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September 2009

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4

The 50 Best Places in the World to Eat

September 30, 2009 – Comments (5)

Good -- no, great -- list.   [more]

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6

I don't mean to beat this into the ground, but...

September 30, 2009 – Comments (1)

I love how far ahead we were on the whole western China is a better place to invest than coastal China thing. Here's Bloomberg today in an exclusive proclaiming: Chinese Stimulus Winners at Great Wall Best Shanghai.  [more]

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3

Mood Disorders and Shotguns Don't Mix

September 30, 2009 – Comments (1)

Really? We're ok with this:

West, who has battled depression and mood disorders for years, also could face suspension by the league after he was recently arrested for gun possession in Maryland. Police pulled over his three-wheel motorcycle for a traffic violation and found he was carrying three loaded weapons -- two handguns and a shotgun in a guitar case he had on his back.  [more]

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10

Chinese Farmers Still Getting Rich

September 30, 2009 – Comments (0)

An update from Xinhua on a phenomenon I first reported on this past spring:  [more]

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7

Here's What's Fun About Russian Stocks

September 29, 2009 – Comments (3)

Ask a few questions and here's what you get:   [more]

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iPhone to Cost $732 in China

September 29, 2009 – Comments (0)

So says the WSJ. I say good luck with that since -- again -- the people who can afford a $732 phone likely already purchased an iPhone in Hong Kong. For evidence of that fact, I give you our man Jonnie Wang...seen here rocking his iPhone outside Xi'an last July:

  [more]

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15

Washington Bails Out Detroit...AGAIN

September 28, 2009 – Comments (1)

As a NY Giants fan in a Redskins office, I must say it's been a pretty decent Monday. That is all.


Photo credit: http://www.oddjack.com/wp-content/washington_redskins.jpg

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7

You Go, Google!

September 24, 2009 – Comments (1) | RELATED TICKERS: GOOGL

WSJ has done the math and reports that Google's March options repricing now stands to cost shareholders $1.5 billion. Don't be evil indeed. Just another note that it's nearly impossible to value -- let alone pay a premium to own -- a stock that you can't for certain predict the number of claims forthcoming on earnings.


You own our stock? Y'all are suckaz.  [more]

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6

This Stock's a Short, Fools

September 24, 2009 – Comments (2) | RELATED TICKERS: CNTF

CAPS Contest Idea: Short China Techfaith Wireless (CNTF)  [more]

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10

Simon [Johnson] Says: Defang the Banks

September 23, 2009 – Comments (1)

That was the major takeaway from today's talk at Fool HQ and subsequent lunch with Simon Johnson (author of the blog Baseline Scenario). And while I agree with his premise that our economy (and others like Iceland) 1) let banks become too big and 2) let financial institutions and the government cuddle up too close, what I'm not sure about is whether or not we can solve this problem with regulations. After all, it goes deeper than that. Further, despite the systemic risk that big banks clearly pose, big, consolidated banks with innovative products can also help spur growth. That said, the banks, like any good business, need to be acting in the interest of sustainable profits and not in the interest of short-term revenue growth.  [more]

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6

Macau: Don't Call It a Comeback

September 22, 2009 – Comments (0) | RELATED TICKERS: MPEL , WYNN , LVS

With Wynn's Macau spin-off looking like it's going to fetch a nice price in Hong Kong, the publication of formal regulations that VIP commissions to junkets cannot exceed 1.25% (benefits MPEL, LVS, and others), and the surreptitious lifting by the PRC government of visa restrictions to Macau, we've seen a huge bump in the values of Macau's casinos.

This has admittedly been a long time coming, but I continue to believe in Macau's long-term story as Asia's premier destination for gambling and -- eventually -- entertainment.  [more]

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8

Free Money!

September 22, 2009 – Comments (0)

There's an old saying that in your greatest strength lies your greatest weakness. And that's true of the Chinese economy. One of the reasons China has been able to post 25 years of 8% to 10% annual GDP growth is because the economy is controlled from Beijing. And yet, as Andrew Peaples reports today in the WSJ, that control means the economy -- at least segments of it -- is delaying an inevitable reckoning. Here's the story:

China's Ministry of Finance on Tuesday extended by 10 years the maturity of a $36.2 billion bond due to China Construction Bank. The bond issued by Cinda Asset Management in 1999, was due Monday.  [more]

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3

Happy 60th Birthday, PRC!

