Friday, November 30, 2007
Though I try not to look back at trades that I made, I couldn't help but look at these two:
The circled amount is where I sold. I referred to this investment as a stupid stock trick. Yeah, I did my research, and I liked the story. Earnings did not come up to snuff (another good reason not to buy before earnings which I rarely do unless I feel like I have a really solid hunch), and the stock was sold unmercifully down on a downgrade. But I held on. The stock then was upgraded by another and hence the positive move. (Also a heavily shorted stock!)
Here's another. ASIA. Sold unmercifully down. I noted where I sold--I sold with impunity here.
As you can see, I have a real knack for picking the bottoms. ASIA also had heavy short interest.
The lesson. Remember, you have to respect your style, and you shouldn't MIX your styles half-way through. For my style, I should have had a reasonable stop loss (for these stocks, 8-10%) so that I wouldn't get to the disgust level (as you see here) and hit the eject button. Both of the above stocks were in my E-Trade cum Ameritrade account (my license to speculate account). It is a hair less than $20K after briefly grazing just above $23K.
Now I could have bought and held on with a much better result. However, what am I doing with that statement? I'm critiquing past actions with full information in the present. The information that I have today is not the information that I had at the time. Accordingly, I can only judge my decision based on the information that I had at that time I was making my decision. GaryK would refer to that as his "strict disciplines".
On these two items, I did not have strict discipline. I mixed styles with less than desired results. I should have either limited my original loss with a predetermined stop loss, OR I should have bought and hold. What I ended up being was a white-knuckled buy and holder that then capitulated. I think that it is like black jack. You have to be consistent about taking a hit on 16. If you sometimes take it and sometimes down, you skew the probabilities to your detriment.
Thankfully, I had the good fortune to have a little better discipline on this stock, SEED:
Rather than selling at the nadir, I sold at the apogee! That's not to say that this stock will not return to such heights. But the rise was nothing less than meteoric, and there were no fundamental reasons for such a huge move so I sold. On the contrary, I could have said that there were no fundamental reasons THAT I KNEW OF AT THE TIME, other than investor disgust, for MGPI or ASIA to be sold down. The trouble is, you and I will never know all of the fundamentals, for we will never have access to all of the information. Therefore, for my style, the stock price action speaks for itself. As Bill Cara is fond of saying, "we trade prices".
It is not lost on me that the meteoric rise in SEED was pure, dumb luck. You'll remember, I was moaning about selling too soon. I sold two tranches at $10 only to see it go up to $15 by the end of the day. My last tranche was sold at ~$14. That $10 that I was lamenting, looks pretty good compared to the current share price! It does look like it is carving out a bottom, though.
Yesterday I sold my UYG (double long financial). It was a very small position. I'm certain that I'll wish that I still had it in hand. But Bernanke could have delivered a lump of coal yesterday! I do have some Tyson (TSN) $12.5 Jan calls and some Wellcare (WCG) Jan $40 calls. Here's TSN. With grain and energy prices so high, the costs of these protein producers have increased.
Here's WCG. You'll remember that WCG had its headquarters raided by Federal officials. I bought some of this at $24 and flipped it at $40. I re-entered at $34 or so and flipped it again for a modest profit. I decided that I didn't want the common stock exposure, but I wanted exposure to the stock. Therefore, I bought these calls three days ago when the stock was at $36. There was news of renewed contracts, so the stock jumped again. (I'm having good karma on this one!).
Today I will be driving to Charlottesville to visit The Barboursville Winery, most specifically Palladio, their wonderful restaurant. I'm going up there with two of my very good friends--former KPMG colleagues. I've known them for more than 20 years. We always have a good time together--laughing until it hurts at times!. I'm sure today will be no different.
So I'll miss most of today's market activity which is not a bad thing. Mark is in the bed with a mild case of the flu. Hopefully, I'll escape that malaise.
I hope that you have a good day.
Thursday, November 29, 2007
Yesterday was an amazing day in the market. Powerful, explosive! Was anything different yesterday in fundamentals than it was different two days ago? No. For the most part durable goods was weak. That everyone was in a lather for a Fed rate cut and anticipation a great wall of liquidity washing over the market always makes me laugh. Don't fight the fed is a mantra that some use, but others have said that the market has fallen X% of the time even when the Fed is cutting rates.
But market psychology in the short term always trumps fundamentals (galling isn't it!?)--whether the mood is manic (greed) or depressive (fear). None of this was lost on readers who left comments on the last post. Such moves are not indicative of a healthy market, but rather an emotional market. My little book "The Psychology of the Stock Market" helped me so much in understanding some of these basic market tenets. If you are mostly short, you're going to go into a buying frenzy that you saw yesterday. Watch charts from 9:30 to about 10:15. You often see stair stepped increases only to level off. I attribute that short covering--when it is in stocks (or overall positions) that are heavily shorted and some news catalyst causes a Scooby Do "Rut roh!" moment. So yesterday was a Scooby Do rally!
The lines in this chart had been drawn for a while. It's the Dow. I found it incredibly telling--and I do not believe that it is coincidence--that the lines turned back almost exactly at 13325.
But there is such a seduction in such moves. Fear of being left behind, particularly when your paycheck depends on your outperforming, is very powerful. You and I are not driven by that fear--if we are, we should reconsider, for it means we've been seduced. I think that one of the most powerful concepts is that no matter what the market, there are always opportunities. If you missed yesterday's move, there are going to be sectors and stocks in sectors that will allow you to participate. But, if you are merely and indexer, then that is not the case.
I like to draw lines in charts. I don't profess to be good at it, or an expert, but I get by. For the most part, they have served me well--guideposts if you will for when I'm getting ready to screw up (or get screwed!). I showed you this on FMD in this post. The stock actually went lower than that. Breaking support is a big thing. Just because a stock is at a support or resistance level doesn't mean that it will hold--but if it doesn't, money can be made (if piercing resistance) or lost (if breaking support) that one could have reasonable fair warning. I did unload my position at a loss. Had I hung on longer, it would have been much greater.
