Moody's, S&P credit ratings

Moody's and S&P are a biased and corrupt source of credit ratings. I have full confidence that neither of them will strip the US of their AAA status anytime in the near future.  However, look for them to continue dropping the hammer on Spain, Italy, Portugal, Ireland, and Greece.

Good Ways for the Common Investor to Capitalize on Market Woes

Don't let your investments suffer if the market suffers!!!! What can the average, not too serious investor buy to capitalize on a falling market?

My answer: Inverse ETFs (same as shorting, but you don't need a margin account)

Heres a list of my favorites to invest in right now

SH - short the S&P500

SDS - short the S&P500 2x leveraged

SPXU - short the S&P500 3x leveraged

DOG - short the Dow

PSQ - short nasdaq

I list the short dow and nasdaq etfs for reference but its better to be short S&P right now. I see an easy 20%+ here from (SH) over the next 2 years.

Comic Relief, people used as colateral on loan!?!?!

This just in:  the Bankia savings group, a banking company in Spain, is actually using soccer players Christiano Ronaldo and Kaka as colateral on a loan made to the Real Madrid football club.  Upon default on the loan, the bank would have the athority to actually seize the players from the team, and would obtain all rights and profits the club has relating to the players.

1971

This was the year the music died.  Its been a thrill of a ride into the record books; the U.S. dollar and a basket of other currencies now share the record as being "the longest lasting fiat currency" at just 40 years.  The reason I bring this up is that we while the doctors at the federal reserve have diagnosed us with the deflation, it is plain to see that their treatment causes severe inflation.  Not one currency has ever died from the deflation; its like the chicken pox, it sucks for a while but when you get over it you're cured for a lifetime.  Inversely, hundreds of currencies have died from the inflation.  The ultimate black swan is on its way, post up.

Credit Default Swaps spike

Credit Default Swaps on the United States government have spiked immensely in the past few months.  Seemingly there are a lot of people out there holding the belief that we will default sometime sooner rather than later.

In other news:
Bonds and Credit Default Swaps explained:
http://richnewman.wordpress.com/2007/12/09/a-beginners-guide-to-credit-default-swaps/

Pretty good stuff to know

Long Term Value Portfolio

Portfolio Picks:

Ticker          |            Risk         |      About Investment

     

EPIBX            Very  Very Safe          foreign bond investments in reputable/trustworthy nations (No US bonds obviously)

EPIVX             Very Safe                 fund that value invests in foreign nations with high growth and good outlook

EPD                  Safe                       Oil pipelines + energy transportation, history of steadily increasing dividends

CH                   Safe                        Fund, invests primarily in exponentially growing Chilean economy.

LYSCF             Moderate               Newcomer to rare earth metals industry, http://www.lynascorp.com/

RIO                  Moderate                Gold/Silver mining corporation

SIVR                Moderate                Silver

List of Yearly Dividend Yield

EPIBX      5.49%

EPIVX      3.31%

EPD          5.54%

CH           10.0%

LYSCF     none

RIO          1.75%

SIVR        none

Correcting my previous post,

SNDK jumped huge in early morning trading due to the earnings report, more than I had anticipated in my previous post so let me correct the numbers.  *Easy 10% or ~50% on call option

SNDK, VZ

Sandisk (SNDK) beat earnings forcast, you can now sell.  Congrats to anyone who bought SNDK when I said to on July 18th, you made an easy 5-6%, or ~20% on your call option.  No harm in holding on a bit longer, it has tremendous upside.  However, I'm more content to sell off now and reevaluate when the U.S. and Greek debt crises stabilize a little more. 

Also, looking forward to verizon earnings report tomorrow.  Forcasts for VZ have been pretty good last few years so i'm inclined to say it won't differ much from the forecast.  Still waiting for the stock to feed off of some of this apple hype.  Clearly apple is rocking the house.... but who else benefits from record selling of Iphones, IPads, and Macbooks?  VERIZON, SANDISK, CISCO !!!  There are more, but you would have to read cody willard's "50 stocks for the app revolution" to get the full spectrum.

