You Can Never Go Back Home       March 30, 2007

Recent data seems to refute this old adage. After spending 5 or 6 years in college, many newly minted, diploma holding graduates are returning home. “Failure to Launch” was a reflection of a growing phenomenon around the country. For me however, the sight of Terry Bradshaw’s butt, has made that both a memorable and disturbing film. But the reality is that you can go back home. It’s cozy, it’s safe and it’s cheap. And everyone is doing it.

But in the world of business it’s not quite so clear that you can go back home. Steve Jobs and Charles Schwab did, and their company’s shareholders were elated to welcome them back. Apple Computer may just have well been named Jobs Computer, because there was only a rotten Apple during his absence. Even the threat of his departure, whether due to personal health or options related scandal, had depressed the stock price, and his returns to grace and health saw upward moves in Apple’s price.

In Charles Schwab’s case, the company was already called Charles Schwab. No need for renaming. But when he left, it lost focus. When he came back, Schwab, the company came back, better than ever. Among the discounters it is still able to command a premium for its services.

So they could go home. And everyone lived happily after after, that is, until they leave again. And someday Steve Jobs and Charles Schwab will pack up and go. Planned succession? Who could fill their shoes? John Scully?

But it’s not always that way. Remember Gateway Computer? It’s still around. It’s a $2 stock that every now and then gets speculative play because people think that it will return to its former glory. And why not? A couple of years ago it’s iconoclastic founder, the pony-tailed Ted Waites returned, to help rescue the company, that littered the landscape with its ubiquitous cow boxes in the mid-90’s. Gateway once had cachet, now it has some shelf space at Best Buy.

Well, you know what happened. I already told you it was a $2 stock. Buying out low quality maker eMachines didn’t do much for Gateway. Bringing the cow boxes out of pasture didn’t help much either. And so Ted Waites left again. He couldn’t go home. He never did learn to avoid the pastures while in sandals. That was his real downfall.

Why bring this up? Who really cares about Gateway? Although I still have my first PC, a Gateway P70, with a kicking 1 Gig hard drive, I really don’t think about Gateway. In fact, the only reason I still have the unit is that it is too heavy to take to the dump. There is nothing compelling about their machines, other than to bring back memories of the early post-IBM days when Gateway and Dell slugged it out for the hearts of the computer newbies.

But I do care about Dell. A few days ago I wrote that I was planning to make a sale of my Dell stock if it reached 25, which I was expecting, since the bad news was certainly behind us.

In my own mind, I may think that I’m pretty important, but I’m pretty sure that my disclosing my intentions didn’t send panic waves through the market for Dell stock. Oh, as it turned out, it was more bad news.

A couple of months ago, the famous founder, Michael Dell himself, stepped back up to the plate. Out was his hand picked CEO successor, whom he had wholeheartedly endorsed just weeks before. That’s always the kiss of death. The stock rallied on that news. The prodigal father was returning to rescue his child. Dell would go up, would go down, would show some brief upside trends on news. But Michael was back. He came back.

Now it’s never good news when you start the morning with an announcement that trading in Dell stock is halted. That was this morning’s news. It followed yesterday’s announcement that there may be a need to restate prior year’s’ earnings. Irregularities. How I hate that word, at least if it refers to a stock that I own. At my age, it’s very important to be regular.

Dell is a good example of how not to buy a stock. A while ago, after quarter after quarter of great earnings and guidance, Dell announced a disappointing quarter. The stock fell about 10% on that news. I though that was a great opportunity to buy into a great company, at a great price. Not !!!!

Who knew that the house of cards was beginning to crumble. Those disappointing results may have been the first indication that you can’t hide irregularities forever. Manipulate as much as you want, but sooner or later the truth comes out. And so for the past 18 months or so, its been one delayed filing after another. That’s never good news. Yet Michael Dell stood by his man. After all, they did share an office.

In hindsight, with the continued delays, and the continued support of Michael Dell, there should have been alarms going off for me. But I kept confident. Secure in the fact that even while no longer running the company, Michael Dell would get this thing back on track.

He didn’t and he hasn’t. It’s hard too imagine that he didn’t know the depths of the problems at Dell. They still make a great product, albeit not price competitive, but a great product. In a household full of computers and laptops, our Dell is our top dog. But as a company, it’s broken, and Michael Dell should never have gone back home. Only time will tell what whether there was criminal activity or securities violations and now Michael Dell is back. If he knew the depths of the problems, his arrogance is mind boggling. The market wants results, not camouflage and not a soft shoe shuffle.

Maybe more disturbing is that if he didn’t know what was going on, what is he doing coming back? Stay away. How could he have been so removed? That’s very different from the departure of Jobs from Apple. If he was so removed and distanced from operations at Dell, how in the world could he be prepared to rescue them from this morass?

I hate selling on bad news. That’s why I didn’t panic last month. The difference is that ultimately, with a broad enough time frame, the market always recovers. Remember 1929?

You can’t say the same for companies. Remember Enron? Maybe Dell makes up a few cents, but it’s hard to see a return to its glory days. There’s lots of competition. Computers are commodities and are priced as such. Dell products are no bargains and you have to wait a few days to get yours. Americans want instant gratification, not a visit from the UPS guy.

Oh, and the SEC problems don’t help, either.

I have two solutions. Think private equity, if you can’t comply with the SEC.

So, Michael. Come. Visit. Have a nosh. But seriously, what were you thinking?

And my other solution?

It’s time to go, before you end up on Best Buy’s shelves next to your old friend, Ted.

de Tocqueville Talks the Truth  March 29, 2007

Alexis de Toqueville was so right. America was an incredible place of opportunity. But what about now?

As a budding internet entrepeneur, Szelhamos would be proud if I used this opportunity to promote another enterprise. Shameless promotion is part and parcel of what de Tocqueville would have admired in the 21^st century.

Shop and Roll is an under construction web site that is planned as a one stop internet shopping spot for college students who are too busy studying to go out and buy their essentials. And when I say “studying”, I mean “drinking”. And when I say “essentials”, I mean “whatever”.

So as I am busily working away at signing up to become an affiliate of so many hip and happening web stores, what do I find? Even in its nascent, unpublicized and pre-operational state, somehow people have found the site, clicked on its icons that direct them to their favorite shopping and/or social sites and have, thereby, deposited referral funds into the Szelhamos coffers.

Now this is a good thing, because of the commitment to donate a majority of the gross revenues to the US Holocaust Museum, but it is pretty unexpected. Welcome, but unexpected.

Now I don’t have any wild dreams of becoming an internet star, profiled simultaneously on Time, Newsweek and parodied on Mad Magazine, but this is incredible. Anybody can do this, and what’s more, everyone is doing it. What this means is an expansion of the new economy. The dot com bust was necessary. It whet everyone’s appetite for a future of intellectually based economies.

Granted, I started a small ad campaign on Google, and have seen their report that ad placement for www.shopandroll.com had already appeared about 4,000 times in about a day. That’s pretty incredible. It even appeared on a New York Times web page. Wow. I don’t think I could ever get my own obituary into the Times. This is big.

Imagine, making money by having other people do what they would normally be doing. Clicking away and shopping. But it gets even better. Let someone click on your Google search placement and you get paid for their search. Is this America, or what?

Last week, my son was talking about getting a summer job. He said he wanted something that paid a lot and didn’t require much work. Have I got the thing for him.

But the real question must be: WWdTD?

Yes, that’s right. What would de Toqueville do?

What would de Toqueville think about the new America?

I was listening to some discussion today that seemed to suggest that we were in dire need of business leadership. People who would run companies to build them up, and create plans for leadership succession, while not plundering the assets.

The usual list of rogue CEO’s was rolled out. It read like a Hall of Fame roster. Nardelli, Lay, Ebbers, Kozlowski and McGuire. How Nardelli got lumped together with felons and posthumously pardoned felons, escapes me, but he was. The guy was on a roll. Who was going to stop him? Not the moderator.

I suppose that de Toqueville would also disagree with the inclusion of Nardelli. He would not have admired the autocratic, if not aristocratic manner. I think that de Toqueville would have admired and embraced the others, though. Think of the ingenuity it took to capitalize on the vast opportunities at Enron, Tyco, UnitedHealth Care and WorldCom. Nardelli never was that ingenious. All he did was get a great pay package, while not doing anything that tangibly benefited Home Depot. That was the real difference between two of Ken Langone’s peeps. Dick Grasso at least gave you your money’s worth. He made it easy for John Thane to capitalize on the lust for the stock of exchanges.

I know that de Toqueville would have said “carpe diem”, or maybe not, but I just assumed that he was fluent in “sound bite” Latin. All of what these rogue CEO’s have done would have fit in perfectly with the 21^st century de Toqueville vision of America. An America where ingenuity rules and where there are no rules to bind the limits of our dreams. He would have thought that all of the controls and harnesses were so “old European” and could only serve to stifle great minds and ambitions.

Look at the burgeoning world of derivatives and ETF’s. Incredible ingenuity and it keeps getting better and better. But that’s the kiss of death these days. Look around, because they may not be around that much longer. Now that you can buy ETF’s that offer the opportunity to double the movement of your favorite index, you even get to pick the direction, it’s only a matter of time. A matter of time until stiff controls pop up as the derivatives will be blamed for the next market hiccough.

Sub-prime move over. There will always be a new whipping boy.

So, the more I think about it, I think I should urge my son to be a CEO. Not a Nardelli CEO, but one of the other guy CEO’s. Who needs drone leadership. What we need is more conniving, more pushing the limits and more over the top opulence. I guess the next thing would be gladiator fights, but I don’t see that happening before the 2008 elections.

So WWdTD? I think de Toqueville would head back home.

Alphabet Soup   March 28, 2007

Yesterday it was Citigroup (C - NYSE), with 10,000 jobs cut. Today, it’s Circuit City (CC - NYSE) announcing a cut of 3,400 jobs. Is there a trend here? What’s next? It has to be Calgon-Carbon (CCC – NYSE). Now I understand how these forecasts are made. There is no CCCC, so I suppose that soon we’ll be hearing from Dominion Resources (D - NYSE), Dupont (DD – NYSE) and Scour Pharma (DDD – NYSE). How Scour Pharma got to be DDD, I’ll never know. But I think you see the pattern. I’m certain that two days worth of data is enough to extrapolate with.

The really big news this morning, though, was not the monthly durable goods number, to which there was an early over-reaction. Nor was it the combined FBI, IRS and US Attorney’s investigation of Beazer Homes (how’s that for alphabet soup?). It wasn’t even the spike in oil prices. No, it was the surrender made by the New York Stock Exchange. Amazingly, no one else picked up on this.

You know that I love NYSE’s stock, though. NYX is up another $3.20 in the early trading, and climbing, despite a 60 point morning drop in the Dow. No, it is the sad realization that Microsoft will never be joining the Big Board. For today, the ticker symbol “M”, long thought to be reserved for Microsoft was ceded to Federated Department Stores, or as it wants to be known, Macy’s.

I own Microsoft, but I wish it would spin off its entertainment division. I haven’t heard anyone else talk about this. In a bohemoth like Microsoft, it takes an 8.0 Richter to even make a blip. There’s a lot of value and growth potential in their X-Box franchise and the big investments in infrastructure have already been made. It’s time to cash in. But I know, just like the move to the NYSE, this will never happen. So Microsoft will plod along, occasionally handing out a bone of a special dividend, and continue to cannabalize the intellectual advances going on in those more nimble companies. Buying the ValueClicks of the world is now their idea of innovation.

For Microsoft, it’s a good thing that there was no Microsoft-like company in the early ‘80’s. Actually, there was. It was IBM, but IBM nurtured and innovated from within, which is why it had been able to completely re-invent itself. Assuredly, Bill Gates and Paul Allen would have, otherwise, been bought out and eventually banished from their former company. The upside to that would have been that Gates and Allen would have gone on to innovate elsewhere. In the current Microsoft model, the acquired company executives stay on and become corporate drones, treading very gently, leaving the quantum leaps to others. Think Ray Ozzie and lost opportunities.

I’m sure that if the NYSE had its choice, it would gladly trade Macy’s, by any name, for Microsoft. There’s no comparison in their trading volumes, and it’s the volume that counts. NYSE is not a boutique shop anymore, it is a wholesaler and needs product.

By the way, I did just sell the NYX April $105 calls. It will do well, with or without Microsoft. Here’s hoping it closes below $105 on April 20^th. That is the perverse world of selling options. You want sideways action and the chance to live to see another day, and maybe sell another option. If NYX gets exercised at $105, the premiums that I’ve collected since late December will represent a $5 per share bonus, or more than 5% additional profit. That annualizes out to 15%. That offers a nice cushion, if the underlying stock falters.

