• Economy Grew By 3.4% in Q2
    Posted by on July 27th, 2007 at 10:20 am

    From Bloomberg:

    The 3.4 percent annual pace of expansion, the most in more than a year, followed a revised gain of 0.6 percent in January to March, the Commerce Department reported today in Washington. The Federal Reserve’s preferred inflation gauge rose at the slowest pace in four years.
    Spending on commercial construction projects rose at the fastest pace in 13 years, helping to overcome another drop in homebuilding. Factories ramped up production to fill orders from Europe and Asia that made up for a slowdown in consumer spending. Treasury securities erased gains, stock-index futures trimmed losses and the dollar remained higher.
    “The good news is that capital spending and exports are growing,” said Nariman Behravesh, chief economist at Global Insight Inc. in Lexington, Massachusetts. Still, “the economy is plodding along. We’re very vulnerable to a shock.”

  • Radio Silence
    Posted by on July 26th, 2007 at 11:59 pm

    I apologize for the lack of posting earlier. I’m at the Money Show investor conference in San Francisco.
    There’s not much I have to add to today’s news except to say that it was very ugly out there. The Buy List, however, was down -1.32%, which was 101 basis points better than the S&P 500. I guess that’s sorta good news.
    Also, I’m not buying that this is about valuations. The Value Index (^SVX) was down more than the Growth Index (^SGX). Actually, the Value Index has beaten the Growth Index for seven straight days. That seems a bit odd of a sell-off.

  • Possible Headline
    Posted by on July 25th, 2007 at 2:01 pm

    From the AP:

    Amazon Soars on Strong 2Q, Upgrades

    Or my suggestion:

    Amazon Now Down 20% Instead of 35%

  • Guess This Stock?
    Posted by on July 25th, 2007 at 7:31 am

    image502.png
    Give up?

    Read more…

  • Behold the Power of Wednesdays
    Posted by on July 25th, 2007 at 6:23 am

    Since I got so many e-mails on this subject, I wanted to revisit my post on how good Wednesdays have been for Wall Street.
    Going back exactly six years, the days of the week for the S&P 500 break down like this:
    Monday 1.31%
    Tuesday -9.96%
    Wednesday 37.19%
    Thursday 4.99%
    Friday -1.85%
    That’s capital gains only. For all five days, the S&P 500 is up 28.97%. So except for Wednesday, the rest of the week is net down.
    So what’s the deal on Hump Day?
    A few emails suggested it could be due to Fed meetings, or possibly when the oil stats are released. Personally, I think it’s due to Lost which broadcasts on Wednesday. For the next six days, everyone on the Street says “What the fuck was that about?” It’s just a theory.
    Let’s get some grad students on it.

  • What’s Up 551% in San Diego?
    Posted by on July 25th, 2007 at 6:15 am

    Foreclosures.

    Home foreclosures in San Diego County continued their troublesome upward climb in June, but analysts say the number has yet to reach a threshold that creates a drag on real estate prices or the economy at large.
    “California is better off than the nation and San Diego County is better off than California,” said researcher John Karevoll of DataQuick Information Systems. “It still is not a major factor in the real estate market, but if there is a recession, it could become a huge factor.”

  • The Bond Market Says No
    Posted by on July 24th, 2007 at 10:09 am

    I used to think if there was reincarnation, I wanted to come back as the President or the Pope or a .400 baseball hitter. But now I want to come back as the bond market. You can intimidate everyone.
    –James Carville

    Last week, I mentioned that KKR had canceled a loan deal for Maxeda, a Dutch department store.
    Now comes another story. Expedia (EXPE) had this great idea to buy back a gazillion shares of their stock. Not with money, but with “future money” otherwise known as debt.
    The bond market looked at the plan and said, “no dice.” Bloomberg reports:

    At least 20 companies have canceled or postponed debt offerings since June 26 as credit markets grow tighter.
    The extra yield investors demand to own high-risk, high- yield, or junk-rated corporate bonds has jumped 0.85 percentage points to 3.37 percentage points since the day before Expedia announced its share buyback, according to Merrill Lynch & Co. index data.

    EXPE dropped 9% yesterday.

  • Earnings, Earnings and Earnings
    Posted by on July 24th, 2007 at 9:36 am

    After the close yesterday, W.R. Berkley (BER) reported operating earnings of 92 cents a share, 10 cents more than last year. The stock is going for less than nine times earnings.
    The other insurance stock on the Buy List, AFLAC (AFL), reports later today.
    I also noticed that Dell (DELL) closed at a 15-month high yesterday.

  • Corus Bankshares
    Posted by on July 23rd, 2007 at 1:41 pm

    Ever heard of Corus Bankshares (CORS)?

    Don’t worry, you’re not alone. Corus is a pee-wee-cap bank that specializes in making condo loans in markets where people like to overpay for condos. Without anyone noticing, CORS has become one the top-performing stocks of the last generation.

    Over the last 30 years, shares of Corus are up about 45,000%. That’s amazing. Put it this way, Corus has lapped the S&P 500 about 30 times in 30 years and more than doubled Intel (and I bet you heard of that one). Still, few people know about little Corus.

    The reason I bring this up isn’t to tout Corus’ long-term record, but to draw your attention to today’s earnings report. For Q2, Corus netted 74 cents a share, which is a big drop off from the 82 cents a share it made last year. The culprit, naturally, was the real estate market in places like Florida. But here’s the interesting part: Wall Street was expecting much worse. The average of the three analysts was for 61 cents a share.

    I don’t mean this as any hyper-sophisticated analysis of the real estate market. It’s just interesting to note that even experts are having difficulty seeing the magnitude of the housing mess. Perhaps it’s not as bad as it looks.

    Meanwhile, shares of Corus are up about 6.4% today.

  • Lindsay Campbell for Seasonique
    Posted by on July 22nd, 2007 at 4:56 pm

    I could’ve sworn I’ve seen this girl somewhere before.
    Oh right! It’s WallStrip‘s Lindsay Campbell promoting Barr Pharmaceuticals‘s (BRL) Seasonique.
    I wasn’t really paying attention to what the product is used for. (I think it’s girl’s stuff.) But I’m amazed at Lindsay’s footwork. I’ve watched it a few times and she stops the ball without looking. See for yourself.
    Let’s see David Beckham do that.