Chart Showing the Cost of the 2008 Bailout

Chart showing the cost of the financial bailout (still counting….),

From the The Disciplined Investor

Spending Cost Cost (Inflation-Adj.) %GDP (Year)
Marshall Plan $12.7 billion $115.3 billion 5.20% (1947)
Louisiana Purchase $15 million $217 billion unavailable
Race to the Moon $36.4 billion $237 billion 3.70% (1969)
S&L Crisis $153 billion $256 billion 2.79% (1989)
Korean War $54 billion $454 billion 14.23% (1953)
The New Deal $32 billion $500 billion 56.74% (1933)
Invasion of Iraq $551 billion $597 billion 5.03% (2003)
Vietnam War $111 billion $698 billion 6.78% (1975)
NASA $416.7 billion $851.2 billion 3.02% (2007)
WWII $288 billion $3,290 billion 129.09% (1945)
2008 Credit Crisis Bailout $4,616 billion $4,616 billion 32.65% (2008)

Jim Welsh, Special Update 11/26/08

Jim Welsh is predicting a 1-3 month rally followed by lower lows…ouch

In the meantime, the market should be able to hold up for 6 to 10 weeks, maybe a bit longer. Traders were advised to pick a spot to go long, once the DJIA dropped below 7,882, using 7,200, the 2002 low as a stop. The actual low last Friday was 7,450. I would raise the stop from 7,200 to 7,700. If the DJIA gets above 9,000, raise the stop to 8,050. Sell half if the DJIA reaches 9,540. For those who missed the reversal, buy if the DJIA falls below 8,300, using 7,950 as a stop. Sell half if the DJIA reaches 9,540

2 stocks under cash: Trident Microsystems (TRID) and MF Global (MF)

Seems like a decent arbitrage/deep value opportunity in the microcap sector, TRID and MF.

Quoting the article regarding TRID:

Trident is actually trading with a negative Enterprise Value of $135.92 million dollars. The company has $230 million dollars in cash ($3.763 per share), and zero debt; forget about the fact that the company has a stated book value of an additional $3.643 per share. The company has no meaningful expenses in its horizon, and given the massive amount of cash on the balance sheet, I simply do not see how Trident doesn’t move higher—at least in line with the cash on hand?

And MF:

CFO Randy MacDonald said:

So said another way, if we take all the assets and liabilities and we liquidate the balance sheet, we would immediately return to our shareholders approximately $900 million in cash. Assuming 120 million of diluted shares, that’s $7.47 a share.

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Crude Slumps
MF Global Hires Roseman as Risk Officer
Crude Falls Further Below $50
Read more on MF Global Ltd., Trident Microsystems, CLP HLDGS at Wikinvest

New Investment Website: ImpactOven

Who needs their own blog to organize their investment resources when you could just use ImpactOven? 🙂

From the site (it’s free):

ImpactOven is your online investment notebook

ImpactOven was built from the ground up with the idea of making life easier for an investor. Its better than other bookmarking services or using favorites because we include investment specific features that you won’t find anywhere else.

Simply save any information you’re reading online into ImpactOven then easily find it again organized by stock specific criteria like ticker, business segment and region. For many sites such as CNBC, key stock specific information is automatically found – saving you valuable time. The performance of securities are monitored from the time you read it so you can always know how your ideas are doing.

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Chadwick Investment Group: New Trend Follower
When Investment Schemes Go Bad
SIPA's Can't-Lose Investment Contest
Read more on Investment at Wikinvest

Jubak: Should you follow Buffett this time?

Jubak’s 11/11 article makes note of Buffet’s fascination with the utility sector and also points out his huge advantage over the common investors when he negotiates deals. Until the credit market settles down, utilities probably won’t have access to the capital they need to expand (2009? 2010?). When they do continue new projects, buy the utilities and their suppliers.

Jubak also recommends purchasing natural gas pipelines for yield in this tough market. He recommended OKS earlier and is now recommending ETP (yielding just under 10%). His target price is $42 for Dec 2009.

He is also holding firm on TC, especially given China’s announced stimulus package (TC mines molybdenum, used in steel). Even with molybdenum prices plummeting, TC has long term contracts fixed at higher molybdenum prices. In addition, their book value is $6.49/share and is currently trading at only 2x cash. His target is $9.90 for Dec 2009.

More on this topic (What's this?)
Stocks Higher 10-Years From Now
Read more on Warren Buffett at Wikinvest