Over-Correction Overhyped

I am tired of reading articles about how we are not near the low, and how markets tend to over-correct when rebounding from a crash. Almost every article I am reading now talks about the possibility of over-correction, i.e., another 20% drop in the S&P 500.

First, the prevalence of such pessimistic articles is a contrarian signal. Second, Warren Buffett just highlighted that he was buying major U.S. stocks (he's probably adding to his Coca-Cola (KO) and Wells Fargo (WFR) holdings), because he thought they represented reasonable values. And third, almost all the articles base their theory on the 1929 and 1987 crashes. See, for example, this article:

http://www.minyanville.com/articles/spx-charts-TD-technicians/index/a/19550

The above article and ones similar to it fail to distinguish between 1929, 1987, and 2008. In 1929, the government acted too late. Bernanke himself has cited a failure of speedy government intervention as one cause of the Great Depression. In 1987, again, the government arguably did not intervene quickly enough and did not pump into the market substantial taxpayer monies to inspire investor confidence. In addition, the crash of 1987 did not lead to a prolonged bear market--within two years, markets had begun moving substantially higher.

Now, in 2008, not only is the U.S. government inserting between 700 billion and 2 trillion in the markets, but worldwide governments (the G-7) are following suit. Thus, the current situation is completely different from 1929 and 1987. As an attorney, I see briefs all the time where opposing counsel uses one line from an appellate court's opinion that supports his or her client, but fails to mention that the case involved completely different facts, diminishing its applicability. Investors and writers who compare 1929 and 1987 with 2008 are making the same amateurish and unfortunate mistake.

Warren Burger on Self-Restraint

In PAPISH v. BOARD OF CURATORS OF THE UNIVERSITY OF MISSOURI ET AL. (1973), a case about the limits of free speech on campus, Justice Warren Burger dissented. His dissent advocates self-restraint as a core American value:

In theory, at least, a university is not merely an arena for the discussion of ideas by students and faculty; it is also an institution where individuals learn to express themselves in acceptable, civil terms. We provide that environment to the end that students may learn the self-restraint necessary to the functioning of a civilized society and understand the need for those external restraints to which we must all submit if group existence is to be tolerable.

http://www.law.umkc.edu/faculty/projects/ftrials/firstamendment/papish.html

Are You Rich?

Are you rich? It depends on where you live:

http://www.usnews.com/articles/business/your-money/2008/10/09/what-it-takes-to-be-rich--where-you-live.html

The problem is, the numbers represent an average, not a median, which reduces their relevance. On the bright side, there are lots of lovely numbers for stat geeks like myself.

National Geographic on Iran: "Knowledge of self is knowledge of God"

National Geographic has an interesting article on Iran and its past:

http://ngm.nationalgeographic.com/2008/08/iran-archaeology/del-giudice-text

They like to say, for instance, that when invaders came to Iran, the Iranians did not become the invaders; the invaders became Iranians. Their conquerors were said to have "gone Persian," like Alexander [the Great], who, after laying waste to the administrative practices, took a Persian wife to do the same in a mass wedding. Iranians seem particularly proud of their capacity to get along with others by assimilating compatible aspects of the invaders' ways without surrendering their own - a cultural elasticity that is at the heart of their Persian identity.

The author, Marguerite Del Giudice, really did her homework--it's very hard to define words that have no direct translation in English, but she aptly defines the word, "taarof," which means "fighting for the lower hand." To understand this word provides substantial insight into Persian culture. The article also lists the best Persian poets: Rumi, Sa‘id, Omar Khayyám, and Hāfez .

Thanks to Alison Bryan for the tip (August 31, 2008 posting):

http://www.alisonbryan.com/blog/

Bear Markets

© Wall Street Journal

Market Gyrations

I sold off several positions on Tuesday. I wanted to do a stocks update, but I am in the middle of trial prep, so I will offer only my remaining open positions over 2,000 dollars:

EMC
EZU
PFF
SWZ
YHOO

My biggest loser thus far? Yahoo (YHOO). Unfortunately, I continued to average down, and my average buy price is around 18. The lesson? Never catch a falling knife, no matter how cheap the stock seems.

