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Archive for February, 2009
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VERDICT: No Confidence

by ilene - February 23rd, 2009 1:18 pm

Karl Denninger to the Administration: "We didn’t need terrorists to destroy our nation. We’re doing it to ourselves, and the guilty parties are found within the boundaries of Washington DC."

VERDICT: No Confidence

Courtesy of Karl Denninger at The Market Ticker 

A picture is worth 1,000 words.

If you’re an investor (or soon-to-be-retiree) with a 401k or IRA, here’s what the market thinks about the Obama Administrations’ latest missives on banks and how they intend to deal with the banking system mess:

 

The market calls all bluffs.  In this case it took less than 24 hours.

How many times do we need to see this – Bear Stearns, Fannie and Freddie, AIG, Lehman and now every publicly-traded bank in America – before the government stops this crap, formulates a plan and comes out with a clear statement on exactly what they intend to do, then shuts up and does it?

Will it be before or after the banks all crash to fifty cents a share, triggering international bank runs and forcing immediate FDIC intervention, which by the way the FDIC cannot support without explicit Congressional backstop as the FDIC has some $35 billion in cash but there are several trillion residing in insured deposits!

(How’s that for leverage - some 100:1?)

Consolidating the banking system’s debt on the government’s balance sheet, which this would cause de-facto if not in name, would more than double the national debt overnight.

This in turn would cause an instantaneous sovereign debt downgrade and spike interest rates.

Into a $1.5 trillion deficit and over $100 billion of supply being pushed out on a monthly basis by the government this in turn would result in the inability to cover the coupon and threaten a sovereign default.

Wake up Washington DC – your usual game-playing routine has run out of time and ability to cover.  You have lied too often and sat back while the "capitains of Wall Street" have done so as well, costing investors trillions in losses as a direct and proximate consequence of the lies for which they cannot recover.

Either stop it – right now – or America as a nation is threatened with the imminent failure of both its banking system and political structure.

We didn’t need terrorists to destroy our nation.

We’re doing it to ourselves, and the guilty parties are found within the boundaries of Washington DC.

 



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Some Good News Lost In All The Doom And Gloom

by ilene - February 23rd, 2009 12:17 pm

Rare Finding! The world’s not coming to an end (but life as we know it may be). 

Some Good News Lost In All The Doom And Gloomfrom institutionaladvisors.com

Courtesy of Eric J. Fox, at the Stock Market Prognosticator.

The sentiment is obviously terrible out there for the the market and the economy, so it is important to highlight some data that didn’t get that much play because most pundits are too busy predicting when the sky will fall and who it will fall on.

The Conference Board reported that its Index of Leading Economic Indicators rose 0.4% in January. This is the second month in a row that it increased. Five of the ten components in the index were up.

And no…I am not saying everything is great in the economy, but the world is not coming to an end like the blogosphere seems to be saying. This is not Imperial Rome, and there is not a Barbarian army camped outside our walls waiting to sack us.

Capitalism is cyclical. Get used to it.

 



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Banking on the Brink

by ilene - February 23rd, 2009 11:27 am

Paul Krugman argues for fairness. The “public-private partnership” to buy troubled assets from the banks is a losing deal for taxpayers and a giveaway to shareholders. Taxpayers shouldn’t support worthless banks for the benefit of the shareholders and management. – Ilene

Paul Krugman: Banking on the Brink

Courtesy of Mark Thoma at Economist’s View

It’s time to subject large banks to a serious stress test, and then nationalize any bank that is deemed insolvent:

Banking on the Brink, by Paul Krugman, Commentary, NY Times: Comrade Greenspan wants us to seize the economy’s commanding heights. O.K., not exactly. What Alan Greenspan,… a staunch defender of free markets … actually said was, “It may be necessary to temporarily nationalize some banks in order to facilitate a swift and orderly restructuring.” I agree.

The case for nationalization rests on three observations.

First, some major banks are dangerously close to the edge — in fact, they would have failed already if investors didn’t expect the government to rescue them if necessary.

Second, banks must be rescued. The collapse of Lehman Brothers almost destroyed the world financial system, and we can’t risk letting much bigger institutions like Citigroup or Bank of America implode.

Third, while banks must be rescued, the U.S. government can’t afford, fiscally or politically, to bestow huge gifts on bank shareholders.

Let’s be concrete here. There’s a reasonable chance … that Citi and BofA, together, will lose hundreds of billions over the next few years. And their capital … isn’t remotely large enough to cover those potential losses.

