mode, and if precious metals stay flat, this area too will soften for mining equipment manufacturers. Seasoned investors are pulling out of companies like this and as with so many other investment themes, the retail investor is always last to get the message.
    Dec 22 05:20 PM | 1 Like Like |Link to Comment
  • Thanks to the possibilities offered by cloud computing, Dividend Kings expects more acquisitions in the business intelligence sector, as buying another company seems easier than growing organically. He says these five firms could be prime takeover candidates: MSTR, CRM, TLEO, TIBX, QLIK.  [View news story]
    What does this Dividend Kings Market Currents article have to do with dividends? None of the stocks mentioned in this blurb have dividends.

    Other than that, mentioning CRM as a possible acquisition candidate is the epitome of absurdity. Going on eleven years in business, this company has virtually no GAAP earnings and sells at an absurd valuation even after dropping nearly 30% from its high. Why would anyone buy this company when companies like MSFT, ORCL, IBM, SAP and others are going to gut it within a few years? There was a lot of stupid talk about NFLX being bought out when it was selling for close to $300 a share and that talk is still going on except that NFLX shares are now going for $70 a share. CRM might be a buyout candidate at $50, but I doubt it.
    Dec 20 03:42 PM | Likes Like |Link to Comment
  • David Tepper's Low P/E Stock Picks [View article]
    I was interested to see VLO on this list. With the once wide gap between Brent and WTI narrowing significantly, there is some bearish sentiment towards domestic refiners now that artificially high US prices won't be supported by higher priced exports to world markets.

    I wonder if VLO is attracting Tepper because of the benefit that VLO will derive if the Keystone pipeline is approved? With the Koch Brothers behind the Keystone pipeline deal and exports by Valero reportedly being tax free, and given the fact that Valero has upgraded its refineries to handle the heavy sour crude from Alberta, this is probably a long term investment on the part of Tepper (unless things don't go as planned). A lot of investors don't have the stomach to stay with a cyclical commodity dependent company for a long period of time. Especially in a market where refiners are being shed by some multinationals.

    The net result of the pipeline deal when it passes is that it will be a huge windfall for Alberta tar sands producers, Alberta, TransCanada, and Koch Industries which is one of the largest purchasers, shippers and exporters of tar sands oil and last but not least, Valero.

    What is least clear is how much this will benefit the average American. The pipeline will no doubt create many jobs while it's being built, but those jobs will disappear once the project is complete. Given the fact that the pipeline will give Alberta via refiners, a worldwide market for its crude, the US is not likely to benefit at the pump. The best news, I suppose is that this will weaken the power of the OPEC cartel and make the middle east a smidgen less strategically relevant although still critically important.
    Dec 18 08:53 PM | 1 Like Like |Link to Comment
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