GREECE, sim city

Since when is financing old debt with new debt a bailout??  A default for greece would surely be better than current bailout terms, which would just prolong greek destruction for a while.  Has nobody on this planet played sim city??????  Every good sim city player knows that after a certain point in debt it is nearly impossible to recover because the maximum amount you can get in taxes isn't enough to cover interest payments and be able to grow enough to alleviate debt. Plus if you have taxes without services to your people your people leave the country and your revenue decreases..... The only way out of the debt is to pretty much neglect your population and sell a ton of water and power to your neighbors, and even then surplusses after the interest rates on debt are minor.  I think we should all play sim city, it will teach us all how doomed debt plagued importer nations are.

Wait Wait... People are surpised?

"Nasty Surprise in Housing"
http://www.marketwatch.com/story/sales-of-existing-homes-slip-08-in-june-2011-07-20

For All Who Were in Doubt.

The answer is yes, there are people alive today that predicted the 4 biggest economic crisis of the last decade:  Internet Stock bubble of the Early 2000s, 2003 Recession, 2007-2008 Housing Bubble crash, and 2008 recession/financial crisis.  

They are few and far between

http://www.youtube.com/watch?v=tZaHNeNgrcI

Hold on SNDK Until Earnings Report

I'm expecting Sandisk to beat estimates of .99 per share with numbers around 1.09 a share.  Looking to sell on 7/22/11.  Updates to follow

Follow up to SNDK play,

Apple blew earnings numbers out of the water, SNDK apears to be uncoupled and moving independently.  While it posted gains yesterday and opened higher today, it does not appear that it is benefiting in the short term from apple's numbers.  Oh well, next time we'll go with the less creative play and just buy apple : ). 

BAC fail

Bank of america comes out with positive earnings report numbers and still takes a dive, you just can't catch a break when your drowing in toxic assetts, regulated to the max, and being investigated for accusations from the last financial crisis.

QE explained, a classic

QE  and the fed explained

http://www.youtube.com/watch?v=PTUY16CkS-k&feature=related

BAC, AAPL Earnings Report Playbook

First off, BAC down again on bad news, I hope you were shorting it.  If by some mericacle it makes a bull run sometime in the next few weeks I would use that as an opportunity to short harder.

Now, down to business.  Apple's Q3 earnings report comes out tomorrow,  and i'm going to make a creative play on it.   Apple has beat earnings reports for at least the past 8 consecutive quarters, and I don't think it will come as much surprise if apple beats it again by a moderate margin.   Apples been skyrocketing lately, and I'm worried gains from their earnings report have already been priced in.  Thats okay,  I have a safer play.   SNDK (sandisk)  got killed today in the markets when their price target was downgraded.  However, they benefit from apple revenue and they have an earnings report of their own coming out thursday.  Point being this seems like a great short term buying oportunity.

JPMORGAN

Is it just me or is are the October and September Call/Put prices lagging behind the stock price?  Looks like low volume may be a culprit, we'll see if it corrects at all on monday.  

food

Food prices up 2%, thank you Bernanke for discouraging obesity in America

QE3!!!!!!!!!

In the Fed chairmans speech this morning, he hinted at a third round of quantitative easing, saying he would provide further support using one of a few possible methods, all of which involve stimulatation and attempts to keep the interest rate low. 

That being said, I hope someone took my July 5th advice and bought silver while it was down (who am i kidding, there are about 3 people that even look at this blog, bless their souls).  QE3 was bound to happen, and it's going to push silver back to ridiculous levels.  Silver is up 10% from july 5th, and up 20% on the year, even after a setback in may which saw it drop more than 25%.  Look for a return to above 45$ when the federal reserve decides to intervene to "promote growth" and "stabilize the economy".  I do not beleive this to be a question of if, but a question of when. 