But fundamentals always win in the end. If we are going to slow down, the time tested business cycle rotation will always play out regardless of what the fed is or is not doing. I would consider myself underinvested, but that does not cause me any trouble. My retirement account is up 18.5% ytd. I'm 92% cash now. I'm fine with that. I'll be quick to say that I underperformed the market last year because I was expecting this action a year ago! Oh well.
Tuesday, November 27, 2007
George Soros quote, “Economic history is a never-ending series of
episodes based on falsehoods and lies, not truths. It represents the
path to big money. The object is to recognize the trend whose premise
is false, ride that trend, and step off before it is discredited."
That quote really resonated with me. In fact, it appears to me to be the basis of the entire market.
I'm only now hearing some pasting of labels on this market as a bear market. Gary K is openly calling it a bear. He's not done that on the other two corrections. On the contrary though, Robert McHugh on Saturday's FSO thought that there was a bullish non-confirmation of Dow Theory. And, there's Richard Russell who is now calling this a bear market in his letter dated 11/23/07 to his subscribers. Jeffrey Saut relayed these comments here. I urge you to read--indeed print--them. There's a bit of irony in these comments in that Richard Russell who was initially calling for a correction earlier this year (as the bull market was long in tooth) initiated a "it's different this time" and capitulated believing that the bull could run forever. So pick a person and pick a position and act according to your pain tolerance!
If you want something that can run forever, get a hunting dog--they are built for endurance and exhaust their prey by persistent pursuit. Bulls aren't built this way, neither are bears. Neither goes on forever, though it is both seductive and dangerous to believe that they will.
All of the "things" that are now bringing this market down were known more than a year ago. That's how long it has taken the market to come to grips with the swirl of problems. It certainly was an important lesson for me to learn--and I think that is why the Soros quote resonated so loudly with me.
Just a hair over a year ago, I wrote this post about Marty Zweig's definition of a bear market. You might find it an interesting read.
I'm also reading some noise about stock buybacks. I hope that you will read Mish's article. I always thought it odd that company's would buy back their stocks at the top of the cycle when their share prices were at their highest. I've never believed that buying a stock back really helps shareholders. As a shareholder, I'd rather have a dividend--money in my pocket at a tax advantaged rate. Personally, I think that the stock buybacks were to manage earnings forward giving a slowing rate of growth. I would not be surprised to see some litigation around these stock buybacks.
Futures are up as I write. As Gary K states, a signature bear market is strong open and pitiful close! There's nothing wrong with being the hunting dog--be steadfast, keep your eyes open and nose to the ground. You'll find out if it is a bull or bear soon enough with your patience and caution--it cannot outrun you, but it can run over you.
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Monday, November 26, 2007
I was particularly struck by the segment on credit card safety and the stupidly easy way that hackers can get your credit card information. How? Wireless networking. The hackers can get rather easily obtainable software (which the safety expert driving Leslie Stahl around was able to do) and read the information through lurking in the parking lot. WAP is a safety protocol that has long been infiltrated by hackers. There's another protocol that is safer, but it is expensive. TJX's Marshall's stores was breached in a big way.
The Shakedown: This thought occurred to me last week, but it cemented with this 60-Minute segment. Your and my sensitive credit information is kept by third parties, yet somehow WE collectively are responsible for checking for breaches. Moreover, we get the privilege of paying for credit protection and identity protection due to information collected and mishandled by others.
I don't know about you, but I feel like it is THEIR responsibility to protect for this sensitive information, and THEY ought to offer such informational reporting (credit history) and PROTECTION at their cost, rather than making us responsible for it.
I certainly will be very selective about where I shop and what I use after seeing this segment. I'm beginning to resent the power of the financial services industry.
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Sunday, November 25, 2007
Friday, November 23, 2007
I mentioned that I had purchased a "natural" turkey. My husband and I agreed that we thought it tasted more flavorful--but we would really need a more rigorous study to confirm that conclusion! Nevertheless, the bird was beautiful. That 15 lb turkey was done in less than 3 hours. I never buy a bigger bird than that. It was plenty for 11 people. The ham was succulent. I had ambitions of making a glaze for it, but those were dashed on the rocks of reality of time and energy left.
My SIL said that her two favorite dishes were the potato and turnip gratin and the scalloped oysters. As I was prepping the dish, my SM and SIL ooh'd and aahh'd over the beautiful turnips that V_6 had brought. You would have thought I was pulling diamonds out of the bag! I also had collard greens/turnip greens with bacon and onion--a simple dish, but one of full flavor from fresh greens. My dad thought he had died and gone to heaven! (He's a Southern boy--GA and then worked his way north to VA!)
After dinner we lingered a bit with our guests. I put together a few plates for folks to enjoy something later. I just let the plates sit. I stuff what I can in the dishwasher--but that is generally full from the prep dishes. After the our guests departed with full bellies, we lingered with my two kids along with my daughter's BF. I had a glass of wine and my feet propped up. But it was nice to be in conversation with them. At 10:30, though, my body was crying out!
I went to bed but was really too tired to sleep. But, it was worth it. I'll not do any cooking for the next three days. We'll eat every scrap of leftover--then we'll go out to eat some Mexican food.
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Thursday, November 22, 2007
Happy Thanksgiving. This holiday is my favorite, for it is about giving thanks, not giving presents. We are complex beings. On this day, gratitude is highlighted. It's a time to reflect on our blessings--no matter how bountiful nor how meager--and being grateful.
We seldom think about what it means to truly celebrate a meal. A meal represents a successful harvest or a successful hunt. Our everyday lives are filled with working to earn money to pay for food and shelter or leisure time filled with digitized content or the enjoyment of activities that produce delight. Nothing wrong with that at all--it just represents how far we've distanced ourselves from life's hard edge. Many do live on life's hard edge. From that we must draw our own conclusions and act or not as we will.
We are far removed from when our own shelter, food and clothing were products of our own hard work. The quilt to keep us warm, the barn built with the help of friends, the successful hunt for a deer, rabbit, or game bird, the harvest of corn to feed the farm animals through a hard winter--each of these things were critical to survival. Each of these things could be withheld through the whims of nature.
However, you celebrate this day, I wish you great happiness.
