SubscribeSunday Fun: Where is Dick Cheney?
November 2, 2008
Is it me or has our Vice President been conspicuously absent from anything related to this election? Now that I think about it, what has he been doing lately?
WAIT! I think we may have found him. There are 4 Dicks in the image below….can you find them?
If you are interested, here are links to current news items related to our hard working VP:
Bruce Springsteen’s Economic Wisdom
October 29, 2008
As I was thinking about all that is going on, I cobbled together a summary of the market madness inspired by a list of Bruce Springsteen’s songs. I am even thinking of writing him in as my choice for President since I am having a very difficult time deciding who to vote for.
I hope The Boss would approve….
(Song titles in bold/caps)
I am certain that there are BETTER DAYS ahead as the markets are generally BORN TO RUN. My advice is simply: DON’T LOOK BACK and realize that there is no MAGIC formula in the world of investing. Right now, there is panic OUT IN THE STREET and in the REAL WORLD these days every REAL MAN is having troubles and RESTLESS NIGHTS because PARADISE seems LOST IN THE FLOOD of the market turmoil.
This has been a LONG TIME COMIN’ and the worry about keeping a MAN’S JOB on top of this mess makes this time TOUGHER THAN THE REST. It is clearly a WAR taking place started by the financial companies stoked by greed that made many investors now understand that WE ARE OUR OWN WORST ENEMY. 
We borrowed too much and created an environment of ALL OR NOTHING. But, be sure that you, me and WE SHALL OVERCOME. Right now though, the market is being pushed and pulled by many DEVILS AND DUST particles will surely begin to settle after the election.
Remember, the markets cannot deal with uncertainty and when the MAN AT THE TOP is found and that LUCKY MAN is known, we will be ONE STEP UP towards reduced volatility.
One thing we do know is that right now, investing in the financial markets is a ROLL OF THE DICE or perhaps more like a game of ROULETTE, but there is REASON TO BELIEVE that the SEEDS planted by the FED and Treasury will eventually SPARK THE FUSE that could create a bull FEVER from these levels.
How long will it last is the real question as we all wonder WHEN THE LIGHTS WILL GO OUT on the rally. Now it is right to be a CAUTIOUS MAN into a time when short sellers are screaming COVER ME and frantically pushing stocks up in an environment of NO SURRENDER.
This is no longer a world that is run by those who are “in-the-know” who have our best interests at heart. Rather, it appears that those in charge are PART MAN AND PART MONKEY that gave us THE PROMISE of the American Dream only to issue more and more credit; better know as THE TIES THAT BIND.
THE LINE has been crossed and it appears that while we may seem TRAPPED AGAIN by bills and financial worries, those that have realized early on that it is time to take matters into their own hands will eventually LAUGH ALL THE WAY HOME. We know all too well that the credit crisis was BORN IN THE U.S.A. and has spread ACROSS THE BORDER and now beyond THE RIVER. But, in the REAL WORLD, things have a way of cycling and this too shall pass. Now we need to look OVER THE RISE to seek and plan for yours and MY BEAUTIFUL REWARDS.
Audio: Dvorak/Horowitz Unplugged #3
September 28, 2008
From John C. Dvorak’s site:
Here is the third conversation I had with stock picker Andrew Horowitz about the post WAMU/debate market and where it is headed. What to do? This chat is not produced and presented as-is for anyone who wants to listen in.
Click HERE to listen in….
That Sound? The FDIC Insurance Suck
August 10, 2008
According to Meredith Whitney of Oppenheimer, there is a huge amount of uninsured deposits at many of banks which could soon be causing a huge problem. If you think about it, it makes sense. As time goes on, more and more money will be moved from bank to bank as depositors become more concerned about the amount of money they are insured for. Essentially, money will be spreading around and:
- Fewer people qualifying for mortgages
- Banks recapitalizing and not providing credit
- Wachovia 35% uninsured
- Capital with be flowing from weak hands to strong hands
- People who need capital/credit will not get it, those that don’t, will.
- Available credit for consumers will shrink
- Some financial stocks will revisit lows
Think about the above list for a moment. What I think is the most interesting takeaway here is the fact that money will be moving out of banks at a very fast pace if we continue to see banks taken over by FDIC. This is because it will actually be detrimental for the FDIC to rescue Read more
Lynching Merrill - Suicide or Murder ?
August 4, 2008
It is really bad isn’t it? Even as we are being told that all is okay on Wall Street, the banks and brokers are so full of disease it can easily be compared to necrotizing fasciitis. You know, that awful flesh eating disease.
The latest shenanigans by Merrill Lynch (MER) is almost too much to Bear (pun intended) and now we are going to surely continue with a crisis of confidence as it seems impossible for this group to allow the truth to come out when they speak. Now Merrill is in a jam and they are trying everything to make it seem that all is just fine.
Bill Fleckstein had a few observations on this that just cannot be ignored:
So the question is: What changed in the past couple of weeks to cause a CDO — a package of loans known as a collateralized debt obligation — valued at 36 cents on the dollar to be “sold” last week at 22 cents? What did Thain know about this at the last conference call, and why was it not made clear to folks? (For more on the sale, click here.)
Of course, this is more a consignment sale than a true sale. Merrill is providing 75% financing on a non-recourse basis. That means it’s really receiving about 5 cents on the dollar. It may get the other 17 cents later, or it may get the securities back. In essence, Merrill wrote a put option “down 5 cents on the dollar” and gets a call option to get the other 17 cents.
Essentially, Merrill is putting up the funds to sell of the assets. Does that mean that the super-senior-debt they put up was sold for almost nothing? Why the payoff? What did Lone Star, Temasek or others have on them or even better, why did they unload the debt and lose the potential upside? Are they out of options?
The ugly factor is at an all time high. If Merrill goes down, it will not be because they were murdered, it will be because they kicked the chair out and hung themselves.
Jim Jubak’s feathers are in a ruffle over this and is mad as heck at the way CEO Thain has treated shareholders. The 38% dilution after this deal is appalling and shareholders should really take notice.
The games that are being played are the absolute worst thievery I have ever encountered. How do we invest in an environment in which the rules are continually changing - and we are not getting any of the updates. Something stinks on Wall Street. Perhaps it is the rotting corpses of the brokers that are still walking around like zombies, not knowing that they are already dead.
Jim Jubak on The Disciplined Investor Podcast is HERE.
Disclosure: Horowitz & Company clients do not hold positions (of this crap) as of the time of this writing.