Arguably, the only reason they haven’t already failed is that the government is … implicitly guaranteeing their obligations. But they’re zombie banks, unable to supply the credit the economy needs.

To end their zombiehood the banks need more capital. But they can’t raise more capital from private investors. So the government has to supply the necessary funds.

But … to bring these banks fully back to life would greatly exceed what they’re currently worth. … And if it’s basically putting up all the money, the government should get ownership in return.

Still, isn’t nationalization un-American? No, it’s as American as apple pie.

Lately the Federal Deposit Insurance Corporation has been seizing banks it deems insolvent at the rate of about two a week. When the F.D.I.C. seizes a bank, it takes over the bank’s bad assets, pays off some

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Just Another Manic Monday

by Phil - February 23rd, 2009 8:00 am

Wow we had a busy weekend!

I wrote about 6 pages of comments this weekend, doing an overview of the economic situation at the end of Friday’s post (we decided we like F at $1.58) and in the comments of the Weekend Wrap-Up, there is a books worth of strategy advice as we look at Edro’s virtual portfolio along with new plays on OSX and DRYS.  I would have to call this mandatory reading for members!  The discussion centers around our "buy/write" strategy outlined in "How to Buy Stocks for a 15-20% Discount" and the most important point I made was:

Keep that in mind when you are successful in the position.  You are NOT locked into the amount of shares you have.  If you are not comfortable with an assignment number, you can always cut your entry back by half or more so the assignment only has the net effect of putting you back to the same amount of shares at a lower basis.  Obviously, again, again, again I say – If you don’t WANT to own the stock – you shouldn’t be doing this in the first place!  If you want to gamble on YRCW going up but have no intention of owning them, you can take net .60 and buy the Jan $2.50 callls and sell the Jan $5 calls, which makes a 300% profit if called away so rather than risk $4,100 on this position hoping for a double, you can buy 20 of the bull call spreads for $1,200 and make a $3,800 profit if called away and use the other $2,900 to diversify the risk as well as take some downside plays to smoothe out the virtual portfolio volatility.

This is what we teach at PSW – There is ALWAYS an option – No matter what the strategy, no matter what the time frame - you just need to learn to look at the possibilities.  If someone is buying 1,000 YRCW with a 20% stop at $4 hoping to make a 25% profit when they hit $5, why not just buy 10 Jan $2.50 calls for $1.40 and sell 10 Jan $5 calls for 0.80, which costs net $600, rather than $4,000 and returns $2,500 at $5, a $1,900 profit on $600 rather than $1,000 on $4,000 and you CAN’T POSSIBLY LOSE MORE THAN $600.  This is what people do not understand…
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Citigroup Begs To Be 40% Nationalized

by ilene - February 22nd, 2009 11:56 pm

Update on Citigroup, courtesy of Mish.

Citigroup Begs To Be 40% Nationalized

Citigroup is in deep trouble. Its share price is $1.95 and the market is recognizing what I said a year ago: "Citigroup Is Insolvent". Of course it is not just Citigroup that is insolvent, the entire global banking system is insolvent.

Nonetheless, Citigroup pretends otherwise.

Inquiring minds are reading Citi presses officials to take 40% stake. 

Citigroup is pressing the US government to agree on a new capital injection that would increase the authorities’ stake in the troubled bank to about 40 per cent but stop short of an outright nationalisation.

People close to the situation said Citi executives had been in discussions with regulators during at the weekend over a plan that would enable the government and other shareholders to convert up to $75bn of preferred shares into common stock.

According to its proponents, the injection of common stock would bolster Citi’s capital base while at the same time allaying market fears of a nationalisation. Under the plan, first revealed by the Financial Times last week, Citi could also try to raise fresh equity with a public share offering. The aim would be to keep the government stake to no more than 40 per cent or at least below 50 per cent, said people familiar with the plan.

People familiar with the plan said it would hinge on the price at which the government and other shareholders, which include sovereign wealth funds and Prince Al Waleed, convert their shares as well as how many of its $45bn-worth of shares the government converts.

Top Government Officials – who are trying to establish seeking a want a more strategic and less ad hoc response to the crisis – were and are anxious to avoid if possible the type of Sunday night crisis announcement that became a staple for Hank Paulson for ’s crisis management at the Treasury last year.

Black HoleThe Treasury said secretary Tim Geithner would “preserve a financial system that is owned and managed by the private sector”.

