Question: I can’t remember the last time I lost this much in one day except the day the market opened after 9-11. And I thought I was diversified.
Answer: I’ve had a couple of “virtual” portfolios of shorted stocks, defined by screening criteria, since early May.
The best performing screen, in that short time period, has been: debt-equity ratio over 5, p/b over 3, p/cf over 20.
The worst screen, in that short time period, has been p/eg over 3, p/b over 3, p/s over 4, p/cf over 20.
Right now, I am short CNT, PVR, NXST, and SONO. I am somewhat intringued by EDLG, which reports a debt-to-equity ratio of 1885, a p/b of over 100, and a p/cf also over 100. Granted, student loans seem like a great business, but those numbers are pretty eye-popping.
Question: My neighbor is a public elementary school teacher. She goes to work at 7AM, gets home at 5:30PM, spends THREE HOURS every week night on grading, and spends EIGHT+ MORE HOURS on preparation on weekends.
That’s 52.5 + 15 + 8 = 75.5 hours a week. Take off 10 hours for travel time and it STILL is plenty of work.
I’ll grant you she gets 2 months off in the summer.
Answer: And what is your point? My instructor in on campus doing research, teaching, helping students, etc, all day as well. He usually gets to his office at 8:00 am and doesn’t go home until 6 or 7 PM. And on Tuesdays and Thursdays he teaches until 7:45 PM, so he doesn’t leave until 8:00 PM. I have seen him in his office on weekends and over breaks. He works in the Summer, doing research and supervised me on a research project over the summer, but he didn’tget paid anything extra for it. Professors work hard, too. WAY too many college graduates already in American workforce – to the point that grossly-underemployed ones abound and your next dinner may well be served by a college graduate waitress. WAY too many downsized college graduates essentially never to work again – like my neighbor, one of many downsized by Lucent in this county. America needs fewer college graduates – not more.
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Question: I never paid much attention to it, but PSFT jumped into my awareness recently, I don’t know why, and I must admit I was amused by its 3 year chart.
What does PSFT do?
Why did it go up so high?
Is there any reason to think it has stopped going down?
Answer: They make software that helps in all facets of businesses and universities to manage money and people. The university where I work is installing PSFT for salaries, student loans, purchasing, etc. I believe they are approaching a minimum. They may have a couple more points on the downside. I’m watching them. I figure a few more points and there is little downside risk.
My usual caveat applies, I know nothing and see nothing. They were over-hyped and over-valued in an already over-hyped and over-valued sector (ERP – entrprise resource planning software).
Compare to Sybase circa 1993/94.
Question: And make college FREE to anyone maintaining a B or higher average.
Why should education K thru 12 be free, and a College degree cost $50K to $200K? Makes no sense to me. Here are NEEDED education reforms:
1. Go back to the days where high schools prepared SOME students for blue collar and service jobs. Starting in junior year of high school, there should be JOB TRAINING courses for those who elect.
2. Have more 1-year and 2-year community college associate degrees.
3. Pay college professors by semester-hours actually taught. About $2500 per semester hour seems right ($100K /yr for a full 20 teaching in-class hours per week work load, with 20 office hours per week).
4. Get rid of all the bullshit “research” and “paid sabbaticals” at universities. Colleges are for EDUCATION, not for profs to fuck off.
5. Pay college presidents a high school principal’s pay. $100K / year.
6. Cut football scholarships to 25, and pay the coaches $100K max.
Colleges now are wasting the money of the American people.
Answer: a) The monies paid by the sub-B average students, and FEDERAL subsidies, pay for maintenance. Resident students pay room and board.
b) The average College professor teaches FIVE hours per week. The biggest cost of a College education is faculty. By making the lazy bastards TEACH something close to a full load, and stop fucking around with research and paid sabbaticals, costs could be HALVED.
c) MOST big-time College football programs these days are money LOSERS. A class is 2.5 hours per week. Teaching universities have their instructors teach 5 classes a week, which is 12.5 hours per week in the classroom. Research universities have instructors do 2 classes, which is 5 hours per week. But that is just in the classroom. I am a TA for a teacher at my university and my teacher puts another 10-15 hours into creating the class (making up the lectures, making sure the lectures are up-to-date, making up exams, homework, etc). And I don’t see why you have a problem with research or sabbaticals. Research advances knowledge and supports graduate students. Sabbaticals are a chance for professors to learn about their area outside of the university. My professor went to Greece and Africa to study his area in other countries. He then came back and taught that information to us.
Question: Euro and Yen futures gaining again.
>>>>>>Comments?
>>>>>Yeah GOLD! GOLD! GOLD!
>>>>Gold will not reach $3000 like some say. >>>>I predict $1800.
>>>>Hope this helps
>>>Heck I’d be happy with $400 but intend to stay long
>>>if it actually gets there because that would indicate >>>a major, major change in the gold valuation and great >>>for future expectations.
> Valuing your gold against paper currency is pointless.
> If, someday, gold is USD$40000/oz, would you sell? If you don’t want > depreciating fiat USD now, why would you then?
> Gold can only be reasonably priced against other tangible goods – > barrels of oil, silver, a nice suit, wheat, whatever.
