The Stock Market

[Gambles]

gambles good luck with your wealth management, its easy to avg 10% / year in a mixture of blue chip and fixed term interest. I know what Im doing, I know which penny stock have been slaughtered and with a combo of T/A ( just check my charts vil and meo) and fundamentals I can scalp 20% in a few weeks. many go on to be 50-100% plus, but greed is a killer. the charts are my own. I offered to chart yours or any ones stock here but no takers. Gambles you haven't contributed much to this thread , oh unless "be careful" is a contribution...

if you want to contribute be specific. What fund? what stock? what currency?

Back your self with a commitment. What should we buy? more importantly WHEN? I already know you will come back with out specifics.

and puleez no "disclaimers"

Actually, Zorro, it's not that easy to average 10% / year

the average of the best private client managers have achieved 6.2% per year over the last 5 years in their balanced portfolios (PCI Index, Sterling, Balanced to 31.3.10)

Over the last 9 years (to 31.12.09) which is the longest period shown on trustnet Martin Gray's total return of 96% placed him 76% ahead of UK fund managers with the same aims who averaged 20% in total.

but whilever Martin keeps doing what he does, then that's fine by me.

Good lcuk with your speculation - be careful is the best advice that I can give you; other than that I don't think that I have anything useful to add to your enterprise, except don't do this with serious money - only speculate what you can afford to lose.

I'm not sure what soecific holdings info will tell you but I have absolutely nothing to hide - The Osmium Portfolio was until a few weeks ago allocated as follows:

Holding

Cash

37.97%

CF Miton Special Situations

24.91%

MAN AHL

6.68%

GAA Q

6.49%

Moonraker Commodities

6.38%

Moonraker GOP

5.52%

MOG Core Diversified

2.45%

Carmignac Patrimoine

2.43%

CF Miton Strategic

2.03%

CF Ruffer Total Return

1.92%

Turnstone European

1.90%

Berkshire Hathaway

0.75%

CF Ruffer European

0.57%

Total

100.00%

There have been quite a lot of changes during March and April - I can get you an update next week if you'd like.

This information is a specific answer to a particular question and not a recommendation as to the suitability of Osmium or any of Martin Gray or Scott Campbell's portfolios or any of the underlying assets for any particular investor.

Thanks Gambles, we have different styles and we should both be careful and keep a close watch , I do every minute of the day. The idea being sharing of more info here regarding real trading of course DYOR is the most important piece of advise. The endless articles posted here should be reserved for the financial crisis thread IMO. Thanks for your input

thanks Zorro

Good luck - I mean it; I hope your enterprise turns out really well for you. I take it you know the story of the Cornwall Capital guys - if not read 'The Big Short' if ever you're in need of more inspiration!

[siamamerican]

The world will continue to turn. The US will continue to function as an economy. Has it (and all the other indebted countries) recovered from its/their credit excesses. No it hasn't.

The stimulus packages have stimulated/protected just 2 sectors - banks/financials and housing. We can see exactly to what extent and we can deduce that its smoke and mirrors and it's probably going to take 20 years from now to actually fix the US banking and property sectors (I pick on the US because it's the biggest and it's now in the worst shape thanks to the policy decisions made in 08/09 although let's be clear all the indebted nations are in ugly shape).

I would give Siamamerican a firm undertaking to be far more positive if he or anyone can give me a

plausible reason why the real estate market in USA is not going behave substantially the same

( i.e.maybe not exactly the same ) as what has happened in Japan over the last 20 years –

but I haven’t read anything of the sort so far.

And as Americans used their homes as ATM machines, unless home values can be

restored ……as I see it prospects in the land of 70% GDP coming from

consumption will be rather “ muted “ because banks cannot carry deflated real estate on their books forever.

The irony is Bernanke knows full well what is in store and should be lynch mobbed but instead is

“ Person of the Year for 2009 “ .How bizarre is that ?

Hey we agree on something. In my opinion, the real estate market will return to the mean value over the last 50 years, which puts us at about 10% ( inflation adjusted) from the bottom. I don't see real estate out-pacing inflation for years to come and because of this the US consumer will have less money to spend on toys. America has nobody to blame for its current economic problems. The US has a history to adapting to obstacles and, I'll be the first to admit, it has a lot of work to do.

