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Thanks, Eric. Just stopping by for a bit.
Thanks. I just saw the live coverage and felt like posting. I marvel at the magnitude of the move. It's not often you see a major currency move 10% in a day.
Soros has positioned himself for an economic contraction. He likely made a killing tonight.
Since when do you short?
Looks like the markets were wrong. Current results are 51/49 in favor of leaving the EU. The pound is down 15 cents / 9.4%. I guarantee you that a lot of currency traders got wiped out by that move.
Hi, Court. Good to see a familiar face. Missed the old Investors Forecast and Raging Bull days. Thought I'd check things out.
My sentiments exactly.
I question the reason why a home buyer buy a home he doesn't plan to live in. Whether the reason is investment or wanting a vacation home, it's inherently speculative. An empty home is an un-utilized asset. In boom periods, owners tend to overvalue appreciate potential and are tolerant of maintenance expenses. In bust periods, owners tend to undervalue appreciation potential and are intolerant of maintenance expenses.
While I don't entirely buy into the 'animal spirits' line of logic, it does bear out in many cases. I would prefer families were buying homes instead of speculators. Families establish connections, spend money and care about their community. Speculators are disconnected from those issues because they don't live in the area where their homes are located. It's all about aligning incentives.
Hey, Eric. Good to hear from you.
I understand what you're referring to. Electric grid operators have devised economic signals to synchronize production/demand. There are real world limitations that are currently limiting the promise of innovative solutions.
If you don't mind me asking, what industry are you entering. You're an astute trend spotter. Feel free to shoot me a private message. I would love to discuss some ideas.
Interesting, but what is the actionable message to take away from it? That the rich get richer? That the proletariat should rise up? And since this is an investment board, what stocks should people buy?
You're stating US shale has a break even price point of $650/bbl. That's substantially higher than current market value ~$95/bbl. So is the current interest in US shale reserves an uneconomic farce? Did RD Shell squander their resources?
So what percentage/yield is usable?
Your water shortage argument is analogous to Chinese water shortage issues. Shale is located in ND/SD. What does CA's water issues have to do with ND/SD? It's disingenuous to suggest that CA's water shortage issues are analogous to the entire country. What is your real agenda?
I am not discounting your experience. I respect your depth of knowledge. Is it possible that technology has advanced to the point that shale is know viable?
Granted, shale has a high cost of extraction. However, it strikes me as short sighted to not develop local resources. Ignoring the current US prohibition on the export of oil, what is the argument for not developing shale extraction technology?
Comparative advantage? Allocation of limited resources? Shift away from carbon based fuel? What is your argument?
From my standpoint, it seems that technological innovation offers the highest long term value. It is counterproductive to US national interests and international oil companies to not innovate. At the moment fracking, deep sea drilling and shale are the focus.
I understand the appeal of wind, solar, biomass and other renewables. I simply believe that current technological realities favor carbon based fuels at the moment. If we're arguing over short versus long term solutions, that's fine. I'm just trying to make sure I haven't incorrectly assessed the viability of US shale to further domestic energy independence.
Thanks, Nick. It's good to be back.
That's always been the case. The reason the US got on oil, coal and nuclear decades ago was because those three fuels were the most economically efficient. As the price of oil rose and technology improved, refining of sub-optimal sources of oil became economically viable: tar sands, shale, etc. Coal's viability eroded with increased costs associated with environmental regulation. Nuclear suffers from fear of catastrophic disaster. France is on nuclear. I wish the US followed France in terms of electric generation policy.
Solar and wind aren't economically viable in most locations without government subsidies. Hawaii is a notable exception for solar, but it's a tropical island. It has abundant sunshine and naturally high logistical costs of energy production. Wind is largely driven by temperature changes. Areas near large bodies of water or canyons have naturally occurring wind changes that can be harvested. Surges in wind tend to coincide with solar cycles: sunrise/sunset.
Electricity trades by the hour. Sunrise and sunset hours are considering offpeak hours. They sell for much less than onpeak hours, 4pm in particular. It's correlated to business cycles and air conditioning use. So wind has a high cost of production and a low natural selling prices. Everyone thinks you can build giant batteries to store electricity during high production times and sell during high value times, but technology hasn't caught up with the dream yet. I hope it does.
