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Assorted Trade Basket: Sirius, XM, Whole Foods, Nymex...


Some food for thought, including the similarity between the Sirius/XM and Whole Foods/Wild Oats mergers.

  • For those who have been watching paint dry all summer waiting for the FCC decision on the XM Satellite (XMSR) / Sirius (SIRI) merger, here are a couple of nuggets to chew on.

    I was discussing the merger with a good friend of mine who happens to be a very sharp antitrust telecom attorney and he too compared XMSR/SIRI to the Whole Foods (WFMI) / Wild Oats merger. In the latter the FTC's argument that the pertinent market space was that of "organic food stores" was shot down in flames by the District Court. That of course should make sense to all bipedal mammals on the planet, unless of course they are employed by the FTC. The idea that the music/news/entertainment delivery market pertinent to XMSR/SIRI is only that of satellite radio, is similarly ludicrous, unless one has an allergy to CDs, AM/FM radio, DVDs, MP3 players, or HD radios. Let's hope the FCC does not choose to embarrass itself like the FTC.

  • Speaking of my long lost friend Whole Foods, I have taken the opportunity of the recent price rise to re-enter the dark side. My long standing thesis on this name remains unchanged. (search also the Buzz for more if interested).

  • I have been on the fence over Nymex (NMX) for a long time. No secret that I've been liking that space for a while, but often not the valuation. Hence my long standing longs in TSX Group (X CN), FCStone (FCSX) and more recently NYSE Euronext (NYX). I circled back to NMX last night and bought in this morning. Truth be told, little had changed in the fundies and the nudge came from some of the Profs on the Fast Money program.

  • Sprint-Nextel (S) and Clearwire (CLWR) are about to unveil their Wi-Max product called Xohm. One of the first markets will be the Washington DC / Baltimore area, and more than a few of my techie friends seem quite excited about it. Since I have no desire to get involved with Sprint-Nextel or Clearwire (I have lost enough money with Craig McCaw to last me a lifetime), I return to my view that this is just another example of a new technology that will stress already crowded metro-networks, and that reinforces my Hoof-ishness for the Ciena (CIEN), Infinera (INFN), and F5 Networks (FFIV) of the world. I was gonna throw Akamai (AKAM) in there too, but first I have to put my paper bag of shame over my head.

  • Lastly, continue to watch the dollar carefully, as the drop-and-pop scenario looks may be sucking wind. If it cannot muster a comeback by the end of next week, keep you ears open for cries of "dollar crisis".
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Positions in XM, SIRI, WFMI, CIEN, INFN, FFIV, AKAM, EUR/USD futures, NMX, NYX, X Cn, FCSX.
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