Saturday, October 29, 2011

Review of Barron's, Dated 31 October

The Cover Story of this weekend's Barron's is the Big Money Poll (although the Bull / Bear cartoon some hides that).  I started paying attention to the Big Money Poll when I noted that in October 2007 (7), the only non-financial related question was who would be our next president.  The plurality chose Barrack Obama, when it was "obvious" to me and many others that Hillary was going to squash him like a bug.

Well it is now October, 2011, and they asked a similar question (actually three):

1)  Do you expect the federal government to achieve meaningful deficit reductions in the next 12 months?

Yes: 22%
No:  78%

[WHO could the dummies be thinking .gov will reduce its deficit?]

2)  Who will be the Republican candidate for president in November 2012?:

Mitt Romney        83%
Rick Perry             8%
Herman Cain          2%

[Where is Ron Paul?]

3)  Will President Barack Obama or the Republican candidate win the November 2012 presidential election?:

Obama           30%
GOP              70%

Place your bets...

---

Token Pet Bear at Barron's Alan Abelson typically writes two or three pieces in his weekly column.  In Part One he is dubious of Europe's "solution" of the Greek haircut/bailout problem, hey, who isn't?  In Part Two he brings in John Williams (of Shadow Government Statistics) to debunk the notion that we are in a decent recovery, we are not.  In Part Three he brings us analysts who say Europe is going down and China is going down.

At least we know where HE stands!

---

ITT is to split apart its company into three pieces. One of them, Xylem (XLM) is the largest pure-play on the WATER BUSINESS worldwide.  [This could be a winner...]

---

Michael Santoli's column took a pretty nice poke at the odious Jon Corzine (ex-Goldman Sachs, ex-Senator from New Jersey) who is now heading up MF Global Holdings (an investment company).  MF this week got slammed BIG because of bad bets made in Europe.  There are potential buyers looking at pieces or personnel at MF, one of them, is Goldman Sachs!

---

Miriam Gottfried says that Goodyear (GT) is BUY, in part because they make higher margin tires than rivals like Cooper Tire.  Hey maybe so, the P/E is 6.8 and revenue and profit look to be going up.  [No, thank you]

---

Groupon is finally supposed to IPO on Thursday.. Good luck Groupon!  They do not have a "moat" to defend anything they do, they have competition from a real company (LivingSocial) and Google and Facebook have initiatives aimed direct at their heart.  [No, thank you]

---

"D.C. Current" author Jim McTague tells us the tale this week of a Mr. Andrey Hicks.  Mr. Hicks alledgedly defrauded 10 investors of $1.7 million claiming he could get them higher returns because of his super-smart High Frequency Trading firm (which did not exist).  He enticed these investors by pushing his PhD from Harvard in in 2007.  Uh, no.  The SEC says that he only took ONE math course at Harvard, and got a "D" in it.

He was arrested in Canada en route to Switzerland.  Turns out the SEC itself (well, er, the Boston office, I guess the SEC in DC is still scouring the Web for more tranny porn...) launched a civil complaint against Mr. Hicks.

---

I guess the world of Contemporary Art is heating up again! Daniel Grant writes of the expectations of art auctions in NYC coming up soon.  Gustav Klimt, Roy Lichtenstein and Andy Warhol are all artists whose works are up for auction.  You know, just in case you wanted to know...

---

"Economic Beat" author Gene Epstein looks at our feeble recovery vs. deficit spending.  His observation?  That our huge leap in debt has been much larger (yet showing poorer) results than in past recoveries.  He concludes:

"More on the causes of our economic malaise in future columns."

---

"Technology Week" author this week is Dimitra DeFotis.  She analyzes this week Amazon and Barnes & Noble.  The latter is branching out into other products beyond (online) books.

Yet Amazon looks like they are very strong.  They had low numbers this quarter mostly because of spening on infrastructure. She expects much results in the coming quarters.

Amazon is a company worth keeping an eye on (positively that is).

---

Barron's had the participants of their Art Of Successful Investing interviewed.  There is too much information for me to adequately summarize.  Likes include energy and Oracle.  Dislikes include Fusion-io (recommended in last week's Barron's, LOL...) and anything Euro...

---

Capitalist Thomas G. Donlan writes the main Editorial.  He uses the term "Existential Blackmail" in describing the "hurry up and do it or we are all dead" approach that the Euroguys and Eurogals have been up to these past few weeks (reminds me of Hank Paulson telling Pelosi something similar...).

