Archive for December 2013

New Year’s Open Thread (and Ed’s Daily IRA Summary)   12 comments

My IRA managed to beat the indexes today:

BIDU: 3.89 to $177.88 ( 2.24% , 14.76% overall)–bought at $155.00
GNW: 0.10 to $15.53 ( 0.65% , 65.74% overall)–bought at $9.37
GWPH: 1.15 to $41.54 ( 2.85% , 26.07% overall)–bought at $32.95
NDZ: -0.01 to $8.49 ( -0.12% , 0.83% overall)–bought at $8.42
NNVC: -0.14 to $4.80 ( -2.83% , 88.98% overall)–bought at $2.54
PVCT: 0.09 to $2.41 ( 3.88% , 159.14% overall)–bought at $0.93
YHOO: 0.24 to $40.44 ( 0.60% , 67.45% overall)–bought at $24.15

OVERALL: +0.63%

With the markets closed until Thursday, I offer you the perfect New Year’s Eve music, courtesy of my favorite songs from the Pointer Sisters:

1. I’m So Excited (released in 1982, re-released in 1984): One of the all-time great party songs. A great bouncy tune with lyrics to match.

2. Neutron Dance (1984): This is a subjective favorite of my mine. Neutron Dance is just a bit more fun in my opinion than better-known songs like Automatic or Jump. By the way, if you like Neutron Dance, I would also recommend Be There, from the Beverly Hills Cop II soundtrack.

3. Fire (1978): Originally written by Bruce Springsteen for Elvis Presley, the Pointer Sisters nailed this song. It is one of their few 70’s songs that I still enjoy today.

Happy New Year’s folks! Let’s come back next year and do it again!

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Posted December 31, 2013 by edmcgon in Music, Open Thread, Portfolio

Traders Corner   Leave a comment

Expect more yawn-inducing action today, as the markets seem to be on auto-pilot. However, I am tempted to get some UPRO for Thursday’s first trading day of the year, which should see some good action.

The S&P 500 levels to watch today:

UPSIDE: 1844 (December 27th’s high and the all-time high), and 1849 (top of the Bollinger Bands).
LAST CLOSE: 1841, in the 1841-1842 (3 data points) range.
DOWNSIDE: 1838 (December 30th’s low), 1833-1834 (2 data points), 1828-1829 (2 data points), 1822-1823 (2 data points), 1810-1813 (5 data points and November’s high), 1808 (December 10th’s high), 1806 (2 data points), 1805 (20 day moving average), 1792-1803 (8 data points), 1786-1788 (3 data points), 1784 (50 day moving average), 1779-1783 (5 data points), 1777 (2 data points), 1775 (October’s high), 1772 (2 data points), 1767 (December 18th’s low), and 1762 (bottom of the Bollinger Bands).

Posted December 31, 2013 by edmcgon in Daytrading, Investing, Market Analysis, Technical Analysis

2013 Awards: Ed’s Daily Notes for New Year’s Eve   13 comments

The news is light this morning, so I decided to offer my final awards post for 2013.

Snowden(hat tip to NPR for the pic)

PERSON OF THE YEAR: Edward Snowden. Too often, we get caught up in the argument of whether Snowden was a traitor to the U.S. or not. The better question is: Is the NSA too powerful? My answer is yes, since it clearly violates the Constitution’s 4th Amendment. But even if there were no 4th Amendment, I would still say yes, because the kind of metadata which the NSA has been collecting is far too dangerous to have in one place, under one government. Even former East German citizen and current German Chancellor Angela Merkel was on the money when she compared the NSA to the old Stasi.

But all the questions surrounding the NSA wouldn’t be getting asked, if not for Snowden. Sometimes, we need to be reminded of what freedom truly means. Snowden gave us that wake-up call, and for that, he is my person of the year.

Gravity

MOVIE OF THE YEAR: Gravity. It is rare in these days to see a deep science fiction film, even though that is the main purpose of science fiction: To reflect on the human condition. Gravity was that rare gem. I can even forgive some of the liberties the film took with where certain space stations were orbiting, because it fulfilled the main purpose of science fiction. Extra kudos for Sandra Bullock, who pulled off a very challenging role. In addition, I would call her my actor/actress of the year.

Obamacare

SCREW-UP OF THE YEAR: Obamacare. This is one of those awards that names itself. Even if Obamacare gets fixed in the next year, and I have strong doubts, the roll-out has been an unmitigated disaster, which even the most partisan of Democrats can’t deny. Take your pick from this smorgasbord of flaws: The website (both the functionality and the security), the cancelled policies that weren’t supposed to be cancelled, the large numbers of people added to Medicaid (at a time when the U.S. government can’t afford it), and the selective enforcement of Obamacare regulations (individual mandate is still on, but the business mandate is delayed a year). And those are just the obvious problems!

