3rd Time A Charm?

Discussion in 'Trading' started by stonedinvestor, Oct 8, 2008.

  1. Idiots reign supreme.

    Stoned is one of the most stupid and self-misguided people I have ever seen.

    Lots of people also write to Jack Hershey, and he is just as willing to convince himself that he knows what he is doing.

    That is why 95% lose their money trading...
     
    #41     Oct 14, 2008
  2. Zones your note is wrong on so many levels. First of all you have never SEEN me, if you had and I could find you again, you wouldn't of even posted. At least you acknowledge the reign supreme part.
    Lots of people Do not write to Jack Hershey.
    He has not convinced himself he knows what he is doing- no one has. 95% of people lose money because the F*ing stock market is DOWN 50% YOU MORON..... Obama had one of his few great linesd last night in reacting to the McCain plan for lower capital gains taxes.... " No body has capital gains. " In a normal uptrending market folks as simple as hell make fine money just in index funds! I think what you were trying to say is most active investors or daytraders fail and that's probably true.

    The point is I have a point. And I have been around long enough doing this that I know when to be scared and when not to. Today, friends, I'm back to scared.... The small minded can attack in times of greatest calamity, I'm sure little Zones would be typing away to Yahoo in the middle of the Pear Harbor attack, were he and computers around then... A whole lot of people NEEDED that money last week buddy, I know- I was one of them. To trivialize this thread with the same boring one liners we have been hearing for years... my god... bring something interesting to the table or take your damn bib off!

    Today I want to talk about Munis-
    I have been struggling with finding the right way to play this should the uneneding, Icelandic-like terror never abate.... and Munis strike as an interesting opportunity. Certainly researching and buying the right Mutual fund in thsi arena would be a fine place to stash a large chunk of cash now, should anyone have that. I was sent some comments from JP Morgan Private Wealth, Yes I know someone wealthy enough to get their email updates- stoney

    The most significant changes will take place in U.S. portfolios for taxable investors, where we are reducing cash and hedge funds, and gradually adding to longer-duration municipals. As for hedge funds, the reduction reflects changing terms and conditions for liquidity affecting some funds as described in the September 26 EOTM, and the possibility of marginally higher federal tax rates for high net worth individuals. As for municipals, while tax-free money market yields are not that different than 5 and 10 year municipals, we believe money market yields will decline (perhaps as banks that function as liquidity providers on municipal variable rate demand notes take on more risk).

    A further word on municipals. We are preparing a broader piece on the topic, but some of the press articles appear to be overstating the distress. Massachusetts is a good example. There was a lot of concern about their financing needs and ability to access short-term municipal credit markets last week. They then proceeded to issue nearly $1 billion of short-dated securities at 2.2%, which was 6 times oversubscribed (demand vs. supply). There have been press reports about funding shortfalls, but these are to be expected given declines in employment and housing. However, unlike the Federal government and many financial institutions that did not prepare for a rainy day, many states did. In the aftermath of the 2002 tech collapse, states recognized the importance of excess reserves to address fiscal downturns. These rainy day facilities amount to around $50 billion (b), which is around 7.5% of total state expenditures, and more than 2/3 of expected budget shortfalls. In addition, states don't run accumulated deficits like the Federal Government: 49 out of 50 states have balanced budget clauses limiting their ability to run prolonged deficits, and explicitly prohibit deficit carry-forwards (c).

    As we have covered in prior notes, general obligation and essential service revenue bonds have lived through some very tough periods (d). Despite five recessions including arguably the worst recession in post-war history (1973-75), Fed Funds rising to 19 percent, two oil shocks, wage and price controls, unemployment that hit 10 percent, a couple of episodes of 30.0 readings on the ISM report, several stock market crashes, etc., the incidence of municipal default is extremely rare. Moody’s reports a grand total of 41 defaults of their rated bonds from 1970 to 2006 out of 28,000 issuers, and report that their entire universe of rated municipal bonds experienced a lower default rate than Aaa-rated corporate bonds. Moody’s defaults were highly concentrated in not-for-profit hospitals and multifamily housing. Fitch reports only 2 defaults over a similar period, and S&P reports no rated defaults of all AAA and AA-rated bonds, with a 0.19% default rate on A-rated paper.
     
