Looks Tempting
Posted by Eddy Elfenbein on October 2nd, 2008 at 9:46 am

I have to admit that shares of Apple (AAPL) are starting to look attractive. The stock has come down a lot, but this is still an incredibly strong business. I think investors are getting understandably nervous about this holiday season.
The company said to expect Q4 earnings (ending September 30) of $1 a share. However, the company always low-balls its forecasts so it can say that it beat forecasts. My quick guess is that Apple will probably report about $1.15 to $1.20 a share.
The concern is that Apple will come out with a lousy forecast for 2009, and the market will think that it’s not low-balling. Even if the company only grows its earnings-per-share by a little bit, the current price won’t be a bad entry price. I wouldn’t bite just yet, but an $80 share price would be hard to ignore.

Yahoo at New 52-Week Low
Posted by Eddy Elfenbein on October 2nd, 2008 at 9:31 am

For a long time now, I’ve been criticizing Yahoo’s (YHOO) share price. I just couldn’t see how or why the stock was going for $31 a share. I said on several occasions that I wouldn’t pay half that much. Now the stock is finally close to half that level, and I’m still not buying.

Senate Says Yep
Posted by Eddy Elfenbein on October 1st, 2008 at 10:43 pm

The Senate passed the bailout bill by a vote of 74-25. Here’s the roll call.
For now, I’m long wooden arrows.

Third-Quarter Update
Posted by Eddy Elfenbein on October 1st, 2008 at 7:39 pm

Now that the third quarter is over with, I wanted to pass along some thoughts about changes to my Buy List. I make changes once a year in mid-December, and start tracking the new list on January 1. Right now, I’m considering cutting a few stocks. I don’t know yet, but these are on my short list:
Clarcor (CLC)
Harley-Davidson (HOG)
Lincare (LNCR)
SEI Investments (SEIC)
WR Berkley (WRB)
Unitedhealth (UNH)

The Fine Print
Posted by Eddy Elfenbein on October 1st, 2008 at 4:25 pm

From The Onion:

HR 1424
Posted by Eddy Elfenbein on October 1st, 2008 at 12:17 pm

Here’s the Senate’s bill. It checks in at 451 pages.
If you turn to page 299, you’ll find:

20 SEC. 503. EXEMPTION FROM EXCISE TAX FOR CERTAIN
21 WOODEN ARROWS DESIGNED FOR USE BY
22 CHILDREN.
23 (a) IN GENERAL.—Paragraph (2) of section 4161(b)
24 is amended by redesignating subparagraph (B) as sub
1 paragraph (C) and by inserting after subparagraph (A)
2 the following new subparagraph:
3 ‘‘(B) EXEMPTION FOR CERTAIN WOODEN
4 ARROW SHAFTS.—Subparagraph (A) shall not
5 apply to any shaft consisting of all natural
6 wood with no laminations or artificial means of
7 enhancing the spine of such shaft (whether sold
8 separately or incorporated as part of a finished
9 or unfinished product) of a type used in the
10 manufacture of any arrow which after its as
11 sembly—
12 ‘‘(i) measures 5⁄16 of an inch or less in
13 diameter, and
14 ‘‘(ii) is not suitable for use with a bow
15 described in paragraph (1)(A).’’.
16 (b) EFFECTIVE DATE.—The amendments made by
17 this section shall apply to shafts first sold after the date
18 of enactment of this Act.

Here We Go Again
Posted by Eddy Elfenbein on October 1st, 2008 at 1:39 am

The Senate will vote later today on a revised bailout plan.

Senate Majority Leader Harry M. Reid (D-Nev.) called the Senate’s revised legislation “the best thing to move forward.” Reid was joined on the floor by Senate Minority Leader Mitch McConnell (R-Ky.), who said the plan was “one of the finer moments in the Senate.”
A senior House Republican adviser, who spoke on the condition of anonymity to talk about private strategy, said the addition of the FDIC cap increase and the tax credits — without any corresponding tax increases — could have “substantial appeal” in that caucus. Boehner was consulted by Senate leaders and gave his approval, the aide said.
But the addition of the tax provisions may entail new risks in the House, which returns to action Thursday. Speaker Nancy Pelosi (D-Calif.) responded tepidly to the Senate announcement, and it remained unclear when the House would would consider the revised bill, though a vote is likely by week’s end. “The Senate has made a decision about how to proceed and what can pass that body. The Senate will vote . . . and the Congress will work its will,” Pelosi said.

I’m honestly a little confused. I believe the Constitution requires all money bills to start in the House. Perhaps this Senate vote would be to test the waters, then it would go to the House and back to Senate.

The FDIC provision, which would raise the insurance cap for bank accounts to $250,000 from the current $100,000, was discussed during weekend negotiations in Pelosi’s office but was not included in the final package. But in what negotiators from both parties considered a critical breakthrough, the largest banking lobby in Washington embraced the idea. “We now see this as a way to help the package pass,” said Ed Yingling, president of the American Bankers Association.
While the move would result in banks paying higher fees on their insurance premiums, advocates say it would provide important assurances to small businesses that keep large sums of cash in bank accounts and are reeling from the credit crunch. “We are having an awful lot of people come into banks and ask questions,” Yingling said.

The Third Quarter Ends
Posted by Eddy Elfenbein on September 30th, 2008 at 5:24 pm

Interesting times. On a huge down day yesterday, the Buy List outperformed the S&P 500 by 266 basis points. Today was a huge up day and we underperformed by 172 basis points.
Over two days, we’re down 2.81% compared with a 4.00% loss for the S&P 500, with far less volatility. Score one for buy and hold.

Investing in 2008
Posted by Eddy Elfenbein on September 30th, 2008 at 4:31 pm

From Guest of a Guest, the 401-keg:

If you had purchased $1,000.00 of AIG stock one year ago you would have $44.34 left.
With Wachovia, you would have had $54.74 left of the original $1,000.00.
With Lehman, you would have had $0.00 left.
But, if you had purchased $1,000.00 worth of beer one year ago…drank all of the beer, then turned in the cans for the aluminum recycling REFUND, you would have $214.00 cash.

Worst Percentage Days for the Dow
Posted by Eddy Elfenbein on September 30th, 2008 at 4:04 pm

Date………………………………..% Chg
10/19/1987………………………..-22.61
10/28/1929………………………..-12.82
10/29/1929………………………..-11.73
11/6/1929………………………….-9.92
12/18/1899………………………..-8.72
8/12/1932………………………….-8.40
3/14/1907………………………….-8.29
10/26/1987………………………..-8.04
7/21/1933………………………….-7.84
10/18/1937………………………..-7.75
2/1/1917……………………………-7.24
10/27/1997………………………..-7.18
10/5/1932…………………………-7.15
9/17/2001…………………………-7.13
9/24/1931…………………………-7.07
7/20/1933…………………………-7.07
9/29/2008…………………………-6.98
7/30/1914…………………………-6.91
10/13/1989……………………….-6.91
1/8/1988…………………………..-6.85