Seeking Alpha

threeleaves

threeleaves
Send Message
View as an RSS Feed
View threeleaves' Comments BY TICKER:
Latest  |  Highest rated
  • J.C. Penney (JCP +7%) soars as Marie Claire fashion director Nina Garcia tweets to thank CEO Ron Johnson for a walk-through of a prototype store. "Get ready to shop. It's going to be a game changer!"  [View news story]
    Nobody cares what some fashion editor says. But it only takes a tiny spark to cause the computers to trigger orders on 25% short interest. Simple short squeeze and nothing more. Too many shorts late to the party on this one.
    Jul 25 06:42 PM | Likes Like |Link to Comment
  • Like Italy, Spain bans short selling for three months - and perhaps beyond. The ban includes derivatives and over-the-counter instruments.  [View news story]
    Is the game rigged? Probably. Is there corruption on wall street? Yes. Do the criminals on wall street need to be tried and convicted with life sentences in hard core prisons? Yes. Did wall street bilk billions from taxpayers? Yes. Was the subprime market created by wall street bad for the economy? Yes.

    Is shortselling bad for the economy? . . . NO. If you really dig into the dynamics of short selling and how it functions in the market, you would see this. Here are a few functions:

    1) Almost all market rallies start because shorts start covering or they are being forced to cover. Having short interest guarantees that buyers will come in. The market will never go to zero. Why? Shortsellers.
    2) People like Einhorn would not be in the market if he couldn't hold short postions. Remember Einhorn has long postions also. Having short positions hedges long exposure. If you can't hedge long exposure, you will drive money out of the market. That's bad.
    3) All short postions are backed by cash or by assets. For example, if I were short only with my online broker, I would have to have cash in my account. That cash gives my broker the ability to loan to margin accounts whereby people could buy a little extra HLF if they so choose. In other words, it pumps money into the system.
    4) Are people like Einhorn pumping their books? Yes. But we need shortsellers to pump their books. Why? Because for every shortseller pundit, there are a hundred sell siders pumping their books and creating bubbles.
    5) Shortsellers are generally more cautious in their choices and more exhaustive in their research. They have to be because of the greater risk they take. Not the same for long only because the market has an upward bias. If the market were long only, then we lose checks and balances. The skeptics give the market validity. It's always the shortsellers that pour through sec filings to uncover fraud or shenanigans. The market needs these skeptics, and we need to give them a financial incentive (profit) to keep them here.

    I'm not saying that there isn't a problem with wall street. I totally concur, and it needs to be fixed. But banning short sellers is a recipe for disaster.
    Jul 23 08:31 PM | Likes Like |Link to Comment
  • Dreamworks Animation Is Acquiring Casper, He-Man, And Waldo; Here's Why You Should Care [View article]
    WSJ says revenue 80 mil and profit 20 mil. Cinema blend obviously not a reliable source of information, and, unfortunately, by default, your credibility comes into question here. I'm not saying wsj is always accurate, but 20 mil makes more sense than 376.

    For now, this stock seems range bound between 16 and 20. I don't think it will reach the 14 that analyst seem to be looking for. Not with short interest at over 20%. I would think there is a better chance that shorts get squeezed over 20 than holders panic below 16. I think people are making too big a deal out of DVD sales. It's old news, and I think DWA is doing a decent job of moving on. This aquisition is an example of that. So is the china deal.
    Jul 23 06:55 AM | Likes Like |Link to Comment
  • Apache's New Discoveries Will Propel Stock Higher By 2013 [View article]
    Ugg. I normally try to be as constructive as possible in regards to my comments about articles, but I just can't find a single valuable thing about this article. It's pure regurgitation of stuff everyone already knows, without even a single mention to the Egypt scenario which is what most would agree earns Apache the low multiple. And no, Liard is not presently a gold mine, not with NG at these prices. Even just a freckle of insight would have been appreciated.
    Jun 22 02:44 PM | 1 Like Like |Link to Comment
  • Losing Egypt Won't Be A Disaster For Apache [View article]
    I think they are saying that the infrastructure already exists for the north american market. That's what I'm getting from their slide presentation anyway:

    http://bit.ly/NoH3Bm
    Jun 21 06:19 PM | Likes Like |Link to Comment
  • Losing Egypt Won't Be A Disaster For Apache [View article]
    Off topic, but I thought the Liard basin numbers were pretty shocking. 48tcf and extremely efficient. They're saying they'll get 18bcf from a single well. Profitable at $2.57. Market just shrugged which I think is pretty funny since they made the announcement last Thursday when NG prices were rocketing. But Egypt election was on the horizon. Bad timing.

    I thought the 48tcf number was interesting since XTO had 45tcf in total when Exxon bought them for 31bil.