Citigroup Is A Black Hole

Citigroup is a black hole, sucking in every dollar thrown at it and it still wants more. No amount seems enough to save it. Taxpayers have already guaranteed a whopping $300 billion dollars worth of Citigroup debt. Now, two months later, Citigroup is begging for still

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China Invests in Production and Commodities While the US Feeds the Sharks

by ilene - February 22nd, 2009 11:21 pm

More from Jesse’s Café Américain on China’s strategic investments in supplies of commodities.

China Invests in Production and Commodities While the US Feeds the SharksShark Feeding

Courtesy of Jesse’s Café Américain

China is securing long term supplies of oil, aluminum, iron and other hard commodities at ‘favorable prices for years to come.’

The United States is investing in increasingly worthless paper, insolvent banks, crony capitalist ponzi schemes, non-productive consumption, and enormous bonuses for Wall Street financiers.

After a visit to China a few years ago, touring their factories with workers quietly hunched over their worktables in fear, working whatever hours were offered in difficult conditions, Bill Gates observed that this was ‘his kind of capitalism.’

The choices you make, what you choose to do or not to do, will pay significant returns, either good or ill, for your children and your children’s children.

Plus ça change, plus c’est la même chose.Aluminum Corp of China (Chinalco) The investment by Aluminum Corp. of China, or Chinalco as the state-owned entity is known, into Rio may bolster China’s bargaining power to set iron ore prices, China Iron and Steel Association said.

NY Times
With Cash to Spend, China Starts Investing Globally
By David Barboza
February 21, 2009

SHANGHAI — With the world suffering through a tight credit market, China has suddenly gone shopping.

Beijing said on Friday that one of its big state-owned banks, the China Development Bank, agreed to lend the Brazilian oil giant Petrobras $10 billion in exchange for sending China a long-term supply of oil.

That investment came after similar deals were signed this week with Russia and Venezuela, bringing China’s total oil investments this month to $41 billion.

China’s biggest aluminum producer also agreed earlier this month to invest $19.5 billion in Australia’s Rio Tinto, one of the world’s biggest mining companies. And last Monday, the China Minmetals Corporation bid $1.7 billion to acquire Australia’s OZ Minerals, a huge zinc mining company…China National Petroleum Corporation (CNPC), the country's top oil and gas producer

China wants reliable supplies of crude oil, to fuel its growing transport sector; it needs iron ore for steel production, and copper and aluminum to build homes and consumer goods…

Analysts say China could continue to make deals for a variety of small oil and gas companies, mineral producers and mining firms.

This week, for instance, shares of

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Taxpayers To Get Raped

by ilene - February 22nd, 2009 10:14 pm

The process in the works? Mish presents two sides – language and meaning.

Taxpayers To Get Raped In Public-Private "Partnership"Lehman_Brothers_Times_Square_by_David_Shankbone

Courtesy of Mish

CNBC is discussing Crafting a Bank Plan…No ‘Lehman Weekends’
 

While markets appear to be waiting for the hammer of government to come crashing down on the nation’s two largest banks, several government officials in interviews with CNBC on Sunday described a process in the works that is far more deliberative.

Some details will be made available this week, but parts of the plan will take weeks, months and even more than a year to play out as the Obama administration puts together a program that they hope will return banks to long-term health.

What is clear is that they are specifically trying to avoid “Lehman Weekends,” referring to the furious efforts in September when Lehman Bros. went bankruptcy and AIG was bailed out. Officials stressed that there were no separate meetings going on surrounding Bank of America or Citigroup specifically and that the two banks would be treated under the broad plan now in the works.

Neither bank has asked for increased government assistance and one official said such assistance is not needed at this time.

Officials would not rule out increased or even outright government ownership of large banks at the end of the process, but they say their intent is to avoid that outcome and that it is anything but certain. They say the government does not want to be running these companies.

If the banks end up in government hands, officials say, the intent would be to get them into private hands quickly and do so in a way that is not much different from how the Federal Deposit Insurance Corp. currently resolves bank insolvencies, which typically take place over the weekend. The extent of government ownership, they say, will depend on the size of the losses at the banks, the access of banks to private capital and how the recession plays out.

Said one high-level official, “I think the market is missing that the whole intent of this process is to show that the banks have enough capital for even worse outcomes than we currently envision and to show there’s a program in place to give banks access to that capital if they need it.”

My Comment: What the nameless high

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The Future Of Wall Street

by ilene - February 22nd, 2009 9:23 pm

Interesting insight via John Carney at ClusterStock.

