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May 3, 2007
Cara’s Daily Board, Thurs., May 3, 2007, 8:01 AM
There will be a change of govt in The Bahamas for the next five years. The victorious FNM will have 23 or 24 seats in a 41 seat Parliament, while the losing PLP will have the remainder. About 90 pct of the people voted. The local business community will be happy.
Hubert Ingraham, who had been Prime Minister when the Free National Movement was in power in the 1990’s, has said Bahamas should consider abolishing the law that allows foreigners to qualify for residency by buying a house in the country, and that the country should lease not sell its land to foreigners. I agree with these policies as long as the new govt remains as pro foreign investment as they were in the 1990’s.
In the US, fall-out over the housing/mortgage industry problems continues to hurt bond investors who bought the securitized sub-prime loans. In the past two weeks, Moody’s Investors Service cut credit ratings on more than 30 such bonds that were issued in 2006.
Yesterday, the major market indexes in the US set records. The Dow (+0.58 pct), S&P 500 (+ 0.65 pct) and NASDAQ Composite (+1.04 pct) were very strong. The S&P MidCap 400 was even stronger (+1.14 pct) as capital flows into this market seeking buy-outs, take-overs and richer dividends.
The market admittedly also has liked the continuing stream of positive earnings surprises as well as the odd spot of good economic news such as yesterday’s March Factory Orders being up +3.1 pct, which exceeded expectations of a +2.2 pct increase. Moreover, core capital equipment orders rose +4.8 pct, their largest gain in 3 years.
That news pulled investors into the economically sensitive sectors where Materials (+1.2 pct) and Consumer Cyclicals (+0.9 pct) were outperformers.
Crude oil dropped more than -1 pct yesterday due to an in-line EIA inventory report, and that was enough to pull investors into the Transports (DJTA +1 pct). But, despite the weak oil price, natural gas prices were up and even the Energy sector (XLE) was strong on the day.
With easy access to debt, and a willingness to continue to play Momentum (“Go Mo!”), the musical chairs game continues. The melt-up in stocks is likely to continue until there is a melt-down in bonds, as I see it. But that will take more effort by central banks to keep interest rates lower than risk levels would otherwise dictate. So, speculation will abound.
I’m still waiting for the melt-up in precious metals because gold is not going to be thrown away in a speculative crazy market. It will be the leader of the final charge to the broad market cycle top, I believe.
There is no reason to change what I wrote in this space yesterday morning. Another strong day. Shorts are being taken to the cleaners, which is one reason I don’t short a market until after pessimism takes hold of the global market, which happens maybe once in every four years or so. We’re not quite there. So far the Bulls are winning, whether you or I think they have a basis for that.
The power move, however, was in the morning. Precious metals started in the afternoon, and as we’ll see continued through overnight.
Same here.
Fairly strong markets in this region today.
UK, Germany and France bourses were all trading up early today (7:05am ET).
The $USD has kept its strength, at 81.689 at 6:40am ET, which is close to yesterday’s 81.873 at this time.
U.S. Treasury Bond Jun. 2007 contract
This chart shows how much of a hit the US Bonds took after the release of the strong ISM manufacturing data on Tuesday. Immediately the yields popped and bond prices plunged. After that the prices recovered somewhat but were modestly soft at day’s end as yields were on the rise (following gold).
The e-Mini Jun-07 oil contracts are at 64.000 (6:42am ET), which is down just -0.22 at this time yesterday. There were three price spikes down in three days, which helped crank equity prices higher, but from mid-day yesterday, oil prices have been recovering.
Hedge traders remain on pins and needles.
Gold Jun-07 contracts on the NYMEX
This morning at 7:45am ET, June gold is back up to 678.40. I’m going to show both the futures and spot price in gold from this point on as I expect the data will be helpful to nervous nellies who for some reason don’t share my confidence that gold prices are going to soar.
This morning at 7:18am ET, spot gold is up to 675.68, an improvement from 670.80 yesterday at this time.
Spot silver was hammered yesterday morning (7:18am ET), at 13.13. This morning at 7:19am , spot silver is up to 13.31, close to the 13.41 it was at on Tuesday morning at this time. I think the selling (ie, the downtrend this week) is over. Glittering skies ahead, I hope.
Spot platinum is up to 1295, at 7:22am ET today, which is up +10 from yesterday at this time.
Spot palladium is up to 372 at 7:22am ET, which that move I suggested was coming from the level of 366-368.50 for the past couple days.
On Tuesday morning, I wrote, “I note the media negativism re palladium vs platinum, but the palladium price is not dropping, which makes me think somebody is being deceptive.”
$CRB moved down from 311.58 to 310.52 at the close yesterday.
Still backing and filling, and waiting. But $CRB will be up today, I believe.
Hugh Cleland and I will be lunching with Western Goldfield’s Randy Oliphant and Ray Threlkeld next Thurs or Fri. Randy says he’s waiting to see if we can “kick butt”. (LOL)
Randy was the former CEO at Barrick and the manager given all the credit for their hedge program, which may or not be fair. We’re going to ask if the new company used any puts and calls with their bankers in getting the loan because shareholders need to know if the upside has been capped at present gold levels or is higher to say 900 or 1000 gold.
