Friday, March 30, 2007

V-SUV Day - Friday, March 30, 2007.

GM testing the waters on bringing high mileage mini-cars to the US.

BusinessWeek: GM VP: Considering Efficient Mini Car.


General Motors Corp. GM's top global product planner said Friday the company is taking a serious look at bringing low-cost mini cars to the U.S. market capable of achieving as high as 50 miles per gallon of gasoline and breaking ground in a virtually nonexistent segment in the world's biggest auto market.

GM Group Vice President John Smith said the auto maker is still in very early stages of investigating the U.S. market's appetite for mini cars. Such vehicles are significantly smaller than sub-compact cars currently sold in the region by several players. GM sells a Chevrolet Aveo sub-compact car in the U.S., but nothing smaller.

Thursday, March 29, 2007

Rounding up The Usual Suspects.

Jim Rogers, Boone Pickens, and Matthew Simmons all popping up today and, each in his own way, intentionally or not, stoking the bull market in oil that's re-exerting itself. Although the economy's looking funky, so far there's no sign of it in gasoline demand.

Has oil got it's mojo back? It certainly looks like it. $75 before $55, Boone Pickens says, and that looks reasonable.

Bloomberg: Jim Rogers.

CNBC: Pickens Tells CNBC: Fundamentals Pushing Up Oil, Not Politics

CNBC: Oil Supply Shock.

Friday, March 23, 2007

On the homebuilders in 2007: A-B-S.

Glengarry Glen Ross:

Moss: What's your name?

Blake: *&^% YOU, that's my name!! You know why, Mister? 'Cause you drove a Hyundai to get here tonight, I drove a eighty thousand dollar BMW. That's my name!!


Because only one thing counts in this life! Get them to sign on the line which is dotted! You hear me, you &^%$#@ &*$%&$&?

(Blake flips over a blackboard which has two sets of letters on it: ABC, and AIDA.)

Blake: A-B-C. A-always, B-be, C-closing. Always be closing! Always be closing!!


Moss: You're such a hero, you're so rich. Why you coming down here and waste your time on a bunch of bums?
(Blake sits and takes off his gold watch)

Blake: You see this watch? You see this watch?

Moss: Yeah.

Blake: That watch cost more than your car. I made $970,000 last year. How much you make? You see, pal, that's who I am. And you're nothing. Nice guy? I don't give a ^&$@.


I can go out there tonight with the materials you got, make myself fifteen thousand dollars! Tonight! In two hours! Can you? Can you? Go and do likewise! A-I-D-A!! Get mad! You sons of bitches! Get mad!! You know what it takes to sell real estate?
(He pulls something out of his briefcase)

Blake: It takes brass balls to sell real estate.


And on the homebuilders in 2007, I say:


A-always, B-be, S-shorting.

Always be shorting!

Always be shorting!!

I'm being slightly tongue in cheek here, but I imagine that there were scenes in the real estate/mortgage business over the past few years that had some interesting parallels with the above scene.

What a mess. And they really jammed 'em in at the end, didn't they?

Still probably some meat on the bone on the short side, I think, and Centex is a particular 'favorite' of mine; Florida, California, up and down the coasts, what more exposure could you ask for?

Scary reading:

The Economist: Cracks in the Facade.

And the always great blog that covers the housing mess: Calculated Risk.

Saturday, March 17, 2007

An Inconvenient Investment.

Gonna have a little trouble explaining this one to the kids, but hey, if Soros can buy Halliburton and keep a straight face..

Green Car Congress: Study: Warming Causing Decline in Global Crop Production

Thoughts: DBA, CNH, TNH, DE, ADM, MON.

Most are extended, buy on pullbacks that bounce off trendlines.

Thursday, March 15, 2007

Jim Rogers: Get the heck out of emerging markets.

There are no two ways about what Jim Rogers is saying here. Will he be right? Probably. Keep in mind, he recognizes things before others do, but he tends to be a little early.

Reuters: Top investor warns of Russia stock bubble.

Reuters: Top investor sees U.S. property crash.


"This is the end of the liquidity party," said Rogers. "Some emerging markets will go down 80 percent, some will go down 50 percent. Some will most probably collapse."

He says he'll still hold Chinese stocks though.

Thursday, March 01, 2007

A warning shot.

CNBC: Jim Rogers on Commodity Moves.

Summary: Jim Rogers believes the sell off on Tuesday was a warning shot, and that there is further to fall as we are overdue for a stronger correction; he points out that there are gigantic amounts of liquidity in the system and believes something is going to happen to change that, and then lots of things are going to unravel. In terms of problem signs, he highlights housing starts, autos, the yield curve, sub-prime debt, and margin debt at an all time high. He suggests raising cash, selling short, or buying currencies other than the dollar, and he is bullish on agricultural commodities, utilities, and - strangely enough - airlines. [Not mentioned here, but Air China is a pick of his, but let it stabilize first.]

CNBC: Making Fast Money.

Summary: Jeff Macke says hold off on buying, and wants to buy higher risk, later; suggests waiting for the other shoe to drop, as he believes this is the first part of a multi-tier sell off, and is looking to buy towards the end of March. Tim Strazzini likes the semiconductors after we turn. Eric Bolling likes gold, oil, refiners, and foreign currencies (highlights FXE ETF). Guy Adami also says hold off, looking to buy Apple, South Korea and Taiwan ETFs when we bottom.

CNBC: U.S. Hits Record For Energy Demand.

Summary: Lest we forget our primary focus, US oil demand in the past 4 weeks was huge. Traders are keeping an eye on the macro picture (the economy) though, because oil demand should be affected if the economy deterioriates.

My own thoughts:

I think there is more work to be done on the downside. I also like agricultural commodities and Apple. My sector screen highlights SMH (semiconductors) as Tim Strazzini mentions. I am personally skeptical on this, but usually I hold my nose and trade this screen. Usually.