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AoxoMoxoA... Palindrome Or Conundrum? Threat Or Menace? Juvenile Jackanapes? Or Is It Just Retibulent Praecidualism?
Saturday, December 19, 2009, 02:35 PM
For a substantial portion of the American business and professional class, a book entitled "Life Without Lawyers" must surely conjure some of the same feelings evoked in faithful readers of the Harlequin romances, a sort of vicarious fantasy filled by the joy of liberation from burdens, strictures, and anxieties that have come to define quotidian existence. Such people are, in my experience, called clients.
-- Charles N.W. Keckler,
Seeya Raht Here Later This Weekend....
Meantime....
  ( 3 / 1208 )
Must Be Gettin' On Later In the Year.... I Find Myself Planking Salmon And Searing Steak Inna Cold And Dark. Real Manly Adventure With The Flavor Of White Hot Coals And Ice Cold Gin.
Saturday, October 24, 2009, 03:58 PM
Retail sales themselves are the best indicator of consumer sentiment as no device peers so deeply into the recesses of the human soul as the cash register.
--Howard Simons
Chartz And Table Zup @ www.joefacer.com
Or They Will Be When I Can Get On To The 401a Site...Is It Me? Or Is it Everybody? Good Excuse To Find Somethin' Else To Do Today....
TUESDAY
I've gone into capital preservation mode. Outside down days in key stocks, interday reversals in key stocks and indices, stocks going down on bad news/good news/no news/first class earnings beats, and then the few stocks that went up on first class earnings end up going down, That's A Deal Breaker.
I'm 73% bonds and GIC and the remainder mostly long AsiaPacific as a materials/growing economy thing. I may get all the way lighter on the little bit of domestic stocks I own in the 401a and lighter yet on the RERFX stuff. Stay Tooned...
My readings as posted here over the last 2 years made me way too cautious way too early and I missed most of the run up. I listened to Main Street and the more cautious parts of Wall Street and I saw the steam roller coming while it was still 8 miles away and I got out of its way. And stood around. I don't have the tools here in the 401a to pick up the few pennies still on the road and expect to get away cuz now I hear the steamroller and feel the rumblings. Man up, face up to a lost opportunity and get back to the curb.
Norway, Australia, Brazil, and India as of this evening seeing the end of the financial crisis on their turf and putting new fiscal and monetary policies in place in the weeks and months ahead. Prolly more nations doing so over the next few months. It is NOT the US leading worldwide policy response to our financial crisis. This is us facing the great unwind of the Money For Nothing , Cash For Free policy in a less benign set of circumstances and less control than we are used to.
I can't think of a lousier set of circumstances to start into the Holiday Season with short of being at war. oh, yeah.....
Bad News
Set up for some serious downside. I'm all but out of stocks and getting outa bonds....
Stay Tooned....
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Tick Tick Tick..... Earning Season Starts Inna Middle O' Da Week. Is My Strategy Deer Inna Headlights? A Rational Approach To A Critical Juncture Of Risk And Reward? Or The Result Of Random Neural Output From The Brain Of An Old Broken Down Pipefitter With Too Many Nights Of Sex, Drugs, And Rock 'n Roll And Too Many Days Of Twistin' The Wrist An' Chasin' Down The Racer Ahead And Runnin' From The Racer Behind...?
Saturday, October 10, 2009, 04:52 PM
It's all fun and games until someone gets hurt.
-- Mom
We are half a week from a fulcrum point. Think of a hallway with a door at each end. Ya open the door, walk through to the other door , open it, and walk through. Now think of the hallways set up in haunted mansions as death traps. Hinged in the middle, they are as solid as can be for step after step, until you take the first step past the middle. Then you are fucked. Think of Wednesday as getting close to the middle of the hallway. There are three hinges on the far door. Is there one inna middle of the floor?
Alcoa made 4 cents a share last quarter instead of the 9 cents a share loss that the street expected. The revenue was higher that Wall Street expected by 1.5%. But it was still down by 33% from a year ago. So the profit was made by grinding suppliers, closing plants, and laying people off. There is demand and there is a worldwide recovery under way. China is the difference. There will be more profits and more business done. Demand and prices will rise for raw materials and finished goods. The question is, will there be a national recovery here too and will future business and profits support the current US stock prices? It's a consumer economy (70%) in this country. Do you see a recovery ahead?
