Thursday, May 31, 2007
I mentioned spin-offs before, here the street is giving you a great entry. The big holders don't want these little stubbies on their books, so they dump'em. As long as you give yourself some room (remember time and price), then they can work fantastically well.
Wednesday, May 30, 2007
Woke up this morning, and the idiots on TV blaring the "Shanghi Swoon" alert. If a market goes up 30%, then down 10%, then up 40% in 6 months, do you really think it can't be down 6% in a day? The fact that it is the largest Socialist country on earth doesn't surprise you that they can get more tax dollars by raising fees on stock transactions? Doesn't anyone remember 1999? Beuller?
While I am on a rant, last night I read an article in one of these wealth advisors magazines. The supposed "financial writer" who contributed to this article on OTC derivs really blew my mind with his ignorance. He compared a bond fund that sells the CDS on its holdings is equivalent to covered call writing in equities. When in real life, we all know that the fund manager is simply doubling his bets. It is actually the equivalent of selling puts, not calls on his bonds. But that really doesn't matter, does it?
One item flying low on the radar is the amount of spin-off activity. While not as sexy as private equity cash deals, spin-offs allow you to trade like an arbitrageur with a hell of a lot less risk.
Monday, May 28, 2007
Thursday, May 24, 2007
Cousin Keith over at Turbulence of Dreaming would like me to translate some of the terms I use. Let's look at the previous post:
Yes, Gordon Gecko, Boesky, and Dennis Levine are all back. made a lot of cash insider trading in the '80s both fake and real Private equity investors, not junk bonds, are the new rocket fuel for the merger game. idea here is that Wall Street needs to do deals in order to survive Adam Warner (AMEX Alum) over on the Daily Options Report brings up some really good facts. Blue Horshoe loves everything. another former market maker from the American Stock Exchange who blogs it real good, reference to the movie Wall Street Market opens up to new highs and sells off on Greenspan. Yep, that's correct, my great uncle Al said that China was a "bubble"and the spoos decided to hit the mattresses. My grandfather's name was Greenspan, the stock market closed on its lows after trading to a new high, reference to The Godfather WRONG. Its Moors not Moops. Seinfeld episode where George plays Trivia Pursuit with Bubble Boy This market has been toppy for 2 weeks already. NDX way underperforming, 30-yr rates backing over 5%, dollar, gold and oil all reversing trend. Liquidity drying up so assets need to be sold.random thoughts on what my gut tells me is going on in the markets after being involved for nearly 2 decades. I would wait till the price hits 1450, by then all the suckers will be out. Mr. Valentine sets the price. where the SPX index chart shows some support, and a Trading Places reference Happy Shavuos to all, and to all a good night. what Charles Dickens might have said to his Jewish neighbors on the day we celebrate when the Law was received at Sinai.
I hope this helps Cuz! using old school exclamation point because I can't remember how to do those smiley faces!!!
Wednesday, May 23, 2007
Market opens up to new highs and sells off on Greenspan. Yep, that's correct, my great uncle Al said that China was a "bubble"and the spoos decided to hit the mattresses. WRONG. Its Moors not Moops. This market has been toppy for 2 weeks already. NDX way underperforming, 30-yr rates backing over 5%, dollar, gold and oil all reversing trend. Liquidity drying up so assets need to be sold.
I would wait till the price hits 1450, by then all the suckers will be out. Mr. Valentine sets the price.
Happy Shavuos to all, and to all a good night.
Tuesday, May 22, 2007
Thursday, May 17, 2007
Very scary to be leveraged up on the long side here. Gold/oil has started to diverge which should create a squeeze in dollar/yen as it has the last 2 years. 10yr also backing up to 4.75 which should send in the asset allocators soon. But I forgot, TTID.
Wednesday, May 16, 2007
1. None of these stocks are going to be takeover candidates, just investments.
2. When you have $1billion to invest, you really can't park it in any old tech stock.
3. As investors, these guys are good. As traders, you could do a lot better. One of Buffets top holdings, Coke, has done nothing until this year. You would have done better in cash and waited for the breakout.
4. Markets will be liquid until they are not. Just last week C traded 15mm in blocks at the 53 level. Where were those buyers in March at the 49 level? Running screaming "sub-prime" disaster. Hey in 2000 we had the biggest M&A activity of all time, did not keep the investors happy forever.
All I am saying is be careful. Diversify and do not chase. There are times to load up, but I don't see this as one of them.
Missed the Country Music Awards last night, did Kenny Rogers win anything? Go Utah, would love Jazz-Cavs Final, all three people would be watching this on TNT. Whats with the World Series going later in the year? November in Boston, that is really the place for the Fall Classic.
Too all you local Austin Independent Businesses from the meeting yesterday, thanks for the drink tickets, 12 year old Glenlivet really hit the spot on a Tuesday evening.
Monday, May 14, 2007
Thursday, May 10, 2007
Finally, the dip buyers get stopped out. Chart support for spoos in the 1450-1460 range. Still watching 120 dollar/yen as to global liquidity. OIH trades lower even though spot crude up. Will be interesting to see how Asia trades over the next week, leading or lagging?
Wednesday, May 9, 2007
Can you spell c-o-n-u-n-d-r-u-m. I thought you could. Now repeat 3 times, I will not fight the yield curve. Gee, a lot thats done, I guess, TTID. (this time its different).
Caught a "private equity" fund manager on boob tube today. Guy sold his internet biz to EBAY in 2000 so it makes him a market guru today. Says this rally is saudi fund managers putting petro dollars to work. Could be, but I thought they were buying the T-Note? Theory is the same, world consumption of oil brings riches to Saudi Princes, who buy our securities, which keeps down interest rates, which increases consumption. And so on and so on. So I guess until oil hits $35 again, we are in a bull market. Interesting fact he brought up that they do not buy oil stocks. Hmmm, OIH underperformed today, maybe.
If you want to see how far the FED can go, check out Volcker's crew in the '70s. Fun stuff.
Market opens lower, dip bought, shorts afraid of FED. Two scenarios. First, FED unchanged, market sells off on "profit taking" and "wording of statement". Second, FED CUTS, market euphoria creates blowoff top. Balance, focus, power Danielson.
Monday, May 7, 2007
GOOG testing 465. Market telling us they like MSFT/YHOO.
Leaders in materials and consumer stocks like AA, ATI, XOM and KO.
Transports down with lower energy prices.
VIX moving up with new highs in SPX.
Still watching 120 dollar/yen level for global liquidity.
Nasdaq definitely the laggard, flight to quality of big caps.
These divergences create fuel for the bears, but no trigger yet. Need to see what happens on the next dip. Will the FED create selling event?
Too bad about that Investment Banker at CS. Only made $7.5mm on insider trades. That's why he got fired, should have been up $20mm at least.
Friday, May 4, 2007
Not really an NBA fan, but the Spurs look like champs. Held AI and Melo's Nuggets to 80 the other night. Parker and Ginobli look like they are playing a different game than the rest of the guards in the league. It remimds me a lot like Showtime in the 80's.
Starting to feel the heat, high of 90 today in Austin. Its like a sauna in here.
Wednesday, May 2, 2007
Watch dollar/yen at the 120 level. A major battle is brewing here and will give direction as to global liquidity and risk tolerance.