I like the conspiracy vibe but seriously, a lot of people are involved in establishing the statistics methodology, and they come from both parties and tend to be extremely wonk-ish.
What's in it for them to screw the public? The Fed doesn't put out the inflation numbers.
If you don't like the notion of deflation, can you acknowledge that wages aren't rising very much? And benefits are maxing out or being cut? And total govt spending isn't exactly growing by very much, if at all. So where is the money that is to push prices higher?
How about checking MIT's billion price project. Check for the US and Europe.
If prices are rising so much, what's up with corporate revenues?
So they buy bonds? My pt is that QE has lifted inflation expectations but inflation itself is weak and next year may turn into deflation. What if the wizards of Eccles suddenly appear to be mere mortals, and investors start to doubt in their magical abilities to inspire borrowing and spending.
I am reading a lot of stuff on this board. You guys have to realize that sectors often trade together and in this case it is very tough for TTWO to do much if EA is in free fall. And it is.
Moreoever, we have a disinflation problem. If the market realizes that the Fed is out of bullets to fight deflation and even asset prices start to implode, well, then what?
He is not stupid. On Twitter someone who says Z was his first boss says Z is invariably the smartest guy in any room. For someone who doesn't play video games, he's done a pretty good job of making sure that just about every game that goes out with get decent critical reviews. He's done a nice job managing the finances.
Rusty, for many businesses, stock options are really a problem, pushing executives and peons alike to focus on short term results even at the expense of long term success. Example: yesterday I read about the Return of Home Equity Loans or we can say HEL 2. These loans supposedly had you paying down the coupon only and not the principle until now, and now that payments are rising, people are missing payments. Shocker!
But gaming seems to be one of those businesses in which options are almost necessary to focus the teams of the various studios not on purely making art but on satisfying the customer and creating games that will sell.
So I do find dilution a big problem but I don't know a way around it. Do you? I am just sorry the company couldn't find the gumption to buy back shares using leverage when the stock was $9.
As to the Fed: how confident are you that you know what you are talking about? Do you really think you know enough to criticize Bernanke? I defer to you on deep knowledge of TTWO and I defer to just about anyone regarding gaming, but it seems to me many are too quick to assume they know anywhere near enough to say something about monetary policy and too slow to credit those who have gotten it right in their forecasts time and again. And no one has been a more accurate forecaster than Janet Yellen.
Considering TTWO in isolation--certainly do. What a fantastic deal for patient investors--there aren't many more attractive stocks than this one if the economy stays ok. On the other hand, S&P is up nearly 10% since Oct 9 and that is rather extreme.
My view is that the worldwide risk is not that this rally ends due to the Fed raising rates, but that it ends because the Fed's efforts actually fail to generate sufficient inflation & growth in the face of so many headwinds--like European policies and US budget cuts. We need to get more dollars into the economy and out of bank reserves.
I am bullish on US treasuries. Or at least I think every stock investor should have long term call options on TLT just in case something catastrophic happens that just tanks inflation and growth. US treasuries are the world's only safe haven. I give kudos to the brilliant people at the Fed who have managed to convince people not to hide in treasuries but to go out and invest and try to do stuff with their savings. Post 2008 could've turned out so much worse--and still could. They have a tough tough battle. No general could be better choice than Yellen, though. So it's hard to know what will happen.
When you are one of the world's wealthiest men, you may not be much inclined to think much about your blunders, especially after a bizarrely fortunate year, and Netflix and Herbalife certainly are bizarre situations, but Carl got his ego in the way of making a smart decision with Lion's Gate, and now he's done it again.
Oh, Carl, you didn't get the special dividend at the expense of the company's future flexibility? Awww. Nevermind that the game business can run into dry spells; it's all about "shareholder rights" to you at the expense of other stakeholders if need be, and who really cares about the future anyway? So have a tantrum, set up your ultimatum and get bought out.
For TTWO, this is a wonderful development. The company has decided not to #$%$ away its hard earned cash on a short term dividend to suit one man's greed. It's taken him out and reduced shares outstanding. And it still has plenty of cash on the balance sheet. That's managing for the long run and all stakeholders and most eventualities. No, everything wasn't done perfectly. It would be nice not to have bought back shares so high, but the worst was avoided and the future looks good.
Here's to a successful Agent in 2014.
yes, some jackass has taken a flyer that it will surpass 23. Huge call buying has made it difficult for this stock to advance in recent months. These speculators have lost a fortune and put $ in the hands of market makers big time. Very hard for this stock to get above 18 by Friday's close. Anything's possible but with low volume, small stock, market makers rule the roost.
We need something that makes analysts bump up their 2015 fiscal numbers to put some juice in the stock. It's tough but you have to be patient. Fundamentally if they can get GTA Online to make some money, that would be just magic. Patience and no leverage, because you just can't time it. It could be here in a year's time and then move 10 pts quickly--I've had it happen to me many times.
Better not to think about it. Play a video game or something.
Management doesn't know any more than you or I. They have more than 10 games for next gen consoles no one has even purchased yet. It's impossible to forecast. There's no point to putting credibility on the line. Next year is a transition year. They're learning freemium and they're testing the next gen waters. They're looking for more freemium content to purchase that could be playable on mobile worldwide.
Caveat: if the options buyers are gigantic firms, there is always the possibility that they could crush the options market makers. The market makers are short calls, long stock--but not equally. They are shorter calls. They count on their 20/1 leverage on expiration to bring the stock down to the pin where they don't lose money. But it is possible for market makers to get crushed as well if the options buyer is so big that they can simply power the stock through the strike, causing market makers to panic and start chasing the stock. This can create a feeding frenzy. Insh'allah, as the Iraqis say: god willing. In our secular time and place: "if only".
Between 17 & 18, or 18 on the nose, is the most likely pin on options expiration, as things stand now. Yesterday, sensing disappointment and seeing shares fall, some of those with what were 20,000 calls at the 18 strike, each of which represents 100 shares, started selling. As those options are sold, market makers sell stock they bought to hedge their short call position. It was a wonderful time for TTWO mngment to buy back shares, as they want to do because they have the cash and shares outstanding have grown to over 100,000,000. We dont know if they did, but 11 million shares were trades yesterday: someone bought them.
The idea that Strauss blew the call, that is just flat crazy. He brought big numbers; that's most important. He didn't step on his studios by announcing their games; do you remember Jobs announcing Ipods in conference calls? No. Z knows he has to buy back stock and to what purpose would it be, over the medium term, to blow smoke? He's got as little clue as most of us how his next gen games will do in 2015. We don't even know now how many people will have consoles. His job now is to husband his cash and save his big titles for fiscal 2016 and beyond, when it is clearer how it all plays out w the new consoles plus Valve etc.
If you look at the big picture, TTWO has more quality games than ever, byte by byte things have improved. Fiscal 2016 and beyond, I think this company can earn at least $2.00 a share and pay a 2.5% dividend every year. They will move into mobile, they will improve their overall slate. It's pretty easy to see how this could become a $50 stock in 3 years. That's how you have to look at it.