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Latest Comments44 Comments
Citigroup Sees Gold Reaching $2000
ETF Update: A New Look at Gold
"Great Stocks, Great Performance as of 12/30/05"
...2005???????...uh, Jeff, you think maybe somone oughta upadate the website now and then?
AIG's Bold Move and Why I'm Shorting the Long Bond
The Convertibles Collapse Offers Investment Lessons for All Investors
Gold Trade Proves Spectacular to the Upside
..."document"... asking a gold bug to "document" his callls?????...what suburb of "Fantasyland"... do you live in?
On Dec 01 08:36 AM leh wrote:
> Yes, nice call BUT it would be very helpful (and honest) to document
> how many false starts/head fakes you've bet on in the gold miners
> over the past several months and how much this has cost you to date.
> Technically the sector has just broken out from its correction from
> March/April timeframe, and strict trend followers are now looking
> for entry points on pullbacks. As someone who has been painfully
> headfaked by this sector multiple times in the past couple months,
> I'm learning the old lesson of price confirmation (vs guessing) before
> jumping aboard this time. Nice to catch the bottom, for sure, but
> honesty demands we ask how many missed swings you've taken to date
> before hitting this homerun.
Gold In Backwardation? Not So Fast ..
"The mainland is seriously considering a plan to diversify more of its massive foreign-exchange reserves into gold, a person familiar with the situation told The Standard."
...ah, yes, the old "person familar with the situation" gambit!...and this reference is in some hokey online financial Chinese version of "National Enquirer...perhaps that "person" have been the character quoted later in the article:
"It's the right time to increase the gold reserves, as the price is about US$710 to US$720 per ounce," said Wan Guoli, vice secretary general of the China Gold Association."
...gosh, a gold bug encouraging an increase in gold reserves -- who'd a thunk it?!...of course, given that the Chinese government is dumping money into the economy as a stimulus, maybe it wouldn't be very encouraging to the general populace if, at the same same time, the government looked like it was starting to hoard gold...brother!...gold bugs are such a pathetic lot!
On Nov 26 11:29 PM User 307894 wrote:
> Pay attention to professor Lewis at minyanville.com
>
> Read this article on Gold potentially hitting 1200 this year and
> 4000 to 5000 next year. These guys have been damn accurate on predicting
> these last two years.
>
> www.minyanville.com/ar...
>
>
> Buy Gold NOW!!!!!!!!
Last Thursday Was the Bottom - It's Time to Get Back in
Buffett Serving Free Lunch?
"He (Buffett) has the cash, he doesn't have to post collateral (we hope), he's comfortable that in 18 years the market will be 65% higher, and he claims he doesn't care about the mark to market risk. I'm not sure he thought it through completely though: even if he has no collateral issues, the action of the person covering themselves against his risk certainly does, and that person is screwing up Warren's ability to finance himself elsewhere."
crookery.blogspot.com/...
On Nov 25 05:51 AM Fran the man wrote:
> Yes, you are right, BRK will have to recognise the liability on their
> Balance Sheet and mark-to-market/model the “fair value” movements
> in these puts.
>
> However, from a credit worthiness perspective, the approach the ratings
> agencies (who are the final authority when it comes to credit risk)
> will take would be to look at the terms and tenor of the obligation.
> BRK has written these at-the-money puts for a duration of 15 years
> (minimum) and does not have a present obligation to settle this “debt”.
> Remember there is a condition probability here a.) firstly the indices
> must close below the agreed value, and b.) should this occur BRK
> must pony up the cash to the extent the puts are in the money (for
> the counterparty). BRK can only ever default on this obligation (should
> it be in the money for the counterparty) in 2019 and longer dated
> debt carry a much lower weighting than shorter dated debt in assessing
> credit risk (to clobber this point to death: BRK cannot default on
> this obligation for 11 years still).
>
> Secondly, and more importantly, what all this illustrates is the
> inherent limitations of accounting (don’t get me wrong accounting
> is imperative for the proper functioning of capital markets, but
> will never be an exact reflection of economic reality). This BRK
> put is a case in point: the question here is what is the economic
> reality for BRK? Let’s take the S&P500 put as an example, firstly
> obviously Mr Buffett is bullish about the prospects of the American
> economy (and probably an increase in inflation) with a resultant
> increase in the underlying nominal earnings of the S&P500. During
> 2004 (when these options would have been written) the S&P500
> earned c. 63 per unit and S&P500 was trading at 1150 (the S&P500
> on was trading at or slightly above its long run historical average
> in terms of. price earnings, price-to-book, price-to-sales etc.).
>
>
> Should nominal GDP growth in the US average 5% p.a. (say 2.5% inflation,
> 2.5% real GDP growth) the S&P500 would earn 131 p.u. in 2019,
> at 1150 this would translate into a PE of 8.8. The S&P500 has
> traded at this multiple or lower only 35 quarters out of 288 (i.e.
> since 1936). Although possible it is not probable. Also bear in mind
> that the S&P500 is subject to survivorship bias i.e. if a company
> loses a big chunk of its value a new, higher valued, company will
> be included, introducing a upward bias to the S&P500 (and an
> additional benefit for BRK) vs. e.g. a single stock reference asset.
>
>
> The above illustrates the practical reality, BRK’s thinking and the
> economics. With respects to the real cash flow argument there is
> truth to the argument that traders will be able to sell these puts
> at the prevailing market price to other traders. That is exactly
> it: other traders, the real patsies are the traders trading this
> thing because at some point, like all other market inefficiencies,
> it will correct and pity the poor sole stuck with it who bought it
> using historical volatility to value it instead of looking forward.
>
>
Wall Street Journal: Homebuilders Want $250 Billion Stimulus
Killer IPOs: A Cautionary Tale
"The Logic of Paying for Good Professional Help"
...where he proclaims:
"With few exceptions, hiring the right kind of professional help makes great sense: You will almost certainly be better off with such help—net of costs—than you would be without it."
...funny but, while rationalizing his fee structure, he neglects to mention any refunds if he loses everything you own...I wonder how well his advice has stood the test of the past few months -- he doesn't say.
Take a Stand Against Government Spending
Buffett Serving Free Lunch?
Value Investors: Stay Strong, and Follow Warren Buffett
I'll Sell You All the CDS on Citigroup You Want
Multi-Family REITs: Which Way Is Up?