Ezzyme

20 Comments

    • ON: Sun Mar 16th 18:44 PM
      Commented on:
      Estimating KSW at 40% Below Fair Valuation
      Giovanni,

      Another HUGE problem is that TT and JCI are manufacturers and KSW is a contractor. KSW installs what TT and JCI make. You need to compare KSW with other specialty construction contractors with similar revenues.
      View article »
    • ON: Sun Mar 16th 16:15 PM
      Commented on:
      Global 'Oil Shock' Rattles World Stock Markets
      Speaking of mistakes, is it just me or was the fed funds peak 5.25%, not the 6.25% implied in the article? One problem at Seeking Alpha, which I have commented on in the past, is that once posted you are not allowed to edit your comments. I can only surmise it's the same for articles.....
      View article »
    • ON: Wed Feb 6th 13:45 PM
      Commented on:
      Lululemon Athletica: Heading for Single Digits
      Another Jones Soda.......
      View article »
    • ON: Fri Jan 25th 02:48 AM
      Commented on:
      Dear Ben and George: Time to Do Something
      Dear Alan,

      Please stick to picking stocks and calling markets. I'm in awe of your recent calls.

      The RTC was a disaster. One of the biggest waists of taxpayer dollars destroyer of real estate wealth. Banks had fire sales on REO in fear that they would be killed by the RTC. That in turn lowered market values putting more borrowers upside down on their mortgages increasing incentives to walk away etc. I could go on, but just know a similar agency for distressed loans and derivatives is a bad idea that would make things worse.

      Lowering interest rates IS the right idea. It makes all cash flow instruments more valuable. There is a price/rate for nearly every instrument. Even bonds for bankrupt companies with no chance of recovery have traded at a price, similar their stock, albeit for pennies on the dollar. But just as a lower rate makes a fix rate bond more valuable, so it makes any cash flow instrument more valuable even if it's thirty five cents instead of thirty cents to the dollar. Since liquidity, like everything else, is at the margin, all markets related to the FFR will become more liquid at the margin. I'm sure you'll agree that any increase in liquidity has a multiplier effect, just like any decrease has a negative multiplier effect. So, a decreases in rates can help turn this ship around.

      And how can it help real estate? Since many ARMs are tied to rates that relate in some way to the FFR, a decrease in the FFR within a few months directly reduces mortgage expense for at least a third of those with mortgages. It's like money for nothing and lower mortgage costs not only drove up housing prices but increased disposable income for millions earlier this decade. Lower payments will make it easier for the marginal home owner to stay out of foreclsure reducing foreclosures reducing the downward spiral effect. This is why I have been cursing Bernanke's miserly rate reductions of the past six months. If he had knocked a percent off in August and another one in October we would still have problems but we wouldn't be skidding over a cliff. Let's just pray he doesn't think he's done enough.
      View article »
    • ON: Fri Jan 25th 02:08 AM
      Commented on:
      Dear Ben and George: Time to Do Something
      Dear Alan,

      Please stick to picking stocks and calling markets. I'm in awe of your recent calls.

      The RTC was a disaster. One of the biggest waists of taxpayer dollars destroyer of real estate wealth. Banks had fire sales on REO in fear that they would be killed by the RTC. That in turn lowered market values putting more borrowers upside down on their mortgages increasing incentives to walk away etc. I could go on, but just know a similar agency for distressed loans and derivatives is a bad idea that would make things worse.

      Lowering interest rates IS the right idea. It makes all cash flow instruments more valuable. There is a price/rate for nearly every instrument. Even bonds for bankrupt companies with no chance of recovery have traded at a price, similar their stock, albeit for pennies on the dollar. But just as a lower rate makes a fix rate bond more valuable, so it makes any cash flow instrument more valuable even if it's thirty five cents instead of thirty cents to the dollar. Since liquidity, like everything else, is at the margin, all markets related to the FFR will become more liquid at the margin. I'm sure you'll agree that any increase in liquidity has a multiplier effect, just like any decrease has a negative multiplier effect. So, a decreases in rates can help turn this ship around.

      And how can it help real estate? Since many ARMs are tied to rates that relate in some way to the FFR, a decrease in the FFR within a few months directly reduces mortgage expense for at least a third of those with mortgages. It's like money for nothing and these lower mortgage costs not only drove up housing prices but increased disposable income for millions. This is why I have been cursing Bernanke's miserly rate reductions of the past six months. If he had knocked a percent off in August and another one in September we would still have problems but we wouldn't be skidding over cliff. Let's just pray he doesn't think he's done enough.
      View article »
    • ON: Tue Jan 22nd 02:22 AM
      Commented on:
      The Bear Turns Mildly Bullish
      Alan,

      Many thanks for your short term analysis. I bought QQQ calls on Friday (along with a couple out of the money puts). The oversold conditions and technical chart patterns have me still believing, but this is a short term trade. I have little doubt that we are heading for a major low in the next couple of months. As I see it, when the Fed chairman goes to congress and asks them to help while keeping the FF rate 1.4% above two year notes and above thirty years, we are screwed. With the Feds latest cash injection auction, the bids were 60 billion for a 30 billion offering at an average of just .05% under the FFR. Think of what the demand would be at 2.5? That's how much the credit markets are being starved. $100 billion fiscal stimulus? US equity markets alone have lost around $3 trillion dollars already! People have been predicting that the consumer is overburdened with debt and will cut back spending, and it hasn't happened - yet. But if jobs start shrinking the third shoe will have dropped. 0% interest rates won't help us then. Funny, having a student of the great depression presiding over what could turn into the next one.

