October Stock Talk V

CC

i dont know chit about brazil other than they play soccer, girls wear thongs and leandro barbosa. why are they gonna be ahead when the dust settles ??? do tell

Wallstreet, tremendous profits can be made in FOREX right now, I made a nice killing yesterday on USD/CAD, the USD is just KILLING every currency on the board right now. 

iceman,

I made a comment to you a while ago about the Forex and that my view is that the USD goes HIGHER against the Euro longer term, back to par or better.

The FED is slowing the print machine plus the US is ahead of the world as to the recession, so the rest of the world will start to crack just as the US has and we will rebound and start to improve BEFORE Europe etc do, so the value would be to go LONG the USD if I were making a trade..and not for a few pips, but for a longer term hold..like a year or longer.  

 CC

 I think you might want to read Argentinian economic history. The saying "Argentina will be a future power, and always will be" is not a truism for nothing.They have wonderful resources and an absolutely abysmal economic history.

  Wall: The USD is being propped up on the theory that the rest of the world is behind us in pain and hence the consequences are lagging.That much I get. But the fact is the US presses are own overload, the cheap dollar has been the chief (and almost only) saving grace for our trade, allowing our companies to profit from exports.That game is over.

  So while I understand your point, given the enormity of the debts incurred already and there are plenty more to come (Freddie and Fannie are hardly out of the woods:in fact, they are going deeper in as housing is hardly going to come back when another million people lose their jobs), I do not see how the massive printing of greenbacks results in a higher USD.

 But that is just me.

PS

 CC I think Brazil is the better bet.And yeah their economic history is spotted at best.They could still fall for a Hugo Chavez style stupidity regarding oil etc. But I think they have seen the destruction he has caused, and if oil stays low, Hugo will soon be either in exile or 6 feet under.

Vermeer,

My comment is relative to the LAST eight years. I think the printing presses will slow relative to the last 8 years AND the world economy dragging behind, both forces should bring the USD back near PAR over the long run.

I dont think the recession will smack every economy, I actually think India/China etc will keep going forward due to their revolution so to speak.

 OK got it Wall...

Wall, CC, KOAJ et al:

 What are the top three metrics (God I hate that term) you use in looking at a long term holding (not a trade)? ROE? Shareholder equity per share? P/E etc etc?

 Just curious. I have my own preferences, just wondering if they match up at all...

PS

 Just for the record, I do not think the market has come close to factoring in dismal earnings  for the next 12-16 months.

Do you agree? Or am I overly pessimistic? I think we are still looking at expensive valuations...

Here comes the late day further selloff?

C at $12.56...

I do believe CC predicted this level back in the spring.(Never did find that original debate post but recall under $13 )



 

She'll probably fall to -400 or more and then recover some.  Always seems to selloff between 2:45 and 3:45 or so.

On another note, though, this on Argentina from the WSJ...

Among emerging market investors Argentina is now considered one of the worst places on the planet to put your money. Now that commodity prices are cooling and the global economy is slowing, Mrs. Kirchner is facing a $10 billion shortfall in what is due on government debt by the end of 2009. Where else to turn but to the resources of the private sector? Argentina, if little else, serves as a cautionary tale on how to ruin an economy.

This is the same economy that experienced > 1,000% annual inflation as recently as 7 years ago, akin to an African dictatorship.  Yes, that means you Mr. Mugabe.   

Those who repeat the flawed actions of the past are doomed for future failure. 

very interesting read about the current crisis. The paper is called working paper 666 by the Minnesota Feds

basically the paper is debunking the information the public is telling us

Myths about the financial crisis:

1. Bank lending to nonfinancial corporations and individuals has declined sharply.
2. Interbank lending is essentially nonexistent.
3. Commercial paper issuance by nonfinancial corporations has declined sharply and rates have risen to unprecedented levels.
4. Banks play a large role in channeling funds from savers to borrowers.

We have not seen the bottom yet. We have not even tested 2002 - 2003 lows.

Dow 5,000 - 7,000 in December.

BTW.

SHORT    THO      !!!!!!!!

And when I say Dow 5,000 - 7,000 in December, I mean that which I said exactly.

It will fluctuate in between 5,000 and 7,000 in the month of December 2008.

Not really true.  Dow never fell below 7K in 2002-2003.  Closing low was around 7.5.  It's basically fallen to those levels and that's before inflation.  Inflation-adjusted we are way lower now than we were then.  Haven't been consistently under 8,000 since 1997.