David Brooks on the Stimulus Package

In yesterday’s New York Times, David Brooks says the stimulus plan didn’t work:

It was a failure, because “people spent only 10 percent to 20 percent of the rebate dollars and saved the rest...Martin Feldstein of Harvard calculates the package added 80 billion to the national debt while producing less than 20 billion in consumer spending.”

More evidence the phrase, "We're the government, and we're here to help you," should inspire automatic fear.

NBA Layoffs

You know the economy is bad when the NBA starts laying off people:

http://sports.yahoo.com/nba/news?slug=ap-nba-jobcuts

The NBA, like most other major American businesses, is focusing on international expansion. Maybe Hamed Haddadi can help them out...

Update: Check out this post on Don Nelson and Corey Maggette if you're a Golden State Warriors fan:

http://willworkforjustice.blogspot.com/2008/12/basketball-don-nelson.html

Economy

Great article from Ron Scherer (www.csmonitor.com) about Americans finally shifting their attitudes towards finances:

http://www.csmonitor.com/2008/1010/p01s04-usec.html

Since last October, household net worth has fallen more than $6 trillion...That calculates to roughly $55,000 per household.

This is one time where I am happy to be below the average. Americans, for the first time, are realizing that having too much debt is unwise, which should cause a short-term bump in our savings rate.

Stocks Update: October 13, 2008

The market went up dramatically today, but because it went down 20% last week, most people are still down at least 10% or more.

I made over 600 dollars with my short term Morgan Stanley trade, but it didn't reach the 2000 dollar mark, so the trade is not included below. I had bought only 100 shares at 8 dollars/share last Friday.

I sold my GOOG too early. Had I sold just two hours later than I did, I would have made 2000 dollars, but I dumped as soon as I broke even. As they say, better luck next time.

(I hold EMC and Yahoo in two different accounts, so the percentages below for those two positions are slightly inaccurate.)

Open Positions
CCT = -16.77
EMC = -12.41
EZU = -25.52
GXC = -15.23
MMM = -5.32
SWZ = -22.24
VPL = -22.49
YHOO = -21.52

[Average of "Open Positions": losing/negative average 17.69%]
[141.5 / 8]

Closed Positions:
Held more than seven days but less than one year (from May 30, 2008):
CNB = +10.0
EQ = -8.83
EWM =-11.61 [sold 9/22/08]
EWS = -12.98 [sold 9/22/08]
GE = -6.4
GLD = +8.61 [sold 9/22/08]
IF = -49.00 [sold 10/13/08]
INTC = 0.0 (excluded from average; insignificant movement)
KOL = -10.36
MGM = - 4.17 [10/3/08 - 10/13/08]
PFE = -5.5
PNK = -16.7
PPS = -2.8
VNQ = +2.37 [sold 8/7/08]
WFR = +0.9 (approx; based on partial sales week of 8/4/08 in two separate accounts)
WYE = +2.4

[Overall Record for 7 days+ trades: lost an average of 6.94%]
[-104.07 / 15 trades]

Held less than 7 days:
DUK = 0% (excluded from avg) [8/07/08 - 8/14/08]; GE (1.0%); GOOG (0.8%) [7/28/08 - 7/29/08]; GOOG (5.4) [9/29 - 9/30]; GOOG = 0% (negligible percentage, excluded from avg), [sold on 8/13/08]; GRMN (-6.2%) [Sold 8/5/08]; ICE (2.0%); KOL (13.2%) [9/17/08 to 9/19/08]; MMM (0.5%); MOS (10.4%) [10/6/08 to 10/8/08]; MRK (0.1%); NVDA (8.0%) [8/12 to 8/13/08]; PFE (1.3%), SCUR (15%); SO (-0.3%) [Sold 8/5/08]; STT (2.68%) [10/1/08 to 10/3/08]; STT (0.4%) [10/3/08 to 10/7/08]; TTWO (4.3%) [partial sales on 8/5/08, 8/7/08, and 8/8/08]; TTWO (2.2%) [9/9/08 to 9/12/08]

