The Stock Market and Investing

fintail

There's the danger of nationalism and the danger of cultural suicide, the latter of which is invoked by the EU. Damned if you do, damned if you don't...

It's time for Europe to really start footing the bill for its own defense, and I don't mean the paper tiger of NATO. I want to see the US pull out of the area, just as I want the US to stop wasting lives and money on Israel. If both of those came to be, the money saved could be use to massively improve the USA itself.

Germany is in every position to make demands of Greece. Just like before WW2, Germany remains the heart of European industry and viability, and the engine driving the entire continent. As goes Germany goes the entire continent, whether or not the Greeks (or Brits and French for that matter, who don't seem to get it ) want to admit it.

Mr_Shiftright

Europe can defend itself. They are more apt to use diplomacy and a very efficient police force rather than military muscle to get what they want. They have developed these skills out of necessity and they are very good at it. They catch more terrorists than we do, for instance. They are also more experienced in dealing with terrorists, having suffered far more of it than we have over the last few decades.

True, in the past the USA created a paradise in Europe that Americans could not afford to live in (how ironic) but of course we were using Europe as a human shield against the Russian hordes. We knew it, the Europeans knew it and the Russians knew it. That was the game then.

Now, new game.

fintail

I agree, Europe is 110% capable of defending itself, and has been for some time. They have small but very skilled militaries, and terrorism detection that is at least as good as what exists in NA. It's time to end a 65 year old occupation, and complete the handover. It's all about ego now, nothing else. Let them regain control and pride, they can then correct their demographics and move forward.

If only the advice of Patton had been heeded...a lot of resources later on would have been saved.

stever

I think it's all about the oil.

Maintaining bases in the EU puts us a lot closer to the ground.

fintail

We can do pretty much everything from aircraft carriers and other bases now.

I think a lot of people still get a kick out of occupying Europe...remnants of the last victory.

stever

Not that many troops fit on carriers. There were 54,000 last year stationed just in Germany. UPI

Using lots of troops is a bit last century though.

There you go - invest in companies that make drones and remote interface joystick controls. Short companies that make military apparel.

fintail

But are 54K troops needed? It's very debatable. Then all of them we have in Italy, I think there are still some in the UK too.

We could just station them in Israel, seeing as that whole drama show is being built on our dime anyway :sick:

Mr_Shiftright

I agree....modern warfare doesn't require large numbers of troops, and certainly not any stationed in Europe. Modern wars will be fought right in there with the civilian population. It's a nasty business and no place for swarms of tanks.

Patton? I dunno. Attacking 560 Russian divisions did smack of "too many dreams of glory" for George I think. Quite a character though. Tactically brilliant, strategically naive IMO.

Actually, despite being the bleeding heart that I am, I did buy some FLIR stock, since it also has excellent civilian uses.

The story of Europe is quite remarkable if you think about it. It's been an amazingly rapid shift (in historical time frame I mean) from slaughtering each other for countless centuries to a land mass where you hardly even see a soldier anymore.

In any event, now with our rapid communications and interlaced economies, investors don't go near any place that smacks of violence.

circlew

Relative to the U.S., it looks like the recovery will go south or at most stay flat for the summer if this little stat has merit. If people cut their driving, spending goes along for the ride.

Oil Prices and Vehicle Miles

That site is awesome, Shifty!

Regards,
OW

Mr_Shiftright

I'm glad you liked it. I was quite impressed by it myself so posted it over here, where I thought it would be appreciated by y'all (since the recovery might go south I think we should start talking like that, too). :P

Always some interesting tidbit on that site.

fintail

It's going to be harder and harder to defend the insane military presence we have in so many foreign locations, as time goes on. Wars will never require hundreds of thousands of front line men again.

People forget we had nukes for some time before the reds were able to slither their way into the tech. It wouldn't have taken much to demobilize the entire Soviet structure. But it would never have happened...looking at FDR's cronies/henchmen, Churchill's arrogance, and the tone set at Yalta, it was obvious that Soviet sympathies ran deep in the west. A few small historical changes would have produced a markedly different future. But as we know, shoulda coulda woulda isn't worth anything.