What it means here.... http://www.ritholtz.com/blog/2009/10/on ... ntraction/
The writers I read have given up on rationality. It looks like the internet and housing bubble to them. The thoughts are that this will end badly. Or maybe not. Things looked great at the start of 2000 and 2005 and looked like hell in March of 2009. How it looks to you today depends. The question is, is it 1998 or 2000? Is it 2002 or 2006? How long until employment launches skyward or stock prices implode? What would you do if you knew the answer? What would you do if you didn't?
Solid Gold Place To Start For The 401a Participant. http://www.thestreet.com/story/10608336 ... riend.html
http://www2.debka.com/headline.php?hid=6313
http://www.bloomberg.com/apps/news?pid= ... ZfOLKO2Zpk
http://www.msnbc.msn.com/id/33212991/ns ... d_economy/
http://www.cnas.org/blogs/abumuqawama
http://www.jconline.com/article/2009100 ... /910070345
http://www.msnbc.msn.com/id/33157665/ns ... vironment/
http://money.cnn.com/2009/10/08/news/ec ... /index.htm
Pretty much describes where my head is at....
http://www.ritholtz.com/blog/2009/10/th ... t-history/
Extremely thought provoking for the buy and hold 401a participant. It is not without holes, but I've read this book before and I can fill some of them in myself and interpret my way past others.
http://www.ritholtz.com/blog/2009/10/ho ... more-39371
Tick Tick Tick...
http://www.bloomberg.com/apps/news?pid= ... p2WcXs3fP4
http://www.bloomberg.com/apps/news?pid= ... z0hsBTTR4A
http://www.youtube.com/watch?v=wtIJ017J ... re=related
http://online.wsj.com/article/SB125530360128479161.html
Main St vs Wall Street
http://www.ritholtz.com/blog/2009/10/li ... nightmare/
I'm watching and waiting....
I've moved my 401a to an outsized position in cash for safety during a potentially very volatile time and for quick deployment back to stocks if an end of year run up starts. I have a smaller proportion in bonds for safety and income. I'm about 1/8 in EuroAsia as a weak dollar/commodity/growth play, and a tag end in small cap cuz I stopped one or two exchanges short. My Website has details to 4 decimal places.
Waiting....
FULCRUM DAY
You better be conservative or ready to turn onna dime.
http://www.ritholtz.com/blog/2009/10/getting-better/
It might be that things "Have Got To Get Better Inna Little While". If so there will be plenty of time for me to get way long then.
WED AM
Intel and JPM report good quarters and good/mixed forecasts. Economically, it is not ragingly bullish. But markets spike up. Fifty percent of S&P 500 revenues come from overseas. There will be profits and revenue. But domestic jobs, government spending, and housing are not going to move strongly in the right direction for a while. I think that realization has yet to be fully appreciated by investors. If the rest of the world raises interest rates or we have a lousy Christmas economy/housing drops another increment when rising rates make the FED/Treasury stop printing money, we could see a serious dip down. The near/long term upside is limited. Downside is less limited. It's about potentials, not imperatives. Listening to what the markets say and being ready to react to protect what you have today is as important as ever. I'm thinking about what to do with the 401a later today.
WED Afternoon....
Definitely feels toppish.
That said, I'm leaning toward tossin' in some 401a
money on the year end run up...
Stay tooned. To be continued....
GAWD!!! This Is A Mess! An Amazing Bear Market Rally, Mutual Funds, Hedge Funds, And Private Investors Who Missed It, End Of The Year Three Months Away, One Last Chance To Look Good, And A Dawning Awareness That 26 Million Unemployed And Underemployed Ain't Gonna Make For A Merry Christmas Shopping Season. Could The Markets Be Up At Years End? We'll See.
Saturday, October 3, 2009, 05:04 PM
"The Financial Instability Hypothesis suggests that over periods of prolonged prosperity, capitalist economies tend to move from a financial structure dominated by hedge finance (stable) to a structure that increasingly emphasizes speculative and Ponzi finance (unstable)."