[Overall Record for ultra short-term 2 to 7 days trades: gained an avg of 3.57%]
[60.78 / 17 trades; as of 10/8/08]

Daytrades:
C = +11.49 (09/01/08)
PFE = +0.5%
GE = +0.5% (Updated on July 14, 2008; bought at 27.15, sold at 27.30)
STT = +0.3
XLF = +4.3% (Updated on July 15, 2008)

[Overall Record for daytrades: Gained an average of 3.35%]
16.79/5

Compare to S&P 500: losing/negative 29.57%
[from May 30, 2008 (1385.67) to late-day October 13, 2008 (975.89)]

The information on this site is provided for discussion purposes only and does not constitute investing recommendations. Under no circumstances does this information represent a recommendation to buy or sell securities or make any kind of an investment. You are responsible for your own due diligence.

Up, Up, and Away?

It's a good day. The Dow and Nasdaq indices are currently up over 6%, but so far, most of my long-term trades are still in the red. I did very well on a Morgan Stanley (MS) trade, but I only had 100 shares. When the dust settles on Friday, I will feel more comfortable about celebrating.

G-7 to the Rescue? Don't Bet on It

The news that the G-7 is meeting is not great news. The G-7 is Canada, France, Germany, Italy, Japan, United Kingdom, and United States of America. With the exception of Canada, Japan, and possibly Germany, none of the other countries' consumers can pull us out of this morass. For example, the average British consumer is more in debt than the American consumer, and even the German consumer is barely keeping his head above water (or did you forget all those formerly East Germans needing jobs?).

We need normally isolationist China and Russia to step in, and it's insulting to them that the G-7 is not already the G-9. WWII is long over, but the financial and political paradigms are all based on a post-WWII world. It's time to grow up and get the players with the most cash reserves and natural resources into the game. This crisis won't be over till China and Russia get officially invited to the club. Personally, I would invite Singapore and make it the G-10. With those three new players, the G-7 can exchange political capital for hard cash. Then, we can show them the advantages of being part of the club. Perhaps then, Russia might feel less inclined to continue to occupy Georgian soil and will avoid establishing a consortium of natural gas producers, which would include Iran.

Bridgewater Report from 2003

Words of doom: "At this point [2003], the U.S. makes up only 30% of the world economy but sucks up 80% of the world's savings."

Here is the link to the whole report (PDF file):

http://www.rapp.org/wp-content/112203-bridgewater.pdf

(copyright belongs to Bridgewater)

HTML version here:

Bridgewater 2003 Report

(copyright belongs to Bridgewater)

Nassim Nicholas Taleb

From Conde Nast's Portfolio.com comes a fantastic interview with Nassim Nicholas Taleb :

http://www.portfolio.com/views/columns/the-world-according-to/2008/08/14/Interview-With-Nassim-Nicholas-Taleb

Here is one excerpt:

The structure of uncertainty in the world is vastly greater than we think. So let's stop playing the narrative fallacy. Take economics, for example. How many economists figured out that when people go to the store to buy products from China, they're raising the price of oil at the pump? How many people thought of that? They raise the price at the pump just by going there.

Interesting fellow, this Mr. Taleb. His book, The Black Swan, received rave reviews, and I liked it but wouldn't necessarily recommend it over Wheelan's Naked Economics, Malkiel's A Random Walk Down Wall Street, or Greider's Secrets of the Temple.

Random Thoughts

With GE reporting decent earnings and no corresponding effect on the overall market, I have only three thoughts in my head:

1. The beatings will continue until morale improves.

2. The market can stay irrational longer than you can stay solvent.

3. Omnia munda mundis. (All things are pure to the pure in heart.)

I'm not sure why the last one popped in my head, but perhaps it's my subconscious asking for divine intervention. After today's buying, my retirement accounts are now fully invested. From December 7, 2007 until today, my retirement accounts have decreased 22.6%. The S&P 500 has fallen 42.8% during the same time period. My retirement accounts need to increase 29% to get back to December 2007 levels (a decline of 1% in your portfolio requires more than 1% to get it back to the pre-existing level--it's counter-intuitive, but true). I would say today is the bottom, but I've been wrong before.

