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September 2008

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16

Holy Short Squeeze Batman

September 22, 2008 – Comments (2) | RELATED TICKERS: USO

I took a break from work this afternoon to sneak a peak at what oil was doing and I was blown away.  Obviously, I'm about as bullish on oil as they come and I wrote this morning that I strongly believe that the recent government bailouts are bearish for the U.S. dollar and in turn bullish for commodities like oil (see post: Inflation vs. Deflation).  However, I didn't expect such an rally only hours after I wrote this.   [more]

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24

30 more stocks added to no-short list / Inflation vs. Deflation

September 22, 2008 – Comments (21) | RELATED TICKERS: GE , GM , FMD

This morning, the NYSE added 30 new companies to the no short list. Here's a list of the new additions with a few companies highlighted my myself:

GLG GLG Partners
GE General Electric Co.
OCN Ocwen Financial Corp.
KBW KBW Inc.
GFG Guaranty Financial Group Inc.
MFG Mizuho Financial Group, Inc.
FMR First Mercury Financial Corp.
STC Stewart Information Services Corp.
FCF First Commonwealth Financial Corp.
MTB M&T Bank Corp.
DFS Discover Financial Services
BMO Bank of Montreal
TD Toronto Dominion Bank
CM Canadian Imperial Bank of Commerce
FMD First Marblehead Corp.
BBV Banco Bilbao Vizcaya SA
CIB BanColombia SA
LM Legg Mason, Inc.
NFP National Financial Partners Corp.
AXP American Express Company
CIT CIT Group Inc.
GM General Motors Corp.
HIG The Hartford Financial Services Group
ADS Alliance Data Systems Corp.
ALD Allied Capital Corp.
RAS RAIT Financial Trust
DRL Doral Financial Corp.
FSR Flagstone Reinsurance Holdings
MCO Moody’s Corp.
COF Capital One Financial Corp.

A few comments:

Wow, General Motors was added to the list. Why? I suppose that it has a stake in GMAC, but still.

As a former shareholder who escaped before the company completely imploded (but not without some pain), I find the First Marblehead addition interesting.

Discover and Capitol One are two companies that I have shorted myself in real life over the past year.

Moodys is an absolute joke. The credit ratings agencies have not been punished nearly enough considering the fact that they were rating all sorts of garbage AAA when it clearly was not. They and S&P have been doing a TERRIBLE job over the past several years at assessing risk. The fact that they essentially have a monopoly has prevented these terribly run companies from getting hammered nearly as much as they should have. If my company (which is private) had made as many mistakes as they have over the past several years our clients would freak and we would be forced out of business.

Legg Mason is an absolute mess as well. I don't know what it is, but Bill Miller seems to have lost his mojo. I was questioning his stock picking ability in this sort of environment already, but his disastrous investment in the GSEs sealed the deal for me. Without a cleanup hitter like Miller, Legg Mason is just another investment management company.

I personally own GE and given the enormous size of GE Capital I can see why it was added to the list when so many other banks have been. I'm not saying that the short ban should exist at all, in my opinion it absolutely shouldn't, but since it does they might as well throw GE on there as well.  [more]

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24

The SEC "solves" its screw-up by screwing up again

September 19, 2008 – Comments (11)

Wow what a morning.  There's lots of news out there.  I have been trying to get my hands around what has happened and what it all means.  First I will talk about what a disgrace the SEC is.  I am completely disgusted with Chris Cox and his friends there.  They all should be fired, without packages immediately.
  [more]

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25

How I'm weathering the storm and why I'm not too worried

September 18, 2008 – Comments (18) | RELATED TICKERS: DD , GE , FPL.DL

While the stock market has been absolutely brutal for the past several months, I have managed to stay fairly calm lately for two reasons.  [more]

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17

Dilbert speaks on the economy

September 16, 2008 – Comments (3)

I came across an interesting article written by the cartoonist of Dilbert fame, Scott Adams, this morning:  The piece, called Dilbert guy's economic poll on McCain, Obama, purports to be an unbiased view of which Presidential candidate is best for the U.S. economy.  Adams funded a study of over 500 economists to see which candidate they believe is best for our country's economic future.  This is a very important issue for all Americans, especially those who invest in stocks.  [more]

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11

How much wood would a woodchuck buy if a woodchuck could buy wood?

