Monday, November 10, 2014

11/10/14 The Shanghai-HK Connection

http://www.marketwatch.com/story/chinas-stock-markets-change-forever-next-week-2014-11-09?link=MW_home_latest_news

The Shanghai Composite jumped +2.3% early this morning on the news.  Note that FXI (iShares China Large-Cap) barely budged today, but that's not where the 'A' shares are traded.  CAF ( the Morgan Stanley China A Shares Fund), on the other hand, jumped +3.64% and closed at the day's high.

Investor psychology remains muted at this point (despite an initial +560 point spike in Hong Kong's Hang Seng this morning, it settled to close just +194 points higher).  IMHO, today may have marked 'buying opps' in FXI, EEM (iShares MSCI Emerging Markets), and even CAF.

164 comments:

  1. BALT - Mark, it looks like more losses?

    Take a look at this TOF

    http://www.conferencecalltranscripts.org/summary2/?id=1254531

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    Replies
    1. Yeah, but looking to see if there's something else there. Judging by the stock action it must be 'no'.

      Delete
  2. Honestly I think the China move was related to a meeting of heads of China & Japan as well as this link thing

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  3. I've completely soured on the dry bulk shippers due to the coal exposure. I think that is going to be a big issue going forward. A big chunk of future growth was predicated on that and with a market already in a huge supply surplus (ie too many ships) it could be a big problem still for all of them.

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    Replies
    1. I agree. The steel/coal market seems like it is in for a bad time. If I was going to go for shipping, I think energy/lng would be the place to go. Or the rails would also be good to buy in transportation if we got a pullback.

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  4. Fiat Chrysler Automobiles NV picked up 1.1%. Goldman Sachs initiated coverage of the car maker with a buy rating, saying the Ferrari spinoff "marks the start, not the end, of an FCA value creation equity story to 2018."

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    Replies
    1. Wondered why it is up so much in Milan (2.6%).

      That is good news though and hopefully we see more analysts get on board with the story, Do you have a copy of the report?

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    2. 8:17 EST - Goldman Sachs starts coverage of Fiat Chrysler (FCA.MI, FCAU) at buy and a EUR13.30 target price, 50% above yesterday's close, as it sees shares getting future support from the successful completion of announced capital-market transactions, the spinoff and IPO of Ferrari and the cleanup of the company's capital structure. Meanwhile, risks going forward include difficulties in executing the capital-market deals, higher capital spending and a lower-than-expected valuation for Ferrari. FCA.MI rises 2.7% today to EUR9.13. (eric.sylvers@wsj.com; @ericsylvers)

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    3. There's still not even close to "enough" volume to suggest institutions are getting into FCAU. 1.4 Million shares = $15 Million. That's nothing. Several institutions own $1.5 to $2B each of GM and F. If an institution wants to take a $500 Million position it will need to purchase 40 million shares. There has only been about 8.5 million shares traded in total the past 7 trading days.

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  5. Wondering over here, what happens if the euro falls off a cliff? Obviously the $US goes for a moonshot but other things will also happen?
    Such as: Which way will energy/autos/banks/commodities move?

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  6. OIBR - Can't believe this one's trying to walk away from me...

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  7. CP- Here's you ENPH entry. I still believe for a longer term hold 8 needs to be tested.

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    Replies
    1. I agree completely. If it gets to $8 though then it probably goes lower.

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    2. Yeah, I haven't been keeping up with the story, $7 would be a round trip?

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    3. "Vivint Solar: CY14 deployment target intact despite weak 4Q14 guidance
      11/11/2014 5:48 AM

      Vivint reported strong 3Q14 installs and nominal contracted payments remaining compared to our forecasts. 4Q14 revenue and MW guidance was a disappointment, and likely reflects growing customer concentration in the Northeast. Underlying fundamentals like Y/Y deployment & market share growth remain impressive, however, and we reiterate our Buy rating."

      Delete
    4. If it wasn't for government welfare checks, these solars would be dead in their tracks, IMO, same thing as electric cars, the GM's and F's of this world understand marketing and realize they can't make the electric car viable despite subsidies, right?