    #42     Oct 15, 2008
  3. Keep in mind I haven't bought a mutual fund since mainstay Funds & some Bob rodreguise FPA fund in the early 1980's!

    Ronald Fielding was profiled in BW and his funds seem like the way to go. He reigns over Oppenheimer Rochester family of 18 muni funds.
    He takes on risk so it qualifies for stonedinvesting.
    They have a NY Muni, so I'll be looking in there for sure. Read the article online, Fielding has a nice track record and this is probably not where the novice should be picking and choosing his own Muni's. Think about one Muni he still owns in the fund- A 1990 Muni to build a terminal at LaGuardia Int. Airport. It was backed by a lease payment stream from Eastern Airlines. Well they obviously went belly up before the project was near finished- Continental took over the terminal... Continental then lost it's lease in bankruptcy and the terminal went over to US Airways!!! And they have gone bankrupt TWICE!
    Throughout all of that failure the bonds have paid a steady 9%. Oh yes TAX FREE! The land is just that valuable.

    The fund is down 13% it's worst nine month run ever. Fielding is only 59.

    Ok onto Wed.
    People are eyeing LIBOR too much. Traders are trading on it's every tick. This brings a lot of negatives, if it backs up unexpectedly we take a huge dip and if it doesn't go down fast enough- we take a dip... two of the three scenarios have us in the soup. Yesterday the market turned south the moment LIBOR flatlined.

    Today they would have us believe that due to earnings the eye of the market had turned to the reality of recession. That would imply the credit crisis is behind us which it isn't. At any moment that could leap into the headlines and here we are with another set of realities two of the three outcomes result in negativity.

    So I'm back to being unsettled.

    GMXR is my tracking stock today. Cramer was pumping another nat gas play, I forget their name... but maybe that brings eye to the sector... half way cleaner than oil, I got to think you position yourself in nat gas now and await OPEC'S upcoming big production cut. CHK is an investment fave and they have a lot of high yield ways to play the name... for whatever reason I'm fixated on this GMXR.

    Another way to invest of course is to just go through some old notes and land upon something you did not buy because it was too far ahead and which now of course has crashed horribly... I think in that arena I would really highlight Meritage Homes. MTH. I was very close to buying but the damn thing was like $3 off it's high.... well after a one day 20 plus % downslide and more falling after that we are now no longer $26 but $16. I like management I like the people that like this stck I like the fact that they are buying up assets on the cheap now. I like the aiming for lower cost homes now attracting those with the Freddi and Fannie guaranteed loans and the tax break... They are in CA, Florida & Texas.

    Anyway mortgage rates are not coming down which is a probalem and Credit Cards are based off LIBOR and with all eyes on these inner machinations of the market, it's very dangerous out there and we could find ourselves quickly in trouble. Two of the best banks Chase & Bof A, the two I use the most have the highest risk of credit card defaults... and onto Christmas as they say... Damn talk about a coal in the sock kind of feeling. ~ stoney
     
    #43     Oct 15, 2008
  4. Alright folks. State Street being hammered among other earnings today... earnings not being treated well.

    I continue to work my potential buys into a final list & despite todays drop I now have that list. I've told the hedge fund that late today or thursday would be some buying for me so the scary thing is- there is cash to do these moves!

    Will I have the guts?

    Anyway what I do is put the stks I'm looking at through various fiilters, the mind, everday realities, the market in general, relative strength, ccash on hand, insider activity... the usual. Due to the nature of the entire market I am not using MACD or RS for timing because everything looks like crap in that regard.

    Ok HERE ARE SIX TO LOOK AT!

    1) Marshall & Ilsley... Wisconsan's biggest bank and an earnings story today. They didn't have a great report of course but it was not that bad, it showed improvement over last qtr and although their construction loans are weighing heavily against them, I like the fact that the regional shot up with the other banks recently and despite tossing in earnings which can easily kill a stk in this environment they are hanging in there today, caught an upgrade even and has a conference call twenty two minutes in right now... watch the interday chart already some buyers are poking around. Symbol is MI. Cool symbol.

    2) Trex. Most of you know I've liked this artificial wood play for a long time. It falls within a " green " building scheme and despite very troubling housing conditions this stk had been on fire at one point up over 100% on the year. Today it is $15 down from $20 and since housing led us into this mess I've got to at some point have some building or building material plays for surly they will fire out first when the end is really in sight...