By the same token, I was happy to see Apple drop a couple of dollars today. I have options written for April and May, at $95 and $100 strike prices an, so right now, it is below both of those levels. Good for me, up to a point, as long as it doesn’t go much below $95.

Apple has been great at this kind of sideways movement. But it’s the timing of its moves that I really admire. It always seems to close right below the strike price on expiration Friday. Sooner or later, you do have to take profits, but it’s fun trying to see how far you can push things, before you get burned. And I have been burned.

The other long rumored reserved symbol is “I”, supposedly for Intel. Based on Intel’s performance the last couple of years, it doesn’t belong in anyone’s marketplace, but oh, the volume. The volume. Intel was one of those stocks that I bought for my kids. I learned my lesson with that one. It’s not a kids stock. Too stodgy. Although I wouldn’t mind stodgy, if it went up and up.

Once again, the broad market was not very good today, although the after hours market showed some good bounce.

In an otherwise down day I continued to find solace in Altria’s when issued stock, and of course, NYX. I did gloat a bit more today, as UNH continued to drop, as it tried to reach its 2 stadard deviation Bollinger Band, unsuccessfully, I might add. But I will probably buy back the UNH, because I am planning some sales next week, and since the money burns a hole in my pocket, I must buy. Sales? Yes. Dell, Electronic Arts and Tim Horton’s, if they go to 24, 52 and 31, respectively.

And, oh yes. Did you see Annaly today. It’s gone to its 52 week high, the day before it goes ex-dividend. It was up another 2% today. I expect it will approach $15.53 and then it’s time to sell, after pocketing the dividend.

Oh, and before I forget, Ben Bernanke spoke today. He expressed some concern about the potential for trickle down into the economy from the sub-prime meltdown. And so the market responded. Actually, the market didn’t even wait for the actual words. Once the prepared statement embargo was lifted at 10:00, it fell and additional 50 points. But I can only imagine how the market would have reacted if Greenspan uttered some similar, but indecipherable words.

I have no doubt that it would have plummeted. At least when Bernanke speaks negative sentiments, he has a way of soothing the beast. Even if Bernanke would say, “the economy is in the crapper”, I would be more uplifting than if Greenspan made some comment about exuberant froth.

One good way of soothing one’s self is with a bowl of nice, froth free, hot soup. I used to love Campbell’s Alphabet Soup, until I started reading the labels and until Campbell’s didn’t go up for me, as I thought it would a couple of weeks ago. So now, I’ll just soothe myself with some nice rice cakes. When it comes to alphabet soup, I think I’d rather endure a joint FBI and IRS assault than another broken company and its stock.

Sorry Campbell’s. Your soup’s no good. It’s time for a smoke.

Turn the Lights Off  March 27, 2007

What do India, Buffalo, Cincinnati and northern New Jersey have in common? Here’s a hint. They are the antithesis of London, Hong Kong and New York.

Citibank, or as it is now known, CitiGroup, announced that it is laying off 10,000 people and re-assigning another 14,000 +.

Do you remember the old Citibank slogan? “The Citi never sleeps? Apparently, the slogan was true. But there was a steep price to be paid. Why didn’t Citi ever sleep? Because it always kept its lights on in such high electricity cost sites as London, Hong Kong and New York. With the worldwide cost of energy soaring, it was only a matter of time until the venerable Citi put on a sweater, turned the thermostat down, lights off and fired 10,000 employees.

The much beleagured Citigroup Chairman, Charles Prince, has decided that the Citi must sleep. So he has ordered that the lights be turned out, at least in those costly cities. And 10,000 people will now be able to get some rest.

As for those other 14,000 that are going to be relocated, they won’t be sleeping. Scientific evidence seems to indicate that the lack of sleep in low cost of living areas has no detrimental effect on health. And like any good employer in a capitalist society, Citi wants what’s best for its employees. So now, they won’t be sleeping in affordable sections of India, Buffalo, Cincinnati and northern New Jersey. Did you ever think that the latter three would ever be in the same league as a third world nation?

So say “hello” to India, Buffalo, Cincinnati and northern New Jersey. If you’ve ever been to Hong Kong, you’ll be amazed at how similar it is to Buffalo. That should be an easy relocation. I feel badly, though, for those Hong Kong people being relocated to Cincinnati. Talk about culture shock. Do you know how hard it will be to get good fresh pickled eel? They may have to cross over into Kentucky.

But I know what you’re asking. How does this news effect me? Pretty straightforward. Your life as a customer in need of assistance, will be miserable. If you think the accent of your customer service rep in India was tough to handle, just wait until you hear the northern Jersey accents. You’ll be pining for the old days.

Over the years I’ve been looking for good reasons to buy some Citi. Until today, I hadn’t found any. As Citi kept getting bigger and bigger, it seemed to lose its way. Jim Cramer is very blunt about Citi. He thinks the only way for the stock to appreciate is for Prince to go, The chorus is getting louder.

So today comes the big announcement. Even in today’s down market, the news would have ordinarily been met with enthusiasm. As it turned out, Citi under-performed today’s market. What will Prince need to do next to keep his head off the chopping block? He’s obviously going to strategize like it’s 1999. But whatever else, it’s probably too late. So as it turned out, I still haven’t found a compelling reason to make the purchase. But it’s coming sooner, rather than later.

So Citi didn’t help things today, but at least it’s not involved with sub-prime, at least not as far as we know. But in just a second degree of separation, the market wasn’t very good today, with homebuilders, yet again, dragging everyone down. Put this into short term context, though. Yesterday, after all, was actually a great day. After 5 straight up days, we were poised to slide. Down over 100 points, the rebound returned us to a loss of just 11 points. How great was that?

So today, with no real news, just more dwelling on the housing numbers, the market didn’t do much of anything. No conviction or just a case of taking a breather. I doubt the latter. Traders are just waiting for the slightest positive hints to take us to the next level. But they are nervous.

On a personal note, despite the qualms about trading UNH for Altria, on day one it’s looking like a really good move, especially with UNH down $1.20 from where I sold it and the Altria (when issued) up $0.42 from its purchase price. I’m glad that when I get my life insurance premium quotes they don’t ask me whether I’m a smoker, by proxy.

And did you see NYSE today? It continues on its climb back toward its high. I’ve been holding off selling call options, because I felt that it’s stock price was too low and the stock would still be heading up. In the after hours, thanks to some very positive comments by Jim Cramer, NYSE doubled its regular trading gain, closing in on $96. Once it gets to 100, it will be time to sell April $105 or more likely, May $110 call options.

While the market continues to look poised to move up once it completely digests this sub-prime stuff, I am actually wondering what Citi’s move portends in the long term.

In the past few years, the economy has been adding jobs. We’re a little removed from some of the misery a few years ago when it seemed that each week a new and ever larger layoff was announced. We were getting used to companies announcing one huge layoff after another. It’s hard to know whether the relative calm of the past few years has been because companies are now lean and mean, or because business has been good.

The consistently increasing monthly productivity numbers might seem to indicate that both are true. Perhaps there was a causal relationship. But its been calm lately, that is, until today. No numbers were given on the proportion of Citi layoffs in the United States. You would think that with the past outcry over outsourcing, if jobs were being relocated to the US, CitiGroup would trumpet that fact. So who knows?

It’s time to turn the light back on CitiGroup to help clarify what their announcement really means for all of us. Or as is said when the lights go off for the night, “Good night sweet Prince, good night”.

Smell Bad – Make Money  March 26, 2007

Pretty amazing. Early in the going this morning, the market was down about 12 points. I was closely watching UnitedHealth Care and Dell, and was ready to trade out of both, apparently none the worse for my UNH greediness on Friday, since UNH was now above where I had initially intended to sell.

At the time, the market was on an uptick, so I took a little breather. Straying away is not good. I don’t know how day traders do it. Actually, I do know. They don’t do it very well and it is incredibly stressful. Or so I think. Maybe they wear those astronaut diapers.

And so, about 20 minutes later I returned, only to find an additional 95 point drop. What happened? Where did this stink come from? I certainly smelled better thanks to a wonderful Proctor and Gamble product that is not allowed in carry-on bags, as per TSA directives. Personally, I think that if an individual fits the terrorist profile, if they are found in possession of any anti-deoderant, gel or otherwise, the working hypothesis must be that it is to be used for evil purposes and not for odor control.

Now the blame was being put on bad housing numbers. How is anyone surprised? That’s all that’s been in the news lately. High home inventories, sub-prime debacle, falling home prices. Once again, where is the news here? Of course, just a couple of days ago all of the homebuilders were up big. Does any of this make sense?

Not to me.

What does make sense is that, at best, this is a zero sum game. Never mind up and down volume statistics, never mind the direction of the indices at any moment in time. Someone either wins or loses. And even winners may be losers. All it takes is defining your terms. A winner can feel like a loser if he sells too early and could have gotten a higher price. That is also called “greed”. I think it’s one of those deadly sins.

But, I suppose that losers can consider themselves winners if they got out of a stock just in time, before it really tipped down. I don’t think “whew” is a deadly sin.

So the housing market is in the dumper. How exactly does that cause a $9 turnaround in Google? Google is constructing an empire, but not made of framing timber and drywall. There must be a connection somewhere, although I think I can find a connection to Kevin Bacon much faster than to homebuilding.

As far as Google goes, it turns out that some analyst has questioned their first quarter numbers. No one gets Google yet. It’s got an amazing network that continually is monetized, as more and more people enter into the cyber-world marketplace. I’m living proof. I pay Google. Szelhamos Rules has been posted more than 30,000 times in 1 week. Incredible !!!!!!! I don’t know if that moves anyone to action, but you can’t say that they didn’t have the opportunity.

Everyone on Wall Street was upset with the upstarts at Google, since they chose not to give guidance. As with most everything else Google does, they’re ahead of the curve. What does Blackstone announce on Friday? This mega-billion private equity company is going private. And guess what? They’re not going to give guidance. Did anyone hear the outrage? No. Only the clamor to get in on what is perceived to be a good thing.

The brokerage houses made a sudden downturn, as well. At least I can understand that. Maybe.

Anecdotal evidence alternates between being worthless and prescient. But yesterday, when my younger son and I went cruising, in preparation for his road test, I had a rare opportunity to be a passenger. All I saw was endless evidence of home building. Each development bigger than the next. I’ve even started seeing the unheard of “4 car garage” popping up. And the Washington, DC area is supposed to be one of those bubble areas.

It seems that the surprise was a big error in projecting the number of new home sales by 15%. They must have involuntarily retired weathermen making those projections.

So why should Blackstone, Google and what will certainly be a growing list of other companies give guidance? How good are “projectionists”? Based on today’s housing numbers you know the answer to that. I’ve railed against “futurists” before. It just gets re-inforced each day. I still like my derivative play on futurists. Futures on futurist projections. Go short. Or am I repeating myself?

So the day wears on, and what happens. My greed is rewarded. Nothing better than re-inforcing bad behavior. In what can only be described as irony, I traded out of UNH, a healthcare company, for the Altria when issued shares. Don’t know Altria? Think Phillip Morris. Don’t know them? Think Marlboro Man. You remember him. He’s the guy with the artificial voicebox.

Ironic. No? Plus, chronic use of their product will also leave you with an odor. Once again, the same old dilemma, with apologies to James J. Cramer. Smell Bad – Make Money.

At the close, Google has recouped everything. The Dow ended up right where I left it when cleanliness called.And once again, Apple and NYSE were really strong. Remember those deep in the money NYSE options? Too late, now.

I think that the ultimate lesson to be learned is “don’t exercise personal hygiene” when there’s a trade to be made. Any news can take us in any direction. But more importantly, I now believe that personal hygiene belongs in the deadly sins category. I’m certain that the person who will be sitting next to me on my flight this evening would rather that I missed a trade or two. But they probably don’t really understand what’s at risk. The same goes for a good smelling terrorist in the seat next to you.

To truly see the big picture you have to suspend some of your senses. Perhaps olfactory should be the first to go.

Is Enough Ever Enough?  March 23, 2007

Philosophical questions can never be answered to anyone’s satisfaction, unless there is willingness to close all open-minded thought. Increasingly, I’m approaching that goal. Thought is a hardship.

A colleague of mine recently posed this question and I’ve been thinking about it all week. Mostly, it bought me back to Mr. Mohan’s eighth grade class. Mr. Mohan was a pretty good guy. I remember how we spent one class talking about the same day deaths of Frankie Lymon and Che Guevera. Most of us knew who Frankie Lymon was. I don’t think Che Guevera was on any of the charts back then. Somehow, he was able to bring the two lost souls together.

But occasionally, Mr. Mohan stuck to the curriculum. And so we read Tolstoy’s short story, “How Much Land does a Man Need?’