      Delete
  8. Can we talk about how in the hell its possible this guy is able to manage money for other people given his performance inception to date?

    http://www.gurufocus.com/news/290960/john-hussman-the-stock-market-is-overvalued-by-100-

    I'm not saying the market won't eventually drop by 50% some day but shit that could be after this guy is completely wiped out.

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    Replies
    1. I guess it's the same phenomenon as gold way above $400, is this guy working for someone? Maybe he's a gold salesman?

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  9. GGN - $7.95 is the line in the sand

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  10. What the hell happened mid-Oct, anyway? I never did figure it out.

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  11. Is Europe gonna have to get a reprieve to use coal, or go nuclear? Where's the energy gonna come from? Who owns the Amazon carbon credits?

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  12. CP - It appears sonce Canada can't agree on where to build pipelines, rail is the solution?

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  13. LGND vs LGCY - I keep getting these two tickers mixed up, LOL, and LGND is on a tear, which makes it worse...

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  14. GGN - Looks like a keeper, for now.

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  15. DB - Too bad Europe has such a case of constipation, no telling what might happen there.

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  16. TLLP - These guys own the Bakken rail terminals, right? So lack of pipelines means these guys should keep plugging away?

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  17. This guy was just on Fast Money:
    http://online.barrons.com/articles/SB123275430466611603?tesla=y

    david gerstenhaber

    Pretty old article but very impressive results given he actually made money in 2008. I like his approach a lot...or at least his approach as of 2009 when the article was written.

    "In fact, its outperformance was more likely attributable to money not lost, rather than to money earned. Jarrett Posner, Argonaut's chief operating officer and risk-oversight manager, says "there will be plenty of times when we will make a wrong bet or get into a position too early, but we protect ourselves through aggressive risk management."

    This includes setting stops across nearly all positions, closely monitoring them and altering them when necessary. Investments are largely limited to liquid positions to ensure efficient pricing and the ability to exit immediately. To avoid excessive risk, the fund tries to determine how investments would behave under various scenarios -- including the most adverse. And it generally prefers to hit lots of singles and doubles, rather than home runs.

    Gerstenhaber also systematically takes money off the board as targets are hit and constantly reevaluates targets to avoid being hurt by unrealistic expectations.

    The fund seeks to limit daily losses to no more than 2.5%. If losses mount in any calendar month to 7%, positions are sold or completely hedged to prevent further damage.

    "This not only prevents losses from spiraling," explains Gerstenhaber, "but creates an automatic 'time out' that forces us to reevaluate all positions." At the start of the next month, after the team figures out what drove the losses, some positions are reinstated, while others are replaced.

    Another line of defense is the fund's risk committee. Any member can call an immediate meeting if he fears a position is at excessive risk. The procedure got the fund out of commodities last June, right before they peaked."

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  18. Sold my other small US Bank - FUNC. (sold BOCH last week)

    Both had weak earnings and I'm not sure if there's enough of a tailwind to expect this to improve, so I'm out and will find something else tobuy.

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    Replies
    1. BKJ is one in the micro cap bank sector I brought up probably 2-3 years ago. Their EPS growth has slowed down recently due to branch expansion but assets continue on the rise. The founder was previously with another publicly traded regional bank that was bought out in the mid/early 2000's I believe so he has a good deal of experience in the sector. Plus, NJ has been a really good economy for a long time.

      Delete
  19. LGCY - Added a modest amount @ $19.80, I'm a little concerned about dividend sustainability.

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  20. MKSI - So strange, BACML has MKSI listed in solar stocks... LOL, not sure the reason, maybe semiconductor is the category but INTC isn't listed with it.
    AMD - Can we get this one at b/v soon?

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  21. TSM - Told ya this one would do well, the equipment engineers run the product through the machines and sleep next to their machines, they know them inside and out. Unlike INTC, where they don't take ownership and instead look for someone to lay blame on. Unfortunately sleeping next to your machine exposes you to certain hazards but competition is fierce in Asia.

