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).  ***


  1. For what it's worth, the blue chip art market has remained strong even through the worst of the recession. Many artists, particularly the Impressionists, hit their highest auction prices in the last couple of years. The only other reason art sales are happening are if someone absolutely has to have original art in a space (i.e. a high end home or office space), and those artists who have a following of collectors who know they can now probably negotiate a deal on certain pieces they like -- outside of the galleries (which take 50% or more).

    Personally, I can't explain the appeal of Warhol and Rauschenberg and the other Pop artists because when you move away from nature as inspiration, you end up with mere design. I do like Klimt, but he's different. Everyone has an opinion, right?

  2. Modern art is a black hole of ignorance for me Jena, thank you for your comment, hey I earned something new from you.

    I agree re appeal of abstract and pop art, it does nothing for me. Almost everything newer than the Impressionists just does not do anything for me.

    Although I did have a chance to see REALLY UP CLOSE a Picasso lithograph, and I could see his excellence as an artist.

  3. For what I (and lots of other people, if they were honest) think is an utter joke, go to Google images and type in "rauschenberg white series". Honest people see these as blank, empty, primed canvases. Of course, the "art world" would tell you that you don't understand the work. It's bull shit.

    So much of the very high end (current) contemporary art world today is a complete fraud, with people working in concert to keep ultra high prices that way. They have so much invested, they can't afford to stop now.

    There have been some hair-raising articles in American art magazines about a consortium of ultra high end galleries, museums, auction houses, artists and collectors with the aim of keeping certain prices high. Can't let the bubble pop! (Sound familiar?)

    I just found the following documentary and plan to download it. I hope it's the story:


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