Longterm European investments seem dicey to me, for as you say investors fear conflict...and I see a lot of discord coming out of the continent within the next quarter century.

Regarding the recovery...just based on my instinct, I don't see anything significant for at least 18 months. And then we'll be getting close to 2012, and the world is going to end then anyway ,so it doesn't matter :shades:

ljflx

OW, the bubbles are getting larger and larger and more and more frequent. IMO - this is simply because the spread of money is just getting too overwhelmingly concentrated which is another reason why Wall Street bonus schemes can't last much longer. You have a whole bunch of people who couldn't run a candy store trading billions, tens of billions and hundreds of billions of dollars annually and the only way they can make money is by see-saw voluminous trading that ultimately needs to create a bubble to keep the trading going. The more this money gets concentrated the more money comes out of productive assets. The more leverage you allow in these trading bubbles the more dangerous this situation is and with 20:1 leverage in most commodity trading we just invite the bubble. If you had to invest in oil (or m,ost commodities) with no leverage, or the same 2:1 leverage as stocks have, would you really do it given a huge inventory, the prospect of a rising dollar, terrible fundamentals, future tax increases coming, interest rates around the world that have to rise and then the caveat, 8-10mln barrels a day (and personally I believe more than that) spare capacity? If you are looking at it as a dollar hedge or a Euro bet, that's crazy because the dollar will soon reverse course. If you're worried about future inflation that's crazy too because the only prices rising are in unsustainable commodity bubbles, and rising interest and tax rates are a much greter inflationary curb anyway. But this money has to go somewhere and unfortunately too much of it is going into bubbles that concentrate the monies even more rather than into productive assets that benefit society. So in order for the wealthy to get wealthier with excess (think the goons of Wall Street here, not the Bill Gates of the world that brought us productive assets to get rich) the more bubbles and unexplainable markets we'll have. Someday the only answer to this problem, unless we check it real soon, is to print more money and devalue the holdings of the concentrations. Otherwise this is going to be the same run away greenhouse effect that you have in major league baseball where there's a lot of teams and 2/3rds to 3/4ths of them of them can't build a sustainable team that can legititamately challenge for a title year after year, because they d'ont have the money to keep the talent they draft. The only answer there is take a niche buisness guaranteed profit allocation from revenue allocations (with low payroll) and find dominant pitching and win a title with it before you lose those pitchers. The concentration of money into few large market MLB teams is a microcosm of what's happening in the world of finance in the US.

cyclone4

I love your MLB analogy Len. It really helps to explain the dilemma.

Mr_Shiftright

Did you ever read "Moneyball"? Loved that book.

ljflx

No. Does it touch on the same business/sport business issues? Unless I'm reading about sports, history or science, I always read fiction.

Mr_Shiftright

Yeah it's about how Billy Bean figured out how to build a baseball team by completely disregarding everyone else's rules on how to pick players. He did with brains what others failed to do with money. Great, great book.

circlew

Thanks, Len. I agree that bubles are everywhere....still. The dead credit defaults are hidden away on the books of the Banks and the real banking problem continues with a few failing each week. The housing bubble is still unwinding.

It's the oil bubble that is beginning to build again. I guess when we hit $4.00/gal. gas and the masses can't afford the stuff, the new economy will bust.

Regards,
OW

lemmer

Close, Billy Bean was the MLB player who came out as a homosexual and wrote a book about it. Billy Beane wrote Moneyball. I know this because I picked up the wrong book at the library a couple of years ago.

ljflx

Pure speculation driving oil OW. My bet is there's $25-35 speculation oil prices and so much of that is driven by high leverage ratios. Demand has been flat for years. Note this graph vs the price changes:

http://www.bloomberg.com/apps/quote?ticker=.CLLRG%3AIND

circlew

Agree LJ, the bubble continues...