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  22. (a) Spot gold (after plunging as much as -30/oz on Monday, shaking out all but the strongest hands) has recovered to 1170 following an overnight low of 1145.
    (b) I plan to close RYPMX (Rydex Precious Metals) end of day. Based on current pricing for GDX, it may close around +6%. I had 37.5% of the port invested, which should boost YTD gains by +2%. I call that a line drive!
    (c) EEM and EWZ (Brazil) trading flat. I plan to close RYWVX (Rydex 2x Emerging Markets) end of day as well.

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  23. Closing all other miners here. GDX (majors)/ GDXJ (juniors)/ ABX (Barrick) for one-day gains of +3.6%/ +5.6%/ +2%.

    Closing EWZ and PBR, one for a minor loss, the other for a small gain.

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  24. Replies
    1. He'd better get his happy ass up on stage!

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  25. Tonight's movie is "Kung Fu Hustle"

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  26. · Operating Revenue: $7.1 million, up 236% from $2.1 million in the third quarter of the prior year. Total revenue: $8.3 million, up 266% from $2.3 million in the third quarter of the prior year.

    · Cost of Revenue: $19.5 million, up from $4.8 million in the same period of 2013.

    · Total Operating Expenses: $66.7 million, compared to $15.7 million in the third quarter of 2013.

    · Loss from Operations: $58.4 million compared to $13.5 million in the same period of 2013.

    · GAAP Net Loss Attributable to Stockholders per Diluted Share was ($0.45).

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    Replies
    1. Yeah, but is it a real loss never to be seen again or a business cycle cap-ex thing?

      Delete
    2. ENPH: M. cap 450M. Q4 Rev. 103M, PPS 10.90 EPS .02
      VSLR: M. cap 1.3B. Q4 Rev. 7M, PPS 11.40 EPS -.45

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    3. Can't fault actual earnings! PPS is a function of float and "losses" can be cap-ex spending (not sure, but I think it's included)? Short term investment for future growth is good depending on results.

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    4. VSLR is one of the most preposterously valued companies I've seen in a long time.

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    5. Thanks If I might ask, preposterous based on what metric, primarily? Government programs can turn anything into gold, and there are so many people out there who think a 15 watt solar panel can power a 1,500 watt hair dryer with power to spare....

      Delete
    6. $1.3 Billion valuation for a company that might do $65 Million in revenues and lose $2.60 in 2015. Forward price to sales of 20X. That's preposterous. Even if they grow really rapidly over time, the odds of this going down significantly first are very high.

      Delete
  27. Xerox - Well maybe next year, with some luck?

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  28. Replies
    1. $28.8x, just maybe? Wish I could get a grasp on German intentions.

      ORI - This one looks like it might want to take off, I sold it @ $14.46 and took a little loss from my original entry around $14.85ish
      Don't know if BB still likes it?

      Delete
    2. Still own it and it is one of my largest.

      Great yield, been increasing for 30 years, but undervalued due to a separate mortgage insurance division, which is separately incorporated (so a wall from the regular business), but improving anyhow and no longer a drag.

      Should get over $20 with time.

      Delete
  29. Regarding solar, valuations on a lot of these got a bit out of whack and you had a ton of people rushing in to buy ahead of the yieldco spinoffs which everyone agreed would be a big winner. I think too many people got on the same side of the boat so its leveling out to an equilibrium state.

    Plus with falling oil there’s this perception (probably wrong) that solar will get hurt. I think SPWR is the best one but even that one isn’t really cheap. The tailwind for solar is there but there are still significant subsidies for the industry that are supporting things and the cost of solar isn’t on par with alternatives yet. Should happen over time. I like SPWR the best because Buffett and GOOGL have backed their projects / technology.

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  30. The BALT / Coal trade is probably not a bad trade right now. Its all about perception:
    *on one hand its perceived that republicans will help coal because the EPA is viewed as pro Dems, yet its probably too obvious of a trade
    *on the other hand everyone hates coal and is avoiding it like the plague.

    So which force wins out: the too obvious of a trade force or the hate force?

    I think the group as a whole goes up because too many people hate them. But it won't last and retests of lows will happen eventually. Doesn't mean you can't see substantial rallies in them and the shippers in the meantime. I prefer less risk now though.

