Congressional resolution could take up to two years......somehow I doubt he has sold any of his preferred holdings and may add more soon. His recent advocacy/activism commentary is running contiguously with his 2 litigious filings against the government.
WSJ of March 10 article by Nick Timiraos entitled Berkowitz: Treasury’s Rationale for Fannie Bailout Fix Is ‘Nonsense’ covers it. It seems hedge fund managers have made decisions based on a set of facts, but that the government has changed horses midstream. Stay tuned.
Two monks were once travelling together down a muddy road.
A heavy rain was falling.
Coming around a bend, they met a lovely girl in a silk kimono and sash, unable to cross the intersection.
"Come on, girl," said the first monk. Lifting her in his arms, he carried her over the mud.
The second monk did not speak again until that night when they reached a lodging temple. Then he no longer could restrain himself.
"We monks don't go near females," he said. "It is dangerous. Why did you do that?"
"I left the girl there,: the first monk said. "Are you still carrying her?"
“The past is already gone, the future is not yet here. There's only one moment for you to live, and that is the present moment”
CGMFX hit that new 5 year high hit today, thanks to new home sales which hit a five-and-a-half year high in January.
18% of the portfolio housing based, i.e., LEN, DHI and TOL were up almost 3% today.....XHB and both ITB up
New home sales rose 2.2 percent compared with January 2013. For all of 2013, sales were the highest since 2008.
However, a separate report on Wednesday showed applications for loans to purchase homes fell 4 percent last week from a week earlier, hitting their lowest level since 1995.
Also, sales of previously-owned homes tumbled to a 1-1/2 year low in January and housing starts recorded their biggest decline in nearly three years last month, according to data last week.
That raised concerns that the sector, which is key to the economy's recovery, was slowing down sharply.
Snow and bad weather is hitting a range of industries and holding down economic growth.
Maybe Heebs is right on the housing pick.......and maybe the polar vortex is now in its last vestiges and that by the Ides of March it will be gone. National Weather Service is predicting as much. Natural gas has taken a hit the past three days on just such speculation...... that warmer U.S. weather will reduce demand for heating fuel.
CGMFX has closed at $40.32 twice recently. Long term I am looking at the bottom part of the pattern that was the massive "Batman" head and shoulders top from the 2008/2009 fiasco.
On appearances $45 (the support level off of the all time highs) might be a good time to vacate this fund, but nobody can be sure just how much more Fed superheros have left to put under the cape.
Next week the new quarterlies come out, somehow one would think Heeb's has tweaked his portfolio somewhat, perhaps flopping banks and that treasury short from the 30/20 percentile mix, and maybe even bumping a new holding into the top 5.
A mere 0,88 percent gain today signifies he is trading something that is not measureable, or in alignment with any possible benchmark for this unusual fund.
I think he likes it that way.
Small gifts Dept:
CGM Realty (1.93%) and CGMFX (1.88%) are listed as two of the 5 day mutual fund leaders @ Barchart.
Mutual Funds - Ranked by 5-Day Percent Change
Daily information as of Fri, Jan 31st, 2014, based on end-of-day data.
Utilities have been the clear leaders as the emerging market debt and currency crisis that is unfolding has had managers looking for a safe haven.
Chrystia Freeland the liberal Canadian author of "Plutocrats: The Rise of the New Global Super-Rich and the Fall of Everyone Else" is a guest once again on Bill Maher talking about the issue of earning a living wage. ....Productivity has gone up 90% yet wages have only gone up only 8% in the past few decades. Income distribution disparity has almost never been greater, and the Super rich are clearly out of step with public opinion.
See Aside: Peter Schiff And Barry Ritholtz Battled Over The Minimum Wage On Last Night's Daily Show, Schiff said some very insensitive things while Ritholtz expressed his ideas in a much more cogent and effective way. Schiff has been a horrible manager losing 60-70% of his clients money taunting gold at the wrong time and being wrong time after time all the while his net worth has grown to 50-70 million.
