Insomniac Hedge Fund Guy

No one knows more about housing than this guy.  In fact no one knows more about the economy in general.  He’s the man in my opinion. There is a video of the entire Economics class he teaches available for free download on Apple U. It’s still too soon to call a bottom in housing, much less the start of a boom, says Yale University economist Robert Shiller. It’s still too soon to call a bottom in housing, much less the start of a boom, Yale University economist Robert Shiller said Wednesday on CNBC. via Robert Shiller: Don’t Await Housing Boom.

I thought this article from Saturday’s NY Times was propitious and something Sax Angle readers could benefit from.  After reading this, one can’t help but draw the conclusion that we are heading into a lot more volatility during the first part of the New Year.  These things invariably get worked out or as Winston Churchill was quoted as saying, ” depend upon the Americans to do the right thing after they’ve tried everything else.”  Volatility can be your best friend or your worst nightmare.  ONLY YOU can decide which one that will be. The government is within days of hitting … Read more

Ironic, we have been railing about this for some time now.  Glad to see the WSJ picking up the baton. In 2007, a top securities regulator warned that executives could be abusing preset plans to buy and sell their companies stock “to facilitate trading based on inside information.””Were looking at this—hard,” Linda Chatman Thomsen, then-enforcement chief at the Securities and Exchange Commission, told a conference of corporate lawyers. via SEC Draws Fire Over Executive Trading Plans – WSJ.com.

Insiders know what they are doing.  They have a huge advantage over the common stock investor. That’s why the SEC has laws intended to level the playing field.  Come to our Investment Survival Workshop Wednesday 6:00PM at the Blind Dog and learn how you to can GAME the system,too. By SUSAN PULLIAM, JEAN EAGLESHAM and ROB BARRY Federal prosecutors and securities regulators are taking a deeper look into how executives use prearranged trading plans to buy and sell shares of their company stock. The Manhattan U.S. attorney’s office has launched a broad criminal investigation into whether seven corporate executives cited … Read more

I’m not predicting a housing price collapse but all four of these events are almost certain to happen to some degree and none of them are good for house prices.   Four Major Events That Could Topple The Housing Market All Over Again Has The US Housing Market Really Bottomed? Most Americans have heard of the “fiscal cliff.” The term — first used last year by Federal Reserve chairman Ben Bernanke — refers to the economic disaster that awaits America if tax increases, spending cuts and budgetdeficit rules go into effect in January 2013 if the Democrats and Republicans in … Read more

The next and last Investment Survival Workshop for 2012 will be Wednesday, December 12th at the Blind Dog at 6:00PM.   No Products or Services are sold at these workshops.  They are for qualified investors with at least $500,000 of liquid assets.   If you haven’t been to one of these workshops you are missing the most informative investment experience you will likely have all year.  The feedback has been overwhelmingly positive.  This workshop will be conducted by Jeff Day and Harvey Sax.  Mr. Sax is one of the top ranked long short equity fund managers according to Barclay Hedge, … Read more

I thought this article in today’s NY Times was interesting considering that so much of insider trading is readily available to anyone that wants to take the time to follow and analyze the SEC filings.  Read more about our views on this money making strategy at Learn how insiders beat the market.     Insider Trading Persists, and Gets Stealthier – NYTimes.com.

Recent pull pack in a number of these names stimulated insider buying.  Perhaps the largest amount of buying in this name, CYS.  The Fund picked up a sizeable stake.   CYS is a mortgage REIT that invests primarily in Agency RMBS. It pays a great 14.05% dividend. With the Fed backing up the housing industry, this is one of the safest investments in an uncertain investment world. The Fed is not likely to let the housing market drop much from here. The Fed is keeping mortgage rates low. It has said that it will keep Fed Funds rates low until … Read more

The Dow Jones Credit Suisse Hedge Fund Index Finished Up 0.64% in November   New York, December 17, 2012 – The Dow Jones Credit Suisse Hedge Fund Index (the “Broad Index”) finished up 0.64% for the month of November. Performance for the Broad Index and its 10 sub-strategies is calculated monthly. November, October and YTD 2012 performance numbers are listed below and are available atwww.hedgeindex.com.   Category Nov 2012 Oct 2012 YTD 12 Dow Jones Credit Suisse Hedge Fund Index 0.64% -0.18% 6.10% Convertible Arbitrage 0.22% 0.25% 6.36% Dedicated Short Bias -0.43% -0.07% -17.97% Emerging Markets 1.10% 0.35% 7.72% Equity Market Neutral … Read more

