Posts tagged dollar

Tuesday September 30, 2008: Bargain hunters rebound stock market.

September 30, 2008 · Filed under business, economy, investing, money, politics, stock market · Tagged , , , , , , , , , , , ,

Everyone loves a bargain.  Yesterday’s loss that evaporated $1.2 trillion from the value of US stocks was just north of half-way made up today by investors scooping up some good deals.  Maybe the sentiment is that the bottom has finally been hit.  Or maybe it’s the belief that Congress will end up passing some sort of relief bill when they meet back up on Thursday.  Even Japan, who’s been in a bit of a slump themselves for a while, is pressing us to pass something and vowed to give money to our banks to keep them liquid.  The world is watching our scales turn, ripping money from the rich hands of a few and giving it to the open hands of many little investors who know when a price is right.

 

I need to do something about my portfolio.  TMA and the new Washington Mutual (WAMQ) respectfully made 50% and 140% gains today, and all I made was a combined $75 on the two.  After the TMA reverse split, and the fact WAMQ is now trading at 8 cents, these big percentage gains mean little to my combined 450 shares of the two.  A 140% increase on an 8 cent stock was barely a nickel move.  I need to pick up more shares to take advantage of these huge percentage gains, but this is where my rational self and my irrational self start fighting.  My rational self says “forget it, wait it out and pay your credit card off this month,” while my irrational side says, “screw your credit card, this is a once-in-a-quarter-century opportunity to get in on the bottom of the market!”  Who will win, who will win…. I get paid Friday.

 

The Dow closed up 485 points after a steady climb all day to $10,850.  Oil gained $4.27 to close the day at $100.64.  The dollar made up some ground it had recently lost against the euro; it would now take $1.41 to get one euro. 

 

And so ends the third quarter.  

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Monday September 8, 2008: 11th Bank Failure (thanks McCain), and a day of profit-grabbing??

September 8, 2008 · Filed under money, politics, stock market · Tagged , , , , , , , , , , , , , , , , , , , , , , , , , ,

“Never count your chickens before they’ve hatched” goes the saying, but I didn’t follow this advice.  This morning during the premarket, I busted out my calculator to crunch just how much I was set to make based on the premarket numbers, and it was a lot.  So you can imagine my surprise when I signed back into Etrade at 11AM to see most of my stocks in the red and Freddie trading at $1 (which actually was better than I expected).  Indeed, the financials all opened up big- real big- and I’m sure today’s blip will be seen for years to come.  But then things happened.  I’m still not sure exactly what, but maybe it was a composite of a bunch of things:

 

Washington Mutual (WM) gave their CEO Kerry Killinger the boot, instated veteran Alan Fishman, and was told by the Office of Thrift Supervision to provide “an updated, multi-year business plan and forecast for its earnings, asset quality, capital and business segment performance” (SmartMoney.com).  Sure sounds like micromanagement to me.  WM closed the day down 5.62% after being down 20% during some of the session. 

 

Syncora’s (SCA) rating was withdrawn by Fitch Ratings, who had just in August changed SCA’s rating from “evolving” to “positive”.  Who are these Fitch Ratings people anyway, and why does their word mean so much?  SCA closed the day down 4% after being down by double digit percentages various times during today’s session. 

 

Radian Group (RDN) opened the day at $5.50, which was up from Friday’s close of $4.79, steadily fell throughout the day like its siblings, then fell off in the last few minutes of trading to close the day down 17%.   Google message boarders think someone knows something, although no news has yet hit. 

 

Silver State Bancorp (SSBX), driven into the ground by John McCain’s son Andrew McCain, failed on Friday, making US bank casualty number eleven.  I held just 125 shares of them, worth just over $100, so the hit wasn’t so hard.  But that with Freddie had me reeling.  I contemplated selling WM and SCA, or buying more WM, or buying Deerfield Capital (DFR), or not buying them, or waiting it out, or putting a 60-day limit order in, but in the end I did nothing.  I sold SSBX at market for a gain less than the commission and held on to FRE.  I decided that once the smoke clears, which stock is which and where each is going will become much clearer.  But I sure do wish those pre- and early-market numbers held!  And most of all, I hope today isn’t a sign that the US banking industry is going the way of Wal-Mart (who coincidentally closed the day up 2%), and headed to put all the little guys out of business.  One analyst, Steve Stelmach of Friedman, Billings, Ramsey & Co. said that “mortgage insurance could become an obsolete form of credit enhancement” in the long-term because of the bailout.  He was loosely referring to the drop in RDN’s share price and how the company, and ones like it, could be phased out.      

 

The Dow ironically traced a smiley face, opening way up, dipping a bit, then closing the day up 289 to $11,510.  Because of Hurricane Ike barreling towards the Gulf of Mexico, oil closed the day up as well, but just by 11 cents to $106.34.  The dollar is at its highest value in nearly a year!  It would now take just $1.41 to get one euro.  Including the hit from SSBX, I closed the day down $323, $211 of which was from FRE. 