Full Default in Greece Now Seems Likely

Bailout talks are not going too well accross the pond.  All of our funny accented friends over there in europe are feeling troubled.  Greece is just the tip of the iceberg with spain, italy, portugal to follow.  Decisions in greece may very well set a precedent for how the rest will be dealt with.  While I don't claim to be exited about the demise of all these countries, I am positioned to benefit from them with puts on JPM and GS.  The default will be better for the region in the long run.  If the decision is for greece to default, its party time for me.  I would try to pick up some more securities specifically to gain from greece's demise, but alas, they have already been hit pretty hard in the market. 

Early Warning, Bank of America (BAC) Settlement Not Over, Grim Outlook

See this article from zerohedge.com, news of the banks recent settlement was premature.  BAC is near a 52 week low today, and there it doesn't have much going for it in the coming months.  I wouldn't mistake this as an opportunity to buy.

http://www.zerohedge.com/article/congressman-brad-miller-blasts-legality-bank-americas-85-billion-rmbs-settlement

Beating Dead Horse, LYSCF

I know i've been blowing the horn on Lynus Corporation a lot.  If you couldn't tell, i'm a fan.  I've some numbers to look at comparing some popular rare earth metal companies, specifically I want to look at trading volume.

Company                                       Average Trading Volume

MCP                                               6.46M

REE                                                 1.64M

AVL                                                 2.20M

GWG                                               1.08M

LYSCF                                            952,220

Lynus Corporation is the least traded of the big rare earth metal stocks.  The size of their operation and mining potential threatens to be the greatest of any rare earth metal mining company, including molycorp (MCP).  Apparently the secret isn't out.  Lynus's market cap is ~78% of Molycorp's, but their supply of rare earth metals in the coming year is going to be equal if not greater.  Lynus also reaps the benefits of a stable, strong currency in the Australian dollar.  Sure, Lynus isn't at full scale production yet, and they have just begun mining operations, but when the cat gets out of the bag this is going to be a good one.

The Lights are Dimming

One day, a long long time from now, I will speak to my grandchildren and tell them that I lived through the second great depression.  That is, if I am lucky enough to live that long.

Metals, Google, LPS, LYSCF

Silver in recent times has proven that it can have a good day even amongst negative indicators.  It consistantly acts about twice as volatile as gold.  I've been bullish on silver for over a year now, and it's looking to make a run up to $45 or so before I'll start looking back again.  Evaluating the LPS short by Cody Willard in May, it seems this was absolutely spot on.  LPS has lost ~33% since Willard voiced that the company was in shambles.  Around yesterday the CEO resigned due to medical reasons.... clearly it doesn't seem like things are getting better.  If it makes a bull run in the next week or so I might try to squeeze in a put.  FWIW Willard also bullish on google over the next six months.

After a project delay LYSCF is rebounding, still a fist pumping buy. 

SIVR a buy at $33.66

Silver has been on a bit of a downtrend recently and now looks to be an attractive buy.  Look for a turnaround in precious metals over the next six months.

Trading Ideas for Zynga IPO

Zynga, the next to jump on the internet tech IPO trend filed paperwork for their IPO today, looking to raise 1 Billion.  This is the game company that created farmville.  They don't have any other real significant titles, but they're well connected to facebook and have proven that they can reach a large audience and get people to pay for their games. 

http://news.cnet.com/8301-19882_3-20075220-250/zynga-ipo-like-facebook-but-sharper/

Zynga seems to be causing alot of exitement.  I don't see a reason why the IPO won't behave similar to linkedin or pandora.  That being said, I think everyone on wallstreet knows exactly how they are going to play this one.

Buy Buy Buy............get in before the crowd.  Then take profits and run, sell before its too late.  This IPO is going to garner an uncanny amount of public exitement.  I'm getting in and getting out. 

Long term growth prospects??? Haha, don't kid yourself, this is an internet gaming company.