Debt Clock

The national debt has become so large, the debt clock can't keep up:

http://www.mlive.com/flintjournal/voices/index.ssf/2008/10/and_the_debt_clock_says_time_t.html

You have to love the title: What time is it? "Time to kiss your future goodbye."

I Was Wrong

My September 18, 2008 call of capitulation was wrong. See call after the jump:

http://willworkforjustice.blogspot.com/2008/09/capitulation-is-hereagain-good-times-to.html

But today, on October 9, 2008, I feel like I called the bottom only a few weeks too early--which isn't a capital crime. Here is my take on the current situation, which I posted on Barry Ritholz's website:

It all depends on GE and Google. That's it--the double G's will determine whether we make or lose money. No other real catalyst on the horizon--interest rates have been cut, and money pumped in, so both the money supply and interest rates have been manipulated. After HP's positive earnings, I am feeling sanguine, despite the blood on the streets.

I bought a commodity fund for my 401k today, T Rowe Price's New Era fund. Being relatively young, I am a buyer at these levels. I just wish I had more gunpowder. My Roth IRA is already fully invested.

What the Japanese Stock Market Tells Us

Remember the Japanese and their banking problems? Japan is much different from the U.S., but this chart does not bode well for the U.S. stock market. Japan currently has the world's third largest GDP (on a purchasing power parity basis). Check out this article:

http://news.bbc.co.uk/1/hi/special_report/1997/asian_economic_woes/34500.stm

The Japanese economy was growing at a headlong rate, and companies were expanding and investing as never before.

The trouble was that much of this investment was being financed by an extraordinary boom in property and share prices. Property and shares were used as security for huge bank loans - and when the property markets and stock markets suddenly crashed at the beginning of the nineties the whole spiral of borrowing, asset price inflation and investment came to a full stop.

And despite many government initiatives to kick start demand, Japan's economy has remained fairly stagnant for the last six years. The stock market has been flat too, making it difficult for companies...to make profits.

Sound familiar? Defensive investors know that consumers will always need health care and consumer staples (e.g., Unilever products); however, investors looking for more than a 5 to 7% annual return are evaluating other options. After all, the key to getting high returns is determining the next high growth economic area and/or product.

U.S. companies realized earlier than most Americans that their growth would rely on non-U.S. countries. As a result, most major companies have shifted their emphasis overseas while lobbying for fewer trade restrictions. Now that the American consumer appears to be down and out, the question is whether the world economy can finally gain traction without the U.S. The most obvious way this decoupling will occur is if the American dollar is devalued, creating incentives for other countries to buy American products. If a Chinese yuan buys quite a bit of American goods, the Chinese consumer will feel flush and may start spending more, allowing the world economy to have more than one major source of income. A similar scenario can also play out with the Indian and Brazilian consumers. In fact, non-U.S. citizens must spend more in order to maintain economic stability.

Once you realize how small the American population is--only 5% of the world population--it's fairly easy to see that the most growth will come from abroad. As a result, trade restrictions will harm U.S. companies and their ability to expand and get their products into the hands of other countries' consumers. American companies that fail to achieve high growth rates will lay off workers in order to become more efficient. Thus, improving the job market means helping American companies gain more consumers, which means giving them more access to non-U.S. consumers. To achieve easy access to the international market, we have to negotiate with other countries and have fewer restrictions to encourage a free flow of ideas, money, and traffic. As much as we may hate to admit it, reducing trade restrictions and devaluing the American dollar may actually stabilize the world economy in the long run.

At the end of the day, what choice do we have, really? The American consumer is tapped out. Other countries' consumers must step up to the plate, and we need to encourage them to do so. In an era where the world economy requires more trust between countries, the latest failure of the Doha Development Round is an ominous portent. Thankfully, the failure of governments is not determinative.

