RE THE TORQUEMADA ETF
Looks like we have to add Glencore
Probably Barclays as well
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There have been 20 items by Jimbo (Search limited from 19-July 17)
WARREN CLOSES OUT HIS EQUITY PROTECTION SERVICE
With a cape of 33 for the S and P and the FED ending QE it looks like warren has decided the premiums are too low for his equity insurance scheme and has bought back his equity puts.
He made $2.5 Billion so he came out ahead.
But even he now thinks that long the S&P right now is a bad bet.
HOUSING JENGA ANYONE????
When you think about it housing prices in the USA are a giant game of JENGA
Due to the lending standards (or should I say non existence of such lending standards) of Fannie and Freddie
Each time they reduce their lending standards to keep the housing market juiced
Its like removing a wooden block from the tower.
Fannie and Freddie could be very profitable businesses if they maintained decent lending standards
Say 20% deposit.
But they dont - because they are being used as politically motivated pump primers for the housing industry.
And so the US housing industry (particularly at the lower price levels) has been turned into one gigantic game of JENGA.
RE THE TORQUEMADA ETF
Besides Wells Fargo we must add ZTE and EN+ to the ETF
I would like to add Fannie and Freddie to the ETF but......
After 10 years in the FED pen I think these are probably lifers and will never be released.
THE LONG SLOW CAPITAL BURN
Buy Swisis ten year bonds and give 5% of your capital away over the ten year period..
Just owning bonds is giving away your money!!!!
Without higher rates????.
Bonds are trading below the "Capital Neutrality " level.
Prices need to fall further.
BERKSHIRE _HATHAWAY - REVERSION TO UNDER THE MEAN
When Berkshire was founded way back when tis first ten years of average return was 19
Much greater that the S and P return of 2 per cent.
Not bad.at all - great out perfromance
Unfortunately its last ten years of returns have been 9.
Which is less than the 10 per cent for the Sand P
Thats right you would have been better of investing your money in an S and P index fund.
FANNIE AND SUBPRIME 2.0
Fannie now allows lenders to pay for closing costs
Cant wait for the 120% housing loan so "Owners" (thats a joke word) can pay off credit card and car loan debts.
After all following the logic to its ultimate conclusion why not put the car and credit card loans on the tab, back them with a government guarantee and securatise them as well.
Thats the next logical step.
AMERICAS TRULY WONDERFUL MORTGAGE MARKET
In the USA of A Uncle Sam dresses up as Santa Claus every day of the week for the American Home Buyer
He takes away all the risk, hurt and pain with wonderful 30 Year fixed rate mortgages
and no need for a deposit....97% financing!!!!!!! .
However the risk is not destroyed.....no no no.... it is merely transferred to a BAG HOLDER
Who it this BAG HOLDER you might ask????
Well through the magic of Freddie and Fannie its the US Taxpayer
(Well really right now the holder of US treasuries given the Governments taste for deficit financing).
What could go possibly Wrong?????
Subprime 2.0 perhaps????
Its gets even better
Because the banks got so burned in subprime 1.0 they are letting the non bank lenders with no capital take on the task of originating and servicing the loans
Isn't that nice of them
No more nasty fines from the government or write downs if all the loans go suddenly south.
Well except for the NBL's that is,
But by then the Government will just be an unsecured creditor in the Bankruptcy courts.
THE GOVERNMENT PROSECUTION ETF
I note that after the Government let up on its regulatory and fines avalanche on Citi Group and Bank of America their share prices doubled in fairly quick order.
Will the same happen with Wells Fargo???? which is currently being given the same treatment.
There should be an ETF that takes advantage by investing in these sought of companies that are being subjected to the full force of the tender regulatory attentions of the Government!!!!
It of course needs a catchy name for marketing purposes.
Let me see.....The Tom and Jerry ETF.???? ........the Regulatory Waterboarding ETF?????
How about the TORQUEMADA ETF!!!!
THE CAPE DOES NOT LIE
CAPE of 33 for the S&P
Australia much cheaper with CAPE of 18.
I am not optimistic for US stocks in 2018,
Still optimistic for Australian Stocks.
The whole tax cut and repatriation of funds for stock buybacks has such a last gasp feel to it.
THE BIG BOND FREE LUNCH
Who says there are no free lunches in financial markets
There are plenty of them!!!!! - Most provided by Governments
Take Freddie and Fannie paper
Pays almost 1% over treasuries
And all guaranteed (OK implied guarantee ) by the US government,
All so the us homeowner can get cheap 30 year funding.
Why own treasuries when you can own agency paper which is the same thing and pays a higher rate!!!!
TREASURIES - THE GIFT THAT KEEPS ON GIVING
No not a GIFT to the bond holder - Its a GIFT to the BORROWER the US Government!!!!!!!!!!!
At 2% interest with 2% inflation and 0.5 tax you are giving away 5% of you capital whenever you buy a new 10 year bond.
And yet people are still buying them all the time!!!!!
Bond need to pay 3% to compensate for inflation and tax and that is with a NIL return for the time value of money,
Add in a decent 3% return for the time value of money and 10 year bonds should be returning 6%.
INTRODUCING THE MUNICIPAL SINGLE STATE SHORT ETF
Since we have single state municipal bond funds why not have single state municipal bond short ETF's
The Puerto Rico Bond short ETF
The Illinois Bond short ETF
The Conneticut Bond short ETF
I think this will be a growing theme from now on.
INTRODUCING A NEW ETF
First I introduced the Trump ETF
Then I introduced the Deep State ETF
Now I Introduce the Smart Trump/Deep State Arbitrage ETF
This ETF automatically arbitrages (by moving capital) between the Deep State and Trump ETF's depending on whether the news is positive or negative for Trump in any one week.
FANNIE MAE STOCK as A Politicical INDICATOR
As I have previously stated you can use the stock price of FANNIE MAE as a fairly good indicator of the Trump Vs Deep State battle.
Its been downhill since the election
Was November 2016 PEAK TRUMP???
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