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theking3456

theking3456
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  • Bernanke Ignites Bear Market In Gold And Silver [View article]
    Perhaps the author will end up being correct about the directional call on silver, but I would caution anyone against buying ZSL, unless you are a short term trader.

    Here is a 1 year graph of SLV vs. ZSL. http://yhoo.it/yQhTvz

    SLV (which is highly correlated with the price of physical silver) has been flat over the past year, while ZSL has lost about 70% of its value.

    So, I will short all the ZSL anyone wants to buy, because no matter where the price of Silver goes, ZSL is going down over the intermediate to longer term.
    Feb 29 10:27 PM | 1 Like Like |Link to Comment
  • Not So Fast Qualcomm Bulls, Spreadtrum Is The Value Play [View article]
    Suddenly that SPRD short at $13 is not looking so bad. I guess BEA is not quite a "chump" afterall. I frankly dont know anything about this company, or know what is going to happen to the stock, nor have I ever taken a position in it. But it is amusing when people on SA arrogently proclaim they know what is going to happen and really dont. I especially love the sarcasm in SBT's post "how is that short....working out for ya" The "ya" (instead of you) of course being the sarcastic way to ask the question. SBT said "watch what happens to SPRD in 2012". Well, Im watching, and so far its down 33% (and over 40% from when SBT was making his condescending comments to BEA). Pretty pathetic! I only hope if this turns out to be a fraud, we will see an apology, but I suspect not.
    Feb 29 06:48 PM | 1 Like Like |Link to Comment
  • 6 Reasons I Am in TBT and Cash Now [View article]
    You may be right, a massive QE could cause rates to rise and TBT with it, but I still think a short TLT would provide a better return in that, and nearly every, scenario. I also think in a rigged market, like the T-bill/bond market, anything can happen in the short term and intermediate term, including the exact opposite of what you would expect. (i.e. I am thinking of the explosive rally in Treasury bonds right after the US Treasury downgrade last year, as one example). In the long term though, an exponential rise in government debt relative to GDP and money in circulation can only lead to one outcome.
    Jan 31 05:36 PM | Likes Like |Link to Comment
  • 6 Reasons I Am in TBT and Cash Now [View article]
    Since this article was written, TBT is down 51.3% and is very close to yet another all time low. TLT on the other hand is only up 31% in that time. So, I think it is clearly a better play to short TLT than to go long TBT. I wouldnt be suprised to see TBT decay into the single digits over the next few years as the Fed artificially keeps interest rates low, but by shorting TLT, you can play the decay and also take advantage of a bond market meltodown in the years to come, when if finally does happen.
    Jan 31 04:23 PM | Likes Like |Link to Comment
  • 6 Reasons I Am in TBT and Cash Now [View article]
    I think the mistake here is thinking that the bond market is a "real market" in the sense that long term interest rates will naturally adjust to market inflation expectations. The problem is that it is the bond market is completely rigged by the Fed. Both short term rates AND long term rates are being kept artificially low, and will continue to be kept low, for many years through bond purchases by the Fed. I think that it is wrong to assume that the Fed only has control over short term rates, and that the market determines long term rates (in this country that is-the country with a Fed that controls the worlds reserve currency with the ability to print unlimited fiat money to buy assets). Even if inflation goes much much higher, our government will both continue to 1) lie about the real inflation figures, and 2) will continue to buy long term Treasuries to keep rates low. Even if there are NO buyyers of our longer term treasuries by the private sector because of the negative real interest rates, the Fed will just buy up the whole float if they have to, to keep rates low. Why? Because if interest rates actually went to a more natural rate, the whole ball game is over. Can you imagine trying to finance $20 trillion in debt (projected in the next few years) at 6 or 7 or 8%? (what I think is a more natural rate for our long term bonds). We are talking about interest costs on debt approaching total government revenues! It would not be possible! and our entire financial system would collapse. The Fed is going to continue to keep the scam going for a long time, and I think TBT will continue to decay during this time. If you are in it for the long term to play the eventual collapse and want to do something about it now, I suggest shorting TLT to take advantage of the natural decay in these ETF's. It may take many years before it pays off, but at the same time, I am 100% confident that it will.
    Jan 25 04:27 PM | 1 Like Like |Link to Comment
  • A Simple Formula For The Fair Price Of Gold [View article]
    Yes, if you buy a gold ETF, transaction costs can be negligible, but when you "own" this ETF, you just own a piece of paper that says you own gold or silver. In todays world (Im thinking MF global) there is risk in that assumption of ownership. There are much higher transactional costs in having PM's in your posession, but a much lower chance at financial shenanigans that will destroy your assumed wealth.
    Jan 2 06:39 PM | Likes Like |Link to Comment
  • A Simple Formula For The Fair Price Of Gold [View article]
    Very good points. I suppose I was thinking of my argument in a more theoretical way, but it is very true that the transaction costs can be quite significant for retail investors, and can reduce or eliminate any potential advantages of buying precious metals (as an alternative to cash in the bank) in a low interest rate environment. Here is a website of a major dealer that quotes prices about 10% over spot, which is quite signficant. http://bit.ly/sDkNz3 The larger amount one purchases, and the longer the duration that one holds the PM (assuming the Fed maintains ARTIFICALLY low interest rates for this longer time period), the less signficant the transactional cost becomes of course.
    I suppose the real (in my opinion) chance at dollar/monetary failure, and the retention of purchasing power with PM's in this environment, overwhelms everything else in my decision making.
    Jan 2 06:25 PM | Likes Like |Link to Comment
  • A Simple Formula For The Fair Price Of Gold [View article]
    I think many physical silver and gold buyers, including myself, look at this differently. I buy physical silver and gold not as an “investment” to beat the returns on the Dow, or some commodity, or to beat advances in real estate prices. I look at is an alternative currency to better protect purchasing power than to put your dollars in savings/checking accounts/CD’s at banks earning artificially low interest rates. In that respect, the fact that gold is an all time high against steel, hardwood, cotton, etc has shown that it has in fact been a very good retainer of purchasing power in this low interest rate environment. As far as what will happen in the future, I think the key question is would I rather today have one ounce of physical gold to hold, or would I rather have $1566 (todays gold price) earning almost zero interest at a bank? What is going to give me more purchasing power X months or X years from now? If you believe that the dollar’s value will collapse eventually (I do), then it is clear what the answer will be. But even if you don’t believe the dollar will collapse, I would still rather have money in gold instead of earning zero interest at a bank (the Fed has indicated they will continue to maintain virtually zero interest rates for the next year and half) as the dollar gets inflated away. Gold/silver are liquid and can be easily converted back into dollars if the money is needed, as one would be able to use money at a bank. Of course I think it is wise to diversify your investments into real things like real estate and commodities and stocks if you are worried about inflation. But I think one can make a strong case that physical gold and silver is a much better alternative to the “dollar” as a currency.
    Jan 2 04:14 PM | 5 Likes Like |Link to Comment
  • Stay Angry And Get Physical (Silver) [View article]
    Perhaps I am reading you wrong here, but couldnt there be a fourth option, and that is that SLV does have and own all the bars that they claim, each with a valid serial numbers, but perhaps 10 (or some number much more than one) different investors each think they have a claim on an indvidual bar that exists in the vault? This would be similar to the fractional reserve banking system, where perhaps 10 depositors each have a claim on each dollar in reserve at the bank. Since very few investors in SLV ever take delivery, and very few depositors in banks ever withdraw a big percentage of their money in cash, there is never a problem with either system.
    Dec 31 04:03 PM | 2 Likes Like |Link to Comment
  • Latest Developments in the Pharmathene-SIGA Case Point to a Strong Buy for PIP [View article]
    Once someone on SA blows a directional stock call, we generally dont hear from them again about it. 13 months after this article was written, PIP is down 68% (and down 37% from the original article from JA). No apologies, no follow up (although one comment during a momentary pop to $3/share in September where JA wanted apologies from those who insulted him personally, the timing clearly implying that he thought that they should eat crow because he was right all along). Yes, the stock price has been higher than it is now, but did JA tell readers at any point to sell?-NO, only that it was a "strong buy" at over $3/share when he wrote this. I personally like JA alot and enjoy listening to him and reading his work, but alot of people (not myself) may have risked and lost cash because of his article (which I imagine was self-serving, since he was long the stock, and Im sure wanted to create visibility/demand for PIP stock), and Im sure they dont like the disappearing act after the stock imploded. Not saying PIP cant go back up, but its not looking very good right now.
    Dec 30 01:10 AM | Likes Like |Link to Comment
  • Qihoo Looks Increasingly Similar To China MediaExpress [View article]
    http://bit.ly/q8jCf0

