I live in the USA and I am concerned about the future. I created this blog to share my thoughts on the economy and anything else that might catch my attention.
Dr. Strange Move or How I Learned to Love the Bill
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After a couple of years of disinflation, the Fed changed directions and
started lowering rates. By most measures, the economy had been humming
along near a...
NVIDIA Revisited
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On August 26, 2023, 5 days before it a new closing hi at 493.55, I wrote a
critical post about NVDA - the stock, not the company. After that, the
stoc...
Stay away from popular tech stocks, part II
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Last August, I wrote a blog post arguing that largest technology and
internet companies -- Amazon, Apple, Facebook, Google, Microsoft -- would
never grow i...
Updating the HF Indicators
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I posted this over on Seeking Alpha.
Not much good seems to be happening, and I am concerned about the low pace
of construction and a likely end to the sho...
Yes, Well, It's Still a Friday Night
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I doubt anyone is still reading the old stuff, but I have a quiet Friday
night and figured, why not a Friday Night Rock Blog?
I found this one recently (...
You should be buying things and accept that they're overvalued, but accept that they will keep going higher. I know that sounds irresponsible. - Jim Cramer, October 31, 2007
When have I heard that before? Oh, I know. The year was 2000.
How did this bizarro world where nine-tenths of the companies I have followed as a stock picker for the last 20 years are losers and one-tenth are winners? To answer that question, you have to throw out all of the matrices and formulas and texts that existed before the Web. You have to throw them away because they can't make money for you anymore, and that is all that matters. We don't use price-to-earnings multiples anymore at Cramer Berkowitz. If we talk about price-to-book, we have already gone astray. If we use any of what Graham and Dodd teach us, we wouldn't have a dime under management. - Jim Cramer, February 29, 2000
They say that nobody ever rings a bell at the top. Really? Cramer's my cowbell hero. A legend is born.
5 comments:
Anonymous
said...
Stag,
Just how does Cramer still have an audience? It's mind boggling. I'm surprised he doesn't need disguises or body guards.
The entire Cramer phenomenon would be comical except for the financial damage he is causing to so many innocent investors (aka fools). Buffett never should have validated CNBC with all those appearances.
I suspect we'll be reading about some seriously underfunded pensions over the next few quarters - public & private.
That commodities rally today really has the fed & treasury boxed in.
You don't get what you want, you get what you earn.
Seriously. If you ever start feeling bullish just peruse the Coach website and contemplate the debt/credit backed by all those valuable handBAG(holders).
That kind of vanity can only exist during a wild credit boom.
Coach has been pre-disastered. Some might argue it is safe to buy now (not me!).
September 9, 2008 Is a "Pre-Disastered" Portfolio Safe? http://www.fool.com/investing/value/2008/09/09/the-stock-market-isnt-fair.aspx
This kind of thinking is akin to how value investors view the stock universe. They tend to seek out stocks that have been slammed for some reason, and that can be expected to turn themselves around, appreciating in value. They hope all the bad events have already happened, and that perhaps good things lie ahead.
For what it is worth, Coach closed that day at $29.59. It is now $27.60.
If you are looking for a serious pre-disastered pick though, there's always Jones Soda. It's been pre-disastered down to $1.29. It's a "case" study of "halves" vs. "halve" nots. It's been "halved" a lot.
I found it amusing that one of the biggest bagholders in the known universe was gloating to other bagholders that they were bagholders. I'm an equal opportunity heckler, and that just didn't seem right.
The next day I was back to warning the longs though.
A lot of investors were burned by the dotcom bubble. They learned to look at the P/E. They think they understand it fully now. Only one problem. Most investors have never seen a consumer recession. We haven't had one since 1990. They don't seem to understand that it isn't just the "P" that can change. The "E" can change very quickly too.
I think it is safe to say that those investing in banks (with their relatively low P/Es even back then) have been learning that the hard way.
Further, there seems to be a serious "hysteria" containment problem these days.
By the way, you might want to read the bull's reply as well.
I have no idea where this hysteria ends up. I guess nobody does, but I will give you one name. Thornburg Mortgage. Actually, it used to be touted by Cramer.
Its assets are pristine.
Here's a glimpse of the pristine (as of yesterday).
Thornburg Mortgage Back on the Ropes http://www.housingwire.com/2008/09/16/thornburg-mortgage-back-on-the-ropes/
What’s amazing here is that Thornburg isn’t failing because of rising credit costs per se, or because of a foray into subprime lending; it’s failing because (like many firms) it was leveraged and maintained an investment portfolio of mortgage securities that have quickly headed south as the mortgage market has fallen apart.