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  31. We were using this checking account to keep a rainy day fund in but it earns a whopping 0.02%. Do you guys know of any money market type funds that I could put this money into that would earn more and not lock us down for a certain amount of time?

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  32. Sold my SPY out the money calls for a slight loss. It was a long shot and I got lucky that it bounced back as high as it did as I bought them before the October pullback. I was hoping for a big year end rally based on perhaps the election results or the ECB implementing QE or general market chasing, but it looks like most of these catalysts are gone.

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  33. I dunno, does it seem like market has stalled and needs a pullback?

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  34. DBC - Where's the bottom on this one?
    BTU - Holy crap, call your Congressman and ask if he's long coal?

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  35. Wilbur Ross getting more into oil shipping - I think better than the traditional dry shippers:

    http://www.bloomberg.com/news/2014-11-12/wilbur-ross-orders-four-supertankers-in-extended-oil-bet.html

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    Replies
    1. FRO - Looks like $1 is coming, maybe lower?

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    2. Is FRO the play? Damn Ross has had hit some rough patches in the short term on these ideas.

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    3. This area could interest me.

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    4. http://seekingalpha.com/article/2586275-knightsbridge-shipping-ltd-a-compelling-arbitrage-and-share-repurchase-story

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    5. Ross obviously bypassed all the bs debt and went straight to owning the ships, why not? An IPO or selling them for scrap might his mechanism for exiting the position? But, owning them outright is a pretty bullish bet, no?

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    6. If you own them outright you don't have the markets to force you to do things you otherwise wouldn't. You just buy and hold them.

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  36. ORI - If I had some idea of what the heck prompted the mid Oct. broad market selloff, that would help me decide whether or not to anticipate a repeat in the near future.

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  37. AMAT - I'm thinking this quarter Tokyo Electron sucked these guys dry.

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  38. Jesse's steeling my trade!

    http://stocktwits.com/message/29152384

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    Replies
    1. Bounce here with another test of $8 thereafter. How sustainable is this business model is my one concern. These guys are based out of Petaluma...you gotta spy on them.

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    2. I have 3 friends that work there. I'm told additional products are in the works but nothing specific. Their inverters will soon reach efficiencies so great that further improvment won't be cost effective. At that point they probably get bought.

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    3. When does GE introduce their version?

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    4. GE wouldn't bother. They'd just buy them. Not worth the effort from scratch I'd suspect.

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    5. Yep, I'd also guess GE would buy them, $467M seems like a corporate bargain. A lot of insider selling though?

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  39. VSLR - BACML has a $24 target on this one.

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  40. TSL - Not doing well today, is this b/c coal is back on the table?

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  41. FWIW - Bill came back to blogging at the old site ...

    http://www.billcara.com/cara-community/bill-cara-commentary-on-capital-markets-monday-nov-10-2014/

    http://www.billcara.com/cara-community/bill-cara-commentary-on-capital-markets-nov-12-2014/

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    Replies
    1. Let me guess before looking, he's talking up gold and especially silver and badmouthing the $US, which is like the strongest currency out there.

      Delete
    2. I don't know Bubba ... looks like a Timing-Band calculation to me (perhaps from Geoff) ...

      The question is always when.

      As a guess, I believe the equity crash, and it will be a crash or a so-called “hard landing”, will happen within a 12 to 18 month time frame, following a number of frightful concerns about economic recessions and currencies instability, among others. The big hits will come especially in the very emerging market economies like China, Brazil and maybe Russia that carried the global economy higher over the past decade and more.

      That puts the start of the danger zone from September 2015 to March 2016, as I see it.

      Delete
    3. That guy is whacked, or he hates his readers.

      Delete
    4. Maybe so ... or perhaps he was like many Gurus who thought they had it ALL figured out and there was nothing that could come their way that they couldn't explain / accommodate within their view.

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    5. No, I had asked him thought provoking questions that he obviously chose to ignore completely, when confronted directly he got rude and blew up.

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    6. CP -- He was trying to build his reputation as a Guru. He didn't know. BUT Really NONE of us KNEW what the FED was prepared to DO to Support the Market and it has gone on for 6+ Years ... Very FEW predicted that

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    7. Yes, I comprehend that concept but it doesn't seem to be quite that way considering real estate has recovered (multifamily dwellings and very high-end have outperformed, LOL). How can home building resume when there's nobody to buy a home, homeless rates have steadily declined, right?