The world is less dependent on America than anytime during my lifetime. This creates opportunities for investors that can invest in the world economies. Countries like Australia and Saudi Arabia will benefit because of their commodity position. If you take natural resources out of the picture, Australia really hasn't accomplished much the last 10 years but why ignore the fact that it is sitting on a gold mine.

Investing is looking at both the negatives and the positives. Using Australia for example, it breezed right through this financial crisis and would seem like a good place to invest with its abundant natural resources. On closer analysis it looks much more risky. The mammoth Australian real estate bubble will burst, household debt and foreign debt are out of control.

I agree with you in that the world needs to stop living beyond it means. The problem is that it simply won't do that and Australia is a perfect example. The good times never end until they do and the world keeps moving along.

[Gambles]

The world will continue to turn. The US will continue to function as an economy. Has it (and all the other indebted countries) recovered from its/their credit excesses. No it hasn't.

The stimulus packages have stimulated/protected just 2 sectors - banks/financials and housing. We can see exactly to what extent and we can deduce that its smoke and mirrors and it's probably going to take 20 years from now to actually fix the US banking and property sectors (I pick on the US because it's the biggest and it's now in the worst shape thanks to the policy decisions made in 08/09 although let's be clear all the indebted nations are in ugly shape).

I would give Siamamerican a firm undertaking to be far more positive if he or anyone can give me a

plausible reason why the real estate market in USA is not going behave substantially the same

( i.e.maybe not exactly the same ) as what has happened in Japan over the last 20 years –

but I haven't read anything of the sort so far.

And as Americans used their homes as ATM machines, unless home values can be

restored ……as I see it prospects in the land of 70% GDP coming from

consumption will be rather " muted " because banks cannot carry deflated real estate on their books forever.

The irony is Bernanke knows full well what is in store and should be lynch mobbed but instead is

" Person of the Year for 2009 " .How bizarre is that ?

Hey we agree on something. In my opinion, the real estate market will return to the mean value over the last 50 years, which puts us at about 10% ( inflation adjusted) from the bottom. I don't see real estate out-pacing inflation for years to come and because of this the US consumer will have less money to spend on toys. America has nobody to blame for its current economic problems. The US has a history to adapting to obstacles and, I'll be the first to admit, it has a lot of work to do.

The world is less dependent on America than anytime during my lifetime. This creates opportunities for investors that can invest in the world economies. Countries like Australia and Saudi Arabia will benefit because of their commodity position. If you take natural resources out of the picture, Australia really hasn't accomplished much the last 10 years but why ignore the fact that it is sitting on a gold mine.

Investing is looking at both the negatives and the positives. Using Australia for example, it breezed right through this financial crisis and would seem like a good place to invest with its abundant natural resources. On closer analysis it looks much more risky. The mammoth Australian real estate bubble will burst, household debt and foreign debt are out of control.

I agree with you in that the world needs to stop living beyond it means. The problem is that it simply won't do that and Australia is a perfect example. The good times never end until they do and the world keeps moving along.

great intuition on Aus

terrible maths on US property....

[siamamerican]

The world will continue to turn. The US will continue to function as an economy. Has it (and all the other indebted countries) recovered from its/their credit excesses. No it hasn't.

The stimulus packages have stimulated/protected just 2 sectors - banks/financials and housing. We can see exactly to what extent and we can deduce that its smoke and mirrors and it's probably going to take 20 years from now to actually fix the US banking and property sectors (I pick on the US because it's the biggest and it's now in the worst shape thanks to the policy decisions made in 08/09 although let's be clear all the indebted nations are in ugly shape).

I would give Siamamerican a firm undertaking to be far more positive if he or anyone can give me a

plausible reason why the real estate market in USA is not going behave substantially the same

( i.e.maybe not exactly the same ) as what has happened in Japan over the last 20 years –

but I haven't read anything of the sort so far.

And as Americans used their homes as ATM machines, unless home values can be

restored ……as I see it prospects in the land of 70% GDP coming from

consumption will be rather " muted " because banks cannot carry deflated real estate on their books forever.

The irony is Bernanke knows full well what is in store and should be lynch mobbed but instead is

" Person of the Year for 2009 " .How bizarre is that ?

Hey we agree on something. In my opinion, the real estate market will return to the mean value over the last 50 years, which puts us at about 10% ( inflation adjusted) from the bottom. I don't see real estate out-pacing inflation for years to come and because of this the US consumer will have less money to spend on toys. America has nobody to blame for its current economic problems. The US has a history to adapting to obstacles and, I'll be the first to admit, it has a lot of work to do.

