Testy Tuesday: How Many Times Will You Fall For The Same Thing? [View article]
Gosh, I would think someone calling themselves Jonathan Swift would realize the irony of comparing bottled water, with it's 1,000% mark-up to oil, which is the second most abundant liquid on earth.
Have you seen the Natural Gas market? That's the true measure of demand because there's not fake Iran crisis, no Nigerian rebels disrupting supplies and no OPEC to curtail production - just the law of supply and demand in action. If you don't trust nat gas, there's Coal (KOL) which is off 25% from last year or copper (a demand metal), also down 20% from last year (and that's after a 15% recovery since December).
Also, there's what I wrote in the main article but please, I'm not here to convince you - we need counter-parties!
Testy Tuesday: How Many Times Will You Fall For The Same Thing? [View article]
Check out last year's "Secret Santa's Inflation Hedges" - that's how we stay ahead of inflation. http://bit.ly/dWDOQY
So no, I'm not a perma-bear - I just don't like to be bullish when there's no evidence to support the position other than "the Economy is so bad the Fed is sure to save us."
Testy Tuesday: How Many Times Will You Fall For The Same Thing? [View article]
And there is nothing that pleases me more than Bush fans who don't listen to me as we always need counterparties and who better to take money away from than someone who would waste it looking for WMDs anyway?
Friday The 13th's Follow-Through Failure Forecast [View article]
Europe was a big topic of conversation in this week's Stock World Weekly, it's a free trial if you haven't tried it already: http://bit.ly/wf3mDE
TZA is a good choice - one of our disaster hedges along with SCO and EDZ. SCO is already a huge winner for us as we took them at oil $103.50. With TZA, rather than spend now $23.81 for the stock, we like to play a spread. For example, you can pick up the Feb $22/27 bull call spread for $1.50 and sell the $22 puts for $1.35 so you have the $5 spread for net $15 and your worst case is you end up owning them for net $22.15 so a bit of a cushion vs. owning the stock and, depending on your margin - you tie up less cash.
You can make that trade far less directional by using a different offset - something bullish you REALLY want to own if the market gets cheaper. Let's say, for example, you like BTU below $35 - you can sell the BTU Feb $34 puts for $1.45 and now you have net .05 on the $5 spread and if the market falls further, you get paid on the TZA and probably own BTU for net $34.05 but, if the market goes up and your TZA goes worthless on you - it's very unlikely BTU goes down and that makes your insurance play free.
There are many beaten-down stocks like X, CHK, TM, HPQ.. that you can use as bullish offsets to bearish hedges - it makes your insurance a lot cheaper when you play it like this but, of course, it's very important that you actually want to establish a long-term position in the offsetting stock you are selling puts against.
Monday Madness: G20 FinMins Set 2-Week Deadline [View article]
Well it's a simplification, of course. The point is that you increase the money supply by 50% and if we simply go back to the same level of consumption we had 3 years ago - then GDP expands by 50%. We're not consuming 33% less, there's a multiplying effect in between 0% and 50% and all sorts of numbers you can plug into a formula after spending a few years in grad school studying monetary theory but, the short story is - more money moving slower = steady GDP. More money moving faster = rising GDP. Rising GDP not keeping up with real gains in production/consumption = inflation. There's at least $35,000 worth of grad school for you!
Just Another Manic Monday: Value Investing [View article]
By the way, whenever you think a post is missing something, you can just click over to PSW, where any post that is up on SA is available for free viewing on our site as well (but not all of our free posts are on SA, so it's always good to check out our site). SA does not include videos and certain images for reasons I'm not quite sure of.
Just Another Manic Monday: Value Investing [View article]
Thanks Hans but this site edited the last sentence of my post where all I said was: "... so the bull will be flying – even if the markets are not!" I can't imagine why they did that but it's strange things like that which turn this site into the same generic drivel we get everywhere else on the web (except PSW, of course).
Tempting Tuesday: Murdochs Testify to Parliament [View article]
Oops, you are right, I was thinking income. Still, $900Bn added in one year is no small potatoes so that's $300Bn to Uncle Sam plus the corporate number stands so it's up to the other 309,999,000 of us to put up the remaining $1Tn shortfall - "just" $3,300 per person!
In March 2006 Forbes reported 793 billionaires in the US with combined net worth of $2.6 trillion. In March 2007 Forbes reported 946 billionaires in the US with combined net worth of $3.5 trillion. That is a 1-year increase of 19% in the number of billionaires and an increase of 35% in their net worth during a time of increasing poverty. Severe poverty is at its highest point in three decades.
