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July 2012

Recs

2

Reginald's Rubber Route

July 31, 2012 – Comments (0) | RELATED TICKERS: SWM , GRA , GT

I said last week..."the economy sux, employment is almost non-existent, and the expansion of credit, the driving force required to get the economy moving again, simply cannot happen.". I had no idea that I would be called the things I was called. Hell I had no idea those were real words!  [more]

Recs

3

Charlie Chases Chickens

July 22, 2012 – Comments (0) | RELATED TICKERS: AGU , GRA , MYE

As I have said in this space any number of times, the economy sux, employment creation is almost non-existent, and the expansion of credit, the driving force required to get the economy moving again, simply cannot happen.  [more]

Recs

1

Mark Buys a Boat

July 15, 2012 – Comments (0) | RELATED TICKERS: PAY , ARCB , IRF

Investors continue to focus on bank profits, all the while deploring the graft and corruption that has become the American financial system.  [more]

Recs

3

Wendy Moves to Akron

July 07, 2012 – Comments (3) | RELATED TICKERS: USG , WOR , MGI

It has always amazed me, the things that make the markets move in one direction or another.

Friday it was all about employment, or more specifically, jobs creation, with a website full of analysts of one type or another predicting that 100,000 jobs would be created during June. When the June jobs creation number was announced on Friday as 80,000 jobs, the markets squatted and began the evacuation process, and didn't wipe until the closing bell.

Portfolio Commentary
The Wax Ink Portfolio was up 1.0% for the week, with an average share price of $24.15.

By comparison, the Dow was down 0.8%, the Nasdaq was up 0.1%, the S&P 500 was down 0.5%, and the Russell 2000 was up 1.1%.

Year to date, the Wax Ink Portfolio is up 2.8%, while the Dow is up 4.5%, the Nasdaq is up 12.8%, the S&P 500 is up 7.7% and the Russell 2000 is up 8.9%.

Market Commentary
The markets received a little help during the week thanx to some of the world's banks, with China's central bank lowering its benchmark interest rate by 1%, along with the a 0.75& lowering by the European Central Bank and an increase in debt repurchasing by the Bank of England.

One of the ironies in all of this was an announcement by the Japanese finance minister that if the government doesn't get off of the dime pretty damn quick and pass some legislation, the government will be out of money by October. The irony is that Japan's central bank has had interest rates set at 0% for years and now the country is running out of money.

Being the simpleton that I am, even I was able to figure out two things. The first was that if you loan money out for free, eventually you will run out of money, since there are no interest payments to offset the time required to replenish the capital that was loaned out.

The second thing I was able to figure out was that if Japan's reason for lowering interest rates to 0% was to stimulate the economy by making investments in government debt far less attractive than other investments...then they need a new reason.

The other item of note during the week, aside from the lunacy that has become Wall Street, was the employment picture.

Job growth in America is almost non-existent, the "official" unemployment rate remains at 8.2%, demand for goods and services around the world has slowed, central banks in both Asia and Europe have lowered benchmark interest rates, American companies have continued to hint that the business climate is poor at best and that going forward earnings will be lackluster.

Yet with all of this empirical data staring investors in the face, they continue to follow the "Buy" recommendations of Wall Street analysts instead of doing their own equity research and taking part in their financial future.

Incredible!

Equity Commentary
The Wax Ink Portfolio benefited a bit thanx to several merger announcements made early in the week by companies that are not in the portfolio and most likely would never be in the portfolio, since the stock prices are much higher than our valuation estimates.

The one saving grace, at least in our opinion, is that the acquiring companies are overpaying for the companies being acquired.

Moving up the investment mountain during the week were building materials company USG Corporation (NYSE: USG) up 8%, custom processed steel company Worthington Industries, (NYSE: WOR), up 7%, and payday lender Moneygram International, Inc. (NYSE: MGI), up 6%.

Stocks heading into the porcelain hopper during the week were tire maker Goodyear Tire and Rubber Company (NYSE: GT), down 6%, semiconductor manufacturer International Rectifier Corporation (NYSE: IRF), down 5%, and conglomerate GE Corporation (NYSE: GE), down 4%.