The world is less dependent on America than anytime during my lifetime. This creates opportunities for investors that can invest in the world economies. Countries like Australia and Saudi Arabia will benefit because of their commodity position. If you take natural resources out of the picture, Australia really hasn't accomplished much the last 10 years but why ignore the fact that it is sitting on a gold mine.

Investing is looking at both the negatives and the positives. Using Australia for example, it breezed right through this financial crisis and would seem like a good place to invest with its abundant natural resources. On closer analysis it looks much more risky. The mammoth Australian real estate bubble will burst, household debt and foreign debt are out of control.

I agree with you in that the world needs to stop living beyond it means. The problem is that it simply won't do that and Australia is a perfect example. The good times never end until they do and the world keeps moving along.

great intuition on Aus

terrible maths on US property....

I might have got it wrong on US property. I've invested heavily in real estate last year and follow the trends. What am I missing - please point me toward the data that shows US property is not close to 10% of the mean(inflation adjusted) of the last 30, 50 ... years. Actually sold all my real estate a couple months back so possibly my estimation is not well grounded.

[midas]

terrible maths on US property....

I might have got it wrong on US property. I've invested heavily in real estate last year and follow the trends. What am I missing - please point me toward the data that shows US property is not close to 10% of the mean(inflation adjusted) of the last 30, 50 ... years. Actually sold all my real estate a couple months back so possibly my estimation is not well grounded.

I don’t have a lot of faith in measuring according to ” mean(inflation adjusted) of the last 30,

50 ... years “ because conditions have changed so much and are still changing.

Shoot me down if I am wildly wrong but but I keep thinking about these statistics ?

80% of the world population lives on less than $10 per day and we can all reach this cheap labour source far easier than ever before. In USA and UK, we now find that many of the home loans were granted on the basis of 5 or even 7 times income wheras it should really only be 2.5- 3 times income.

At the same time I see the prospects that USA incomes will totally stagnate or fall even further far more likely than being able to achieve an appreciable increase in the $10 per day for the rest of the world because we now have 6.9 billion people and by 2020 it will be 7.6 billion people. I don’t think there will be a corresponding increase in employment opportunities around the world to feed an extra 0.7 billion mouths particularly with increased technological advances ?

So I don’t see how anyone can say for certainty today where the bottom of the property market really is and when it will be reached ?

[midas]

We need to ask the questions about the Midas in reverse policies inflicted by indebted governments of whom USG has been the most culpable so far. If you don't like it, Siam, cover your eyes and ears ......the next step is back to looking for reds under every bed and McCarthyism

Gambles

I dont profess to have asked the question this way but I just read this passage this morning

and thought it sums it all up so well :-

" The pom poms and nearly everything else was swinging wildly in the breeze this morning as the American financial press was wildly cheering the earnings news from Bank of America and their brilliant acquisition of Merrill Lynch.

Does anyone bother to notice that none of these banks are making any money from traditional banking activity? You know, the kind that is supposed to be supporting the capital allocation process and growth in the real economy? Its as if all the carpenters, plumbers, engineers and teachers left their real work and became carnies and professional gamblers, or even worse, politicians. We're celebrating that as a sign of a rensaissance and economic recovery."

http://jessescrossroadscafe.blogspot.com/

[Gambles]

I might have got it wrong on US property. I've invested heavily in real estate last year and follow the trends. What am I missing - please point me toward the data that shows US property is not close to 10% of the mean(inflation adjusted) of the last 30, 50 ... years. Actually sold all my real estate a couple months back so possibly my estimation is not well grounded.

It's impossible to say what the real value of US real estate is because the market has been price manipulated by the money supply for around 100 years now and also is now subject to the additional manipulation of the floor imposed by USG buying/guaranteeing over $ 5 Trn of MBS and other mortgage vehicles. When I say manipulated I don't mean some weird Dr Evil type consiracy theory - I just mean that market's normal actions have been impaired whether deliberately or inadvertantly by policy actions

Case-Shiller currently suggests that values are 30-40% above their log normal trend but a longer term line graph of nominal values looks even more alarming extraoplate the trend pre 70s and the mean reversion looks like 50% +

I've made a graph (not one of my skils) but I can't get it to upload - I can email to anyone who wants it (maybe someone could format the data and upload better than I know how???)