Barrick is in the news with a report they finally ended the “Oliphant Hedge”. I josh. But this news has helped the gold price.
Cara 100 Stockwatch
Here are the Cara 100 gainers on Friday.
Note there are a lot of Materials companies here.
Interactive chart of the top 12 Watch List gainers
I fail to grasp why WHR continues so strongly unless the company treasury is buying insider stock at the top.
Here are the top Cara 100 losers for Friday.
There were a few losers on a strong day.
Interactive chart of the top 12 Watch List losers (Interactive link)
Here are the 52-week highs and lows in the Cara 100, set in the prior session.
AET again plus WHR, ERJ and DEO were the Cara 100 companies whose stocks yesterday hit a 52-week intra-day high and none hit a low. I would never short these stocks until the RSI-7 on the Daily drops back below 70.
Here are the interactive charts of up to a dozen stocks with (unsmoothed) RSI-7 above 70 and below 30, from “Chris”:
There are now 2 Cara 100 Company stocks that are below 30 on the Daily RSI-7 versus 16 above 70, using data from “Chris” – which he takes from BillCara2.com.
I would not buy Toyota (NYSE:TM), for example, unless and until the Daily RSI-7 moved up above the 30 line, and the Yen weakened against the USD, helping Japanese exporters.
Why I publish this data is to tell you that I avoid selling the Cara Distribution Zone (DZ) candidates until after the RSI-7 drops below 70. These are above.
Same thing for buying the stocks that have been in the Cara Accumulation Zone (AZ). I won’t usually buy them until the stock price crosses back up through the Daily RSI-30 (and this list hasn’t).
If you don’t have intra-day RSI-7 (or other technical indicators) at hand, then you have to watch the price closely. Any strong moves will likely trigger the Daily RSI-7 limits, which would be reported at end of day.
Once again, it’s hard to compartmentalize trading rules because the character of markets is always shifting. Sometimes that 70 line for me becomes 75 or 80, especially early in a new Bull market. Late in a Bull, like we’ve experienced since 4Q02-1Q03, I tend not to sell or short until the RSI-7 on the Daily drops to maybe 68, and there is commonality of price motion within peer groups.
Here are the current Cara 100 RSI-7 values, sorted by highest and lowest, first by Daily values and then by Monthly, prepared by “David” using TC2007 (Worden) [based on Welles Wilder smoothing], which is slightly different than the RSI-7 formula used by “Chris”.
Here are the stocks in the Cara 100 trading at extreme values:
General Motors (NYSE:GM) is still in trouble. Earnings from both manufacturing and finance (GMAC) are a disaster. The cycle is still not over. It’s not the time to be buying auto stocks.
There are various sources for up/down grades by broker-dealers. One is at Briefing.com. Traders ought to check everyday for ratings changes. That website updates in the morning.
JP Morgan went Overweight on LYO.
AG Edwards upgraded CHRW to a Buy, and Pru improved the rating on NEM to Neutral.
BMO downgraded Sun Life (SLF)
Wrap up:
Best wishes again to Danny Hughes.
Have a great day. Too much to do; too little time.
Posted by Posted by Bill Cara on May 3, 2007 08:01:20 AM | Category: Cara's Bull Board
Discourse
I am in the Dental Laboratory business. Our industry uses precious metals that are 90% palladium base.Our industry is experiencing a drastic slow down. This may be the reason why the demand for palladium has slowed and is not increasing in price. sciden04
Posted by: sciden04 ![[TypeKey Profile Page]](http://www.billcara.com/nav-commenters.gif)
at
May 3, 2007 8:25 AM [link]
Dear Bill,
I don't like to fly unless I've visited the airport bar beforehand, but I did go to Bahamas a few years back. I had so much fun, I was literally CRYING on the plane back to New York, and I'm a grown man. Use your imagination, it all went down in Nassau town.
On a slightly more mundane note, IVAN is turned around and (is goona be) heading north with a bullet.
Golfing Chris
Posted by: shark_attack at
May 3, 2007 8:46 AM [link]
LVS down 4.5% in pre-market. MPEL also down in sympathy.
May be a good chance to get MPEL.
Posted by: JogyP at
May 3, 2007 8:55 AM [link]
I would have to think with the dollar going down that Las Vegas ought to be an exceedingly cheap destination for European gamblers.
Still have my short on GOLD
Stock Market is in michael buble territory
Posted by: stockershock at
May 3, 2007 9:28 AM [link]
http://sentimentrader.com./aboutus.htm by Jason Goepfert
A fellow bloggee mentioned this as a resource to me. He uses it, apparently very successfully to help determine how much risk he wants to use if long equities. Supposably a great resource of information to build models.
Anyone getting Interactive Broker shares allocated? I'm not seeing anything show up in my account.
Bill,
Do Gold and Tech trade inversely? This seemed to have been the case during the bubble years. If so, is it still signficant now to keep in mind?
