Continuing on the KTCC theme, if have researched correctly of the larger EMS firms (FLEX, JBL, CLS, BHE and PLXS) CLS and PLXS only have one plant in Mexico each. I would consider them buyers of KTCC, while KTCC is down or a China based firm that has no NA operations, that fears losing business, to be a buyer of KTCC.
Still between now and the next earnings report, I expect disappointed growth investors and tax-loss sellers to be net sellers and continue to drive the stock lower as value investors are in no hurry to add inventory. This turnover of the shareholder base may last beyond the next quarterly report if guidance, for the December Q, does not show sequential growth.
mawchek, I haven't bought back the NVTL I sold, but I did buy a spoonful of NUGT today very near the low. I might be premature, but I missed the last leg up by pennies on my limit order so I went ahead and pulled the trigger. I also am holding some WLT that i got at $11, and no, I don't imagine anyone should care much but I'm just trying to operate as openly here as many others generously do... I wish I had some inkling of where WTI is headed. I also wish I had a pony....
I just don't see how 3rd and 4th Qs GDP can accelerate given recent data that suggest job growth, already of low quality, is slowing and high oil prices act as a tax.
Mark Hulbert, in an article today, warned of the return of stagflation-the most recent period was 1966-1981. I posted, several weeks ago, the same warning. Hulbert went on to say that gold and 90-day t-bills were the best inflation adjusted asset classes.
Another theme of my has been the notion that a small event, somewhere in the world, is going to cause a cascading negative series of events. For example there is a smallish bank in Italy, Monte dei Pashi, that needs at 2.5 billion Euro bailout (recap) double estimates of a few weeks ago. If the "solution" is another "bail-in" like what happened in Cyprus, then that could be the little "snowball" that starts the financial avalanche.
FWIW Monte dei Pasci - known locally as Babbo (Daddy) Paschi - has been in business continuously since 1472. Imagine if Great-Great-Great etc. had deposited the equivalent of $100 then at 5% interest... Somebody do the math.
Monte dei Paschi Paschi PASCHI. (Pronounced 'pahski.' I'm a bad typist. Paschi means 'pastures' in Italian. Figuratevi. ('Don't mention it ya'll.')
According to the compound interest calculator I used, $100 compounded at 5% for 541 years is $29,067,708,535,691 (and change). The bank would be sound as long as they treated me nice.
Good luck on your purchases, gulley. Each has its merits.
I haven't repurchased any NVTL either. I'm left with a relatively small tag position I hold as a placeholder to keep my attention. NVTL is in an interesting place. Technically, I like its low/rising RSI position after going sub-30 in August. It's also experiencing a positive MACD cross. Fundamentally, they announced significant expense cuts that will take them toward profitability. My problem with them is management credibility after years of losses and operational underperformance. Can they be trusted? I see their best hope coming from a buyout to unlock value for shareholders. I believe the easy money has already been made.
Some interesting data came out on China earlier this week. Total loans for Aug. almost doubled from July 1.57 trillion Yuan vs 809 billion Y. One may recall attempts by the Bank of China to rein in its "shadow banking" industry by restricting liquidity-sending 7 day repo rates from around 3.5% to 11-12%, but then backed off because the liquidity squeeze put many banks and borrowers in jeopardy..
It is my conclusion that Augusts boom in "shadow" lending is a reliquifying of those "stressed" banks and borrowers. With new liquidity, companies, especially basic industry companies like steel and aluminum are ramping up production and as long as they can sell what they mfger at a higher price than their variable cost they will continue to do so-but still selling at a loss. Evidence of this ramp up are the 10 day steel production numbers out of China and a surge in the Baltic Dry Index.
The problem becomes two fold:
1)If this surge in product is not sold, then it will be an inventory overhang into the 1stH of 2014
2)Zombie banks and companies, kept afloat for now, will have to be dealt with later-perhaps setting up panics in different market scenarios
Are technical trumping fundamentals with NVTL? Up over 11% today on no news while SWIR, a competitor in the M2M space, was down nearly 2%. Interesting to watch this play out over time.
