November Stock Discussion

Job numbers good, market off to the races again.

Would like to discuss this with those who care and have something to add to the discussion.  My father is a financial advisor with 30+ years in the business.  No point but to state some background.  He had traded for many years and has a pretty good feel for the market.  I find in the current state of the stock market, I get torn between the fact that I feel stocks are vastly overvalued on current earnings, and yet to short the market you are fighting both the Fed (with monetary easing out the ass) and the current Bull market trend.  We are currently at a 50 mda over the 200 mda, and we have continued to hit new highs, which my father states is a confirming bull signal.

He states that you have to look at the big picture and ignore the short term BS and trading trends.  He feels that the DOW will at some point hit 13,000 since that is a 50% gain from the point at which the Dow first signaled a new bull trend.  I have to admit he has been pretty accurate over the last year or two, even though I have I have been overly bearish and made fun of some of his bullish predictions.  He called 10k back in early July based on market action and I openly laughed at him as I shorted the market into my own personal hell.  Honestly at this point, I am just wondering if the Fed will let this market go down at all.  Would love to get some banter from some of the wiser posters on this site, have a decent cash position that I would like to deploy at some point, and I am wondering if I missed the boat.  All comments welcomed. 

So over due though for a pullback  Natural gas stocks really seem over priced.  Probaly will buy puts on many of the names.

stocks that I owne for the long term are [rev] up alot from when I bought it but as it's numbers get better it should reach 50-65$ a share. Look at [EK, LIZ] for growth. I agree completely with what your dad says! I also have stock that I trade between support and resistance. GOOD LUCK

  Seriously, I would stop laughing at your Dad and start listening to him. He sounds like a savvy veteran to me...

Where are we going to generate the E to justify even current levels, let alone 2007 highs?

I dont see it at all personally.

I think the Fed and assorted central banks can make the U.S. market whatever it chooses for periods of time...just as they can manipulate other assets.

 Does it make sense? Not really...I agree with ya Wall...but I do not think fundamentals have played a role in any of the past several years...

Vermeer,

2007 levels meant banks at MUCH MUCH higher levels, mortgage companies not gone under, tech companies at MUCH higher levels, housing stocks higher, commodity stocks MUCH higher.

I dont see it..and even with loose money I dont see us getting back to those E levels..

  Me neither. I foresee the following for 2010: persistently high unemployment, remaining around these levels...continued retail and commercial real estate distress...and a Fed unable and unwilling to do anything re the dollar until after the mid term elections, and if that is the case, say hello to ever higher oil prices, hardly the spark of a consumer recovery, more like the nail in the ever growing coffin of unemployed and unemployable on the government dole.State tax coffers are  currently taking an enormous hit, which will also continue and that should lead to even more layoffs. A vicious cycle...

  Somewhat like 46% of Americanos pay NO federal income tax....look for that number to rise.

  Does anyone expect fiscal restraint from the cretins in Congress? In what century?

 However, Jim Grant foresees a "pretty damn zippy" recovery, and he is not usually given over to wild flights of optimism.t.So what the hell do I know.

What we have left out of the discussion so far is the value of the dollar. For the U.S. to survive and to continue to dominate in the world economy, the value of the dollar must drop. Also, China may be the biggest gorilla the U.S. may face in its struggle to revamp the dollar. If China continues with its dominance in consumer manufactured goods and if the U.S. plans to continue doing business, obviously, the dollar demise is assured.

pagin Palladium and/or any commodities players,

QMM recent nice lil run-up,  foreseeing a rise in silver starting to think this might be one to bet on n forget about for 2-3 years.  anybody?

Silver's place in the commodity environment will be intact as long as the USD continue intact. Against the USD, the price of silver has more than tripled since 2000. Nine years later, the USD has simply devalued itself by the moves of our own government. With a trillion dollar deficit and with a trend which will continue, silver should be a good investment in the long run.

A good place to start is to simply accumulate silver on a regular basis. I do it because the USD is not worth like what it was 10 years ago. Of course, if the USD were to go back up again, it would be the perfect time to buy silver as much as possible.

Gold is rocking...

  I hate to see it despite the fact I have always owned gold and always will...the debasement of the buck just makes me gag.Helicopter Ben in full flight...there used to be a general known as Curtis "Bombs Away" LeMay... I think Bombs Away Ben may be as apt.