-- Hyman Minsky
"I can dodge folly without backing into fear."
Nero Wolfe
Stay Tooned.
Ye Auld Regal Extraordinaree Especkial Thursday Night Post
Thursday, September 24, 2009, 08:24 PM
Lookie Here Boys and Girls..
CLICKIT!!!!!
We've come a long way in 7 months. We've had our dips and fits and starts, but from way too low, we've steadily gone way too high. Every time the market should have paused and corrected or churned sideways to correct in price or time, it resumed the climb.
Yesterday something changed. See....
Check out this week, especially at 2:15 P.M. Wed Afternoon
CLICKIT!!!
The Fed has been the market's friend. Yesterday it gave a good message to the market and the good news spiked the market up hard...and then the market sold off. And Wednesday was an Outside Down Day. (Ask me when you see me). Over the past 7 months, news, all news, good or bad, pretty much sent the market up. Yesterday's good news sent the market down. Today's bad housing news and good job news sent the market down. Ya gotta watch what the market does with the news it gets. Ya gotta especially watch for a change of character.
I'm now down to about 20% stocks/80% money from 60%/40% and 60% of the 20% is in offshore stocks.
I'm not confident and I'm major getting outa company and economy risk and getting into bonds and the GIC's security. I may go farther that direction Friday.
Nuttin' Clever Comes To Mind....An' My Elbow Hurts...You Fill It In For Once.
Friday, September 18, 2009, 11:01 PM
Thank you America, for the great choice between the spineless left and the lunatic right.
--Alan Farley
Stay tooned
http://www.youtube.com/watch?v=f64XZRRs ... re=related
http://www.ritholtz.com/blog/2009/09/wh ... ts-losses/
http://www.ritholtz.com/blog/2009/09/th ... r-sort-of/
http://finance.yahoo.com/tech-ticker/ar ... holtz-Says
My 401a is sixty four percent stocks and the rest in bonds. The market WILL crack. But I dunno when. All the people who mistrusted and hated this rally all the way up are standing by, ready to finally buy any pullback. And they've been waiting for months. But it is easier to plan to buy when stocks are going down than it is when they actually lose value. Some people (like me) gave up waiting for a pullback and bought in on the way up, supporting more upside. More will do so. But there are a lot of profits out there. And everybody who took partial profits on the way up ended up leaving money on the table. So there is a ton of pent up sales to protect profits hanging in mid air. If the whoosh down comes on major non market bad news, it could overwhelm and panic the dip buyers and become a self reinforcing cascade. But the pro's NEED to be up at year end to keep their jobs and they will toss in the kitchen sink to make it so. And the pols NEED to be up at the end of the year and into the '10 elections to be re elected so they will borrow and spend everything available to you, the taxpayer. But at least the money pros can lock the year in early by not waiting until the last week of the year to declare victory. It may end up a competition to sneak out the door early. But if you look at post 2000 to date as a bear market with one complete multi year bear market rally built on private debt and a partially complete bear market rally built on emotion and public debt, you face the possibility that the rally could have a ways yet to go.
Or maybe the PollyAnna's are right and the whoosh up since March is the market being a leading indicator about the bear market being
history and predicting a complete and total recovery in the months ahead.
There's a lot of rationalizations and possible outcomes. But there are two two measures of reality that are unequivocal and that are available to me in instantaneous and raw form; time and price. Markets are in a sustained uptrend after a gawdawful plunge and looking toppish, and I'm partially aboard with my finger on the eject button.
http://men.style.com/gq/features/landin ... tent_10957
Stay Tooned, Same Bat Time, Same Bat Channel.
Indian Summer In SF, 90 Degree an' Sunny, Music Inna Park, Saturday Off, Markets @ Yearly Highs, I'll Worry About Tomorrow Tomorrow...
Saturday, August 29, 2009, 03:13 PM
A knowledge of the path cannot be substituted for putting one foot in front of the other.
- M.C. Richards
TUESDAY EVE:
Sold some stock today, I'll finish selling tomorrow, leavin' only tag endz in the 401a fer tracking purposes. I'm mostly in bonds and mostly non gov bonds.