      It's globalization that created the over levered crash where credit kept extending beyond sanity until POOF! And the gamblers were/are being bailed out. Now US corps claim they can't find an educated workforce (umm, no duh, they abandoned their workforce decades ago).

      So if the $US rallies from here the PMs and US oil producers don't seem like a good place to be.

      Delete
    8. CP -- I think we're in for a WILD MACRO ENVIRONMENT Type of Market - one in which these Central Banks will have a very hard time controlling. I've been reading a lot about Market Profile / Volume Profile recently. Balance -> Imbalance - Balance , etc These Central Banks have exerted their 'external controls' to establish 'Balance' but that will eventually Change. The 'Containment' of Volatility leads to its EXPANSION.

      Delete
    9. I liked it too, until I realized it wasn't subjective and intentionally useless or misleading.

      Delete
  42. Now that the $US is higher than a kite, Canadian oil seems more competitive than it did during summer. Can't figure out what SA is actually attempting to accomplish.

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    1. $USD ... from Shjack ...
      http://www.screencast.com/users/springheel_jack/folders/1411/media/b1b40d29-21c5-42b2-862c-38d270bc7287

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    2. For some reason I can never get that crap to download.

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    3. Have you got it????

      http://www.screencast.com/users/springheel_jack/folders/1411/media/b1b40d29-21c5-42b2-862c-38d270bc7287

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    4. I got it in another browser, thanks. So looks like a run to 105, is that right? If so, would be consistent with a scary fall in the euro.

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    5. http://www.channelsandpatterns.com/2014/11/us-dollar-breaks-up.html BUT my laptop works harder here

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    6. Wow, looks pretty convincing the $US might have a ways to go on the upside so PMs should be a good short along with expensive US oil and anything exported.

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    7. Yeah, I have the chart, it's quite interesting.

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    8. CP -- one of the things I really liked about the BC Blog was his Effort to cover so many sectors in his EOW-Reviews. It was a lot of work although at the end it was not so good and there was that 'just skimming the surface' feel. BUT there are other sites that focus more on this-and-that say certain Futures contracts ...

      http://www.ino.com/blog/2014/11/weekly-futures-recap-with-mike-seery-62/#.VGPtbzTF97d

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  43. Bahahahahahaha:

    "So I say to you this is a time to prepare for a cataclysmic market event that may occur once in 50 or 100 years. It is not a time to discount risk, or to follow the lead of those who have adapted well to the FIFO (first in first out) trading model, like the well-paid, derivatives-loving managers from the investment banking and private equity world, the very people who posture well daily in their bought-and-paid-for media, that I so much resent.

    In fact this is a time to seek out wise counsel from a trusted confidante, an independent registered investment adviser (RIA) you can meet with belly to belly who will work as a check and balance on the decisions made by an independent portfolio manager the both of you have confidence in.

    A market crash of the kind I envision is on the horizon will destroy much of the capital of most of the participants. Team work then is essential and the first rule of thumb is that the fight to survive a crash is a matter of your team against all the other teams, plus other individuals, governments, bankers, fund managers, and the like.

    The odds are not good unless you have a very good team.

    In a healthy market, one based on natural law, we all can win. But, as I say, this is not a healthy market; it’s a corrupt one. This market will collapse, I believe, probably sooner than later, simply because it is corrupt.

    This market is, as a consequence, an arena where the fight is for survival. Something like the 1920’s, which gave us the Great Depression of the 1930’s following the crash.

    For those of you who have been reading the Daily Reports of my associate Geoff Goetz, I believe you can say that he has proven himself to be a truly independent portfolio manager and trader of note who warrants the public’s confidence. Geoff is a competent portfolio strategist, and he cares about people like you."

    In other words...we care about you, we're RIA's, and we can be your trusted confidante. Did we make money since 2009? Hell no we lost a sh*t load! So yes, we are hurting for new account money.