> Gold value only changes as a result of supply and demand fundamentals.
> Paper money value instead changes to approach its real value, zero.
The idea is to get lots of fiat USD using gold as a vehicle then convert to tangibles like house, car, and perishables like.. uh.. food for the next 10 years (freeze dried bulk purchase). With a house paid off still the taxes. I only work at a “job” to get enough fiat USD to retire from “job” and then do things I like to do. (My list of things I like to do was made about 30 years ago and I’m still trying to get the damn USD)’ Unlike government I can’t just print it I have to work for a living. So I hope gold goes up.
Answer: Okay, I can agree with that. It’s just my expectation that if things get to the point we both seem to expect, where gold goes parabolic, it would just about have to be a German-style problem where USD$40,000 might buy you a suit in the morning, and a cup of coffee in the evening.
That is to say, by the time our gold goes up enough to convert to tons of USD, it’ll be too late to stock up on all those things.
So instead I’m just stocking up now, socking away more gold when I can, expecting to use it as a fallback if/when I’m laid off, quit, or TSHTF.
I don’t see a world with gold that high and everything else remaining equal. Yes. All I’m missing now is the house (got the car paid off). Everybody keeps slaving for these bits of green confetti because they have $8000 in credit card debt, $20k in student loans, and a mortgage. If they don’t keep spinning their wheels and passing the USD to their owners they’ll be left out on the streets, bankrupt.
All the while, the feds keep printing that confetti out of ABSOLUTELY NOTHING.
I figure with what I have put away in non-USD assets, I could make it a year or so maintaining my current level of consumption, even continue to piss away money on rent. This is the secure feeling gold and silver give me, which are why I buy them. Because they’ll be there for later.
I might trade a bit in and out to scrape up more fiat to buy more physical, but yeah. A healthy outlook. The only reason, in my book, to keep playing their game, is to get what you want out of it so that you can do the things you like to do. Not just to maintain conspicuous consumption and keep up with the Joneses working 70hr weeks to pay the lease on the Jaguar.
Question: I am a first time investor with about 1000 to invest. What stocks do you think are currently good ones? Some that I have been looking at are PSIX, MRG, and CA.
Any comments would be very much appreciated
Answer: From your email I gather you are still in college. Congrats on getting started early, and realizing that this is a good time to invest. I put student loans in CD’s back in my college days, but you can do nicely in the market these days, if you are willing to take some risk. I don’t suggest you handle your own investing, stock by stock. There are lots of good mutual funds out there.
If you are willing to gamble your future away, you can buy AOL, or MSFT or whatever and feel like you made a sound investment. This is where the whole diversity thing comes into play. You are not going to be able to watch what stocks you are in through you should make al ist of industries you think will do well, and try to put aside some money each week to buy stocks. If you watch the market, you’ll have a better idea of what stocks to buy as well. Try and pick a new stock each week. The best investments come from the heart. Don’t expect any of those to explode next week. Don’t buy UBID. Don’t buy EBAY. Don’t buy EGGS. Those stocks are better left to people that can trade them by the minute, and are willing to lose big each day.
Want the next big mover internet stock?
Question: I look at the market and that’s what I see. A reasonably-priced stock with a dividend is one thing.
With the valuations today it’s just a huge pyramid scheme in my opinion.
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Answer: Me too, then I hear kids in campus during lunch hours bragging to each other how much they made on YHOO, CMGI and RHAT (yes, they say Y.H.O.O. and R.H.A.T. the stock symbol) on their student loan, I realize…. fuck them. They’re only people, and we have lots of those around..
When I went to school, people wasted their student loans on buying an Acura Intergra with tinted windows. I heard (read in history books) that the generation before me (the ones who gets loans) waste their money on alcohol… I hope the door is big enough..
BTW, as an aside, what caused the last few BIG crash? I don’t mean the ones like last year (really just a small correction?), I mean ones where it just drops/side ways for over a year) Economic downturn? In fact that is the easiest way to make money in the stock market. You and I get together. I buy your 1000 shares of stock for $15, $5 over your cost. Then you buy it off me for $20. Voila, we both just made $5,000.
It’s easy. Stop the bitchin’ With all of the IPOs coming up, the number of shares on the market is escalating at an alarming rate, in my opinion.
Due to the increase in supply of shares, the amount of money invested needs to increase just to keep prices at stable levels. If the amount of money pouring into the market ever levels off, prices will fall precipitously. (I’m not saying this will happen, but it remains a possibility.) I am only referring to sectors with lots of IPOs, such as electronics, internet, and software firms.
Currently, I am investing in sectors that do not have a lot of IPOs.
Question: Recently insiders at ADOBE sold about 1.4 million shares of stock. Look out below. Adobe isn’t a bargain. It has no support levels between 54 and about 35. Insiders in the company sold off 1.4 million shares in the last six months. If its so good to own why are 6 insiders running the other way ?
Answer: I don’t much much about stock; I’m here to learn 
But I do know a bit about software, so here’s my two cents worth.