He is very bearish on what Europe will bring us...

---

In the "Commodities Corner" article (Market Week section), the narrowing of the WTI vs. Brent crude prices is explained.  Lower inventories in Cushing, OK (where the WTI Crude price is set).

Not mentioned anywhere per se is the NICE leap we had in all four precious metals and an even BIGGER leap up in copper (some 15%) last week.

---

Nothing new in at the Fed Data Bank nor in the monetary base nor M1 money supply that I could tease out.

***  I believe I will go ahead and note the Peruvian Sol (their currency) which AGAIN gained on the US$ (it is now at approx. 2.71 to the $).  A couple of years ago one US$ got you 3.45 soles.  That is quite a loss of the dollar vs. that of a poor South American country (admittedly with large exports of primary commodities).  ***

Angela Merkel

Here's an interesting recent quotation from Angela Merkel with comments before and after:


And let’s be clear on what Merkel’s message was to the Bundestag – because it was one of the most frightening things I have ever seen. Here is her quote from yesterday –

“What is good for Europe is good for Germany, half a century of peace and prosperity in Germany and Europe testify to that. No one should think that a further half century of peace and prosperity is assured. It isn’t. And that’s why I say if the euro fails, Europe will fail, and that mustn’t happen.”

What is the message to the German people? Pay up or return to the unthinkable. Do not underestimate how messy all of this is in Europe. And do not underestimate how much of this Euro area crisis resolution – and bailout process – is tied to the events of 70 years ago. What Merkel said yesterday was probably the single most important statement that has been made from any politician since this crisis began. Scary and important!

From:

http://confoundedinterest.wordpress.com/

From Bruce Krasting...


Bruce Krasting is an ex-Wall Streeter who publishes a blog and is a frquent contributor to Zero Hedge.  The below is the last part of his latest piece.  The piece is about food costs.  Does he sound angry about anyone?

"It’s old news that China and the other big/fast growing populations are consuming an ever-increasing amount of the world's supply. But these numbers are scary big. If the underlying trends continue(why would they not?) then we are headed into supply problems that can only mean rapidly rising prices.
This conclusion gets back to the beginning. Food inflation in America is running today at 5+%. The USDA says the inflation will moderate next year. This is more government hopium. I’ll take the “over” on their numbers. In my view rapid increases over the next decade are baked in the cake.
The most regressive economic consequence is for food inflation to take place. We have 45mm Americans on food stamps and tens of millions of others on the edge. I find it ironic that the Federal Reserve excludes food inflation when setting monetary policy. While the Fed can’t be blamed for rising food costs, they are most certainly stoking the fires.
Bernanke has said he wants to contain inflation (excluding food and energy) at less than 2%. Food inflation is running at double his target. Possibly Ben needs a new Mandate."
.

Tuesday, October 25, 2011

Europe Explained In One Diagram

The below cartoon is self-explanatory...



It comes to us from Link: 

TEOTWAWKI -- New Book Edition

Readers who have been here a while know that I am interested in "survival" as a subject.  In an article in May, I wrote about TEOTWAWKI ("The End Of The World As We Know It") and guns, later on another article about TEOTWAWKI and water.

Well I can highly recommend a new book just out:

Survivors, by James Wesley, Rawles (that's how he writes his name).  The book is fiction.

Rawles is also the head of survivalblog.com, probably the single biggest blog on survival related topics on the 'Net.

I do not want to say too much about the book other than it is very readable.  It takes place in different parts of the USA (and elsewhere) than his earlier book Patriots.  You do NOT have to read Patriots first, they are independent books.  If you can put up with the fairly Christian slant to the book (and hey, being a tough Christian might help you survive!), then anyone interested in the subject will like it.

pmbug.com

I have visited pmbug.com (mentioned briefly in my last article) and found it to be an interesting site, one I will continue to contribute (comments) to.

It is a forum style site, and the administrator allows people who join (free, no hoops) to even start threads, as I did just today.  It looks like his site (quite new) may take off.  It is a less frenetic site than Zero Hedge or tfmetalsreport.com.  Mr. Ferguson has a great site, but the fast pace of his site is not for me, as I get all the speed I need at ZH.  And yet pmbug.com runs at a quicker clip than fofoa.blogspot.com and covers more territory.

