Chart showing the cost of the financial bailout (still counting….),
From the The Disciplined Investor
|Race to the Moon
|The New Deal
|Invasion of Iraq
|2008 Credit Crisis Bailout
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
Interesting chart showing how the four worst bear markets compare…
Andrew Horowitz, a participant on MSN’s Strategy Lab, has been up 13% this year. He apparently called the capitulation point on Friday and is now going long several stocks.
Here is a neat little site that allows you to backtest your own custom portfolio using data from 1972-2007.
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?
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.
Tracking the performance of various asset classes year to date…not pretty for anything except managed futures and market neutral funds (and of course bear funds).
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.
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.
Jon Markman calling the possibility of Dow 4000??? That would mean serious trouble for all of us…