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  • Precious Metals Fundamentals More Bullish Than Anytime During The Entire Bull Market [View article]
    Agreed. A bet on PM is a short bet against USD. If we are heading into a crisis in Europe, it's a bad time to bet against the dollar.
    Dec 29 12:56 AM | Likes Like |Link to Comment
  • Mired in the "mother of all trading ranges," Wal-Mart (WMT) shares have been stuck in a trading range for nearly 12 years, Eddy Elfenbein notes. Not once in more than 3,000 trading days has WMT closed above $64 or below $42; more than 78% of the time, the stock been between $48 and $59.99.  [View news story]
    They tried it by changing their business model (going for more upscale segment than focusing on everyday low prices); 'didn't work and had to return to the old business model (which I thought was responsible for their relative outperformance in recent months).

    Anyways; the way I see it, WMT is showing exactly what the 10-year secular bear market is supposed to look like---a consolidation market. When this ends and secular bull market starts again, hopefully the retailer will rise with the rising tide.
    Dec 28 06:04 PM | Likes Like |Link to Comment
  • Market recap: Stocks finished near their worst levels, with the S&P falling into negative territory for the year, as the euro tumbled to 15-month lows after the ECB reported European banks had deposited a record amount. Financials were among the weakest stock sectors; commodities were clobbered. NYSE declining issues outnumbered advancers four to one.  [View news story]
    "with the S&P falling into negative territory for the year": a gift to hedge fund managers who *are* going to end the year negative and would rather see their benchmark negative than positive?
    Dec 28 04:20 PM | 1 Like Like |Link to Comment
  • The housing crisis is five years old. But for local governments that depend heavily on property taxes, the lag between falling home values and property re-assessments means the housing market bust is just beginning to ravage tax revenues.  [View news story]
    I didn't know local governments kept a standing army.

    In seriousness, perhaps state governments spend some small amount for upkeep of national/coast guards, but in terms of city and municipal government, every dime of spending is non-defense spending---so what's stopping them from cutting them?

    (On the other hand, as a small-government conservative, I do think a vast majority of federal spending *should* be defense spending---one that's smaller in dollar amounts than what we are spending now, but one that's vastly larger in percentage (at least of discretionary spending) than what we have now.)
    Dec 27 12:46 AM | 2 Likes Like |Link to Comment
  • The housing crisis is five years old. But for local governments that depend heavily on property taxes, the lag between falling home values and property re-assessments means the housing market bust is just beginning to ravage tax revenues.  [View news story]
    Well, except in New Jersey. Thankfully, the GOP governor there had the foresight to constitutionally cap the property tax rate last year.
    Dec 26 07:48 PM | 6 Likes Like |Link to Comment
  • Looking back 15 years, Citigroup finds it best to stick with winners entering a new year and stay away from the past year's dogs. Buying the dogs only seems to work well at major macro turning points - 2000, 2003, and 2009 being the only years when they outperformed, a cautionary idea to those who want to buy beaten-down financials just because they're cheap.  [View news story]
    Well. That's the whole point behind momentum investing. There was a Morningstar interview with those guys where they tried to explain why momentum investing edge hasn't been arbitraged away ...
    Dec 23 03:14 PM | Likes Like |Link to Comment
  • House Republicans cave to Pres. Obama’s demand for a two-month payroll tax cut extension. House Speaker Boehner says his side has ended its opposition to the extension in return for new language in the legislation to make it easy for business payroll staff to process the tax cut.  [View news story]
    That was the entire GOP objection (that it'd be a tax-accounting nightmare, 2-month not even corresponding to a quarter that a lot of employers do their tax periodically on), but, oh well, politics is politics.

    Just because your position is logical and rational doesn't mean you can ignore the optics and the opponents who are willing to go back on their prior words (Obama and Democrats *wanted* 1 year extension to start with; proof? Obama's number of $1000 tax saving is based on 1-year extension, not the 2-mo extension that Democrats supposedly want now) and demagogue your position as much as the media would let them.
    Dec 22 11:02 PM | 1 Like Like |Link to Comment
  • Vanguard founder John Bogle on tax fairness: "Rates may have to be changed, but we also need to look at what is taxed, and how. Dividend income should be taxed at the same rate as ordinary income. As for capital gains, there ought to be some distinction between capital made by people who start businesses, and contribute value to society, and capital made by gamblers on Wall Street."  [View news story]
    Er, so is he advocating much change at all? He speaks as if we don't already tax short-term capital gains (i.e. capital gains from positions held for less than a year) as ordinary income. Long-term capital gains are already taxed at the special capital gains tax rate.