  FRANKFURT — For all the talk about Germany’s financial exposure to Greece, it turns out that some German banks have a problem of more titanic proportions — their vulnerability to the global shipping trade. Germany’s 10 largest banks have €98 billion, or $128 billion, in outstanding credit or other risks related to the global shipping industry, according to Moody’s Investors Service. That is more than double the value of their holdings of government debt from Greece, Ireland, Italy, Portugal and Spain. And it is more than any other country’s financial exposure to the shipping industry, which is in the … Read more

This chart from BlackRock states the obvious. Most people are terrible investors.  The real question is how much better is BlackRock.     Volatility is often the catalyst for poor decisions at inopportune times. Amidst difficult financial times, emotional instincts often drive investors to take actions that make no rational sense but make perfect emotional sense. Psychological factors such as fear often translate into poor timing of buys and sells. Though portfolio managers expend enormous efforts making investment decisions, investors often give up these extra percentage points in poorly timed decisions. As a result, the average investor underperformed most asset … Read more

Some Analysts Doubt Dire Predictions on Tax Increase Fallout By NATHANIEL POPPER As anxious investors assess their portfolios in light of expected tax increases on investment income, hedge fund manager Douglas Kass has a simple message: Relax. Related Debt Reckoning: The Fiscal Deadline in Washington Mr. Kass, the founder of Seabreeze Partners Management, thinks much of the investing world has overestimated how hard the markets and investors would be hit if tax rates on dividends and capital gains rise at the end of the year, as the White House has proposed. via Some Economists Doubt Dire Effects From Tax Increases … Read more

The Dow Jones Credit Suisse Hedge Fund Index Finished Down 0.18% in October   New York, November 15, 2012 – The Dow Jones Credit Suisse Hedge Fund Index (the “Broad Index”) finished down 0.18% for the month of October. Performance for the Broad Index and its 10 sub-strategies is calculated monthly. October, September and YTD 2012 performance numbers are listed below and are available at www.hedgeindex.com.   Category Oct 2012 Sep 2012 YTD 12 Dow Jones Credit Suisse Hedge Fund Index -0.18% 1.04% 5.42% Convertible Arbitrage 0.25% 0.40% 6.12% Dedicated Short Bias -0.07% -3.78% -17.62% Emerging Markets 0.35% 2.21% 6.55% Equity Market Neutral … Read more

Goldman’s Top Ten Market Themes For 2013 Submitted by Tyler Durden on 12/02/2012 16:55 -0500 Whether you trust the squid and their thought process or believe in ‘better the devil you know’, Goldman’s top thinkers – from Garzarelli to Himmelberg and from Stolper to Hatzius and Wilson – lay out the top ten global macro themes from their economic outlook that will dominate markets in 2013. Agree or disagree, one thing is for sure – these ten ‘themes’ will impact us all one way or another and for each theme, Goldman discusses the wider implications for markets, and the potential … Read more

After listening to the rounds of Sunday talk shows and watching the Fiscal Cliff talks progress, it seems inevitable that some combination of tax hikes and budget cuts are ahead. Whatever the final budget and tax numbers turns out to be its almost certain to have a dampening effect on economic activity.  The economy is growing at about a 2% rate and so far quantitative easing and  has yet to ignite anything close to job growth.  A less accommodating fiscal policy which seems a certainty may even reduce this torpid rate.   Some initial observations and then I’ll offer some … Read more

One of the things we key in on in the Investment Survival Workshop is how to benefit from insider trading.  Check this article out.  It’s far more complicated than meets the eye.  Come join us at our next workshop and find out whow we discern the good from the bad.   Executives’ Good Luck in Trading Own Stock ABy SUSAN PULLIAM and ROB BARRY A timely share sale by two insiders at retailer Body Central Corp. BODY -1.44% this spring spared them a nearly $1.4 million drop in the value of their holdings in the chain. Enlarge Image Bloomberg News From … Read more

