patrick.net

cloud13,

helluva pick and run with BAC. Hats off to you for having the balls to stick your money in there and make some money. Did you take some profits or are you waiting for it to go back to $15+ per/share?

Thanks E-MAN for giving tips about NLY and AGNC ( I'll research about them tonight )
I'm waiting for BAC to cross $10 atleast...... BAC and C have seen so many bad news that nothing effects them anymore.

we bought BAC yesterday and PFE. Transaction costs were well worth it, it's rare to buy and be positive the next day. Day trading is a wild ride at times.

It's never a "gamble" to buy Apple these days, they grew PROFIT 124% last year. There's no risk until 5 billion people have an Apple product.

clambo says

It's never a "gamble" to buy Apple these days, they grew PROFIT 124% last year. There's no risk until 5 billion people have an Apple product.

If 5 billion people could afford apple products, nobody would be worried about the economy.

The biggest risk with apple is that Steve jobs isn't immortal.

cloud13 says

I'm waiting for BAC to cross $10 atleast...... BAC and C have seen so many bad news that nothing effects them anymore.

Yea. Sure.

I just don't buy BAC or C or any other big bank. To my mind they were prime players in this whole housing bubble nonsense. No doubt my insignificant cash on this point means nothing, but it's an ethical issue.

Plus as Whitney says they are zombie banks. So playing them right now seems to me like people playing GM during the bankruptcy, just financial casino games nothing to do with the long-term.

Vicente says

I just don't buy BAC or C or any other big bank. To my mind they were prime players in this whole housing bubble nonsense. No doubt my insignificant cash on this point means nothing, but it's an ethical issue.

Plus as Whitney says they are zombie banks. So playing them right now seems to me like people playing GM during the bankruptcy, just financial casino games nothing to do with the long-term.

I pretty much stick to day trading on those too.

I'm with e-man on this, BAC and C are dangerous. Go for WFC if you're going to buy a bank right now.

I hate WFC as a bank, and I've found every company I hate, Warren Buffet owns. They have fee's and manipulate their products to maximize their profits. I walk about of a WFC bank feeling like I've been had every time. They're smart weasels.

Every time I walk out of BAC, I feel like I've been cheated, but had to give up because it just wasn't worth my time trying to fix the problems they've created. They're just complete incompetents, trying to mimic WFC but fail.

Kevin, whether or not people can afford something never stopped them from trying to buy it. I lived in Mexico, and I was astounded by stuff sold in a store Elektra. They allowed people to buy stuff like TVs on credit. They sent guys around on motorcycles to collect the $10-15 per week the various people owed the store. I see this happening in many poor countries. My friend told me about how some people in China would save up for several months to buy an Apple product.
Looks like Bank of America still sucks, but hope springs eternal for some people I guess.
Profitable companies that are selling crap that people must buy or crave badly will still be OK in my opinion.

pkennedy says

I hate WFC as a bank, and I've found every company I hate, Warren Buffet owns. They have fee's and manipulate their products to maximize their profits. I walk about of a WFC bank feeling like I've been had every time. They're smart weasels.

The other interesting thing about Wells Fargo is how they picked up Wachovia. Shitty gave Wachovia a shitty offer that was partly backed by the FDIC -- Shitty was to buy Wachovia (including the Golden West assets) for something slightly north of $2B, excluding AG Edwards and Evergreen, and the FDIC would have picked up any losses above $42B on a $312B portfolio in exchange for $12B in preferred stock and warrants in Shitty.

Wells Fargo went balls out and picked up all of Wachovia for a whopping $15B without FDIC assistance. It was a shrewd move when no one else really had the cash, and appears to have paid off. They've been settling lawsuits for what seem like token amounts and the write-downs seem to have slowed. Part of it is that even if a lot of the Golden West portfolio performs badly, that bad performance will be spread out over the next several years.

Pkennedy, Loved your description of Wells. They are actually my bank as well -- they haven't done anything to piss me off lately so I've stuck with them. Heck, they even sent me an ATM only card this past month when my old one expired (instead of foisting a check card on me). But you're right, they are weasels. I bought some Berkshire B shares today for some more Wells exposure and went in on JPM as well. I've had cash on the sidelines for a while and ended up buying indexes on Friday and Monday. Also bought some dividend stocks -- GE and MRK without doing much research. Getting old and tired I guess.

And some more PBR yesterday. SFace, how you feeling about this one these days.

Keep an eye out for companies shares which are trading at or near book value and some near cash. LVS traded $2 at near cash. This was an extreme example back in early 2009.