 

You win some, you lose some; I just wish I had won today.  The market rallied and I was left in its dust.  With any luck, much of today’s activity in the financial sector was just profit-taking and the days to come will reveal the real reaction to this past weekend’s news.  Next time I won’t count my chickens before they’ve hatched and started laying eggs of their own!

 

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Thursday September 4, 2008: The market’s back bear! (and no one knows why)

September 4, 2008 · Filed under money, politics, stock market · Tagged , , , , , , , , , , , , , , , ,

“Nobody knows why the Dow dropped 345 points today” was the headline on Bloggingstocks.com.  The bottom dropped out of the Dow today- 344 points to close at $11,188!- and speculation is flying about why.  All three indices- the Dow, NASDAQ, and S&P 500- fell back into bear markets. 

 

A lot of data was slotted to come out this week, and today’s data showed that initial unemployment claims, and therefore people recently laid off, have risen to a near 5 year high.  But retail store sales are up and oil dropped $1.46 to $107.89, a 5-month low.  Oil has lost $40 in two months.  So why did the market plunge today? 

 

Conspiracy theorists think the rich of the world sold off for a reason and are keeping tight-lipped about why.  Maybe it was a hedge fund sell off.  A story came out yesterday predicting the fall of many hedge funds because commodities are falling.  Maybe it’s just a manifestation of the extreme volatility the market has seen this summer.  Bill Gross, the head of Pacific Investment Management (PIMCO), recognized and announced August’s light trading volumes, and warned of an imminent “financial tsunami”.  Maybe this scared people?  What the heck is a financial tsunami?  Was today’s selloff a reflection of a weakening global economy?  The dollar is up to its highest against the euro since the year began, and it now takes just $1.43 to get one euro.  The euro was created, in part, as a similar exchange to the US dollar, but $1.43 is a great improvement from the $1.5903 it would have taken to get one euro on July 15.  And isn’t it true that if the US economy improves it will lead the world back out of the hole? 

 

Maybe Sarah Palin’s dirty nomination speech made everyone run.  “When [Obama] you’re done parting the waters and healing the world…”?  Was she serious?  Maybe when she’s done slinging mud she’ll focus on what she’ll do about the desperate economy and enormous national debt. 

 

It’s unclear what happened today, but what I know for myself is that I lost $300 today when the Dow lost 345, and I gained $1,000 yesterday when the Dow gained just 15.  Five of my financial stocks- PMI, RDN, ABK, SCA, and MTG- had double digit gains yesterday, so I expected a selloff today; but I expected it to be a lot worse than it was after [fighting my internet connection and finally] seeing that the market took such a hit today.  National City’s (NCC) rating was cut today by S&P but the stock price fell less than 6%!  First Horizon’s (FHN) rating was also cut, and its stock price fell just over 6%.  If I can make large gains when the market makes small ones, and have medium losses when the market has big ones, then I’ll be sure my experiment is working. 

 

Data on the total unemployment rate comes out tomorrow, and it is believed to be at 5.7%.  Will this data spike the market again?  A lot of questions are unanswered. 

 

It’s easy to read between the lines that I’m voting for Barack Obama, but to stay aware of both sides, I have been watching speeches from both sides and John McCain’s speech scared me tonight.  By the end of his speech, it seemed that if he had a gun he would have started popping caps in the air.  I’m not sure I’d feel safe with him in the same room as the red phone and bomb button. 

 

In the hopes that Mary Caraccioli had some insight into today’s market, I stayed up past McCain’s speech and then past Comcast Channel 3’s insightful commentary on McCain’s speech to catch Money Matters Today.  It’s usually on at 11PM (and rerun the next day at 11AM) but to my dismay, the show was completely run over by the McCain commentators and was not pushed up to a later time.  The sports show Out of Bounds came on instead.  Typical.  I guess tomorrow will be a complete surprise. 

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Monday August 11, 2008: Oil ruled, RDN posts loss yet gained, will the dollar break free?

August 11, 2008 · Filed under money, stock market · Tagged , , , , , , , , , , , , , , , , , , , , ,

The Financial Times called this week “crucial” for determining if the six-year downward trend of the dollar will finally end.  One Euro now costs $1.4904, down almost 10 cents from about a month ago.  If it does break free, economists are expecting a quick economic rebound.  Fingers crossed.

 

Etrade pushed my funds through this morning so I was clear to buy.  I picked up more shares of MBI and CHC, and then bought into ACA Capital Holdings (ACAH) before reading the news that hit Friday about the company writing no new business.  So about 15 minutes later I sold ACAH at a loss.  I also sold off TGIC today at a loss and for the same reason.  No new business can never be a good thing, and I should have read up first before buying.  Haven’t I learned this lesson already?  Yes I have; the reason I sold TGIC the first time was due to a “no new business” declaration.  I should have read up on ACAH before jumping in.  I’ll never learn!