Posted by: jasper at
May 3, 2007 9:35 AM [link]
ABX
Good move in Barrick yesterday and very positive comments from Peter Munk about the company and the gold price in genera.
I know it is a conservative way to play the gold price, but am thinking we could see a good move up over the next few months as the large players want more exposure to gold and Newmont not executing well.
Posted by: bb at
May 3, 2007 9:54 AM [link]
bb, I agree.
I also feel tht HB&B analysts that had been turned off by the hedge cap, will now be turned on. Get set for a wave of upgrades. This might be a good time for options players to consider the calls. That's not advice -- just a thought to consider because after the analyst opinions turn bullish, just wait for traditional media to regurgitate the stuff.
http://gold.seekingalpha.com/article/34323?source=d_email&u=24529
Posted by: Bill Cara at
May 3, 2007 10:01 AM [link]
jasper,
Gold and tech will bubble up together until the bubble bursts, and then they'll deflate together.
In typical market cycles, there is a bigger inventory problem for the techs, but this is no longer the case as Just In Time is now the norm.
Also in typical cycles, interest rates would be much higher right now, which would depress the techs, but with relatively low interest rates and easy access to debt and stronger balance sheets this cycle, I think the techs will not be weighted down late in the cycle. Ergo, I think they'll float like PM's.
Posted by: Bill Cara at
May 3, 2007 10:07 AM [link]
Bill, is there anything up with SLW?
I've been anticipating a cup-n-handle breakout for about two weeks(for the handle part to complete). Now the handle is nicely form, but the price of silver is not going anywhere. Maybe the players are taking a stab at it anyway?
thks!
Posted by: 8heir at
May 3, 2007 10:10 AM [link]
8heir,
I see a US$12 multiple top resistance for SLW -- but not to worry.
Look at the weekly at Stockcharts.com
http://stockcharts.com/charts/gallery.html?SLW
There was a double top break-out on the point & figure chart on April 17, which I noted at the time. After silver was hammered since then, SLW did not roll over and die. Just resting up for the big journey ahead.
Once through 12 and a bit, SLW could quickly move to 15, I feel. I love this business model, and the company has fewer than 10 employees I believe.
Posted by: Bill Cara at
May 3, 2007 10:18 AM [link]
I don't watch Financial Entertainment TV, but I imagine they are on "S&P watch" today, something like: "COUNTDOWN TO 1-5-2-2" Can someone confirm?
Any day now really, it's like a magnet. You know, one difference between an exhibition and a real competition is that all kinds of things (like the "score" and the "plays") can be predetermined. (Hint: the Globetrotters play exhibition games, which they *always* win.)
As Bill says, the market will not be "allowed" to fail until HB&B & friends have reached safe harbour. I doubt very much they'll let Mom & Pop know where that harbour is, much less when they reach it. That's why we all come here to learn from Bill: he has a great spyglass!
t4k
Posted by: trade4keeps at
May 3, 2007 10:18 AM [link]
Canada's HB&B are no longer interested in supporting the Toronto Stock Exchange it appears. They will be offering a better system for trading. Hooray. I have always said that the TSX management are dead from the ankles up. Their website is the absolute worst of any major financial organization in the world.
Posted by: Bill Cara at
May 3, 2007 10:36 AM [link]
Yep, today we're cheering S&P 1500 on CNBC.
Rah! Rah! Rah! Now back to the usual exorbitant exuberance.
I do note a good deal of talking noggins warning of a pullback, which usually means they sold yesterday.
Posted by: Craig at
May 3, 2007 10:41 AM [link]
QQQQ / QID price crossover is 46.90 ...
today? tomorrow? next week? It's another magnet.
t4k
Posted by: trade4keeps at
May 3, 2007 10:42 AM [link]
Shark,
Couldn't agree more on IVAN. I have followed it off and on for the past few years. Now is a great time to pick up some shares, IMO.
Posted by: ricej11 at
May 3, 2007 10:53 AM [link]
More about the US housing market crisis.
http://ca.us.biz.yahoo.com/seekingalpha/070503/34418_id.html?.v=1
Don't get sucked into trying to bottom pick these stocks, yet!
There is a lot more pain to come.
Do you recall my article in the Summer of 2005, with CNBC's Bill Griffeths touring the nation, pumping real estate? I said that exercise would turn into one of the great lessons in capital market finance and trading, ever. Trust me, the book hasn't been closed on that one yet.
Posted by: Bill Cara at
May 3, 2007 11:04 AM [link]
Thanks Bill.
I find life is such a mystery. Looking at the chart of SLW, you can call it anything - rising triangle(long term, cup-n-handle(11-06 till now), bullish flag(march till now), with the moment of truth is so ever close, so is the weakest season of PMs!
By the way, financial sense had an interview with Jeffrey Christian of the CPM group, fasinating! Maybe Leisa can write a summary of it?
MarkM, I suspect GFI has taken over the helm as the ringleader of gold! Yesterday, while AEM, GG, and KGC took their beating, GFI stoods its ground and then headed north! It was kind of "weird" to watch that kind of sight unfold!
