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January 2014



John Mauldin's Forecast 2014: The CAPEs of Hope

January 27, 2014 – Comments (0)

I need to start with my bias for a downturn in the stock market.  I'm not interested in putting much if any money at risk at today's valuations. Mauldin is also a believer in this theme.  One of his first points is that the CAPE is at the point where markets have historically had major corrections.  A big correction doesn't have to happen to make investments in the market today a bad idea.  A long sideways move with the large potential for loss keeps me on the side lines.   [more]



01 27 14 Thoughts - Clean Energy Fuels

January 27, 2014 – Comments (0) | RELATED TICKERS: CLNE

I'm currently reading TBoone Pickens book the first Billion is the hardest.  I think that's what's gotten me interested in CLNE.  I know I'm taken with the natural gas boom we're having.  I see it changing the way we do things going forward.  I definitely see natural gas overtaking coal for power plants, but the question is how far can it go.  It seems reasonable that natural gas will continue to gain on gasonline when you see comapnies like UPS and others using natural gas it gives me more conviction on the issue.  Why in the future couldn't engines be able to switch from gasonine to gas depending on the price?  [more]



01 26 14 Thoughts - Shorting

January 26, 2014 – Comments (3) | RELATED TICKERS: CMG , JCP , RSHCQ

I can't stop thinking about shorting stocks.  For one, I believe the market is overvalued so if you short now, you have a tail wind with you.  That said, not may in the motley fool recommend shorting.  There are a lot of risks to shorting.  Your losses aren't capped like in going long.  The most you can lose in going long is your initial investment.  If the short triples, you lose much more than your initial investment.  I think of Akman and his herbal life short, Greenlight Capital's David Einhorn shorting Chipotle, and even me thinking of shorting Best Buy.  I don't know much about herbal life, but I do know that Chipotle has a possibility of going up several fold, so betting against it is much more dangerous than say betting against JC Penny's.  Chipoltle has the possibility (is going to) of opening a ton of new stores, but in addition has the Chop House, and new Pizza concepts that could bear fruit.  That sounds like a terrible short.  JC Penny's sounds like a good short because it's not only not opening stores but is closing them, it also has the headwind of retail sales going online.  I look at Radio Shack the same way.  Boy would I love to short it.  It has the headwind of retail sales going online and even more so because everything they carry is a commodity.  JC Penny's at least has clothing which a lot of people including myself like to go to a store to try on.  Radio Shack also has a lot of locations in malls that are slowly losing more and more traffic.  I suspect many malls are going to start closing around the country in the coming years.  [more]



1/20/14 - Thoughts

January 20, 2014 – Comments (0) | RELATED TICKERS: BPI

I have written down to think about BridgePoint Education.  Ron Gross mentioned it in one of the motley fools podcasts.  I've read about it before and believe it was/is a selection in one of the services.  Mostly likely MDP since Ron runs that service.  Anyway, Ron saw a catalyst coming for the stock proce to appreciate.  One of the accrediation agencies was going to approve or deny them accreditation.  These are the type of binary events that I believe you can evaluate the probablities and if you keep going with the probabilities the overall result will be favorable.  I hadn't been keeping up with the company and didn't look into it after I made the note.  I looked it up recently and found out that the acccreditation issue got resolved. The old and well still me would have and wanted to (respectively) invest in.  I stayed away because I didn't get back to looking at it and that might have just been because I didn't believe I'd be able to determine the probabities.  Also, I'm fighting with myself over my resolution to buy just inside value recommendations and my belief that the market is overheated.  This is mostly fueled by John Hussmans work.  Both Dusty and I sit in the conundrum.  I wonder if the 2008 crash has affected us too much and made us bias to the downside.   [more]

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