Hang On....
WEDNESDAY EVE:
http://www.usnews.com/blogs/flowchart/2 ... etter.html
'bout a month's worth of action. SPECTACULAR gains, a roll over, a pretty good bounce and just the start of a second rollover. But the character of the market has changed. The likelihood of a substantial risk to the downside is substantially greater. I read a lot and trade some two. It's for real, but not a done deal... but I'm lined up that way. Twelve percent stock and the rest bonds and GIC. YMMV.
See ya at the hall.
Yup... Unhuh Uhhuhh. EarlierThis Week I Decided That Knowing Too Much About What A Dire State The World Was In Was Costing Me Profits. I Emptied My Mind Of Caution And Moved To Almost 40% Stocks. Party On, Dood!!!!
Saturday, August 8, 2009, 12:01 AM
If you trade stocks in the short term, one of things that you need to be very aware of is that sometimes the action that seems extremely stupid is the best way to make money.
If a lot of people with a lot of money are chasing grossly overvalued stocks, it can feel pretty dumb to throw caution to the wind and join the party.
There are reams of sophisticated fundamental analyses out there that purport to establish what a stock is worth. What you need to realize is that the correlation between a stock's 'value' and the price it is trading at is very loose in the short term.
In fact, there can be a complete disconnect between the two for very long periods of time.
If you are going to trade in the short term, you need to decide whether you are willing to do the dumb things that make money or are you going to stick to the "facts" and stand aside while the idiots run prices up and down.
It's all about sentiment, mood and psychology in the short term, and it doesn't pay to think too hard about fundamentals if you are playing in the short term.
James “Rev Shark” DePorre
Charts and Table Zup @ www.joefacer.com
Thursday Evening.....
So far... So good.
The Unemployment Number Wasn't That Bad If You Knew Enough To Expect It And If You Could Play On The Dark Side Of The Street. Otherwise, If You Were Long Stocks In Your 401a, It Was A Big Asphalt Face Plant.
Friday, July 3, 2009, 01:36 AM
It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change.
-- Charles Darwin
http://www.bloomberg.com/apps/news?pid= ... llNt3iGquQ
http://www.bloomberg.com/apps/news?pid= ... obeTB25ZeY
http://www.bloomberg.com/apps/news?pid= ... quXjXBNKo0
http://www.ritholtz.com/blog/2009/07/usa-spendinggov/
http://www.ritholtz.com/blog/2009/07/usa-spendinggov/
http://www.ritholtz.com/blog/2009/07/usa-spendinggov/
http://money.cnn.com/2009/07/01/markets ... 2009070116
http://rothkopf.foreignpolicy.com/posts ... washington
http://www.ritholtz.com/blog/2009/07/un ... more-30927
http://www.bloomberg.com/apps/news?pid= ... WJtkeFK5yU
http://www.bloomberg.com/apps/news?pid= ... cWAOCmAfVo
http://www.nakedcapitalism.com/2009/07/ ... 5-ltv.html
http://www.calculatedriskblog.com/2009/ ... st-95.html
http://www.ritholtz.com/blog/2009/07/up ... ear-chart/
http://www.bloomberg.com/apps/news?pid= ... v4JRht6M4Y
http://www.ritholtz.com/blog/2009/07/th ... or-supply/
http://www.bloomberg.com/apps/news?pid= ... pK3J1JYpXU
http://trueslant.com/matttaibbi/2009/06 ... -a-chance/
http://www.ritholtz.com/blog/2009/07/mi ... the-world/
http://www.bloomberg.com/apps/news?pid= ... RLpgz65Qto
I got my answer. Unemployment re accelerating, work week hours at a record low, U6 unemployment @ 16.5% We've been going sideways and we ain't gonna launch upward in the immediate future. Employment is a lagging indicator, but we've been going up on "green shoots" and the deceleration of unemployment and housing depreciation. There have not been enough green in the shoots to tip consumer's mindset into the positive, unemployment re accelerated and every indication is that the housing workout will take much more time than hoped.