Corning has insider buying, a deeply discounted stock priced based on the DCF model, healthy dividend, and finally a catalyst.  Yes, Gorilla Glass has been huge but the market already knew that.  It’s finally TV’s that are coming back, bigger than ever as the moribund housing market heats up.   Let’s hope the move to bigger and thinner TVs has legs.  We are long GLW Corning Touches on Apple Upside By DIMITRA DEFOTIS | MORE ARTICLES BY AUTHOR The maker of glass screens for LCD TVs, iPhones and iPads cheered investors after forecasting strong demand for this quarter. ‘Tis the season for … Read more

This is what I find astonishing about the mealy mouthed Wall Street analyst community.  I’ve got a chest thumping buy on the whole sector and this utility analyst sheepishly says it might be a good time to buy utilities. It’s not a good time, it’s a great time.  They are the single biggest buy in the market right now. Top Picks in Regulated Utilities Credit Suisse likes Duke, Dominion, Edison International and three others. Regulated Utilities have been clobbered since Nov. 1 in response to a confluence of well-discussed factors, but we do see a good case for owning them. … Read more

Some more nonsense on the fiscal cliff.  What I want to know is how can anyone drive over a cliff that everyone sees?   Goldmans Guess At Cliff Compromise Composition | ZeroHedge.

You might  argue that a million dollars is chump change for Robert Iger and you are probably right but it’s good to remember that the last time he bought Apple was on 11/29/11 shortly after Jobs died and he paid $374.90 for it.  He bought 2670 shares then, a million dollars worth. My experience is that no matter how rich people are they still like to buy at a bargain and I assume that’s exactly what Iger is doing.  

You might think us crazy but we’re buying the worst performing sector in the market this month, utilities.  In particular we are buying the XLU and Dominion Resources. XLU,S&P Select Utilities fund  represents a basket of the largest public utilities in the country yielding about 4.18%.  The utilities index is down a stomach sickening 8.34% for the month of November alone.  This is the biggest one month drop since the market collapse of 2008. Is the elimination of favorable tax treatment on dividends as big a threat as indicated by the collapse of the index. We don’t think it is. … Read more

Well, I feel kind of like I stepped into that punch.  The initial market reaction to the obvious reelection of President Obama is still puzzling to me.  After all betting sites, like Intrade had the election a near lock.  I guess I should have seen that one coming.  After all the market has a way of screwing the most people it can most of the time. Since Obama was a lock, there was really no uncertainty to remove.  Market pros faded certainty instead of buying it.  A lot of pundits like to say it’s the fiscal cliff but I don’t … Read more

The problem with Apple is not with the demand, it’s with the supply. Hon Hai Says iPhone 5 Design Leads to Production Delays   —A key supplier to Apple Inc. AAPL -3.80% said Wednesday it is shipping “far fewer” new iPhones than the Cupertino, Calif., company has requested, because some quality standards still cant be met due to design-related production difficulties.Supply-chain problems have led to a long wait for the iPhone 5 since the devices late-September launch, analysts said. The scarcity of the phones has been weighing on Apples share price as well, as investors are concerned Apple may not be … Read more

Whew, I’m glad it’s over.  The market sell off today is a gross overreaction.  If we had four more years like the last four, the market would record one of the best all time returns for a President in history. Granted Obama took office when the S&P 500 was in the midst of a market crash.  That always helps the reference points. But none the less Obama has been relatively very good for stocks.  Will that continue? I see no reason why it wouldn’t.  As I’ve stated before, economic growth and stock market returns are nowhere near correlated as the … Read more

I found this article revealing.  The recent Apple press release  labeled as iStorm is an alarming development for Apple shareholders.  At first, and of course who knows really, I thought the stock could sell off sharply.  Now I don’t think so.  In fact it might be a long term positive.  All things considered, though, I say it goes down in Europe Tuesday (tomorrow). Scott Forstall and Maps, Siri issues by Kelly Hodgkins Oct 1st 2012 at 1:30PM The recent criticism about Apples iOS 6 Maps app has prompted some analysts and pundits to lay the blame on Scott Forstall, Apples Senior … Read more