Alex Filonov

http://muddlinginvestor.blogspot.com/
Total Rating:
+13 / -5

282 Comments

    • Sat Nov 22nd 00:57 AM | Rating: 0 0
      Commented on:
      Buffett's Gamble: $40 Billion Bet on Volatility
      Looks like either we have depression priced into the market or it's hedge funds gone wild and selling everything they can. I'd love it to be the latter, but I'm afraid of the former.

      Berkshire can get severely kicked by those put options even without decade long depression. Five years might be enough, after that stocks would take another 5 years to recover, at least. Great Depression officially ended up in 1942, but stocks didn't return to 1929 high until 1954.
      View article »
    • Fri Nov 21st 13:11 PM | Rating: 0 0
      Commented on:
      China: The One Global Market with Gains Behind the Gloom
      Yeah, great! Wonderful! Now if only any statistics supplied by communists had any relation to the real life... Right now companies in several Chinese provinces can't lay off workers without government permission. How's that for the feel of great optimism? And I'd like to know how export oriented economy can feel good in global recession?
      View article »
    • Wed Nov 19th 13:30 PM | Rating: +1 0
      Commented on:
      Shorting Russia Via Ruble ETF Trade
      Let's wait till this ETF is liquid enough. Today's volume is 100 shares so far, it's impossible to trade.
      View article »
    • Wed Nov 19th 10:08 AM | Rating: 0 0
      Commented on:
      7 Key Points About Deflation
      Asset bubbles happened in times of "real" money as well. Just remember the tulips!
      To get 1970s wage-driven inflation, you need strong unions. Here, in US, I don't see any.
      View article »
    • Tue Nov 18th 22:30 PM | Rating: 0 0
      Commented on:
      Yes, Fund Managers Really Do Underperform
      Fund managers have no incentive to perform. They take fee as a percentage of managed money. Fund performance doesn't matter, and sometimes the kill it using "window dressing", just to show the latest "performing" asset in the portfolio by the end of quarter. I bet lots of fund will show maximum cash allowed in their portfolios in the end of this quarter.
      View article »
    • Tue Nov 18th 12:25 PM | Rating: 0 0
      Commented on:
      D-Day: Does Deflation Draw Near?
      Small correction: Fed's target rate is 1%. Fed's funds rate is under 0.4% now (yesterday's 0.37%, data of NY Fed, available here: www.newyorkfed.org/mar...).
      View article »
    • Mon Nov 17th 16:35 PM | Rating: 0 0
      Commented on:
      GM: An Alternative to Bankruptcy
      Government probably will have to assume pension obligations. Here's the rub: in case of Chapter 11 company can cancel pension plan and government pension fund accepts part of pension obligations. Hard on people, they lose about 50% of their pensions, but reasonable for the government. In proposed scenario, bankruptcy law doesn't apply, so how pension obligations are treated? I don't think gov can (and should) assume pension obligations at 100%. BTW, GM (and Ford, and Chrysler) pension fund is underfunded by billions of dollars.
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    • Mon Nov 17th 12:12 PM | Rating: +1 0
      Commented on:
      The Humility of Realism
      As matematicians know, one false assumption negates the proof. Or, as Gilbert used to say, if I assume that 2x2=5, I can prove that Moon is made of blue cheese. Great Depression happened in times of gold based money. Which tells me that credit boom (and bust) can (and did) happen in times of "real", i.e. precious metal based money as well. Has nothing to do with fiat money. Has everything to do with human psychology.
      View article »
    • Mon Nov 17th 10:14 AM | Rating: +1 0
      Commented on:
      Four Ways to Invest in Bottom-Basement Gold
      >The U.S. Department of Agriculture’s Oct. 10 Crop Production Report said acreage >for a handful of staple food commodities has shrunk:

      > * Corn acreage fell 1.2%.
      > * Soybean acreage dropped 1.4%.
      > * Canola acreage dropped 1.9%.
      > * Sunflower acreage shrank 0.8%.
      > * And acreage of dry edible beans fell 0.7%.

      >That naturally translates to higher prices because it squeezes the supply of the
      > particular commodity.

      Nope. You forget about demand part of the market. Prices fell because demand fell. If demand to fall more, reduced supply wouldn't raise prices.
      View article »
    • Mon Nov 17th 09:51 AM | Rating: +1 0
      Commented on:
      GM Must Die
      About pension liabilities. According to current laws, government accepts part of pension liability when company files for bankruptcy. More about it here: www.cga.ct.gov/2002/ol.... So whether we want it or not, pensions are protected in bankruptcy.
      View article »
    • Fri Nov 14th 16:08 PM | Rating: +2 -2
      Commented on:
      Is Buy-and-Hold Dead? Hardly
      Just take a look at Dow chart since 1920s. Index has a defined cycle, with period of about 35 years. There is a bull market leg and sideways leg in each cycle. You can be great buy and hold investor in the bull market period (latest was between 1982 and 2000). In sideways market, buy and hold is worse than keeping money on CD. That's where we are fight now. Of course, if you can find great companies with good growth, you still can make money buy buying young company and selling when it reaches maturity or acquired, but that's not a traditional buy and hold strategy.

      Or, like somebody said, don't confuse bull market with genius.
      View article »
    • Fri Nov 14th 15:51 PM | Rating: +3 0
      Commented on:
      The Right Kind of Bailout
      There are no good options here, the choice is between bad and worse. Which is compounded by the main problem at GM and Ford: they didn't make money on vehicles even in good times. Main source of profit was in financing, GM and Ford were making money like banks. Now, when banks lose money, Detroit is doomed. I don't know situation at Chrysler, but GM and Ford don't have anything to survive in their current shape. No bailout would help. Bankruptcy might, especially if it frees companies of their union contracts and pension obligations. BTW, bankruptcy will trigger automatic rescue from government, because gov will have to take over pension obligations. But even then, both companies have to go through drastic restructuring, closing at least 50% factories each, streamlining development, retooling and doing a lot of things which require a lot of money (and the source of this money?...)

      Nationalization, proposed by some, is not a cure, it's a funeral. The only examples I know are Britain and France. There is almost no auto industry in Britain anymore. In France, Renault cost taxpayers huge money until it was finally privatized. If we don't want national automakers in this country, then let's nationalize them. But I'm afraid it's cheaper to close them outright and just pay pension to all workers.
      View article »
    • Fri Nov 14th 14:05 PM | Rating: 0 0
      Commented on:
      Beyond the Crisis: A World Made of BRICs
      'China will get out almost unaffected by the crisis'

      That's interesting. Major export oriented economy in the environment of global slowdown and deflation, unaffected? That's against all economic laws and common sense.
      View article »
    • Thu Nov 13th 17:02 PM | Rating: 0 0
      Commented on:
      When the Going Gets Tough, the Tough Play Defense
      I thought that defense is cash and high-yield stocks...
      View article »
    • Wed Nov 12th 17:47 PM | Rating: 0 0
      Commented on:
      A Radical Solution for U.S. Automakers
      Alt energy is not going to work in transportation. There is none available right now which can compete with oil derivatives on price and convenience. Even at $100 oil. For a little bit of analysis look here:
      muddlinginvestor.blogs...

      Any project like proposed would be another case of government waste. Governments of the world already spent hundreds of billions of dollars on alt energy and it's mostly waste. You are just proposing to waste several trillions more.
      View article »
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