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  • Interest Rates Are on the Launch Pad [View article]
    Below is a link to the avg interest rate on US treasuries, which is now just under 3%. On $14 trillion in debt, this equates to about $420 billion in interest expense in a year.

    I completely agree with author that, absent of some deflationary shock which no one can predict, these articially low rates have to rise signficantly. What I think is not talked about enough is how, because of this, our interest expense will rise with these higher rates. Most of our government debt is short term, and will have to be rolled over at higher and higher rates.

    The interest rate assumpions in our governments longer term budgets are 3.5%. If inflation goes back to even 3% by 2012, and with normal real rates (which will occur without quantitative easing), we will have average treasury rates at 4 or 5%. Then, our interest expense (on a higher total debt level of about $15 trillion in 2012) goes to $600 billion to $750 billion. What does this do to our budget deficit? The recenly proposed budget cuts of $400 billion over 10 years by the Obama administration are wiped out in about 2 years by the difference in higher interest expenses. How are we going to pay for that? Of course we will borrow even more.

    What if we have a QE3 and QE4 to delay the pain? The printing press will cause even higher inflation in the future. What if inflation gets out of control in say 2014 and we got back to a late 1970's scenario with 10% interest rates? On $20 trillion in total debt thats $2 trillion in interest expense, which would overwhelm the budget (seeing that we only collect about $2 trillion in federal income taxes now). This could quickly get out of control and I hope this scenario does not develop. I would rather take a smaller amount of pain now by raising interest rates to normal levels.
    Mar 15, 2011. 10:52 PM | 15 Likes Like |Link to Comment
  • Ebix: Not a Chinese Fraud, But a House of Cards Nonetheless, Part III [View article]
    With the exception of hmm123 on a relatively small issue regarding semantics, there was not one person here that refuted any of the serious allegations that were well thought out and researched by the author. It is typical that when articles like this are written, people somehow invested in the stock will simply attack the messenger and not the message, simply because the stock price went down. Please tell me what specfically was incorrect in his article, and I and others will listen.

    Everyone has a natural inclination to believe CEO's, as most of them are honest, but some of them are not and should be called out when they arent. We also have a natural inclination to believe that fraud will be detected by either the SEC, analysts or the news media. The reality is though that fraud is usually found first by short sellers who have a personal financial incentive (unlike the rest of the groups) to expose fraud. The SEC usually finds out about fraud after everyone knows about it (Bernie Madoff is the best example, but there are thousands of others) analysts are concerned about investment banking revenues, and the media only likes a spicy story that can sell print. I recommend a book by David Einhorn "Fooling some of the People All of the Time" which give an insiders insight into these issues and how no one really cares about fraud until it negatively affects them personally. I do not know enough about the company to know if there was fraud here, or at a minimum very aggressive accounting and tax reporting, but the author certainly makes a compelling case.
    Mar 24, 2011. 08:02 PM | 9 Likes Like |Link to Comment
  • China MediaExpress: Groundwork, Research, And Videos to Disprove Allegations [View article]
    Im so looking forward to Michael Anderson's future article titled "Why I sold out of CCME (at a much lower price than when I was pumping it)"
    Feb 3, 2011. 11:09 AM | 9 Likes Like |Link to Comment
  • China MediaExpress Holdings: All Eyes on Deloitte [View article]
    What standards does SeekingAlpha have for its writers? How can someone like Glen Bradford be able to write an article that ends up on a yahoo finance page along with real news articles?

    Mr. Bradford is a fraud pumper. He provides no insight and no value, but just repeats what other "researches" say (only those researches who agree with him of course). He makes guesses about what firms like Deloitte might be thinking, or what CCME might be thinking, but he really has no clue because he hasnt talked to either. In this article he is basically saying that he doesnt think CCME is a fraud because because Global Hunter said so, but if is a fraud, Deloitte will definitely let us know (which is also untrue, as they have zero incentive for letting us know that). Thanks for nothing Glen Bradford.