September 16, 2008 – Comments (7) | RELATED TICKERS: WY

Wow, what a day in the markets yesterday.  I picked the wrong week to stop sniffing model airplane glue.  [more]

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26

The Inside Scoop: Lehman is Cooked

September 14, 2008 – Comments (7) | RELATED TICKERS: LEH , BAC

I just spoke with a friend of mine who works for a bank who is involved in the Lehman
Brothers dicsussion and they said that both Bofa and Barclays are holding out for the government support that JP Morgan got with the Bear deal and as of right now Paulson and friends aren't willing to get involved other than in facilitating the negotiations.  The government opened up this pandora's box by helping out on Bear, Fannie, and Freddy and now they are having a tough time closing it.    [more]

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7

The insude scoop: Lehman is cooked

September 14, 2008 – Comments (0) | RELATED TICKERS: LEH , BAC

I just spoke with a friend of mine who works for a bank who is involved in the Lehman
Brothers dicsussion and they said that both Bofa and Barclays are holding out for the government support that JP Morgan got with the Bear deal and as of right now Paulson and friends aren't willing to get involved other than in facilitating the negotiations.  The government opened up this pandora's box by helping out on Bear, Fannie, and Freddy and now they are having a tough time closing it.    [more]

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19

Feds bailed out China, not the US / You're not going to believe what Countrywide told me and why I locked in a 30-year fixed mortgage yesterday

September 12, 2008 – Comments (11) | RELATED TICKERS: BAC , FNMA , FMCC

Back in April I blogged about how I was considering refinancing my 6%, 10-year ARM mortgage into a 30-year fixed (see post: Time for Deej to refinance...the only question is when?).  Most of those who commented in response to my post said that the days of low mortgage rates are over and that I had missed the boat.  Well, I am pleased to say that yesterday I called my mortgage company, Countrywide, and locked in a zero point, 30-year fixed mortgage at 5.75%...which is lower than the rate that I could have gotten back then.    [more]

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13

I'm about to do a complete 180 on a sector / BURP! Excuse me

September 11, 2008 – Comments (2) | RELATED TICKERS: SAFM , PPC , TSN

Yesterday I talked about how if John McCain is elected president there is a good chance that the government would pull the plug on ethanol subsidities (Obama on the other hand is in bed with ethanol companies, which are major contributors to his campaign).  They are running neck and neck in the polls right now, so it's a coin toss as to who will be elected.  If you are a betting man, or woman, you may want to put your money (or CAPS points) down on meat producers.  [more]

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16

Will new housing regulation effective 10/1 cause builders to drop even further?

September 10, 2008 – Comments (0) | RELATED TICKERS: ITB , IYR

I have come across a couple of interesting articles lately which indicate that loan originators and home builders are pumping as many buyers through the system as possible before a new federal ban on down payment assistance goes into effect on October 1st.    [more]

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11

Ethanol Companies are In BIG Trouble

September 10, 2008 – Comments (5) | RELATED TICKERS: VSE , PEIX

If you own shares in companies that produce ethanol, either in CAPS or in real life (yikes), you should pay very close attention to this post.  If McCain becomes the next president of the United States, these companies are in BIG trouble.    [more]

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13

OPEC decides to curb overall output

September 10, 2008 – Comments (10) | RELATED TICKERS: USO

Man oh man, what a day yesterday.  That one is going to leave a mark.  Oil is now sitting at just above $100/barrel.  This is a level that the world seems to have indicated that it can absorb, and one that I have a feeling OPEC will move swiftly to defend.  While OPEC is essentially powerless to increase production on the upside to fight high prices, it can easily turn off the spigots to protect the price of oil on the down side if it wants to.    [more]

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20

Fascinating domino effect of high gas prices...more bad news for the government

September 06, 2008 – Comments (3)

Everyone knows that the high price of oil and in turn gasoline has caused people to cut back on driving, but I never gave much thought to the implications of this reduction in gas sales on government tax revenue until now.   Check out the following article:   [more]

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8

Is a dollar rebound coming? / When will automakers hit bottom?

September 04, 2008 – Comments (1) | RELATED TICKERS: NSANY.DL

Is a dollar rebound coming?
  [more]

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10

Time to score some cheap drugs, man

September 02, 2008 – Comments (3) | RELATED TICKERS: TEVA

Time to score some cheap drugs, man  [more]

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16

China's Spending May Thwart Olympic Curse

September 02, 2008 – Comments (3) | RELATED TICKERS: FXI

   [more]

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