The American corporations that succeed will be the ones who understand that the American consumer is but one small slice of a very large worldwide pie. In an era of cynicism, skepticism, and security fears, we must regain our confidence and look to maximize our international footprint through trade and superior products. The "Post-American world" can no longer be an amorphous, distant concept if we are to succeed--Americans must begin to see the world as one large marketplace in which they have the advantage because of their greater access to technology (Google, Yahoo, eBay, Intel, etc. all made in the U.S.A.); the world's common language (English); an above average health care system (better health means more productivity); and entrepreneurship (it can take less than a week to set up a small business in California--for fun, compare that time with India and its small business rules/red tape).

I never thought I would advocate a weaker domestic currency, but sad times create sad consequences. The time has come to work harder and re-gain our stature in the world. When the non-U.S. buyers come, America must welcome them with open arms and the American attitude formerly known as optimistic. America is down, but as long as we have immigrants arriving and hoping for a better future, you cannot count America out. For better or worse, we are still the world's major repository for dreams. That's why I don't see a Japan-style economic morass happening in America--Japan is getting older and has never liked immigration. As long as we stay away from protectionism and encourage responsible immigration, we will do just fine.

VeriFone (PAY) Shareholder Meeting

VeriFone's (symbol: PAY) 2008 annual shareholder meeting took place today at the Doubletree Hotel in downtown San Jose.

VeriFone, Inc. is a payment-processing-technology specialist. When you use your credit or debit card, someone has to handle the transfer of information from Point A to Point B in a secure format. VeriFone is trying to position itself as the worldwide financial middleman. However, it has been plagued by accounting scandals and as a result, its stock price is near a 52-week low.

The meeting was a bare-bones event. VeriFone did not have a presentation. The informal portion of the meeting involved only a Q&A session and lasted under 10 minutes. Only water was served from a cooler. Only three non-employees attended. I asked about the financial irregularities. The CEO said VeriFone had replaced the CFO and the general counsel in an effort to reform the company. He said the specific accounting problem was that the company overstated inventory and understated the cost of goods. (This accounting problem would cause the company to report an incorrect higher net profit for most of last year.) Class action lawsuits have been filed against VeriFone, and the 10K did not list any settlements or pending resolutions.

I asked several other questions about the company's business. The CEO's responses are below:

1. VeriFone already has 65% market share in the U.S and Canada, and Hypercom is their primary competitor. The main reason VeriFone does not have more market share is because the market wants an alternative, even if that alternative is not as good as VeriFone.

2. (The 10K states that profit margins are lower in the U.S. and Canada, but VeriFone is seeking to expand more internationally rather than domestically.) The reason VeriFone is focusing on international expansion is because emerging markets are not saturated. Only around 1 to 20% of retailers in Brazil, Turkey and other emerging markets use payment-processing technology, and the opportunities for growth are much better.

3. VeriFone's competitive advantage is that it spends the most on R&D and has the most employees. They are a safe, if not the safest, choice.

As a value play, it's hard to go against VeriFone. At the same time, it's also hard to promote a company that had ethical issues as recently as last year, especially in a post-Sarbanes-Oxley world. I personally think there are better companies in which to invest, but others may want to consider VeriFone after it resolves outstanding litigation.

Disclosure: I own less than 30 shares of Verifone (PAY).

Who Pays Taxes?

The WSJ (A25, October 7, 2008) had more statistics on the tax debate:

The top 20% pay 67% of all federal taxes--including not just income taxes, but payroll taxes, corporate taxes, and death/estate taxes. The top 1% of earners pay 26% of all federal taxes.

