Lingerie Ads Denied?

[wndysrf]

Mark?s Market Commentary ? December 4, 2002

 

A couple of years ago, there were some Maidenform lingerie ads which created a firestorm. Full length pictures of beautiful, thin models wearing the finest lingerie, and the caption on the ad said ?Inner Beauty Only Goes So Far??

 

The Girlfriend of the Week featured in this ad is posted at the end of the commentary.

 

Last week, the same group was complaining about the Victoria?s Secret Fashion Show.

 

Local feminist groups were complaining about how the ads were ?demeaning to women? and ?made them feel self conscious? and were ?unfairly biased? against fat women.

 

The politically correct fashion propaganda machine continues to brainwash the public about how being fat is ?OK?, and Hollywood should hire more ?regular? women for the shows and ads.

 

This is a joke. No wonder Maxim and FHM magazine are the latest hits at the newstands.

 

What is amazing is how the same type of baloney gets fed to Joe Public by the Wall Street Matrix.

 

Gold has been revered for thousands of years. The ultimate store of value. An item which is nobody else?s liability.

 

And it looks like gold is on the move again, as the Office of Plungeland Security is having a difficult time holding it down.

 

I know a guy whose wife cuts out pictures of all the lingerie ads in the local paper before she allows her husband to read it.

 

Uncle Al and the Gang of 22 have also been accomplishing the same thing by knocking gold down by short selling it every time it gets going.

 

What are the odds that the physical demand can continue to increase without the COMEX price exploding?

 

What are the odds that Ms. Paranoia?s husband isn?t having Victoria?s Secret catalogs sent to his office address? And what are the odds that he?s abstaining from the Gentleman?s Club visits after work?

 

Natural forces cannot be denied.

 

Yet The Matrix continues to brainwash the public into thinking that trading and investing in paper assets guarantees a road to comfortable retirement. It is amazing that there are still more mutual funds out there than publicly traded stocks. The mantra of ?buy and hold? continues to be drummed in the financial media despite the worst bear market of our lifetime.

 

I wonder what will happen when some bullion dealers start printing up some ads showing those shiny, gold coins. Coins which which elicit the same primitive instinct to ?touch? and ?feel?. The same instinct which causes men to grab and grope at skinny models wearing delicate lingerie.

 

But instead, Proctovision continues to drag out the old bull market icons like Bob Froelich.

 

When will guys like Bob Froelich get dragged into the town square, to be tried for incompetence, gross negligence, and dereliction of duty?

 

And high tech officers have also been recruited as new agents by The Matrix:

 

Microsoft sees tech stock sentiment improving: DJ[/i] (MSFT) by Tomi Kilgore Shares of Dow industrials component Microsoft (MSFT) spiked up 65 cents to $57.36 after Dow Jones reported Microsoft's (MSFT) chief financial officer John Connors as saying investor sentiment toward technology stocks should continue to improve as valuations and profits stabilize. The report quotes Connors saying price to earnings ratios have moved to "more normal and sane levels."

 

What???

 

Is MSFT fairly valued at 10x sales? No. But Conners is likely to get a hefty bonus from Bill Gates, who has been relentlessly offloading shares.

 

What will people think after MSFT is at $28/share?

 

By that time, Connors will have ?retired? to ?spend more time with family?, while the average 401(k) holder is stuck holding the bag.

 

Check out the AskResearch chart on MSFT. Lower low on higher volume, and the Money Flow Index is finally rolling over. What a sad case.

 

MSFT

 

Anybody had enough of these ridiculous ads on TV?

 

How about those buzzy, jazzy Harris Direct ads showing Joe Public looking at pie charts on his computer monitor and making his own trades? A couple of points and clicks, and then its off to play with the dog or the kids. None of these characters work at real jobs. All they have to do is daytrade for 10 minutes each day, and they can enjoy the rest of the time frolicking around in their designer decorated apartments.