Hmmm..well here's some

1) PG - they've paid a dividend I think for the past 130 years..they aren't flashy but everyone consumes. Right now it's the cheapest its been in two years...colgate might seem good but it's still a bit high..if it gets to 65 then maybe

2) I'd avoid social media but I'd say if google reaches 450-500 that might be good

3) retail can be iffy...tractor supply has been a solid 45 degree angle for the past few years but the PE still looks good..maybe 45-50 for a price range. HH Gregg might be a good one too but you'd be playing with fire. They bounced back years ago and some made a killing but that might not happen again. It might sound bad but discounters aren't doing that bad..bottom end ones. Dollar Tree is not even down 10%..it's had a significant run up, dollar general seems stable but that doesn't mean it is moving up either, family dollar if you get 30-35 then I don't think it will get lower
vf corp looks good. If people are trading down for clothing it hasn't phazed them...they also rent uniforms under their red cap division.

Their EPS looks really low though. SF Ace, whats your strategy and position on these types of companies? Low EPS, low Marketshare, pretty good divident....

ill scoop up some stocks if the price is right on an individual basis, i will buy stocks that have the potential to grab market share,, an example AMD, growth is dead, market share is king, and options are the single best tool to use, but you have to be very very careful when you pull the trigger, never ever ever buy something just because you have the money, wait as long as you need too 1 year 5 years, 10 years, buying something at the right time will make you money, always being invested will get you squat, patience is king, you need to be like a sniper behind VC lines living off snakes for subsistence watching your target through a scope, finger resting on the trigger, waiting for weeks at a time for the perfect shot

picture related its my investment strategy

WHEEE!

It's like a rollercoaster ride.

Took AAPL profits off the table, I am back in all cash, I lack conviction about this rally.

Buy stocks of can food or you'll be cannibalizing your neighbors!

Sorry, I've been reading too many of Apock's posts.

There are a lot of traders who make money from the ups and downs, that is what is going on lately. It's almost irresitible.
But, many countries are growing quickly, and these are going to be consumers of: 1. gadgets (Apple 2. health care (Novartis, Pfizer, Merck) 3. entertainment (Discovery, Disney, Universal) 4. Energy (Exxon) 5. food (Potash, Monsanto, Deere) 6. government construction (Caterpillar). 7. communication (Telmex, Chinamobile, Verizon). 8. shampoo, toothpaste, butt wipe (Kimberly Clark, Procter and Gamble). 9. luxury goods/fashion (LVMH, Ralph Lauren) Some large companies are paying nice dividends today.
If you think this is all going to stop because USA has slow growth, I would not bet on it. I lived in a third world country for a few years and there was a tremendous pent up desire for junk and comfort and they are trying their hardest to have everything we have here. They'll kill themselves trying to get it, and to please some woman and her kids in the process.
Of course, governments are still inept enough to ruin this too, there is always that possibility.
My friend yells at me to get out of my mutual funds but I am investing for the year 2025 or so.

SF ace gave a super example, RIG.

"If you think this is all going to stop because USA has slow growth, I would not bet on it. I lived in a third world country for a few years and there was a tremendous pent up desire for junk and comfort and they are trying their hardest to have everything we have here. "

The head of Caterpillar stated that he wants to double sales to Africa. The reason being is not so much due to demand but actually because these are big machines that you don't wear out in a few years. If they don't sell it then Cummings will..if they don't then they think a Chinese company will.

It is easy to switch brands on a car that costs 15-20k but if you are used to something that costs 200k switching is not as easy.

Reminds me that it isn't always the most expensive stuff but the simple stuff that might go up as well. Tupperware isn't exciting but as people buy food eventually they have to store it safely. They've done really well. Heck even makeup can sell. Estee Lauder is nearly at a all time high.

Can't use the box store mentality, it has to be small. But there are some exceptions. Furniture city alone is crazy
http://en.wikipedia.org/wiki/Shunde,_China_Furniture_Wholesale_Market

Wall Street is legalized gambling, like betting at the horse track on which horse will cross the finish line first. Again, the race track, like the casino, has better and fairer rules to try to prevent the fraud than Wall Street.

PasadenaNative says

Wall Street is legalized gambling, like betting at the horse track on which horse will cross the finish line first. Again, the race track, like the casino, has better and fairer rules to try to prevent the fraud than Wall Street.

wherever there is money there is always fraud. Its human nature to screw their own kind.

