E Nuff Sed

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  • Satyam: A Shameful End
    I can't believe PWC did not even verify the cash on hand. What are these guys guys collecting auding fees for? Seems to be prima facie case of incompetence and negligence.

    I hope they get sued for every dime by the investors.
    Jan 07 20:15 pm |Rating: +2 0 |Link to Comment |View article
  • Satyam Scandal: India's Claim to Ponzi Fame
    Well the Satyam ("truth" in Sanskrit) has emerged from this pile of dung.

    Warren Buffet saying that "when the tide goes out, you see who is swimming naked" is so true - and so is the cockroach theory of investing. When you see one or two roaches come out of the woodwork - sell and run for the hills - there something rotten behind those shining walls.

    We have seen this again and again with Madoff, AIG, Citi, Enron, Worldcom to name a few.

    Unfortunately I learnt this lesson the hard way with AIG and Worldcom. Never again!
    Jan 07 20:07 pm |Rating: +2 0 |Link to Comment |View article
  • Sirius' Future Looks More Promising Than Ever
    I think given the huge debts the current investor would get diluted to almost nothing.

    Brandon, buying into debt for 12 cents on the dollar may be a better bet as it would likely get converted into equity after the re-org.
    Jan 03 18:08 pm |Rating: +2 0 |Link to Comment |View article
  • The Sad Semi Stocks: J.P. Morgan Sees a Bottom
    Semi's are among the first sub-sectors to recover from a recession. I see them as bell-weather stocks and will be watching them closely and see if hardware stocks (like Dell etc.) will follow.
    Jan 03 01:08 am |Rating: 0 0 |Link to Comment |View article
  • Firesale Prices Could Mean Equity Returns for Loan Investors
    Good article - low risk, high return.

    PFN - closed end fund which invests in bank loans. Current distribution is *drumroll* 32%.
    Dec 31 22:18 pm |Rating: +1 0 |Link to Comment |View article
  • The Invisible Stimulus
    There is a real danger that the economy might get over-stimulated in the short term. Another stimulants which is not well appreciated in the price of oil - which (compared to earlier this year) is like a trillion dollar stimulant to business and consumers.

    With all these stimulants (fiscal, monetary, intentional & non-intentional) we could have high single digit inflation in 5 years.
    Dec 31 12:37 pm |Rating: 0 -1 |Link to Comment |View article
  • Preventing the Depression of 2009
    Brilliant. Seems like a no-brainer.

    Given that the government now can sell 10 year bonds today at 2.1% yield - the dividend alone on S&P 500 is at 3.31% (ttm) will much more pay for the loan.

    The profits from this intervention would be massive - a couple of years down the road. Investor psychology would be reversed and the govt. can control any bubble by selling the index when it feels the market is fully valued.

    To me this is no different from currency market or interest rate manipulations which government do all the time.

    This is also what sovereign wealth funds are doing.



    Dec 30 22:48 pm |Rating: 0 0 |Link to Comment |View article
  • Buy, Sell or Hold: BHP Billiton Could Actually Rally Amidst the Bad News
    Good article - BHP is indeed the strongest of the bunch. The company being debt free is a huge plus in this environment.

    However I worry that more declines are ahead - private sector demand is collapsing while the effects of the stimulus's are still about a year to two away. 2009 could be rough for commodities.
    Dec 30 22:25 pm |Rating: +2 0 |Link to Comment |View article
  • Two Calculated Risks Possibly Worth Taking
    The story on LDK looks good and it is trading at very very low valuation relative to projected growth (PEG 0.1).

    The issue to my mind is can you trust their accounting? I hear chinese companies keep 3 sets of books - one for investors, the 2nd for the chinese govt and 3rd for the spouse.
    Dec 30 19:54 pm |Rating: +1 0 |Link to Comment |View article
  • 2009: Expecting a Massive Rally
    My strategy is to play this via a rotation strategy. I plan to rotate from high grade corporates to high yield to preferred to defensive equities to growth. My theory is that after the mauling we have suffered from the bears we the investors need to be slowly incited into the market. The low hanging fruit needs to be picked first before we venture into the canopy of the jungle.

    There is a bull market in corporate bonds now. LQD has blasted past 10, 50 and 200 DMA after putting in a double bottom in October.

    Junk bonds (HYG) are doing the same now and have blasted past 10 & 50.

    Preferred (PFF) are just a little further behind.

    I notice that S&P 500 has just crossed the 10 DMA (first time since the September cliff) Next resistance is at 50 DMA. That may be a signal to buy defensive equities.






    Dec 30 17:39 pm |Rating: +4 -1 |Link to Comment |View article
  • General Electric: Not Quite a Value Trap, More Like a Value Pit
    I acknowledge that GE faces near term turbulance because of its finance unit and likely down grade to its AAA ratings. Further turbulence should create a once in a life time buying opportunities.

    A lot of the fears you are talking about are already priced in at the stock price of >$16. I think GE is worth closer to $30. There is a high probability this price will be realized when the recession is over and growth resumes in 2 to 3 years.

    GE is extremely well positioned, and in fact embedded in the giant emerging economies like Brazil, India and China. It is also a great infrastructure play and should benefit from the stimulus. It is also one of the biggest health care companies.

    Also GE is likely to monetize its valuable assets like NBC and appliances when the market recovers. It will likely reinvest the proceeds into emerging markets.
    Dec 30 16:35 pm |Rating: +1 0 |Link to Comment |View article
  • Cramer on Ultra-Short ETFs: Just Plain Wrong
    I am not sure that Cramer is not right at least partially right.

    For example - a small number of speculator's took Oil to $149 . Compared to the fundamental market of oil, speculators are a small part - but their effect on prices were massive.

    The price for a fungible commodity (like equities) at an instant of time is driven by the last stock traded.

    Therefore when leveraged commodity like a ultra bear etf is rebalanced at the end of the day its creates a turbocharged momentum in the market, i.e. if a market has been falling all day - at the end of the day its off on a cliff, and vice versa.

    I am not sure how these ETF's are contributing to the functioning of the market apart from making it more volatile. The basic fact is the stock market with these kinds of dubious innovation is looking more like a casino on steroids rather than a mechanism for capital allocation and price setting.
    Dec 30 00:18 am |Rating: +4 0 |Link to Comment |View article
  • Deepwater Drillers: Not in a Very Deep Hole
    The best solution for a lay investor is to buy a closed end fund like PEO. With 0.5 expense ratio you gain a diversified oil related portfolio as well as expertise in the field. Bonus: It is selling at a discount to net asset value.
    Dec 28 12:57 pm |Rating: +2 0 |Link to Comment |View article
  • Bits of Destruction: Blame the Internet
    You make good debating points - but the internet cannot disintermediate everything, the success of Google and Amazon notwithstanding.

    For example I still need to test drive a car before I buy it. I cannot see dealerships disappearing. As my assets have grown, I feel the need of a personal relationship with a banker. All these industries are increasingly using the internet to extend a deepen relationships with clients but are also equally reliant on brick and mortar installations.
    Dec 27 20:29 pm |Rating: 0 0 |Link to Comment |View article
  • Crash Confidence Looks Bullish
    If someone could chart the sentiment of seeking alpha comment stream, I think we could come to a similar contrarian conclusion.

    My subjective impression is that comments on alpha are overwhelmingly bearish and the doomsayers are partying and dancing on the graves of bulls.
    Dec 27 14:45 pm |Rating: 0 -1 |Link to Comment |View article

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