    Please promise me Glen that you will publicly apologize to seeking alpha readers when yet another one of your pumps, CCME, is finally exposed as a fraud to everyone and is less than $5/share.
    Mar 7, 2011. 04:57 PM | 7 Likes Like |Link to Comment
  • Gold Is Worth $700, But A Correction Is Unlikely In The Short-Term [View article]
    Adreno, By looking at your picture I would imagine you were born after 1971 when Nixon took us off the gold standard. You (and I) have only known a world based on a US debt backed fiat currency system, which is a different system than in 99% of modern human history, where gold and silver were "money" (i.e either the physical was money or currencies were tied to gold/silver).

    So, you have to have some longer term perspetive on your point #1. You make a big assumption, and that is that the world will not go back to this system that we have used throughout most of human history. In fact, I think it is likely, as a potential debt induced fiat currency collapse will lead to demands to go back to this system in the Western world. I think the rise in Gold prices is, among other things, a reflection of this possiblity. Central banks are accumulating gold in huge numbers for reserves for a reason, and I think they would answer the question of whether gold is money quite differently than you.
    Sep 2, 2011. 11:51 AM | 6 Likes Like |Link to Comment
  • Four Stocks That Can Enhance Your Portfolio [View article]
    My opinion as to why AAPL will not reach $1000 in less than three years:

    World GDP is now about $60 trillion. If we have average growth over the next three years, GDP will be about $65 trillion. If you are saying AAPL will reach $1000, it will have a market cap of approximately $1 trillion. So, at this point AAPL's market cap will make up about 1.5% of world GDP. I think that is excessive.

    Looking at it this way, the median income in the US will be about $60K in 2014. 1.5% of $60K is about $1000. Do you think the average American, who is making $60K, will be spending $1000, on AAPL products in 2014? I think that is highly unlikely.

    But even if it were so in America, that is absolutely NOT the case around the world. 1/3 of the world lives in poverty, and they could not save enough in their entire lives to buy an iphone or ipad. The majority of people on this planet cannot afford an AAPL products, and they do not now, nor will they in the future be able to spend 1.5% of their income on AAPL products. So, the % of money that is spent by the other people on the planet who can afford AAPL products, has to be much higher than 1.5% of their income - unlikely.

    I do think AAPL is a good stock, and I would buy it here, but there are limits to its growth.
    Jan 7, 2011. 11:10 AM | 6 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, 2012. 04:14 PM | 5 Likes Like |Link to Comment
  • China MediaExpress Holdings: All Eyes on Deloitte [View article]
    Check out Glen Bradfords linkedin profile. First of all, he is about 23 years old so that should tell you something, but thats not the point. Look at who recommends him. It is none other than David Gentry, the president of RedChip, a known PAID Fraud pumper. He admits he was being paid by LLEN to promote the stock. David Gentry was on CNBC battling it out with Herb Greenberg, pumping another Chinese reverse merger LLEN here:

    So, the question is: It David Gentry, a known paid fraud pumper, paying Glen Bradford to pump frauds on SeekingAlpha?
    Mar 14, 2011. 06:23 PM | 5 Likes Like |Link to Comment
  • An Analysis of 4 Chinese Advertising Businesses [View article]
    Investors, if someone told you there were 4 publicly traded companies from the same country and in the same industry, and told you one of the companies was a fraud, and the other 3 were legit, which one would you pick based on the following forward p/e's?

    The company with:
    1) a forward p/e of 20.52
    2) a forward p/e of 40
    3) a forward p/e of 15.3
    4) a forward p/e of 3.86

    Based on these numbers alone, I would think that the chances of the company with a p/e of 3.86 being a fraud was about 100%, which of course it is. The reality is, the market is already signaling, correctly, that CCME is a fraud.
    Mar 8, 2011. 11:02 PM | 5 Likes Like |Link to Comment
  • Why I Sold Out of China Media Express [View article]
    TC, I have no doubt your wife is a very good and ethical auditor, but your point about being in the US is the most important point. There are different rules in China, and fraud is more prevalent. Im sure Deloitte Tohmatsu of Hong Kong is more susceptible to being a victim or accomplice to fraud.

