mavericks

The Empire Will Strike Back, Stocks Will Recover - For a While

"This rally continues to be the most hated rally in history."

Speak for yourself. I love it!

How Bloomberg Fabricates U.S. Housing Numbers

I'm going to take the other side of this argument since I own one of those 5-year adjustable loans and I've been paying interest only on 4 of those years. As it turns out, my payments will go DOWN next year if LIBOR stays where it is.

Second, I would think it would be in a bank's best interest to rent out, either to the former owners or somebody else, the homes they foreclose upon and try and wait for home prices to recover before putting them back on the market. If this is the case, would these homes be considered "empty"? Just asking.

Frankly, I think the tone of this article is a bit on the emotional side so that is why I'm questioning it.

California: Entering Inflationary Depression

"You might have seen the headline yesterday that the Bay Bridge in San Francisco had to be closed, on account of falling debris and structural concerns. A vast collection of mid-century infrastructure needs to be upgraded there..."

Umm...actually, they are upgrading the eastern span. The old span, which is where the debris came from, will be demolished afterward.

Wells Fargo Earnings: First Leak in the Dam?

It's not surprising that Wells Fargo has a growing number of non-performing loans. They cater to the larger mortgages in California and that segment (over $500K) which had held up fairly well while sub-prime sank, is now quickly becoming a nightmare.

The good news is that WFC is rather unique and I wouldn't necessarily extrapolate that onto other banks. The bad news is that California is still WAY overpriced in the $500K to $1 million market, which frankly, is still the majority of the homes in the metro and coastal areas.

Bond ETFs Suffer from Pricing Discrepancies

Excellent article. Big reason why I invest only in equity ETF's and CEF's. There's also a dividend yield hit if investor's are buying at a premium as well.

ProShares 130/30 ETF Is Already Successful

The only problem I see with the 130/30 approach trying to emulate a hedge fund is that it will not be actively managed. Sort of like trying to drive fast down a windy road w/out power steering. If growth outperforms value, based on the long/short criteria for this fund, then CSM should not outperform.

Mortgage Delinquencies Rising

I bought a home in '06 with 20% down and a 5-year interest only loan (interest only is great because it still gives you the option of paying the loan fully amortized). Now, I'm not an Option-ARM even though I reset in the same time frame as many, but checking LIBOR and where it is now, my payments would actually go DOWN on my reset.

Are you sure there's not alot of Option-ARM loans that would also share in this positive predicament? Certainly, anyone who put no money down and just paid the minimum payments is going to be in trouble even with a positive reset, but do we know what % of Option-ARM's are in that situation?

CEF Weekly Review: Death of a Friend

Sure. Though many of the discount brokers don't seem to have shares. Scottrade usually does.


On Sep 29 03:01 PM rod9301 wrote:

> Is there any way to short a CEF?

ING Delivers a Big Alt-A Surprise

"This is in addition to the executive compensation limitations recently put in place for Dutch banks that will send senior staff leaving in droves."

If they leave in droves because their bonuses will be limited to 100% of their salary (which still seems pretty generous), then it just proves that the system needed a major overhaul. Besides, the banks could just up their salaries. Right?

PIMCO High Income Fund Cannot Support Its Share Price

I think PHK's premium has much to do with the state of liquidity in the markets. I look at the buy/write CEF's and EVERY one I follow has gone from 20% discounts to premiums...some as high as 30% in just 6 months! It's historically unprecedented as a combination of bank liquidity and small investors looking for income in tough times has moved these CEF's to unsustainable premiums.

That said, I would not be short a monthly pay CEF, particularly one with PIMCO's name behind it. You're basically waiting for a dividend cut, which could be a long wait in a rising market.

CEF Weekly Review: Municipal Funds Rule

Where do the equity buy/write funds fall under in the Claymore CEF Index? I think there should be a separate category for them considering how many there are. I count at least 30.

Major Market Selloff Coming?

This also seems to be the most expected correction in market history which makes me wonder if it will unfold the way everything thinks.

Several months ago, everyone said you had to have gold (pundits, advertisements, etc.) and I commented that if everyone was saying that...gold ain't going nowhere. Gold has gone nowhere.

Has the Fed's Exit Strategy Already Begun?

Thank you for your commentary. I look forward to more here on SA as I have just become a follower of Bob McTeer...someone who has unparalleled insight into Fed actions.

I suggest all of you become followers too.

PHK: In Search of the Premium

Monthly pay CEF's are tough to short unless you're pretty sure there's going to be a dividend cut. Over-valuation has not stopped CEF's going to ALL TIME high premiums this year. Fixed income CEF's are even tougher because, as you point out, its difficult to pinpoint the the exact NAV value.

There are some equity CEF's that are at insane premiums too where there is no doubt what the NAV value is. Still, small retail investors looking for yield in this difficult economic environment have pushed pushed many of the buy/write funds and dividend harvest funds to ridiculous premiums. I have a feeling this will not end well.

Dow Target 6,617, October 25, 2009: Here Is Why

The only way this happens is if the banks and the brokerage firms de-leverage again en masse. Unless you come up with a scenario why they would do this, I don't see your downside targets happening. It's not going to be due to unrealistic earnings estimates or historical mirrors.