View Full Version : what a week so far

06-20-2002, 08:28 PM
it usually doesnt go this well. dollar slidin, treasuries hot (back to them in a bit), naz tankin, and reits hot. hey i love the usa but i dont think bein a loyal american has much to do with plunkin your hard earned investment $ down. im bettin that there has been a big psych change with investors. with all the negative stuff you read about ceos these days i think were goin to see investors payin up for of all things dividends. investors feel like theyve been takin for a ride on the "increase shareholder value" fantasy tour. theyd rather get the money back in dividends and go thru the double tax rip off the govt pulls than see corporate ceos waste company profits earned. govt rip off you say? to prove its a totally whim as to what govt does look at reits. the profits from reits are only taxed once when divis are received by shareholders. govt chooses to do what it wants to whom it wants. system has worked well but a lot of problems are showin up now. i think if govt would stop the double taxin of dividends you wouldnt have seen a lot of the corruption in corporate board rooms thats comin out now. investors would focus on what they should focus on as part owners of corps i.e. gettin their fair share of the profits. this would take the focus off of avoiding taxes. investors could still be scammed but not as easily i think. sure its great to invest in real growth but at some point investors want their fair share of the profits. all investment models i believe are based on the investor getting profits returned to them. msft is sittin on $38 bill in cash and his Billness is investin in toys, media companies to name a few. how much does his Billness know about them anyway?

treasuries were down today but theyve had a great run. i think it was profit takin so well see if im right. i think the economy is softer than what most thought and the bond market yield curve was pushed up on the low and middle end anticipatin a fed rate hike. a fed rate hike isnt happening anytime soon. noticed options volatility readings are gettin bullish so maybe a rally soon in the stock market. i dont see the nasdaq doin well though. noticed some big tech names broke down badly today. emc at $6.40 sunw at $5.70 wow! i think theyre goin lower too. intc is below $20 again and one of the few standin firm is msft. wouldnt ya figure its the one i trashed but thats ok i may not be understandin msft but i seem to be understandin a lot of other ones.

06-20-2002, 10:25 PM
Treasuries are a scary place to be right now. Remember treasuries are owned a great deal by foreigners, they love em because they are one of the few risk-free investments in the world, or so the thinking goes. The run-up in rates today could portend a dark cloud if this currency run kicks into higher gear. I don't think there was profit-taking at all, I think its more people from overseas taking their money altogether. As they flee, the rates are bound to go up.

I don't know though if the currency run will continue unabated. I still find it hard to believe foreigners see better prospects in their markets. I mean what is so appealing about Europe or Asia right now? They go lock-step everyday with the US markets, half the pressure on the index seems to be purely reaction to US market moves or anticipated moves the next day. Think about it, 10 years ago if an American company announced an earnings shortfall, Europe would have shrugged it off and mostly stuck to themselves. Now if Cisco or Intel says something, it causes 3% sell-offs in Europe, often due to the expectation that the US market will do bad in its next session. This is pure stupidity, how Cisco misses its revenues by a couple of percent has almost no effect on European companies. Simple as that, but the markets are the way they are now and you have to accept that. As for CEO's stealing, that is another outrageous claim. A few CEO's have made some questionable ethics decsions and now CEO's are crooks? Are you kidding me? I mean Kozlowski did something clearly illegal and deserves to be in trouble for it, but come on the guy was trying to cheat on his personal taxes. Not the guy you want running your company no doubt, BUT his personal behavior on that matter had very little to do with his own company and his actions didn't change a fundamental thing about his company. Now that he is out, it really gets silly to pound down the company's stock price because he is indeed not going to be calling any more shots. I don't know, I accept that the fear and worries are hurting the market, but this is irrational fear (opposite of exuberance I guess). CEO's are in very broad terms, very respectable and driven people. Almost all today have a duty to grow their company and stock price, and by almost any measure they do it well. Its an extremely difficult job, the guys that go down usually have very little direct control on the things that go wrong. Some guy four levels down could be harassing women cause he is a real creep leading to multi-million dollar lawsuits. The lawyers suing will claim its the CEO's fault cause there wasn't a strong policy out there. In reality every company has a policy out there, but all it takes is one real jerk who doesn't get it and the whole company suffers no matter how good the policy is and the CEO who never met the jerk gets blamed for it. So before you go calling them crooks or think they aren't out to make you money, just remember if they make mistakes these days its often the fault of the investing public. They won't accept a CEO that doesn't grow a company an unreasonable rate. They won't accept a CEO that gets outmaneuvered by another company that took great risks in doing it. Worst of all, the investing public won't take responsibility for their own damn investments! They should come gamble with us and see how we take responsibility. If the Mets lose and I bet the Mets, oh well I lost I took the risk of betting on the Mets and it didn't work out in my favor. Investors take the point of if I invest in something and it loses value its someone in management's fault! I don't pick losers, I must have gotten screwed over by management or auditors or government people or...well you know the mentality. People people, invest understanding that you could lose every single penny of that investment. Period. On occasion there are some frauds out there, BUT that too is part of the investment scheme. Its a potential issue, your trust in management. 99.9% of the time management is on your side, maybe a bit agressive, but still on your side. If you lose money its just part of the reality that is investing. Stop investing your whole nest-egg in two stocks or leaving every penny of your retirement in company stock and you won't get crushed. Why doesn't anyone ever seem to point this out????