So while there are areas where clean energy are naturally economically viable, carbon based fuels are generally a cheaper source of energy. There are a number of mechanisms to stimulate a shift from carbon to renewable. We're not there yet.
So when you read an article about how a drop in oil prices could devastate renewable fuel markets, know it's true. But global industrialization has increased demand for carbon based fuels and supply/production is limited. Long term, either technology for extraction of carbon fuels or generation of renewable fuels needs to improve.
My background is in oil and gas. Oil companies have a long track record of success extracting fuel and extracting value from the business of supplying fuel. I think they'll find a way to navigate that transition successfully. That may involve acquiring innovators in the renewable energy field. Time will tell.
I hope othera contribute to the discussion. I understand that the trials and tribulations of life often limit discussion. Silence benefits no one.
Speak up. Contribute. Add to the free exchange of ideas. Be part of the discussion. I've shared my thoughts. Perhaps others agree or disagree. Either way, the door is open. Add to the discussion.
Just watched an interview with the Head of Listings at NYSE Euronext on Mad Money. Excellent commentary on the logistics of IPO listings. If you watch it you will gain insight into the logistical limitations of technology, the introduction of change and basic human psychology.
Basically NYSE Euronext is one of a small group of premier exchanges. The overwhelming majority of global companies gravitate towards a short list of financial markets that allow them to expand their business and do what they do better. The FB IPO wasn't a success. NASDAQ OMX was heavily criticized in the aftermath, but it was an aberration in a long track record of success.
The most important message to take away from that story is that the logistical limitations of technology, the randomness of technical issues related to change and basic human psychology impact IPO success.
I've been away awhile. Just wanted to comment on a few news items.
Twitter is this year's Facebook in terms of disastrous IPOs. Even if you love the long term prospects of Twitter, avoid it like the plague the first six months. Although Facebook is infamous among traders for poor post-IPO, it's a model for how entrepreneurs should price their company's IPO. The people who run Twitter would rather reap as much cash up front and sell their restricted stock later at a fair price later than enrich speculators on opening day. They are not interested in transferring the proceeds of their hard work to random speculators.
The SAC settlement will have more of an impact on brokers and clearing firms than market liquidity. And I don't mean brokers like Schwab or E-trade. I mean firms that cater to large hedge funds. Clearing firms are usually connected to international banks. As always, I am bearish on banking in this environment.
The world has changed. Innovators, creators and transformative technology are worth more than money and the companies that manage money. It's no longer difficult to access capital. Capital flows to transformative ideas like a flash flood in a desert. Those who store capital simply try to allocate it in the most optimal manner so they end up with more money.
Oooh, new posts! I can't wait to . . . nevermind. Still no US gulag locations or breakdown of Bush vs Clinto/Obama housing policies. Oh well, maybe next time.
Test. Just making sure US gulag locations and differences between Bush and Clinton/Obama housing policies haven't been posted yet. Looks like they haven't. Inquiring minds want to know, Elroy.
Interesting, but I don't see anything about US gulag locations or Bush vs Clinton/Obama policy differences?
Where exactly are the US gulags located? Which political dissidents have been sent to them? Please list the names of American citizens held in such facilities. Please list the names of foreign NON-combatants held in such facilities.
What were the changes in tax and Federal Reserve policy under Bush that didn't exist under Clinton or were continued under Obama? How are Democratic leaders such as Barney Frank not responsible as well? How are officials at Fannie Mae and Freddie Mac not responsible as well?
Nick, you're wasting your time. Elroy hates republicans and will compare Reagan and Bush to Stalin and Hitler no matter how many times you point out the flaws in that comparison. Besides we all know what his real problem is with republicans and it's not economic policy or national healthcare.
Twinkie prices on Ebay have dropped off a cliff. This weekend auctions for 5 boxes of Twinkies fetched $305 and $890. Now a single box can be bought for $10.
I won an auction for 2 boxes of Ding Dongs and 2 boxes of Cup Cakes for $15.46. That's an average of $4/box. Pricey, but nowhere near the insanity from this weekend.
I associate Hostess with my childhood. I spent hours last night trying to locate a box of Ding Dongs (the foil wrapped creme filled hockey pucks). I visited ten stores and staked out a local store at 6am this morning because I was told there would be a Hostess delivery. There wasn't.
Check out Ebay if you want to see some hilariously overpriced boxes of Twinkies. There's an auction for 5 boxes at $305 at the moment.