But USG can continue to out a floor in place and this would stifle the market for the enxt 20-30 years by preventing it ever reaching real value and waiting for demand to exceed people's reluctance to buy an artificially priced asset a la Japan

[Gambles]

We need to ask the questions about the Midas in reverse policies inflicted by indebted governments of whom USG has been the most culpable so far. If you don't like it, Siam, cover your eyes and ears ......the next step is back to looking for reds under every bed and McCarthyism

Gambles

I dont profess to have asked the question this way but I just read this passage this morning

and thought it sums it all up so well :-

" The pom poms and nearly everything else was swinging wildly in the breeze this morning as the American financial press was wildly cheering the earnings news from Bank of America and their brilliant acquisition of Merrill Lynch.

Does anyone bother to notice that none of these banks are making any money from traditional banking activity? You know, the kind that is supposed to be supporting the capital allocation process and growth in the real economy? Its as if all the carpenters, plumbers, engineers and teachers left their real work and became carnies and professional gamblers, or even worse, politicians. We're celebrating that as a sign of a rensaissance and economic recovery."

http://jessescrossroadscafe.blogspot.com/

As a Wall Street bank I make huge profits speculating on US property markets

The marets plunge

I lose big

USG injects $ 1.3 Trn and promises another $ 4 Trn

guess what I make it big again

I didn't do anything

But time to order new Porsches and more Champagne

[Abrak]

I might have got it wrong on US property. I've invested heavily in real estate last year and follow the trends. What am I missing - please point me toward the data that shows US property is not close to 10% of the mean(inflation adjusted) of the last 30, 50 ... years. Actually sold all my real estate a couple months back so possibly my estimation is not well grounded.

It's impossible to say what the real value of US real estate is because the market has been price manipulated by the money supply for around 100 years now and also is now subject to the additional manipulation of the floor imposed by USG buying/guaranteeing over $ 5 Trn of MBS and other mortgage vehicles. When I say manipulated I don't mean some weird Dr Evil type consiracy theory - I just mean that market's normal actions have been impaired whether deliberately or inadvertantly by policy actions

Case-Shiller currently suggests that values are 30-40% above their log normal trend but a longer term line graph of nominal values looks even more alarming extraoplate the trend pre 70s and the mean reversion looks like 50% +

I've made a graph (not one of my skils) but I can't get it to upload - I can email to anyone who wants it (maybe someone could format the data and upload better than I know how???)

But USG can continue to out a floor in place and this would stifle the market for the enxt 20-30 years by preventing it ever reaching real value and waiting for demand to exceed people's reluctance to buy an artificially priced asset a la Japan

Well Siamamerican did confuse matters by stating first that prices were 10% above their 'bottom' and then later clarifying it to state he meant 10% above their long term 'mean' which is a very different thing.

Case Shiller index definitely points to a higher overvaluation than 10% from mean but as an index it is rather bias in its methodology. It uses 'repeat sales' of 'single family homes' which I suspect underestimates the fall by not including 'condos' or 'off plan builds'.

And of course if you wish to obtain a sustainable rise in home prices it is a good start to have prices undervalued in the first place rather than manipulating interest rates to unsustainably low levels and buying MBSs.

[siamamerican]

I might have got it wrong on US property. I've invested heavily in real estate last year and follow the trends. What am I missing - please point me toward the data that shows US property is not close to 10% of the mean(inflation adjusted) of the last 30, 50 ... years. Actually sold all my real estate a couple months back so possibly my estimation is not well grounded.

It's impossible to say what the real value of US real estate is because the market has been price manipulated by the money supply for around 100 years now and also is now subject to the additional manipulation of the floor imposed by USG buying/guaranteeing over $ 5 Trn of MBS and other mortgage vehicles. When I say manipulated I don't mean some weird Dr Evil type consiracy theory - I just mean that market's normal actions have been impaired whether deliberately or inadvertantly by policy actions

Case-Shiller currently suggests that values are 30-40% above their log normal trend but a longer term line graph of nominal values looks even more alarming extraoplate the trend pre 70s and the mean reversion looks like 50% +

I've made a graph (not one of my skils) but I can't get it to upload - I can email to anyone who wants it (maybe someone could format the data and upload better than I know how???)