Wednesday, November 21, 2007
Yesterday the market looked like an acrobatic flyer, though there was nothing elegant about the maneuvers. As I've come to learn, the market seldom conforms to anyone's expectations--yours, mine or opinion makers. I do have a few observations:
- Bear or buying opportunity? There are not many folks calling this market a bear market. Gary K is calling it such, and I've heard two traders on CNBC calling it such. That's 2 in the gaggle of folks paraded around saying that it is a unprecedented buying opportunity. Gary K is fond of saying this: "In a bear market you will get no help from Wall Street." His comment is true, I believe. Crystal ball? Bear markets are like recessions--they are only clear in hindsight. I don't know if it is a bear market or not. However, I suspect that the probability that it is a bear market is greater than the probability that it is not. I'm reminded of Young's excellent book, Five Blind Mice, where many mice are climbing over the elephant and conclude 5 different things based on what each is able to tactilely determine). Same for the market. Once can look at a discrete piece of it and conclude something very different from reality.
- Bernanke as Sampson? How funny when Bernanke started and it was perceived that he would be accommodative to Wall Street he was much heralded. Now he is much maligned. From hero to villain. How fickle the emotions of crowds! I suppose that he is Sampson like in his positioning himself between the two pillars of the "Fed Put" and liquidity and is pushing them down. All of the derivative instruments have produced synthetic liquidity that has emasculated the Fed.
- The Fed and Dante's Seven Circles of Hell: I think that the Fed will serve as purgatory for these CDO's that need a place to stay and receive a little cleansing and redemption--redemption in the literal and figurative sense. Literally, because the institutions have to redeem this garbage. Ben Bernanke is calling, like in that classic movie, Monty Python and the Holy Grail, "Bring out your dead!". The institutions are slogging through the mud of the credit markets, laboring under the weight of these huge burlaps full of CDO's--some of them dead, and some of them not quite dead yet! Ben takes the load, throws them a few pence and takes the stuff to do penance. Who knows how these institutions are going to repurchase this stuff. But the point of purgatory in the figurative sense (in Leisa-land!) , is that redemption will be found. In time the credit markets will calm down (well, maybe), and the pricing mechanism lubricated so that they start working again without the fear of locking up. At that time (should we live so long to see it!), the institutions can repurchase. The institution's ability to repay will determine how much you and I've purchased with our taxpayer dollars!
- Yankovich on CNBC (bearish trader) is looking for Dow 12K.
- Oil: I still expect this price to crash. Much like Dow hitting 14K, oil hitting $100 will be a psychological climax, after which there will be a deflation and a cigarette or two smoked afterward. I think that it is the last flailing of the commodity bull run prior to an intermediate correction--just as we saw happening in the China stocks.
Tuesday, November 20, 2007
I started early today and polished off my list. But the very first thing that I did today was prep the venison tenderloins that Valvoline_6 was so kind to bring to me. I couldn't find my last recipe which I loved so well, so I winged it a bit. I combined red wine vinegar, Yoshida's Gourmet Sauce (soy based sauce), about 4 large cloves of garlic mashed with knife, some Grey Poupon mustard and a generous sprinkling of Kosher salt. I ensured the tenderloins were covered and let them marinate (in fridge) for what turned out to be 12 hours. I had a visiting neighbor. He's single. I often invite him to eat
with us or give him leftovers so that he'll have something easy to
fix. I gave him a portion of one of the tenderloins for his dinner.
No mess, no fuss, just slap that baby on some heat.
I cut the silverskins (the muscle encasement) off and then sliced the tenderloins into 1" pieces. In a small saucepan, I combined about 1 cup of water and beef base and 1 cup of wine. I also threw in a couple of sprigs of Thyme and about 1 TB of red currant jelly. I reduced it by 1/2.
I salt and peppered the venison medallions and pan seared them in just
a bit of olive oil. I used my cast iron skillet. I cooked them to
rare with warm center. They were exquisite. If I hadn't prepared the
meat with my own two hands, I would never have imagined much less
guessed that it was venison. The marinade really infused the meat with a wonderful flavor (in addition to drawing out blood) and the wine sauce was the perfect accent.
The wine is what I enjoyed with the venison a 2000 Chateau Fonseche (Haut-Medoc). Total Wine Warehouse these great coupons for $5 off on Bordeaux wines. I did my homework and bought well-reviewed wines right at the price point cut off! None of the wines cost more than $22 per bottle. $5 in wine puts you into a very different level--so coupons such as this get you alot. They've never run that $5 coupon again insofar as I can tell. This wine could age a bit more, but it was very pleasant. I raise a glass now to toast Valvoline_6!
The squirrel portion of this post has nothing to do with food, but everything to do with today's market! Gap up, plunge down, torpedo up and settle modestly, but importantly above Dow 13K. Banks stocks were pummeled.
I closed my FMD. It was getting too close to a cliff. The cliff held, but not with me hanging on it. I also closed my stupid stock trick MGPI. That darn stock can go to $20, and I'll be happy not to see it. I also closed WZEN. I did close DUG and SMN. I think that we'll bounce, and I'll re-enter those positions.
The financial stocks may be carving a bottom. FMD still has good fundamentals, but this is a case where owning a good stock in an out of favor sector is painful.
I didn't spend much time with the market, but I did a 5 minute flip of RIMM profitably. Poco profit, but profit.
I hope that your day was good.
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Monday, November 19, 2007
I have this dish that I like to make a Thanksgiving. It's a turnip and potato gratin with a horseradish cream sauce. The turnips and potatoes are sliced very thinly. You place alternate layers of potatoes and turnips with salt/pepper/nutmeg. Then a sauce of chicken broth, cream and horseradish goes over. I think it is topped with Fontina cheese. I'm sure that some of you are turning up your nose. Trust me it is delicious. (But I don't trust people who tell me that "their" beets and "their" okra are delicious--so if you really hate turnips, you can throw trust out the window. I still cannot eat either beets or okra--my dad grew both and I have many unpleasant memories of being forced to eat them.)
Now, if you've never mashed turnips and potatoes together, I hope that you'll consider giving it a try. Turnips had a sweetness and cuts the starch a bit in the potatoes.
