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Dr. Jones

Dr. Jones

In pursuit of #9
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the corporate buy backs? Clearly the by backs have had a tremendous impact on the increasing DOW.. but when does it end? I think stocks are currently being pushed above worth and MANY companies are buying back their own stocks.. which is a great sign for short term investing.. but what about when the spending stops? When these companies used their cash for stock vs. expansion and R&D?

Guesses?
 
PKM said:
the corporate buy backs? Clearly the by backs have had a tremendous impact on the increasing DOW.. but when does it end? I think stocks are currently being pushed above worth and MANY companies are buying back their own stocks.. which is a great sign for short term investing.. but what about when the spending stops? When these companies used their cash for stock vs. expansion and R&D?

Guesses?
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just looking at this at work.. 95% of my assigned companies significantly increased their authorization last quarter, but their commitments are all relatively short. most gonna spend a couple billi's at least through 2014, at which point aapl may still be sitting on $150b in cash. issue some debt, innovate, stop the yuppie scum. love what ba is doing though, they have like what... $350b of future revenue in their backlog?
 
PKM said:
the corporate buy backs? Clearly the by backs have had a tremendous impact on the increasing DOW.. but when does it end? I think stocks are currently being pushed above worth and MANY companies are buying back their own stocks.. which is a great sign for short term investing.. but what about when the spending stops? When these companies used their cash for stock vs. expansion and R&D?

Guesses?
Click to expand...

Well, unless the companies turn around and try to resell the stocks they bought back, the change should be somewhat permanent... at least as far as those things can go. They've decreased the supply, and increased the demand. Other things could shift the S&D curve sideways, like an overall propensity for the general population to not save as much (ahem) or to start saving and investing more (my fervent prayer).

I dunno. It'll be interesting to see what happens in the next little bit. My company (NASDAQ: SAAS) is having great growth this year, and is most definitely not buying back any stock. But then again, it's a small-cap stock, so I guess that doesn' count.
 
leftyjace said:
Well, unless the companies turn around and try to resell the stocks they bought back, the change should be somewhat permanent... at least as far as those things can go. They've decreased the supply, and increased the demand. Other things could shift the S&D curve sideways, like an overall propensity for the general population to not save as much (ahem) or to start saving and investing more (my fervent prayer).

I dunno. It'll be interesting to see what happens in the next little bit. My company (NASDAQ: SAAS) is having great growth this year, and is most definitely not buying back any stock. But then again, it's a small-cap stock, so I guess that doesn' count.
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can't think of any comp in recent memory who issued more stock after instituting buybacks.
 
take it back, forgot about thermo fisher's announncing their secondary offering, but they are still in the growth stage so it's not entirely unprecedented
 
Right now, is there a safer way to pump up your stock than borrowing money for almost nothing to finance buy backs?

Especially when you're in a fake recovery like we are now. Companies are never going to expand unless they see the economic opportunity to do so. Gov. Christie learned this the hard way after record breaking give aways to corporations and nothing coming back except the 2nd highest unemployment rate in the county.

You take away the cheap money from the FED and buy backs out of the market and what's left? It's a little scary.
 
candrew said:
Right now, is there a safer way to pump up your stock than borrowing money for almost nothing to finance buy backs?

Especially when you're in a fake recovery like we are now. Companies are never going to expand unless they see the economic opportunity to do so. Gov. Christie learned this the hard way after record breaking give aways to corporations and nothing coming back except the 2nd highest unemployment rate in the county.

You take away the cheap money from the FED and buy backs out of the market and what's left? It's a little scary.
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That's where I was going... but there may be just enough fools gold to get over the hump.
 
leftyjace said:
READ and discuss.

https://www.deseretnews.com/article/765631549/AP-survey-Economists-see-no-stock-market-bubble.html

EDIT: yes, this is DesNews, but the article is AP.
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"News" services have been on the take for "pump and dump" operators since the beginning of time. Every crash is preceded in some short term runnup fueled by speculations like this article.

The Fed hasn't been able to sell bonds like they have in the past, and has instead passed out the huge balances of fiat currency with a spending binge in real estate and stock. Yes, "our" Fed, in common with many foreign investors and other sovereign fund managers are "buying America". And they have no exit strategy.

Creativity/innovation/better management/improved productivity can increase values on any corporation or economic sector, and this is still the source of actual strength in the US economy. But the jobs, especially higher-paying jobs still aren't out there, and ultimately the value of a house is referenced to what a payment of about one third of a family's income can "buy" at a current interest rate. Lower interests rates do raise the "value" of a house, and decrease the value of a bond, and enable corporations to operate with less expensive capital and thus increased profit margins justifying higher stock prices.

So how many of you really want the Fed having the power to dictate all that???? You'll never be an "insider" and every bet you make is going to be made/broken with the arbitrary policy "decisions" of some private bankers??????

stocks are probably better than gold or real estate because their value will also rise with inflation, and they are more fluid. . .. lower cost of going in and out. Japan has been locked into near-zero interest rates by political pressures for over twenty years already, and we might be locked into this position just as long, but inflation will happen, and should be your main concern and/or the main basis for your decisions in finance.
 