Posted December 31, 2013 by edmcgon in Editorial/opinion, Movies, News, Politics

December 26-30th: Ed’s Daily IRA Summary   Leave a comment

Today, I am playing catch-up with my IRA results.

First, here are the results for my IRA holdings from last Thursday and Friday:

BIDU: 5.19 to $173.77 ( 3.08% , 12.11% overall)–bought at $155.00
GNW: -0.12 to $15.51 ( -0.77% , 65.53% overall)–bought at $9.37
GWPH: 1.86 to $37.75 ( 5.18% , 14.57% overall)–bought at $32.95
NDZ: -0.04 to $8.49 ( -0.47% , 0.83% overall)–bought at $8.42
NNVC: -0.05 to $5.04 ( -0.98% , 98.43% overall)–bought at $2.54
PVCT: 0.12 to $2.18 ( 5.83% , 134.41% overall)–bought at $0.93
YHOO: -0.36 to $40.49 ( -0.88% , 67.66% overall)–bought at $24.15

And from today:

BIDU: 0.22 to $173.99 ( 0.13% , 12.25% overall)–bought at $155.00
GNW: -0.08 to $15.43 ( -0.52% , 64.67% overall)–bought at $9.37
GWPH: 2.64 to $40.39 ( 6.99% , 22.58% overall)–bought at $32.95
NDZ: 0.01 to $8.50 ( 0.12% , 0.95% overall)–bought at $8.42
NNVC: -0.10 to $4.94 ( -1.98% , 94.49% overall)–bought at $2.54
PVCT: 0.14 to $2.32 ( 6.42% , 149.46% overall)–bought at $0.93
YHOO: -0.29 to $40.20 ( -0.72% , 66.46% overall)–bought at $24.15

Finally, the overall from all three days:

OVERALL: +1.39%

Posted December 30, 2013 by edmcgon in Open Thread, Portfolio

Traders Corner   8 comments

The technical outlook for the S&P 500 hasn’t changed much in the past week. Friday’s very slight drop moved the technicals only a smidgen. At the moment, the only technicals in overbought territory are the ones which can run for extended periods that way. As long as we remain in low-volume holiday trading mode (the S&P 500 hasn’t traded above 3 billion shares since December 20th), I don’t expect much in the way of technical change.

The S&P 500 levels to watch today:

UPSIDE: 1844 (December 27th’s high and the all-time high and the top of the Bollinger Bands).
LAST CLOSE: 1841, in the 1841-1842 (2 data points) range.
DOWNSIDE: 1833-1834 (2 data points), 1828-1829 (2 data points), 1822-1823 (2 data points), 1810-1813 (5 data points and November’s high), 1808 (December 10th’s high), 1806 (2 data points), 1792-1803 (8 data points and the 20 day moving average), 1786-1788 (3 data points), 1784 (50 day moving average), 1779-1783 (5 data points), 1777 (2 data points), 1775 (October’s high), 1772 (2 data points), 1767 (December 18th’s low), and 1763 (bottom of the Bollinger Bands).

Posted December 30, 2013 by edmcgon in Daytrading, Investing, Market Analysis, Technical Analysis

Ed’s Daily Notes for December 30th   4 comments

I feel much better now. This is good, because we have a big week ahead:

MONDAY-TUESDAY: The last 2 trading days in the month, quarter, and year. I would expect a lot of portfolio juggling by fund managers, with an eye towards moving from unknown small caps into popular big cap stocks.
WEDNESDAY: Markets closed for New Years Day.
THURSDAY: The first trading day of the new month, quarter, and year. Reverse portfolio juggling by fund managers, moving from the big caps back into the small caps.
FRIDAY: Federal Reserve Chairman Ben Bernanke will be speaking Friday afternoon at 2:30 pm EST. The markets may be watching this closely.

On to the news…

Bloomberg: Japan Consumer Prices Seen Rising Five Times as Fast as Wages

Japanese employers will fail in the next fiscal year to heed Prime Minister Shinzo Abe’s goal of wage increases that outpace inflation, highlighting risks that the nation’s recovery will stall, surveys of economists show.

Labor cash earnings, the benchmark for wages, will increase 0.6 percent in the year starting April 1, according to the median forecast in a poll of 16 economists by Bloomberg News. Consumer prices will climb five times faster, increasing 3 percent, as Japan raises a sales tax for the first time since 1997, a separate Bloomberg survey shows.