Isn't hindsight fun? The pristine now trades at 30 cents. Nice tout Cramer! I knew I'd be able to squeeze another dig out of this if I just kept rambling. All dots connected eventually end there (spectacularly it seems, lol).
I read a clip in the NY Post yesterday where Mayor Bloomberg stated that "we" can't just blame the banks for the current crisis. The Mayor believes borrowers were also responsible with their "I want it now" attitudes.
This "we're all at fault" nonsense is BS. It's nothing but a bogus justification for bailouts and money printing. Of course people want free money. Who wouldn't?
The "now" problem stems from bankers wanting their bonuses "now". From politicians wanting a "strong" economy "now" even if it is founded on mud.
Bankers (and regulators) had a job to perform. A banker's primary responsibility is to vet potential borrowers and ensure that loans can be repaid. That fundamental function was cast aside for personal enrichment. I have no doubt about this. Ive seen it week after week for over a decade.
Lets follow the the money (THE ULTIMATE MOTIVE). The only group to benefit from this credit bubble mess is a small handfull of financiers. Borrowers were saddled with burdensome debt, savers were penalized by inflation, taxes and negative real interest rates and investors were left holding the bag when the ponzi scheme ended. Wall streeter and bank hucksters became rich for life.
Investment banks have no capitial because of the massive bonuses they extracted in exchange for ponzi assets. An age old bait & switch swindle.
For decades now, the goal of finance (and their enablers the politicians) has been to extract as much interest as possible from the economy. How else could taxes for the rich fall while government deficits increase?
At this point, I think joe six pack has reached his debt limit. That said, I have no idea what our government's debt limit can or will be. Definitely higher though.
None of the above would bother me very much if we allowed a safe store of wealth. It's tragic that the best way to protect yourself is to become part of the problem.
...a "strong" economy "now" even if it is founded on mud.
Swampland in Florida http://en.wikipedia.org/wiki/Swampland_in_Florida
In the 1960's and 1970's, scammers used nationwide advertising to lure victims to buy Florida real estate without visiting the properties first. The new owners came to find their land was under water in a swamp or in some other way impossible to build upon.
There's that 1970s again.
Buy Investment Property Without Seeing It http://www.buzzle.com/editorials/2-17-2006-89201.asp
Why would you buy investment property before you saw it? Because it isn't always what you see that matters most.
Published: 2/18/2006
These days it isn't just the property that's underwater.
Posts
5 comments:
Stag,
Just how does Cramer still have an audience? It's mind boggling. I'm surprised he doesn't need disguises or body guards.
The entire Cramer phenomenon would be comical except for the financial damage he is causing to so many innocent investors (aka fools). Buffett never should have validated CNBC with all those appearances.
I suspect we'll be reading about some seriously underfunded pensions over the next few quarters - public & private.
That commodities rally today really has the fed & treasury boxed in.
You don't get what you want, you get what you earn.
Speaking of CNBC & Cramer, check out these "pumps" & "heels":
http://www.coach.com/content/thumbnail.aspx?category_id=901&cm_sp=TopNav-_-Footwear-_-Pumps/Heels
Now that's value.
Seriously. If you ever start feeling bullish just peruse the Coach website and contemplate the debt/credit backed by all those valuable handBAG(holders).
That kind of vanity can only exist during a wild credit boom.
MAB,
Coach has been pre-disastered. Some might argue it is safe to buy now (not me!).
September 9, 2008
Is a "Pre-Disastered" Portfolio Safe?
http://www.fool.com/investing/value/2008/09/09/the-stock-market-isnt-fair.aspx
This kind of thinking is akin to how value investors view the stock universe. They tend to seek out stocks that have been slammed for some reason, and that can be expected to turn themselves around, appreciating in value. They hope all the bad events have already happened, and that perhaps good things lie ahead.
For what it is worth, Coach closed that day at $29.59. It is now $27.60.