I invite you all to go and take a look at that website.  It is quite possible that he may attract real experts: people who could tell us how to detect phony gold, people who know about other precious metals (like platinum and iridium).

Any of you who have expertise with IRIDIUM metal, please let me know!


Gold is on a little tear...  But, some over at ZH advise caution in being long, they do not like the "price action" (?).  Perhaps those commenting like that are traders, not stackers.

Monday, October 24, 2011

Another Article That's Different, 道德經

Reader "PMBug" (who has an interesting forum: pmbug.com (about precious metals of course) I will likely go spend some quality time there sometime soon) quotes Lao Tzu (Lao Tse, Laozi) as part of his signature line.  Lao Tzu founded the Chinese religion (not a typical religion though) of Taoism in about 500 BC.

In his day he was famed for his knowledge about the way the world worked and for his insights.  The legend is that when he became very old, he headed out to the deserts west of China.  As he passed the last outpost, a guard asked him to write down his thoughts.  That work is now known as the Tao Te Ching, and is by far the most important work in Taoism.  The rest is commentary (although the founder of Confucianism is a major commentator of Taoism).

I bumped into Taoism in college (where else?) in 1976.  It was "obvious" to me that there was something important there, that it had great value and great wisdom.  I ran into it again when I started doing Tai Chi (8 years ago), Tai Chi has incorporated many Taoist principals into the art.  My understanding of at least part of modern Taoism is that it has picked up a lot of ritual and weird stuff (men should have sex only with pretty girls who are young) that seem to have no basis in the original Tao Te Ching.

The Tao Te Ching is available at any big bookstore, but some translations "work" better (at least for me) than others.  The translation I like the best is by Gia-Fu Feng (pictures by Jane English) published in 1972 (hah!) by Vantage.  Just inside the cover the price was stamped.  $3.95!  Greatest bargain ever?


If Taoism would be of interest to any of you, dear readers, wikipedia has a great article on it if you don't want to wait around for me to finish this, FYI wikipedia has two GREAT articles that I have recently enjoyed, "The Rothschild Family" and "Absinthe", two subjects I was curious about.  I copy the first paragraph from wikipedia about Taoism: is

Taoism (also spelled Daoism) refers to a philosophical or religious tradition in which the basic concept is to establish harmony with the Tao(道), which is everything that exists, the origin of everything and because of the latter it is also nothing. The word "Tao" (or "Dao", depending on the romanization scheme) is usually translated as "way", "path" or "principle". Taoism had not only a profound influence on the culture of China, but also on neighboring countries. While the philosophical Taoism is not institutionalized, the religious Taoism is institutionalized and present in multiple countries. Taoist philosophy is deeply rooted in contemporary China, and is unavoidable part of modern Chinese life.[1]


Also the famous Yin-Yang symbol is based on the Tao (thanks wikipedia!)


Taoism

Saturday, October 22, 2011

Review of Barron's, Dated 24 October

With the Cover Story being about their Top 10 Picks in techland, I thought, OK, I'll buy the Barron's.

Since Groupon is about to IPO itself (next week I believe), their picks of tech stocks to look at is timely.  Author Mark Veverka notes that tech is cheap now and yet looks like it will outgrow our economy's 1% - 2% per year.  Also, he notes that there has been a reasonable amount of acquisitions in the space, as many tech companies now have $$$ sitting on their balance sheets.

Veverka worked with Walter Price, Jr., Daniel Niles and Mike Stark to come up with the below list of 10 top picks (my remarks at end of each in blue):

1)  Fusion-io (FIO)  "Fusion-io does for storage what former stock-market favorite VMWare does for computer servers."  Price $25.17, 12-month target: $52 (+107%).  I have never even heard of this company.


2)  Oracle (ORCL)  Rephrasing Veverka, Oracle has now almost attained a similar stature as IBM, they expect revenue of 15% this year and next.  Price: $31.53, 12-month target: $40 (+27%).  Yeah, OK, maybe so.


3)  Tibco Softward (TIBX)  They specialize in middleware, and "They're well positioned to be the bridge company between existing applications that you don't want to change and new applications that are more flexible and built in the cloud", Price explains.  Price: $26.64, 12-month target: $35 (+31%).   Built in the cloud..., other than that no comment.


