Jim Rogers "Who Are These Clowns In Washington"
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posted by jmf at 11:41 PM
Monday, September 24, 2007
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11 Comments:
Faber: How investors can beat hyper-inflation
In a typically bearish appraisal, author of the Gloom Boom and Doom Report Marc Faber advised investors on the last day of the CLSA Hong Kong forum on Friday to stock up on physical gold and rural real estate ahead of possible global conflicts and US stagflation (inflation without growth, last seen in the 1970s.)
.....
Hat tip to
New York City Housing Bubble
Interesting how he says most commodities will go "much, much higher" in the coming years, including wheat, but then immediately says he wouldn't buy wheat at these levels. To me this is the working of everyone's basic instinct to avoid assets that have recently risen sharply, for fear that they will very soon go down just as sharply. But the markets are, in fact, full of many counterexamples: stocks that go up very often keep going up, even when you think they cannot possibly go up any further. RIMM, BIDU may be two good current examples. AAPL also perhaps. GOOG a couple of years ago, maybe even again right now. This is why people like "momentum" plays -- they yield profits. Disregard valuation concerns and buy is often good advice. As is using stops.
eh
Moin Eh,
i agree. But i don´t have the guts to chase these kind of assets. I try to get into before the spike or slump will occur...
But the markets stay longer nuts than ...... And the danger is that you run out of money before you will be proven right....
Rogers is and was right for more than 5 years now and as he said "I´m probably the worst market timer" ( have also a book from him)
I disagree, i´m probably worse.... but i have improved quite a little bit.
Yes, it can be tough to pull the trigger. But I have learned to do it with reasonably good judgement. And like I said using stops can give you some peace of mind.
I made money on AAPL earlier this year, buying in at 120 (already well up on the year) before the release of the iPhone, then selling at 147 about 5 weeks later. I have also made money on GOOG, although I sold at 545 just before their last earnings (they tanked damals). Still kicking myself for not buying in again when they sank to 110 and 485 respectively back in mid-August. Am not looking seriously at either now. Can't bring myself to even think about AMZN.
eh
Not too surprising:
Lennar loss bigger than expected
No. 1 home builder in terms of revenue sees sharp drop in new orders, deliveries, as it cuts staff and plans more layoffs
Most of it from writedowns -- "impairments". Operational weakness will no doubt contribute more in coming quarters:
...orders plunged 48 percent to 5,804. It also saw its cancellation rate rise to 32 percent of orders.
eh
Banks could take a lesson from HBs in 'mark to market'.
eh
Moin Eh,
this kind of earnings or loss release will be common in late 07 or early 08 with the financials....
Compare this to the estimates from "Wall Street Finest" that have estimated a profit of $ 0,25 just 90 days ago.... Their latest call was for a loss of $ 0,55.....
I found this number also interesting.
The average sales price of homes delivered decreased to $296,000 in the third quarter of 2007 from $316,000 in the same period last year, primarily due to higher sales incentives offered to homebuyers ($46,000 per home delivered in the third quarter of 2007, compared to $35,900 per home delivered in the same period last year).
In the last quarter they reported $43,700 per home delivered.
With orders down almost 50% it looks like they have to offer more..... :-)
With orders down almost 50% it looks like they have to offer more..... :-)
They won't be able to offer enough -- people won't want to buy if they sense the house may lose value. Prices will have to hit some kind of bottom to bring buyers back in large numbers, and I don't see this happening soon because inventory will only grow as more current mortgage holders default. And if you look at the most recent data, new single family home starts were significantly above the annualized sales pace, which is crazy.
Reading these earnings reports carefully, often you see that HBs are still operating profitably, which is amazing; you tend to think we are nowhere near a bottom with builders still generating positive earnings from operations. The losses come from writedowns ('marking to market'), which means, basically, wasted capital, money invested that will not be returning anything. Lots of it. Which means deteriorating balance sheets and heavier dependence on borrowing on much less favorable terms in the future. Many of the major public HBs will have to shrink drastically in order to survive.
There may be some room left to short the HBs here, although I covered most of mine back in mid-August. Wishing I'd shorted XHB again when it popped up above 26 not that long ago...Wahnsinn.
eh
US Home Price Decline Accelerates
A house is an asset, and people don't want to buy a depreciating asset.
Reminds of some used car ads I've seen:
'$10k invested, sacrifice for $8k'
Man, that was a lousy 'investment'.
eh
Moin,
yup....
Looking at
this housing chart from the NYT is is clear that we have seen nothing yet..... :-)
Is The Fed Flushing Out The “Excess Credit” Demons? / Aaron Krowne
With this in mind, those generally suspicious of the Fed might not be surprised to find out that the Bernanke bunch is busy suspending even more reserve requirements for many major banks amidst this credit crisis. Specifically here I am referring to bank off-balance-sheet conduit subsidiaries (this is now how money market and similar vehicles are handled… which is a sketchy fact in and of itself). The Fed is apparently piling up exceptions to its regulation 23A, which normally mandates 10% reserves for such conduit entities. The exceptions “temporarily” suspend these reserve requirements. They are open-ended. Hmmm.
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