03/28/2011
December 3, 2017
03/15/2011
December 3, 2017

03/21/2012

Lots of questions today–so buckle up..


Given I think the yuan will rise over time I think it makes sense to own companies who have 100% of their revenues in yuan to get the max benefit of that currency. I have been watching china stocks for a re-entry and think its time for Beijing Airport, BJCHF. At .51 its had a nice correction and today I saw a report saying its now the 2nd largest airport by volume in the world, surpassing London. Impressive place, very modern and just takes tolls on people coming and going and all revs in yuan. Have you looked at these or are you considering plays that get the currency kicker? thanks

It’s a beautiful airport. I’ll give you that… I just wonder about valuation. What is the growth rate from here? I don’t know the details well enough to have a real opinion. I just feel that it is close enough to fair value that it isn’t worth really diving into at current prices. I am also pretty suspicious of the view that the yuan is destined to rally significantly from here. China is increasingly reporting trade deficits against countries that aren’t named USA… Could the yuan be closer to fair value than many American politicians want you to believe?


How are you thinking about potential opportunities in Japanese equities post teh current quake/tsunami?

I have to admit that I haven’t looked too closely yet. I am not very familiar with the equities there, so there is a long education needed.

When the market collapsed on Sunday night, I bought Nikkei futures at around 8,300 right before they went limit down. Just felt that down over 20% was an overreaction. I’ve already sold them for nearly a 10% gain. I have called a number of very knowlegable friends looking for individual equity ideas. Thus far, nothing really stands out. Japan has been cheap for years, it’s cheaper now. Until structural issues are resolved, it will remain cheap unfortunately. You need something that has really been oversold to get me interested…


You have written how insider buying clusters interest you, what about these sales in MERC? Thanks for all you do.

Clearly, sizable insider selling is never a bullish development. I used to become much more concerned by insiders selling new highs. Over time, I have learned that when an executive suddenly has a big gain, he likes to take some profits. There’s not much wrong with it. My hunch is that they’re pretty well motivated still by the stock options that they got over the last few years at much lower prices.

In my experience, the only time I really worry about insider selling is when a stock has been declining for a few months as the market has figured something out–then the CEO figures it out and blasts out. That usually means that something the market only sensed has now become reality. Sales at new highs aren’t the same to me. Clearly, this isn’t bullish, but I am not that worried–at least for now.


What do you think about secondmarket.com?

I don’t know anything about it. Could be an interesting place to look for esoteric and undervalued situations…


Is uranium dead or is this a good opportunity to pick up some low cost producers?

Uranium isn’t dead. I have absolutely ZERO interest in the sector now. I thought that there was an oversupply situation building (despite what many stock promoters want you to belive) even before the earthquake. Now there is an increasing likelyhood that in the short term, there is demand destruction as well, as existing plants come offline for inspection/re-regulation.


To what extent do you use change in stock price (over time and greter than industry change) for insights that something might be happening to a specific stock. If for example, you take ANMCF, it has steadily declined meaningfully over the last two weeks. Would you read into the movement that someone knows something and you should think about selling. If not, why not, after such a large and sustained move. Thanks.

It’s hard to read much into short term stock movement. This is a stock that rallied from 10c at the shart of 2009 to over a dollar at the end of last year. Some sort of pullback on profit taking is only natural. The company recently announced that they are six months behind schedule when it comes to getting community agreements. This is not a disaster or anything–it is almost expected when dealing with jr mining companies. However, some shareholders are clearly frustrated and lightening up. I think all is going well at the company. There are just some delays…


Do you think there is anything worth investing based on the (additional) Japanese construction wood demand?

My trader bought a ton of lumber futures….might be worth a look…


I wanted to ask about Bloomberg and other tools of the trade.  Do you have a Bloomberg terminal and/or a service of equal purpose.  I’m just wondering if you see it as a must have for serious investors?  Are there any other tools or services you would suggest are essential?

On another topic, what is your view on Canadian forestry companies.  I have my eye on Interfor (IFP-A.TO) and possibly Canfor (CFP.TO).  They are starting to see pre-crisis wood sales again, with the Asia factor supplementing the US downswing.  After all of the very lean years and issues like the pine beetle, it seems to be the backdrop for an industry where the survivors should be well positioned.  This rebound is not news for Canadian resource focussed crowd, and the stock prices reflect it.  Maybe from a global perspective it is a story that has more legs.  What are your thoughts?

I have a Bloomberg and find it helpful, but not indispensable. There are cheaper options out that that do 80% of what BBRG does. I know quite a few professional money managers who get by just fine with Google Finance. It all comes downn to what you need it for.

People spend too much time worrying about the US housing market. The rest of the world is growing and in need of lumber. I don’t know the particulars on those two companies except that Canfor shows up almost every week on my insider buying scans.


SAN FRANCISCO (MarketWatch) — Inflation is hitting the diaper market.

Huggies maker Kimberly-Clark said Thursday it is hiking average selling prices by 3% to 7% in the U.S. and Canada on its Huggies diapers and baby wipes, Pull-Ups training pants and GoodNites youth pants. The price increase goes into effect June 19. A concurrent price increase of 7% will be applied to the company’s Cottenelle and Scott 1000 bathroom tissue sold in the U.S.Dallas-based Kimberly-Clark said it’s raising prices to “offset inflationary pressure from higher raw materials and energy costs.” In 2010, Kimberly-Clark paid $790 million for its basket of commodities, up $220 million from the prior year. On Jan. 25, the company estimated input costs would go up as much as $250 million.

Key commodities Kimberly-Clark purchases are fiber, polymer resin, and petroleum-based materials. The primary raw material for its disposable diapers and tissue products is cellulose fiber, in the form of kraft pulp or fiber recycled from recovered waste paper.

Kimberly-Clark is in the process of closing five to six of its pulp-manufacturing plants to boost operating profit. Currently, the company buys roughly 90% of its virgin fiber from outside sources.

Yup. Bernanke is going to destroy everyone’s standard of living before he’s done–even the little kids are going to be impacted…


http://www.mysanantonio.com/news/local_news/article/Burrito-price-leads-to-shooting-standoff-1226571.php

Yup… Coming to a Taco Bell near you. Inflation destroys the fabric of society.