On the weekly there is a long hollow white candlestick, (smack dab in the middle of the bollinger band) indicating buyers are still in control. The MACD is indecisive but the slow stochastics are still heading down. The RSI is 56.01 which is low, but recovering. The PSAR indicated a sell two weeks ago, yet the Ultimate Oscillator has held the important 50 mark.
A lot of conflicting information, but going back to the 120 day m.a. of $37.45 (which has held thus far) that has held the last 5 times and there is no reason to believe this time is any different.
"Did that reverse after the fed meeting?"
Yes, right at 2 o'clock it dropped a nickel when it was at the high of the day....... the taper news and Ben's farewell may have been too much for bond market participants to handle. :)
Hard to believe that the market can stand on its own feet, especially when people at the lower and middle end are tapped out. You can increase supply all you want but the demand (buyers) just aren't there. Wal-Mart sales and MCD sales are flat/decreasing for several quarters.
well today anyway, his loss was much less than benchmark all things being equal.
The 20% or so in the TYX 30 year treasury short sure must have helped, as it lost 1.36% today. Maybe he has more cash than normal as well. Everything in his ol' port except LEN was down today......no place to hide lately.
Listening to entire GAUCHO album by Steely Dan while eating dinner. A sophisticated jazzy album that has some very tight horns, and pure perfection in a studio band.
Love Donald Fagen's voice as well.
Scratch that italicization......I meant parentheses.
Yes I saw that you were in AA, but it has had a history of doing poorly and I saw no reason to buy it but Apparently, Ford has had this planned out over 5 years for their F-150.
What matters most of course, as always, is what the winning place/preservation of capital trade is to put one's money in NOW, and from quarter to quarter as well as for 2014.
A very good performance today and this quarter by Alcoa on JPM sector upgrade amid tightening supplies.
AA is one of the CYC 30 stocks from which Heeb's can play out his theme of recovery.
Here's the complete list of which he has/had a mere two, which I italicized:
The Cyclical Stock Index (Morgan Stanley) Stock List
AA C CAT CSX DD DE DOW ETN (F) FDX GT HON HPQ IP IR JCI MAS MMM PPG R UTX (WHR) X
CYC is up 16% since mid August, nearly twice that of the SPX.WHR has been up 19% but F down 2% over that period. Ford is one of the auto companies to lead the tin roof rusted movement of better fuel mileage, but higher insurance premiums and mechanics not yet ready to implement top level managements alchemy introduction from metal to tin.
Made a nice red wine based beef soup with onions and mushrooms for the 2nd round of snow from this vortex polarity.
Me sober and spelling the same word wrong twice?
I think not.
Sorry no Souper Bowl ducats this year to spare.
I'm attuned to the N.E. Denver game this weekend. Just think, if the Brownies kept that coach they would have 3 trophies by now.......:)
MS closed the week at a 52 week high. Best we can tell, yes he still has that and C as two top holdings. He has been reluctant to fli out of sectors holding concentrations within sectors for pretty long stretches of time, over a year now, just tweaking by trimming and adding to mainstays with an occasional new face. One thing to watch is European stocks have been valued as unde rowned and their time is due, but Heeb's is US centric, maybe one oddball pick of ,5% would be in his port. One thing I've noticed is the rate of those treasuries change every day, seemingly small but must create quite a ripple for CGMFX.
This is one of those lazy man publications that the sheeple fall back on and interpret as gospel their numbering system that has led many astray over the years.
What they DO NOT do is offer any clues to future performance.
Don Phillips, President of Fund Research at Morningstar, stated:
“The star rating is a grade on past performance. It’s an achievement test, not an aptitude test…We never claim that they predict the future.”
Expense ratios are a much more reliable way to gauge longer term performance.
There is no verifiable track record differentiating 4 or 5 star fund future performance.