But USG can continue to out a floor in place and this would stifle the market for the enxt 20-30 years by preventing it ever reaching real value and waiting for demand to exceed people's reluctance to buy an artificially priced asset a la Japan

Thanks for the PM. I took a look at the link and it is based on the same info I used to determine real estate is about 10% above the mean value over the last 30-50 years. The graph you sent me is not adjusted for inflation. If you graphed the nominal cost of a can a coke it would look similar. I've included two links below that use the same data from your link and adjust it for inflation. It looks to be still 8-15% above the average value(actually median).

http://mysite.verizon.net/vzeqrguz/housingbubble/

http://www.realestatedecline.com/homepricehistory.htm

I really don't know exactly where the bottom is and also have no idea when the real estate market will recover. I simply look at the numbers in lieu of a crystal ball and try to make rational decisions. For example, if I based my future real estate investment decisions on Japan, I would probably never put money in real estate. Real estate is cyclical and it always will be. The numbers tell me we are near a bottom and there are buying opportunities.

[siamamerican]

Well Siamamerican did confuse matters by stating first that prices were 10% above their 'bottom' and then later clarifying it to state he meant 10% above their long term 'mean' which is a very different thing.

No, I stated the same thing in both posts. I could have worded it much better but I didn't later clarify that I meant the mean because I had already stated it in both posts.

1st post:

In my opinion, the real estate market will return to the mean value over the last 50 years, which puts us at about 10% ( inflation adjusted) from the bottom.

2nd post:

US property is not close to 10% of the mean(inflation adjusted) of the last 30, 50 ... years

[Gambles]

I might have got it wrong on US property. I've invested heavily in real estate last year and follow the trends. What am I missing - please point me toward the data that shows US property is not close to 10% of the mean(inflation adjusted) of the last 30, 50 ... years. Actually sold all my real estate a couple months back so possibly my estimation is not well grounded.

It's impossible to say what the real value of US real estate is because the market has been price manipulated by the money supply for around 100 years now and also is now subject to the additional manipulation of the floor imposed by USG buying/guaranteeing over $ 5 Trn of MBS and other mortgage vehicles. When I say manipulated I don't mean some weird Dr Evil type consiracy theory - I just mean that market's normal actions have been impaired whether deliberately or inadvertantly by policy actions

Case-Shiller currently suggests that values are 30-40% above their log normal trend but a longer term line graph of nominal values looks even more alarming extraoplate the trend pre 70s and the mean reversion looks like 50% +

I've made a graph (not one of my skils) but I can't get it to upload - I can email to anyone who wants it (maybe someone could format the data and upload better than I know how???)

But USG can continue to out a floor in place and this would stifle the market for the enxt 20-30 years by preventing it ever reaching real value and waiting for demand to exceed people's reluctance to buy an artificially priced asset a la Japan

Thanks for the PM. I took a look at the link and it is based on the same info I used to determine real estate is about 10% above the mean value over the last 30-50 years. The graph you sent me is not adjusted for inflation. If you graphed the nominal cost of a can a coke it would look similar. I've included two links below that use the same data from your link and adjust it for inflation. It looks to be still 8-15% above the average value(actually median).

http://mysite.verizon.net/vzeqrguz/housingbubble/

http://www.realestatedecline.com/homepricehistory.htm

I really don't know exactly where the bottom is and also have no idea when the real estate market will recover. I simply look at the numbers in lieu of a crystal ball and try to make rational decisions. For example, if I based my future real estate investment decisions on Japan, I would probably never put money in real estate. Real estate is cyclical and it always will be. The numbers tell me we are near a bottom and there are buying opportunities.

Thanks Siam,

Case-Shiller is an inflation(CPI)-adjusted index and that implies 30-40%

I don't think that CPI applies to property though - hence my comments that if you extrapolate specific property price inflation from the 70 or 80 years following 1890, you end up with a far greater fall required to revert to mean

In terms of value near a bottom - only a false bottom which would see no capital appreciation for a very long period

[Gambles]

In fairness to Siam's argument - CPI adjusted mean reversions based on varying data periods - (just done these in a hurry so E&OE)

PeriodFall Required to revert to mean40 years10.77%60 years15.34%80 years24.84%100 years30.54%120 years31.00%Weighted Average25.28%

BUT this is based on CPI-adjusted numbers which are not neccessarily appropriate to housing........

AND above all US property is supported by an artificial floor which means that either

1) the floor will hold but also act as a ceiling for a protracted period

2) the floor will be removed and housing prices will once again plummet to real (unmanipulated) value

[midas]

By all means, don't buy stocks in companies you don't trust. Put all your money in a hole if you don't trust banks.