Wall Street is legalized gambling, like betting at the horse track on which horse will cross the finish line first. Again, the race track, like the casino, has better and fairer rules to try to prevent the fraud than Wall Street.

thats what loosers say, as an investor i consider it my first and foremost job to identify fraud, thats part of the role of an investor aka investigator to weed out the scams from the legit deals, if you dont know how to identify fraud you have no business at all investing, sadly most individual investors don't have a clue

BAC is too risky at this moment I would say. It would go down further as it seems now.

BAC and many of the other banks are only alive because of a fictional accounting and a captured political class. Buying them is simply gambling. I'd rather play roulette since I know the odd and payouts ahead of time.

If its money you can "afford" to lose then not the end of the world I suppose. But otherwise its best to stay away from stocks. If we truely down into a depression your not likely to win at all.

SFAce: I bought a boatload of RIG instead. 4B or 20% below book value and a company generating 1B in operating cash flow less Capex.
Still learning here as I nose around the balance sheets and cash flow statements. Bear in mind the 20% below book value (now down to 10% given the recent rise) includes intangibles (the largest being $8 billion of goodwill -- not written down at all since Macondo). Still having a hard time pulling out the cash flow above. The last quarter was not pretty as rental rates per day are down in many categories (due to competition). Also, utilization is down with a lower backlog. If business picks up, they should be able to capitalize on the opportunities. I guess that's the bet here... (also helps to buy out the competition as they appear to be doing today). Historically they've done well. Anything to add?

surfingerman says

thats what loosers say, as an investor i consider it my first and foremost job to identify fraud, thats part of the role of an investor aka investigator to weed out the scams from the legit deals, if you dont know how to identify fraud you have no business at all investing, sadly most individual investors don't have a clue

You can't catch and identify it all as a small investor. Fraud doesn't walk around with a sign, millions are usually spent covering it up. And you don't have millions to uncover it.

surfingerman says

thats what loosers say, as an investor i consider it my first and foremost job to identify fraud, thats part of the role of an investor aka investigator to weed out the scams from the legit deals, if you dont know how to identify fraud you have no business at all investing, sadly most individual investors don't have a clue

Perhaps you are playing big money and can afford to do forensic accounting. What businesses have you identified fraud in? Enron? WorldCom? Lehman? Bank of America?

surfingerman says

thats what loosers say, as an investor i consider it my first and foremost job to identify fraud, thats part of the role of an investor aka investigator to weed out the scams from the legit deals,

Most people don't have the time or aptitude to dig deep into financial statements. However, one should always read a few opinions from people who are Shorting the company prior to investing.

The shorts do more to bust Fraud than the SEC.

E-man says

EBguy, I hope you took profit on PBR.

I bought some PBR the other day. 66 cents/can, a bargain at twice the price. Then I drank it and day-traded some stock and made $1000. PBR is awesome.

stock in yourself, or a family member. Tuition, healthcare, job training, gym membership (make sure to use it!).

LINE and SBUX both look interesting to me today. Thanks for pointing those out E-man.

MPEL - Best Casino investment in Macau, most undervalued.

Another drop today. Keeping powder dry for reload soon though.

What about PSQ? Or any similar inverse ETFs? If we all believe the market is falling, why not try to take advantage of it?

I'm leery of inverse ETF for slow grinds down like this.
YMMV.

I put some retirement cash in the mREIT ponzis -- here's a good leverage chart. I can't help but feel this will end badly, but for now, there's cheap money.
I think some of you folks come from this school of investing. Name that investor:
“I’ve taken a whole different approach than most people in investing. I think buy and hold is a crock of *%&# (bleeped). I’ve always been of the attitude that unless you really have a commitment to something, just keep your money in cash … knowing that at some point in time, there’s going to be a week or two like we’ve just had.”

BeMeProtest says

What about PSQ? Or any similar inverse ETFs? If we all believe the market is falling, why not try to take advantage of it?

That works if you understand how inverse ETFs work. Most people do not. I have written about this in two prior discussions:

http://patrick.net/?p=617532#comment-757241
http://patrick.net/?p=880544#comment-750625

Inverse ETFs are absolutely not the same as a short and do not simulate a short except on a daily basis. They do not simulate a short over the long term, and high volatility, such as we are seeing now only makes them simulate a short more poorly. Unless you are day-trading, inverse ETFs or 2X or 3X ETFs may not make sense for you.

Wondering if you pulled the ripcord and bailed out of BAC and C?

Or are you averaging into them as they go down?