    Other than advocating for higher taxes on dividend, it sounds like the man is more or less for status quo---he just makes it sound as if he isn't.
    Dec 22 10:35 PM | 1 Like Like |Link to Comment
  • The Winter Resolution Of 2012, Or The Great Relief [View article]
    Well, so you think that the market will continue to be nontrending (which it has been since May or so; the bear moves have not been big and lasting enough for the overall market for trend-followers to profit significantly). Michael thinks that it will start to trend soon (either into a bear market and recession, or continued bull market at least for a period).

    To traders, it matters which of the two views are right: if you are right, the contrarian trades will be profitable; if Michael is right, trend-following strategies will be profitable.
    Dec 22 03:10 PM | 1 Like Like |Link to Comment
  • Following reports that RIM (RIMM) has been a takeover target of several companies, Globe & Mail writes that the reason a deal hasn't happened is because Microsoft (MSFT) and others were scared away by the “rapid deterioration” of the BlackBerry business. But the report notes that RIM is resistant to a takeover until it sees how the new QNX smartphones are received.  [View news story]
    Sounds like takeover just can't happen: if their new smartphones do well, RIM wouldn't want to sell itself; if their new smartphones don't do well, more potential suitors will get scared away.
    Dec 22 10:34 AM | Likes Like |Link to Comment
  • The NLRB adopts a rule that will speed union organizing elections in private-sector workplaces that also aims to eliminate "unnecessary litigation" that occurs during elections, ushering in some of the biggest procedural changes in decades. Many employers say the new rule leaves them inadequate time to respond to unionization campaigns.  [View news story]
    If they were mere serfs, they wouldn't be free to quit the job they have. But indentured servitude is illegal in U.S. (formally); if they don't like the wages, they can find someone else who'll pay better.
    Dec 21 02:53 PM | 1 Like Like |Link to Comment
  • The Swiss franc strengthens a bit after the country's parliament votes against a motion for the government to create a legal framework for negative interest rates. Earlier the franc had strengthened when the Finance Minister said negative rates were among the tools the country had to combat the currency's strength. FXF -0.2%.  [View news story]
    How would negative interest rate even work? Are they going to make it illegal for institutions to hold more than a certain amount of CHF? Why would anyone (that is, anyone but a central bank) loan cash at assured loss?
    Dec 21 12:51 PM | Likes Like |Link to Comment
  • Google (GOOG) throws rival Mozilla a bone, renewing for another 3 years a search engine deal for Firefox that accounted for 84% of Mozilla's 2010 revenue. Google's Chrome is believed to have recently surpassed Firefox as the world's second-most-popular browser.  [View news story]
    I'm not sure if "enemy" is the right term. People may not remember this, but at one point, Google's motto was "don't be evil" (this was when Google was the anti-Microsoft, not, as some people call it these days, a poor imitation of MS). Their supporting Mozilla (along with their annual Summer of Code) probably has little to do with corporate profits and more to do with maintaining their reputation.
    Dec 21 02:50 AM | Likes Like |Link to Comment
  • Research In Motion (RIMM) +7.2% AH after Reuters reports the company turned down takeover overtures from Amazon (AMZN) and other potential buyers because it prefers to fix its problems on its own. Amazon reportedly hired an investment bank this summer to review a potential merger with RIM, but it didn't make a formal offer.  [View news story]
    Apple isn't a software company; it's always been a hardware company who wrote its own software.

    Anyways. That's probably why Jeff Bezos wanted to buy RIM rather than build the operation from ground up. Also, any connection between this and Kindle Fire's similarity to RIM PlayBook? Original story was that both were made by the same ODM, explaining the design similarities, but maybe the background story goes deeper.
    Dec 20 10:23 PM | 1 Like Like |Link to Comment
  • Deflation Rears Its Ugly Head In Bond Market [View article]
    This seems like a very tough market to do any sort of forecast on. Just as it looked like we were headed downhill, Spain had a good bond auction.

    I think it's understandable though; when the message from central bankers (the only guys influential enough to turn the market on a dime) are all mixed (a couple weeks ago, it was central bankers' unity day; then it was ECB's Draghi pulling the rug under the market, then it was a French central banker calling for a bank run on U.K., and now is ECB perhaps engaged in bond-buying action despite its protestations?), there doesn't seem to be any message/sentiment that can be relied on for longer than a week.
    Dec 20 12:25 PM | Likes Like |Link to Comment