Search found 225 matches

by cato
Sun Apr 04, 2010 1:15 pm
Forum: Investing - Theory, News & General
Topic: Value stocks: The risk story
Replies: 6
Views: 1639

The problem with book value is that many of its components (bldgs, equipment, etc.) may be valued on acquisition price rather than current market price. In the current environment, that means book value may vastly overstate actual liquidation value.
by cato
Fri May 08, 2009 9:09 pm
Forum: Personal Investments
Topic: Bubble spotting
Replies: 23
Views: 3770

Re: Bubble spotting

First let me say I love your tagline "Citigroup delenda est"! And is sounds like you've made some smart moves- more power to you! But the reality is, there are 99 other catos out there (cato1, cato2, cato3,...cato99) who thought their market timing skills were just as good and failed mise...
by cato
Fri May 08, 2009 8:37 pm
Forum: Personal Investments
Topic: Bubble spotting
Replies: 23
Views: 3770

Re: Bubble spotting

Is it at all possible to identify something so extreme as the tech bubble or the housing bubble before they crash? .... So, are extreme bubbles actionable? The answer to the first question is emphatically Yes. There are a number of ratios that tend to revert back to their means over time. When thes...
by cato
Tue May 05, 2009 7:45 pm
Forum: Personal Investments
Topic: Foreign Bond Funds?
Replies: 28
Views: 5281

I'm always amused at articles recommending obscure ETFs without bothering to mention the complete and utter lack of liquidity in them.

Take BWZ for example. It traded 450 shares today. With $15K to invest, you would have been the entire day's volume!
by cato
Tue Apr 07, 2009 11:24 pm
Forum: Investing - Theory, News & General
Topic: Is the sky really falling?
Replies: 106
Views: 25118

One thing that gives me pause with the dividend yielding stocks is just how many people seem to be praising them these days. "Just buy the companies that have managed to increase their dividends in the last 12 months....." I feel like I hear that everywhere from Jim Cramer to Kiplinger's, ...
by cato
Mon Mar 30, 2009 7:37 pm
Forum: Personal Investments
Topic: Option calls - getting started
Replies: 22
Views: 3351

Re: Risks

That's the biggest downside to your strategy; you're giving up the benefits of owning equities (the unlimited potential upside) for the immediate receipt of income. I've seen strategies that are much worse than what you're doing. I don't think that strategy is for me, but it might work just fine fo...
by cato
Mon Mar 30, 2009 5:58 pm
Forum: Personal Investments
Topic: Option calls - getting started
Replies: 22
Views: 3351

Re: Risks

Your example 2 is, I think, writing naked calls. There is no faster way to lose money than writing naked calls. It is a ludicrously risky strategy. I guess I wasn't clear enough in the original post. It was supposed to be 1) Slightly out-of-the-money covered calls 2) Deep-in-the-money *covered* cal...
by cato
Mon Mar 30, 2009 10:05 am
Forum: Personal Investments
Topic: Option calls - getting started
Replies: 22
Views: 3351

Re: Black swans

It is very likely that your multiple years of nice returns will be more than wiped out when the black swan arrives. This strategy only makes sense if you're investing other people's money. That's utterly disingenuous. You are confusing the use of deep-in-the-money covered options with using leverag...
by cato
Sun Mar 29, 2009 5:53 pm
Forum: Personal Investments
Topic: Option calls - getting started
Replies: 22
Views: 3351

I do a fair amount of covered option writing. If you are interested in trading options that's a safer way to go. You can write either Puts or Calls. here are some scenerios: #1 Expect modest moves in the market. ----------------------------------------- Suppose I want to hold the S&P 500 index, ...
by cato
Sat Mar 21, 2009 10:15 am
Forum: Investing - Theory, News & General
Topic: Where's the outrage!
Replies: 3
Views: 1408

Where's the outrage!