If Republicans want a return to the Reagan era, pointing out raw numbers isn't the way to get there. The average American knows the rich make the lion's share of money in this country. He also knows that no matter what the percentages and numbers are, unlike the average American, the rich don't have to worry about housing, food, or health care. Despite this knowledge, taxes have continued to come down for years in this country because the average American doesn't hate most rich people. In modern-day America, the majority of super-rich people don't inherit their wealth--they earn it, which gives them some immunity from European-style envy. Thus, the key goal of low-taxation advocates shouldn't be fairness per se. Instead, the goal should be to assure that everyone's tax contributions--no matter what the amount--are spent improving access to health care, infrastructure, and other quality-of-life services as well as cutting wasteful spending. A single dollar collected that goes towards more laws, more useless agencies, more unnecessary subsidies, and more lobbyist requests will damage everyone's faith in the system. In short, low-tax advocates must convince everyone that all taxes collected are going towards necessary services.

Americans want to be rich, so bashing the rich won't work in America as a primary political platform. The average American probably cares more about a) whether his or her tax dollars are spent for necessary services rather than special-interest spending; and b) whether taxes are enough to cover necessary services. Thus, the debate should be about what services are necessary, how the government can best deliver them, and whether the government is the best entity to deliver those services.

Barry Diller on Online Advertising

Barry Diller had an interesting interview today in the WSJ.

You really want to get a headache? Try to understand Internet advertising. Social networking advertising is being discounted because there is so much inventory [of available ad spots], and because methods have not yet been found to make it very effective. Will that get figured out? I absolutely believe it will. What form will it take? Absolutely unknown.

Mark Cuban seems to have found a potential solution/form in www.hulu.com

Update: DJIA Down 550 Points

Yes, it's a bloodbath today in the markets, but I am buying. In fact, I've spent more money today than I ever have, if you include my 401k purchases. As for individual stock picks, I bought GOOG, STT, YHOO, GE, and even some WYNN. Visa (V) looked interesting, too. Remember, Visa and Mastercard don't loan anyone money--they're just middlemen who get a transaction fee. In contrast, Discover and American Express have a more risky practice of loaning money themselves to certain customers or exposing some of their own assets to risk. I predict this recession will be over by May 2009, having started in December 2007. I hope to flip GOOG this week.

Best...Spoof...Ever

© Columbia Business School Follies

http://www0.gsb.columbia.edu/students/organizations/follies/Follies/Welcome.html

Mark Cuban on How to Get Rich

More evidence Mark Cuban is a straight-talking genius:

http://blogmaverick.com/2008/10/04/how-to-get-rich/

I identify with the ketchup and mustard sandwiches (for me, it was Jack in the Box's 99 cent chicken sandwiches). I have a long way to go before even getting a tiny fraction of Cuban's net worth, but I am happy I currently have no debt after going to law school.

Dave Ramsey's Plan

It's a moot point now, but here was Dave Ramsey's proposed plan:

http://www.daveramsey.com/common_sense_fix.txt

I mention it only because it recommends eliminating the capital gains tax entirely. His rationale is that rich people will use their own money to invest in the market--rather than risk not beating inflation by staying in cash or 2% money market funds--and the market will rise again on the backs of the upper class's investments, not general taxpayers. You have to admit, it's an interesting idea.

Stocks Update, October 3, 2008

What a crazy day. After the House passed the bailout bill, the stock market actually went down. I made several trades and managed to do reasonably well, except I re-bought STT too soon after selling. I am currently experiencing a loss on STT and hope to sell within two weeks.

Also, the percentages for EMC and Yahoo are slightly off, because I dipped into my non-retirement accounts to buy some shares. I am losing a few hundred dollars on the trades in my non-retirement funds, but nothing that significantly impacts the percentages below.

I added MGM to my open positions at about 2,000 dollars' worth. Vegas relies on now-nervous California citizens for much of its income, but I am willing to bet a small amount that Vegas has some more tricks up its sleeve. I also wouldn't be surprised to see Dubai provide the 500 billion dollars needed to complete the latest MGM project. I still don't like MGM's CEO, J. Terrence Lanni, so I probably won't add to my MGM position.

My major positions are now STT, YHOO, SWZ, and GXC. Yahoo stock seems priced far too low.