      Lastly, corporate margins shrink much faster than revenues, as most have grown, and profits shrink exponentially faster.
      View article »
    • ON: Fri Dec 21st 14:10 PM
      Commented on:
      Syntax-Brillian: A Classic Bottom
      And I was wondering about those three price increases, what with everyone else cutting prices, aren't they hindering sales?
      View article »
    • ON: Mon Sep 10th 22:31 PM
      Commented on:
      iPhone Price Cut Causing Trouble For Apple
      Well, if you average the $100 price drop for the discontinued 4 Gb and $200 for the 8 Gb models, say $150 bucks times 10,000,000 Apple estimates to sell next year you get $1.5 BILLION dollars. The reduction in price does not facilitate a reduction in cost of goods. Therefore it only reduces PROFIT. $1.5 billion divided by 869,640,000 shares outstanding gives you $1.72 ($1.73 if you leave off the 640,000).

      Increased volume? How much? Or did they reduce the price because they might not have met their 10 million unit goal next year? It took them 74 days to sell 1 million. At that rate they would sell less than 5 million units next year.

      Reduced cost per unit? How much have costs fallen in 2 months? Do you think these costs aren't locked in for more than two months? Hedging works both ways. Lastly, I doubt there would be a serious component price decline in the unit volumes we are discussing and I would think Apple has all their internal projections covered.

      Did all the analysts anticipate this price drop? Did they anticipate it this early? How many units did they expect to be sold before this price adjustment? What was the rate of decrease in product adoption they projected versus when the price decrease would required?

      Yes, they are accounted for on the subscriber form. So my $1.72 is ONLY a $1.72 reduction in cash flow. It's a bit less in GAAP earnings. OK, a bit less than half. But why isn't anyone else making note of this? Am I missing everything? A $1.5 BILLION reduction in cash flow and the analysts dismiss it!

      I love Apple products, have since 1986. But can we call day day and night night?
      View article »
    • ON: Mon Sep 10th 06:30 AM
      Commented on:
      Mixed Emotions on Apple's Announcements
      The $150 avg per iPhone price drop at 10,000,000 units is 5% of 2008 estimated revenues! How is that "negligible"... "insignificant" or "1%"? Do these guys know how to work a calculator? Even on the "subscription&quo... basis of accounting over 24 months that's at least 2% drop in revenues. But the bigger significance is in the bottom line drop, at least $0.60 a share earnings reduction in '08.
      View article »
    • ON: Sun Sep 9th 22:11 PM
      Commented on:
      iPhone Price Cut Causing Trouble For Apple
      The rebate may be insubstantial but the price cut translates into an earnings cut of $1.73 for next year if they sell the 10 million phones they planned on selling and the analysts have been counting on them selling. I hardly call that insubstantial. At the current P/E of 38 that translates into $65 of share value, almost 50% of it's current value.
      View article »
    • ON: Sun Sep 9th 22:06 PM
      Commented on:
      Apple Appeases Pre-Price Cut iPhone Customers With $100 Credit
      This addresses the rebate, it doesn't address the $2 billion effect on next years earnings, hardly unsubstantial.
      View article »
    • ON: Fri Sep 7th 09:00 AM
      Commented on:
      Apple Tumbles On iPhone Price Cut; Analysts Leaving Estimates In Place
      Let's take this a little farther. Say component prices are the same and they only meet projections of 10 million iPhone sales next year. Let's split the difference between the 4 gig and 8 gig pricing and say the average price cut reflected in estimated future sales is $150. That's $1.5 billion not only in reduced revenue but in PROFIT. That $1.5 billion will come directly off the BOTTOM line. In this scenario, 2008 EPS will be reduced $1.72 and at a P/E of 38 that's a $65 stock value haircut. Thank you Steve.
      View article »
    • ON: Mon Jul 16th 09:54 AM
      Commented on:
      The True Cost of Insider Trading: The Case of Interactive Brokers
      Stocks are not a zero sum gain, options are.
      View article »
    • ON: Mon Jul 9th 11:40 AM
      Commented on:
      Jones Soda: What's Behind Its Recent Surge?
      How is the can distribution doing? Is it in stores in your area? Is it staying in stock? If not, is it because of outsized demand or supply problems? Many thanks!
      View article »
    • ON: Sun Jul 8th 17:24 PM
      Commented on:
      Is Rupert Ready To Close The Dow Jones Deal?
      Well said, I would cancel too if I subscribed. "Fair and balanced" to Murdoch means merely lip service to opposing points of view, portraying them as in-defensable.
      View article »
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