CLICK HERE
http://www.ritholtz.com/blog/2009/07/nf ... issection/
Here's my riff:
Decoupling;
Didn't work. The US sneezes, the rest of the world catches cold. Still true. Especially if they're awash in our mortgage backed securities and mortgages of their own. The reflation trade was just a trade, a headfake. Real economic recovery is still dependent on the consumer and the consumers mainstay is his job.
China will drive the world out of recession;
China is export driven and protectionist. Who are they gonna export to and who are they gonna buy from? Think about it.
Mortgage workouts;
Gimme a break. Fannie and Freddie can refi 125% LTV. So find me some borrowers who, 1) Need to refi and can/want to qualify for a $400K loan onna house now worth $325K. 2) Are then gonna take a non recourse mortgage and are going to turn it into a refi with recourse and that will require possible years to get them back to even. EVERYBODY WHO COULD FAKE AN APPLICATION, DID! Who's the new home buyers who will qualify under the new reality and bail everyone out at the old prices? This with the U6 measure of unemployment @ 16.5% (includes "discouraged, marginally attached,would like, and part time).
The banks are fixed and getting better;
Great profits with huge amounts of taxpayer supplied almost free money. Where do they put it to work? Does it make more sense to hang on to it and lose less of it while the economy finds the bottom, THEN loan it out?
I dropped into a local High End HiFi shop and mentioned that the week's unemployment figure came in at 467,000 vs the hoped for 325,000. The guy behind the counter went pale. This at a location that, if not recession proof, has the clients the least likely to hit the wall.
Things will eventually get better. But the time to be out of stocks was the 15 months previous to last March. The time to be back into stocks was March to the end of the day, June 30th.
Now we gotta reset reality as driven by 1)last quarters earnings, and 2) next quarters guidance.
Oh yeah, and financial markets news driven by rising unemployment, Iran and North Korea, and auto and manufacturing bankruptcies, municipal bankruptcies, Boeing DreamLiner delays, state bankruptcies and Afghanistan, and, and, and, and to a lesser degree by garden variety investment realities.
This insanely aggressive daytrader and momentum and position investor still has his 401a in the GIC and non governmental bonds. It's more important to keep what I made when times were good than to chase what may be there in a equivocal and possibly dangerous time..... There will be better days somewhere ahead.
AND CLICK HERE: http://www.youtube.com/watch?v=rUtlsk0l ... re=related
SATURDAY EVE
http://www.ritholtz.com/blog/2009/07/as ... ut-theory/
WTF????? Ban Short Selling??????
http://www.ritholtz.com/blog/2009/07/ba ... t-selling/
http://watchingthewatchers.org/indepth/ ... r-restrain
Stay Tooned...
Consider This And The Last Two Posts To Be Of a Cloth... Notice How Old Guys Use Archaic Expressions? The Expressions And The Old Guys Didn't Start Out Archaic.....
Saturday, June 13, 2009, 04:09 PM
A man must not swallow more beliefs than he can digest.
-- Havelock Ellis
Wed
http://www.cnn.com/2009/WORLD/meast/06/ ... index.html
http://www.msnbc.msn.com/id/31403377/ns ... al_estate/
http://www.newsweek.com/id/202323
From the 6/13/09 Economist;
All told the outlook is bleak. In a few countries, the financial crisis has badly damaged the public finances. Elsewhere it has accelerated a chronic age-related deterioration. Everywhere the short-term fiscal pain is much smaller than the long-term mess that lies ahead. Unless belts are tightened by several notches, real interest rates are sure to rise, as will the risk premiums on many governments’ debt. Economic growth will suffer and sovereign-debt crises will become more likely.
Somehow, governments have to avoid such a catastrophe without killing the recovery by tightening policy too soon. Japan made that mistake when concerns about its growing public debt led its government to increase the consumption tax in 1997, which helped to send the economy back into recession. Yet doing nothing could have much the same effect, because investors’ fears about fiscal sustainability will push up bond yields, which also could stifle the recovery.
The best way out is to tackle the costs of ageing head-on by, for instance, raising retirement ages further. That would brighten the medium-term fiscal outlook without damaging demand now. Broadly, spending cuts should be preferred to tax increases. And rather than raise tax rates, governments would do better to improve their tax codes, broadening the base and eliminating distortive loopholes (such as preferential treatment of housing). Other priorities will vary from one country to the next. But after today’s borrowing binge, doing nothing is no longer an option.