 

Anybody tired of those Daimler Chrysler ads? With all those foreign kids being brainwashed into the borrow and consume lifestyle by learning how to say ?I want a new car for zero interest? at the age of 2? If I hear that stupid horn honking one more time?.

 

And then there are the ads from Raymond James, and all the major insurance companies pushing some type of ?dream? scenario where single moms making $28,000 a year can parlay their child support checks into a $250,000 education fund for their kids some day.

 

When will we see some ads promoting gold investment? And a few companies promoting underground safes. Safes which protect your life?s savings from Uncle Al redlining the reliquifaction blender and devaluing your dollar investments?

 

Today?s Action

 

With today?s gap down on the open, I expected a rather heavy volume day to the downside to complete a three day reversal and an island top on the Nasdaq. But somebody came to the rescue, because the billion eyeballs watching the QQQ?s would have known that if such an event occurred, then you would have many people scrambling to the exits.

 

But The Matrix brought things under control, and held things together to avoid the ?catastrophic? decline, and managed to execute yet another intraday jam job into the close.

 

Last night, Astrikos reported sky high put/call ratios, as everyone was bracing themselves for a major break to the downside. Now we have to see what happens after today?s doji day on the QQQ?s.

 

Midpoint of the move? Or the sign of another short term bottom?

 

Both the DIA and SPY tracking stocks made lower lows on higher volume, so that?s another confirmation of a bearish scenario.

 

The bullish percentage numbers as of Monday?s close were at or near the January highs. Most sentiment indicators, with the exception of the put/call ratio and the fear gauges, are now at bull market extremes. It may take the rest of the month in a sideways trading pattern to work this off before the market rolls to the downside.

 

And of course, INTC?s mid-quarter report comes out tomorrow night. Will they provide higher guidance? I doubt it. That?s because that former 7-11 night shift manager (Dan Niles) was busy pumping the stock on Monday.

 

When is that guy going to get fired?

 

Anybody getting sick and tired of these bald faced lies coming from these multicultural freaks masquerading as stock anal cysts?

 

INTC is in the same boat as MSFT:

 

INTC

 

Position Summary:

 

Another half short added:

 

Half short on INTU at $53. Heavy insider selling on this one, and today, the WSJ reported a massive sale by the company?s CFO. And today we see a ?reaffirmation? of guidance. Who do you trust? The P/E on the stock is somewhere between 173 and 83, depending on which chart service you use.

 

We are 42% short, 12% long, 46% cash.

 

Half Short:

 

LOW at $42

KSS at $66

INTU at $53

 

Quarter Short:

 

FRE at $68

CFC at $49

MBI at $54

KBH at $49

LEN at $56

TOL at $27

NCEN at $30

BBBY at $35

COCO at $40

 

Half Long:

 

BGO at $1.31

HL at $4.10

PAAS at $5

DROOY at $3.35

GG at $10

GLG at $9

[wndysrf]

Girlfriend of the Week:

[Guest]

Hey Mark,

 

Good to have you back! And good timing (I should think) to go short again. Have a look at the Dow 60 minute chart. We may be witnessing an attempt at a right shoulder. How about gold It looks strong now. Short sellers failed to close the contract below its 100-day moving average on Monday and had to come right back to cover. The rhetoric will be stepped up ahead of Iraq's deadline to report its arsenal of weapons next Sunday. Gold is therefore likely to advance further ahead of the weekend. Fear of war and terrorist attacks should underpin the HUI and XAU.

[Fartpolio Manager]

The absolute worst ads on the tube are the frickin Ameritrade ads... Especially the one where someone says they own EMI and then a frickin bunch of hams come on singing off-key... Don't they realize they just bring on consumer hatred?

Be something if the ad ran once, but all day long... it comes on and I'm looking for something to throw at the TV... When will dignity return to the advertising business, I'm sick of what Madison Ave. considers "entertainment".