    3) That brings us to meritage Homes- MTH - Meritage too is an outperformer within the space and we are always told to buy the strong one's on pullbacks and that's what we have here. They are building a nice cash hoard and better yet deploying it picking up assets on the cheap.

    4) Vertex Pharm- My favorite bio now I think, holding up super. They did have a press release today regarding a trial starting so perhaps that has brought in buyers and to some extent is holding up the stk. But I'm into my third week of following it closely, it is trading well on down days and not so great on big up days. That means it's not a cardiac kid who's reacting violently to overselling but rather it has a strong core of investors who are not freaking out and not selling with an eye on the near future. I'm 99% sure I'm buying this one in size. If I do I'll post specifics on their exciting lead compound shortly thereafter.

    5) Woodward Gov- Folks this is the cleanest stk I can find today. Flat to up with no press release or verbiage to goose it. A wind play now they used to build platforms for oil exploration when I used to own them ions ago at $10.... and they say buy and hold doesn't work! Well I've eyed it throughout the years somewhat wearily as it climbed and climbed. Today it sells for around $30 which is a hell of a lot better than $50.... I think that was the high, have to double check that. Symbol is WGOV. I think Cramer has pushed this stock in the past.

    6) is a TIE. Yes that allows me to sneak a seventh in for consideration! The aforementioned GMXR natural gas play which is taking a tumble because the weak economy trumps future vehicle usage... And Heavy construction play Perini- PCR- this too is being slam dunked for a slowing to a crawl economy the only problem is they already have all of these Gov and other contracts and around $14 a share in cash on the books... so at $16, well we would be getting quite a deal wouldn't we? The only problem is the sickening way these plays can dive- Take Chicago Bridge & Iron as an example, I got hurt there... Perrini has notched down the last three days a dollar a day. At that rate it will be zero in 16 more trading days. You get the point.

    Well as you can see not a Chinese battery maker among the bunch! This combined with my sudden attraction to boring Munis shows a certain change in thinking on my part to be sure, a change that perhaps will be around for quite some time. ~stoney
     
    #44     Oct 15, 2008
  5. Folks I woke up feeling natural gassy!

    I really can't explain it, I'm not an oil & gas guy usually.

    I dipped a toe into the hedge Fund reccommended SWN yesterday, I think it was $22 or $21, I haven't got the specifics yet and this morning I am lobbying for the GMXR... So from no exposure to two natural gas stocks! I do so hope I am right here. I will be holding my nose and holding these stocks throughout the winter.

    Now I have to take my dog to the vet again. He's had an unfortunate case of infected anal glands that is really getting old but I am starting to wonder if something worse isn't going on. He's had two weird sort of seizures lately in his legs... I don't know I fear the Dr and the Vet with equal panic. Hopefully this will work itself out.

    When I return later- Perrini will be at the top of my list and VRTX, maybe APWR and since clean coal was mentioned so much last night by both sides, I'll be revisiting FTEK's books. I would like to buy something tech related, but nothing is jumping out at me now.

    talk to you later! Good Luck Today. ~ stoney
     
    #45     Oct 16, 2008
  6. Well what do you know :) natural gas is the place to be today!

    SWN $22- $25.... 16 plus %

    GMXR of course lagging $25.50 - $27.50 ....

    Glad I bought em both. Forget I said that.

    Other movements of note to our watch list...
    interesting open on MI... $17.50 close $18.88 open!!! and that was in the face of bad futures and very weak financial sector... it rolled over with the market but could it come back this afternoon... $18.03 presently, looks interesting. Traded a days volume already, a close over that interday opening high would be nice....

    VRTX- kind of backing and filling at $25 looks like it might be a good play too. Small piece on Street.com today by adam Fuerstein on the name...

    WGOV- with wind plays getting smoked with solar, this name continues to impress @ $29.

    TWP- mired between $14.04 and $14.69 ~ stoney
     
    #46     Oct 16, 2008
  7. Stone quit bumping your gibberish thread. Just create a journal.
     
    #47     Oct 16, 2008
  8. Hi Stock, we haven't talked in a while... bump me up a few stars and I might put this one to bed. Not before a few more winning ideas though.

    The whole commodity space reeks of a smelly bottom here- Look at AGU right at a 52 week low....
    - Potash, a move later today over the high near $82 will set off a furious run to $90.
    - Alpha natural ANR has put in a TRIPPLE BOTTOM at $31.50....