So it's like this.....ya gotta have a thesis.
Mine is that
the low of March this year was a panic low. The problems of 2007 supposedly had been fixed for good by early 2008 and by the time the Fall of 08 came around and things were headed for hell in a free fall pretty much everywhere, some serious downside momentum was in place. Coupla lower lows washed out all the sellers and left only shorts to sell.
Came the second week of March and people began to realize that even at 10 percent unemployment, 90 percent of the people would still be working, the employed and the unemployed would still be buying stuff, the government was shoveling money out of Ben's helicopters, and at some point inventories would be too low and products would have to be made and sold. Plus profit expectations had been driven into the ground by blind panic. So brave souls bought a little stock and the stretched to the downside rubber band snapped into motion. I caught a little of the move but missed that reality was ahead of expectations and I sold before the 1st quarter reports came out. DAMN!!! The reports were Better Than Expected. Stocks continued up without me and I fought myself over being late to the party vs arriving just as it cratered.
What now?
Well... stocks go too low and then go too high. There is a ton of money on the sidelines that missed the rally so far and CAN NOT MISS ANY MORE. There exist buyers desperate to buy. And interest rates are still fairly low. And the administration is cheer leading and papering over any signs of distress. And some places are still doing business and the rates of decline are slowing, possibly signaling a bottom and the headlines are about the bottom and the turn. But is it THE bottom...? Or just the end of a panic downdraft and the start of a long recession and extended trip across a flat economic landscape?
The rally looks tired. Stock prices pretty much discount a sizeable recovery. But the FED printed money like mad and now it has to borrow to fund what it printed. Bond buyers are offering less, fearing inflation, and that drives interest rates up and makes bonds a harder sell. That means that higher rates are needed on the bonds to raise the desired amount of money. That'll slow down refi's and new mortgages. The Fed will have to print more money and buy bonds to drive prices up and rates down, increasing fears of inflation. Which is the cause and not the cure. The Fed and administration have announced a flurry of plans, most of which are going nowhere. We have a ton of real housing inventory and an unknown amount of shadow inventory. The Fed offers the banks free money to start earning their way out of trouble. But the money is getting more expensive for the Fed to borrow and show me where the new business is for the banks to fund. Housing? Malls? Factories? Energy? Maybe... Wanna loan yourself some money through the government for a voucher to buy a new Chrysler SUV after you loan GMAC some money to fund your loan for the SUV? How about a house? Who's gonna buy your trade in? The Fed has entered into repo agreements with banks, taking toxic assets from them and giving back treasuries/cash. The mechanism by which the Fed can unload or make better the crap on its balance sheet and give it back to the banks/other investors is not apparent to me. The Great Unwind is still gotta happen and we're closer to the beginning than the end of flushing the crap away...
Check it out;
There is an important story in today's Telegraph about the increasing likelihood that some economically devastated U.S. cities may have to be partially bulldozed in order to survive. With cities like Flint, Michigan, having lost much of their rationale for existence, this should not come as a complete surprise. Nevertheless, this will be a difficult pill for "things will come back" America to swallow.
The government looking at expanding a pioneering scheme in Flint, one of the poorest US cities, which involves razing entire districts and returning the land to nature.
Local politicians believe the city must contract by as much as 40 per cent, concentrating the dwindling population and local services into a more viable area.
BLOW YER MIND...
http://www.telegraph.co.uk/finance/fina ... rvive.html
So my thesis is that we're going nowhere while things play out. I don't see a clearer road substantially up or down and I see a lot of resistance higher and a lot somewhat lower. But markets don't stand still. Fear and Greed and Hope and Despair will cause the markets to slosh around within a range. For how long? A week? A month? A year?
Check it out...