Perhaps it’s because it’s the only short story that I can remember, but it was always my favorite. I suppose there was also “Bartelby the Scrivener”, but I can’t really use that as a metaphor for much of anything, right now.

But the story of Pahom is certainly relevant. You’ll have to read Tolstoy’s tale yourself to understand the temptations that pushed Pahom. A little known corner of human nature, greed, was at the core of Pahom’s demise. Offered as much land for free as he could cover by foot in 24 hours, Pahom keeps going, always wanting more and more. And why not? It was free and he had nothing better to do with his time on that day. And I can relate. That;s the very same reason that I’m willing to do 25 minute internet based surveys, just to get more e-points. And I don’t even know what e-points are.

To really make a short story even shorter, Pahom drops dead and gets nothing, except for the only land he really needed. That turned out to be his 6 foot long grave. I’m not certain how many e-points it takes for a traditional burial. Toltstoy didn’t go there.

Pretty gruesome, but memorable. I’m sure that there’s a moral there somewhere, but it’s escaping me at the moment.

So as I try to figure out Tolstoy’s subtle message, I may end up regretting an attempt to wring 3 extra cents out of a sale of UnitedHealth Care stock. I mentioned UNH the other day, and it was a big mover today. I decided that it was time to sell, but I set my price too high. The sale never happened.

Over the past couple of years, every time UNH approached its Upper 2 Standard Deviation Bollinger Band, it retreated. It was there today, I should have made the sale, but for the want of 3 cents, it didn’t happen. I think UNH will now follow the same path as Annaly did today, also having touched it’s Bollinger ceiling. It fell. It always does at that level. And I didn’t sell that one either, but that was because it goes ex-dividend in a week, and there may be a good opportunity to sell $15 May calls, if the price stays near $15. Just thinking of squeezing a few more percent out of Annaly, that’s all.

But so too will UNH fall, and it has no real dividend to speak of, and its options premiums stink.

There’s a reason that the investing axiom about bulls, bears and pigs exists. I’m usually not like that, but I thought the price would continue going up late this afternoon. I thought that it would be a good idea to make some sales this weekend, because I felt a little queasy about oil prices over the weekend, thanks to the way Iran celebrated its national holiday today.

Nothing to panic about, but I thought today would be a good day to take some profits. But I took none.

As it turned out, the market was up for the fifth consecutive day. It was the kind of day that I really liked. We were up only 0.16%. Yesterday, we were up only about 0.11%. That’s the way to do it, especially on the heels of some triple digit gains this week. There was plenty of time for people to recoup their losses and sell. But it didn’t happen. There’s a real positive trend, but it’s very unexciting at the surface level. Much like Al Gore’s congressional presentation.

Those numbers don’t seem like much, but could you imagine if we could average those kind of “miniscule” returns day in and day out? 0.10% per day is about 25% per year. I don’t even need that much. I’m no Pahom, although what I could have done with those 3 cents. Oh well, better not to think about it. Maybe a bronze casket. Maybe an upgrade to 7 feet.

I do my investment projections with a hope of 7% annual appreciation, after expenses. That’s enough to double existing assets every 10 years. Published statistics indicate that most people’s retirement funds earn only about 2% per year. The difference? 36 years to double assets versus 10 years. I’ll take “Doubling your Money in 10 years”, Alex.

But why does it have to be so hard?

Because it’s made that way.

It seems sort of perverse, that if I were to park money in my E*trade IRA, in-between investments, I would only earn 0.3% interest. But if I parked money from my regular taxable trading accounts into a money market fund, I would get 5.05%, regardless of the balance. There’s a real incentive to invest those funds, since most people would rather lose money than get only 0.3% interest. Besides, people don’t get excited about savings returns.

The answer to the working question is that even 5.05% isn’t enough to get me where I want to go, unless I don’t mind tacking on an additional 4 years to double my assets. But 0.3% is, well, let’s put it this way, even the yogurt drinking denizens of Tolstoy’s homeland, don’t have that kind of life expectancy. 240 years.

Is enough ever enough? I don’t know. I don’t have that problem, yet. And I’m not as philosophical as I used to be. There was a time, a long time ago, when I used to put dollar amounts into the proper perspective. That perspective was based on how many 25 inch color televisions that money could buy. Back then, 25 inch color TV’s were expensive. I remember when Szelhamos was once offered a job that would have paid him enough, before taxes, to by a new 25 inch TV every week.

To my way of thinking, at least back then, a new TV every week was enough. Never mind that there would be nothing left over for discretionary items, such as food and shelter. I didn’t know anything about taxes, health insurance or even grocery bills. But I knew TV’s.

One TV every week was enough. Now, I’m not so sure.

Goonies Against Google  March 22, 2007

The world has had its share of evil partnerships. Every generation probably contributes its own personal demons to that inglorious list.

Today, a new partnership of evil was announced. They will probably end up going by the acronym, GAG, because Goonies Against Google is just too awkward. And the acronym is appropriate, because that’s exactly what they seek to do to Google.

Who are these modern day gaggers of freedom? The unlikely and unholy partnership of NBC-Universal and News Corp. They announced their new joint venture which is squarely aimed at Google’s YouTube. I certainly can see the evil in Jeff Zucker. Sure, he would be behind this in a heartbeat. But, how could Rupert Murdoch do anything so un-American and un-naturalized?

Their announcement today brings the concept of freely available copyrighted video content on demand closer to reality. I truly understand the need to protect intellectual property. Where I have the philosophical split is that the use of the public airwaves to bring content into our home transfers the ownership of that material. Let’s face it. Broadcast television doesn’t use the airwaves to entertain us. They use the airwaves to sell things to us. They hook us in by presenting visual entertainment. The price they should pay for invading our privacy with adult diaper ads is to cede ownership of the vapid material that is attached to the ads.

The evil axis believes that they can move traffic from YouTube to their new site, which of course, will be monetized with intrusively placed ads. Of course, they will also have to follow through on lawsuit threats against Google, and will attempt to force Google out of their billion plus dollar purchase of YouTube, a sort of buyer’s remorse.

What they don’t get is that YouTube is far more than a venue to post clips form television shows or movies. It is the single greatest expression of creativity and universality since creation. It is open to everyone.

So now what?

As Steve Case and Gerald Levin intoned, “he who controls content, controls the world”. Well, maybe that wasn’t the exact quote, but that’s what they believed. And, they had us believing it, also. Who better to control content and spread it to the masses than AOL Time-Warner?

The first part of the answer to that question is “not AOL Time-Warner.

Because a funny thing happened to that unholy alliance. Had Case and Levin been students of history they would have known what fate waited to befall them. Evil partnerships never last. The Third Reich? How about Hitler and Stalin? Evil is evil. There’s no glory in sharing the spotlight. What evil partnerships do well is to implode and then collapse. Remember The UAR? How did that Egypt – Syria work out? Some of the lesser evil partnerships aren’t well remembered, but their fates are always the same.

Time-Warner folk and AOL people just didn’t play well together. They each wanted control. The wonderful synergies couldn’t overcome the petty jealousies and the “I’m better at evil than you are” mentality. It’s pretty sad when it takes a Carl Icahn to break up an axis of evil. But what better to fight evil with? By the way, have you noticed the action in the past couple of days in a couple of Icahn’s pet projects, Motorola and Blockbuster?

So why do NBC and News Corp ignore the lessons of the past? Because they are evil. Maybe not in a pure sense, but they are evil in going about their plan to destroy the bastion of modern day freedom. That bastion is Google.

Has any entity done more to bring equality to the masses? Information will set you free, said someone of historical note. Who provides that information more freely and with the greatest ease of access in the history of the world? That’s a no brainer if there ever was one.

But have you noticed that everyone wants to put a gag on Google? There’s fear of opening up the world’s repository of knowledge to the masses. Belgium, of all places, has filed suit against Google. When did Belgium decide to no longer value freedom? Perhaps they long for the days of yore. Maybe information dissemination was better when it was in the hands of a single man. At least Mussolini’s German partner in evil believed that.

When Google announces grand plans to put the world’s literature onto the internet, there is an uproar. Probably by the same groups that advocate book burnings.

Well, what axis of evil would be complete without its Mussolini, Franco or Tojo, to bring the metaphor back to the world of Szelhamos?

Fortunately, we don’t have to look far. Viacom is at the ready. There will certainly be more ready to step up to the plate.

They slapped Google last week to eliminate all of its Comedy Central material from YouTube. I’ve said it before, and all of these evil doers know this to be true. YouTube is the single greatest advertisement for their wares. If you liked what you saw on YouTube, you’ll check out the original material. Oh, and was it mentioned that it was free advertising?

Google can easily afford to walk away from YouTube. What’s a billion to Larry and Sergei? But they believe in their concept of distributing knowledge. To them, it’s worth the paltry sum.

As an investor with shares of Google, I’d like to see them walk away. But I quickly realize that it would just be wrong. Google is the revolution. The others are “The Man”. NBC Universal and News Corp are not going to take us forward. Google has and will.

So how did Google perform today, with yet another onslaught? Go figure. It was up $5.49, about 1.2%. I haven’t made much on my Google shares, but I still love the stock, probably because of it’s volatility. It’s options have been great to me, resulting in a 2.5% yield in 2006. If Google moves up again tomorrow, I will probably look to sell some May $520 call options.

Speaking of which, did you see the action in UNH and Annaly today? Annaly moved down from it’s high’s, but broke it’s 52 week level. It will go higher.

And the deep in the money June NYX? Smoking. How about 5% in Goldman?

Back to Google. I suppose it’s commonplace for corporations to be hated these days. But look at who’s doing the hating. It’s easy to understand some of the issues against Wal-Mart and Microsoft. Not necessarily agree, but understand. But Google? You gotta hate the haters.

Goonies Against Google will eventually cite creative differences or will devolve onto a bland and lifeless portal. Move over Pets.com sock puppet. There’s plenty of room up on top of the heap.

Meanwhile, Google will use it’s ingenuity to keep expanding our horizons and freedoms. If you haven’t really checked out all that’s available on Google.com, you really need to go.

Gag Google? They’ll try. Others will try, as well. Just stay away from the haters, whoever they are.

Hope Sprang Eternal       March 21, 2007

How appropriate, this being the first full day of Spring, and potentially the third of 3 up days. Although, here we are, at noon, and it’s not looking that way.

But hope is very different from blind faith. With blind faith a state of denial exists, where even the obvious is overlooked. With hope, we know that there’s a chance that things may not work out. I’m hoping for re-assuring words from the Fed this afternoon. My faith, however, tells me that despite the certainty of no change in rates, the markets will over-react, in one direction or another. I have faith in the certainty of irrational responses to predictable actions.

The professionals would called that “cynical”. What do they know?

Right now, it looks as if everything is on hold until the Fed’s statement later this afternoon. Why anyone expects a change in course is beyond me. While everyone else will be raptly listening, I will just enjoy the wonderment of how every hair in Ben Bernanke’s beard is perfectly groomed. I could never be a Fed chairman. Although, in hindsight, I wonder how Allen Greenspan got to that position. I’d love to know what he had on Reagan.

Meanwhile, every spinner in the world will be dissecting each and every word, or missing words, of today’s statement, for their imaginary significance. I’ll be trying to groom. Who knows. Bernanke can’t be chairman forever.

As we take in the spin, remember, as a great American once said, “it depends on the meaning of the word ‘is’”. How right he is.

If that’s what it really comes down to, we’re all in trouble. But have no doubt that people hear only what they want to hear and their spin reflects that. That is blind faith to one’s own narrow outlook. A dangerous path to walk.

So far, all I’ve heard are expectations of no change in the Fed rate. So why is today’s market so tentative? Everyone knows what the Fed will say. Maybe it will all be about what they don’t say. But no doubt, they will keep rates unchanged and make some comments regarding circumstances that might cause a change in rates. So there will be negative spin on the one hand and positive on the other. Put it all together and you have no net.

And then it happened.

The Fed spoke. Guess what? The market over-reacted, but in a direction that I found glorious. Why? The spin is not on what was said, but on what was omitted. Could you imagine telling your kids “don’t listen to what I say, listen to what I don’t say”. Nothing was said about a need to tighten if the economy heats up. All you had to do was read the empty spaces between the lines. It should have been obvious to everyone. What they didn’t say is what they meant.

But it’s official. With today’s 159 point gain, my portfolios have recouped all of their losses from February 27^th. But even better, the Dow still has nearly 300 points to go to get back to it’s recent high. My stocks have tended to do well in up markets and not quite as poorly in down markets. Those options writing efforts really do help to offset the down markets, and instead of panic selling, it was a good opportunity to rebalance and average down.