The Future Of Wall StreetWall-Street-Bull.jpg, clusterstock

Courtesy of John Carney at ClusterStock

Here’s the inside scoop on the current state of brokerages and investment banking, courtesy of one of our readers.  He explains:

  • The firms most aggressively pursuing brokers are foreign banks UBS and Duetche Bank, neither of which is restricted by the compensation caps that come with TARP funds.
  • Morgan Stanley and Citigroup’s brokerage joint ventue will attempt to avoid the TARP compensation caps through corporate structuring. The argument is that the JV didn’t take TARP funds, even though it was capitalized by corporate parents that took TARP. (This was actually our advice on how to avoid the paycaps.)
  • The dominant players in investment banking will be Morgan Stanley, Goldman Sachs and JP Morgan, who will form a kind of new oligopoly. Margins will be lower but leverage will be as well. With so much risk taken out of the game, they may even trade at higher multiples to earnings.

That’s just the summary. Here’s the details:

It amazes me how so many clueless folks can drone on about stuff they know nothing about. The running assumption being that all precedents can be extrapolated to all new situations.

First, those that say with the shit shape the industry is in there’s no place to go, you clearly haven’t a clue. In the retail advisor space, the primary recruiting competition to the MSSB JV is UBS. They have the most aggressive bid in the market for talented brokers with current payments for jumping ship being 200-250% of trailing 12mos gross revenue. Since September, the reality for the average broker, is that each month that passes means his trailing 12 gross is decreasing due to market conditions. Thus, for MSSB, time is of the essence (MS lost dozens of FAs last week with the expiration of the February offers). The second most aggressive bid is Duetche Bank. Note that both are non-US firms and neither is subject to any restrictions, real or populist inspired, due to TARP dealings. Thus, these non-US firms have an unfair advantage in competing for talent if the domestic firms are having their hands tied by Congress, the media or internet no-nothings. Funny, but

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Phil Gramm’s Evisceration

by ilene - February 22nd, 2009 4:24 pm

Karl Denninger responds to Phil Gramm’s "historical revisionism" piece in the WSJ.

Phil GrammPhil Gramm’s Evisceration

Courtesy of Karl Denninger at The Market Ticker

The Wall Street Journal has an interesting opinion piece by none other than Phill Gramm this weekend.  It begins thus:

"The debate about the cause of the current crisis in our financial markets is important because the reforms implemented by Congress will be profoundly affected by what people believe caused the crisis."

Oh good.  You intend to talk about what people believe caused this crisis, instead of what did cause it?

Fantastic Phil.  This is going to be amusing.

I believe that a strong case can be made that the financial crisis stemmed from a confluence of two factors. The first was the unintended consequences of a monetary policy, developed to combat inventory cycle recessions in the last half of the 20th century, that was not well suited to the speculative bubble recession of 2001. The second was the politicization of mortgage lending.

Politicization of mortgage lending?

You mean to tell me that the creation of 2/28, 3/27 and OptionARM loans was the result of politicization of mortgage lending?

Oh boy, this is a good one.

The 2001 recession was brought on when a speculative bubble in the equity market burst, causing investment to collapse.

The speculative bubble in the equity market burst Mr. Gramm because the companies in the Internet space were making knowingly inflated statements about their prospects for growth and in fact factually incorrect statements about demand growth after the first "burst" of adoption of the technology took place. 

This is not conjecture, it is a fact – a fact that I outlined several times leading up to the bust.  It was the reason that I, as CEO of MCSNet, refused to finance any of my equipment, refused to take any debt whatsoever in the operation and expansion of my enterprise and refused to get involved in what I knew for a fact was a game of Russian Roulette – with five bullets.

Nonetheless I was able to operate that company with greater than a 40% pretax operating margin for more than five years,

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A Look At One Of The World’s Largest Fund Of Funds

by ilene - February 22nd, 2009 2:42 pm

You heard it here first (maybe), a fund of funds with no funding is no fun.

A Look At One Of The World’s Largest Fund Of Funds – New York State

Courtesy of Tyler Durden at Zero Hedge

In the wake of the Madoff scandal, it is only a matter of time before the Fund of Funds industry disappears, as investor anger grows at the glaring failure of Fund of Funds’ primary responsibility – due diligence. Fund of Funds are currently perceived as worthless middle men between hedge funds and investors, pocketing 1% management fees and 10% incentive fees for arguably doing no work whatsoever.