OK.............I want to invest in stocks in home safe manufacturers

Merrill Used Same Alleged Fraud as Goldman, Bank Says

http://www.bloomberg.com/apps/news?pid=206...lghjc&pos=7

[siamamerican]

In fairness to Siam's argument - CPI adjusted mean reversions based on varying data periods - (just done these in a hurry so E&OE)

PeriodFall Required to revert to mean40 years10.77%60 years15.34%80 years24.84%100 years30.54%120 years31.00%Weighted Average25.28%

BUT this is based on CPI-adjusted numbers which are not neccessarily appropriate to housing........

AND above all US property is supported by an artificial floor which means that either

1) the floor will hold but also act as a ceiling for a protracted period

2) the floor will be removed and housing prices will once again plummet to real (unmanipulated) value

My mistake, I re-looked at the numbers a second time after posting and realized they weren't nominal. Different from the numbers I used to make my analysis but too many ways to look at the data to determine which numbers are more legit. Basically, using your numbers, the market is 11% over valued going back 40 years and 15% going back 60 years. In the end the your calcs using a different number set, result is roughly the same percentages.

I agree with points 1 & 2 above. What makes me worry is that all the media pundits seem to agree also. Following their advice the last few years would not have ended well. Do you remember how just 6 months ago they were all forecasting slow growth and equity appreciation the next few years. Everyone was ridiculing the thought of a "V" shape recovery. Their record the prior 18 months was even worse.

I've learned to ignore the hype and focus on the numbers which puts me at an advantage over many investors. Then again my returns could very well be just product of my good fortune.

[siamamerican]

By all means, don't buy stocks in companies you don't trust. Put all your money in a hole if you don't trust banks.

OK.............I want to invest in stocks in home safe manufacturers

Merrill Used Same Alleged Fraud as Goldman, Bank Says

http://www.bloomberg.com/apps/news?pid=206...lghjc&pos=7

Nice to see you progressing. You looked at the negative and forecast a positive investment outcome. Now, put your money into home safe manufacturer or a distributor.

As for me, I might invest in GS next week. The market has overreacted in my opinion. I need to do some more research but from my less than fully aware position it seems GS participated in some questionably activities. The market is assuming they are guilty. I'm sure it is more complicated than this simple analogy but isn't GS activities similar to brokers/investment firms that sell conflicting products to different clients. When I invest, I never assume that all parties have my best interests in mind. As for an investment firm, I do expect them to carry out my instructions in a like manner as they are handling other clients betting on the opposite outcome.

For arguments sake, let's assume I invest $100k in GS on Monday at market open. Now, let's re-look at that investment in 60 days with one caveat. I will sell at anytime during this period that it is 7% up from the purchase price.

[midas]

As for me, I might invest in GS next week. The market has overreacted in my opinion. I need to do some more research but from my less than fully aware position it seems GS participated in some questionably activities. The market is assuming they are guilty. I'm sure it is more complicated than this simple analogy but isn't GS activities similar to brokers/investment firms that sell conflicting products to different clients. When I invest, I never assume that all parties have my best interests in mind. As for an investment firm, I do expect them to carry out my instructions in a like manner as they are handling other clients betting on the opposite outcome.

For arguments sake, let's assume I invest $100k in GS on Monday at market open. Now, let's re-look at that investment in 60 days with one caveat. I will sell at anytime during this period that it is 7% up from the purchase price.

Wow you are a brave person

“ I'm sure it is more complicated than this simple analogy but isn't GS activities similar to brokers/investment firms that sell conflicting products to different clients “

But I don’t believe your interpretation is as simple as this or correct from a legal viewpoint ?

“ Unlike those enraged at seeing their tax dollars fund the Wall Street bailout, Goldman's customers don't care a whit about the fact that monies paid to save teetering insurance giant AIG ended up in Goldman's pockets. Or that the investment bank continues to pay its employees a king's ransom. More like the opposite: no one wants to do business with a loser, and Goldman is anything but.

But winning is one thing and lying is another. What the SEC has accused Goldman of is outright lying to certain of its customers in order to curry favor with others. According to the SEC complaint, Goldman told buyers of a package of mortgage securities that an "independent, objective third party" selected its contents.