I'll take this moment to express my long overdue gratitude to you, Bill. I've learned much from you - people like you give us hope and faith of humanity! Thank you!
Posted by: 8heir at
May 3, 2007 11:05 AM [link]
With regard to the earnings surprises and the commensurate share price surge--the short interest in some of these holding (take WHR, AMZN, SMDI) seemed pretty high going into earnings. I cannot help but believe that much of the air beneath the wings of this market are shorts covering.
re: IBKR
My mistake..Fido rep said deadline was 5-2 4pm to make confirmation...usually, open mkt trading begins next day...not the case, news has it on friday.
pasted below:
The Greenwich, Conn., firm, which is expected to begin trading on the Nasdaq Stock Market on Friday, lifted the number of class A shares offered to 34.5 million from 20 million shares previously. It will trade under the symbol "IBKR."
The company's underwriters also lifted the expected price range of those shares to $27 to $31, from $23 to $27.
The revised terms means Interactive Brokers could raise just over $1 billion if its IPO prices at the midpoint of the expected range.
The company plans to conduct the offering using the "OpenIPO" and best efforts method, under which the IPO price and allocation of shares will be determined primarily by an auction process.
Only one other IPO has raised more than $1 billion this year.
Posted by: jasper at
May 3, 2007 11:11 AM [link]
8heir,
Goldfields (GFI) has very solid, long-term management. They are in Venezuela today, in the region of Gold Reserve and Crystallex. They have an ability they say to take on challenges that other companies might shy away from. They also have the scale to take on debt or raise more equity less costly than many other companies in the PM business. I'd like to see them take a run at both GRZ and KRY. That would probably put them into number one spot in the industry in terms of reserves, slightly ahead of Barrick, whereas in terms of production they are half the size of Barrick today.
Btw, I'm having lunch with Randall and Ray of Western Goldfields on Thursday May 10. Then I have other meetings in town so I will not write anything until early Friday May 11.
Posted by: Bill Cara at
May 3, 2007 11:20 AM [link]
I bought Hecla (HL) today. Yesterday's sell off was headline driven based on poor YoY comparison.
The conference call was very positive. Even had some discussion of VZ situation and (apologies to MarkM) even had a mention of KRY situation.
Posted by: number2son at
May 3, 2007 11:30 AM [link]
Gold moving up nicely..
GRS staying behind. picked up more at 16.05
UXG up more than 5% from lows Tuesday.
Posted by: JogyP at
May 3, 2007 11:34 AM [link]
Does anyone have any knowledge of Pinetree Capital Ltd. (TSX - PNP)
I can't seem to find much information on why the stock dropped from $23+ to $12 on April 3rd. It's trading around $13 today. I had a double take when I saw a list of recent press releases. They have been on quite an acquisition spree. Is this the makings of some resurrected miner scheme?
4/10/07 · Pinetree Capital Ltd. Acquires Common Shares of Valencia Ventures Inc. - Market Wire
4/12/07 · Pinetree Capital Ltd. Acquires Common Shares of Pacific Comox Resources Ltd. - Market Wire
4/2/07 · Pinetree Capital Ltd. Acquires Securities of Nortec Ventures Corporation - Market Wire
4/20/07 · Pinetree Capital Ltd. Acquires Securities of Virgin Metals Inc. - Market Wire
4/20/07 · Pinetree Capital Ltd. Acquires Securities of Western Troy Capital Resources Inc. - Market Wire
4/23/07 · Pinetree Capital Ltd. Acquires Securities of ISX Resources Inc. - Market Wire
4/23/07 · Pinetree Capital Ltd. Acquires Securities of Kernow Resources and Developments Ltd. - Market Wire
4/30/07 · Pinetree Capital Ltd. Acquires Securities of Rockgate Capital Corp. - Market Wire
4/9/07 · Pinetree Capital Ltd. Acquires Common Shares of Strategic Metals Ltd. - Market Wire
4/9/07 · Pinetree Capital Ltd. Acquires Securities of Torch River Resources Ltd. - Market Wire
5/2/07 · Pinetree Capital Ltd. Acquires Common Shares of Cue Capital Corp. - Market Wire
5/2/07 · Pinetree Capital Ltd. Acquires Common Shares of Global Minerals Ltd. - Market Wire
5/3/07 · Pinetree Capital Ltd. Acquires Securities of Northern Abitibi Mining Corp. - Market Wire
TIA for any responses.
Posted by: cb at
May 3, 2007 11:40 AM [link]
Also removed 1/2 hedge on my long KRY position today.
Posted by: number2son at
May 3, 2007 11:43 AM [link]
Regarding PNP (Pinetree Capital) - Their stock split on April 12 - hence the price drop. Check out their financials - they are rock solid. They have made ground floor investments in many resource companies.
I'm long PNP -
Rich
Posted by: BeeThousand at
May 3, 2007 12:03 PM [link]
Gold retailing in India:
http://ia.rediff.com/money/2007/may/03retail.htm
Traditionally, Gold has been bought in the form of ornaments (in 8g increments and 22carat purity). Gold is more of a social necessity than an investment (women NEED to wear gold at social functions). Will a coin replace the utility value of a necklace? :-) Time will tell.