4)  Electronic Arts (ERTS)  "Mobile social-interactive gaming is a big opportunity for the company..."  They have a game on Facebook that is the No. 2 game there.  Price $23.41, 12-month target: $40 (+71%).  OK, maybe so, there sure seem to be a LOT of people much younger then me who play these games, whether on Facebook or not.


5)  Nuance Coomunications (NUAN)  Niles thinks that speech recognition technology will rival touch-screen tech.  They already make Dragon speech-recognition software for PCs and they may capture wireless makers like HTC, Nokia, Motorola and Samsung (among others).  Price: $23.99, 12-month target: $30 (+25%)  Who knows?  Not me!


6)  Ancestry.com (ACOM)  "Ancestry.com is the social-media company for dead people." [Ha ha, line fo the day]  The stock has gotten whacked because of a bungled (like NFLX) because of a badly done pricing change, but they think this company will do well.  Price: $22.21, 12-month target: $44 (+98%).  I do not have a feel for these guys...


7)  Hewlett-Packard (HPQ)  They note that the shares change hands at 5 x earnings, the lowest ever for any large-cap tech. Yes, ever.  Niles and Price have high hopes for new CEO Meg Whitman.  Price: $24.74, 12-month target: $30 (+21%).  Maybe.


8)  eBay (EBAY)  They are tinkering with their model (over 50% of their sales are now fixed-price) and are placing a bet on PayPal for their future.  Price: $32.15, 12-month target: $40 (+24%).  I do not have a feel for these guys either...


9)  Fortinet (FTNT)  They make security hardware and software that apparently is fast, useful for cloud computing and also have subscription & maintenance fees trickling in every month.  Price: $18.22, 3-year target: $25.65 (+41%).  Who?


10)  Apple (AAPL)  They like Apple.  Apple has just 6% global handset market (No. 1 Nokia has 25%).  New boss Tim Cook might make some changes with their $28 billion in cash, like maybe a dividend...  I wouldn't know about the future, but Apple has executed very well for YEARS now.


---

Alan Abelson, the resident bear at Barron's, does not think either Europe or China (referring to ALbert Edwards re China) will work out their problems anytime soon.

---

There were two BULLISH articles on individual companies: Freeport-McMoRan and Teradata.  I know that one of my readers is interested in FCX...

Jim McTague goes after the regulators of the Fed for sloppiness during the financial crisis (two recent reports from .gov came out recently with all the no bid contracts on "fixing" the problems arguably caused by the Banksters themselves).  Hey, welcome to the club, Jim!

---

I usually do not bother reading the relatively new weekly column "CEO Spotlight", but this week's article captured me...  Lawrence Strauss does a nice job doing a bio on EOG Resources boss Mark Papa.  EOG came out from Enron, and has now ditched their NatGas operations to focus in on horizontal drilling plays like the Bakken and Eagle Ford Shale plays of getting oil...  Mr. Papa has had an interesting life, I recommend the article!

"Economic Beat" author Gene Epstein says chances for4 a recession may be ebbing...  He also revealed that he was a street demonstrator in 1968 Chicago!  Well, who knew that?    He passed along a link of Peter Schiff out-debating some OWS-ers, and then saying that Schiff should have put them on a bus to Capitol Hill.  The link is here

In the Market Week section ("European Trader")we find that Europe will likely NOT work out a deal re Greece (etc.) anytime soon.

Your ever watchful Junior Blogger never misses reading "Commodities Corner", this week about about the sorry state of natural gas (prices).  Warm weather, lots of supply (and more coming) look like NatGas will not be going up anytime soon [R. Mix note:  Hey, you there at .gov: we are missing an opportunity here to convert some of our fleets to NatGas!  PERU ferchrissakes has done that!]

As mentioned earlier, Groupon expects to IPO this week, 34.5 million shares at about $10 each (expected DOWN from earlier, hey great timing guys!).

Nothing new or interesting at the Federal Reserve Data Bank re the Total nor changes in the Monetary Base or M1 or M2 money supply.

Verdict: If you like tech stocks definitely buy this edition!

Monday, October 17, 2011

Bearing Sales -- Ameru Trading del Peru S.A.

I already know that most of you could care less about bearing sales in Peru, but I put this here (cross-posting from my two other more bearing related blogs rodajesperu.blogspot.com (Spanish) and rollingbearing.blogspot.com (English)) for anyone who may take an interest.  I also understand that the Codings below are pure gibberish to anyone outside the bearings business...