The producers are in the global economic driver's seat.

Regards,
OW

Mr_Shiftright

They weren't BOTH called Money Ball were they? :surprise:

kyfdx

Is that the same Billy Bean that was on the World Champion Cincinnati Reds in 1990?

tagman

Did you guys notice the sudden pullback today? I found it very interesting. The next few days could be revealing.

And... The 11,000 mark might be harder to achieve than anticipated... possibly due to programmed selling.

We'll see.

TM

cyclone4

Yes Tag, that was an interesting sell-off yesterday after trading more than 100 higher (the DOW) earlier in the day, but I am not in the least bit concerned. I think we are just consolidating for a few days and then the market will reach new highs. I expect the Dow to top the 11,000 mark within the next 10 days or so. The market is taking the European debt issues in stride. I dumped Tosheba early this week since it was acting like crap, but I added UPS and a stock called Temple Inland (TIN). I still strongly believe that one has to buy on every dip and enjoy the ride.

tagman

Absoutely... I totally agree with you.

However, I have a strong belief that there is a significant number of computer traders that have flagged a sell just shy of the 11K mark, possibly causing a bump or two as we approach the 11K threshhold... which I believe will be accomplished relatively soon.

As far as buying on dips, I have been doing just that, and I am also now poised to place another significant sum into the market if we get a significant dip.

TM

circlew

Could have been a response to this....

South Korea Naval Boat Sank

Regards,
OW

Mr_Shiftright

Well if North Korea wants to commit instantaneous mass suicide, I suppose it's free to do so. They have a huge land army but a totally obsolete air force and navy. Their army has no roof over its head, and no naval support, so they would be much more formidable defensively than offensively, IMO. I"m not military expert but North Korea would be insane to get militant right now. It's traditional allies are no more.

Remember the US media motto: "It's way easier to scare people than unscare them".

jlbl

Hi Tag,

As for today 13:00, EU central time, LHC Atlas detector has detected first proton collisions at 7 Teralectronvolts. Higly collided and excited myself.

Regards,
Jose

tagman

As for today 13:00, EU central time, LHC Atlas detector has detected first proton collisions at 7 Teralectronvolts.

Ahhhh, yes Doc... And the world is still in one piece. I am also highly excited.

TM

Mr_Shiftright

This is a BIG deal. This could resolve some very nagging questions in quantum mechanics.

stever

Too bad the supercollider in Texas didn't move forward after Reagan/Bush 1. But even with the overruns, CERN got it done cheaper (having some existing infrastructure helped).

I guess the biotechs will get hammered a bit due to the court ruling that threw out two human gene patents and put the rest of them into question. Then again, Myriad Genetics is up over a percent today. Talk about counterintuitive. Investors must have read the ruling instead of the headlines and liked something in there? After a 7% fall Monday though, I guess people are buying on the dip.

Mr_Shiftright

American culture better get off its "I hate science" and "smart people are snobs" kick and mighty fast, too. At the exponential rate of technical progress, if a country sits on its hands too long, it gets left behind in this modern world. We're struggling with automotive technology, we are backward in green tech, we are reticent in medical tech, and of course higher education has serious problems. I think we have more than enough juice to remain prosperous in a fashion but as a world leader---I do have serious concerns.

tagman

This is a BIG deal. This could resolve some very nagging questions in quantum mechanics.

Yes! You are probably not aware that I first posted about the Hadron project back when we were posting off-topic comments at the Luxury Lounge... quite some time ago... but Jose was the only one as genuinely interested in it as I was.

That's why he was posting me about the latest progress.

Good to know you are also interested.

TM

Mr_Shiftright

How could one NOT be interested in the Higgs boson? :P

cyclone4

Mr. Shiftright, Tagman, Jose, and Steve,

I have such an incredible desire to learn about the secrets/origin of the Universe that I am also extremely excited about the Large Hadron Collider experiments. I am all for spending money to unlock the secrets of the Universe. Ultimately, mankind will benefit immensely by this type of exploration and experimentation. I believe that it is a human characteristic to explore. If we stop exploring, we may as well admit that we died.