Political Commentary
Well it was back to politics as usual during the week, with one political liar doing their dead level best to out lie the other political liar. Sort of reminded me of bankers testifying before Congress.

With that said, I will give Governor Christie props for asking the single most profound question of this political season, at least so far.

I can only imagine what it would be like if Governor Christie were elected President? Especially if he were to have someone as soft spoken as Ted Nugent as his Vice-President.

Regardless of what your politics are, you have to admit that both of those cats are at least...refreshing.

Wax  [more]

Recs

3

Lilly Goes to Lincoln

July 01, 2012 – Comments (0) | RELATED TICKERS: WOR , DCO , CBST

It seems that all of the Eurozone banking folks got together and figured out a way for Spain's banks to be directly recapitalized using bailout money, and that the recapitalization will not add to the country's sovereign debt.

In other words, Spain's banks get money for nothing and their citizens get screwed for free!

It was this news, this knowing, that sent the markets into the throws of orgasmic abandonment of Friday. Couple this event with the news of a potential 120 billion euros that would be used to boost the lending capacity of the European Investment Bank, and it was indeed as orgiastic an event for traders and investors as has occurred in many a moon.

Portfolio Commentary
The Wax Ink portfolio was up 3.6% for the week, with an average share price of $23.91.

By comparison, the Dow was up 1.9%, the Nasdaq was up 1.5%, the S&P 500 was up 2.0%, and the Russell 2000 was up 3.0%.

Year to date, the Wax Ink Portfolio is up 1.7%, while the Dow is up 5.4%, the Nasdaq is up 12.7%, the S&P 500 is up 8.3% and the Russell 2000 is up 7.8%.

Market Commentary
The market focus this week was once again on the Euro and the Spanish debt crisis. Once the news was out that for the next 87 seconds or so, 87 seconds being the attention span of a Wall Street investor, Spain's debt was going to be increased domestically, happy days were here and traders seemed to care about little else.

While good for commodity traders, the dollar weakened during the week, meaning oil prices increased since oil is traded in dollars. Again, while good for traders, this will mean higher pump prices for consumers. As you would expect, with the orgy in full swing thanks to Spain's debt news, few seemed to notice this upward move in oil prices.

The other event that happened during the week was the revision of the May Consumer Sentiment Index from 74.1 downward to 73.2. All of the wizards that live in Oz had all expected the index to remain unchanged.

One other tidbit that happened on Friday was the rebalancing of portfolios for the end of the quarter reports to shareholders. It seems that portfolio managers can invest client's money in absolute garbage for most of the quarter, but as long as the quarter ends with the portfolios holding stocks mother would be proud of, investors are happy.

Once again few investors seemed to notice this news, and even fewer seemed to pay any attention to it.

I guess the greater question is why should investors really care about such global events, especially when it comes to their retirement savings?

Now that Google has invented Porn Glasses investors will be able to watch themselves get screwed anytime they want to!

Equity Commentary
The Wax Ink Portfolio benefited nicely from the news about Spain, with airplane repair company AAR Corporation (NYSE: AIR), up 12%, building materials maker USG Corporation (NYSE: USG) up 16%, custom processed steel company Worthington Industries, (NYSE: WOR), up 18%, and aerospace communications and computer company Ducommun, Inc. (NYSE: DCO) up 24%.

Certainly all was not in complete harmony with payday lender Moneygram International, Inc. (NYSE: MGI), down 7%, and drug maker Cubist Pharmaceuticals, Inc. (NYSE: CBST), down 5%.

Political Commentary
It was a very sad political week this past week, at least for me, learning that the government now has removed my basic right to decide for myself, thanks to the Supreme Court's decision on Obamacare.

I also found it interesting that the with the Supreme's decision, the government now has the right to further invade my privacy by determining if I really do have health insurance.

My god!! There really are no true Patriots left in America today.

Wax  [more]

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