So, if we are at the tipping point, although granted, the reaction to the Fed announcement may have brought us to an artificially high third consecutive day, we’re going up or down fast. I tend not to get too excited about really big drops or gains. These are often singular phenomenon that have no lasting effect, although they make great headlines. Nobody wants to read “Dow up 2.73 Points. Long term Trend Noted”. Everyone wants “Dow Jumps 159 Points”.

Although I love seeing these 1.25% up days, I rather see every day up 0.05%. Day in, day out. That would work out to about 12.5% per year. Not bad. That would be much better than the gyrations. What gets my attention is the slow, but steady movements that either eat away at your base or expand it. Nothing fancy, nothing dramatic, just incremental changes that when added together can take your breath away. Sometimes when it’s too late.

But I have faith. Not blind, but we’re going up. You knew that I would say that. Sure, we’ll give up some of the gains from the past 3 days, almost 3%, and then start the upward climb. Slowly, I hope. And I think that’s the path we will take, because today’s gain, although it was the third in a row, was just an empty gesture following the Fed’s announcement., It doesn’t count.

We were muddling along at 15 points down, and then up 160. That’s not real. Let’s see what tomorrow brings. I’m not ready to tip.

Speaking of faith, one stock that I have had faith in, appears to be poised to reward me, after more than 18 months of frustration. Maybe the name change was the start of good things to come. The old Annaly Mortgage, now Annaly Capital is making a steady move back to it’s glory levels, after a long time in the dumps. Its saving grace has been its dividend. Even after a dividend decrease, it’s still at 5.2%. Unfortunately, Annaly, whatever its name, never offered a good options premium. If it had, I’d be bragging about its return, especially since I’ve held it long enough to have bought and sold 18 months worth of options.

I’m not a technician, but both Annaly and United Health Care are at their upper 2 standard deviation Bollinger bands. Neither has done well at those points in the past. Why should this be different? It shouldn’t, but I’ll be breaking another rule by ignoring lessons of the past. That’s a combination o hope and blind faith talking. At least with UNH, I have laurels to rest on, from previous bouts of ownership. But the most recent round has been marred by the options scandal. I hate scandals. Although I like scandals involving companies for which I don’t own stock.

So I sit here still hoping. Early retirement would be nice. A chance to pursue my long interest in Bollinger bands would be the inevitable outcome. But there is something appealing about continued ignorance.

At least hope springs.

What’s the Perfect Number?      March 20, 2007

Yesterday was a really good day.

I’ve been sitting around wondering just how many good days in a row it would take to turn things around, sort of a tipping point, you might say. If you’ve been paying attention, you might recall that I’ve touched on tipping points before (Szelhamos Blog Archives March 2, 2007).

Then I had the revelation. It was three. Three good days in a row would make everything just fine and return us into full blown bull mode.

I can’t take credit for this one, though. I really owe it all to my wife and her 5 year old friend. You see, about a week ago, we went out with a few friends and work acquaintances for dinner. It was one of those places that gives you crayons, which are perfectly suited to the paper tablecloth. Fortunately, it was also one of those places that gave you alcohol. Interestingly, you had to request the alcohol, but not the crayons. Our astute waitress, however, recognized that I needn’t be asked about the alcohol. She just asked me what kind I wanted. No niceties, such as, “may I get you a drink”. No, it was quite appropriate for her to ask if I wanted the highest alcohol content, regardless of taste. The answer was clearly going to be “yes”. She knew that, so why bother with niceties?

My wife and I were at nearly polar ends of the circular table, large enough for our party of eight. Also at polar ends were 2 young children, who between them totaled approximately 6 ½ years of age.

I got off luckily, although maybe it was the wine. My wife ended up playing tic-tac-toe with a five year old for more than an hour. But it was during that time that I realized that three was the perfect number.

It probably doesn’t rank up there with Pythagoras, but whoever first realized that a 3 x 3 square was the perfect tic-tac-toe vehicle, was a genius. Have you tried a 2 x 2 game? There is always a winner. The strategy is pretty simple. Go first. Follow that strategy, and you will win 100% of the time. How about a 4 x 4 or 5 x 5 game? No one ever wins, unless they are of very, very diminished capacity.

Three is the perfect number. It is the happy medium between always winning, or alternatively, always losing and neither winning nor losing.

So that is it. In a nutshell, we need 3 really good days strung together. I don’t know whether today and tomorrow will complete the troika, but it will happen soon. Who knows, with yesterday’s performance, and it was a good one, don’t let anyone belittle the day’s performance, we may make it to that tipping point. Which way will we tip? My guess is further upside, and why not. Maybe not in another straight line, but everything looks good again.

There’s talk of buying out sub-prime portfolios, merger and acquisition Monday was back and, as I thought, Goldman and some others were coming back to life.

You’re probably wondering how well my wife did at her tic-tac-toe efforts. You know, human nature is to typically allow a five year old to be victorious. But after the hundredth or so game, a little of that human kindness disappears. Truth be told, I’m not certain that she even allowed the child to win a single game. I think the kid won all of the games on her own merits. There may have been a tie or two.

But that’s the beauty of a 3 x 3. Anyone can win, on their merits and not on their starting position in the game. There’s an analogy that Szelhamos would have liked. In a free country, everybody gets to play the 3 x 3.

But in the market you don’t really have as much control as in the orderly world of tic-tac-toe. But there are still some good rules to follow, so you don’t end up being like the second player in a 2 x 2 game. Every now and then it’s nice to win.

I didn’t follow one of those rules. I suppose it’s alright to have blind faith in a person, especially a family member. You stick with them, in a hope that all good things will materialize. Why do we sometimes do it against all odds? Because we have real vested interest and dreams of a good life for the ones we care about.

So how does that explain my blind faith in Halliburton? Part of my “Evil Empire” portfolio, Halliburton has been a serial disappointer, but I haven’t pulled the trigger. I always thought the losses would be transient.

Halliburton makes up about 3% of my portfolio. With today’s 5% drop on disappointing earnings, I’m down nearly 15%. What rule did I break? Simple. You just can’t put blind faith into a company’s stock. Once you lose the objectivity, you just lose. It’s that simple.

The 15% loss is bad enough, but instead of taking my losses like a big boy and re-investing in something better, I just watched it fall. But Halliburton was cruel. It always looked like it was poised for a rally. No matter how hated the company is, it seemed to claw back, only to always hit a ceiling.

The fact that I maintain an “Evil Empire” portfolio at least shows that I can be objective and won’t let personal views get in the way of making money. Dick Cheney is ancient Halliburton history, but let’s blame him for the earnings report.

While we’re on the theme of 3’s and breaking rules, there are two other recent mistakes to own up to, but they all fall into the same category; blind faith. Face it, sometimes we’re just wrong. You know that I like to write covered options, with the intent of augmenting income. Sometimes, though, the covered calls will kill you if either your stock appreciates a lot or botttoms out.

But either of these scenarios, and I’ve had them both, can be easily averted, if you follow your rules. I’ve had a widely appreciating Apple and a depreciating Ameritrade, that I had refused to see the handwriting on the wall and didn’t do the right thing with my options. I blindly believed Apple would stop going up and that I would buy back my options with very little time premium remaining, and I believed Ameritrade would stop going down.

So how’d that work out for you? Thanks for asking, Dr. Phil. I could have made a lot more on Apple and lost a lot less on Ameritrade.

As it turned out, today was the second good day in a row. For me, it wasn’t as good as it should have been because of Halliburton’s announcement and the plunge in Blockbuster.

I have only owned a handful of sub-$10 stocks in my lifetime. Mostly, they have been dogs, that’s why I tend to stay away. But I’ve liked Blockbuster, that is, until today, when it’s CEO announced his premature departure.

What’s a nine letter word for “Extortion”? Let me give you a hint. It starts with a “C” and ends with “N”. Need another hint? Think Motorola and Time-Warner.

“Coercion” only has 8 letters, so that’s not it. I won’t tell you the answer, since I don’t want to be accused of libel. But the Blockbuster CEO was turning the company around and his latest initiatives have been very successful. Granted, this 9 letter person, oops, word, has brought lots of increased shareholder value to others over the years, so maybe this 5% drop in Blockbuster today is just a blip. Or it could be that tipping point thing again, right back to $3.50.

As far as making mistakes goes, 3 is also the perfect number. I don’t plan on making (or admitting) any more.

I Needed my Morning Fix     March 19, 2006

So here I was. This was my favorite time of the day, if there is such a thing for Monday mornings.

Everyone else was already out of the house. I had just poured my coffee, the dog was fed and had already received his insulin, the laundry was done and I had settled in to watch a little “Squawk Box” on CNBC. Heaven.

The morning started out as usual. I saw that the Dow Futures were up by about 50 points over fair value, so that was a little comforting. Joe Kernan was holding court. I truly believe that he should change his name to Joe Quernan, then the hosting trio would be Quernan, Quick and Quintinilla. That’s certainly better than the alternatives changes, such as Kwick and Kuintinilla. You figure it out.

Anyway, I turn around to put the milk away, and what do I hear, but the ramblings of Don Imus and the lovable Bo Dietl. I stare at the set. There’s the familiar stock crawl and overhead numbers, but it’s Imus in the studio that I see. He’s on CNBC. There’s no Imus on CNBC. I quickly, or kwickly, click the remote to MSNBC and it’s Imus, as expected, but without the ticker crawl. Back to CNBC, and it’s still Imus.

Now, there have been greater tragedies in the world. I like Imus, although I liked him much better 30 years ago, when he was really funny, in an adolescent kind of way. Back in the late 60’s or maybe early 70’s, he had one of the funniest comedy albums I’d ever heard. There was nothing funny about Kent State, except Imus’ National Guard fast food bit. He’s changed, I haven’t, end of story. But I wanted my QQQ gang. I needed my morning fix.

Nearly 15 minutes later normalcy returned. Some unexplained glitch, satellite, terrestrial, who knows? Maybe it was the aftermath of the Yen Carry Trade. The QQQ cast thought it was humorous. I was in sheer panic. But I’m Okay, now. My support group is back on the air.

I’m getting to need more and more fixes, these days. On Friday, witching Friday, I was glued to the computer for the last 30 minutes of trading, wondering what to do about LSI. I needed LSI to stay with me, but I knew that for my own sanity, LSI should go. I watched as its price remained stubbornly over the strike price. I was poised to let my shares go, pay a little exercise fee and get on with it.

But no. Why I had to go and check out the April $10 LSI premium, only the devil will know. But the allure was too great. I couldn’t control myself. With about 7 minutes of trading left, I was ready to make myself happy, just one or two more fixes before the close of trading. But just as it was all about to happen, the power went out. The computers went black, the TV died.

More panic. I needed my trades!!!! A quick prayer to a higher power, and power was returned, with still enough time, maybe, to boot up, log in, check prices, submit trades and watch for execution. Baby,it all happened. It was glorious. With seconds left, it all happened for me. I bought back my March $10 LSI options, settling for 1.5% additional profit cushion on my LSI purchase.

But it didn’t stop there. I sold the April $10 LSI options, at nearly a 5% premium to my original LSI cost. But lest you think that I have absolutely no control, I only sold options representing 80% of my shares. I plan to sell the remaining LSI shares, and start to make a clean break. Who knows, maybe by April 20^th, I’ll be LSI free. For how long? Only time will tell. Grant me the strength. What a thrill.

This morning, I’m ready to sell more Apple calls. The April Apple $90 closed on Friday at a bid of about $2.95, with Apple closing at 89.50. An additional 3% return after expenses, not bad for 5 weeks. But in the pre-open, Apple is showing up to $90.50, so I may wait to see what the Apple April $95 premium will be. It was $1.15 at Friday’s close. Life is complicated when you need your fix.

As it turns out, with the market up 117 points at noon, and Apple up to 91.40 on news that the Apple TV will be released soon, I decided to sell Apple $100 May contracts at $2.00. I think Apple will give up some of its gains in the next few days, and it may turn out that I will buy back those contracts, and hopefully, lock in some premium profits. And if Apple goes to $100? Let’s not be greedy. I won’t mind losing some shares at $95 and some others at $100.

I also expect Goldman to make a move this week, but right now its option premiums seem to be undervalued, so I’ll wait. I usually look for a 2% premium for the first 5% increase in price, for a 5 week holding period. This isn’t based on anything. Just my own observations. So with Goldman at $200 on March 16^th, a fair premium, by my reckoning, for the April $210 would be $4.00, and it’s only up to $3.00. So we wait and see, with the sweaty and throbbing veins, pulsing and thready heart rate that is the measure of any junkie.