    Huge discovery. Almost sounds too good to be true, or am I missing something.
    Jun 21 01:43 AM | Likes Like |Link to Comment
  • Apache (APA +1.7%) says it has discovered "probably the best shale gas reservoir in the world" in a remote corner of northeast British Columbia, a massive field containing as much as 48 tcf of recoverable natural gas. One of three wells it drilled in the area delivered 21.3 mcf of gas/day over its first 30 days of production, which APA says is the most prolific shale gas test well it ever drilled.  [View news story]
    I was wondering the same thing.
    Jun 19 05:17 PM | Likes Like |Link to Comment
  • Losing Egypt Won't Be A Disaster For Apache [View article]
    It's about time someone laid this out. Much better APA article than most. There have been several SA articles on APA lately that have not so much as mentioned the Egypt situation. Thanks for having a clue.
    Jun 19 02:31 PM | 2 Likes Like |Link to Comment
  • Anadarko Ready For $5 Jolt By Fall [View article]
    Anyone know when to expect results of tronox trial?
    Jun 19 08:47 AM | Likes Like |Link to Comment
  • Natural Gas Gains May Evaporate In The Summer Heat: Positioning For The Long Term [View article]
    As long as producers can make money on $2.50 gas, and as long as there is bountiful supply, I just don't see how anyone could go 100x long gas or even say such a thing. Run up over past week is just trading noise. I thought it was funny that the runup on Thursday coincided with Apache investor conference in which they announced their massive Liard basin findings. Farris said it was "the best shale gas play in the world". They will need $2.57 domestic to produce at a profit. If they can make a profit on 2.57 gas in remote B.C., then what's the margin in Texas? . . . Also interesting that all their production growth projections take into account zero north american gas investment. Tons of gas in North America, and it just seems to keep on coming. Costs and crews getting cheaper. Lots of supply waiting for higher prices. And crude going down. Natural gas price bulls are looking in the rear view mirror. Shale is a game changer.
    Jun 19 01:07 AM | Likes Like |Link to Comment
  • How Investors Can Still Get Ready For The Greek Election [View article]
    Problem is that every time the liquidity issues are temporarily resolved, business just goes back to usual. Everyone "talks" about structural issues, but nobody ever does anything about it. And I don't think anyone will do anything about it, ever. Whatever new structure lays ahead will be one forced by the markets.
    Jun 16 02:37 PM | 1 Like Like |Link to Comment
  • These 8 Miners Could Tumble On Brazil's Rigid Environmental And Licensing Regulations [View article]
    It's not the author's personal sentiment that is causing the iron miners to be in the doldrums. And the "negativity" you speak of depends on your personal point of view. High commodity prices aren't necessarily a positive for everyone. Neither is the construction boom in China a positive for everyone.

    Also, you can have all the investment "experience" in the world, and still lose a metric ton of coin. Always prudent to give a listen to the other side of the trade.
    Jun 14 12:47 AM | Likes Like |Link to Comment
  • Apache: A High Value Stock In A Shaky Sector [View article]
    Got to wonder how/if the outcome of the Egyptian elections may move the stock price. I think there may be a decent chance of a relief rally despite results.
    Jun 13 11:39 AM | Likes Like |Link to Comment
  • Wolverine World Wide's Acquisition Paves The Way For International Growth [View article]
    Price is breaking out big time. It's amazing how the market for this stock has done a complete 180 over the past several sessions. Freezing cold (compared to others in space) to burning hot. Very few sellers. Any small pullback finds big (heavy volume) money to support the price. Perhaps some shorts getting squeezed. But as long as market conditions remain stable, this one gets pumped. Multiple expansion forthcoming, which is meaningful since its multiple is quite low compared to others in the space. Doubt the price dips below 40 any time this quarter. Probably a great hedge if you have a favorite short in the space.
    May 3 07:25 PM | Likes Like |Link to Comment
  • Jim Chanos shorts the clearest symbol of the rise of China and resultant iron ore gold rush in Australia - Fortescue, whose shares have risen more than 560X over the last decade. Against his short, he's long BHP, also heavily exposed to China, but better diversified and a with far less-leveraged balance sheet.  [View news story]
    I wonder how this trade is actually manifested. I've always wondered about kynikos' long positions since the last time I checked I couldn't find any 13f filings for them. But I just checked and they started reporting first quarter of last year. Interesting longs since you can gather that some of them are hedges on unreported short positions. I just always assumed their long positions/hedges were executed via options/derivatives or other off the record sort of activity.

    It does seem like an odd pair, BHP against fortescue. But I don't think it's a bullish stance on BHP, it's just an ultra-bearish stance on Fortescue. Reading between the lines of the trade: chanos thinks bhp will survive the china infrastructure implosion, but Fortescue will die. So, weirdly, it's a trade on company fundamentals, not china. . . . Too advanced and potentially risky for me though. I'd rather be short the huge-caps and long indexes. Would have to gather he has some sort of long dated insurance to guard against any huge upside on fortescue.
    Apr 30 02:23 PM | Likes Like |Link to Comment
COMMENTS STATS
76 Comments
34 Likes