[Charliss]

When will dignity return to the advertising business,

We would have to resurrect David Olgivy... of the old Olgivy, Benson and Mathers agency.

 

He favored giving information on the products he choose to take on as clients, and he would not take on a product he would not personally use. He drove a Rolls, filled it with Shell, wore Sears suits and Rolex watches. Whatever medium he used, one learned a lot about the products.

 

"Confessions Of An Advertising Man" tells this story.

 

The Harris Direct ads with the lap top perched on the kitchen countertop and showing, of all things, pie charts, are especially awful. I shall have to resume my "culture objector" status by sending them an email (the last time I did this was to Cadillac and their ad agency, accusing them of creative laziness, lack of originality, and plagarism when they aired an Elante ad: "Ever wonder how the race car driver gets to the race track?" was a redo of the old VW ad "Ever wonder how the snowplow driver gets to the snowplow?" The Cadillac ad sort of went away.

[The End]

Fart,

 

I went long gold today for people. long term. If we go down, i will reco. adding to the position.

[buttugly]

How about the 3 day action on the SOXX - down 16%.

 

Having said that the SOXX is still 60% up off it's October low.

 

I was doing some reading on semi conductors.

Migration to 300 mm, forecast revenue growth in 2003 19.8%. $169b revenue industry blah blah

 

On the face of it the semi conductor industry seems like a good industry (long term) albeit very cyclical.

 

However when the media focuses on revenue growth you have to dig deeper.

 

If you listen to Intel and their focus on expanding margins (approaching 50%) you might think that this is a high margin business. But you have to bear in mind that Intel refuses to expense stock options. Plus generally semi conductors need to spend 20% of revenues on capital expenditure to keep pace with the constant migration to small chips. Of course these expenses are capitalised and depreciated.

 

So I would argue that it is actually a low margin business that is being increasingly commoditized. China is destroying all pricing power and industry excess capacity is high and growing.

 

Most amazingly Intel has been reluctant to set up production in China as they are afraid of a number of factors (refer recent Red Herring story). OK so they are big in Taiwan - but that ain't good enough these days

 

Yet if you look at Intel's market capitalization versus

their share of global semiconductor revenues - Intel makes up something like 20% of revenues but 35% of global market cap.

 

So I refer back to Leon Levy, and his concept of power shifting to Asia.

 

If you think the semi conductor industry is going to turn soon (which I personally don't see until late 2003) then

Intel is not necessarily a good bet.

 

Furthermore, I can't see how semi conductors are going to lead us out of this quagmire.

 

The only reason there is so much action in this sector, is that it is a large liquid area in which MFs/hedge funds

can game the market.

[richmtn]

Nice to have you back Mark. I do so enjoy reading you.

 

"I know a guy whose wife cuts out pictures of all the lingerie ads in the local paper before she allows her husband to read it." M2M

 

Now I'm no cave man and I know you said the guy probably reads the stuff elsewhere. But I just do not understand why guys let themselves be treated that way. Don't they have any pride? Are we supposed to accept "the fact" that there is something sub-human about men's behavior?

Plus I'm sure you are aware that women say they want "nice" guys and then date the bad boys. Then the nerve to complain about his behavior afterward. What did they expect?

Every time I read your column I'm so glad I'm not in that rat race.

Signed

Settled and not afraid to be a man.

[Guest]

Mark,

 

New member to the Stool family, and it's my first post. I enjoyed your humor and your insight into the market. Have been lurking around and just committed full short positions, thankful to your short ideas. I am particularly bearish on COCO, on which I had run some preliminary #s. Several observations and good reasons to add short position on this one:

 

- This stock has largely been a growth story, however looking into their 10Ks their growth has been primarily funded through acquisitions, and they appeared to have overpaid for those purchases. This will eveutually catch up with them. For instance, they recently acquired Wyco college for about $80million, but that company's 2001 revenue was only about $27million and earnings $1.5, way overpaid;

1. The beauty of their acquisition growth strategy is in purchase accounting: every other quarter they could buy a local for-profit college and start consolidating its revenue and income into their financials, but they don't have to go back and redo the historicals - this makes y-o-y growth look spectacular but if you strip out the acquired revenue their organic growth looks pathetic.