    .... Archer Daniels Midlend ADM- may be worth a poke here.

    In general the NDX put in a nice double bottom today too, the SPX had a higher low... if this was a normal world we would rally very hard into the close today!

    I've got the ole' buy hat on. Wish there were more of me out there. ~ stoney
     
    #48     Oct 16, 2008
  9. From NotableCalls this morning-

    Merrill Lynch is upgrading Archer-Daniels-Midland (NYSE:ADM) to Buy from Neutral noting the recent ~40% correction in commodity prices has lowered ADM’s working capital needs and improved the company’s cash flow significantly. This improvement in cash flow has also allowed ADM to repay all the commercial paper ($2.2 billion) it had outstanding at fiscal year end (June). Firm expects commodity prices to continue to moderate, which should strengthen ADM’s balance sheet further.

    Raising F2009 EPS estimate on LIFO gains: As crop prices rallied over the past few years, ADM’s earnings have been negatively impacted with nearly $800 million ($0.83 per share) in LIFO charges. With crop prices retreating, they are now estimating a sizable LIFO gain in F2009— $0.32 per share vs. previous $0.05 per share estimate.

    Share repurchase possible given cash position: Given that ADM had roughly $2.8 billion in cash and cash equivalents on its balance sheet at F2008 year end (or approximately 25% of its current market cap), and considering the sell off in the stock over the last few months, the firm thinks the company will come under increasing pressure to repurchase shares. They would expect some movement on this front once the company has wrapped up its annual meetings with the rating agencies—scheduled to take place this month.

    - The shares have traded down ~60% over the last 6 months on a combination of factors, including: grain spikes early in the summer following widespread flooding in the Corn Belt; concerns about sustainability of earnings in the near term; concerns regarding demand destruction from higher crop prices, and more recently, concerns regarding the company’s balance sheet and its financial flexibility

    The end-demand is still there, especially with prices now down. ADM stock has gotten hit along with the AG space but it's quite clear they stand to benefit from lower prices as the are merely processors.

    - It's cheap, trading just 6.5x FY09 EPS estimate. Especially with MLCO upping their ests due to LIFO. Free Cash Flow yield stands at a whopping 30%+. Roughly 25% of their mkt cap is cash, so there are NO liquidity issues.

    - ADM has managed to repay all the commercial paper ($2.2 billion).

    - Catalysts ahead. Not huge ones but it would be nice to see ADM buying back stock here.

    ADM's just so much better than the Ferts.
     
    #49     Oct 16, 2008
  10. We got em on the run boys!!!!!

    What did stoney tell you!

    Into the close whip em' oh I wish we had fifteen more minutes to this day. My peeps picked up some calls for me I admit I don't understand these things... $12.50 to $31!!!!!!!!! OH BABY RAIN GREEN FOR ONCE!!!!

    YES. ANR is building a 2 day base through this mess. And with the big coal earnings from BTU today and earnings at the end of the month for ANR, this is looking tasty to me.

    How bout dem natural gas stocks eh!!!!!

    This whole commodity sector is turning... me thinks... or at least the forced selling by Hedgies is drying up. Watch AGU & POT for possible big moves, and look to ADM as an investment.

    Some house was out clobbering solar stks today they downgraded a bunch but didn't mention our fave-
    ENER!!!! Wow look at the daily there- six mf- ing bucks there for all of you who didn't have a vet appointment, a workout and a kid pickup!!!!

    Well if I don't get my fourth star after today I'll never get one.... Now a quick bath for the sinus infection some well deserved " Sunshine " (new stuff today!) And then out to drink hard tonight. Let the waiters and barkeeps celebrate tonight in NYC. For one night we can all f*ing RELAX. I truly think I came close to losing my mind this past week. But as this thread attests one can control one's fears long enough to make some smart moves even in this horrible investing climate.

    Now for all of those flippers who don't want to hold stock anymore a nice solid late day extension tomorrow would be oh so nice. Keep an eye on our names for entry points and have yourselves a very well deserved night out tonight!

    ~stoney

    PS- I left an order in for PCR, Looks like I missed getting filled by cents of course- looks like that's moving off it's lows too. CAN I BE SEEING THIS!!! GO MARKET GO......
     
    #50     Oct 16, 2008