Oh, and then there’s Blockbuster. I bought it at $6.22 on January 26^th. It’s option expired this past Friday also, pocketing an additional $0.13 per share on the premium. The April premium is looking really appealing, another $0.18 per share or so, after expenses, for the Blockbuster April $7.50. That would be another 3% potential gain on the original stock purchase price. But as the market has gone into it’s first hour, the Blockbuster trade is not to be. It is down $0.17. I should have pulled the trigger when it was down only $0.10.

But patience rewards those who crave the fix. By noon, BBI recovered it all, and then some, and the sale was made at the hoped for price, $0.20 per options contract.

What I conveniently don’t talk about is what happens if the price of the underlying stock goes way down and overwhelms the profits from the options writing. I’m still stubbornly holding on to Ameritrade. Sure I made some money selling options, but not even close to the $5 dive in stock price. Basically, a junkie doesn’t always scrutinize the goods. He just needs the fix, genuine or otherwise.

So what am I to do? Luckily, I was left with a “honey do” list. So, soon I have to get going. I probably won’t get back home until after the market’s close. If only they had wireless in the grocery store. You call this civilized?

I don’t know if this junkie can make it until tomorrow. Well, at least there are no federal holidays this week. Those are killers. Bless the dead presidents, our independence, labor unions, saviors and the rest. But ask yourself, would they really want the markets closed?

I know I speak for them all, when I say:

I think not.

Legacies Must Die !!!    March 16, 2007

It’s quadruple witching today. Does that strike fear deep within? To many, it still does. Legacies have a way of lingering way past their time. Remember William Hung? Was there really a need for a third album?

It’s probably not even worth defining what constitutes triple or quadruple witching. Back in the old days, the simultaneous expiration of options, futures, index futures and single stock options was marked by incredibly unpredictable volatility. Oh, I guess that was a definition. So if today ends up being volatile, add quadruple witching to the culprit list, although sub-prime may be moving down with a bullet. Or up the list with a bullet, depending on how you interpret Allen Greenspan’s latest missives.

Witching days used to be frightening and certainly not for the faint of heart, but for traders, it’s all about the volatility. That’s where the money is made. You don’t need to know anything about the inherent worth of a stock, you just need to have a nose for momentum, and have the nerve to follow that scent. For the rest of us, nothing changes. Take the day off.

Back in the old days, I used to watch the Nightly Business Report on PBS, religiously. Then, as now, it’s hosted by Paul Kangas. I don’t think he’s aged in 25 years. Back then, I thought he was about 80. He actually looks younger to me now. I wonder how that is?

Anyway, back then, the show had a young associate reporter, Neil Cavutto. He was absolutely horrid. It was really painful watching and listening to him. Even if he had something of value to say, you were so focused on his level of unease, that you tuned him out. Too bad he developed the ability to comfortably express his opinions. One more reason to pine for the old days.

But as usual, I’ve digressed. Back in the old days, what bought fear was not an event that occurred every 3 months, but rather one that occurred every week. It was the dreaded money supply reports, M1 and M2. I think there was also an M3, but by the time they got to it, we were all apoplectic with fear. And the markets reacted wildly to the money supply news. To me, clearly a know nothing, the reactions never really seemed consistent, and the spin on the numbers always seemed to neatly satisfy the need for 20/20 hindsight.

So where are M1, M2 and M3 now? They’re not even important enough to make it onto a BIMGO card. No one talks about these anymore. How could something so important, so reflective of the state of the U.S. economy now be totally irrelevant? But that’s just the way it is with everything. There’s no staying power. If you read the fine print on the screen, you’ll see the Viagra has not been evaluated for multiple events. It’s no different from anything else. Here today, gone in 3.2 seconds.

As I’m getting older I realize that Barnum was right. There is an unending supply of newcomers to the investing world. Historical perspective becomes less and less of a player. Everything sounds credible, when there is no perspective.

Today, Neil Cavutto is the toast of the town. Who knows, maybe somewhere on YouTube there is an old Neil Cavuto Nightly Business Report clip. The only thing sadder than his performance in those days, is the possibility that someone else may have taken the time to find and post such a clip. Sad. Even sadder, perhaps, is that in a little while, I may find myself searching for those long lost clips. I do my best to support Google. But those old clips would certainly put things into perspective.

As I write this blog this morning, the futures are down. So what does that portend for the day? I don’t know if anyone has ever done a study to look at the correlation to the pre-open futures and the markets after their openings. To me, there doesn’t appear to be any, other on those days that the futures are significantly higher or lower, and even on those days, the trend rarely seems to last through the day.

Sure enough, an hour into the open, all of` the indices are up. We’ll see what the volatility factor is, as time goes on. I’m sure it will bounce all over the place today, but without the extremes. Those have probably been discounted already. At any rate, they set a volume record for the first half hour, more than 600 million shares, with the market basically flat, after all of that.

This morning, I think I heard the first thing by a talking head that was truly a truism. This comment was indisputable. “Wall Street is all about making money”. This guy may be the first on the money person I’ve ever heard. There should be more like him. Smart money people.

So why are these smart money people, who comprise the pre-open trading getting it so wrong? Or do they? Because there’s no such thing as a smart money person. There are people with money, and then there are people with MONEY. Those with real capital, symbolized by the capitals, aren’t any smarter, don’t know any better, unless they have illegally obtained inside information, yet have the growing portfolios and net worth.

How is that? Because they take risks and are nimble in their executions. They establish their positions early and adjust them as needed. A small profit is better than none, and a small loss is actually much larger, if the capital invested could otherwise have been put to better use. So they don’t stick with losers. There’s always something better out there.

That’s why I left The Nightly Business Report. There was something better out there. It was called Life. My recent bride didn’t understand why everything stopped at 6:30 PM and the dial was turned to PBS. Back in those days, it was still appropriate to use the phrase “don’t touch those dials”. The phrase is still used, and there’s a generation that have no clue what that means. Yes, Virginia, there once was a remote control free television, back in the days when we were all of the same color, black and white.

But I was sneaky. I had conveniently forgotten about that side of me, but I recently rediscovered the evidence. As I was going through old VHS tapes in order to transfer them to DVD, I found plenty of old Nightly Business Report tapes. Conveniently, I had forgotten that I taped them, so that I could watch them without interfering with marital bliss.

All I can say is: “Neil Cavutto. Watch out. Have you checked your YouTube lately?”

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What’s so Great About America?   March 15, 2007

Today, Bear Stearns reported earnings. Four times a year, Goldman Sachs, Lehman Brothers and Bear Stearns announce their earnings, all in the same week. Based on their performance these past few years, these have been glorious weeks.

But what really made Bear Stearn’s announcement so wonderful is that they embody American capitalism. While there is the proverbial blood in the streets and carnage in the wake of the sub-prime debacle, American capitalists jump in, head first.

So what does Bear Stearns announce? They see sub-prime as a opportunity for them. There is value in these overly depressed areas. Lehman said the same, just the day before. The last time I looked, the brothers Lehman and their Wall Street peers were not idiots. They don’t suffer fools, nor losers very well. And you know that if they feel that there is an opportunity in this area, there is already a bottom forming, because why else would anyone want to get out now? Let those who prefer reflex panic end up paying the price.

The Bear Stearns announcement is really a slap in the face to those whose response to an overall weak market outlook was to recommend a shift into safe stocks. Now I have nothing against Altria, at least not as a stock. I don’t like its products, but I do like it as a vehicle. But I didn’t go out and buy any more a couple of weeks ago, as so many urged. Same with Proctor, General Mills and Kellogs. And I currently own 3 of those, I like each of them, dividends and all, but I certainly didn’t increase those positions.

So how have those safe, defensive stocks performed since February 28, the day after the big fall?

In a nutshell, Altria is up 0.55%. Proctor is down 2.48%, Kellogs is up 2.44% and General Mills is down 0.98%. Now how about Campbell’s, my personal favorite. It was down 3.2%, helped out by a downgrade. Oh well, that’s a loser, but as I mentioned a few days ago, I thought that was a good sign for the overall direction of the market. And it does look that way, even more today.

In the meantime, Dow Jones, S&P 500, NASDAQ and Russell 2000 were all down, 0.88%, 0.99%, 1.57% and 1.26% respectively.

So, in fact, an equally weighted basket of safe stocks, not including Campbell’s, would have been down about 0.13%. Down, yes, but still better than any of the indices. Why do they insist on referring to them collectively as “indexes”, when they are clearly “indices”?

My personal portfolios went up 0.93%, with the so-called safe stocks representing approximately 5.5% of the total portfolio value. They, therefore, dragged down my portfolio. Who needs that?

Were there any lessons to be learned from this 2 week period?

Not`really. Because you can spin results any way you like, as long as you’re willing to continually change the parameters, such as time frame. Mutual fund companies do this all the time to their advantage and to your confusion.

As for the myriad of analysts that recommended your portfolio’s transformation into baskets of safe stocks, they’re not likely to offer analyses of their performance, until a point comes that may prove them correct. If that point comes, and eventually, for some random period of time, it must, they certainly won’t tell you of the missed opportunities that also transpired, while you continued to stubbornly maintain your safe portfolio. Full disclosure only pertains to those indecipherable prospectuses, or should it be prospectii, that you receive.

The winds are constantly shifting, but that doesn’t mean that your basic investment philosophy should cave in at the slightest challenge, gale or gust. Had you sold your positions at losses and traded into safe stocks, your overall worth be lower today, because of your newly found “safe” stocks. The Bear Stearns of the world would be happy to profit at your ill-timed losses. That’s part of the big picture

So, the question is: Would you rather feel safe, or make money?

Bear Stearns wants to make money. They’re not espousing conventional wisdom, whereas, a portfolio of safe stocks would have been precisely conventional. Very conventional. Very mediocre.

History does tell us that there is a time to be overweighted in consumer related stocks. If you believe that we are really getting ready to enter into a bear market, why be in stocks, at all. Shift into cash at 5%. But if you think that this is just a lull, albeit, one with lots of volatility, stay invested with your favorites, not someone else’s. As anyone knows, it doesn’t hurt if you lose someone else’s money, especially if they’re sitting on the receiving end of a cathode ray tube. That’s a very anonymous kind of relationship. But it’s not true that “no one gets hurt” You do. It’s always you.

As it turns out, though, today was another great day. Greenspan speaks about sub-prime and the markets seem to find some sense of ease, or so it seems. Who knows, because tomorrow, there will likely be an entirely different spin on the day’s events, as if the world so drastically changed in the past 24 hours.

In the real world, there are certain points during the course of your life that you can point at and say that they were pivotal events in shaping the world. In the stock market, many pivotal points seem to occur each day. Where would you rather live? As bad as the real world may be, it’s a lot safer than the world of irrational markets, inhabited by greedy people seeking fame and fortune.

As Szelhamos would have said to these individuals, “csokold meg a segem”.

I urge you to find a web based translator program and discover for yourself what Szelhamos was all about. You’ll enjoy the sentiment

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Not Just Another Movie Premiere   March 14, 2007

Today was a great day to be an investor, that is, if you like roller coasters. But more on that later.

In a few months, the long awaited, and probably disappointing premiere of The Simpson’s Movie, is scheduled. If you want disappointment though, wait no further. The Dow dipped below 12,000 for the first time since Nov. 2006. The amount of time elapsed since the last sub-12,000 close is equidistant, to the day, until the premiere of The Simpson’s Movie. If you think this is a coincidence, well, one of us is a fool. Conspiracies abound, you just need to know where to lurk.

Everyone, and I mean everyone, who has even a hint of breath in their lives, knows that Homer Simpson and his family live in Springfield, USA. But, we have no clue in which state the Simpsons live. This was probably by design, some 17 years ago, when the producers conspired to keep this secret so they could disclose the information prior to the movie premiere, thus capitalizing on their last remaining asset. Location, location, location.

What? Based on scanty breaking news reports, it seems that The Simpson’s Movie will be premiering in Springfield, at least one of them. Which one? My guess is that it will be limited to a Springfield that actually has a movie theater. I feel fairly confident in saying this, because I speak with 20/20 hindsight.

You see, years ago, I lived in Pleasantville. Like Springfield, there are lots of Pleasantvilles spread around the country. Our Pleasantville was, actually, a very pleasant place. When the movie, Pleasantville, was announced, and set for its premiere, there was much buzz about town, that we would be the site of the premiere, since we were “THE” Pleasantville. One thing that went unnoticed was that “THE” Pleasantville did not have a movie theater. Small detail. Unnoticed detail.

But times change. Now, even Pleasantville has a movie theater. My bet is that The Simpson’s Movie will have its premiere in Pleasantville. That would be the just thing. But I’m reminded that Pleasantville doesn’t really have a movie theater. It has a cinema house, sort of nouveau. Very different. Artsy kind of movies. Unless The Simpson’s Movie was shot in black and white and with sub-titles, it’s not likely to debut in Pleasantville, N.Y.