September 21, 2009 – Comments (0)

The celebration begins. Here's to another 60 years of staying true to your founding ideology.

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2

Brazil Hot, Spain Not

September 21, 2009 – Comments (0)

That's my conclusion from news that Santander will be spinning off and selling shares of its Brazilian unit to finance rapid expected growth in that country. Full story here.

But don't fret Spain, you still have better ham.

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5

We Have a Veto!

September 21, 2009 – Comments (0)

Chinese regulators finally told an applicant that "No, you are not qualified to list on the Growth Enterprise Market (GEM)."

So either  Nanjing Paneng Technology Development Co. is the most messed up company ever or they were the unlucky ones to have their name drawn from the "Hey, let's make this look at least a little legitimate...like we're exercising a little discretion" hat.  [more]

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The NYTimes Looks at China in a Vacuum

September 18, 2009 – Comments (6)

We get this: The image of laid-off workers here returning to jobs stands in sharp contrast to the United States, where even as the economy shows signs of improvement, the unemployment rate continues to march toward double digits.   [more]

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5

Beware Los Zetas

September 18, 2009 – Comments (1)

This is sobering:  [more]

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5

Drive the Interoceanic Highway

September 18, 2009 – Comments (1)

NPR has spent the week taking a fascinating look at the new Interoceanic Highway that connects the west coast of Peru with the east coast of Brazil. The highway is probably good for economic development at the end of the day, but construction has been not without its costs. Anyway, the NPR report is worth a listen. You can find it here.   [more]

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3

Here Comes the GEM

September 17, 2009 – Comments (0)

China has apparently approved 7 of 7 companies for listing on their Growth Enterprise Market (GEM), which is designed to list small companies and compete with the Nasdaq. If they're going to be that generous, I wonder what that means for the reverse mergers industry and if that means small Chinese names are going to stop listing here...which would make my job less fun.  [more]

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8

Another CAPS Contest Short

September 17, 2009 – Comments (6) | RELATED TICKERS: FEEDQ

I promised two and I will deliver. And this one may take a few of you by surprise as well since it's current a 5-star CAPS stock with 878 outperform ratings and just 20 underperforms. But here goes anyway...  [more]

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The Freakiest Thing You'll See Todat

September 17, 2009 – Comments (1)

Regis...Kelly...Me. All bobble heads. All super freaky. Our ads may actually start driving customers away...

 

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Short This Stock!

September 17, 2009 – Comments (1) | RELATED TICKERS: CFSG

Hey, Fools. Here’s CAPS Champion of the World Contest Idea #1 for the day, and I think you might find it surprising. Remember that you need to rate at least one of these ideas in order to qualify for our quarterly prizes. If you need to join the contest, do that here. If you’re not signed up, that’s sorta pathetic at this point. But that’s neither here nor there.

Onto the idea!!

Short China Fire & Security (Nasdaq: CSFG)

Thesis
China Fire & Security
(Nasdaq: CFSG) is up nearly 170% year-to-date despite the fact that it’s needed extraordinary margin improvement to meet the market’s Q1 earnings expectations (which the company said was unsustainable on its conference call and then not only sustained, but improved upon in Q2), lost a key contact at China’s Fire Security Bureau (which it did not disclose), and continues to do most of its business in the iron & steel industry in China which, by most accounts, has massive overcapacity. Of course, the stock recently cracked the IBD 100 and its meteoric rise to the top is, probably not coincidentally, accompanied reports from online brokers that day traders are returning to the market at a rapid clip.

All of this is to say that China Fire’s near-term fundamentals, IMO, do not support a 6x EV/Sales multiple or a 15x EV/EBITDA multiple. The stock has got to give something back, and that will cause it to underperform from  here.