So as the investment industry contracts and Fund of Funds do all they can to stay around for a few more quarters, it makes sense to take a look at some entities that few have considered: the state pension and retirement funds. Notable among these are the California Public Employees Retirement System (Calpers), The Teachers Retirement System of Texas (TRS), the Orgeon Public Employees Retirement System and the granddaddy of them all: The New York State Common Retirement System and the New York State Teachers Retirement System.

Which brings us to an interest point. As the financial system collapses and states’ budget deficits skyrocket, the lives of citizens are about to get very ugly as legislators’ only options are to cut state employees (i.e. police officers, healthcare workers and educators) and raise taxes through the roof. One need look no further than California which is on the brink of collapse, as absent federal assistance, it will be unable to fund its $42 billion state deficit. New York is in no better position, and David Paterson has had numerous media appearances attempting to warn New Yorkers just how difficult lives in the state are about to become. New York state public workers rallying in Albany, World Socialist Website

In the meantime, public workers, current and retired, of troubled states will shortly begin receiving very disturbing news, as their pensions and benefit packages are about to be drastically reduced if not eliminated altogether. The culprit? The falling market.

New York State Retirement System

At the market’s peak a little over a year ago, the two principal funds that New York uses to invest retirement money, the New York State Common Retirement System and the New York State Teachers’ Retirement

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Phil's Favorites

Largest Central Banks Now Hold Over 15 Trillion in Fictitious Capital

January 27th, 2012 1:52 pm

Largest Central Banks Now Hold Over 15 Trillion in Fictitious Capital

Courtesy of Russ Winter of Winter Watch at Wall Street Examiner  

I could not help noticing that China’s imports from Japan fell 16.2pc in December. Imports from Taiwan fell 6.2pc.  The strong yen strikes again: Honda decides to build a high-performance hybrid Acura in Ohio – instead of its home nation of Japan. The firm’s continued shift in p...



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All About Trends

Mid-Day Update

January 27th, 2012 1:40 pm

Reminder: David is available to chat with Members, comments are found below each post.




To learn more, sign up for David's free newsletter and receive the free report from All About Trends - "How To Outperform 90% Of Wall Street With Just $500 A Week." Tell David PSW sent you. - Ilene...

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Zero Hedge

Debt Ceiling 101, Santelli Sounds Off

January 27th, 2012 12:55 pm

Courtesy of ZeroHedge. View original post here.

Submitted by Tyler Durden.

In an effort to reach the angry mob, CNBC's Rick Santelli goes all Sesame Street on the numbers behind the US Debt Ceiling Rise. Focusing for two minutes on what this practically means for every man, woman, child, and politician, the shouting Chicagoan points out that when the US breaches this new limit then the world's entire population will be on the hook for $2,346 each (and $52,409 per US person).

...

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Chart School

ECRI Recession Call: Growth Index Contraction Eases Further

January 27th, 2012 12:35 pm

Courtesy of Doug Short.

The Weekly Leading Index (WLI) growth indicator of the Economic Cycle Research Institute (ECRI) posted -6.5 in its latest reading, data through January 20. The latest public data point is a reduced contraction from last week's -7.6 (a slight downward revision from -7.5). This is the highest level (i.e., least negative) since early September. However, the underlying WLI declined fractionally from an adjusted 123.3 to 122.8 (see the third chart below).

Early last December Lakshman Achuthan, the Co-founder of ECRI, spoke with Tom Keene on Bloomberg Television's Surveillance Midday. You can watch the video on the ECRI website here, with bold heading Recession Update. The eight-minute video is well worth watching in its...



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Market Montage

Average Age of U.S. Vehicles Hits Record 10.8 Years

January 27th, 2012 11:15 am

Submitted by Mark Hanna

Courtesy of MarketMontage. View original post here.

Some combination of better made cars, and less Americans able to pay new car prices has conspired to push up the average age of U.S. vehicles to a new record high.  Reflecting this sea change, one of the best investment g...



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Insider Scoop

Research in Motion Surging after Prem Watsa Stake

January 27th, 2012 10:05 am

Courtesy of Benzinga.

Shares of battered tech company Research in Motion (NASDAQ: RIMM) are seeing much strength during Friday's trading session.

Fairfax Financial Holdings released a 13G filing with the SEC this morning, in which they disclosed a 5.12% stake in Research in Motion.