Such a small world that we live in. And what a treat to meet a reader in person. (I won't spoil it and talk about the market!)
I'm getting ready to go into T-G prep mode. I have to perform an EPA cleanup of my home and shop for and prepare a 'passle" of food. There will be eleven of us. Modest size compared to some gatherings people do!
Feel free to share your own T-G plans, memories foods. It's my favorite holiday. I have much to be thankful for.
Saturday, November 17, 2007
Above is a picture I took this a.m. It is the creek behind my home. I think the beavers have built this small, partial dam. Unfortunately, the light was not very good, but, it's a decent enough picture to share.
I've been bit by the dog-transport bug! One day, I'll actually take my camera along and post some pictures for you! On Saturday, I drove from Richmond to Springfield. I had two kittens who already have an adoptive home. I also had Sparky, an Australian Shepherd/Husky mix. He was about 1 year old. A sharp looking fellow, I tell you, and a sweetie pie. He's the type of dog that should go to a single guy, for every female will be oohing and aahhing over the dog!
I also had Maizey. A beautiful lab mix, though a bit smelly. She had just weaned her puppies, and she was off to a foster home. Both Sparky and Maizey were wonderful, loving dogs. Maizey was particularly needy--wanting closeness. At Springfield, Sparky met his adoptive parents. He would have gone with Charles Manson. Luckily, they screen folks well on these adoptions, so Charles Manson would likely not get approved. (Somehow all of these pet names end in the "ey" sound!),
It was a bad karmic day for me though. We have a bit of a car lot here. I have my 1996 Oldsmobile Aurora. I love that car. It has a Northstar, small block V-8 with dual exhaust. And, it is so beautifully appointed inside. A really nice, luxurious, high-performance car. It's the first car I ever bought used. I will drive it until it can no longer hoof its way down the road. As I was loading up the Oldsmobile, I got in to find that my keys were not in it.
I live in the country. If you want to come and steal one of my cars, the keys are in all of them except my daughter's. She hoards hers in her purse. My daughter had to use my car because her 2001 VW Jetta VR6 was in the shop. So naturally, as is her hoarding way, she put my keys in her purse, and she happened to be at work. I was left with my Thunderbird--2 seats. The other two suitable vehicles were in use by my husband and son. The t-bird is not much good for transporting dogs. I also have more women come up to me and tell me how much they love my car. I laughingly tell them it is my boob job and face lift--meaning my "middle-age crisis car"!. I also get older men who come up to the car because it reminds them of the T-birds of the 50's. It's very sweet, and I really enjoy talking with these nice people.
My daughter's Jetta is really nice: it's quick, handles fabulously, and there are no blind spots. it has leather interior and premium sound system. We try not to spoil our kids. We're ordinary people. My deal with my kids is that I'll match whatever they save towards their car. This car was much discounted. It's a salvage rebuilt. A salvage rebuilt is a car that has been bought from the insurance company (which labeled it as totaled), and it has been repaired. It has a title, and the title very clearly states, "salvage rebuilt." A very lucrative business. So we bought this car with 27K miles for $11K and the book value was about $18K. So we received a pretty good car for not alot of money. We took it to our friend who is a mechanic. He said we would not be sorry to own this car. Unfortunately, with a SR title, it voids the warranty. And VW's seem to have a ghost in the machine and every repair and part is quite expensive. Because this car needed a new transmission, that ordinarily would have been covered under the warranty, we've spent enough in repairs to eat up the price difference. The new transmission cost about $5K. I've NEVER spent that kind of money on a repair.
So I drove my T-Bird to my daughter's work and handed her the keys with clear instructions that she was only to drive home. The Jetta was an able dog transport vehicle. But I was getting off to a bumpy start and had to hurry a bit so I wouldn't be late. At my destination in Springfield, I managed to lose my distance glasses. I think I had taken them off to read something and tucked them in the front of my shirt, as I generally do. I'm sure they fell off when I was bending over and handling the dogs. I looked and looked. No glasses. Luckily I had my prescription sunglasses, and it was still light.
But I arrived home safely and happy for having done a good deed. I hope you had a relaxing weekend. As you can see from this post, I'm refraining from market commentary for this weekend.
Thursday, November 15, 2007
By Jamil Anderlini in Beijing
Published: November 15 2007 20:15 | Last updated: November 15 2007 20:15
China’s commerce ministry warned on Thursday that a slowing US economy would trigger a drop in Chinese exports that would mark a “turning point” for China’s rapid economic growth.--------------------------------------------------------------
The market is much like a soap opera--the story line is ever evolving! As I've mentioned here before, I did not believe that the global economy--most particularly the Asian markets which so heavily rely on the US consumer--has de-coupled from the US. The article above (I'd be pleased to e-mail it to you) lays that out more clearly than I've seen it to date.
You'll remember, of course, that the ongoing themes of (1) global economic boom; (2) liquidity, liquidity, liquidity; (3) the unflagging American consumer; (4) low interest rates; (5) low inflation have been systematically taken to the woodshed and shot. Here's the scene of the crime.
I regret that I've not benefited more from this market downturn; though I'm grateful that I was not more heavily invested. GaryK is using the "B" word for bear market. Given the steady cracking of the pillars that have kept this bull market alive, I have to believe that we are in for more pain. I suppose the good news is that there are sectors that have already had their personal bear markets such as homebuilders and some retailers.
I kept my FMD, which is much underwater (I bought it at $37, and it is at 30 and change). I think I became emotionally attached to it. I know better. But knowing and acting are two different things. I knew that there was risk, but it has good earnings, good growth. I think that because I had so few longs, I felt that it was okay to hang onto it.
Gold stocks are getting pummeled. Our friend, MarkM, foretold that. (MarkM, we are keeping that woodshed cleaned out). I did sell all but a smallish position in WGDFF into strength. I still have my speculative KRY position. I sold SFD today. The food stocks are getting hit so hard with rising input cost issues. Even though SFD has come down over the last few weeks and then climbed a bit, I really didn't wish to have too much exposure. The loss was only about 2%--less than if I had sold it last week. My bright idea on MGPI was another money loser! I closed my RIMM puts out last week. I hate holding beyond the Friday BEFORE the week of expiration given the time value deflation. Those were $100 NOV puts. When it was trading at $118, and I still had some value left, I closed it out. I didn't think that it would get any closer to $100. Wrong! Sigh. It was still the right decision to sell. I have the benefit of hindsight now.