    Yet another great piece of research on QIHU by Citron on their website - thank you. I would pay money to see even one "analyst" on the latest conference call try the explain QIHU's math.
    Dec 7 02:51 PM | Likes Like |Link to Comment
  • Qihoo Looks Increasingly Similar To China MediaExpress [View article]
    The conference call was a joke. QIHU certainly did not address Citron's questions directly, and the "analysts", or should I say "cheerleaders", seemed to ask superficial questions scripted before the conference call even took place.
    Nov 16 11:07 PM | 2 Likes Like |Link to Comment
  • Why I'm Still a Buyer of Just One Gold Stock [View article]
    Ouch.

    KGJI on 8/30/10 $8.64/share
    Today (10/30/11) $1.29/share
    Oct 30 10:55 PM | 1 Like Like |Link to Comment
  • Geithner’s comments that there is “absolutely” no chance that another U.S. financial institution would fail is music to Bank of America (BAC +6%), Morgan Stanley (MS +3.8%) and other bank stocks (XLF +1.4%). “The direct exposure of the U.S. financial system to the countries under the most pressure in Europe is very modest," the Secretary says.  [View news story]
    Bernank's printing press is the insurer.
    Oct 7 02:36 PM | 1 Like Like |Link to Comment
  • Geithner’s comments that there is “absolutely” no chance that another U.S. financial institution would fail is music to Bank of America (BAC +6%), Morgan Stanley (MS +3.8%) and other bank stocks (XLF +1.4%). “The direct exposure of the U.S. financial system to the countries under the most pressure in Europe is very modest," the Secretary says.  [View news story]
    How true of a statement that is. I guess I just assume that most of these institutions have already buddied up to the trifecta, to make sure they can get in line for taxpayer dollars when the collapse comes.
    Oct 7 02:33 PM | Likes Like |Link to Comment
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