Having said that, few if any of you probably read the year old piece by Kevin McDevitt of Mourningstar, who wrote an article reviewing CGMFX, entitled "This fund has made perhaps the most brazen bet of its 15 year existence." Yes it involves fighting the fed, timing and he did have 71% of his portfolio short the general indices in 2005. The article lists/cites a double (or triple) whammy for his triumvirate positioning of housing/banks/treasury short if economic growth falters.
I had to type in ALL instead of 3 months to see on my screen the above captioned old post, so for my hundreds of readers and followers of this fund, just a recap of early buying action on MS: :)
"#1 is running the first half hour., I think this makes 6 times in a row they beat low expectations.......bodes well forFX if it holds these gains through the close.
Headlines always seem to be both wrong/late."
#1 is running the first half hour., I think this makes 6 times in a row they beat low expectations.......bodes well for FX if it holds these gains through the close.
Headlines always seem to be both wrong/late.
"For the first time in 40 years i'm hearing about a fed that's wanted more inflation. i've never heard that before. it can only be positive. when you have an economy with ample surplus capacity, forces that stimulating growth are increasingly different and active. rising prices of stocks. rising price values of homes. the consumer is reliquifying and experience important balance sheet appreciation and the recent spate of negative fears associated with the political brinksmanship over defaultandthe budget -- and the government shutdown. that's behind us. that scared people. we never had a real threat of default before. so now people are free to look at the future. which is really exciting and bright. ken, you have had a great record. you have ridden this bull for all these years. you've ridden this bull this bull cycle. you just nailed it. let me just ask you, if i'm right, i may or may not be right, but if i'm right the fed is going to continue to inflate the money supply, whether that works or not remains to be seen. i think that's their policy. and profits are still rising, albeit slowly, ken. how long does this bull market cycle have left? i get this question all the time. does it have a year? does it have two years? what's your take on this? it will end when the fed has to tighten because we've exhausted our resources. when we're coming up against bottlenecks in the economy and inflationary forces are rising to a level that the fed finds unacceptable. when your inflation rate is 1%, it can move up to 3% or 4% without the fed having to reconsider its easy policy. rarely in the last 40 years have you had an economy where the fed was probably going to be your friend for three or four years and that is a really bullish, important fact.
From Heeb's last Kudlow interview.......
So what's the story line?
Heeb's has for the past year believed that long term monies would flow from bonds of long maturity because the rate that bondholders would be paid to incur the risk of holding in a low interest/low inflation slowly healing world economy continues to chug slowly along would not be worth it. He thinks we will outlast the debt bubbles that are developing, student loan, gov't etc. His housing/bank thesis is the other two parts almost equal to his treasury thesis. As to inflation, owners' equivalent rent of residences, rent of primary residence, electricity, motor vehicle insurance, hospital services, college tuition and fees,were the main culprits, but fuel oil, electronic gadgets, and gas prices have helped to limit inflation.
Theories about the yield curve have to be factored in as well: expectations theories and market segmentation
theory as well as liquidity theory.The pure expectations theory states that investors will hold longer-term maturities if they are offered a long-term rate higher than the average of expected future rates by a risk premium that is positively related to the the term to maturity.
Market Segmentation Theory
The market segmentation theory also recognizes that investors have preferred habitats dictated by the nature of their liabilities. However, the market segmentation theory differs from the preferred habitat theory in that it assumes that neither investors nor borrowers are willing to shift from one maturity sector to another to take advantage of opportunities arising from differences between expectations and forward rates.
The Main Influences of the Shape of the Yield Curve
Empirical evidence suggests that the three main influences on the shape of the Treasury yield curve are (1) the market’s expectations of future rate changes, (2) bond risk premiums, and (3) convexity bias. The convexity bias influence is the least well known of the three influences. The longer the maturity, the more convexity the security has. That is, longer-term Treasury securities have a more attractive feature due to convexity than shorter-term Treasury securities. As a result, investors are willing to pay more for longer-term Treasury securities and therefore accept lower returns. This influence on the shape of the Treasury yield curve is what is referred to as the convexity bias.