So it could be in any of the other Pleasantvilles.

I look at The Simpson’s Movie as a much awaited event. A lucky few will get to go to the premiere and perhaps even rub elbows with Homer, the Comic Book Guy and Miles Monroe’s last surviving son. But not everyone will be so lucky. Or maybe they will, because this could end up being a real stinker.

Just like IPO’s. There are plenty of IPO’s out there these days, but you need that movie theater for it to work for you. That’s pretty obtuse, isn’t it? Your guess is as good as mine as to which IPO will be worthwhile. Don’t make your bet if there’s no vehicle to make the company succeed. Vonage is a great example.

Sometimes there’s lots of anticipation for riches to come within moments of the first trade, but how many people do you know that have ever received meaningful allocations of stocks that actually skyrocketed on Day 1. They were quick to let you in on Vonage, Burger King and other great examples. How did those work out for you?

Most normal people get their IPO stocks on the open market long after the easy money has been made. Good luck with that.

But let’s say that you’re offered an opportunity to get in on the ground floor. Imagine that you’re offered tickets to the Simpson’s premiere and you’re provided with written instructions on how to find which Springfield will be hosting the premier. Sounds great, until you see that the written instructions were prospectus-like in their size, language and complexity. What do you do? You either ask someone you trust for directions, ask a stranger for directions, or go to Expedia. Some will even bravely venture out on their own.

I know that some people swear by Expedia and others by Mapquest. Both work for me. Unfortunately, when it comes to an IPO, where do you turn? Your broker? If you’ve never been offered the ground floor on a good thing before, why now? The internet? Good luck with that. It doesn’t take much to start a chat room, and as you can see, any moe-ron can start a blog. So you read the prospectus and are more confused than ever.

Here’s what to do. Stay away from IPO’s. Just because MasterCard was wildly successful, and was actually made available even to the little guys, does that mean that the upcoming Visa will be successful? Be wary if, it too, becomes available to the little guy. I think that would be a bad sign. On the heels of MasterCard, the smart money would have snapped Visa up, if it was such a good buy. Don’t take the crumbs.

And the aftermarket? Do you prefer a vortex or an eddy? Either way you will get sucked in and sucked dry. If you do get in at a decent price, be prepared to take your profits, if any, quickly. Don’t keep waiting for more, you’ll be sorry. Look at I-Robot, SAI and DivX. Stocks like Crocs and Under Armour are exceptions. I got into Under Armour on the IPO day in the aftermarket, sold it shortly after for a profit, but sold it much too soon. A real rarity, but in hindsight, still a good and disciplined decision.

Just be extra careful, especially as the market may be butting up against a short term ceiling. As good as some of these IPO’s may sound, market momentum isn’t what it was just a short time ago. Momentum means a lot.

By the way, the latest culprit in the market’s weakness earlier today was purported to be Daylight Savings Time and the change in trading hours in the European markets, for this week only. This is based on the observation that the volatility in our markets this week all came during the extra hour that the European markets have been opened. So take that Yen Carry Trade.

Some people are just getting desperate for on air time. Show me a single event and I’ll show you a strong association with anything. Reminds me of the guy who refused to get a root canal, because his brother died on the same day that he had a root canal done. What was unsaid was that his brother was run over by a produce truck. Little matter, the association is made. Root canals kill. I suppose you can say that asparagus kills, too.

So today was a great day. The market fought off its Daylight Savings Time sell off and recovered about 150 points. Unfortunately, LSI is again approaching $10 and Apple has broken $90. I’d hate to lose them now that we’re so close to expiration date.

Forgive me, but I hope we have a couple of down days. There are still bargains to be had. I’m ready for more Goldman Sachs and NYSE. Even Ameritrade was up today. What a dog.

By the way, a special shout out to Jenn. She’s the best. Shout outs probably are most effective on the radio. I’m not sure what the equivalent is on a blog.

A special read out to Jenn. Yeah, that has a good feel to it. Not quite as catchy, but I’ll work on it.

And oh yes. Happy Anniversary, Jim Cramer’s Mad Money.

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Is Hideousity a Word?  March 13, 2007

Is Hideousity a word?

In yesterday's Blog I alluded to today's planned to Blog title, “Not Just Another Movie Premiere”.

But that was yesterday and yesterday's gone. There’ll be another time to discuss Hollywood's invasion of small town America. “Not Just Another Movie Premiere” will have to wait for a slow news day. During periods of market volatility slow news day's are sometimes a welcome relief.

Yesterday the world was beautiful. And it wasn't too bad until about 3 o'clock today. Then the world became a hideous place to be. Today's activity in the market could be best described by a single word. Hideous.

As it turns out, hideousity, is not a word, but it should be. What better description of today's hideous behavior? One measure of today's crassness was the news that Viacom was suing Google for You Tube’s alleged copyright infringement. I love YouTube, I love Google. Other than for Comedy Central, I’m pretty indifferent to Viacom, although you had to love the news that now CBS, as had Viacom before it, was reducing the salary of his doddering chairman, Sumner Redstone. Now that's a good result coming from a shareholder lawsuit. As Szelhamos always said "it's a free country". You want to sue? Go ahead, sue. But unfortunately the $1 billion figure being tossed about helped Google to fall $11 today.

What’s truly amazing is that everyone knows that every bit of copyrighted material that “illegally” appears on YouTube, just represents an incredibly cheap and effective way of advertising to people with money to spend. Who do you think posts a lot of the stuff on YouTube, at least by proxy. Who has anything to gain other than the copyright holders?

Was the fabulously popular Justin Timberlake “D**K in a Box” posted by some bored geeks. Not quite. You know that someone at SNL was behind it. Whether there was higher level prior approval is irrelevant, because there was certainly approval after the fact. Within about 48 hours, “D**k in a Box” was a national phenomenon. NBC Universal spends more on personally engraved Bar Mitzvah swizzle sticks than it spent on promoting that SNL piece.

Sumner may be doddering, he may have come late to the party, but he knows a good threat when he makes one. But the one who should really watch out is Tom Cruise. Especially now that the newly impoverished Mr. Redstone says that there’s no reason the two can’t do future business. Who knows, maybe Sumner Redstone may even make amends with his daughter. Meow.

In my portfolio Google comes right after Goldman Sachs. The alphabet, and its derivative application, alphabetization, was a wonderful invention, especially for tracking things, like stocks. Well Goldman came out with great numbers, offsetting some of that hideous Google action. Then, as has been the habit lately, the bottom fell out. That even the strength of these great banking and mergers and acquisitions numbers could turn this toad of a market into it prince. Like the rest of the market Goldman made an about-face and sank.

Was it more sub-prime news? So they say. But if anything, Goldman profits from the lending misfortune of others. So what gives? The answer is, nobody knows, but everyone has an opinion. Not me. I just what Goldman to go back up where it belongs.

Sometimes though, there is some good news, even amongst the dire predictions and there have been a lot of those lately. You remember LSI, don’t you? Once again it looks as if LSI and I will be sharing portfolio space just a little while longer. In typical fashion it closed above the strike price on Monday and then fell enough today to make it likely that won't reach its strike price by the close of trading on Friday. Hopefully too close to within a few cents of its strike price and then it'll be time to sell next month's option. Be careful what you hope for, though. You know LSI’s behavior. 9.75 may be a temporary stopping point down to $8.50. What to do? Hope for the best.

Same thing for another of my favorites, Apple. At yesterday's close it looked like I would lose some of my Apple at $90. Today's well timed sell-off was just the thing. Of course, none of these offsets today's brutal performance. After steadily recouping nearly all of the losses from two weeks ago, today was a big and unwelcome hit. Fortunately, I have a day job. But, if Apple doesn’t reach $90, I’ll be sure to sell more options. I’m not ready to sell the actual stocks, there’s money to be made by lending it out.

I find it somewhat interesting that today was also the day for a meeting of many great minds, such as Paul Volcker, Allen Greenspan, John Thane and Michael Bloomberg, to discuss competitive threats to the pre-eminence of the American capital markets. It reminded me of a “leaders” meeting I went to years ago to work on a consensus statement, regarding a “crisis” situation. The meeting was held in Iowa, a nice central location for the invitees, who were coming from all over the country. When the 3 day meeting was over almost all of us were aboard the same connecting flight to Chicago. Maybe it was the Tangueray and wine talking, but I thought that with about 80% of our “leaders” aboard this one flight, maybe a lot of our problems could be solved. No, not by casual discussion and brainstorming, but by unexpected lightening storming. A well timed “incident” would have created need for a whole new cohort of “leaders”. Wouldn’t that have put us on a better track?

Sometimes a nice tragedy helps you to get a fresh start. It’s like the 5 stages of dealing with death. Of course, I don’t really remember them, because I’m more focused on Margaret Cho’s great routine on the 5 stages of dealing with an unavoidable bodily function that occurs while stuck in traffic. That, and the fact that I haven’t really read many books in the past 25 years. Kubler-Ross? I don’t think so.

The market went down 416 points. We grieved, we got back to life and we crashed again. It’s time to get angry, I think, or maybe it’s denial.

Anyway, the leaders met today to discuss such heady issues as Sarbanes-Oxley, everyone’s favorite whipping thing. So what happens? The market nose dives. Hideousity.

Where’s a good tragedy when you really need one?

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Survival of the Sickest     March 12, 2007

Like so many of us, I now get my news on The Daily Show. It’s concise, informative and devoid of both the gore and the counterbalancing feel good stories. I understand that it’s also supposed to be funny, but I really don’t see it. It’s informative and unbiased. That’s what I want in a newscast. Are you listening John Chancellor?

The other day, the author of the book, Survival of the Sickest was interviewed. He had a fascinating theory on our continuing evolution and the impact of past ancestral behavior and our own past and current activity on our DNA. Some of the theories border on the blasphemic, but if that constrained us, we wouldn’t have such modern day wonders as Laetril and Enzyte.

The very idea that you should take off your sunglasses for a few minutes while out in the sun, seemingly has no life-saving value. But in the world of Dr. Moalem, the very act of taking of your sunglasses enables your eyes to finally realize that there’s cancer causing sun out there. Once the eyes realize that, the message is sent to your brain to start making some skin protecting, and perhaps life-saving, melanin. Amazing.

Equally fascinating is the theory that it is not always the strongest that survive. Faced with the medieval plague, that wiped out much of the European population, the survivors often shared a strange characteristc. They had pre-existing, genetically transmitted, illness - hemochromatosis. A chronic, but not necessarily lethal disease. And why wasn’t it lethal? It was the one disease where blood-letting actually worked. Now how’s that for convenience? The leeches, no not the stock analyst kind, the real leaches, really were effective.

This book has already changed my life. I no longer wear my sunglasses while starting out on my paper route, especially in the early winter. I also now steer clear of all known typhoid, black plague and bubonic plague areas. This has alienated some of my friends, but it’s what Dr. Moalem would have wanted. He’s a good person.

In a way, isn’t it somehow poetic justice that the expression “only the strongest survive” may not, in fact, be accurate? In essence, Dr. Moalem is putting this into a biblical context: “the sick shall inherit the earth”.

But there is something to be said for promoting your financial health, by heeding Dr. Moalem’s observations. He is clearly sending a message of contrarian behavior to the masses.

As far as the sunglasses go, I’m not certain which would be better. Shove them in your ears so that you can’t hear what’s being said, or take them off, so you can see, and recognize for a future time, the faces of the people saying all of those stupid things that will whittle away at your assets.

But definitely take them off and evaluate the now unfiltered opinion that is being sent in your direction, under the guise of gospel truth du jour. Having your eyes protected from the glare of the sun seems like a good thing, until you realize that sacrificing a few minutes of glare-free existence can give you additional years of life. Not a bad trade-off. Have you noticed the excessive use of hyphens, today?

Take them off. Listen critically to the advice that is being sent in your direction, especially if those leeches want you to invest in a hot sector. Do you remember that thing about the strong surviving? History shows that individual investors get into hot sectors way too late. The crowd is always wrong. Last year’s hot sector is this year’s dog.

I love looking at mutual fund performance statistics. How often has a really red hot performer been on the list 2 years, or even 2 quarters, in a row? Unless the appearances were on two diametrically opposed lists. I don’t think you want the worst performer, but that’s invariably what you get, when you filter the information.

What does best over the long-term? Yeah, the non-spectacular, but steady performers. Again with the hyphens.