The new generation of educated middle-class has less social pressure to own gold ornaments however, so this might be a better avenue for them to invest in the metal.
Posted by: vg at
May 3, 2007 12:36 PM [link]
Good morning, Bill.
Nice to see the PM strength. FWIW, American Association of Individual Investor's sentiment poll POSTED that only 28.5% of respondents were bullish while 54.3% were bearish. This could be more few for the melt-up. Throw more WHR, CMG (or any other stock) shorts on the barbie.
Bought some shares of ICE. Nice earnings, breakout and ISE deal should be bullish for the exchanges.
TSO getting smacked, but think i'll wait for it to come down a bit more.
Posted by: mogwai8myball at
May 3, 2007 12:36 PM [link]
cb,
Re Pinetree Capital (PNP.TO), I used to know Sheldon Inwentash when he was a fund manager on Bay Street. I like him, and the success he's had with PNP is well-earned. Looks good on him.
To all,
I picked up a couple very small mining exploration company names by walking the floor at PDAC in March, as you know. One was Azimut (from Montreal) and the other ValGold (from Vancouver). Both are up substantially since I pointed you their way.
I just got off the phone with ValGold's CEO Stephen Wilkinson, and it seems like we have a few things in common. Both of us worked at Dominion Securities. When I left I was in DS Investment Management Ltd, and when Steve left quite a few years later he had been a mining analyst there.
But the surprising thing is that as kids he remembers coming to my house and me to his. I still remember that big concrete pool in their backyard out in Mississauga -- in the mid-to-late 50's, before it was called Mississauga I think. His parents were my parents best friends going back to the start of the 40's. They attended my parent's memorial service in early July 2005, and told me how proud they were of their son in Vancouver in the investment business. I never put two and two together, until this morning.
Nice story, so now you'll understand that, while I had no bias initially, I will likely be their Number One supporter going forward.
Jay Taylor put out a Buy on ValGold this week. Taylor's mining analyst is on the property today in Venezuela (I believe). The stock is tight and there is a very small float. The property is most interesting. This is the kind of situation that, with positive drill results, could triple overnight -- or better, like Aurelian.
But you know my bias as of today, so I'm not going to lead you further. Please get all the research you can find on this company. As Stephen Wilkinson says, "The stars have finally lined up."
I hope so, for the sake of our parents.
Posted by: Bill Cara at
May 3, 2007 12:53 PM [link]
VG,
Let me assure you that Indians continue to wear gold regardless of generational differences if any. I recently travelled with a nice professional Indian couple with children. All were wearing beautiful gold bracelets, even the babies.
Posted by: Craig at
May 3, 2007 12:55 PM [link]
uxg..i think it's ready to break out again. no positions due to self-imposed trading restriction.
Posted by: 2nd_ave at
May 3, 2007 12:59 PM [link]
Bill. Attached is the Jay Taylor review on Val Gold. I have been doing some research and like what I have found out todate. Bill I think Mississauga was called Cooksville at one time. In fact many oldtimers still call it Cooksville.
http://miningstocks.com/archive/hotlines/3223838/hotline-2007-04-27.pdf
Posted by: Horatio at
May 3, 2007 1:06 PM [link]
bmd..have built a "half position" in it now. if it continues to slide, will increase to a "3/4 position," if it breaks out again on high volume, will probably take a "full position" into the summer.
Posted by: 2nd_ave at
May 3, 2007 1:14 PM [link]
Craig. You are right. Indians absolutely love their gold. It is believed that the rural people of India hold 11,000 tons of gold. Not alone is it worn as jewellery it is used in all forms of financial transactions on a daily basis to avoid taxes. Now that Indians are increasing their wealth the demand is going to increase.
Posted by: Horatio at
May 3, 2007 1:15 PM [link]
2nd_Ave:
Thanks for your note on BMD.
I got in yesterday at 3.30 and exited at 3.44 now.
Will buy more if it comes to 3:30, but trading it is a bit scary as volume is so thin at times.
What is you take on SNE assuming Spiderman is going to be a huge sucess this weekend.
Posted by: JogyP at
May 3, 2007 1:44 PM [link]
ALOHA !!
ECU SILVER - ECU.V/ECUXF.PK
Sanata Juana 100% ECU owned ... Has put in a news release today that I believe is pivotal from a geological standpoint since assays on the veins within the Mineralized Corridor(MC)are increasing significantly in width some by as much as 27m.
I added to my position about five minutes after I read the assays.
ECU news link: http://biz.yahoo.com/ccn/070503/200705030388255001.html?.v=1
Aussieontop ... I suppose you have heard of Oxiana, a large Aussie miner that I believe I read is around $16bil cap. At any rate my network in Perth mentioned a JV that Oxiana has going with a small junior I have owned for over a year now called KALIMANTAN GOLD(KLG.V/KMGLF.PK). Kalimantan put out a news release a few days ago about that JV and apparently Oxiana is now drilling on Kalimantan's property and has agreed to a pre-feasability funding of $37.5mil. That seems abnormal in terms of it being a very sizeable commitment that I don't usually see. Is that usual for a big Aussie miner to commit that much up front? Do you know much about Oxiana or their management?