The squeeze on consumers from higher prices risks undermining public support for Abenomics and dragging on retail spending, unless Abe can convince companies to boost wages to cushion the blow. At stake is sustaining a recovery in the world’s third-biggest economy, set to expand this year at the fastest pace since 2010 as Abe tries to drive an exit from 15 years of deflation.

This is just another nail in Japan’s coffin. From everything I have read, Japan is a slowly dying country, with demographics showing a population doomed to decline for the rest of this century. That kind of population decline can only shrink their economy in the long run. At this point, I consider Japanese investments as strictly optional.

Bloomberg: France’s Hollande Gets Court Approval for 75% Millionaire Tax

John Galt, your flight out of Paris is taking off:

French President Francois Hollande received approval from the country’s constitutional court to proceed with his plan to tax salaries above 1 million euros at 75 percent for this year and next.

Under Hollande’s proposal, companies will have to pay a 50 percent duty on wages above 1 million euros ($1.4 million). In combination with other taxes and social charges, the rate will amount to 75 percent of salaries above the threshold, the court wrote in a decision published today.

“The companies that pay out remuneration above 1 million euros will, as expected, be called upon for an effort of solidarity on remuneration paid in 2013 and 2014,” the Economy Ministry said in an e-mailed statement.

Hollande, who once said he “didn’t like” the rich, announced the 75 percent tax in February 2012 as part of his presidential campaign to appeal to his Socialist base. It has become a symbol of his government’s record-high taxation rate.

A first proposal to put the change into law was turned down by the constitutional court in December last year because the tax applied to individuals and not households. The country’s top administrative court said any rate above 66 percent would be rejected as confiscatory.

Hollande revived the plan this year, making it apply to salaries and be paid by employers rather than individuals. The total amount is limited to 5 percent of a company’s revenue.

Wall Street Journal: Camille Paglia: A Feminist Defense of Masculine Virtues

Camille Paglia is one of those people who I consider a must-read every time an article by her or interview with her is posted. The above interview in the WSJ is no exception. She is a font of wisdom, whose every utterance deserves deep reflection.

Posted December 30, 2013 by edmcgon in Editorial/opinion, Federal Reserve, Market Analysis, News

Weekend Open Thread   2 comments

I decided to take a break from the year-end awards editions of the weekend open thread, mostly because I am in a musical mood. So without further ado, I offer what I consider to be one of the true classics from the 1970’s: I’m Not in Love by 10cc.

From the song’s Wiki:

The ethereal sound was created by laboriously building up multiple overdubs of the voices of Stewart, Graham Gouldman, Godley and Creme singing a single note in unison. This multi-track was then mixed and dubbed down onto 16-track tape. This process was repeated across all 16 tracks to create a lush 256-voice “virtual” choir that could “sing” chromatic chords. A number of these prepared multi-tracks were then cut into several endless loops, each of which contained the basic notes of the main chords used in the song. The chorus loops could then be played by using the mixing desk rather like a keyboard—each chord could be sounded by bringing up the fader for that loop. The instrumental break featured the repeated spoken phrase, “Be quiet, big boys don’t cry…”, spoken by Kathy Warren, the receptionist of their own Strawberry Studios where the band recorded the track.

…In a BBC interview, Eric Stewart told how the song began as a bossa nova version, but was ditched by the band after Kevin Godley and Lol Creme dismissed it as “crap”. Although the band moved on to record “One Night in Paris”, they noticed that studio staff were still walking around singing “I’m Not in Love”. Stewart recalled: “I looked at Graham (Gouldman), and I said that song’s a hit, you know. I don’t know what’s going on here, but I think we got to try it again. And blow me down, Kevin came up with the idea. He said, ‘Let’s do something very different. Now let’s do a whole track and the whole backing track is voices.'”

For the time, what they did to make this song was incredible.

What would it have sounded like with a bossa nova beat? Here is a band named Olive coming close to it:

While I think it is ok, I can see why they would view it as “crap”, especially considering 10cc’s final version.

Aside from the technological accomplishment of the song, part of the song’s appeal is in the lyrics, which masterfully say one thing while meaning the opposite. Psychological denial is a hard thing to write convincingly. I have to give credit to Tori Amos for her cover of the song, which strips it down to bare essentials, and shows the lyrics to be much more disturbing:

On the other hand, this is not a song for everyone. I was completely disappointed by The Pretenders, who brought nothing to the song:

What surprised me is how few “great” singers have covered this song. One of the few I have heard was Queen Latifah:

Finally, the best cover of the song goes to Orleya, a singer whose voice reminds me of Astrud Gilberto (The Girl from Ipanema). Orleya shows the song can work with a smooth jazz sound:

Enjoy your weekend folks!

Posted December 27, 2013 by edmcgon in Music, Open Thread