I think more than anything this gold and dollar move is based on momentum..probably not fully based on reality or any legitimate reasons.

It also seems that the USM up equals the USD down and gold up.

One thing for sure, they want this market up..so up it goes.

 

Just wondering how you reach a conclusion stocks are vastly overvalued ?

The PE of the S&P 500 looking forward is only 17.22, that's below average long term.

Stocks are cheaper today relative to earnings then they've been since going way, way back to the early 90's.

Everything present in bull runs over history is present now, yep, we're going up from here.

"way way back to the early 90s"....you mean the Old Normal years right? A consumer driven economy with lots of trade financed with houses as ATMs. right? I have to doubt a return to the old normal, as the old normal was in fact a series of bubbles...then again, Bombs Away Ben ma indeed create yet another bubble, he certainly is trying!

 By the way, anyone else think John Paulson is simply talking his own book with this latest foray into the gold fund biz? What do you think Wall? I am not gonna stop doing what I have been doing since way way back in the 90s, buying gold, but I do wonder at the timing of this on his part...


 
 

Bill Gross...right as usual..

Raise interest rates with 15 million jobless and 25 million part-time working Americans? All because gold is above $1,100? You must be joking or smoking – something. We will need another 12 months of 4-5% nominal GDP growth before Bernanke and company dare lift their heads out of the 0% foxhole – mini-bubbles or not. Instead, the heavy lifting or the charging of enemy lines in the case of this metaphor will likely be done by other central banks – already in Australia and Norway. In addition, and importantly, China may abandon its dollar peg within six months’ time and with it, its own easy monetary policy that has fostered more significant mini-bubbles of lending and asset appreciation on the Chinese mainland. With renewed upward appreciation of the yuan may come potentially volatile global asset price reactions to the downside – higher Treasury yields, and lower stock prices – which the Fed must surely be leery of before making any upward move, of its own, and before moving on, let me state the obvious, but often forgotten bold-face fact: The Fed is trying to reflate the U.S. economy. The process of reflation involves lowering short-term rates to such a painful level that investors are forced or enticed to term out their short-term cash into higher-risk bonds or stocks. Once your cash has recapitalized and revitalized corporate America and homeowners, well, then the Fed will start to be concerned about inflation – not until. To date that transition is incomplete, mainly because mortgage refinancing and the purchase of new homes is being thwarted by significant changes in down payment requirements. The Treasury as well, has a significant average life extension of its own debt to foist on investors before the Fed can raise short-term Fed Funds.

Interesting read and take there..and I agree this is a longer term process.

I slightly disagree with the need to hold rates THIS low for THAT long..but the process will take a few years to work its way forward, I agree with that completely.

BigBad,

You're thinking is correct.  It's my second biggest holding right now.  Here is what we know Tom Patton the CEO of QMM took Western Silver from a penny stock to a multi billion dollar buyout from Glamis.Goldcorp; he says QMM Nieves mine has twice the potential of Western Silver.  Then we have three deals signed with Freeport out west to help us drill an area pegged to have 60 billion with a B pounds of copper.  Then there is the molybdenum, palladium, uranium projects etc..  QMM has a market cap around 125 million so FCX could buy them out on the copper projects for pocket change.  Read the mosty recent report on their website it's all in there www.quaterraresources.com

An institution stepped up last Thurs and bought 1mm shares and seems to be providing support.  The ask used to have 1-5 hundred shares now it's consistantly 10k shares so someone is building a position.  Could be FCX or one if the many institutions including NY Life Patton recently presented to.  Then we have all the board no longer taking salaries but rather opting for options which when granted they must hold for 6 months all the more incentive to create share holder value.  This move is for real and I'm not selling a share even though I'm up 200% on most recent purchases; this is a Southern Copper/Agnico in the making.  I just wish all the money I commited to PAL I had put into QMM which after much debate between the two I did a couple months back and kicking myself bad right now.

Any more questions hit me up I know a geologist that advices this company and he can answer any question better than IR will.

Wall

 Sent you a pm, not sure if you will get it...lemme know if you have a response...or if I have t do something to get a response...

Know you have a lot of friends requests...if you don't wanna bother no problems.