I did pick up a DUG (Ultrashort Oil and Gas) earlier last week and SMN (Ultrashort Basic Materials) this week. Small positions-200 shares each. My thesis is that commodities would be the last to fall. They would likely fall due to slowing 1st tier nations slowing and that would lead to BRIC slowing. I still agree with the commodities supercycle--who doesn't? And because of that there are lots of folks to sell to, but who is really going to buy now and these valuations?
I do not believe that the Fed's injection of liquidity will do much to float boats, but rather bail out boats. I think that there is a distinctive, not nuanced, difference between the two.
There seems to be a souring in the reception of Ben Bernanke. I can think of no worse nor no more difficult job to have.
Recently we bought a Garmin GPS. It's terrific. So much so that Macy chewed the antennae and rendered it inoperable. We had to get another one. As we were using it this weekend on our trip to the Outerbanks, it occurred to me that this ought to be integrated into phones. I read this Bloomberg article that notes the same thing. So navigation, web browsing, music and just plain ole talking will all be resident in phones.
It will be interesting to see how all of the players (Nokia, Apple, Rimm, Palm, MS) integrate these essential tasks into their products.
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Maple Pecan Chocolate Tart
½ cup butter, well chilled, cut in 8 pieces
5 tbs cold water
2 tbs sugar
2 tbs ground pecans
1 egg yolk
½ tsp salt
1 ½ cups unbleached flour
3 ounces unsweetened baking chocolate
3 tbs unsalted butter
3 tbs water
1 tsp instant coffee crystals
1 cup light corn syrup (substitution ½ c maple & ½ c light corn syrup)
1 tsp vanilla
½ tsp maple extract (consider omitting and replacing with maple syrup)
pinch of salt
2 cups of pecans, coarsely chopped
2/3 cup sugar
16 large pecans
For Pastry: Coarsely chop butter in processor using on/off turns. Add water, sugar, pecans, yolk and salt and blend using 5-6 on/off turns. Add flour and mix just until dough comes together; do not allow dough to form ball. Gather into ball; flatten into disc. Wrap in plastic and refrigerate at least 2 hours (put in freezer for quicker processing). Can be frozen up to 1 month.
Roll dough out on lightly floured surface into circles 1/8’ thick. Fit into 11” tart pan with removable bottom. Trim edges, leaving 1: overhang. Fold overhang to form double thickness on sides. Press dough into pan, extending crust ¼: above edge. Flue edges. Pierce bottom and sides using fork. Refrigerate 30 minutes. Position rack in center of oven and preheat to 400F. Line shell with foil and pie weights. Bake until shell is set: 12 minutes. Cool crust completely before filling.
For Filling: Melt chocolate and butter with sugar, water and coffee crystals in a double boiler (or microwave). Cool to lukewarm. Preheat oven to 400F. Blend eggs, corn syrup, vanilla, maple extract and salt in large bowl. Stir in chocolate mixture and chopped pecans. Pour into crust. Arrange 10 pecans around edge and other six in middle. Bake until filling is puffy and set: 25 minutes. (Can be prepared 2 days ahead. Place in cool oven and heat 300F 15-20 minutes)
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Wednesday, November 14, 2007
First: When I was questioning Fidelity about the default for my retirement brokerage accounts, the automatic default is FDRXX--Fidelity Cash Reserves. With all of the dubious investments to goose interest rates, I became very concerned about the quality of what is in these Cash Reserves. Here it is from the prospectus. I've highlighted the investment risks. These are all things that can lose you money.
Cash Reserves seeks as high a level of current income as is consistent
with the preservation of capital and liquidity.
Principal Investment Strategies
· Investing in U.S. dollar-denominated money market securities of domestic
and foreign issuers and repurchase agreements.
· Potentially entering into reverse repurchase agreements.
· Investing more than 25% of total assets in the financial services
· Investing in compliance with industry-standard regulatory requirements for
money market funds for the quality, maturity, and diversification of
Principal Investment Risks
· Interest Rate Changes. Interest rate increases can cause the price
of a money market security to decrease.
· Foreign Exposure. Entities located in foreign countries can be
affected by adverse political, regulatory, market, or economic developments in
· Financial Services Exposure. Changes in government regulation and
interest rates and economic downturns can have a significant negative effect on
issuers in the financial services sector.
· Issuer-Specific Changes. A decline in the credit quality of an
issuer or a provider of credit support or a maturity-shortening structure for a
security can cause the price of a money market security to decrease.
An investment in the fund is not a deposit of a bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. Although the fund seeks to preserve the value of your investment at
$1.00 per share, it is possible to lose money by investing in the fund.
To be clear, I'm not suggesting that losses are imminent, but I did want to highlight these risks to what you think might be "safe" assets.
Second: When I called Fidelity, unfortunately I talked to someone on the trading desk that knew less than I did. That was not comforting. I received two pieces of patently wrong information.
- I was told that the NAV (net asset value) would never decrease below $1. That's not true, as you can see from the risks above. In fact, it says this very clearly in the window on my screen as you can see here.
- After I pointed out the error, I was then told that SIPC would protect me in the event of a loss. SIPC (and I urge you to read about SIPC here). I informed him that SIPC was only to protect me in the event of institutional failure.
My conversation with Fidelity is a reminder that you MUST educate yourself. Whether it is a health, financial, personal, legal matter, you absolutely MUST become familiar with the issues. I've worked with professionals (insurance, lawyer, accounting) my entire career. Though they were the "experts", I was the business-side expert--and I had to have a command of the prevailing issues to educate the professional as to my business. YOUR business, IS your business. Educate yourself about your risks. When you interact with a professional, you will get a much better outcome.