Alas, it was not the case. They were chosen by another -- and more favored -- client, hedge fund manager John Paulson. And he chose them because they he wanted a package of mortgages that would implode. And implode they did. “

[Gambles]

I've learned to ignore the hype and focus on the numbers which puts me at an advantage over many investors.

Smart call - but first you have to find which numbers you can trust!!!

[Gambles]

As for me, I might invest in GS next week. The market has overreacted in my opinion. I need to do some more research but from my less than fully aware position it seems GS participated in some questionably activities. The market is assuming they are guilty. I'm sure it is more complicated than this simple analogy but isn't GS activities similar to brokers/investment firms that sell conflicting products to different clients. When I invest, I never assume that all parties have my best interests in mind. As for an investment firm, I do expect them to carry out my instructions in a like manner as they are handling other clients betting on the opposite outcome.

For arguments sake, let's assume I invest $100k in GS on Monday at market open. Now, let's re-look at that investment in 60 days with one caveat. I will sell at anytime during this period that it is 7% up from the purchase price.

if that's your conviction then worth looking at Leaps ??? I haven't checked them - just an intuitive thought but the market might have got there first

[siamamerican]

As for me, I might invest in GS next week. The market has overreacted in my opinion. I need to do some more research but from my less than fully aware position it seems GS participated in some questionably activities. The market is assuming they are guilty. I'm sure it is more complicated than this simple analogy but isn't GS activities similar to brokers/investment firms that sell conflicting products to different clients. When I invest, I never assume that all parties have my best interests in mind. As for an investment firm, I do expect them to carry out my instructions in a like manner as they are handling other clients betting on the opposite outcome.

For arguments sake, let's assume I invest $100k in GS on Monday at market open. Now, let's re-look at that investment in 60 days with one caveat. I will sell at anytime during this period that it is 7% up from the purchase price.

Wow you are a brave person

“ I'm sure it is more complicated than this simple analogy but isn't GS activities similar to brokers/investment firms that sell conflicting products to different clients “

But I don’t believe your interpretation is as simple as this or correct from a legal viewpoint ?

“ Unlike those enraged at seeing their tax dollars fund the Wall Street bailout, Goldman's customers don't care a whit about the fact that monies paid to save teetering insurance giant AIG ended up in Goldman's pockets. Or that the investment bank continues to pay its employees a king's ransom. More like the opposite: no one wants to do business with a loser, and Goldman is anything but.

But winning is one thing and lying is another. What the SEC has accused Goldman of is outright lying to certain of its customers in order to curry favor with others. According to the SEC complaint, Goldman told buyers of a package of mortgage securities that an "independent, objective third party" selected its contents.

Alas, it was not the case. They were chosen by another -- and more favored -- client, hedge fund manager John Paulson. And he chose them because they he wanted a package of mortgages that would implode. And implode they did. “

I just read the complaint. Not as simple as I first thought. Definitely a risky investment that I won't be making with my real money. I'll still be brave with my fictional cash and place the investment on Monday. My bet is that I will still be up in 60 days. GS is well run company and I hope this is an isolated occurrence.

You are correct - my simple analogy doesn't match the charges.

Edited April 18, 2010 by siamamerican

[midas]

I just read the complaint. Not as simple as I first thought. Definitely a risky investment that I won't be making with my real money. I'll still be brave with my fictional cash and place the investment on Monday. My bet is that I will still be up in 60 days. GS is well run company and I hope this is an isolated occurrence.

You are correct - my simple analogy doesn't match the charges.

I think a big problem for GS is that they may be swamped by lawsuits - GS lawyers will make a fortune

Now Germany May Go After Goldman Sachs For Duping One Of Its Banks

http://www.businessinsider.com/now-germany...ts-banks-2010-4

and this comment in another article :-

“ At issue is not whether Goldman would lose a civil case -- at issue is reputational damage, and the opportunity for others who lost money to reason: well, if the SEC has grounds to sue, then so do we.”

[Gambles]

I just read the complaint. Not as simple as I first thought. Definitely a risky investment that I won't be making with my real money. I'll still be brave with my fictional cash and place the investment on Monday. My bet is that I will still be up in 60 days. GS is well run company and I hope this is an isolated occurrence.

You are correct - my simple analogy doesn't match the charges.