The NY Times is running an article about people who are losing downpayments because they can't get loans: http://www.nytimes.com/2009/03/22/realestate/22cov.html One doctor and his partner were buying a $1.7 million condo, but couldn't because the lending requirements went up. The doctor says: “It’s...
by cato
Mon Mar 16, 2009 11:20 pm
Forum: Personal Investments
Topic: Suggestion for Free Personal Portfolio Management Software
Replies: 10
Views: 3539

That's easy:

http://www.fundmanagersoftware.com/


Nothing else comes close. They have a free trial.
by cato
Sun Mar 08, 2009 1:21 pm
Forum: Investing - Theory, News & General
Topic: Trump venture folds, leaving buyers strapped
Replies: 33
Views: 5150

SP-diceman wrote:Donald: Your fired!!!


Thanks
SP-diceman

No. You're fired for your abuse of our language..
by cato
Fri Mar 06, 2009 11:11 pm
Forum: Investing - Theory, News & General
Topic: Cramer: Worst-Case Dow View is 5320
Replies: 25
Views: 4997

Dutchgirl wrote:After seeing Cramer eviscerated on the Daily Show with Jon Stewart, can anyone still listen to, let alone repeat, his pronouncements?

Yoka
I've seen Cramer. Who is Jon Stewart?
by cato
Tue Mar 03, 2009 11:51 pm
Forum: Personal Investments
Topic: VWO down 3.9%; EEM up .5%
Replies: 4
Views: 1723

Thanks guys. No way I would have ever guessed ^HVO. Yahoo seems to use ^ETF-IV for every other ETF in the world seems to be
by cato
Tue Mar 03, 2009 11:12 am
Forum: Personal Investments
Topic: VWO down 3.9%; EEM up .5%
Replies: 4
Views: 1723

VWO down 3.9%; EEM up .5%

These two developing country ETFs tend to track each other pretty closely. I c an get the IIV for EEM but not for VWO, so it's hard to tell what's happening. Anyone know?

I'm thinking this might be a good opportunity for TLH.
by cato
Sat Feb 28, 2009 12:11 pm
Forum: Personal Investments
Topic: Still time to buy TIPS
Replies: 11
Views: 4221

There are two reasons for nominal treasury rates to increase: 1) Anticipation of an oversupply and resultant inflation. 2) Higher perception of default risk (yes, I mean risk of US Govt default). If we believe the market is acting rationally, the fact that TIPs and nominal rates are increasing in lo...
by cato
Thu Feb 26, 2009 12:24 pm
Forum: Personal Investments
Topic: 529 plan that allows emerging markets allocation?
Replies: 22
Views: 4096

Is there some compelling reason to locate 100% EM in the 529 location? In index form, I think it can be quite efficient in a taxable location, and of course there are other advantages to that as well. My thinking is to put the high-risk/high-return stuff in an account where it can be withdrawn with...
by cato
Wed Feb 25, 2009 11:40 pm
Forum: Personal Investments
Topic: 529 plan that allows emerging markets allocation?
Replies: 22
Views: 4096

529 plan that allows emerging markets allocation?

30 minutes with Search hasn't turned anything up... So I'm wondering, does anyone know of a 529 plan that allows you to specify an allocation to emerging markets? The best I've found so far are the plans that include the Vanguard Int. Index (some part of which is emerging) and the West Virginia 529 ...
by cato
Fri Jan 09, 2009 4:36 pm
Forum: Investing - Theory, News & General
Topic: Now I'm worried.........
Replies: 14
Views: 3239

He got laid off 10 months ago, with a 10 month severance package, and yet he had to drain a big chunk out of an IRA and his 401k? Plus, that this guy is 61 and was planning on retiring at 66.... with what? I'm curious about the pay too. I had a buddy who *started* at a higher pay rate at GS, and th...
by cato
Fri Jan 09, 2009 3:53 pm
Forum: Investing - Theory, News & General
Topic: Now I'm worried.........
Replies: 14
Views: 3239

Re: Now I'm worried.........

spangineer wrote:
Are you sure it's not that fewer people are coming in for regular checkups?

It's an endodontic practice. They don't do checkups -- just root canals for acute cases. It's not really elective care. You get a root canal or an extraction.....or you suffer like h***.
by cato
Fri Jan 09, 2009 3:18 pm
Forum: Investing - Theory, News & General
Topic: Now I'm worried.........
Replies: 14
Views: 3239

Now I'm worried.........