Wondered if you would be so kind to offer your thoughts on ECA going forward? I've purchased over the past two years, quite heavily recently in the 17's to average down to a cost basis of 18.60/share....I've collected the 4+% dividend while I've waited.....Got to believe it is still a buy/hold for a longer term conservative investor??
Many thanks in advance for your thoughts and recommendations over the years
New CEO in a CC today, I have not heard it yet, was suppose to put forth some details of his plans to take advantage of ECA's huge asset base. In a more favorable NG pricing environment, which is coming in the next 6 months to 3 years, ECA is worth $30-$50. Ultimately, if ECA mgt doesn't bring out the value of the balance sheet, then ultimately a buyer will come in and pay close to $30 and do it for their shareholders. I'm thinking XOM, CVX or DVN.
Responded to BB06's post-ECA is my largest $ position and I have bought recently as low as $17.15. Dividend helps, but I expect it will be cut ($.10/Q) to free up cash to invest in ECA's best oily assets.
of why the US is drifting towards the no or little growth economic model of Europe and creating less jobs than it should as a consequence.
What people are paid is a function of 4 factors:
1)The value of the work
2)The ability or performance of the person doing the work
3)The difficulty in replacing that person
4)What you negotiate
Any attempts by government or other non-market forces to influence the rate of pay or the supply and quality of labor will distort the market and net fewer jobs to that geographical location. "4" is interesting in that if labor negotiates too much pay relative to "1-3" then a collapse of the industry is an eventuality. Witness the UAW in recent years (last 40) and the United Steel Workers back in the 1980s and 1990s when dozens of steel companies closed.
This "living wage" #$%$ is a stupid idea, political pandering and I'm surprised more intelligent discussion hasn't been offered up. The collective wisdom of this country is falling-most public schools, liberal universities and press are dummying down the population at large. Eventually it is going to hurt all of us as mendacity and stupidity will be reflected in the value of the $. If current trends continue and they will under the current president, it is simply an eventuality.
Continuing on this theme indirectly-the theme that government interference in markets and the dummying down of America will be reflected in a lower $ over time. What are the investment plays? I'll add another theme to the initial weaker $ theme. As the US "retreats" from Middle East influence and Russia increases, then oil prices will average higher in price than if the US foreign policy was strong- whereas political instability and Russia's largest export being oil will insure that there will be higher oil prices.
The next question becomes, will the next FED president be another Arthur Burns? For those that don't know, you can do some research first on who Arther Burns was. Arthur Burns accommodated higher oil prices, in the mid-late 70s, with faster money supply growth-resulting in the inflationary spiral of the late 1970s.
Weak $, coupled with high inflation will lead to higher oil prices, NG prices catching up-currently 20% of oil prices, should get to 60% of oil prices on a per energy equivalent and gold/silver making new all-time highs. Buy NG, oil, gold and silver-all on weakness-hold for 2-4 years.
Back up to a 10.7% annual rate the last 10 weeks.
Be that as it may, the big question, in my mind, are the broader averages going to have a 15%+ sell off before reaching its ultimate high-probably above 2000 for the S&P 500.
I have been saying "yes" as many European countries continue to be in financial trouble along with China, Japan and a few others-including the US. However, there are tremendous amounts of slack labor and plant capacity around the world. So, if the "credit engines" of Europe and the US x-auto/homes were to kick in-accelerating GDP growth-much of that slack would be absorbed. However, I don't think it happens this round of easing around the world. It will take another "scare" or slow down to get fiscal policies (tax cuts and less regulation) to be pro-growth. In addition, with so much slack and muted inflation, central banks will double down on monetary easing-especially ECB going active QE-that gets the S&P 500 to its ultimate highs.
Until then, it is buying NG, gold/silver on pullbacks and a few special situations.