Now, regarding brokerage failure. With the E-trade scare about solvency issues due to their foray into subprime, I'm electing to move my account. I learned about this fear while watchint CNBC at the beach. I was very concerned, but I knew about SIPC protection. But when you have securities held in a margin account, you have a lesser claim position. I need to study further the same link that I gave you to understand my exposure. I'm not futzin' around. I opened a TD Ameritrade account. Hopefully, I will have no issues with this transfer.
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Tuesday, November 13, 2007
We stayed in Avon. The "development" was named Kinnekeet Shores. To the left is a picture of the home that was rented. I took the picture from the sounds side (as opposed to ocean side). The home, as many of them are, is quite tall so there are lovely views of the ocean and sound side--stunning sunrises and sunsets! It was nice to be away from the market. I did watch some of the action yesterday. When I went to my p.m. nap, the DOW was up 90+ pts. When I woke up, it had an ugly close! More upsetting was the news on E-trade. I'm closing that account and opening an Ameritrade account. This subprime is taking out more than a company or two and an executive or two.
The grass area represents as rather robust wildlife habitat. As we walked about the shoreline, we could see deer tracks as well as racoon. We did see a very large buck and a couple of does milling about this area. I was unable to get a picture that you could see easily. But you can just make out the buck's haunches on the far right of the inner pondish area--in line with the tree that you see at the big-water's edge.
Now here's a print that looks to me like a "cat"--I'll have to check and see what is local to that area.
(I have since done some research. Since cats retract their paws, then this is unlikely to be a cat print. I don't think it is a dog print.)
Thank you for your comments on Herm. The timing of our trip helped soften the blow--I wasn't straining to hear his call. It would have been a great joy to hear that he returned. I know that he is gone for good. Though he was young, he lived the best'est life a cat could live. He was loved and well cared for. Unfortunately, he was a hunting, killing machine. I'm quite sure that he was a victim himself.
We have a rather active owl population. I don't know that it was an owl, but that is a best guess. Herm is in a longish line of disappearing pets between my neighbor and I. He's had about 4 cats and a maltese disappear. I'm missing 2 cats--Theo/Herm. They were brothers. Tim (neighbor) had the mother and kept one of the kittens, Max, who was Herm's twin. Max was a victim of bad dog attack. Tim learned of it through an acquaintence who lived about 1 mile away, but about 1/2 mile as the crow flies. The acquaintence mentioned the bad dog and the cat it had killed and drug in her front yard. The description matched Max's.
The maltese was out early in the a.m. He never came home--and he didn't venture anywhere but around his property. Likely nabbed by a hungry owl. Theo or Herm either scrapped with something on which they were on the losing end or.....
Life's not very pleasant when you look at it closely!
We did see some feral cats on the outerbanks as we stopped for air and to put air in the tires. The woman said that she feeds them. The Humane Society gives her food. They also trap and alter the cats, and then bring them back. A very responsible and humane thing to do!
Saturday, November 10, 2007
Most mornings I'm awakened by Herm. Herm is my stunningly lovely, super, cool, neato black and white cat. He was about 2.5 years old. He is either inside and wants to go out, or if he outside, he wants to come in. He always starts out softly; however, if your response time does not meet with his expectations, then his mews becomes yowls! Since Wednesday, our mornings have been silent. Herm was last seen Tuesday evening. I suspect that he became part of the food chain. Herm, being the color of the night, was a creature of the night. Owls and foxes are similar nocturnal predators. I'm wondering if he became a midnight snack.
I don't write this glibly--I awoke this morning to the false hope of Herm's voice. Funny how your mind plays tricks. Last December, Theo disappeared. For a couple of months I would "hear" his voice. The sub-conscience is ever hopeful! Herm had this particular habit of choosing a spot for repose. The spot would be one that he would go to regularly for a week. Then, he'd pick another. My desk was his spot week before last. I was glad to have him near for that time.
These past 12 months have been particularly hard on our family with pet loss and injury.
Wednesday, November 07, 2007
Gary K sounds somewhat ominous. Why? 1490 was taken out of the S&P 500. Big cap tech as been THE place to go, but CISCO provides an good, but not GREAT report. Cisco's earnings report is a textbook failed expectations.
I always had a difficult time understanding how a company could report a terrific or horrific report but the stock would do the opposite. The answer is simply this: expectations. Plus--how "crowded" the trade is. Too many folks leaning the same way sinks the ship.
Regardless of how your portfolio performed today, I hope that you remember that you are never your portfolio. You are never the gain; you are never the loss. So any arrogance or shame you feel regarding your portfolio performance is meaningless. Who you are always transcends your bank account. If you do not understand this, you have much work to do in this lifetime. That's not an excuse to be careless with your resources. However, it is every reason to keep things in perspective in the even that you f*ck up. It means that you are human.
If you take anything away from this blog, I hope that you take this away.
Tuesday, November 06, 2007
I'm not sure why food is important to me. I think that it is a creative outlet as much as anything. Though I worked horrible hours in a stressful career, I fixed dinner every night. Sure, I stopped and got chicken once a week, but for the most part, we had a cooked meal. It's funny, but most of the children that my kid's know eat crap. We eat roasted chicken, pork chops, homemade hamburgers, pork tenderloin, barbecued chicken, salads, fresh greens and beans. My daughter brings home boys that live on fast food. I serve stuff they do not recognize; they will not eat.
I get no greater joy than feeding people something that they would not otherwise make themselves. The big foodie holiday--Thanksgiving--will soon be upon us. I have had it at my home since 1985/86. Mark and I would have 2 T-G's and I decided that my Mom and MIL had cooked enough, and I would do it for them. They did not mind. It's really much work. It takes me a good 2.5 days of work. I do notice now that I'm older that it' is much harder to do. Cooking is very physical. You have to stand up, move around, lift, chop, THINK! I did give up making my own bread a long time ago. Now, if I even have it, I will do croissants from Costco. But, I may this year make Armenian dinner roles. Yes, I think that I will.
I try to have a core menu--to give people an anchor so they don't feel like they are tossed out to sea. But I also like to surprise folks with new side dishes, or a different dessert. Coming to my house looking for pumpkin pie or pecan pie? You will not get it. But, you might get a pumpkin cheesecake, or a frozen pumpkin torte, or a maple pecan chocolate torte, or pumpkin bread pudding creme brule! Want choices? I'll disappoint you again. I make only one dessert. And it is always divine. and I promise you it will be something that will send your taste buds into the everafter.
