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dpdoor (42.77)

For my short friends

Recs

4

May 17, 2010 – Comments (13) | RELATED TICKERS: HMC , F , TM

Although I am short the market, I am planning on covering before May reports come out. I have notice a substantial increase in activity in discretionary spending.

Besides our remodeling business seeing more activity, I am seeing more new cars on the road.  I have a formula of how many new cars (with paper plates) should be on the road compared to old cars. I am in Southern California were we do replace cars a little more then the average.  According to my math it should be 1 in 43 if cars are replaced every 5 years and the paper plates stay on the car for 6 weeks. 1 in 33 if in cars are replaced every 4 years. Take into account most of the cars I see are active working people and so the true average may be different but a lot of those cars are not being driven while I am on the road.

For the first time, since cash for clunkers, we are in the 1 per 33 range.

Altholug this is not scientific it is still a lot of new cars out there. It could be that the state is so broke they are not sending out the licence plates as fast as usual, and that is why there are so many paper dealer plates??

Never the less I don’t want to be short the market when May’s reports come out.

Also: I am seeing a lot of Hondas; mabey ford turcks and suv's are off (although they have some cool cars now), and we all know about Toyota.

13 Comments – Post Your Own

#1) On May 17, 2010 at 10:56 PM, baschoen (33.46) wrote:

Hyundai and Honda are both doing great.... only problem is they are foreign companies.

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#2) On May 17, 2010 at 11:11 PM, davejh23 (< 20) wrote:

I've also noticed an increase in new cars on the road.  We actually just purchased a new car last week...not because we wanted to...our Ford died with only 110K miles on it...I'll never buy another Ford. 

I've also noticed that many small businesses in my area are having "yardsales" every weekend.  I don't know if this is normal for your area, but I've never seen anything like this in past years.  Some large public companies may be turning the corner, but it sure looks like small businesses are still failing in large numbers.  I don't know if this will show up in gov't reported numbers, but I wouldn't be suprised to see sharp increases in unemployment still.

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#3) On May 17, 2010 at 11:25 PM, dpdoor (42.77) wrote:

Thanks for the info, it all helps

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#4) On May 18, 2010 at 12:07 AM, goalie37 (96.96) wrote:

From the hours I spend watching the various markets, the recovery seems to be doing quite well.  What has happened (in my opinion) is that the stock market is going through a normal and healthy correction, but the nearsightedness of the media is telling us we are in a collapse.

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#5) On May 18, 2010 at 2:38 AM, SnapDave (68.15) wrote:

The markets are way ahead of the alleged recovery. European problems boiling up. Credit is tightening a great deal over there - keep in mind the European economy as a whole is as big as US. China is putting some breaks on right now. In the US, most of the QE has ended, home buyers credit ending, the monkeys in congress are moving with financial reform and there may be a lull in stimulus money actually being spent. That's why it's bad to be long right now. You'll be safe covering shorts in May - I'm not. But don't be quick to go long.

As for the 'recovery' this is government induced. The global financial crisis should have rebalanced, reset and restructured the US and world economy. Instead everyone is in denial and governments stimulated and printed to reflate the same unsustainable structure. That is why we are doomed within the next 5 years. Have a nice day.

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#6) On May 20, 2010 at 11:33 PM, dpdoor (42.77) wrote:

I agree the market was way ahead of the economey, be carefull on the next run up.  I feel the market is only worth 8500 and add 10% to 15% for growth. The market had it at 30%

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#7) On June 02, 2010 at 4:38 PM, dpdoor (42.77) wrote:

I said May 2nd we would get good car reports, I even said Obama would wait with his pep talks till this week and he did. The market was too high it had to come down. Now we can rally for a while.

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#8) On June 02, 2010 at 10:39 PM, dpdoor (42.77) wrote:

Thursday Friday May 3 and 4 2010

April was bad and small business owners that were holding onto employees waiting for a recovery gave up. They probably layed off long time employees. The publicly traded companies that recived bail out money hired people. There are more small business then large. Unemployment numbers may be disappointing.

Auto sales are kicking rump. Those who were short the car companies will have to cover on Thursday. Any down tick will spur short covering and buying. So maybe up to .75% down some time tomorrow followed by up 1.25% then a sell off on Friday of some sort. But overall the market should move up to 10400 to 10700

 

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#9) On June 03, 2010 at 2:02 AM, dpdoor (42.77) wrote:

China Exposure

 

What ran the market up in 2007 was China’s growth. That and the fact real estate was no longer a good investment and we had to put our money somewhere.

China is still helping our companies expand. China grew during our boom time. Then they prospered form internal spending. With out the boom time money they will not grow as fast as we may expect.

We are spending more in the last several weeks but China will not reap the benefits for some time. Also we will never spend like we did a few years ago.

We are rallying right now but by time we hit 10700 we will be hearing about how China is not going to bail us out, that is, they won’t make up for the 30% reduction in discretionary spending. The companies we are buying stock in that depend on China may drop. I hope Ford and a few other companies will do well on U.S. sales and do not get hurt when the market sells off.  

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#10) On June 03, 2010 at 1:13 PM, dpdoor (42.77) wrote:

last night  I said the market would go up 1.25% which would be 10376; it went to 10315; thats pretty close. I said it would have a drop during the day of up to .75% it droped .66%; also pretty close. I said the unemplyment may not be as good as we expect because of the after effects of the bad April, Unenplyment was not as good as we expected.

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#11) On June 03, 2010 at 6:06 PM, dpdoor (42.77) wrote:

June 3 2010

Today’s run up hit my target and the run down hit my target; but they were backwards. The run up came before the run down. Since it finished only slightly up instead of 1.25% up and since it is the third up day after a brutal month, and since we have good news about the discretionary spending and the president  is finally  out again with peep talks I'd say at least Ford should see gains tomorrow. The privet sector unemployment report today was not as good as people expected but it was still better then before. The government added a lot of jobs last month for the census and it's report comes out tomorrow. Like cash for clunkers made a good report for car sells and the market rallied this report will still look good on paper. In conclusion I think since we only finished up 5 points today and Ford gained 1% we will do ok tomorrow.

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#12) On June 04, 2010 at 1:53 AM, dpdoor (42.77) wrote:

Looking for ford at a bargain of 11.74. (buy); It is worth 12.5 (sell) now and more later but that doesn't matter, there is worry about a slump after this rally. 11.90 (hold) is an ok price.

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#13) On June 04, 2010 at 8:24 AM, dpdoor (42.77) wrote:

June 4 2010, Got Ford at 11.74 pre market. One of first trades when pre market opened. Lowest price was 11.72 but that price and mine only lasted less a few seconds. Mine executed at 8:00:08 est. ; just 8 seconds into the pre market.

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