Oxiana JV link: http://biz.yahoo.com/iw/070423/0242300.html
I am long on both these companies. I do not own Oxiana shares.
Posted by: kaimu at
May 3, 2007 2:03 PM [link]
I just received this mail from an investment pro in Canada who is very upset as you can see about the HB&B blatant conflict of interest and total disregard for the customer:
"Would you believe those @)#$*%*@!)^* had a buy on TSX the whole time they knew about the plan for the HB&B to create their own trading system.
Now the stock is down 11% on the day and big #*#^&#^*$_ surprise they can't advise because they are restricted!!!!
Those a@)%#*)s !!!!"
http://stockcharts.com/h-sc/ui?c=x.to
You readers are now seeing the truth behind capital markets. This is yet another in a continuous string of instances where we need a securities regulator and a marketplace that is not owned and controlled by the sell-side, lock, stock and barrel.
My contempt for their boardroom politics and their holier-than-thou pronouncements about the level playing field they give us knows no bounds.
I have been there, done that, and I'm proud to say, now I just write about it.
When does this nonsense end?
Posted by: Bill Cara at
May 3, 2007 2:16 PM [link]
JogyP,
Can't argue with making money on your trade, but I would encourage you to hold a partial position for the long term. BMD is one of those companies I just happened to have on my watchlist after James DePorre got burned on it last year. After watching buyers step in again this year I decided to read up on the company, and I like the setup. It's a simple operation with few employees at this point, and they have everything in place for major growth over the next several years if the oil sands industry takes off.
No opinion on SNE as I don't follow SONY.
Posted by: 2nd_ave at
May 3, 2007 2:19 PM [link]
JogyP -
Barring a quarter billion blowout gross, Spiderman shouldn't move the needle for SNE (except maybe for an hour or so if rev. beat Hollywood's buzz). Too many other issues in electronics. Studio successes usually move the larger conglomerate's stock with sleeper surprises and/or exceptional multi-month slate. As for the derivative plays, you're probably late to the party e.g. MVL, HAS, ERTS.
JML
Posted by: Jumble at
May 3, 2007 2:19 PM [link]
Does anyone have a view on the possible impact of the "DC Madam" releasing her client list Friday eve on markets next week? That is if she follows through and outs some more big shots?
Posted by: GTT at
May 3, 2007 2:22 PM [link]
GTT-
Different kind of "Plunge" Protection Team.
Posted by: MarkM at
May 3, 2007 2:30 PM [link]
>
MarkM--that's too funny!
I'll give this to her. What a clever idea. Make the list available so that her clients can back up her story that nothing beyond what was on the straight and narrow when on. What are the folks going to say other than reinforce that they received "massages".
MarkM....very funny!
FWIW...sharing a view about "sentiment"....from a service that I use:(alternative views welcome)
Sentiment is ONLY IMPORTANT when they are at EXTREMES!!! This
means you can use it as a primary indicator when things swing to
one side of the ledger for a prolonged period of time. It takes
a lot of time to swing a market from one direction to the other.
Sentiment is basically always the culprit when a swing
ultimately takes place. On that note, the P/C ratio in 1999 was
consistantly very low with readings in the .30's and .40's and
rarely above the.60's. Day after day and week after week until
the house fell in. During this entire bull run since last July,
the P/C ratio has been consistantly very high with an enormous
number of readings well above 1.0 and almost none as low as
the .50's. The bottom line thus is that the bull market will
continue on for some time to come. Always pullbacks but this
bull potentially has a long way to go.
Posted by: jasper at
May 3, 2007 2:49 PM [link]
Here is Deepak Lalwani's weekly report on India, with compliments.
Posted by: Bill Cara at
May 3, 2007 3:13 PM [link]
Jasper -
I may have forgotten the details of my logic course, but I find this type of argument internally challenged. Observing "condition (A) leads state (B)" does not translate into "NOT condition (A) implies NOT state (B)". How simple the markets would be if such dichotomy existed.
JML
Posted by: Jumble at
May 3, 2007 3:14 PM [link]
Jumble,
Good point. So you're saying that if put call ratios are over 1.0 or even more complacent and toward the neutral zone, namely not extremely low, one could still have a crisis? I'm not a student of this sentiment indicator. Historical data could answer the question, but even then there is always a first time. More to your point, I don't want to rely on a single indicator for comfort. Sentiment does intuitively strike me as a good predictor in concept, but I would want to build a model on multiple indicators that has good back testing. Nothing is perfect, but could stack the odds.
Posted by: jasper at
May 3, 2007 3:27 PM [link]
FWIW, little more than a year ago, I placed some money on the sidelines. Instead of retaining the funds in a money market (mm) yielding @ 5%, I placed the money in weakening dollar plays thru Profunds, Rydex ($ double inverse), another fund and a Citicorp issue of a basket of Asian currencies that trades on the Amex. The strategy has handily beaten the mm rate. All the gain has taken place without the yen strengthening vs. the $. So if you think BOJ tightens eventually (fall?) and the euro holds if not strengthen, there’s room for more upside.