    Satyam was a billion dollar cash fraud, and they were audited by PWC. If you cant say that "If PWC says they have the cash and the cash flow, then they do", then I dont think you can say that with Deloitte Tahmatsu either.
    Feb 1, 2011. 12:59 PM | 5 Likes Like |Link to Comment
  • Why I Sold Out of China Media Express [View article]
    If cash is very very very hard to fake, how did Satyam do it so easily? How did they fool a "Big Four auditor"? They were faking $1 billion. CCME is only potentially faking a few hundred million.

    And the Satyam fraud was in India. It is clear to me that there is much more potential fraud in China, based on the number of reverse merger frauds that have already been exposed as such.

    Have you seen any fallout from PWC in the USA from the Satyam disaster? NO, you havent. They are doing just find. It is because they are separted by thousands of miles and have different management. The "Reputational risk" that someone else mentioned is virtually non existant.

    Feb 1, 2011. 12:53 PM | 5 Likes Like |Link to Comment
  • Why I Sold Out of China Media Express [View article]
    Good article. One thing I hear over and over, and OVER, including from many posters here is about Deloitte being CCME's auditor. DELOITTE USA is NOT CCME's auditor! Deloitte Tohmatsu of Hong Kong is CCME's auditor. Why is this important? Deloitte USA has no legal liability whatsover in Deloitte Tohmatsu's audits. Deloitte Tohmatsu pays Deloitte to use its name. Look at the website of Deloitte Tohmatsu and it says very clearly that they are independent firms.

    I am not short CCME, and I am not saying CCME is a fraud (it could be though) but one thing I would do if I were a fraud is to get myself on an American exchange, and use Deloitte Tohmatsu as my auditor, fooling niave investors in the States to think that Deloitte & Touche USA was my auditor, which I think is exactly what is happening.
    Feb 1, 2011. 10:42 AM | 5 Likes Like |Link to Comment
  • Latest Developments in the Pharmathene-SIGA Case Point to a Strong Buy for PIP [View article]
    Love the link. The silent majority appreciates the logical, well reasoned analysis that you always give. The angry folks just write more - perhaps to release their anger. Although there is risk in every investment, you make a compelling case as to why PIP may go much higher.
    Nov 30, 2010. 05:57 PM | 5 Likes Like |Link to Comment
  • Superstitions, Myths, Folklore and Gold [View article]
    Most of us were not adults prior to 1971, when Nixon for the first time in our history refused to exchange US dolars for gold, so most of us only know the world of fiat money. Yet for most of human history gold has been linked to money (i.e Gold was money), so this 40 year time period is a relatively short time. The author is making an assumption that the fiat money system will go on forever. Speculators/Investors in Gold are making an assumption that this system will end, and we will return to a tradition that humans have had for thousands of years. The rise in gold is simply a reflection that gold will once again be money in the future (i.e the US currency and other currencies will be tied to it), and that US debt backed fiat currency will continue to be debased before that happens.

    Central banks/speculators/inve... are now buying up gold in the anticipation of a future (likely, IMO) event, namely, that this current system will fail through currency collapses via massive fiat money printing (to attempt to wipe out debts). This attempt to wipe out debt will be resisted by creditors, who will force a move once again back to a gold standard. Im not sure when it will happen, but if/when it does, once again: Gold will = Money. And at that time, gold will be at much higher prices relative to the US dollar. Yes, stocks and real estate will be much higher in nominal terms too, but not relative to gold. Gold/Silver are the best way to preserve our wealth during this likely transition, and buyers are buying Gold/Silver to insure themselves against it.
    Aug 15, 2011. 08:32 PM | 4 Likes Like |Link to Comment
  • China MediaExpress Holdings: All Eyes on Deloitte [View article]
    Its funny how Glen Bradfords bio says he "emphasizes risk averse investing", yet relentlessly pumped a fraudlently company like CCME.

    I really wish ARM Holdings was a publicly traded company because I would sell my house and short his company, which would be a sure risk averse bet.
    Mar 14, 2011. 05:31 PM | 4 Likes Like |Link to Comment