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    Replies
    1. If we get a 10% pullback that doesn't immediately return to new highs I can guarantee you that they will try as hard as possible to spread fear.

      Delete
    2. I missed a lot of upside and rode PMs down until I realized Cara was just lying to me so his buddies could unload their PMs, I sat listening to my nephew regurgitating that same BS this past summer, making the case for why he bought a couple hundred worth of silver ($21 at the time), and I simply told him "You know what, that sounds exactly like a sales pitch?".

      Delete
  44. ENPH - I think if you know this company at an insider level, with that kind of visibility you can make a comprehensive decision.

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  45. $4.3B is a pretty small fine, must have been some very minor infractions involved.

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  46. Seems like a pullback of some magnitude might be a right shoulder of an iH&S? Like to 1940/50ish area?

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  47. BC - Holy hell, have you guys seen this chart?

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  48. AXL - Where's the recession?
    RLGT - Breakout from here or come back to earth?

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  49. GEVO - Earnings were y-day after close.

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  50. This is what I've learned: there are no gurus. Find a strategy that works for you, and stick to it. Which is exactly what a real Indian guru would tell you.

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    Replies
    1. Agreed completely. I posted the above only to point out just how sleezy of a sales pitch it seems (at least to me). Maybe he's right and we do crash in 2015/16.

      Delete
    2. I agree too. A strategy that fits one's personality. And as 2nd says, stick with it.

      No one has a crystal ball for next week let alone next year and most of his macro calls would have cost you big time.

      Delete
  51. Very interesting move by Buffett in purchasing Duracell. I think its a play on solar/car and energy batteries than consumer products. Could be wrong but he has moved heavily into solar and GM and this could be the trifecta.

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    Replies
    1. This would make me very nervous as a Tesla shareholder. The main competitive advantage TSLA has is its battery technology. Otherwise its just a $30 Billion car company selling 30 to 40k cars per year. Electric battery cars are the way of the future but there are some major hurdles to get to mass adoption and the assumption is that Tesla will be the major player in a potential huge market in the near future which is pretty aggressive. As it stands now they are worth $857,000 per car made while FCAU is worth $3,750 or so on the low end.

      Delete
    2. Pretty sure Buffet (Munger really) is already into batteries in China with BYD.

      Delete
  52. Does Marchionne have an ulterior motive with the Ferrari spinoff?
    Thursday, November 13, 2014
    Eric Reguly
    Print this article
    ROME — Why did Fiat Chrysler Automobiles CEO Sergio Marchionne decide to spin off Ferrari? Two weeks after the Ferrari deal was announced, the auto world is still asking. Could it be that he was trying to make life difficult for rival Volkswagen?

    Ferrari is 90-per-cent owned by FCA. Late last month, FCA announced it would sell 10 per cent of its Ferrari shares to the public and distribute the rest to FCA shareholders on a one-for-one basis, after which Ferrari will trade as an independent company on the New York Stock Exchange and a European bourse, though not necessarily Milan.

    Driving Ferrari out of FCA’s garage was done to surface Ferrari’s value, which was buried in FCA shares, and provide some capital to finance FCA’s expansion drive. That effort will, among other projects, see some €5-billion ($7-billion Canadian) pumped into the ailing Alfa Romeo sports car brand alone in an attempt to transform it into a global marque that can compete with BMW and Audi in the market for low-slung cars that go fast and cost a lot of money.

    But Mr. Marchionne is a clever boss, so there may have been an ulterior motive. That motive may have been to fend off Volkswagen or force it to pay full value for FCA and Ferrari if the German auto giant were intent on buying either or both.

    Mr. Marchionne has been Fiat’s CEO since 2004 and saved it from destruction. Ditto Chrysler, which he bought out of bankruptcy for little more than a promise to the U.S. and Canadian governments to invest in new cars and make it a player again. It worked. Now he is trying to leverage the Chrysler, Fiat, Alfa Romeo and Maserati names in his portfolio into global brands.

    The problem is that Volkswagen has similar ambitions and is way ahead of FCA. It is an open secret that Volkswagen covets Alfa Romeo and would love to slot it in between its luxury Audi and the mid-market VW brands. Mr. Marchionne has said repeatedly that Alfa Romeo is not for sale. Ferrari must also appeal to Volkswagen, which has always had a passion for high-end Italian machines. It has owned Lamborghini for years and recently bought motorcycle maker Ducati.