Open Positions
CCT = -7.95
EMC = -13.58
EZU = -16.73
GXC = -12.15
MGM = -3.45
IF = -33.37
STT = -8.45 (afterhours price)
SWZ = -12.62
VPL = -13.80
YHOO = -16.09

[Average of "Open Positions": losing/negative average 13.82%]
[138.19/10]

Closed Positions:
Held more than seven days but less than one year (from May 30, 2008):
CNB = +10.0
EQ = -8.83
EWM =-11.61 [sold 9/22/08]
EWS = -12.98 [sold 9/22/08]
GE = -6.4
GLD = +8.61 [sold 9/22/08]
INTC = 0.0 (excluded from average; insignificant movement)
KOL = -10.36
PFE = -5.5
PNK = -16.7
PPS = -2.8
VNQ = +2.37 [sold 8/7/08]
WFR = +0.9 (approx; based on partial sales week of 8/4/08 in two separate accounts)
WYE = +2.4

[Overall Record for 7 days+ trades: lost an average of 3.92%]
[-50.90 / 13 trades]

Held less than 7 days:
DUK = (0%, excluded from avg) [8/07/08 - 8/14/08]; GE (1.0%); GOOG (0.8%) [7/28/08 - 7/29/08]; GOOG (5.4) [9/29 - 9/30]; GRMN (-6.2%) [Sold 8/5/08]; ICE (2.0%), MMM (0.5%), MRK (0.1%), KOL (13.2%) [9/17/08 to 9/19/08]; MOS (10.4%) [10/6/08 to 10/8/08]; NVDA (8.0%) [8/12 to 8/13/08]; PFE (1.3%), SCUR (15%); SO (-0.3%) [Sold 8/5/08]; STT (2.68%) [10/1/08 to 10/3/08]; STT (0.4%) [10/3/08 to 10/7/08]; TTWO (4.3%) [partial sales on 8/5/08, 8/7/08, and 8/8/08]; TTWO (2.2%) [9/9/08 to 9/12/08]

[Overall Record for ultra short-term 2 to 7 days trades: gained an avg of 3.57%]
[60.78 / 17 trades; as of 10/8/08]

Daytrades:
C = +11.49 (09/01/08)
PFE = +0.5%
GE = +0.5% (Updated on July 14, 2008; bought at 27.15, sold at 27.30)
STT = +0.3
XLF = +4.3% (Updated on July 15, 2008)

[Overall Record for daytrades: Gained an average of 3.35%]
16.79/5

Compare to S&P 500: losing/negative 20.67%
[from May 30, 2008 (1385.67) to October 3, 2008 (1099.23)]

The information on this site is provided for discussion purposes only and does not constitute investing recommendations. Under no circumstances does this information represent a recommendation to buy or sell securities or make any kind of an investment. You are responsible for your own due diligence.

California Out of Money?

According to Reuters, California Treasurer Bill Lockyer said the most populous U.S. state's cash reserves may be exhausted near the end of October, and various state-funded services are at risk of grinding to a halt.

Governor Schwarzenegger is apparently going to ask the federal government for 7 billion dollars. Good timing--after 700 billion, 7 billion is going to seem eminently reasonable.

When Californians vote on their various propositions, they should remember California's budget problems (i.e., no money). Almost every Proposition requires more money. When in doubt, vote "no." The only Proposition I will be voting for is Prop 11. Everything else seems to require money Californians don't have.

Wisdom: Father Theodore Hesburgh

From Father Theodore Hesburgh, courtesy of the WSJ (9/30/08, A15):

People are tough on people, but I love people, and the great, great, great majority of people are very good. We have our share of sinners, even in all the great religions of the world, but I think the fact that people keep trying is the most important thing of all, and I'd like to be one of those who keep trying.

Tom Toles on the Bailout

In honor of the bailout, I give you Tom Toles. The man is an absolute genius.

http://www.washingtonpost.com/wp-srv/opinions/cartoonsandvideos/toles_main.html?name=Toles&date=09242008&type=c

(September 24, 2008, Washington Post)