Author: stlplace

Categories
Business

Amazon and Jeff Bezos

Reading Time: < 1 minute

Saw this from Yahoo Tech-ticker. While I would not necessarily compare Amazon/Bezos to Apple/Jobs, I admire Amazon the company and Bezos as a business leader. That being said, the stock (Nasdaq: AMZN) is still not cheap, with a PE (ttm) about 40. As a customer, some of the features I like about Amazon over the years include: suggestions “you may also like”; user reviews (5 stars); over $25 free shipping; wish list. As a techie (and analyst) I like Amazon’s investments in cloud computing a few years back (when this thing was not as popular as today). It seems their investments will pay off over time.

Continue reading “Amazon and Jeff Bezos”
Categories
Stocks

Chesapeak Energy CHK: hedge fund or natural gas producer ?

Reading Time: < 1 minute

A while back I bought some Chesapeak Energy stock (NYSE:CHK) after it dropped from high of $75 to around $50, I knew its Q2 2008 results are not good because of its hedging loss. The following was an interview of its CEO McClendon on CNBC on Aug 19.

Continue reading “Chesapeak Energy CHK: hedge fund or natural gas producer ?”
Categories
401k and Personal Finance Investing

What to DO and NOT_TO_DO in this market?

Reading Time: < 1 minute

NOT TO DO list first
1) Watch CNBC and other financial news and got confused, and worse got panic. Same goes to checking your brokerage acct or 401k acct every day;

2) Try to be the hero: pick up “cheap” financials, commodities, technology stocks simply because you think they are “cheap” compared to 2 weeks ago (without any own research);

3) Sold all the stock fund postions in 401k, and put it to cash. The chance is you will not be able to buy them back at the bottom;

4) Put the Greenbacks under your mattress 🙂

Things to do
1) Have some emergency cash and credit line (credit card and HELOC if possible);

2) Do the homework: reading words of Buffett and Munger (my list here). Find some quality name we can understand (or model using Munger’s word). I am thinking AMZN, RIMM now, not buying just watching. When the dust settles, and I have some free money, I will buy them at bargain price;

3) Continue to contribute to 401k, IRA: depends on your risk tolerance, put it in bond or stock funds you have trust in management.

Categories
Investing

Wall Street’s Shadow Market by CBS

Reading Time: < 1 minute

I am a big fan of CBS 60 minutes. This weekend it explains the Credit Default Swap (CDO) market, and how it backfired and brought down the Bear, Lehman, and AIG. One nice thing about this CBS video (link here), is one does not need formal finance education to understand it. The video lasts 12 min.

Continue reading “Wall Street’s Shadow Market by CBS”
Categories
Economy

What recession?

Reading Time: < 1 minute

Maybe things are not as bad as it seems. This afternoon we visited West County mall to check out things. We have not been to the malls for quite a while.

Apple Store
At the Apple store, I saw a big crowd as usual. This made me wondering: what recession? Although I am happy with my 2nd gen iPod Nano (refurbished), and have no plan to buy iPhone, I am sure there are plenty of people checking out the MacBook, new iPod Nano etc.

Maybe all these recession and 1930 depression talk was to get Congress pass the $700 b rescue bill?

Warning: don’t jump into AAPL stock simply from my observation. You could get hurt badly and I could not help you. Also, I don’t think we can judge the soundness of economy just by going to one mall. We need more economy and market data: job, interest rate, stock market and most importantly the credit market.

Categories
Master Series

Buffett talked about rescue plan on Charlie Rose

Reading Time: < 1 minute

Here is the Google video. He also talked about the financial crisis, human psychology in terms of bubble, herd mentality etc. which is my favorite part (but I have to admit I am one of the herd). The interview last about 54 min.

Continue reading “Buffett talked about rescue plan on Charlie Rose”
Categories
China

China Mobile Group got robbed

Reading Time: 2 minutes

According to Chinese news, China Mobile’s ultimate parent, the China State Asset Management Co. (CSAM), took 50 billion Chinese Yuan (about 7.30 billion USD) from China Mobile Group (the parent of China Mobile Limited, NYSE: CHL; HKSE:0941), and gave it to China Telecom. For CSAM, this is merely put money from left pocket to right pocket, because both China Mobile and China Telecom are majority owned by CSAM. But for CHL shareholder like me, this is merely another highway robbery, orchestrated in the name of “balance of power in China telecom industry”.

China Mobile Limited CHL

Continue reading “China Mobile Group got robbed”
Categories
Investing

Stock lesson VIII: WaMu fiasco

Reading Time: 2 minutes

Think you are unlucky being US tax payer, paying $700 billion to bail out wall street. Think the poor Washington Mutual (NYSE: WM) shareholder and bond holder, they are left with almost nothing.

And yours truely, after been in the US stock market for almost 5 years, is one of the WM shareholders. Looking back, this is a mistake largely self made and I could avoid it if I used more brain a bit more. Here was my rationale and how I did it:

Continue reading “Stock lesson VIII: WaMu fiasco”
Categories
Life Tips

What’s your favorite gas station?

Reading Time: < 1 minute

I used to go to Shell gas station. One reason is when I started to driving in 1998, I heard from fellow graduate students that “Shell gas is the best”. Another reason is there is a Shell gas station near my home.

But after I tried the BP (British Petrolum, formerly Amoco) station lately, I changed my mind. It seems to me BP invigorate gas lasted longer than the Shell gas, at least to my 2001 Nissan Altima. I guess it could be one time thing, as BP invigorate contains some additives to clean up the engine, which the Shell could not do for some reason.

Bottom line is, I am going to try it for a while, and see if this effect lasts.

BP invigorate performance pic

Categories
401k and Personal Finance

What’s your leverage ratio?

Reading Time: 2 minutes

I think I found the root cause of this whole financial crisis, just like the Wall Street investment banks, hedge funds, AIG (NYSE:AIG), Washington Mutual (NYSE:WM), the problem is American home buyers/consumers are overly leveraged. Note I used the word home buyers, not owners, because theoritically the banks (oh, to be precise, the Chinese, the Japanse…) owned the mortgages, most American buyers put very little downpayment. This problem is not isolated to the home mortgages, it has been extended to the auto loans and cosumer credit too. So I would not be surprised to see if those two things blow up in the near future.

This also bring an interesting question, related to the current heated debate on the bailout bill: Paulson (aka King Henry) does not want any string attached to his bailout plan, arguing that wihtout bailout the credit market will collapse and we will be all worse off; Democrats argues that we need to bailout the home owners (oh buyers, or speculators) too at the same time we bailout the wall street.

The bottom line is: we are both overly leveraged. While I saw the Lehman Brothers has 40:1 asset/equity ratio, what’s the American consumers leverage ratio? I remember more than 7 years ago I bought a car with zero downpayment, that’s an infinite leverage ratio. Seriously speaking, I think the old rule 3:1 for buying a house should still apply: in others words, people should buy a house about 3 times gross income. OK, I am talking about the solvency measurement here.

The aftermath of bailout

Continue reading “What’s your leverage ratio?”