Zero Hedge was keeping a tally of Tuesdays because that was a particularly heavy scheduled FED(and other central banks) intervention day. The stock market went down this week on Tuesday snapping like a 18 or 19 straight Tuesday's winning streak. That just seems so crazy. It's like....get out of there....and let this thing settle to whatever various private actors deem the value to be. I'd take a billion speculators that are forced to lose their asses if they guess wrong than Fed and government intervention any day.
 
leftyjace said:
Couple that with the lack (or deterioration) in innovation these days, and... hmmmmmmm.
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Don't see how anyone can think this since we're in an innovative boom at unprecedented clips. You can't keep up with the tech advancements these days (medical most impressive IMO). You're just being an angry old white man grump, leftEye. :)

Thought what aapl did was genius, even though I prefer dividends over buybacks under many scenarios.

I've been buying "search for yield" theme for three plus years (way too early). Now that its paying off I've been selling reits. My favorite put up a damn near 25% offering right after I wanted them to, and fully subscribed it. I'm against stock "tips" but will give one if it falls significantly, six years of my history following it included.

I built 1/3rd my folio in Japan following Abe's election--getting crushed the last couple weeks. Will buy more.
 
Also, the market won't fall off a cliff since soooooo many have been left behind and desperately want a correction. There's no place to hide (in bonds).

If I'm wrong, I'm going full margin at Dow 12000 and won't look back.
 
franklin said:
Don't see how anyone can think this since we're in an innovative boom at unprecedented clips. You can't keep up with the tech advancements these days (medical most impressive IMO). You're just being an angry old white man grump, leftEye. :)
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Sorry... I don't know that I meant so much innovation as entrepreneurship.

980525_10151687710773128_1370307123_o.jpg
 
leftyjace said:
Sorry... I don't know that I meant so much innovation as img]
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Oh I definitely agree with that.

I don't look at demographic changes as inherently good or bad. We collectively make individual decisions that can be measured. All I see from your graphs is a bunch of Americans deciding working for the man is the best risk:reward career path. We're in a new world where lots of up front capital is required for worthy profit return. Education is the easiest calculable ROI, since black smithing isn't a viable enterprise any longer.

If entrepreneurship is the measure of success then we can look to the one of the highest per capita countries: Greece.
 
franklin said:
Oh I definitely agree with that.

I don't look at demographic changes as inherently good or bad. We collectively make individual decisions that can be measured. All I see from your graphs is a bunch of Americans deciding working for the man is the best risk:reward career path. We're in a new world where lots of up front capital is required for worthy profit return. Education is the easiest calculable ROI, since black smithing isn't a viable enterprise any longer.

If entrepreneurship is the measure of success then we can look to the one of the highest per capita countries: Greece.
Click to expand...

Cute.

I know you're smart enough that you intended it that way..

Entrepreneurialism has nothing to do with the economic train wreck that is Greece. Greece, used an example, better belongs in the taxes thread (see: out of control SPENDING).
 
PKM said:
Cute.

I know you're smart enough that you intended it that way..

Entrepreneurialism has nothing to do with the economic train wreck that is Greece. Greece, used an example, better belongs in the taxes thread (see: out of control SPENDING).
Click to expand...

The point is there's no reason to freak out over shifting demographics (and politicize the hell out of it). I hear ad nauseam that George W. Antichrist Obama has destroyed the world because labor market participation is declining. As if increasing for fourth or so years could go on forever..

As to Greece, that's more of a rigid currency issue than anything, but the stupid Germans refuse to learn from history. Countries who dump their goods around the globe ALWAYS get theirs (US Great Depression, plaza accord Japan, Soon to be China if they don't adjust faster toward internal dependency). Germany is forcing its neighbors out of work with mercantilism and artificially high currency, and doing everything possible to keep their banks from taking it up the *** on bad bond bets in places like Greece. **** you, Germany.
 
Australia is soon to be one more example. 19% of that economy is mining. Commodities always decrease in cost over the long term and they're banking on this super cycle never ending. China can't build forever, so lookout Australia the future **** hole when 700 million tons of fake ore demand goes down to about 200mt, with a lot coming from recycling just like here.

Lets hope Canadia doesn't go to whoreville along with them.
 
franklin said:
The point is there's no reason to freak out over shifting demographics (and politicize the hell out of it). I hear ad nauseam that George W. Antichrist Obama has destroyed the world because labor market participation is declining. As if increasing for fourth or so years could go on forever..

As to Greece, that's more of a rigid currency issue than anything, but the stupid Germans refuse to learn from history. Countries who dump their goods around the globe ALWAYS get theirs (US Great Depression, plaza accord Japan, Soon to be China if they don't adjust faster toward internal dependency). Germany is forcing its neighbors out of work with mercantilism and artificially high currency, and doing everything possible to keep their banks from taking it up the *** on bad bond bets in places like Greece. **** you, Germany.
Click to expand...

No offense to you, though, Mr. Schroeder.
 
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