Now, I recently read a survey which had 92% of portfolio managers bearish on the dollar.
The contrarian in me has me thinking about reducing some but not all these weak dollar plays over the next 4-6 weeks. Sounds like a plan.
Posted by: Seamus at
May 3, 2007 4:00 PM [link]
MarkM-right on..and I'm sure there really is one.
Posted by: 2nd_ave at
May 3, 2007 4:09 PM [link]
JogyP,
Why don't you keep an eye on this site?
http://canadianinsider.com/coReport/allTransactions.php?ticker=BMD
New President/COO started Tuesday, and depending on how many shares he has been awarded, that should bode well for share price performance.
Posted by: 2nd_ave at
May 3, 2007 4:37 PM [link]
Today, I've gotten 4-5 equity ipos from fido. A lot of deals still to be made?
Posted by: jasper at
May 3, 2007 4:54 PM [link]
Jasper -
I frankly have no opinion on the predictive power of the sentiment indicator or put/call ratio at different levels. There's always two sides to a trade and I have heard recently experts touting put buying as a bullish sign when combined with going long of the underlying. My bone is with the construction of the argument only. This type of false logic pervades the facile comments of numerous market commentators. Fundamentally wrong, though. Let us know if you come across some interesting research on the subject.
JML
Posted by: Jumble at
May 3, 2007 5:08 PM [link]
http://www.ft.com/cms/s/8804de96-f981-11db-9b6b-000b5df10621.html
Well, Bill, maybe this is a small bit of consolation--From the Financial Times: "A Dutch appeals court on Thursday ruled Goldman Sachs and ABN Amro misled investors when they underwrote the disastrous initial public offering in 2000 of Dutch internet service provider World Online.
The ruling delivered a sharp blow to ABN and Goldman in a seven-year-old case viewed as one of the worst examples of dotcom-era excess."
Re: homebuilders
I read comments from a lawyer helping a small private builder through bankruptcy a month ago. He said some of the public companies will go through the same experience in a year or two. It is just a matter of time.
Also, some of these builders had mortgage operations that pushed people into buying homes they could not afford. This is the basis of the federal investigation of Beazer, but others like Lennar had much bigger mortgage arms. Lots of potential liability there.
There are also class action lawsuits for shoddy work brewing as these builders seem to have neglected quality and local housing regulations.
Lots of bad news still to come IMO. Mish's blog has had good info on these issues for the past year:
http://globaleconomicanalysis.blogspot.com/
Posted by: moab at
May 3, 2007 5:18 PM [link]
http://www.forbes.com/topstories/home/feeds/ap/2007/05/03/ap3683785.html
Article in Forbes today says that Chavez is threatening to nationalize VZ banks and the largest steel company if they don't get with his program. Quotes him as saying that he was voted to bring in socialism.
Fred
Posted by: lovesaves at
May 3, 2007 5:52 PM [link]
2nd_ave;
I looked at the Insider transactions you mentioned for BMD.
http://canadianinsider.com/coReport/allTransactions.php?ticker=bmd
It looks like they are excercising the options and getting the shares incredibliy cheap. .34 and .26/share. That is less than 1/10th of the market price.
KRY looks more reasonable
http://canadianinsider.com/coReport/allTransactions.php?ticker=kry
Am I reading it incorrectly?
Posted by: JogyP at
May 3, 2007 7:09 PM [link]
IBKR raised $1.2 billion on Thursday, within a forecast range, with an auction-based IPO.
The 40 million-share offering, increased from 34.5 million shares, sold for $30.01 per share, compared with a $27 to $31 forecast range, according to an underwriter.
Posted by: JogyP at
May 3, 2007 7:17 PM [link]
Go figure. I bid for 2000 shares at $30 through E-trade and it ends at $30.01. I'll be licking myself if I miss a double over 2000 pennies.
Posted by: cb at
May 3, 2007 7:19 PM [link]
oops, I meant kicking myself.
Posted by: cb at
May 3, 2007 7:20 PM [link]
This afternoon has not been kind to me. I inadvertently wiped out my entire Outlook database. May Day!
The Outlook system was not allowing me to copy to Access or Excel as I was trying to set up all my personal files on a safe server, so I tried to force it. Then the program started going crazy, putting 50 sub-category Team Micro links into 800 files, which I could not reverse. So, my brilliant idea, rather than going through 750 records and deleting Team-Micro, was to go to the Master Category list and delete the Team Micro category, figuring I would just need to re-add 50 records, which I could do in a fraction of the time.
The system deleted ALL THE RECORDS -- all the categorized mail, personal notes, names, addresses, all phone numbers, mail categories, you name it. ZAP.
My back up is way out of date after I unplugged my laptop from my desktop, which I once used as a firewall and for daily back-up when my cable/phone/ISP provider installed a Firewall system six months ago that rendered my local network unworkable.