For anyone who lived through the 70s and 80s recession, the GDP and employment numbers don't look all that bad. 7.2% is nothing compared to what we had in '82-'83. However, I just discovered that the endo/dental practice my wife works for has had a massive slowdown. That's right, people in Silicon V...
by cato
Thu Jan 01, 2009 12:27 am
Forum: Investing - Theory, News & General
Topic: Hot off the Press
Replies: 5
Views: 1860

Re: Hot off the Press

Just found this crystal ball forecasting @bloomberg "Ten of the 11 investment strategists surveyed by Bloomberg expect the S&P 500 to rise next year. The forecasts range from a drop to 874 at Barclays Plc to a gain to 1,300 at UBS AG. The average is 1,056" Ken Fisher is not my favorit...
by cato
Thu Jan 01, 2009 12:21 am
Forum: Personal Investments
Topic: Who has made money this year from their investments?
Replies: 16
Views: 4211

Not me, but my brother-in-law scored a major windfall when his high-tech company was bought by a Fortune 500 company in Fall '07. He completely disregarded all my advice to get in index funds and hold for the long haul at S&P levels of 1200, 1100, 1000, 900, and 800. Instead he put all his money...
by cato
Tue Dec 30, 2008 10:31 pm
Forum: Investing - Theory, News & General
Topic: The state of California
Replies: 88
Views: 15365

Met Income wrote: I'm surprised someone with the name of cato believes there are exceptions to supply and demand.
Huh? Supply and demand don't ever apply when the coercive force of govt. is involved, as it is in lawsuits. That's why someone named Cato is apprehensive about expansive govt.
by cato
Tue Dec 30, 2008 12:37 am
Forum: Investing - Theory, News & General
Topic: The state of California
Replies: 88
Views: 15365

It's the law of supply and demand. The lawyers would vanish if the public didn't give them enough fees. Unfortunately that's not the case. Lawyers, like govt. occupations, are not subject to supply and demand. Law firms operate more like mafia protection-money rackets. I've been represented in coun...
by cato
Mon Dec 29, 2008 2:50 pm
Forum: Investing - Theory, News & General
Topic: The state of California
Replies: 88
Views: 15365

California has more lawyes than Japan has engineers :lol: Lawyers congregate where they are needed. Or where a tort system of "jackpot justice" prevails -- a system devised by.... lawyers. Here's what happens when you increase most professions: More bakers => more bread => everybody's bet...
by cato
Sun Dec 28, 2008 5:30 pm
Forum: Investing - Theory, News & General
Topic: The state of California
Replies: 88
Views: 15365

Could not agree more. I don't get how the state can't make ends meet. It can't do it in relatively good times either. Really? Did you know California is opening a brand new law school at UC Irvine? The school's expectation is that none of the students will pay any tuition at all: http://www.law.uci...
by cato
Sun Dec 28, 2008 5:17 pm
Forum: Personal Investments
Topic: Dividends, dividends, dividends.
Replies: 27
Views: 5614

....Offtopic, but this is one of the reasons that I have never been an owner of Google..... You could hardly have matched my feelings on this more precisely. At the end of the day, an asset is worth the discounted value of the income it generates to its owners. If your stock doesn't generate income...
by cato
Sat Dec 27, 2008 12:10 am
Forum: Investing - Theory, News & General
Topic: CNBC becomes a parody of itself
Replies: 14
Views: 3590

I'm amazed that people bother watching CNBC. The OP must have a lot of spare time. Actually, it was on XM radio in my car. But, yes I have spare time since I retired 7 years ago at age 40, thanks to some succesful market-timing of my own. I'm glad that you were a succesful market-timer. Most are no...
by cato
Fri Dec 26, 2008 8:31 pm
Forum: Investing - Theory, News & General
Topic: CNBC becomes a parody of itself
Replies: 14
Views: 3590

chaz wrote:I'm amazed that people bother watching CNBC. The OP must have a lot of spare time.
Actually, it was on XM radio in my car. But, yes I have spare time since I retired 7 years ago at age 40, thanks to some succesful market-timing of my own.
by cato
Fri Dec 26, 2008 4:51 pm
Forum: Investing - Theory, News & General
Topic: CNBC becomes a parody of itself
Replies: 14
Views: 3590

CNBC becomes a parody of itself

I flipped on CNBC today to hear an interview with one of this year's most succesful coin-flippers -- er, I mean market-timers. The interviewer was asking breathlessly about how he uses a combination of "technical" analysis and astrology. Yes, that's right, astrology. I checked the calendar...
by cato
Mon Dec 22, 2008 12:28 am
Forum: Investing - Theory, News & General
Topic: The Economist and a better alternative....
Replies: 34
Views: 6701

Re: The Economist and a better alternative....