06-22-2002, 12:11 PM
as far as treasuries thats why they have markets to resolve our point of views. billy youre a lone voice in the crowd about corruption at corps. maybe youre a contrarian lol. subject deserves to be debated ill take a raincheck for now but ill return to it very soon. the tyc problems are more than just departed ceo. cash flow is a big concern. maybe a good time to buy tyc with new ceo dressing company up for sale of assets. situation needs to be studied which i havent. personally i dont mess with tyc type situations. leave it to experts cause when they say too leveraged and accountin problems this ol cowboy rides off into the sunset.

06-24-2002, 03:27 AM
Its not like I would suggest investing in this particular name, just the concept of saying I will take my money out of stocks as a whole because I think CEO's are corrupt is irrational. Anyways I personally think the corruption issue isn't a heavy weight on most stocks, just the names that get talked about on CNBC or other shows of stock hype. After all the guy who owns stocks that aren't named is likely to say "nah, that is what the guys at that company do. Not my guy, my CEO is great and has a great concept/plan/strategy to bring me some profits" Stock overhang really is taking the money off the table of the institutions, the hedge funds, the big money...all people that are concerned about the risk of going long when another company could come up dirty. It is not going to be easy to overcome in the short run and maybe we need to break through some of these lows to clean out the negative sentiment and get some capitulation from the losers that won't be part of the next rally. From a fundamental standpoint I just can't imagine the market being lower from where it is now 9 months into the future, with only one exception. That would be wholesale dollar collapse, but I am sorry I just can't see that happening. It will tumble a little more, but quite frankly that will yield some longer term benefits for US industry and minimal inflation since relatively few of our imports are priced in Euros. A majority of our imports are from Canada, China, Mexico and Taiwan...all which have currencies that will likely stay more marked to the dollar than the Euro. The Yen is the only larger concern, but Japanese people aren't going to bail out on the US for very long especially with the BOJ defending the Yen at unpredictable intervals. All in all, I think the currency devaluation will play very favorably to the US economy as long as it doesn't cause a panic. Since the US economy is clearly stronger than just about anywhere in the world right now, that isn't going to happen either. So the chips are really stacked, maybe the market moves down a little more, but I think the odds are highly in favor or a pickup in the near future and a pretty strong rally as sentiment really couldn't be much worse.

06-25-2002, 03:40 PM
I totally agree with you on the CEO thing and people not willing to accept the fact that they made a bad bet on a particular stock. how about Martha Stewart Inc. getting battered to the tune of down 21% just because Martha is in a bit of hot water for unloading her Imclone stock? puleeze.

I work with CEOs of private companies on a daily basis. One thing I can say for sure is that they are not crooks. They are very driven and under a great of deal pressure to build a successful company in a tough, ultra-competitive business climate.

It's kind of funny when I talk to CEO's of public companies. They are pretty much gagged as to what they can say. It's like their lawyer makes them memorize about 15-20 sentences and that's all you will get out of them no matter what the subject.