 

2.They used both cash and debt to fund their purchases and this seems to have been corroding their balance sheet strength. Their recent Q shows an increase in debt and decrease in cash. Their balance sheet is weakening. Goodwill on the balance sheet also increased sharply - yet another piece of evidence that they overpaid for their acquisition!

 

3. Their recent profitability has also stemmed from 10% increase in the avg. tuition they charge - we are in a soft economy and how many people are willing to pay such a premium to get training? their pricing power is not sustainable.

 

 

4. Stock richly valued at high multiples of income and sales.

 

5. Technically the stock just dropped below its 50-day MA; and

 

6. Insiders have been dumping like crazy!

 

Perfect short opportunity, and thank you for identifying this target. Hope my input is helpful to you and my fellow stoolies. lol

[Hiding Bear]

Mark - great daily summary, as usual.

 

On gold, when the metal industry wakes up one day and realizes their job is to sell metals and not 'hedge', they might come up with an easier way to own gold.

How about a gold bank, or depository, preferably to be operated somewhere outside of the US, where customer's gold is held in common units - and could be delivered if necessary.

 

Gold will blow out to the upside when a secure system for owning units of gold is established.

[HiHat]

"I know a guy whose wife cuts out pictures of all the lingerie ads in the local paper before she allows her husband to read it."

 

I'd ask, who is the real dumb son of a bitch here

hint: it's not HER...(she's psychotic)

 

Looking for gold shares ..GG and AEM to take out

old highs ...INTERMEDIATE term. Maybe plus 32%

fibo.

 

On a good enough correction ..might swing trade

MLNM and PDLI around a little bit.

 

I confess.. shorting is not my forte',..I like to buy

PANIC, and bank the rebounds.

[Guest BigPaws]

I wasn't sure what you meant when you described Dan Niles as a "7-11 night shift manager" until the "mulicultural freak" part.

 

For shame. Such blatant and unwarranted hatred.

 

But hey this is your site and you're free to say whatever you want I guess.

 

Just wondering though, how do you know some of your readers aren't also "multicultural freaks"?

[longOnUranus]

We've gone from "bad news-ignore" to "good news-ignore", a very reliable short-term psychology indicator in my experience. Key will be how the ECB rate decision is handled by the market, other than the usual futures ramp coming this AM. The decision itself is inconsequential in my view, but I'm not an international financier kind-of-guy.

 

The obvious PPT hand pass at 230 (as well as manipulation of futures markets most early AM's) has become an element of disgrace to our nation. The fact that JohnQ prefers a planned economy is now evident, even though he doesn't realize this to be the case. With the planners in charge, we will now experience the rot and decay which was the end result of every other planned economy during the 20th century. Every PPT maneuver should now cause national dyspepsia, bulls and bears alike. It is a sad sign of how far we have strayed; Adam Smith must be stirring and sleepless this days.

[The End]

Jerry,

 

 

Welcome to the best damn web site, fur people like us.

[buttugly]

Bigpaws: I kind of agree with your sentiments.

There is a fine line between being funny and going too far.

And as you say it is Mark's page.

 

The only thing I would say is these people get paid

inordinate amounts of money and are completely

dishonest and have said things that have seen many people lose a lot of $. To compare them to USED CAR SALESMAN, would be unkind to car salesmen.

 

So when Abbey Cohen gets labelled as "a fat ugly troll'

this is a form of discrimination - but my heart does not

go out to her.

 

So I guess I feel the same way about Dan Niles.

 

On a differnt note check out

http://www.saavycharts.info/

I like that Caution comment and that Bearish box, almost as much as I like that lingerie model above.