To be fair, you are looking at the Christmas edition, which always has more lighter content. Bingo! What would you rather read -- Time magazine, where you can learn everything you never wanted to know about Britney Spears? When I was in college, I sat on a plane next to a Time employee. Being an ob...
by cato
Sat Dec 13, 2008 9:23 pm
Forum: Personal Investments
Topic: Any investment magazines beating the indexes?
Replies: 12
Views: 2674

Re: Any investment magazines beating the indexes?

I think you may not understand what is going on here. This is a joke on those who BELIEVE that these magazines are giving REAL advice on stocks. The joke is on the reader who buys the stocks(well, actually the magazine). . . . I think they collectively cost me about $90/year. It's still worth it. F...
by cato
Sat Dec 13, 2008 5:05 pm
Forum: Personal Investments
Topic: Any investment magazines beating the indexes?
Replies: 12
Views: 2674

Any investment magazines beating the indexes?

This time of year, it's entertaining to see the various investment periodicals comparing their January stock picks against the indexes. So far, I've gotten Smart Money, Money, Kiplingler's, and Fortune. They've all underperformed the S&P for the year -- in one case by over 12%. That includes pic...
by cato
Fri Dec 05, 2008 12:21 am
Forum: Investing - Theory, News & General
Topic: Treasuries....the next bubble?? sure look like it
Replies: 16
Views: 3586

djw wrote:One analyst summed it up today by saying he feels the market is about to make a sharp move upwards or downwards....


I can practially guarantee you, it will do both. I'm just not sure about the order.
by cato
Thu Dec 04, 2008 11:51 pm
Forum: Investing - Theory, News & General
Topic: Treasuries....the next bubble?? sure look like it
Replies: 16
Views: 3586

oneleaf wrote: Don't leave us hanging! What are you predicting exactly?
I think the Strait of Hormuz stands a good chance of being mined within the next few months, in retaliation for actions (or just threats of actions) of other regional powers against Iran.
by cato
Thu Dec 04, 2008 11:07 pm
Forum: Investing - Theory, News & General
Topic: Treasuries....the next bubble?? sure look like it
Replies: 16
Views: 3586

Well, I did exactly that: * Long Munis * Long TIPs * Short nominal treasuries (via TBT) I chickened out of the TBT position a while back (luckily). Being somewhat of a Mideast expert, who reads the local papers, I think there's a black swan coming. Not good to be short treasuries for that reason. Lo...
by cato
Tue Dec 02, 2008 11:57 pm
Forum: Investing - Theory, News & General
Topic: 6 PIMCO muni funds cancel divs declared 11/3/08
Replies: 15
Views: 3913

You might consider switching to some of the Nuveen funds. These are trading at 20%+ discounts to NAV, pay good distributions and have ample coverage under the 1940 law. Here are some CA examples with Yield, Avg. grade, % pre-refunded, 1940 law coverage: NPC, 6.9% AAA, 29%, 290% NCL, 7.1% AAA, 15%, 2...
by cato
Tue Dec 02, 2008 11:53 am
Forum: Investing - Theory, News & General
Topic: 6 PIMCO muni funds cancel divs declared 11/3/08
Replies: 15
Views: 3913

Cato or others, Where did you find your data on the short position you described? What fund is it applicable too? Bill Go to this page: http://www.allianzinvestors.com/closedEndFunds/profile/PZC/performance.jsp Then click on the "complete portfolio" link: http://www.allianzinvestors.com/d...
by cato
Mon Dec 01, 2008 6:15 pm
Forum: Investing - Theory, News & General
Topic: 6 PIMCO muni funds cancel divs declared 11/3/08
Replies: 15
Views: 3913

Actually it's much more interesting than just leverage and ARPS.

