Buzz Bits: Dow, Nasdaq Close in the Red
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Gaianomics 101 - Woody Dorsey - 12:23 PM
Gaianomics: Planetary Influences on the Economy.
The Bushman and the Bernankeman are important but they are insignificant compared to the Weatherman. The world... and the world of markets is waking up to the importance of ClimateChange and planetary scarcity. The fractals of weather are also tradable. Note the very recent rally in energy...due to weather and Geopoliticals which are in themselves a kind of weather.
My firm had forecast a hot Summer and look out now for a real cool spell. Markets are climatic and can even get climactic. Gaianomics is real. Next time we can discuss Guyanomics: How guys spend.
Well, it is Friday and it's time to head for the "Country" to get down with the real Minyans!
Under the Hood - Kevin Depew - 11:53 AM
- New PnF buy signals leading new sell signals in the early going 11 to 8, despite the dark red bleeding on the screen.
- Overall buy signals leading 19 to 10.
- This continues to add net new buy signals to the bullish percent indicators, suggesting an underlying bid to the tape.
- In other news, Silver has hit the 14 target level. I'm out.
- Thomson has added some increased fire power to their DeMark scans now, with the ability to scan for stocks hitting 11s and 12s in potential 13 buy/sell signals.
Trend Line in 10's is Toast - Bennet Sedacca - 10:35 AM
See it here. If we close like this, the target is eventually 114 then 120.
The mortgage convexity trade may be on as Minyan Steve pointed out to me.
I am selling preferreds into the rally, but that is more of a function of my thought that spreads will widen out.
My call for 2007 Fed eases is shaping up just fine...
What you need to know... - Jon Doctor J Najarian - 9:03 AM
Kirk Kerkorian Dumps General Motors (GM) – A host of reports this morning say he's out, fini, gone and our Depth Charge showed the alleged sale to Bank of America (BAC) of some 28 million shares that ended Mr. Kerkorian's relationship with the world's largest automaker.
LBO's Not PMI Dominate Markets – The Chicago PMI was only a hot topic for the first hour and a half of trading yesterday, as LBO chatter took center stage for the final hours of trade. Thanks to Doris Frankel of Reuters, who cited my firm and our work on USG & Titanium Metals (TIE) in her article; "Possible Takeover Stocks Lure Investors."
KKR & Texas Pacific Eyeing Home Depot (HD)? Yup, add HD to the mix, but this time it's not Eddie Lampert, its Kohlberg Kravis & Roberts and Texas Pacific that the WSJ reports are studying launching a possible $100 billion buyout of Home Depot.
Advanced Micro Devices (AMD) Receives Subpoena in Graphics Chip Investigation - The world's No. 2 maker of the microprocessors that act as the core calculating engines of computers, entered the graphics chip market earlier this year when they bought ATI Technologies Inc for $5.4 billion.
Position in HD
The H boys... - John Succo - 8:59 AM
Home Depot (HD) is up over a dollar pre-open on LBO rumors. My firm's thoughts are that an LBO for HD (or any retailer) makes little financial sense. Most of these rumored and actual transactions these days are making little sense, but companies like this it is especially the case. The only positive factor going for such a deal is that HD has virtually no debt. But it has little in the way of hard assets and thin margins, which makes an LBO very dangerous.
But crazier things have happened. After all that de-levering by companies in 2002 they are now all in a rush to re-lever. Lessons not learned.
If the US's new Treasury secretary wants to worry about financial melt-downs as a function of risk taking by hedge funds, he needs to call up Mr. Bernanke and talk about the real source of risk: super easy money finding its way into pure speculation. Today's LBO funds are a form of hyper-speculation as they are forcing too much risk into the system.
H&R Block (HRB) reported EPS showing how its business is truly deteriorating. With losses higher than expected and competition destroying their tax business, the only thing driving the stock up is the fact that "it wants to sell its mortgage business." The catch-22 is that this is the only business the company can pretend (it is showing earnings at the same time the assets of the portfolio are deteriorating in value) to make money.
There is one large buyer of stock (hedge fund) pushing the stock price up and management to "restructure." The problem is there is no solution and the company is running out of time.
Position in HD, HRB
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