stlplaceTo be precise, it’s the G1 phone from T-Mobile, with the “G” software provided by Google. I did not visit the nearest T-mobile store by Panera, but I saw it from T-mobile web site.
The paradigm shift in Smartphone market
About 3 months ago we have seen the debut of iPhone 3G, now with the GPhone from T-Mobile/Google, suddently the smartphone market in the US became crowded, esp. considering we are entering a recession.
BUffett under water
Exelon put a bid for NRG yesterday, a bigger power (utility) for another smaller one, not all that interesting or surprising considering current market condition: the drop of share prices and the freeze of credit market (note the utility companies usually rely on bond market to finance its cap ex). But I saw a small twist: Buffett is still under water on his NRG share purchases, even after the Exelon bid. According to SEC filing, Buffett’s Berkshire Hathaway, bought 3,238,100 shares of NRG at $42.4 per share, in 2Q 2008 (source: gurufocus).
Rouge trader at Citic Pacific
According to Bloomberg, the rouge trader in Citic Pacific, a subsidiary of all-mighty China Citic Group, is going to lose 2 billion USD on un-authorized currency trade. Adding to the injury, the daughter of Citic Chairman Larry Yung (wiki), appears to be involved in the scandal. How many poor Chinese kids can go school with that money???
I am talking about the attention it gets from the presidential candidates, their supporters and the media. We already had the biggest event for Obama (100,000 people) showed up on Saturday at Gateway Arch. Today Monday Oct. 20 we had McCain, he spoke in St. Charles in the morning and will go to Kansas city this afternoon. Last but not least, President Clinton, will speak at Kirkwood high school tonight.
Here is a Google map of Kirkwood high if you are interested.
The big news media, CBS Katie Kouric, CNN John King, are also in St. Louis today. Finanlly the show me state and St. Louis got some national attention 🙂
New York Times Op-ed piece (10/17/08): Buy American. I Am.
Buffett article Fortune Magazine 11/10/2001: Warren Buffett on the Stock Market: What’s in the future for investors
You can read more Buffett and Munger stuff at Warren & Charlie page.
Not endorsing Obama, but it’s interesting to hear a voice from a regular Joe who attended the event. Here is a link if the player below does not work. It is estimated 100,000 people attended the event.
Company web page; Google Finance; Yahoo Finance; quick facts on Trane unit.
2Q 2008 results (Bloomberg), released on Aug 1.
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Ingersoll-Rand Co., the maker of Thermo King and Hussmann refrigeration equipment, said second- quarter profit rose 26 percent after acquiring air conditioner- maker Trane Inc.
Profit from continuing operations climbed to $262.5 million, or 90 cents a share, from $208 million, or 68 cents, a year earlier, matching analysts’ estimates. Sales grew 38 percent to $3.08 billion, the Hamilton, Bermuda-based company said today in a statement.
The results include about three weeks’ worth of sales from Trane. Ingersoll-Rand completed the $9.6 billion purchase June 5, creating a climate-control business that spans refrigerated truck parts, display cases and ventilation systems. The combined company is forecast to post sales of $17 billion this year as Chief Executive Officer Herbert Henkel expands the company’s industrial products after exiting construction machinery.
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Ten years ago I did a bit research on the imbalance of China US trade, for a speech to be given in Public Speech class. The imbalance (US deficit, China surplus) grew significantly in last 10 years, with the American manufacturing jobs moving to China, this is again a hot topic in the election season. Politics aside, we ask the following question again.
Who is benifiting from the China US trade?
I noticed this post from my friend Wang Jianshuo’s blog. I haven’t read the book, but I have heard lots of media coverage on the US on this China trade (mostly negative comments), such as this one (book review, quoted from above) “(this is) essential reading for anyone concerned about how dangerous pet food and clothing manufactured in China make it into American stores…”
Essential? Really? I think for the first part, the author should go to China, visit some plants there, talk to Chinese people, before jump into such one-sided and biased conclusion. Being a Chinese professional who have studied, worked and still live in the US since 1997, I have seen many stuffs made in China, and I believe I have some authority on this matter.
According to cnanalyst: only two were up YTD: VisionChina (VISN) and NetEase (NTES, found by the fellow from my hometown Ningbo).
Here is the list of top 5 and bottom 5. The first percentage number is the percentage change of Year to date. Your truely managed to picked up SPRD from the bottom 5.
Rank Company (Stock Symbol) Year-to-Date Change 10/15/2008 End of 2007
1 VisionChina Media Inc (NASDAQ:VISN) 32.9% 11.30 8.50
2 NetEase.com, Inc. (ADR) (NASDAQ:NTES) 10.3% 20.91 18.96
3 Sohu.com Inc. (NASDAQ:SOHU) -9.3% 49.43 54.52
4 Asia Time Corporation (AMEX:TYM) -11.4% 3.10 3.50
5 eLong, Inc. (ADR) (NASDAQ:LONG) -12.8% 7.22 8.28
……
129 Spreadtrum Communications, Inc. (NASDAQ:SPRD) -87.8% 1.50 12.26
130 China Southern Airlines Limited (ADR) (NYSE:ZNH) -88.3% 7.63 65.46
131 HSW International, Inc. (NASDAQ:HSWI) -88.8% 0.70 6.23
132 LJ International, Inc. (NASDAQ:JADE) -90.6% 0.54 5.72
133 China GrenTech Corporation Limited (ADR) (NASDAQ:GRRF) -90.9% 0.80 8.84
Well, I am not going to short. Two reasons:
1) In order to short a stock, I need to open a margin account, which I dislike. Margin account means I have to borrow from the broker, which increased the risk quite a lot, and increases the “anxiety factor” which is something I dislike. A good example is: someone bought Berkshire Hathaway stock in its early days on margin could get wiped out, because the stock dropped 50% on the way. A more recent example is the CEO of Chesepeake Energy (NYSE:CHK), if we believe the story.
2) So I can not short. Why not buy the puts (or sell the calls)? Welcome to the wonderful world of Options. Well, from my observations (both my own small experiment and others experience), Options are totally different ball game. Basically we are play against time. Options have its expiration dates. While I think in this bear market, the down trend of some stocks are obvious, I have no idea how much the stock price will be at a certain period of time. Remember the old saying “dead cat bounce”. While it’s unlikely a company will use precious cash to buy back stocks these days, it’s likely we will see something like we saw on Monday Oct 10: a 960 points pop on Dow.
So what to do?
Save. Retire some debt. Get some more sleep. Do some research. Buy some fundamentally good stocks at bargain price because I believe the world is not coming to an end 🙂
Macro environment
This morning on my way to work, I found the regular unleaded gas is sold for $2.88 at Shell station near my home. The oil is coming down, amid the slow down of US economy, the No. 1 consumer of the light sweet crude: American consumes 25% of world crude production. Natural gas price is closely tied to the oil price. The Pickens plan, which calls for natural gas powered cars, to reduce the importing of foreign oil, has not gotten too much traction. Neither presidential candiate mentioned much natural gas as a part of the energy solution. The natual gas car is unlikely to happen at least in Detroit, because the car makers financial problems, and the consumers got squzzeed.
The margin call
Again I would not take the margin call of CEO at its face value. The analysis goes like this:
1) If the CEO REALLY sold its stock at margin call, for a company made its name from hedging natural gas production (derivatives trading), it’s like a high school math teacher can not solve primary school math problem. It’s possible, but unlikely.
2) If the CEO sold its stock intentionaly, but publicly declares he sold it out of margin call. He is lying. Again I would not trust him.
It’s more or less like the Bill Clinton 1998, either way his reputation will be tarnished, and people will doubt his judgement for a long long time.