These funds actually had substantial SHORT positions in 30 year treasury bonds. Presumably this was to protect against a rise in overall LT yields. Ooops!
by cato
Sat Nov 29, 2008 11:12 am
Forum: Investing - Theory, News & General
Topic: Where Interest Rates Are Headed
Replies: 10
Views: 2489

Re: Where Interest Rates Are Headed

The Fed meets on December 16th. Interest rate futures suggest interest rates falling by 50 bp..... This is really academic or irrelevant, since they have already driven the rate way below that through open market operations: http://www.federalreserve.gov/releases/h15/current/ The only important inf...
by cato
Mon Nov 24, 2008 10:12 pm
Forum: Investing - Theory, News & General
Topic: Who is Mr. Market?
Replies: 18
Views: 2736

He's got a fat tail.
by cato
Mon Nov 24, 2008 1:34 am
Forum: Personal Investments
Topic: What causes a stock price to go down?
Replies: 19
Views: 3185

Die Hard wrote:How long does it take for a sale like this to list on "Insider Transactions" once the transaction takes place. Isn't it like 48 hours or something..
The Form 4 filing requirement is 3 business days. Most of the ones I watch appear on the Edgar system in 1 or 2 days.
by cato
Thu Nov 20, 2008 12:05 am
Forum: Personal Investments
Topic: TIPs mathematics
Replies: 2
Views: 1285

Holy smokes. You just dropped 200 grand and didn't bother to calculate this beforehand? I've got some great CDOs to sell. You interested? ;-)
by cato
Sat Nov 15, 2008 10:55 pm
Forum: Investing - Theory, News & General
Topic: Why do foreign countries buy Treasury Bonds and not TIPS
Replies: 13
Views: 3363

I don't know about foreign countries, but the more I think about it, the more it seems to make sense to buy TIPS and short regular Treasuries. If you believe (as I do) that eventually, all this money printing and debt issuing will be very inflationary and cause Treasury yields to spike, it seems li...
by cato
Sat Nov 15, 2008 6:19 pm
Forum: Personal Investments
Topic: Larry, et al: Value in Municipals?
Replies: 31
Views: 7225

I forgot to add: I carefully examine all the holdings of the Muni bond funds. Beware of bonds whose ratings are trumped up by "insurance." Insurance from AMBAC, MBIA, et al, isn't worth squat, IMO. If the rating is based on that, you don't want it. As Larry mentioned, pre-refunded or u.s. ...
by cato
Sat Nov 15, 2008 6:10 pm
Forum: Personal Investments
Topic: Larry, et al: Value in Municipals?
Replies: 31
Views: 7225

I recently started buying California Muni CEFs. These use leverage and were badly bruised by the Auction Rate securities fiasco. The result is they now trade at 20%+ discounts to NAV and feature yields over 7%. That's for average AA-rated portfolios. I think TIPs and Munis are a great complement to ...
by cato
Sat Nov 15, 2008 3:46 pm
Forum: Personal Investments
Topic: Excellent information in Money Magazine
Replies: 5
Views: 1967

Re: Excellent information in Money Magazine

Money magazine is bullish and sees the end of the current debt crises as well as resumption of increasing stock prices. By way of example history shows that when the bear market turns bullish one third of your paper losses are recovered in 40 days or 80% within the next year. Everyone is expecting ...
by cato
Fri Nov 14, 2008 11:25 pm
Forum: Personal Investments
Topic: I bought my first individual TIPS yesterday
Replies: 58
Views: 11439

AFAIK, Fidelity values your holdings based on the Bid at the last close. So, you're normally seeing yesterday's price. It's pretty unlikely that you actually bought at the Bid price, so if you buy near the close, you're probably going to see a loss the next day. Also, don't forget that the value sho...
by cato
Fri Nov 14, 2008 3:49 pm
Forum: Personal Investments
Topic: Comparing Schwab to Fidelity TIPs pricing
Replies: 1
Views: 1159

Comparing Schwab to Fidelity TIPs pricing

I have both Schwab and Fidelity accounts. I've been comparing TIPs prices from the two over the last week or so. It looks like Fidelity wins out pretty consistently. Here are the current prices for a few. 1/15/15 1.625% Schwab: 89.81 Fidelity: 89.054/89.770 1/15/16 2% Schwab: 89.97 Fidelity: 89.257/...