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Krypton--you still in FMD? I know I'm out, though I may still re-short if I can get the borrow. Then again it's a pretty crazy market right now and a name like FMD is prone to massive whipsaws so it's not the most attractive investment. Anyway, I probably shouldn't be doing this but here's some free research from a sell-side shop today.

I have over 100 tickers, and just started step 2, so it'll take at least until the middle of next week to finish them all for earnings report Q4 2007..

My 5 steps...

1. Compile list of stock tickers
2. Gather financial data
3. Input financial data into financial model
4. Analyze financial model results
5. Trade on the results

Thanks for the in-house report. A lot of qualitative analysis in there. We'll see if the intrinsic strength model agrees with the bad assessment your shop researched. But having bought FMD right at the $12 mark, the volatility means nothing because I've gained as much as 50% on the position.

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Originally posted by venomX I don't think the US economy will go into stagflation. Stagflation is a pretty extreme condition. Surely the US economy will go into a mild recession, but to say that this mild recession is going to trigger stagflation is being overly pessimistic I would think.

Mild??? Are you kidding?

Have you been reading what Bernake's going to do?

1.25 % drop in two weeks and a statement that he would keep releasing money until the economy corrects.

You know the last people to use money to print thier way out of debt?

They were a proud, proud people, liked to wave flags a lot, and were smarting from a millitary defeat (yes, I'm going to call Iraq a defeat now.)

...

I'm sorry, I'm being alarmist, we can always track how much money is out there with the M1, M2, and M3 data that the fed... oh, never mind.

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Originally posted by atbell Mild??? Are you kidding? Have you been reading what Bernake's going to do? 1.25 % drop in two weeks and a statement that he would keep releasing money until the economy corrects. You know the last people to use money to print thier way out of debt? They were a proud, proud people, liked to wave flags a lot, and were smarting from a millitary defeat (yes, I'm going to call Iraq a defeat now.) ... I'm sorry, I'm being alarmist, we can always track how much money is out there with the M1, M2, and M3 data that the fed... oh, never mind.

I meant mild in comparison to stagflation. Of course it'll depend on the action corporation, individuals and the government undertake this next year. I still contend that the conditions are extreme enough to cause stagflation. Considering the size and diversity of the US economy you would need quite severe economical conditions for it go into stagflation, thats what I was referring to.

___________________
Poetry>Byron//Blog>TheMean

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Orbax At that point you kind of crossed the rubicon and you might as well lay siege to Rome

We can't handle a 'guns and butter' lifestyle another 10 years.

Catch Barron's over the weekend?

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By Jonathan R. Laing Just as plunging First Marblehead shares were reaching terminal velocity, they snapped back as if on a bungee cord Dec. 21. The 67% one-day gain was sparked by an announcement that Goldman Sachs planned to bail out the student-loan securitizer by investing $260 million in its stock for a nearly 20% stake and providing $1 billion in financing to permit the company to honor its loan-purchase commitments to various banks. Even after the sharp rise -- the product of frenzied year-end short-covering by hedge funds -- First Marblehead stock (ticker: FMD) was down nearly 70% from its 2007 high of 57.25. Currently, the stock is trading at around 17. Yet forgive us if we don't genuflect at the altar of Goldman Sachs, at least in this case. We've been skeptical of First Marblehead for some time, having penned a negative story about it, "The Peril of Bankrolling Slackers," in our April 2, 2007, issue. The stock was then at 45. Even with the benefit of Goldman Sachs' help, First Marblehead faces big challenges. For one thing, the student-loan securitization market is largely frozen amid the credit crunch and subprime- mortgage debacle. That's a problem for First Marblehead, which gets almost all its revenues and profits from bundling student loans into securities. We're also still skeptical of First Marblehead accounting that depends on "gain-on-sale" profits. The company, in effect, makes its money by holding "residual interests," which represent what's left over after all the securitization's debtholders have been paid off. Yet the rating agencies have permitted First Marblehead to take 8% or more of the money it raises in the securitizations up front, and then allows it to book projected future profits from these residuals as current revenue even though no money actually changes hands. That game may be over. Risk spreads have widened substantially, meaning First Marblehead won't be able to front-end nearly as much money in residual profits. That's because it will have to pay much higher rates than before, leaving less for it to book as residuals -- if it's even able to issue securities in coming months. Likewise, the rating agencies seem to be taking a more jaundiced view of First Marblehead. The guarantor of its securitizations, The Education Resources Institute, was recently downgraded by Fitch after the insurer's reserve funds backing several First Marblehead securitizations were depleted. Other signs of stress have appeared. In the press release announcing the Goldman deal, First Marblehead said that it was suspending its quarterly dividend and taking an 18% to 20% write-down on its future residual income. Sure, shareholders can draw some comfort from Goldman's involvement. But the bank probably has a host of debt covenants amply protecting it from much downside risk in its investment. The same can't be said for shareholders.

any opinions on AAPL?