I've had one spectacular failure: Brussel sprouts with roasted chestnuts in a garlic cream sauce was one such whimsical dish. I burnt my fingers roasting the %$#!$^%^ chestnuts. I hated the dish. Truthfully, that is the only loser side dish in twenty years. Should my investing be so lucky!
My core offerings will be turkey, ham, scalloped oysters, tart cranberry sauce and cornbread/sausage dressing. I ALWAYS serve these. I brine my turkey. I DO NOT cook the thing all day. I roast it to perfection in 2.5 hours. I rub it with butter, I roast it for 45 minutes on 450, and then it gets turned back. I use a meat thermoter. The pop ups will overcook your bird. The skin is seared and everything is delicious. No basting--it doesn't work. Squirt water on your skin. Are you getting anything in your muscles. That's why you need to brine. But you have to be careful or you'll kill everyone if you do not keep your turkey cold enough in the brining process.
Rather than a spiral ham, I'm going to get a Smithfield ham. I own the stock'; I'll support them. You have to do the opposite with a ham. You have to soak the damn thing (after stabbing it with a knife in a scene reminiscent of "Play Misty for Me", for a couple of days to take the salt out. The last time I had a country ham was about 10 years ago. I put it on the gas grill in a mixture of vinegar/water. I don't know where I found that recipe, but it was the most awesome ham we've ever had--flavorful, moist and just the right amount of salt.
If you ever get wild game, do the same thing. If someone brings you some deer, do not turn it away. Honor that deer's life by serving your family a lovely venison dish. If you soak it in vinegar and water you will get the blood out. You just e-mail me, if someone plops this on you and I'll help you make a terrific meal for your family.
I'm not going to be be adventurous on dessert. I'm going to make a maple pecan chocolate torte. It's graced my table a few times over the last 20+ years. It's divine. I serve it warm with vanilla ice cream. It's a pain in the ass dessert. The crust is so rich and buttery it is very difficult to handle. You will curse. But your guests will eat it silently, savoring every rich bite.
I've been getting Bon Appetit for about 22 years. I love it. I read it cover to cover--like a man reading a girlie mag! I always fix something from the current year's T-G issue as a side-dish. I have to say that I'm finding a brussel sprouts with carmelized onions looking very tasty! I rarely do sweet potatoes. But I've made a turnip and potatoegratin with a horseradish cream sauce that would curl your toes. A couple of years ago I had a corn and grits gratin with carmelized onions. Fat city. Yummy beyond imagination. But these side dishes are not frequent visitors each year. They are cameos that come to the T-G production at very irregulary times. Last year I had fresh green beans in a scallion bacon dressing with cranberries and goat cheese. Ahhhhhhh!
So within the next couple of weeks, I need to make final decisions and develop a logistical plan. But there is not greater joy for me than to do this. It truly is a labor of love.
On Saturday I will be traveling to the Outerbanks. So there will be silence here for a couple or three days. More posts between now and then. I wanted to share my love of food with you today.
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Monday, November 05, 2007
As I awoke this a.m. and was enjoying morning coffee with snuggling puppies, I noted that WCG was trading at $33. Though I did not see their earnings (which were quite robust) at the time (they did not release until 7:24 a.m.), I did see some color on the investigations.
You may recall that this stock was halted and tumbled from $120 down to $60 and then down lower. I closed out at $40 this a.m. Oh, this stock may go back up to $60--or higher--but I don't understand the issues. I'm perfectly happy taking the money and running.
I'll go to my grave with fundamentals clinched in one wrinkled cold claw and TA clinched in the other! I believe that they are both critical. Why? I do not believe in efficient market theory. IMV, the market has proven a very poor discounting mechanism--it did not understand and did not discount CDO crap appropriately. So much of efficient market theory (I'm sure that Russell will correct me) is based on rational behavior of market participants. There have been studies that show that human beings do not make rational decisions. That makes sense doesn't it? If they did, there would never be asset bubbles nor would we have market panics.
The interplay between TA and FA though is pretty straightforward. The stock price incontrovertibly reflects what the market currently thinks about the value of a security. The market encapsulates the current understanding of the fundamentals and the hopes or fears facing the stock. The risk/opportunity resides in the delta between the technicals/fundamentals as the market currently understands them and the "true value".
It almost becomes a philosophical discussion--admittedly I'm ill-equipped to state it appropriately. It's the difference between relative reality and objective reality. I was struck by something that I read about a hedge fund manager. Recently (maybe Marketwatch?)...I wished I had written it down to give proper attribution. The HF manager said that he bought when there was uncertainty and sold when the uncertainty went away. That's where he saw opportunity. I suppose this is where "sell the news" originates.
To argue TA v. FA as an "either/or" is not productive. Recognizing the attributes and failings of each--and exploiting the attributes while reasonably protecting against the failings is important. Both are tools in the tool kit--and when fundamentals and technicals line up you are bound to reduce risk in your trade/investment decisions.
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Sunday, November 04, 2007
I forgot my sister's birthday. It's November 2. I never forget her birthday, but did so this week. My sister is 14 months younger than I am. It lead to a tumultuous childhood--that's just too close in age! I'll blame it on my cold. Now my son has it. My husband never gets this stuff--but he did get chicken pox as an adult when my kids got sick with it (prior to the vaccine) about 15 years ago. I think that was revenge enough for all of the other ills that I and the kids' have come down with that he escaped.
It's one of those lovely Fall days. I have a few pictures to share. The first picture is the fence. It might as well be the Great Wall of China! I've shared with you our trials on this fence. We live on a private road, which you see here. There are only three homes beyond ours--the cul de sac is just beyond. The area to the left is our garden area. The fence is in front of our "yard". The area beyond the telephone pole is woods. There's a path just beyond there, where you see the first of the longest tree shadows. Daisey happened to be in those woods and jump from that path onto the road. Yes, the wire you see with the little orange flags is electrified. We extended 3 strands of electric wire to block the path. We had to switch out the electric charger, for dogs, to something more powerful as the dogs did not seem to be phased by the smaller charger. My neighbor let us borrow his. We've had a lesson or two already. It does create a very effective psychological barrier.