So at this stage, hopefully you didn’t panic a couple of weeks ago, as the “sunglasses” out there still try to explain the 416 plunge. You have to believe one of them, don’t you. Maybe it’s the Yen Carry Trade, whatever that is. That’s to blame. At least that’s the view of George Soros. Besides being a pretty smart billionaire, he’s also Hungarian, so my money’s on his opinion. I feel strangely attracted to his accent.

But what about all of the worry over the sub-prime markets and the possible de-listing of New Century? Look, this is anecdotal, but this sub-prime stuff is ridiculous. Alright, maybe a couple of fringe players that tried to prey on the weak are going down, but this is a pretty small segment of the home buying and lending community.

The anecdotal part? Where I live, Clarksville (I won’t tell you the state, that’s tomorrow’s topic – “Not Just Another Movie Premiere”), you can’t buy a new home for less than a million. And businesses? They’re putting up new niche businesses and fancy restaurants much faster than the cows can move to new pastures. And they’re all busy, even the cows. Do we really need a high end bra fitting salon? Could we not survive with the lower end franchised bra fitting store?

These homes in my area certainly aren’t being sold to sub-prime borrowers. If they are, then those lenders deserve to go out of business. Although, here, there is a slight contradiction. Here the sickest may not survive. But that’s the point, don’t live our life and predicate your actions on simple and pithy sayings. Look at everything without the filters and treat everything as an unprecedented event.

Okay, some maybe there is actually even some internal spin inconsistency going on. Dr. Moalem’s theories are probably correct when it comes to sub-prime lending. The past behavior of these lenders will no doubt effect the future behavior of lenders.

As home prices go down there should be less of a need to seek out the sub-prime market. That market itself should shrink. But just you wait. As soon as home prices rebound, there’ll be a newly evolved sub-prime lending strategy, but some new moniker, directed at the newly evolved sub-prime borrower group.

Oh Joy.

So, what’s really behind the slow-down by the homebuilders (does that call for a hyphen? – There should be rules) that to some portends such horrible things for the economy and the markets? I believe it’s a healthy response by consumers. Prices have just gotten too high, too fast. It’s time for a breather. They’ll sell and buy again when rational pricing returns.

The sub-prime market was risky. New Century lost, Countrywide Financial has a friend in Bank America, fortunate timing for them. And the others? Who knows? But really, who cares? They lost, so now those homes will be on the market at more reasonable prices. It’s a good thing. Don’t worry. Prices will go up again. They only go down when I want to sell, so I will send alerts out when I am ready to test the waters.

Maybe Dr. Moalem is right, but not always. The only thing that you can count on as an invariable truth is that The Daily Show will always be informative and fair.

That’s really joy

So Long Old Friend   March 9, 2007

Do you remember this incredibly maudelin and depressing song from the early ‘70’s?

Goodbye to you my trusted friend
We've known each other since we were nine or ten
Together we climbed hills and trees
Learned of love and A B C's
Skinned our hearts and skinned our knees.

Goodbye my friend it's hard to die
When all the birds are singing in the sky
Now that the spring is in the air
Pretty girls are everywhere
Think of me and I'll be there

We had joy we had fun
We had seasons in the sun
But the hills that we climbed were just seasons
Out of time......
 

It’s that time of the month that I both dread and love. It’s one week before options expiration. It’s a perverse time, when you don’t know what to wish for. Each month, I have to mentally prepare myself for the potential loss of some old friends.

Let me tell you the story of LSI. As recently as yesterday, I thought that I might be saying goodbye to my old friend LSI. The market is cruel. I went through this with LSI just a month ago. I was ready then and then LSI was spared. It looks as if the same may now happen this week, but remember the cruel nature of market trends. Just at the final moment last month my dear LSI was snatched from the jaws of exercise.

But I’m ready to say goodbye to an old friend today. Goodbye SI. Goodbye. As much as I practice it, though, I know it won’t be easy.

It’s never easy, when it comes to this. LSI was a good friend. Not spectacular, but a good, solid and reliable friend. That is as long as you focus only on its amazing ability to revert to the mean.

But you know, and I know, that LSI’s time will come. If not by next week, then by the 3^rd Friday of April, or May. Could I posssibly hope for June. Or am I being selfish. I just want to keep LSI with me, and of course continue to profit from LSI’s predictable dual nature: LSI up. LSI down.

You see, it all started when I first bought LSI. I didn’t even know anything about LSI’s past. I knew it was chips or something like that, but I liked those charts. Oh, those charts. As it turned out, it was pretty much a one night thing, at first. After just a few trading days, I sold my LSI for a 6% profit. That was nearly 18 months ago. That was the first time I experienced LSI’s biochemical disorder. LSI up. LSI down. But I felt empty. I bought LSI all over again not even 3 days later, after a 7% price decline. My feelings for LSI were so strong, I bought even more the second time around. I was hooked.

But money does a strange thing to a person. As much as I adored LSI, I began to hire LSI out to others. For money. For Money. I feel so ashamed now. It’s hard out there for a stock pimp, but daddy’s got to pay the milk man. Yeah, you know what I did. I sold call options on LSI. And don’t look at me like that. I know that you’ve thought about doing the same thing yourself. So what if some stranger could get his dirty hands on my LSI, it’s not like LSI was an IPO and didn’t know the ropes. It knew what it was getting into when it came into my stock portfolio.

So I sold my first call options. The LEAPS looked promising. They were willing to pay top dollar for LSI, as long as I didn’t mind LSI staying with them for a long time. Who knows, maybe they would also “rent” LSI out. But LSI was still in my portfolio, not theirs. So I jumped on the cash. And what did LSI do? It went up, right past that strike price, and then some. But I wasn’t worried. I knew my “business associates” were in it for the long term and had no interest in exercising their options until the very last moment, still nearly 2 years away.

So as I waddled in my LSI dirty money, I watched as LSI’s price withered under the aegis of it’s faceless option holders. Now I’m no hero, but I knew what the right thing to do was. I bought back my options. It was the right thing to do, and oh yeah, it also returned a net premium that was the equivalent of another 6.7% profit over the buy price. Not bad for a few month’s of LSI-less life.

But LSI does what LSI does. Up. Down. Up. Down. And I was getting tired of the inconsistency, but I couldn’t bear pimping LSI out for so long. This time I found some short term options buyers. One month, two months tops. Another 4% profit in one month, but it wasn’t without excitement. Just as scripted, LSI went over the strike price and just 2 days before expiration tanked below the strike price. LSI was still mine. I must admit, however, that I did part with some of my LSI, not all of my shares were backing covered calls. I just couldn’t resist the profits that were to be had.

Oh, and in-between there were a couple of 10 day dalliances with LEAPS again. It was hard to resist. Another 5%. You know why. LSI up. LSI down.

Now here we are, another expiration date coming up next week. Just a couple of days ago, I thought that this was it, but LSI up. LSI down and it looks as if we’ll be together for yet another month and another 2.8% profit.

And what if LSI does its bipolar thing before next Friday, and gets exercised? So, it adds up to another 4%. Not bad.

But I hope LSI stays below 10. I want that thrill of sweating out another expiration week. Just one more time with LSI, that’s all I ask. Apple, Google, NYSE, Genentech and the others, you’ve all been good to me, too. But you’re all just another stock in my stable.

It’s LSI that I’ll miss.

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Today’s Blog  Getting it Right – The Fifth Time  March 8, 2007

I must be onto something. No sooner do I infer a recommendation for Campbells (CPB – NYSE), than it is downgraded. This is perfect. Not necessarily for Campbells, although it is recovering from the Goldman downgrade, but for the all important big picture. Campbells is just a bit player. Downgrading Campbells is the best thing to come from the analytical world since Freud realized what a cigar really represented.

How can a relatively puny company downgrade be a good sign for things to come in this market? Wasn’t this whole group being pushed as the haven during a downward spiral in the market? I guess the analysts noticed that cans of Campbell’s soup were being replaced in grocery store aisles by oil refinery rigs. Could it be that the big play for defensive safe stocks is over? Already? So fast? Does that mean that the “crash” is over? Crash, we hardly knew ye.

Not very much seems to make sense this past week. Out of nowhere the market dives 416 points, goes up 55, down 120 and up 65, not to mention the intraday volatility. My best educated guess is that the market is attached to a bungee cord. Did I mention that, realistically speaking, 3^rd grade will soon be within my reach?

So the philosophical question to ask is: Which would snap up faster after its way down? A bull or a bear? I‘m certain that Galileo ran a similar experiment. But I’m not willing to risk excommunication, by even guessing at the answer. We know that they should both fall at the same rate, but how about the rise back up?

Sure, I’ve heard of bear traps, but the bull has to touch down before the trap activates and snaps off its hindquarters. But this bungee jumping bull never touched ground. He didn’t listen to the dire predictions. He’s back up. No, this is not a Cialis ad, just an observation. Unless that bungee snaps, the bull will be back up again and again, albeit in smaller increments each time. At some point, that bovine will dangle too closely to the trap. Then it’s a freefall.

So each time that bull is headed down, there’s yet another opportunity to get it wrong. Using some simple differential calculus, yet another homage to Dr. Thomas, five bounces should do it. So expect the futurists to keep getting it wrong for a while. Now I’m not a technician, I don’t know oscillators from Bollinger Bands, but I know the dead cat bounce. This isn’t it. What makes all of this so great is that each time the bull heads back up – you guessed it. Another opportunity to get it wrong. You can’t lose.

But getting it wrong is what the experts do. They’re quite good at that end of things. Too bad there are no futures exchanges on futurists. I suppose I would recommend always holding a short position. In the past couple of months how many revised price targets have you heard for the likes of Apple or Google. How many changes from Buy to Neutral, Neutral to Buy, Neutral to Underaccumulate – you get the idea have you heard. Google 600. No Google 535. No, 560. It’s a bungee. I was right. What else could it be?

In the world of major league baseball, if you get a basehit 30% of the time you deserve to be inducted into the Hall of Fame. If you’re an analyst and you get it right 30% of the time, you deserve to be indicted for insider trading.

An additional, yet so far unproven thought, is that the bungee cord is wrapped tightly around the necks of the most vocal and visible of the analysts. The resultant lack of oxygen likely having consequential effects on their cognitive activity and short term memory. Following the 400 point drop off last week, the market is barely up 44 points. So why is this being called a surge? Funny thing, it’s called a surge by the same one’s that a week ago were warning of a deeper crash. The bungee noose must be tightening.

Now I’ve steadfastly believed in the continued strength of the bull, or perhaps more accurately, the integrity of the bungee cord, but I wouldn’t call a 0.3% increase in the Dow a “surge”. It might be better described as a “non-event” In fact, having sentiment shift toward an optimistic spin of events can’t possibly be a good thing. When you see a tidal wave coming your way do you rush headfirst into it?

The world of group psychology is a perverse one. There’s a lot to be said for going with the crowd if you fear for your safety. But no one ever got wealthy by being defensive. The crowd only drags you down. But I’m not certain what to hope for. I do want to see the crowd be right, but I would so much rather have the crowd confidently predicting the next big market downturn. My portfolio did much better these past few days while everyone was still talking about the bear trap ahead. Now that it’s surge talk, I don’t see anything good on the horizon.

But back to the bungee. Imagine tying that momentarily bear loving crowd to the bungee. The sheer weight of their negativism would drive that sucker back up with a mighty snap, after any cliff diving. And that cliff was pretty high up. Unless that bungee was made or supplied by the lowest competitive bidder we can be fairly certain that it will neither snap, nor be too long. Ironic though, isn’t it. That being long in stocks is a bad choice if the bungee cord is too long, but being short in stocks is even worse.

Why is it worse? The worst that could happen with a long cord is that you go splat. The bull gets flattened. So you start again. So what? But if you go against the market with that perfectly constructed and measured bungee cord, the sky is the limit. And that’s a bad thing, if you don’t own the stock, or if you sold your stocks in a moment of group hysteria. Either your losses are limitless or your foregone profits are limitless.

I don’t mind these bounces. I certainly wouldn’t mind a few more.

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Trust, but Verify       March 7, 2007

Trust, but verify. What incredibly powerful words.

There with me to as you read the today's block. You see the only using 80 word recognition software program for today's block. I've spent extensive time training program to recognize my voice.

The number of years ago, Snohomish was interested in putting his memoirs on paper. Now sell Moorish never typed word in his life. So I had to brainstorm and we should go out and buy the word recognition program. The if you've ever used to you know that the teens English is the preferred pronunciation. Self-promotion is 50 Hungarian accent is a challenge to put it mildly. Additionally his propensity to insert the word for the cancer every other word seemed to be confusing to the word recognition program.

After about three hours of trying to get through some training text to computers suffered a meltdown. Its processor couldn't take the intense heat generated by the software program is a choice to cope with Snohomish is you need to stay on a English language.