I figured I'd be self-insured, ie, no back-up for a couple months before departing for Bahamas. I'm still here, the first new ISP I went to was a dismal failure, which took over two months to extricate from, and we're just now getting the systems I need up working on a new server/ISP. So one of the final tasks was to export my mail/Outlook files, and sure enough, at the most vulnerable point, Microsoft decides to act like... Microsoft. ZAP.
I still have all your mail, but I'm too beaten up to even think I would spend months to categorize and re-build the file system I had working wonderfully until a couple hours ago.
So here's what I decided. Worse things in life can happen, right? So step one is to accept the loss and move on. Step two is to make plans to get all new software, none of which will be called Microsoft. Step three is to ask you folks who want to stay in touch to send me a V-card and/or mail that gives me your co-ordinates. I'll have those dumped right into the new dbms on my server at the new ISP. Step four: I'll have a techie figure out how to export the mail from an Outlook system (2003 Professional) that doesn't seem to be working properly. Step five, I’ll fwd all mail in the subject headers for Team Micro and Micro-cap 100 to Karl, who is the project manager, and he’ll sort through it to get us back on track in a couple days. And lastly, I’ll now turn off the computer for the day and decide between a G&T, vodka martini or a Cappuccino Bailey’s (double or triple).
Please send v-cards and mail to contacts@billcara.com. Please.
Posted by: Bill Cara at
May 3, 2007 7:28 PM [link]
JogyP,
I'm not concerned with the acquisition value, as that value will often be zero. It's the number of shares that Mr. Jarding ends up owning that will be important, as he will then be compelled to consider the effect on share price of each and every decision he makes. Unlike what happened last summer when the mgmt of Goldcorp showed little apparent concern when pushing an acquisition that dropped share prices substantially.
Posted by: 2nd_ave at
May 3, 2007 7:37 PM [link]
Bill I am sorry to hear of your computer problems. I know that "stuff" can be irritating. Please go with the Vodka Martini for me.
All the best,
Tom
Posted by: golden7 at
May 3, 2007 8:53 PM [link]
Not one but two vodka martinis with a twist. Did the job for me except that I couldn't get past the computer on my way to bed (note: 9:35pm!) without having a final go at the mail.
Posted by: Bill Cara at
May 3, 2007 9:36 PM [link]
Dear Bill,
It's Pinot Grizio that's got this hombre ready for beddie-bye.
Chris
Posted by: shark_attack at
May 3, 2007 9:41 PM [link]
G'Day Kaimu,
I know a couple of the management at Oxiana. They are great guys and top quality management who speak highly of their colleagues.
I like Oxiana but I do not like Indonesia. I lived in Kalimantan for 2 years. Risk is more than I am comfortable with.
I don't know anything about Kalimantan Gold.
The $37 million does seem unusual so maybe there is something there. I will sit on the sidelines with this one as I think there are just as good opportunities elsewhere with less country risk.
PS Geologix Exploration GIX.V is trading at $2.87 today. Waiting on the results from the last 2 drill holes which are due soon and could significantly increase the size of the deposit.
Posted by: Aussieontop at
May 4, 2007 1:00 AM [link]
ALOHA !!
G'day back mate !!! Is the sun out there in the North Country yet?
I know about the Indonesian risk from my best mate who's a petroleum engineer running a rig for Unocal there. My feet are in the water so to speak! But I did dip in more after the Oxiana tip off. Obviously Oxiana has assessed the risk and committed. Thats why I ask about their management and the high stakes down payment they're making to Kalimanatan Gold. I do know Kalimantan has been in Indonesia for a long time and have some government clout there. Perhaps that mitigates the risk a bit for Oxiana.
Yep .... gotcha ... I am following GIX and as I said own shares now and have added on dips. Good on ya! Off to the races indeed ...
Posted by: kaimu at
May 4, 2007 7:41 AM [link]
Dear Bill Cara,
I am a relatively new friend of Danny. I am an active trader, but came across and became friends with him, as a result of his warm Christian personality, in the process of me getting tech support for their system.
This is just a note to tell you that I have been keeping up with the Caring Bridge, and after seeing posts from some of your members, I was choked up. NO, I am not some weak guy who would cry easily, but thing is, this guy is awesome, and to see you take time out to represent him, I am very pleased and impressed by you.
I know he came across you because he realized you quoted the Bible on your site, and he just had to reach you. Now, seeing you reach out for him so others could know and pray for him, man, just amazes me of the power of God, and how he moves us. I should not be amazed at this stage, but something always happens that makes me say... God is awesome.
Anyway, thank you for presenting him on your site, and may God continue to bless you.
Posted by: deOmega at
May 5, 2007 10:08 AM [link]
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hello from germany
UBS Profit Falls as Hedge Fund Losses Hurt Bond Fees
ubs seems to be the "anti goldman"
M3 in europe / Chart
good that the rcb has an official m3 target.....
shiff vs a nuts guy on cavuto / video
Owning a Home in the Suburbs of London / NYT
http://immobilienblasen.blogspot.com/
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at
May 3, 2007 8:11 AM [link]