I really really want to take a bite

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Originally posted by Capitalizt any opinions on AAPL? I really really want to take a bite

The Mac Air is a piece of shit but people place Steve Jobs on a pedestal and AAPL always low-balls guidance (which got the best of 'em this go round). I think the key to the story at this point might be traditional Mac penetration levels actually showing up in PC sales as well as sales of their newest OS.

Negatively, at the end of the day it's still a consumer focused company and if you are worried about the U.S. consumer, well....that probably tells you what you need to know about AAPL right now. AAPL certainly isn't recession-proof.

I decided to sell everything and wait for the outcome of super tuesday.

The prospect of a Hillary presidency is just too scary for me. I saw some clips of her on Kudlow & Company today that were just unbelievable. This woman wants to freeze all mortgage rates nationwide for 5 years, to impose an "excess profits tax" on corporatons, raise capital gains taxes , force every citizen in the country to by insurance....the list goes on. The USA will look a lot like the USSR when she gets done with it...and stocks will not be a smart place to be.

If we do get a decent rally before election day, take profits and run for your lives.

I'm negative on airlines in general but some of the work / study I've done on them suggests a few trends that might be able to help pick a winner.

First one is uniformity of the fleet they run. This means an airline with very few different types of planes will benifit from having lower inventory costs associated with reparairs and spare parts while also having technicians that are specialized in repairing just a few types of aircraft. These mechanics should then be able to preform quicker and better then a group of similar people who had to learn seven or eight different airplane types.

Second one is all about the route structure. Rising fuel prices and global warming concernes point to sucess based on which airlines fly the most efficient routes. For example Montreal to Toronto is simply not a sustainable route because the cost of getting the plane off the ground is so large and the distance traveled is so small. By contrast a flight from Toronto to London, UK pays the same amount to get a plane off the ground and flies a lot further. Also the time / money savings relative other forms of transport are greatest on long haul / trans oceanic flights. Going back to the same example, Montreal - Toronto trains are almost as fast and cost almost as much as a flight (especially when cabs to and from the air port are factored in), yet the flight to London, UK only competes with ocean travel which is slower by a number of days.

In short, airlines with long flights (over oceans especially) and uniform fleets look like they will do best in the next 5 - 10 years.

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Originally posted by venomX I meant mild in comparison to stagflation. Of course it'll depend on the action corporation, individuals and the government undertake this next year. I still contend that the conditions are extreme enough to cause stagflation. Considering the size and diversity of the US economy you would need quite severe economical conditions for it go into stagflation, thats what I was referring to.

See I'm thinking that the economic conditions are already severe and that they will likely get worse.

I side with the Chinese governments opinion that elements of the US are worth investing in but not the country as a whole. The way you can tell this is what the Chinese are thinking is because of thier development of sovereign wealth funds that can cherry pick US assets that look sound instead of holding US T bills that track a much more broad economic spectrum.

What needs to be done to get the US out of trouble is to increase accountability. Bail outs have the exact opposite effect of what any logical policy would have. The bail outs reward risk takers who took stupid risks that didn't pay off. People who were wise and invested well get nicked twice. Once by financing the bail outs directly and once by watching thier savings diminish in real terms as inflation sets in.

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Originally posted by Capitalizt any opinions on AAPL? I really really want to take a bite

Yo, I'm crunching the 4th quarter numbers this entire week. Apple is on my list...

Anybody who wants their stock or watchlist crunched thru' my financial model (featuring the fundamental strength algorithm!!!) can just post a list.



EDIT: As I'm going through some numbers, I am getting a lot of empty values for several big energy companies. The data I'm getting off MSN's money site has some data missing. I don't know if its Microsoft or whether the earnings reports themselves are incomplete.

Last edited by Krypton on Feb-05-2008 at 05:57