    Buying all of FCA would have been the easiest, cleanest and cheapest way for Volkswagen to get Alfa Romeo and Ferrari. At the same time, such a deal would have given Volkswagen a big presence in North America, through Chrysler and Jeep (VWs have not been big sellers in that market since the Beetle era). A Volkswagen-FCA merger would also fulfil Volkswagen’s goal of becoming the world’s No. 1 car company. Together, Volkswagen and FCA would be substantially bigger than either General Motors or Toyota. (In August, a German magazine reported that Volkswagen had talked to the Agnelli family, which owns about a third of FCA, to test their appetite for a merger).

    Now look what Mr. Marchionne has done. By spinning off Ferrari, he has deprived Volkswagen or any other suitor of a two-for-one deal. At the same time, the Ferrari spinoff has turbo-charged FCA shares. When the Ferrari sale was announced last month, the shares rose about 13 per cent and they have kept on going. Over six months, they are up by a third. FCA is no longer the bargain it used to be.

    So if Volkswagen wants the Ferrari and Alfa Romeo brands, it will have to pay twice, first for FCA and second for Ferrari, whose enterprise value (debt and equity) is estimated to range from €4-billion to €6-billion. Brilliant! Mr. Marchionne has ensured that neither FCA nor Ferrari would be bargain-basement purchases for any suitor. At the same time, the far higher valuation for FCA ensures that if does do another deal he will be working from a position of power, not weakness. Mr. Marchionne is not considered a “car guy,” but he’s no slouch when it comes to devising clever financial structures.

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  53. DWA - Man, I thought DIS owned this???

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  54. SPWR getting whacked on earnings.

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  55. $CYTX ROTH encouraged by the total reboot that has occurred at Cytori, especially
    with the strong focus on being highly selective and thoughtful as to the
    therapeutic indications that the company will bring forward. We discuss details
    from the call further below, but a key highlight is an update regarding ATHENA.
    Following the release of the partial clinical hold (prior adverse events deemed
    not related to the cells in the hear failure patients) management has made
    a major decision about bringing ATHENA forward. 31 patients have been
    enrolled to date (28 of 45 in ATHENA and 3 of 45 in ATHENA II) and
    management has decided to stop enrollment at 31 and analyze the 6-month
    endpoint. The last patient enrolled into the study will reach six months of follow
    up later this month. The company will analyze the data and release the data
    in early 2015. ATHENA I & II had primary endpoints of treatment emergent
    SAEs, frequency of MACE, changes in cardiac function, resource utilization
    and changes in the MLHF questionnaire at six months. Later this month we
    expect to see clinical data from the 20 patient damaged ligament study (soccer
    players) from Spain. We discuss the added therapeutic indications below.
    Management has indicated that they are also taking a proactive approach to
    partnering, by starting outreach now, so potential partners will be ready for
    when Phase II data from multiple indications starts to flow.
    Action
    We maintain our Buy rating and $3.50 price target. We continue to view Cytori
    as a leading regenerative medicine player and believe current valuations are
    attractive.

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    Replies
    1. Little bit of insider buying as well.

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    2. If that gets to $3.50 from here that's quite the move. Haven't looked at it since trading it earlier in the year. Still think it could have some promise but I guess we have zero edge on that one.

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  56. PCRX - Looks headed for the gap down close.

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  57. Not enuff sunlight to recharge comet lander batteries.... Where'd they obtain the calculation to determine solar cell capacity, wikipedia?

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  58. Blast of cold air has arrived, big change.

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    Replies
    1. Yeah I was looking at the forecast in Massachusetts. Nice drop in temps. I miss that cold weather to be honest.

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    2. I know you miss it, I can't understand why.

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    3. haha. it can be a drag at times when the really cold air comes and doesn't let up but the cold crisp air breaths life into a lot of things. Coffee, hot chocolate, warm soup, hot chili all taste better. and i love the silence in the air when snow begins to fall. Can't beat that stuff.