The following line-items represent a hair over 67% of our total sales from 2009 - 2011.  These bearings represent all of "Page 1" bearings (best selling pieces, all in declining order) and about one third of "Page 2" bearings (which are important but to a lesser degree).  There are about 15 pages of this kind of sales data...

*** For anyone who likes STATISTICS, I massaged the raw data and then ran a statistical procedure called "Factor Analysis" to help me gain a better understanding of which pieces sold "together".  I used the program "S", which Bell Labs I believe first wrote many years ago, a free variant of this program ("R") is available FREE on the Internet.  It is much harder to use than SPSS.  Please email me if you are interested in this kind of stuff.  ***


"Blanks" ("nulls" in my database) indicate $0.00 of sales.  I took out the $-figures so that our company is not a complete open book to the world...

"Codigos" starting "02" are KBC (Korea), starting with "11" are Iljin" (Korea as well) and "13" are "MBS" (Japan).  Our company is on track to eliminating a whole bunch of slow moving bearings in other brands, as MBS in particular is going to produce some of our top sellers in Koyo ("03", Japan), and thus allow us to better focus on our best selling items.  We are more skewed than the famous 80/20 (Pareto) Principle.  A great book on the 80/20 Principle is The 80/20 Principle (Richard Koch, 1998, maybe later editions?).



Codigo
Total Qty
2009
2010
2011
02-6007-RS    
111579
36984
38515
36080
C3-RCT283SA   
10201
4080
5118
1003
02-6007-2RSF  
32422
10868
21553
1
02-6000-2RSC  
63926
21422
25184
17320
02-6204-2RS   
31142
9582
11178
10382
02-6205-RSC3  
27054
9194
9969
7891
03-DAC3872-8  
3831
1576
1155
1100
02-6302-2RS   
29564
11553
11225
6786
11-IJ-212001  
759
120
230
409
11-IJ-113002  
964
278
428
258
02-6002-2RS   
33771
11653
13963
8155
02-33005-JG   
8124
2312
2658
3154
02-6007-2RSC  
10794
685
3281
6828
02-6007-ZZ    
12292
9746
864
1682
02-68149G/11  
8036
3017
3855
1164
11-IJ-111003  
1596
596
415
585
11-IJ-113015  
548
150
245
153
11-IJ-111001  
1503
365
346
792
03-02474/20   
2779
1896
675
208
02-32004-XJG  
4980
1326
1824
1830
02-TR285216G  
4112
1891
1257
964
02-38KW01CG5  
4018
2008
1226
784
02-6206/20C3  
4159
1590
1478
1091
18-AU0844-1   
1226
1027
199
03-28584/21   
1077
684
190
203
03-DAC3562W   
955
293
291
371
18-DE08A33C    
1237
1237
11-IJ-111009  
1071
396
300
375
13-38BWD22    
1000
269
731
02-30205-J    
4712
1081
1858
1773
03-12649/10   
2436
339
935
1162
11-IJ-113017  
239
102
98
39
17-38BWD22LC   
599
230
369
03-3579R/25   
713
504
50
159
02-6207-2RS   
3142
931
1236
975
11-IJ-111002  
560
186
211
163
29-518445/10  
692
231
200
261
02-30204-J    
4097
1299
1446
1352
11-IJ-141008  
740
298
442
03-48548/10   
1743
255
481
1007
C4-58TKA3703  
663
439
51
173
02-11749/10   
3131
639
1686
806
03-469/453X   
474
236
219
19
03-30212-JR   
688
417
101
170
02-6203-2RS   
6073
1931
2381
1761
13-MB0814     
621
304
317
02-69349G/10  
1702
722
450
530
03-12749/10   
1650
619
636
395
02-33012-J    
552
245
163
144
13-M3874W     
600
184
416
03-11749R/10  
1738
729
709
300
03-DAC3871W   
404
55
272
77
29-32219      
469
241
120
108
03-30309-DJR  
407
179
29
199
29-29685/20   
1210
300
910
02-DT-458448  
293
193
100
17-42BWD06CA  
378
119
259
JV-949100333  
746
294
309
143
11-IJ-112001  
192
66
66
60
17-34BWD04BC  
430
247
183
03-6203 2RS   
2980
1205
1117
658
02-6205-ZZ    
3310
2307
1003
13-M3872W     
505
109
396
02-48548/10   
1621
794
552
275
JV-949100348  
770
357
230
183