Mr. Shiftright, I am in total agreement with you that this nation better wake up and place MUCH more emphasis on science and math.

Here is a very interesting article from the New York Times today:

http://theweek.com/article/index/201383/What_the_Large_Hadron_Collider_might_do_- - - - - - 6_theories

stever

You might like this recent story about gravity too. But you probably already saw it.

Mr_Shiftright

I love The Week...it's a great magazine and a fast yet informative read. Covers lots of areas, and, as this article shows, can be amusing.

cdnpinhead

American culture better get off its "I hate science" and "smart people are snobs" kick and mighty fast, too.

Yeah, good luck with that. I agree, by the way.

American society and political power is aiming much, much lower, because that's where the votes (and most of the people) are. The pool of stupid people is large and growing. . .and here we are. Athletes & pop stars rule; physicists, not so much.

Mr_Shiftright

Hmmm....the problem with collective stupidity is that it creates a death spiral of sorts....if you have more stupid people than smart people, then there aren't enough smart people to teach the young not to grow up stupid. And on and on, until the Empire has not only barbarians outside the gates, but actually has barbarians running the Empire--LOL! Why am I picturing a fur-bearing German with horns on his helmet sitting in the chair of the Emperor of Rome in the late 400s? I need a beer

circlew

If you want to know the secrets of the Universe, just look within.

Regards,
OW

stever

Just Topeka it.

fintail

LOL at your last bit :shades:

I think the intellect of the people can be represented in the leaders they choose. Not an optimistic picture.

Mr_Shiftright

Oh thanks...that just sent a chill through my heart. Well I only have to live maybe another 15-20 years if I'm lucky, so I can fall away still dreaming of Eisenhower driving through NYC in a ticker tape parade, waving from his OPEN :surprise: Eldorado.

fintail

That scene certainly won't be repeated. With the way things are devolving, eventually that president will ride in a Chinese-built machine, with handpicked shills lining the route.

Mr_Shiftright

Well I don't know. There is a theory among historians that as an Empire declines, it becomes more pompous,belligerent and bombastic. This can take decades of course, or generations, to complete itself.

fintail

Pompous belligerent and bombastic...I don't see any of that these days :shades:

Oh, maybe a positive sign for some markets...about a week ago the house next door to my grandmother's hit the market as a foreclosure. I visited today, and there's a big "sold" sign on it...so at least one house will sell this month.

Mr_Shiftright

My main gripe with capitalism is that it fosters no loyalty whatsoever to anything. It goes where opportunity is. It's kind of like a giant caterpillar. :P

It's possible we may be shifting from a growth economy to a sustenance economy, and as individuals we may be taxed not on income, but on our consumption of things.

If this were true, then capitalism couldn't really adapt, but the capitalists who manipulate the financial markets could shift their focus to manipulating our consumption.

So money that once flowed into production will now flow back to banks. Nothing will be produced, only regulated.

fintail

Manipulating consumption...sounds like the micromanaging EU ideal, which is just as free from ethics and responsibility as what exists in NA.

No growth is infinite...endless limitless growth sounds like a way to define cancer - well, until the host perishes. Everything reaches a peak.

Mr_Shiftright

Well this is the Higgs boson of economics, isn't it? If unlimited growth can no longer fuel an economy, then what does?

As Yogi Berra said (reportedly): "Making predictions is very hard--especially about the future".

By the way, my thoughts have nothing to do with conspiracy theories about secret groups of world dominators---I still sincerely believe that human beings still operate in the dark, clever as they might appear.

fintail

Unlimited growth requires never-ending population growth, which eventually turns around and destroys everything. In the sense of the broadest horizon, sustaining what exists should be the goal.

I won't get into conspiracy theories here, but I don't think everything is random...if it is, there are an astounding amount of coincidences out there.