Company Description
China Fire, based in Beijing, designs, manufactures, and installs complete fire safety systems for use in industrial buildings throughout China. The company has a significant growth opportunity as the country both retrofits existing facilities and builds new power plants to keep up with current demand. We’ve visited China Fire a few times in China and at Global Gains have recommended people own the stock in the past. But we also recommended folks sell at around $15 per share not too long ago for many of the same reasons outlined above.

Valuation Snapshot
Market Cap: $503mm
Revenue: $77mm
EBITDA: $29mm
Net Income: $27mm
Cash: $28mm
Debt: 0
EV/Sales: 5.6x
EV/EBITDA: 14.9x
P/E: 17.3x
P/TBV: 5.0x

Agree/disagree? Let me know in the comments!  [more]

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Twofer Thursday

September 17, 2009 – Comments (1)

Hey, folks.  [more]

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Zimbabwe Turns Over a New Leaf

September 16, 2009 – Comments (0)

Mugable declares: ""The sanctity of property rights and the rule of law in all its dimensions are fully respected."

Well, now. Don't we all feel better. Good thing, too, because the BRIC will be much hipper when it's the BRICZ.  [more]

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6

CBPO: One From Rodman

September 16, 2009 – Comments (0)

We're wading through all of our notes from the recent Rodman & Renshaw conference in NYC, and while they're available in their entirety only to our Global Gains members, I thought I'd post a few here that I found interesting. Here's one that got my attention for the huge potential delta on its risk/reward profile:  [more]

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5

Common Sense and Good Beer

September 14, 2009 – Comments (4)

Got my hands on the Lagunitas 2009 Correction Ale this weekend. A tasty beverage with a sound perspective. Quoting the label:  [more]

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No CAPS Contest Idea This Week

September 11, 2009 – Comments (0)

We're at the Rodman & Renshaw conference seeing likes of China and natural resource companies, so we're busy collecting, rather than dispersing, intelligence. But we'll make it up to you with two ideas from the conference next week. Enjoy the weekend!

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3

Brazil's Armored Car Army

September 10, 2009 – Comments (2)

Having a pink Beetle is stupid even apart from the fact that it makes you a target.

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Live From Rodman & Renshaw

September 09, 2009 – Comments (0)

Holding court in the China Room (Kennedy I) for any of you who are here. Get real-time tweets (mostly snarky comments about bad presentations) on the Twitter Feed.

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And CNBC has reached a new low...

September 04, 2009 – Comments (3)

Check it (modestly NSFW). Incidentally, this gratuitousness is also why Limited Brands (LTD) gets significant coverage for its earnings and why the Victoria's Secret fashion show is considered a business event by that channel.

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3

Since I Slammed Paul Krugman...

September 04, 2009 – Comments (6)

last week, I'll man up and compliment his lucid, well-written short history of modern economics -- How Did Economists Get It So Wrong? -- in this week's NYT Magazine (hat tip to Otto kid). The first part of that ultimate conclusion, specifically that "[economists] have to face up to the inconvenient reality that financial markets fall far short of perfection, that they are subject to extraordinary delusions and the madness of crowds" is exactly right.  [more]

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Short It!

September 03, 2009 – Comments (2) | RELATED TICKERS: IMAX

A few facts to consider as you sip your mornin' joe:  [more]

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When Swiss Bankers Attack!

September 02, 2009 – Comments (8)

Next of Fox: When Swiss Bankers Attack! Some excerpts:   [more]

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The Importance of Chinese Brands

September 02, 2009 – Comments (1)

We've got James Fallows talking China on this week's Fool podcast, and if you listen to the end, you'll hear him talk about the relative underdevelopment of brands in China. In fact, he asks us to shout out brands we know and (though we could have gone longer) basically cuts us off saying that we don't know a lot of brands in China because there aren't a lot of brands in China. Indeed, AdAge recently corroborated this point with their article "Why a Chinese Multinational Brand is Years Away" (registration required).  [more]

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Slow Clap for eBay

September 01, 2009 – Comments (1) | RELATED TICKERS: EBAY

Buys Skype for $2.5b in September 2005.   [more]

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