The preferred language teaching software of the US military.
http://www.rosettastone.com/learn-spanish
Why master regional accents when you have Rosetta Stone and a likable personality?
I agree that Obamacare will be an impediment to the recovery. However, the brunt of the impact will fall of unskilled and youth labor. Every job I've had since graduating college had great medical and dental benefits. And if companies start laying off workers in droves they'll delay implementation. It's all about jobs.
But if you're right and the country goes to hell, please mail me an empty refrigerator box because I'll need a place to live.
I don't check iHub often, but I just noticed something that I thought was worth sharing:
http://investorshub.advfn.com/boards/profilea.aspx?user=12976
See the shoe icon? Do you know what that means?
http://investorshub.advfn.com/boards/profileimages.asp?fromProfile=12976&fromProfileName=Alex%20G
Nick, Elroy knows more about Hungary than you do. I keep forgetting which former Communist Bloc country you immigrated from in the 50s. I think it's the one whose capital is called Bucharest. I always get that city confused with Budapest. But nobody knows where either are located, so does it even matter? I don't think so. Anyway, enjoy learning about Hungary. I hear it has a rich cultural history.
A lot depends on where you live. I only bought food locally when I was in NYC. Local prices were sky high for most other things. That's why I never understood why foreigners did so much shopping in NYC. I understand that some electronics can't be exported or face extremely high tariffs abroad. But why not just get a PO Box, order online, catch a show, enjoy a meal and fly back with all your new bargain priced goodies?
You might want to buy a thicker shirt, your Naples are showing.
Hire illegal aliens?
If Ryder starts reporting record truck rentals in your area, leave immediately! In all seriousness, I think the country will come out of the next few years stronger but it's going to be a painful experience. It's going to be a return to basics and living within your means. That's a total reversal of fortune for post-Baby Boom America.
Retail opinion. I don't normally comment on the retail sector but the last two weeks have caused me to form a very strong opinion about three companies: Amazon.com, Apple and Best Buy. Basically, I've had several exceptionally positive experiences at Best Buy recently. I was impressed by the breadth and depth of knowledge displayed by several members of Geek Squad, sales associates and management at the flag ship Houston location.
This caused me to shift many of my online purchases from Amazon.com to Best Buy. The specific issues that caused me to shift purchases were product knowledge, technical support, price match policy, convenience and feeling like they cared about me as a customer. I think the new CEO of Best Buy is successfully turning around the retailer and that it is poised for relative outperformance against its peers (Amazon and Apple in particular).
While I like Amazon, I find their customer reviews hit or miss. I occasionally buy precision instruments and the reviews are heavily skewed by the end user occupation and intended use. So you have to hope that several people with different occupations/intended uses chime on the same product to get a well rounded view of the equipment. I had to fight with Amazon to get a #3.50 credit related to their shipping error. And I mean that. I had to fight tooth and nail to get that refund and they processed it as a goodwill credit not a shipping error.
I hate Apple's attitude towards customers. If you go to an Apple store you will see a massive complex dedicated to a relatively small range of products. You will hear staff hype the iPhone 5 even though it's inferior to the 4S and is 1.5 years behind the Samsung Galaxy S3. You will have to consult a "genius" if you want to do anything with your iPod other than listen to music. You still can't use an iPod as a flash drive and Apple has done NOTHING to remove DRMs put on pre-2009 iTunes purchases. Apple thinks their customers are morons and that customer data is Apple Data. If it wasn't for fanboys and hipsters, Apple would be selling off HARD right now. It's only a matter of time because they lose their cool factor. And, trust me, cool factor is the ONLY reason anyone is buying an iPhone right now.
LOL! Honorary Consul plates are akin to Honorary Degrees. They're badges of honor for palm pressers, social climbers and influence peddlers. She qualifies as all three.
The market acts like there's only one disaster per day: Greece, European recession, Obama's re-election, Iran's saber rattling, Syrian civil war, etc. I can't wait until people realize that critical mass has been reached and it's time to batten down the hatches.
Goldman is a lightning rod for criticism, but the problem is more pervasive. The real problem is that there's a natural conflict between fiduciary responsibility and firm profitability. I think that conflict can be ethically managed to yield high quality advice and a profitable business, but the rules are typically written by the individuals who most benefit from increased profitability. There has to be a balance.