Currently, shares of Research in motion are up over 4% at $16.85. Over the last year, Research in Motion is down over 72%.

Research In Motion Limited is a designer, manufacturer and marketer of wireless solutions for the worldwide mobile communications market. RIM provides platforms and solutions for access to information, including e-mail, voice, instant messaging, short message service.

...

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Sabrient

Sabrient Risers - 1/27/2012

January 27th, 2012 12:00 am

Top 5 RisersStockRatingAnalysisASBCBUYMany analysts are expecting higher than previously expected long term growth from Associated Bancorp, and its near-term earnings outlook is also improving.CZZSTRONGBUYThe recent earnings history for Cosan Ltd shows significant improvement while projected valuation continues to rise.STLDBUYProjected value continues to rise for Steel Dynamics while long term increases in earnings growth are also becoming more widely expected.PSESTRONGBUYAn increasingly attractive expected long term growth rate and a significantly higher projected valuation from just a fe...

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ETF Selector

Wall Street Party Hangover (SPY, DIA, QQQ, IWM, GLD)

January 26th, 2012 6:16 pm

Courtesy of John Nyaradi.

Major markets and major index ETFs corrected slightly today after the stock market’s euphoric party yesterday

Major markets suffered a slight hangover today, as the S&P 500 dropped .57%, the Dow Jones Industrial Average dropped .18%, the NASDAQ dropped .46% and the Russell 2000 Index dropped .34%, after yesterday’s crazy Fed and Tech Sector induced Wall Street Party.  The NASDAQ, in particular, partied very hard, so hard in fact that the NASDAQ reached its 11 year record high.

The major market index ETFs were hungover too as the SPDR S&P 500 ETF lowered .51%, the SPDR Dow Jones Industrial ...



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Option Review

Big Prints In Deutsche Bank Put Options

January 26th, 2012 1:38 pm

 

Today’s tickers: DB, ATHN & LSI

...



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OpTrader

Swing trading portfolio - week of January 23rd, 2012

January 23rd, 2012 8:56 am

Reminder: OpTrader is available to chat with Members, comments are found below each post.

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here

Optrader 

...

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IRA Strategy/Income Trader

Weekend Virtual Portfolio Update 1/22/2012

January 22nd, 2012 10:09 pm

Here is the virtual portfolio weekend update. Basically a recap of the positions and some notes about the trades. As usual, I'll post the previous week's P&L for comparison. Not the greatest of week in general! AA Money Only transaction last week as we bought back the AA Feb 9 puts on Tuesday for close to a 70% profit. The idea is to sell another set of put as soon as we get a chance. Previous week P&L - $400.00 We lost some ground this week, but we'll keep on selling premium! FAS Money We also lost some ground in this virtual portfolio, but we have sold plenty of premium for the coming week. A little correction would go a long way to help! On Wednesday we sold the FAS Feb 72 puts (already good for 50%), on Thursday we added the Jan4 78 calls and on Friday we had to roll the Jan 78 puts to the Jan 80 puts. We were hoping for these ones to expire worthless on Friday, but a late stick killed that hope. Previous week P&L - $4372.00...

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Stock World Weekly

Stock World Weekly: QE-cating

January 22nd, 2012 2:52 am

NEW: Elliott and Ilene are available to chat with Members regarding topics presented in SWW, comments are found below each post.

Here's the latest Stock World Weekly. We discuss the Fed's next move, and it's new policy for more QE-cating.  Brief review of Sabrient's trade ideas for 2012 (already doing well) and a few new buy-writes from Phil and Pharmboy. Enjoy! (Feedback appreciated - give some life to the comment section below.)

Click this link for this weekend's newsletter, and sign in or sign up.

...

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Pharmboy

Biotech Investing for 2012

January 18th, 2012 1:09 am

Reminder: Pharmboy is available to chat with Members, comments are found below each post.

Finding new and exciting Biotech companies that target novel mechanisms is like trying to find a needle in a haystack.  Sure there are many companies working on cutting edge science, but investing in those companies to reap the rewards of their work is a very dangerous game.  More often than not, companies fail because the mechanism does not pan out, the compound(s) do not have pharmacokinetics (get into the body or last very long in the body), or an adverse event happens that knocks years off a development timeline.  In addition, the stock can be manipulated by market makers so investors don't know which way is up.  I approach investing in biotechs as a long term prospect.  I continue to like our current portfolio of biotech companies (join in chat for many of those plays), and we continually add/subtract shares and sell/buy options on ...



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