If you are looking for a serious pre-disastered pick though, there's always Jones Soda. It's been pre-disastered down to $1.29. It's a "case" study of "halves" vs. "halve" nots. It's been "halved" a lot.
http://illusionofprosperity.blogspot.com/2008/03/my-first-sarcasm-report-revisited.html
Speaking of bagholders, check this tidbit out from my time on the Capital One Financial message board.
http://messages.finance.yahoo.com/Business_%26_Finance/Investments/Stocks_%28A_to_Z%29/Stocks_C/threadview?bn=4110&tid=33400&mid=33402
I found it amusing that one of the biggest bagholders in the known universe was gloating to other bagholders that they were bagholders. I'm an equal opportunity heckler, and that just didn't seem right.
The next day I was back to warning the longs though.
http://messages.finance.yahoo.com/Business_%26_Finance/Investments/Stocks_%28A_to_Z%29/Stocks_C/threadview?bn=4110&tid=33435&mid=33457
A lot of investors were burned by the dotcom bubble. They learned to look at the P/E. They think they understand it fully now. Only one problem. Most investors have never seen a consumer recession. We haven't had one since 1990. They don't seem to understand that it isn't just the "P" that can change. The "E" can change very quickly too.
I think it is safe to say that those investing in banks (with their relatively low P/Es even back then) have been learning that the hard way.
Further, there seems to be a serious "hysteria" containment problem these days.
By the way, you might want to read the bull's reply as well.
http://messages.finance.yahoo.com/Stocks_%28A_to_Z%29/Stocks_C/threadview?m=tm&bn=4110&tid=33435&mid=33458&tof=-1&rt=1&frt=2&off=1
I have no idea where this hysteria ends up. I guess nobody does, but I will give you one name. Thornburg Mortgage. Actually, it used to be touted by Cramer.
Its assets are pristine.
Here's a glimpse of the pristine (as of yesterday).
Thornburg Mortgage Back on the Ropes
http://www.housingwire.com/2008/09/16/thornburg-mortgage-back-on-the-ropes/
What’s amazing here is that Thornburg isn’t failing because of rising credit costs per se, or because of a foray into subprime lending; it’s failing because (like many firms) it was leveraged and maintained an investment portfolio of mortgage securities that have quickly headed south as the mortgage market has fallen apart.
Isn't hindsight fun? The pristine now trades at 30 cents. Nice tout Cramer! I knew I'd be able to squeeze another dig out of this if I just kept rambling. All dots connected eventually end there (spectacularly it seems, lol).
Stag,
Warning! This is a rant.
I read a clip in the NY Post yesterday where Mayor Bloomberg stated that "we" can't just blame the banks for the current crisis. The Mayor believes borrowers were also responsible with their "I want it now" attitudes.
This "we're all at fault" nonsense is BS. It's nothing but a bogus justification for bailouts and money printing. Of course people want free money. Who wouldn't?
The "now" problem stems from bankers wanting their bonuses "now". From politicians wanting a "strong" economy "now" even if it is founded on mud.
Bankers (and regulators) had a job to perform. A banker's primary responsibility is to vet potential borrowers and ensure that loans can be repaid. That fundamental function was cast aside for personal enrichment. I have no doubt about this. Ive seen it week after week for over a decade.
Lets follow the the money (THE ULTIMATE MOTIVE). The only group to benefit from this credit bubble mess is a small handfull of financiers. Borrowers were saddled with burdensome debt, savers were penalized by inflation, taxes and negative real interest rates and investors were left holding the bag when the ponzi scheme ended. Wall streeter and bank hucksters became rich for life.
Investment banks have no capitial because of the massive bonuses they extracted in exchange for ponzi assets. An age old bait & switch swindle.
For decades now, the goal of finance (and their enablers the politicians) has been to extract as much interest as possible from the economy. How else could taxes for the rich fall while government deficits increase?
At this point, I think joe six pack has reached his debt limit. That said, I have no idea what our government's debt limit can or will be. Definitely higher though.
None of the above would bother me very much if we allowed a safe store of wealth. It's tragic that the best way to protect yourself is to become part of the problem.
MAB,
...a "strong" economy "now" even if it is founded on mud.
Swampland in Florida
http://en.wikipedia.org/wiki/Swampland_in_Florida
In the 1960's and 1970's, scammers used nationwide advertising to lure victims to buy Florida real estate without visiting the properties first. The new owners came to find their land was under water in a swamp or in some other way impossible to build upon.
There's that 1970s again.
Buy Investment Property Without Seeing It
http://www.buzzle.com/editorials/2-17-2006-89201.asp
Why would you buy investment property before you saw it? Because it isn't always what you see that matters most.
Published: 2/18/2006
These days it isn't just the property that's underwater.
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