The Rich Man's Panic continues. Sigh ...
HPQ beats earnings and revenue estimates and guides both up. No recession there. Sigh ...
Fed minutes come out today, plus the increased forecast disclosure. Those might be really interesting.
CFC got hammered again. I suppose that more rumors abound about liquidity and downgrades. I'm thinking about re-buying it. I didn't notice until too late yesterday that it was so low. If I can get a good entry, I'll buy some for a TRADE. I figure that someone will definitely buy them - the question is at what price. I think 18 is the logical minimum, viz. the BAC owned preferred stock strike price for conversion. This will not be a huge position.
I now have fullfilled the "Plan" for my big fin long term purchase program. The positions are BAC, C, WB and JPM in order of position size. The first three [BAC, C, WB] are rather close, though. I don't want to become a "Stakhanovite" here for these. If I decide to become one, I'll be doing it thru options and for a trade.
Otherwise, nothing has changed. Beefers with winning positions are still shedding them in panic to hold onto gains to keep their fees for the year. Find good stocks & groups on buy dips for long term positions. There are quite a few good opportunities out there. Use patient time diversification. This correction will clear soon as time and price are both playing out.
PS: yesterday's S&P drop broke the recent low, hence erasing the potential rally. So we're back to waiting for a new "Day 1"
PPS: This big cap fins position is now my largest group in my Alpha Fund, even larger than the energy stocks. Big cap fins are 33% of the Alpha Fund. Energy stocks including deep water drillers are about 30%.
P^3S: Just so all know I can admit when things go wrong, my Alpha Fund is now up only 43% year to date, vs. 68% at my year high. So that's quite a drop. The sales & partial sales I made for money management around September certainly helped keep my numbers up as all those stocks are under the selling prices. All my early buys in the big cap fins are well under water. :-(( I don't mind the first buys, but the adds in Sept. to Mid Oct. still burn me, as those violated my buying plan.
About Me
- Bunkerman
- I have a pioneer mentality. My wife & I live in the woods - neighbors aren't visible except slightly in winter. Our "bunker" - hehe, really a fine home & barn - has plenty of security. We have four dogs: Krypto (age 9, Kelpie), Ava (age 13, Rat Terrier), Sky (Kelpie, age 5) and Lucky Star (age 1, kelpie). I don't take crap from anyone anymore, having enough resources & gear stocked up to survive in any circumstance. I have three degrees from Harvard including a Ph. D. in a physical science, and an MS in Management from MIT. I worked as an investment banker for about 25 years, mainly in secured finance, at three major Wall Street firms and for the last 17 years with my partners at our own firm. I'm semi-retired now, managing some private corporations and business interests and doing my own trading & investing. This is not to boast, but to give you an idea I know a little about some subjects from experience. The photo is my 1943 M16 half-track which I am restoring. These armored vehicles were ubiquitous in the US Army in World War II and Korea. It's driveable.
17 comments:
Haaappy Birthday to youuuu
Haaappy Birthday to youuuu
Haaappy Birthday Mrs Frosty
(In very high harmony)
Happy....Birtday........to yoouuu
Spin-em...she says thanks Tom...ah to be 29 again.
Bunkerman, 43% excellent job.
bot some CFC for a TRADE.
Bman I think Ben is still too tight...thoughts?
yeah, I think all this inflation jabbering they've done is sending a "too tight" and "complacency" message.
With core PCE at 1.8%, overnight fed funds over 4% is too tight.
They won the inflation war but haven't stopped shooting.
But so far, it's still a "Rich Man's Panic" in reality.
The issue is risk that good economic momentum will stop.
Some debt Beefers do own a lot of horrible low rated CDO & subprime class debt and are probably really hurting and gasping, if not in liquidation mode for the year end.
I still think the economy is OK, though. 4.5% isn't enough to kill it on its own. 4.5% is at the higher end of the range of reasonable fed funds rates.
The elephants stomping might hurt some real people, though.
Bunkerman...you need a good fed rant...50 bps now...screw the dollar.
Let no common man be crucified on a cross of dollars !!!
Reminiscing the famous speech of the "Great Commoner", William Jennings Bryan, whose only vice was in inordinate fondness for a third plateful of food :-))
atta boy...fed cut done deal, bears have been warned.
Thinking about mfl's Q ......
There is a range of Fed interest rate levels due to error and inaccuracy in knowledge. So accepting the core PCE inflation level of 1.8% [which corresponds to the recently released Fed "central tendency], what range of real returns should be put onto that for overnight money ?
I remember learning in B-school that a 0% real return for T-bills was empirically discovered of long periods of time. Adding 1% for a bank risk makes sense. And I know that current Treasury inflation indexed notes give around 2-2.25% for multi-year money. And I know that old gold notes have long term rates of around 2-3%.
So suppose a reasonable range is 1-3%, midpoint 2%. Let's take the range and divide by two to get a core centroid: (3% - 1%)/2 = 1% core centroid which is + or - 0.5% on the midpoint, viz. 2% real rate plus or minus 0.5%.
So higher math gives a "neutral range" of between (1.8% + 2% - .5%) and (1.8% + 2% + 0.5%), viz. from 3.3% to 4.3%, midpoint 3.8%
So the Fed should cut rates ... at least 25 bps just to get to neutral. And to go to the lower range to be safe in a time of stress, they should cut... 125 bps !!!
Maybe I'll post this tomorrow as a main blog, plus my overngiht thinking.
Cut 50 bps NOW and signal continued cuts !!!!!!!!!
Let no common man be crucified on a cross of dollars !!!!!!!!
maybe need that GOLD MIST ot really lock it in. No notice yet :-((
Sheesh this is getting ludicrous - they can't even do the Dow Theory right. We just had an all time high. The Industrials need to bounce seriously up intermediate term, then go down and break whatever lows we set to confirm the Transports.
Bunkerman...stomp stomp stomp...I need water :)
one would think these elephants would move on soon. This is making "kicking a dead horse" sound repetitive.
Deja vu all over again ... and again ... and again.
The same old fears for months.
Sheesh. As if nothing is anticipated ever again.
Nothing new has come out since Auguat.
So today is a new "Day 1" based on the reversal and green opening in the S&P.
Haaappy Birthday to youuuu
Haaappy Birthday to youuuu
Haaappy Birthday to Maaaa---vvvvv
In very high harmony)
Happy....Birtday........to yoouuu
golly two birthdays on Nov 21 !
Happy Birthday !
Post a Comment