User 68127

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45 Comments

    • The Reason to Ignore Most Economists [view article]
      The "exports will save us" story is great until the overseas economies start slowing as well...oh wait!...they already have!

      U.S. consumers are buying less. Guess what? That translates to fewer imports to the U.S. Guess what? Fewer imports means other nations have less cash to spend on our exports, and less incentive to expand. They will also start cutting their staffs. Guess what? That means that U.S. multinationals are about to see their international business slow as well, and that is even IF the dollar does not continue to strengthen....       Aug 28 11:15 AM
    • U.S. Household Debt: A Frightening Picture [view article]
      You may be correct, but how do you know what is the "right" level of debt? Just because it is higher than before does not mean debt is too high now.

      Many people have mortgages that are much higher than 100% of their annual income, and yet they can service them comfortably. Why is debt at 100% of GDP too high?

      Also, shouldn't we consider net worth rather than just debt? Why exclude the assets and only focus on the debt? Isn't it the total picture that really determines ability to service debt?

      Last I heard the net worth of U.S. households was around $55 trillion, which would be about 4x GDP and about 4x household debt.

      So, again, you may be correct, but your analysis is incomplete.       Aug 26 12:41 PM
    • The Last Days of the Long Investor? [view article]
      If you can lose 30% of your capital in 5 trading days, you are a speculator, not an investor.

      Maybe you should take less concentrated positions or not use leverage.

      For an investor, who sizes positions properly, the short term volatility provides opportunity to make money. When a well-thought-out position goes against you, you are not wiped out, you just put more money in. Eventually, when the position rebounds, you are handsomely rewarded.       Aug 14 01:09 PM
    • General Growth CEO Gets Massive Margin Call [view article]
      Mish,

      The funny thing about the WSJ article is the statement that you did not include:

      "Few observers doubt that General Growth will manage to refinance its debt."

      What??

      Disclosure: short GGP       Aug 11 12:34 PM
    • Why Visa Got Spanked [view article]
      There are good arguments to be made fundamentally for both sides of the Visa trade. Regardless of fundamentals, Visa is a momentum stock.

      EVERY stock has a bull case and a bear case. People have been buying this one (and trumpeting the bull case) mainly because it has been going up. That is what momentum investors do. The valuation has become rich. Some of the bear case is starting to become noticed.

      You cannot ignore a huge run-up (which sets aside the rich valuation and risks), as if it is "normal" and then decry a sell-off as if it is "unfair."

      When you run with the fast money crowd, sometimes you make fast money, and sometimes you get burned. The selloff is no more irrational than the run up.       Aug 08 12:56 PM
    • Whole Foods' Rotten Quarter [view article]
      Don't break your arm patting yourself on the back! Who cares?

      What should investors do now?       Aug 07 02:05 PM
    • Merrill's Muddled Analysis: Another Reason I'm Bullish on Financials [view article]
      Tom "Bagdhad Bob" Brown and Bill Miller should get together for their own "I'm smart and the market is stupid" convention... Aug 06 01:32 PM
    • Merrill's Muddled Analysis: Another Reason I'm Bullish on Financials [view article]
      Merideth Whitney has been right on the financial stocks the whole time Tom Brown has been wrong.

      Plus, she is smarter and better looking. Probably richer too, if Tom has been "eating his own cooking" in his long-only hedge fund.

      It is no wonder he is jealous.

      Aug 06 01:29 PM
    • Bill Gross: Talk of Rate Hikes is 'Comical' [view article]
      Raising rates in a recession? It all depends upon your starting point. If you recall that the Fed started cutting last fall at 5.25%, then short rates could easily go higher while still being below that level.

      Snugging up the short rate might help contain inflation, benefit the dollar and further ease pressure from high energy prices.

      Furthermore, there is a credit crunch. That mean loans are NOT AVAILABLE at low rates to consumers and businesses, if at all. Since no lending is occurrring at 2% anyway, what does it hurt to bump it up to a realistic market rate? It only hurts the big money cronies at the I-banks and commercial banks, which is why it is not being done. The benefit of low rates is being "privatized" while the detrimental effect--rising food and commodity prices--is being socialized.       Aug 06 12:50 PM
    • Bill Gross: Talk of Rate Hikes is 'Comical' [view article]
      Bill Gross is "comical." However, we do seem to be inching closer to his forecast of 5000 on the Dow made about 4000 points lower than current levels!

      As usual he is talking his own positions. If he knows that the government is going to bail Fannie and Freddie due to the size and connections that his firm has, or its hiring of Greenspan, then more power to him. Just don't call him a great investor. He is gaming the political system at the expense of the little guy.

      Aug 06 12:41 PM
    • Reviewing the John Thain Saga [view article]
      Hellooo, Newman! Thain claims that everything he said "at the time" was true.

      Suppose someone promised not to dump a bucket of water on your head. Then a minute later, they did! Suppose they said, "well, circumstances have changed. At the time that I said it, it was true!" Would you consider this to be a reliable or trustworthy person?       Aug 05 02:00 PM
    • Winners and Losers from the Mortgage Mess [view article]
      What happens if mortgage rates go up?

      Standards are already being radically tightened, meaning that many who are still able to get a loan will be forced to pay higher rates and/or fees.       Aug 05 01:22 PM
    • Market Analysis: Merrill Lynch and the Economy In Focus [view article]
      Thain argues that everything he previously said was true "at the time." So...if you do in fact need capital a few days or weeks later, it was not a falsehood?

      Thain is either not truthful or not competent. His defense shows that he prefers to be viewed as incompetent rather than dishonest. (Actually, he appears to be both!)       Aug 05 01:14 PM
    • Investment Discipline in the Year of Capitulation [view article]
      Libby, dude! Anyone who is down 40% in the last twelve months does NOT have a sound long term investment discipline.

      You cannot be down that much and claim to have a sell discipline.

      You cannot be down that much and claim to understand your companies and the market.

      You cannot be down that much without failing miserably at prudent and responsible diversification.

      Maybe you should re-consider whether some of these guys are indeed "legends." How bad does performance have to be before you realize that maybe they were just rolling the dice and got lucky?       Aug 05 12:48 PM
    • Financials: The Dangers of Zero Weight [view article]
      Ultraman,

      If there are home equity loans or piggyback loans in the portfolio, they are probably worth zero. Simply put, if the borrower is underwater on their home, the first lien takes a loss but gets whatever they can for the property and the second lien gets nothing.

      Also, what if the appraisal was unrealistically or fraudulently high? In that case, even a first lien could get next to nothing. Are you beginning to get the idea?

      Roger: a ten-fold move in C would imply $180/sh some time in the next ten years. Of course, with a lower earnings base now, there is no guarantee that C will even reach its prior peak in EPS within ten years...much less have the kind of PE expansion that would be necessary to reach this level...       Aug 01 02:28 PM
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