 

With the rest of my available funds, I was only able to buy 40 shares of Silver State Bancorp (SSBX), which I should have bought into first, and had written a note to myself to buy into first, but for whatever reason didn’t.  It has a relatively low trading volume, but the tiny fraction created by dividing its 52-week high into where it’s currently trading was just too good to pass up.  I’ll pick up more SSBX later in the week.

 

By 1PM I set up a plan for what to buy into next.  UCBH Holdings (UCBH), MF Global (MF), AMCORE Financial (AMFI), and Corus Bankshares (CORS) all create tiny fractions when dividing the current price by the 52-week high, and UCBH and MF both reported some sort of second quarter gains.  CORS and AMFI had unusual upward movement today, which could be a red flag, and also have much lower trading volumes than UCBH and MF.  Because of all this, I decided my next two moves would be into UCHB and MF, as soon as Etrade clears the funds created from selling off TGIC and ACAH.

 

I’d like to take a second to scream how dope Michael Phelps is.  MICHAEL PHELPS, YOU ROCK!!  He doesn’t represent every boy whose dad was an ass; he represents what every person can be.  Why Channel 7 shows soap operas over the Olympics I’ll never understand.  Ok, back to stocks.

 

Radian Group (RDN) reported a loss of $392.50 million ($4.91 per share) this morning as opposed to a profit of $21.1 million ($0.26 per share) this time last year, causing its share value to drop in the morning, but the news was quickly forgotten RDN closed up 8% on the day.  Reporting a profit these days is the anomaly, and even when a financial posts a profit, such as ABK last week, a stock can still fall.  There seems to be little rhyme or reason to financial stock prices in this environment, except that the announcement of “no new business” slaughters a stock price.  All other news is fair game.

 

The Dow was completely driven by oil today: when oil fell in the morning, the Dow made gains, and when oil had a change of heart around 2PM, so did the Dow.  http://www.advfn.com/p.php is a great site to watch the Dow, Nasdaq, and the S&P 500, and their connection to crude oil prices.  The Dow closed the day up 48 points to $11,782.  Oil closed the day down 75 cents to

 

$114.45, the lowest it’s been since May 1, and fell below the benchmark $113 a barrel at one point during today’s trading session.

 

After the closing bell, Syncora Holdings (SCA) reported a second quarter loss of $492.9 million ($7.67 per share).  It should move up or down (who knows?) in the morning.  Naked short sellers return tomorrow, and I’m starting to have serious doubts about the fate of Freddie Mac (FRE).  By the end of the week if the news that big wig Legg Mason bought millions more shares doesn’t send FRE into the green, I may need to cut it loose.  Manny needs mental peace, I need mental peace.  Sinkers don’t bring the peace, just the pain!

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Friday August 8, 2008: Oil bubble bursts, Dollar’s biggest gain

August 8, 2008 · Filed under money, stock market · Tagged , , , , , , , , , , , , , ,

Etrade sucks.  When I transferred finds in this morning, a little window popped up saying the funds would be ready for immediate investment.  When they didn’t show in my account, I called and the rep told me I’d have to wait until the 14th.  By 3:30PM I wasn’t happy with that answer, so I called back and the new rep told me they’d fix the problem within 30 minutes.  But they didn’t.  Total bullshit.  You really do get what you pay for, but in Etrade’s case, I think $10 a trade and free customer service is way overpriced. 

 

Telegram U.K. declared a burst of the oil bubble.  Well no shit.  All the Escalade drivers who have been [falsely] cursing China’s oil demand for driving up the cost of their premium unleaded must be thanking God for answering their prayers.  Ah, I’m just bitter today for being cheated by Etrade.  As a result of the burst in oil, transportation was the big winner today.

 

But all I could do today was watch.  Mbia (MBI) reported a surprise profit of $1.7 billion before the bell this morning, so its stock jumped big in early morning trading.  Between last night and this morning, I whittled today’s buy plan down to three stocks: 50 more shares of MBI before it hit the stratosphere, 100 more of CHC, and 50 more of ABK, but it was a no go on any of it.  Damn you Etrade!  Liars!

 

JP Morgan analysts, as if they’re any sort of authority these days, downgraded Ambac (ABK), so its stock fell even after the great profit it reported on Wednesday.  People on the Google message boards think it was a classic case of stock manipulation, and I may agree.  ABK ended the day down 8%, MBI ended the day up 3%, and CHC ended the day up 48%. 

 

Fannie Mae (FNM) reported a huge second quarter loss of $2.3 billion ($2.54 per share) and a slash of its dividend before the bell this morning, so it was no surprise its stock fell.  But it was a bit surprising that Freddie Mac (FRE) saw green today.  I know I still have a lot to learn about the stock market, but it struck me as odd that Fannie didn’t pull everything else into its vortex like Freddie seemed to do yesterday.  

 

All in all, I gained today, but not enough to erase yesterday’s huge loss.  The Dow closed up 303 points to $11,734, and oil closed down $4.82 to $115.20 per barrel.  The dollar made its greatest one-day gain in over five years, and gold hit a 3-month low.  The Beijing opening ceremonies are tonight, so the world’s eye will be in China. 

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