So far, all has gone well. I also have been using my "training" collar. It is part of an invisible fence system. We felt that we needed a more "solid" boundary, which is why we put up the board fence. Because of the drought, the ground has been too hard to consider putting an invisible fence wire into the ground around our 6.5 acres. Nevertheless, because Daisey was getting adept at getting around the fence, and because she does not listen well, I elected to put the collar on her for "training". The training part is a hand held device that administers a tone or shock. The *minute* I put the collar on her, it was evident that she had been trained with a remote collar. She turned into a very attentive and obedient dog. All she has to do is hear the tone. I've not shocked her. The last couple of days, I've had her outside without the collar, and she is attentive and listens. It is important for me to (1) give my dogs as much freedom as possible and (2) be responsible for both their safety and that of others.
A dog and her ball. Macy has an obsessive compulsive disorder with her ball. I use this obsession to gain control over her--Now that she is older (16 months old) she is doing a better job listening. She is the evildoer that taught Daisey to chase motorcycles. My neighbor's Harley is a loud, obnoxious bike. Macy is so quick, she can outrun it in short distances. Bad, bad, bad. (But she is so cute!)
The fence, then, was originally for her. She's not gone beyond the side boundaries. Without the fence, she could triangulate very effectively--and dangerously. But in fairness to obnoxious HD's, the UPS truck, and other diesel trucks--really, anything loud and or strange--has been a target for her. As the vet told me, she is all muscle, and if the HD had hit Macy rather than Daisey (Ms. Bony Legs), the outcome for the HD would have likely been worse. Daisey is mostly fully healed, though I suspect that she will have a bald spot or two for some time to come.
I've never been home much. Now that I'm home more, I realize how much I've missed. I have a modest goal in my trading account to at least make as much money to cover what is taken out in bills. I've been successful in doing that--but I'm mindful that if I were working, I'd be making exponentially more! But, having this space in my life has been far more valuable than dollars. I see, too, that my family is more relaxed. I can actually take care of them rather than just provide money without care. That may sound weird to you, or perhaps you can relate. But truth be told, without that money, I wouldn't have had this "luxury". I know that this is "incubation" time.
In general, I think that I've made good use of this time. However, I have this great shame that for so many years--really most of my adult life--I was so ignorant of all of the *stuff*. My father would talk about the Fed, inflation, market stuff and the like, and I always thought that he was a little nuts. But the more that I read, and the more that I come to understand, is that he's not and wasn't nuts. And when we think about dangerous people and dangerous ideas, these are really not dangerous to anything but status quo. And status quo is merely a stupor that we too easily lull ourselves into.
Saturday, November 03, 2007
The driving is easy, but the handoffs are hectic. Walking, watering, changing paper in cages for the puppies. I had 1 grown dog, 2 7 mos old pups and 7 puppies. The puppies were in crates. The other dogs were on the seats. They slept the entire 130 mile trip to Fredericksburg. When some of the puppies would whimper, I sang to them. Thankfully rather than howling they slept.
I missed my book club. I've been fighting a cold and feeling under the weather this week. I had committed to this trip, so I had to give up my book club. I didn't have enough 'oomph' to do both in one day. I think it is only the 2nd or 3rd one that I've missed in more than 10 years. But I'm feeling so much better than just a couple of days ago, so the worst is over.
Russell made an excellent point on my simplistic model. ON Financial Sense Online. You can listen to this week's broadcast here. Puru Saxena speaks to Russell's point of inflating one's way out of debt. Also, the currency devaluation is a way to help the trade deficit. Doesn't really help the average person who sees food and energy as well many other necessities increase in double digits. Milk is 50% higher than it was a year ago. Many other foodstuffs have seen 20-30% increases.
I always listen to the first hour of FSO each Saturday. They rotate guests, so I feel like I several points of view over the course of time.
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Thursday, November 01, 2007
I've included my e-trade account. It had climbed to as much at $22K. But, I had a speculative bet on YHOO (and October put), and that large red line RULWT was my put on RIMM. Though I've "covered" the loss by trading RIMM in my other account, it still represents a loss in this account. It was my "bet" on a market downturn.
I added a couple of positions. All speculative. MGPI makes wheat gluten and other food products. Their stock has been pummeled. But I noticed that it was finding some footing. I'm also believe that they may see increased business from the Chinese wheat-gluten fall out as they are active in this area and saw immediate increases.
I also bought some WCG--Wellchoice. Yes, it could go lower, but this is speculative. This stock is a terrific example as to why having all of your eggs in one basket or failing to take profits into huge runups can be detrimental. The Hirsch brothers have a mantra at the end of all of their newsletters: Always sell half on a double. That's prudent advice, and that gives you house money. House money is always good!
My gold stocks are "house" money. I did trim EGO. I'm worried that the Turkish mine issue may not get resolved and the stock might move down. But I made a nice return for a short term holding. I did buy some KRY. VERY speculative. House money at this point so I'll let it ride.
The GDP strength last quarter surprised, particularly given some of the negative comments in earnings for quarters going forward.
With oil and now heating oil going up as high as it is, there are going to be many people who will be unable to heat their homes . I remember two or three years ago to fill a tank cost about $700 or so dollars. One of our staff members was undergoing chemo. She was a grandmother and supporting her daughter/grandchildren. She was missing 2 days a week--one for the treatment, which she had on Friday and Monday's because she needed to recover. She was strapped. I had a staff member find out where she got her heating oil. I called the company and had them fill it up. Anonymously. She was proud, and she would have been embarrassed. The point is that to fill up a tank costs a lot of money for people on fixed or reduced incomes.
Tuesday I asked my daughter to get some Halloween candy. She bought $17 worth of candy--two large bags from Sam's. Oh, it's the premo stuff--Reese's, Hershey bars, Almond Joy. We had 7 tricker treaters last night. I'm awash in candy. I had an Almond Joy with coffee this morning. Not good for the waistline but wonderful for the sweet tooth.