So 946 people in the US generated $900Bn of ADDITIONAL income in one year. Had they paid a 35% tax rate (these top 0.0003%) then that $1.225Tn would have closed the entire gap in our national debt. Had the Corporations also paid a 35% tax rate – there would have been no need at all to collect ANY taxes (including SS and medicare) from the other 309,999,054 people in this country. I know how awful it would be to say to a group of people who are "only" earning an average of $3.7Bn a year each to only take home $2.4Bn – surely that’s not what our founding fathers would have wanted…
You are right, Pwe, it would be inhuman to ask the top 0.0003% to make such sacrifices. After all, what would be their incentive to get up and work in the morning if the government was just going to leave them with $2.4Bn after a hard year’s work? Thank goodness you have their backs – someone has to stick up for the creme de la creme!
Testy Tuesday: How Many Times Will You Fall For The Same Thing? [View article]
You seem like a well balanced guy so how about we give you a 3-month trial Membership and you can report to SA Members whether or not it's worth it?
I think you'll have fun reading our real stuff.
- Phil
Testy Tuesday: How Many Times Will You Fall For The Same Thing? [View article]
Testy Tuesday: How Many Times Will You Fall For The Same Thing? [View article]
Have you seen the Natural Gas market? That's the true measure of demand because there's not fake Iran crisis, no Nigerian rebels disrupting supplies and no OPEC to curtail production - just the law of supply and demand in action. If you don't trust nat gas, there's Coal (KOL) which is off 25% from last year or copper (a demand metal), also down 20% from last year (and that's after a 15% recovery since December).
Also, there's what I wrote in the main article but please, I'm not here to convince you - we need counter-parties!
Testy Tuesday: How Many Times Will You Fall For The Same Thing? [View article]
So no, I'm not a perma-bear - I just don't like to be bullish when there's no evidence to support the position other than "the Economy is so bad the Fed is sure to save us."
Testy Tuesday: How Many Times Will You Fall For The Same Thing? [View article]
Testy Tuesday: How Many Times Will You Fall For The Same Thing? [View article]
Testy Tuesday: How Many Times Will You Fall For The Same Thing? [View article]
Testy Tuesday: How Many Times Will You Fall For The Same Thing? [View article]
Friday The 13th's Follow-Through Failure Forecast [View article]
TZA is a good choice - one of our disaster hedges along with SCO and EDZ. SCO is already a huge winner for us as we took them at oil $103.50. With TZA, rather than spend now $23.81 for the stock, we like to play a spread. For example, you can pick up the Feb $22/27 bull call spread for $1.50 and sell the $22 puts for $1.35 so you have the $5 spread for net $15 and your worst case is you end up owning them for net $22.15 so a bit of a cushion vs. owning the stock and, depending on your margin - you tie up less cash.
You can make that trade far less directional by using a different offset - something bullish you REALLY want to own if the market gets cheaper. Let's say, for example, you like BTU below $35 - you can sell the BTU Feb $34 puts for $1.45 and now you have net .05 on the $5 spread and if the market falls further, you get paid on the TZA and probably own BTU for net $34.05 but, if the market goes up and your TZA goes worthless on you - it's very unlikely BTU goes down and that makes your insurance play free.
There are many beaten-down stocks like X, CHK, TM, HPQ.. that you can use as bullish offsets to bearish hedges - it makes your insurance a lot cheaper when you play it like this but, of course, it's very important that you actually want to establish a long-term position in the offsetting stock you are selling puts against.
Monday Madness: G20 FinMins Set 2-Week Deadline [View article]
Spark notes is good for this stuff: http://bit.ly/prNww9
Just Another Manic Monday: Value Investing [View article]
Just Another Manic Monday: Value Investing [View article]
Just Another Manic Monday: Value Investing [View article]
Tempting Tuesday: Murdochs Testify to Parliament [View article]
Tempting Tuesday: Murdochs Testify to Parliament [View article]
www.lcurve.org/images/...
In March 2006 Forbes reported 793 billionaires in the US with combined net worth of $2.6 trillion. In March 2007 Forbes reported 946 billionaires in the US with combined net worth of $3.5 trillion. That is a 1-year increase of 19% in the number of billionaires and an increase of 35% in their net worth during a time of increasing poverty. Severe poverty is at its highest point in three decades.
So 946 people in the US generated $900Bn of ADDITIONAL income in one year. Had they paid a 35% tax rate (these top 0.0003%) then that $1.225Tn would have closed the entire gap in our national debt. Had the Corporations also paid a 35% tax rate – there would have been no need at all to collect ANY taxes (including SS and medicare) from the other 309,999,054 people in this country. I know how awful it would be to say to a group of people who are "only" earning an average of $3.7Bn a year each to only take home $2.4Bn – surely that’s not what our founding fathers would have wanted…
You are right, Pwe, it would be inhuman to ask the top 0.0003% to make such sacrifices. After all, what would be their incentive to get up and work in the morning if the government was just going to leave them with $2.4Bn after a hard year’s work? Thank goodness you have their backs – someone has to stick up for the creme de la creme!