Stock Market

[KennyTheKangaroo]

Translation: WVU sucks

[ExPatriatePen]

Translation: WVU sucks

Why does everything always come back to that refrain with some people?

Reminds me of a grade school playground...

[count2infinity]

Translation: WVU sucks

Why does everything always come back to that refrain with some people?

Reminds me of a grade school playground...

same reason that when you talk to non-penguins fans it always comes back to "Crosby sucks!" There's no talking to those types of people.

[KennyTheKangaroo]

Translation: WVU sucks

Why does everything always come back to that refrain with some people?

Reminds me of a grade school playground...

kenny the kangaroo tries to keep it as high brow as possible

[count2infinity]

btw... in no way am i saying Crosby = WVU

[JeffDFD]

a whole lot of suck coming out of the market recently

[columbia]

a whole lot of suck coming out of the market recently

Yes. :(

[Streaks House]

JP Morgan. Man.

[JeffDFD]

JP Morgan. Man.

5 days = down 14%.

[mac5155]

Am I supposed to feel sorry for them..?

[ExPatriatePen]

Down big today. Wonder how the week will go. Buying opportunity? Anybody looking at anything specific?

You'll get a chance to buy lower (at least the averages)

I wouldn't pull the trigger here.

Almost one month since I wrote this, my least favorite sector, financials are way off from where they were on April 23rd.

Still think we see softness through the early summer. I don't like the market here at all. Especially with my earlier prediction of Greece leaving the Euro looking more and more like its going to happen.

[KennyTheKangaroo]

too much grandstanding over this jp morgan thing.

[ExPatriatePen]

too much grandstanding over this jp morgan thing.

Tactically, yes. Strategically, not so much.

JPM Chase as a bank will be better for it (in a years time). It'll force even more internal controls to what is already the best risk management in the financial sector. I'm sure JPM isn't the only one doing these CDS trades (which in this case was weird, loans to Europe, CDS sales to hedge, other CDS trades to take that hedge off - which brings up an interesting question, what *do* you call a hedge of a hedge?)

The bigger question coming from this is a regulatory question, more or less? (my opinion is to break up investment banking from FDIC insured deposits - Glass Steagall anyone?) don't you just love Obama jumping in to use this as a case for more government involvement?

Anyway, I'm actually tempted to buy some JPM here.

[KennyTheKangaroo]

(which in this case was weird, loans to Europe, CDS sales to hedge, other CDS trades to take that hedge off - which brings up an interesting question, what *do* you call a hedge of a hedge?)

The bigger question coming from this is a regulatory question, more or less? (my opinion is to break up investment banking from FDIC insured deposits - Glass Steagall anyone?) don't you just love Obama jumping in to use this as a case for more government involvement?

Anyway, I'm actually tempted to buy some JPM here.

The answer to the question of what do you call a hedge of a hedge is probably "Wall street shenanigans." The better question is, what DO you call the mere concept of buying insurance on an imaginary index of euopean corporate debt ? Thats also shenanigans, too.

But the grandstanding that is annoying kenny the kangaroo is the politcal grandstanding over this whole thing. Fannie mae and freedic mac have lost hundreds of billions of dollars in the past few years. Why doesnt commander in chief barak obama climb atop hsi ivory tower and whine about that?

also

What are your thoughts on natural gas producers (other than chesapeake) as a long term buy and hold?

[ExPatriatePen]

What are your thoughts on natural gas producers (other than chesapeake) as a long term buy and hold?

So, the folks over in the Political Thread will tell you I'm an unabashed proponent of natural gas.

I have been for three or four years now, and have lost quite a bit of money on drillers, support services, mid stream operations MLP's and other Natty Gas plays.

I'm constantly amazed that the commodity itself seems to know no bottom, the Obama administration, who loves stimulus of just about anything, refuses to encourage domestic resources, and in spite of gas approaching $5 a gallon, the free market isn't converting wholesale to Natty Gas as a transportation fuel.

Bottom line, my favorite plays are risky, but they include:

FSYS - Fuel systems
NRGY - Mid stream (storage operations)
CBI - Gas infrastructure building

I'm not fond of any drillers/production companies here.

I think we're probably still 3-4 years out from Gas commodity price appreciation. But I still like the long term trend.

(late edit to correct some spelling errors and typo's that were bugging me)

[KennyTheKangaroo]

that is very good insight there EPP, thanks.

a few things:

A.) Will Obama ever accuse "speculators" of holding natural gas prices low, just like he accuses "speculators" of inflating the price of oil?

B.) One of the natural gas stocks kenny the kangaroo had in mind was Encana (ECA). they kind of fit kenny the kangaroo's style, but they are also a producer.

C.) Kenny the kangaroo might just take the easy way out and buy an natural gas etf like FCG (not UNG or GAZ or any of those)

[Firebird]

Starting to seem as if this tailspin will never end.

[Tomas]

So who is ready to invest in FB @$38?

Here is an eclectic list of valuation articles (I myself am quite a strong believer of at least ex-post backing the valuation estimate with a DCF analysis) all suggesting that price is crazy (I just finished teaching a corporate valuation course, and this was the content of my last course email. What's interesting is that the "market" thinks the stock will close even HIGHER (over 50% chance at $45+ http://www.intrade.com/v4/markets/?eventId=91681 )):

Here is an interesting article on Facebook estimated DCF value. Note that similarly to our Netscape valuation (which utilized "pure play growth" estimates based on Microsoft), Facebook value is also based on the growth rates achieved by its arguable pure play - Google.

http://wallstreetpit.com/91904-facebook ... -ipo-range

Even more interestingly, here is the actual DFC calculator Thomson Reuters used to estimate Facebook value:

http://link.reuters.com/peb28s

(If you click "View full calculator" - you'll actually get the complete Excel spreadsheet with the valuation).

Yet another DCF calculator (Financial Times):

http://www.ft.com/intl/cms/s/2/8a21debe ... z1uUTzJxSU

Here are some arguments based on the valuation using multiples:

http://seekingalpha.com/article/567771- ... ook-shares

And a little unorthodox approach based on direct comparisons with pure plays:

http://www.huffingtonpost.com/eric-k-cl ... 76402.html

[Tomas]

FB opening was delayed by ~30 minutes - apparently due to the avalanche of last minute sell orders. The stock opened at $42.05 (the expectations were first at ~$50, then lowered down to $45, then lowered further down), shot up very briefly to $43, but after less than 10 minutes it's below $40...

[Tomas]

Now I guess only limit orders (and underwriter support?) keep FB from falling below the IPO subscription price of $38.

[Tomas]

Fun with numbers:
http://www.cnbc.com/id/47388424

CNBC also reported that U2's Bono (a partner in Elevation Partners in the above list) will make more money from his Facebook investment than all the profits he made through his music in his lifetime...

[steelhammer]

Appreciate your take on this as always, Tomas. Forgive my limited knowledge of the financial sector, but this just seems like such a scam.

[ExPatriatePen]

Tomas, you don't post near often enough in this thread. If you ever come to NYC ( or I ever get down to Razorback country ) I would love to buy you a beer!

[AlexPKeaton]

Shaky IPO day for Facebook I would think if they have to resort to their underwriters to keep the stock up.

[columbia]

As I heard on the radio...

Zuckerberg is now worth as much as the endowment of Harvard.