The Dow 30 was at 740 four times in 16 years and a ways above and below it. Buy and Hold? GIMME A BREAK!!!!! Tryin' to work with what the market gives me? Buy the dips and sell the rips? Make money that way? Prolly.... I'm gonna try
I committed a significant amount of my account to stocks earlier in the month to get back inna game. It didn't look that good, but I needed to re-engage my interest. So I made a dollar or two last week. Lately, not so much. I moved some money outa stocks and into the GIC this Friday, leaving some in stocks. There are buyers still trying to get into the party when the door opens for someone to leave... There may be a little more to go. But the easy money and a lot of it has already been made. The resistance seems greater to the upside than the downside and I'm more likely lighten up on stocks than buy more.
Tuesday Night
I lightened up some on stocks on Monday and I'm lightening up almost all the way tomorrow at the end of the day.
It's a mind game thing. Know what I mean, Vern?
Being all out of the market worked so well for sooo long that I got way too comfortable. I let waay too much money get away when the market spiked huge for three months and I watched it run away from me. Time to blow out the cobwebs, re-engage my brain, and get to work. I tossed a few dollars into the maw of the beast by committing about half my portfolio to stocks. I knew it was prolly way too late, But I hadda start somehow and somewhere. I watched enough bucks go up in flames to get my attention. Enough of that crap. Lemme see if I can make a dollar in a volatile and directionless market. If that's what we get....
Game on.
Stay Tooned
This Week's Post Is What Shoulda Appeared In Last Week's Post. That's Why The Quote At The Top Is The Same. I Couldn't Find A Better One For The Purpose.
Saturday, June 6, 2009, 02:05 PM
The one great certainty about the market is that things will always change. When we lose sight of that fact and dig in our heels on a particular viewpoint or thesis, it can create tremendous stress as we deal with an environment that may not appreciate our great insight.
Reverend Shark
Chartz and Table Zup @ www.joefacer.com
Lemme dig my way from outa a big pile of offput chores/obligations/ behests an' other crap an' I'll tell ya why I've averaged 11% return plus or minus since 9/04 an' why I'm up 55% plus or minus since 9/04 an' why IT PISSES ME OFF!!!!!
From MSNBC, Bloomberg, and Big Picture links below
“I suspect that we will continue to need a trillion dollars' worth of deficit financing, fiscal stimulation, for several years at least," said Bill Gross, managing director of Pimco, which runs the world's largest bond fund. "This economy is still de-levering. It is still at the whim, so to speak, of savings vs. consumption. It is deglobalizing. It is reregulating. These are forces that slow growth."
“I don't see where the second half recovery is coming from,” said David Rosenberg, chief economist at Gluskin Sheff, a Toronto–based investment firm. “Until employment stops falling, this recession is still intact."
The government probably wants to win time for the banks, keeping them alive as they struggle to earn their way out of the mess, says economist Joseph Stiglitz of Columbia University in New York. The danger is that weak banks will remain reluctant to lend, hobbling President Barack Obama’s efforts to pull the economy out of recession.
Citigroup’s $1.6 billion in first-quarter profit would vanish if accounting were more stringent, says Martin Weiss of Weiss Research Inc. in Jupiter, Florida. “The big banks’ profits were totally bogus,” says Weiss, whose 38-year-old firm rates financial companies. “The new accounting rules, the stress tests: They’re all part of a major effort to put lipstick on a pig.”
Further deterioration of loans will eventually force banks to recognize losses that their bookkeeping lets them ignore for now, says David Sherman, an accounting professor at Northeastern University in Boston. Janet Tavakoli, president of Tavakoli Structured Finance Inc. in Chicago, says the government stress scenarios underestimate how bad the economy may get.
Citigroup also increased its loan loss reserves more slowly in the first quarter, adding $10 billion compared with $12 billion in the fourth quarter, even as more loans were going bad. Provisions for loan losses cut profits, so adding more to this reserve could have wiped out the quarterly earnings.
Wells Fargo
Without those accounting benefits, Citigroup would probably have posted a net loss of $2.5 billion in the quarter, Weiss estimates. In the five previous quarters, Citigroup lost more than $37 billion.
Wells Fargo also took advantage of the change in the mark- to-market rules. The new standards let Wells Fargo boost its capital $2.8 billion by reassessing the value of some $40 billion of bonds, the bank said in May. And the bank augmented net income by $334 million because of the effect of the rule on the value of debts held to maturity.