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  59. Here we go,, Hoof Hearted in the gates....

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  60. One man performs 80 Surgeries in 6 hours, demand is strong!

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  61. FCAU has a LOOOOOOONG ways to go up until it reaches the valuation of its Detroit competitors, let alone the valuation of a TTM or TM. This could be a home run buy and hold. The holding part will undoubtedly be the hardest part.

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    Replies
    1. It sure is moving, how far is long? I can't even get any info on it from my broker, not sure WTF, it's hard to do any DD...

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    2. I guess I don't comprehend how brands like Ferrari and Maserati can be overlooked, it just seems so unlikely.

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  62. I guess there must be a report out on energy but haven't seen it yet... I guess it's buried somewhere.

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  63. SCOK - Here ya go, this puppy gonna run again? Kinda looks like maybe. If China transfers their carbon footprint to Mongolia and pipes the gasified coal to Bejing, does that meet requirement of the Obama carbon emissions agreement?

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    Replies
    1. That's a nice looking chart. Coal stocks getting lit up again today. What else is new? I'm sure there's some big $$ to be made in that space but not a chance in hell I would ever touch them yet...other than maybe for a day trade.

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    2. This entire energy fiasco is driving me up a wall, not fun.

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    3. That, and too many open web pages that insist on refreshing themselves constantly which freezes me till the downloading completes.

      Why are software engineers only about themselves and not trying to get along with everyone else as a system?

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  64. CXO - Seems like this one would really frustrate shorts, as it refuses to drop.

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  65. Takata airbags - Outsource them to China!

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  66. More good FCAU press:

    http://www.marketwatch.com/story/morgan-stanley-buy-fiat-chrysler-get-ferrari-stake-2014-11-13

    CP, the reason we can get it cheap is because there is little broker information. Now that the stock has moved to the US, it will improve and push the stock up.

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  67. And Goldman put FCAU on the conviction buy list a couple days ago in case anyone missed it.

    http://www.bidnessetc.com/29096-why-fiat-chrysler-fcau-is-up-today/

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    Replies
    1. Yep, I recall GS did that, and now I see MS is in too. No concern over these two touting the stock? I kinda viewed it as a negative based on these guys are likely not my friend?

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    2. But I love the Ferrari and Maserati brand names, are either one profitable?

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  68. Have to admit TWTR is kinda interesting to me here.

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  69. This morning's rally in the US indexes certainly felt like a short squeeze. Thus my reaction was to short the short squeeze. Opened a small position in RYTPX (2x Inverse SPX) at the 1030 est window. Sized down due to the high risk of shorting at all-time highs.

    (a) Crude oil falls below $75. XLE (an Energy ETF dominated by oil and gas companies) off -2.5%.
    (b) Miners off -1.32%.
    (c) Bonds flat. Europe slightly green. Brazil (EWZ) off -2.5% (again), which has EEM in the red despite strength in Asia. PBR (Petrobras) staggering under a one-two punch (Brazil and crude) to a new 52-wk low of 10.09.
    (d) US indexes remain the strongest of global asset classes. DJIA +26, NDQ +0.36%, SPX flat. Small caps weak (IWM -0.7%).

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  70. TA - Something wrong here maybe, low gasoline prices should be a tailwind.

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  71. This must be the oil report from today, I think:
    http://www.eia.gov/petroleum/supply/weekly/pdf/highlights.pdf

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  72. CP - Seems like THE PIPE decision hasn't been made yet?

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  73. KING - You guys notice this one moving up?

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  74. http://www.marketwatch.com/story/morgan-stanley-buy-fiat-chrysler-get-ferrari-stake-2014-11-13

    Looks like the street is starting to catch wind of this. I don't think it's out of the realm of possibility to see a massive spike up related to the Ferrari IPO, either immediately before or immediately after the IPO. A double from these prices within a year seems possible.

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  75. UGA - Gasoline ETF fell a mere 4.3% today so gasoline autos and perhaps especially pickups have more tailwind?

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  76. Are the dems gonna give us THE PIPE?

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  77. If today's AH's trading holds for BHI, I wont be the only one surprised by the premium.

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