Because it turned out to remember that those memoirs. Fortunately, the oral tradition of passing knowledge to continue strong and.

A few years ago in good friend of mine has the termite letter of recommendation for his daughter who was applying to graduate school. I decided to use my trusty word recognition program. Luckily I believe in trust but verify. I have full confidence in the ability of the software engineers to make a functioning product. The after in-depth training with the program I was ready to make use of its wonderful time-saving features.

With great confidence that dictated the recommendation letter. Of course, I reviewed the letter for accuracy before sending it or to the schools of a choice. As you can probably dance the letter was essentially none since the her name was altered in unrecognizable fashion in the letter seemed as if you was written by a orangutan. It took me much longer to edit the the letter since they didn't really remember what exactly that said and very little of the dictated that are really made antisense.

A pop maybe my $100 to buy me the best of software programs. But I find it back so many medical to patients by radiologists and surgeons for example to qualify with the expression dictated but not yet. I suppose that the quality of the patients medical record is not an important for the patients to actually be read before being entered into the medical record. I guess trust but verify has no place in health-care.

As you read through this block the you've probably get a sense them to the same thing. Except this time, using a new and improved three generations later word recognition program.

Not very good visit.

So now, if you don’t have a roaring headache from the preceding “dictated but not read” paragraphs, please read on and see the edited version.

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Trust, but verify

Trust, but verify. What incredibly powerful words.

Bear with me as you read today's Blog. You see I’m using a word recognition software program for today's Blog. I've spent extensive time training program to recognize my voice.

A number of years ago, Szelhamos was interested in putting his memoirs on paper. Now Szelhamos never typed word in his life. So I had the brainstorm that we should go out and buy a word recognition program. If you've ever used one you know that the queen’s English is the preferred pronunciation. Szelhamos’ thick Hungarian accent was a challenge to put it mildly. Additionally his propensity to insert the word “the” after every other word seemed to be confusing to the word recognition program.

After about three hours of trying to get through some training text the computer suffered a meltdown. Its processor couldn't take the intense heat generated by the software program is tried to cope with Szelhamos’ unique take on the English language.

As it turned out he never got to those memoirs. Fortunately, the oral tradition of passing knowledge down had continued strong.

A few years ago a good friend of mine asked me to write a letter of recommendation for his daughter who was applying to graduate school. I decided to use my trusty word recognition program. Luckily I believe in trust but verify. I have full confidence in the ability of the software engineers to make a functioning product. After in-depth training with the program I was ready to make use of its wonderful time-saving features.

With great confidence I dictated the recommendation letter. Of course, I reviewed the letter for accuracy before sending it off to the schools of her choice. As you can probably guess the letter was essentially non-sensical since the her name was altered in an unrecognizable fashion and the letter seemed as if it was written by a orangutan. It took me much longer to edit the letter since I didn't really remember what exactly I had said and very little of the dictation actually made any sense.

Maybe my $100 didn’t buy me the best of software programs. But I find it odd that so many medical dictations by radiologists and surgeons, for example, are qualified with the expression “dictated but not yet read”. I suppose that the quality of the patient’s medical record is not important enough for the dictations to actually be read before being entered into the medical record. I guess “trust, but verify” has no place in health-care.

As you read through this Blog you've probably sensed that I’m doing the same thing. Except this time, I’m using a new and improved, three generations later, word recognition program.

Not very good result.

Not a good result, at all.

Although “Trust, but verify” may have no place in medical records, it certainly does have a place in creating and maintaining your portfolio. There are so many opinions and recommendations out there for you to consider. Who do you trust? The person that is most amusing? How about the one who is most trustworthy looking? Maybe the one who has “past Fed Chairman” as part of his resume?

Trust everyone. But verify. Don’t go blindly on trust. 99% accuracy rating on the dictation program? I don’t think so. No one cares about your portfolio as much as you do.

Since verification may take some time, you would not have jumped to sell stocks over the past week, as you critically assessed the blame that was being spread around for the precipitous drop. Was it the “collapse” of the sub-prime market? Was it a Chinese stock market`meltdown? How about a breakdown of the NYSE’s systems?

So far, as it’s turning out, whatever was at root cause for last week’s fall, may have been fairly superficial in nature, and not reflective of an endemic or deeply rooted problem. Where would you be right now if you went with the crowd? You would have dumped your stocks right into the hands of someone waiting for a bargain. I picked up some more Goldman Sachs at a bargain price.

And guess what? It was up about 3.5%. And what about those deep in the money NYX options? So far, about a 16% increase in about 3 days. I think there’s more to come.

But don’t trust me. Verify me.

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If Andy Worhol only Knew   -   March 6, 2007

This is getting old. I feel like talking about something other than the “market crash”. That’s all you can hear about right now. All this talk about moving into defensive stocks, positioning yourself for the continued downdraft and how China owns us: lock, stock and barrel. It’s all getting very old. Now, I’m not a very sentimental sort of guy, but all of this dwelling on a single issue has me pining for the old days.

How I miss the Anna Nicole story and its coverage.

As I try to clear my mind of all of this market fear, I find myself thinking about Andy Worhol. Not because his image is conjured up when considering the panoply of defensive stocks, such as General Mills, Proctor and Gamble and Kellogs, that everyone is recommending for this “downturn”. Inexplicably, no one thinks of Campbells (CPB – NYSE), at these times. And Campbell’s has been a better 1 year performer than any of these other safe stocks and currently offers better value.

No. I was thinking about Andy Worhol’s oft quoted and misquoted 15 minutes of fame line. It’s actually a very scary concept, when you realize how easy it seems to be to get that notoriety. Do you think that anyone in Armenia knew who Abraham Lincoln was before he was shot? How about for the 75 years after he was shot? Not likely.

But is there anyone in the world who hasn’t seen the Treadmill Dance? So here I am trying to memorialize Szelhamos, and what do I find during a cursory Google search? Coincidentally, Szelhamos’ first grandchild, is named Andy. Well, it seems that the latter day Andy peddled his product opinions and reviews on a website, one of many, that solicit reviewers with an enticement to profit from each click on their reviews.

The last posting modern day Andy made was in 2000. He was all of 13, going on 14. Sometime between then and today, his reviews have been accessed nearly 8,000 times !! As far as monetizing his efforts, I don’t know if dime one has ever materialized, but I still can’t fathom 8,000 hits. But then go over to You Tube and see just how easy it is to get millions of hits in no time at all.

It would probably take a CDC epidemiologist to explain the rapid spread of information. But just as soon as a website takes off and attempts are made to monetize the model, something funny happens. Once again, the epidemiologist would be helpful at this point.

There is a mutation that comes along. Just as that popular site, or the fools who bought the popular site from its founders, is ready to cash in on its popularity, someone comes along and does it one better. And for free.

And Andy Warhol was right. In a 21^st century adjusted time span of just 15 minutes, what was cool is now ashen. Not only will the Treadmill Dance become passe, but what does the future hold for corporate owned entities like MySpace and You Tube. Maybe Serge and Larry bought You Tube just for kicks, but I’m certain that Rupert wants his money. Just apply the modified version of the Heisenberg Principle. The very act of buying a wildly popular and free service forever changes it.

Speaking of 15 minutes of fame, does Alan Greenspan really need those extra 15 minutes. Clearly, he has learned how to monetize his time. Does he really need to? Apply the modified Heisenberg Principle to Alan Greenspan and you’ll see what can happen.

His latest is the pronouncement that there is more than a 30% chance of a recession this year. What does that mean? Is it good news or bad? Is it up from 29% or down from 32%? Even when he speaks clearly no one has any clue of what he is saying.

The futures, though, are up about 90 points over fair value early this morning. Was it Greenspan or the recovering European and Asian markets. The only way to know is if at his next paid speech, he raises or lowers his recession targets. Then let’s see if anything happens. In the meantime I’ve asked the Asian and European markets to remain closed so that we can properly assess the impact of Greenspan in a vacuum. They’ll get back to me.

In yet another unscientific effort, I scanned Amazon for scholarly works by Drs. Bernanke and Greenspan. Sure enough, I found a textbook on Macroeconomics, co-authored by Abel and Bernanke. What showed up for Greenspan? Framed and unframed copies of his Person of the Year cover appearance in Time Magazine.

Both you and I know, though, which one is more likely to be placed in a time capsule. Poor Ben Bernanke. It’s tough having to deal with the ghost of your predecessor, especially if he’s still alive and very much kicking.

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Remember 1987?    -     March 5, 2007

Remember 1987? I do. Ah, 1987. Hated it !

I was still young. Our first child was barely a year old, the Mets did not repeat their world championship season and Alan Greenspan was entering into his second year as Chairman of the Federal Reserve.

Oh yeah. The stock market crashed. In nearly forgot about that, although I remember exactly where I was when I found out. On the slowest moving elevator in the New York City Municipal Hospital system, on my way to the 13^th floor. For purposes of this blog that's a good thing that I didn't forget about that. So why am I remembering the crash of 1987. What are the parallels to 2007?

Well, there are some. Uncle Ben Bernanke is also entering his second year as chairman of the Fed and lots of people are scared and selling stocks. Especially those Europeans.

For me, the parallels end right there, fortunately. You see, back in October of 1987 all of my discretionary money was invested in stocks and I had only discretionary money, which means that I had no other kind of money. Big mistake.

My wife and I were home shopping every single weekend looking for that perfect place for our new child to grow up in. (note to self – never end a sentence with a preposition). Any and all money that we were saving would immediately be put into our investment funds. And why not? The paper profits kept coming in.

The plan? Find the perfect house, cash out our growing portfolio, make that 20 percent down payment, have cash to spare for furniture and, decorations and live happily ever after. Well, it didn’t exactly work out like that. Well, it almost did.

You can probably guess where I’m going with this. Just as we found the perfect home, the market crashed. We saw our portfolio value drop like a rock and that happened without even a single speculative stock in the portfolio. I even had the good fortune of holding the single largest percent loser of the year, L.F. Rothschild. Something like 97%!!! And that was a good company?

If we would have found the house a week earlier or maybe just a few months later life would have been a lot different. And by different, I mean less stressful. In by less stressful, I mean better.

We both really wanted that house. We had spent six months looking and the real estate market was hot. Who knew when we would find another dream house within our price range? The only problem? Our portfolio was now worth a whole lot less and I didn't really want to sell. With the exception of Rothschild, it was a good solid portfolio.

But I had to sell. We took the losses. I cringed. I swallowed hard. Sucked down a tear or two and then swore that I would never invest anything other than my discretionary money. Of course, as it turned out, at that time I really didn’t have any discretionary money. It was all earmarked for a necessity – shelter.

What did we end up doing? I still cringe thinking about it, although I’m no longer sucking down any tears. 20 years will dull some of your senses and emotions. I Cashed out a 403b. My precious retirement pushed off that much further on top of that obscene 10 percent penalty. And the taxes. Oh the taxes.

I had to beg the IRS for a payment plan. The IRS agent said ‘no” to my initial request. But, upon getting ready to hang up the telephone, the agent told me his name. As if I really cared. But, he had the same obscure last name as past work acquaintance of mine, whose home I had visited to pay respects following the death of his mother some three years earlier.

Although I had not seen him since then, I asked the agent if he had a relative named Julian. Funny thing. It was his son. And coincidences of all coincidences, it was his house that I had visited to pay my respects to Julian's mother - the IRS agent's wife. Suddenly, Julian’s father found a way, a relatively painless way, to pay back the taxes.

So, as it turned out, we bought the house and moved and stayed for about eight years. Remember that list of dreams we had, though? We almost achieved everything. We did live happily ever after, albeit without much new furniture. That's the price we paid for investing every last cent, even the cash that truly was not discretionary. It would have been much worse had Julian's father not helped us out.

I learned a lot from the crash of 1987. Don't invest money that you can't afford to lose. Don't invest money if there’s even the slightest chance then you'll need it in the short-term. I hate taking losses and I especially hate taking losses because I'm forced to sell.

Szelhamos always said “It’s a free country”. I had a choice. Back in 1987 I don't believe the expression “between a rock and a hard place” had taken hold yet. But that would have described it well. I had a choice, but I didn't really have a choice. That’s a sure way to guarantee stock market losses. The last time I looked, that was not my primary objective in buying stocks. Maybe it's yours, after all, it is a free country. But it's not my choice.

So what are the parallels to 1987, besides Greenspan and Bernake’s length of tenure? For me there are none. I don't have every last cent invested. I actually have some speculative stocks in my portfolio, but I'm emotionally prepared for them to tank. If some of them don't, then I'll just happily take my profits. Now, I’ll trade at a loss only if I believe my money has a better opportunity elsewhere. Not because I have to!

Ending on yet another preposition. But I just had to.