Wells Fargo spokeswoman Julia Tunis Bernard declined to comment, as did Citigroup’s Jon Diat.
The higher valuations Wells Fargo put on its securities probably won’t last, as defaults increase on home mortgages, credit cards and other consumer and corporate lending, Northeastern’s Sherman says.
Fed’s Optimism
“These changes will help the banks hide their losses or push them off to the future,” says Sherman, a former Securities and Exchange Commission researcher.
The Federal Reserve, which designed the stress tests, used a 21 percent to 28 percent loss rate for subprime mortgages as a worst-case assumption. Already, almost 40 percent of such loans are 30 days or more overdue, according to Tavakoli, who is the author of three primers on structured debt. Defaults might reach 55 percent, she predicts.
At the same time, the assumptions on how much banks can earn to offset their losses are inflated, partly because of the same accounting gimmicks employed in first-quarter profit reports, Weiss says.
“There’s a chance that it might work,” Columbia’s Stiglitz says of the government’s attempt to boost confidence. “If it does, then they’ll look like the brilliant general. But all these efforts also bank on the economy recovering and housing prices not falling too much further. Those are not safe assumptions.”
The package the White House hammered together to convert big, old, dying Chrysler into a smaller, healthier car company looks a lot like a massive violation of bankruptcy law. A few dissident creditors, namely three Indiana pension funds that banded together, remain defiant enough to say so.
The Chrysler plan “seeks to extinguish the property rights of secured lenders, trampling the most fundamental of creditor rights in disregard of over 100 years of bankruptcy jurisprudence,” the funds argued in bankruptcy court papers.
http://www.msnbc.msn.com/id/31121449/
http://www.newsweek.com/id/200991
http://www.msnbc.msn.com/id/31127909/
http://www.msnbc.msn.com/id/31143910/
http://www.msnbc.msn.com/id/31150694/
http://www.msnbc.msn.com/id/31110346/
http://www.bloomberg.com/apps/news?pid= ... _5hvV_xqHM
http://www.bloomberg.com/apps/news?pid= ... C3LxSjomZ8
http://www.bloomberg.com/apps/news?pid= ... iTT6yxgHSE
http://www.bloomberg.com/apps/news?pid= ... eYe_j75qvM
http://www.bloomberg.com/apps/news?pid= ... 2TV3oJtap4
http://www.bloomberg.com/apps/news?pid= ... tKbzvooAy0
http://www.ritholtz.com/blog/2009/06/it ... one-trade/
http://www.ritholtz.com/blog/2009/06/ho ... d-minuses/
http://www.ritholtz.com/blog/2009/06/pa ... rate-fell/
http://www.ritholtz.com/blog/2009/06/an ... ent-truth/
http://www.ritholtz.com/blog/2009/06/a- ... les-ahead/
http://www.ritholtz.com/blog/2009/06/th ... more-28300
http://www.ritholtz.com/blog/2009/06/tr ... licyuh-oh/
This is what the Funds available to the 401a have done since the time they became available (Since I got serious about 401a investing).
This is the period in which I went long and strong in stocks, at times almost 90% to 95% stocks.
This is the time period during which I was in cash (GIC) or bonds. Pretty kool so far.
This is the three month time period during which I was partially invested in stocks for about 4 or 5 weeks. IT PISSES ME OFF. For a trend follower intent on finding a trend and riding it as long as I could, I left WAY too much on the table when stocks turned up and kept going up. Lesson learned. I just moved a significant amount of my 401a back into stocks. Not because I think that there is a lot left to this move or that the market owes me what I missed out on. Rather, I did really well in a bull market 'cuz ya can't tell the idiots from the geniuses when everything is goin' up. I also did really well in a bear market because when hunkering down and playing possum is a brilliant strategy, it's really easy too. But now I expect a very volatile and range bound market. And that is a very different animal. It might be a bloody and frustrating market for an extended period. It also might offer the opportunity to make some aerious bucks with effort, smarts and luck. So i tossed some serious money into the action. Nothing quite like skin in the game to dial the focus and intensity up.
Stay tooned
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