I think a big problem for GS is that they may be swamped by lawsuits - GS lawyers will make a fortune

Now Germany May Go After Goldman Sachs For Duping One Of Its Banks

http://www.businessinsider.com/now-germany...ts-banks-2010-4

and this comment in another article :-

" At issue is not whether Goldman would lose a civil case -- at issue is reputational damage, and the opportunity for others who lost money to reason: well, if the SEC has grounds to sue, then so do we."

they were almost wiped out when they got badly caught with their hands in the cash drawer in 1929 (the GS Trading Corp was the uncannily direct equivalent in its day of the CDO scam 80 years later) but somehow survived and came back bigger and badder although it took 40 years of penitence by Sidney Weinberg - although it's worth noting that despite his upstanding reputation even the late gentleman wasn't above using the GS blueprint of ingratiation with The White House

[Abrak]

I just read the complaint. Not as simple as I first thought. Definitely a risky investment that I won't be making with my real money. I'll still be brave with my fictional cash and place the investment on Monday. My bet is that I will still be up in 60 days. GS is well run company and I hope this is an isolated occurrence.

You are correct - my simple analogy doesn't match the charges.

Well whether you make money or not I have no idea.

But if you do it will not be because it is an 'isolated occurrence'.

Let's face it they are bunch of guys trying to make as much money possible, through whatever means and influence. Now I cant argue that it isnt a cause worth backing with your bucks. For all I know they will extricate damages out of this accusation (which is of course totally unfounded especially if you exclude all the evidence.)

Who ya gonna call!! Ghostbusters!!

[sokal]

By all means, don't buy stocks in companies you don't trust. Put all your money in a hole if you don't trust banks.

OK.............I want to invest in stocks in home safe manufacturers

Merrill Used Same Alleged Fraud as Goldman, Bank Says

http://www.bloomberg.com/apps/news?pid=206...lghjc&pos=7

Nice to see you progressing. You looked at the negative and forecast a positive investment outcome. Now, put your money into home safe manufacturer or a distributor.

As for me, I might invest in GS next week. The market has overreacted in my opinion. I need to do some more research but from my less than fully aware position it seems GS participated in some questionably activities. The market is assuming they are guilty. I'm sure it is more complicated than this simple analogy but isn't GS activities similar to brokers/investment firms that sell conflicting products to different clients. When I invest, I never assume that all parties have my best interests in mind. As for an investment firm, I do expect them to carry out my instructions in a like manner as they are handling other clients betting on the opposite outcome.

For arguments sake, let's assume I invest $100k in GS on Monday at market open. Now, let's re-look at that investment in 60 days with one caveat. I will sell at anytime during this period that it is 7% up from the purchase price.

I would just sell some puts on GS if I was interested in investments like this. Sell at 3 different strike prices.

[midas]

I just read the complaint. Not as simple as I first thought. Definitely a risky investment that I won't be making with my real money. I'll still be brave with my fictional cash and place the investment on Monday. My bet is that I will still be up in 60 days. GS is well run company and I hope this is an isolated occurrence.

You are correct - my simple analogy doesn't match the charges.

Well whether you make money or not I have no idea.

But if you do it will not be because it is an 'isolated occurrence'.

Let's face it they are bunch of guys trying to make as much money possible, through whatever means and influence. Now I cant argue that it isnt a cause worth backing with your bucks. For all I know they will extricate damages out of this accusation (which is of course totally unfounded especially if you exclude all the evidence.)

Who ya gonna call!! Ghostbusters!!

I wonder if evidence includes possible " pillow talk "

BUT WAIT, THERE'S MORE: Head Of Allegedly Swindled Goldman Buyer ACA Is Married To Goldman's Deputy General Counsel

Read more: http://www.businessinsider.com/henry-blodg...4#ixzz0la0WLiDo

[lannarebirth]

So I'm reading about "Oil "plunging" on volcano and Goldman jitters". Here's my takeaway. A plunge sure ain't what it used to be and news is for suckers.

[zorro1]

The Dow dropped sharply on Friday to test short-term support at 11000. Failure would signal a larger correction back to support at 10700. Twiggs Money Flow (21-day) retreat below 10% would confirm. The long-term target for the breakout remains 12000*; with reversal below primary support at 9900 unlikely.

[zorro1]

A usa bank gets a slap on the wrist and we get a kick in the bum. Goldman Sachs shares up 1.6% last night. You have to wonder how much of this is orchestrated

[flying]

You have to wonder how much of this is orchestrated

No need to wonder....It is all orchestrated

[zorro1]

Flying, Thats about right. I don't want to be a retail mushroom anymore. I want inside info too!