Adobe’s main competitor is Quark Express. And Quark is a great product, up to a point. Every user I know gripes about Quark’s lack of support and Quark’s Antoinette attitude. I think that version 7.0 will really give Quark a run for it’s money. And there’s Framemaker. Quark is also really optimized for short documents; there’s a real opening for a layout program designed to do books. And don’t forget Illustrator and Photoshop. Photoshop just keeps improving; it really is the killer app for digital imaging, with almost no competition. It’s powerful, and it keeps getting easier to loose. Also, Adobe is truly preparing for a future that includes both paper and on-line publication of various sorts. They are thinking and researching the way users work.
This may seem silly, but I’ve met a number of the supprt and engineering staff at Adobe; it really is an incredibly tight, surprisingly small company. And the employees raved about management. Programmers just don’t do that, as a rule.
I’d like to buy Adobe; now if I can just pay off my student loans and find a broker… No, I don’t use chat rooms for trading. From what I understand, some are better than others, kind of like neighborhoods 
Most day traders don’t know much about the stocks they are trading in, but I do my research VERY carefully, and don’t trade companies I know nothing about, and whose valuation is out of wack (like the Internet companies…yeah, a lot of people have made a LOT of money, but it’s still bullshit).
That way my short trades aren’t bad medium/long trades, and I am currently in two long trades that stemmed from bad (slow) exit strategy, that I have no fear of being long on. I keep half my portfolio medium and the other half cash, for ‘day’ trading.
I still have the typical sellers remorse…where I day trade a stock and made plenty on it, and it went up significantly (SILK is my most recent….I bought it at $23, set it to automatically sell it at $27 because I was away that afternoon…and it went up way into the 40’s! At 1000 shares, that’s a LOT of dough I lost by being on autopilot…BUT I did make plenty….).
I also have “didn’t sell” remorse….like DELL…and one big problem I have is trade execution….I just can’t get my trades to execute fast enough…even though the stock is at my sell price, my trades don’t end up selling. I am researching how to minimize that…and most good day traders, from what I understand, sell at the bid price, just because they know it will execute FASTer, but in a few cases, I didn’t do that, and took a hit.
I look for cyclic stocks…like DELL…chart it out since the split, and you will see what I mean…. I spend hours a day (and night) just looking for stocks to analyze….that’s most of the work, finding good stocks.
A company like MYLX has been really undervalued for SO long, and there is a hint of some upward movement soon, but I feel ’stuck’ in it….I know it’s going to go up, but sometimes I loose my patience, and want to just take my %20 and move on. MYLX is one of my long term stocks, that I bought perfectly at the bottom, and I feel it’s a REAL good one.
It’s a blessing and a curse that I know what the companies do, cause I know if the ‘technology’ is bullshit (eBay), and I end up not investing in companies that end up in these ‘emotional’ roller coasters, that have bee doing so well over the past 6 months. As I said, that’s both good and bad… I believe in the long run, it’s good…but %5000 would have been nice
Question: I am new to this and need some help. My husband and I together make about $50k annually. We have a couple of kids. We need to start saving for our retirement and for the future education of our children. We do not have a retirement fund at work. Any ideas?
Answer: A roth IRA with Vanguard may be a good way for you to begin. The Roth provides tax-free returns, using income that’s already been taxed. Vanguard has a wide array of mutual funds which all feature low expenses, thus maximizing your returns. You can also have a brokerage account with them if you wish to trade individual stocks.
Re: saving for children’s education, keep that portion in your/your husband’s names. This avoids problems later if your kids take advantage of grants or student loans.
These are my opinions, you should speak to a professional before you begin investing. Also, do some reading if you envision stock trading in the future. You hear about the success stories, but a lot of people get hurt investing w/out knowledge
Question: further than it already has. I have some cash sitting on the sidlines, and I have been saddened by its loss in value over the last year or so.
What can I do to preserve capital without going into the American stock or real estate markets (a fine house of cards they appear to be)?
I have bought some gold coins, but the added costs, over and above the price of gold, make them unattractive. With all costs involved, dealers quote Philharmonics at prices of $35 above the spot price of gold itself.
I would appreciate realistic suggestions.
Answer: Better check an American English dictionary before attempting to define words like Capital used in the financial sense of the word.
“Wealth in the form of money or property owned by a person or business and human resources of economic value”
Money is most definitely created. It is created by commercial banks.
Yes, I know you are just a miseducated victim of the k12 school system. Gold will perform inversely with the U.S. Dollar. Because Gold, the metal, is priced throughout the world in U. S. Dollars, it responds in kind to dollar devaluation with increases in price. See this ratio chart:
http://stockcharts.com/def/servlet/SC.web?c=$usd:$gold,uu[h,a]macaniay[pb50!b200!f][vc60][i]&pref=G
Gold mining stocks are very volatile because the U.S. Reserve Banks are short Gold, but longer term they will not be able to hold the price down.
There is a new closed-end gold fund, symbol GLD that tracks the metal price, and some good gold mining stocks to trade: ASA, AU, BGO, CDE, CBJ, FCX, GG, GLG, GFI, HMY, KGC MDG, NG, SSRI (silver), WHT. CHOOSE CAREFULLY!
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