Posts tagged TMA
September 30, 2008
· Filed under business, economy, investing, money, politics, stock market · Tagged dollar, dow, euro, fourth quarter, oil, Q3, Q4, stock market, third quarter, TMA, trading, WAMQ, Washington Mutual
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.
September 29, 2008
· Filed under business, economy, investing, money, politics, stock market · Tagged ABK, ambac, C, Citigroup buys Wachovia, dow closed, downgrade, economy, Etrade, Mary Caraccioli, Moody's, Nancy Pelosi, NYSE, opening bell, reverse stock split, September 29, stock market, Sydney Morning Herald, Thornburg Mortgage, TMA, Wachovia, WB
Holy Moly, who saw that one coming?! The House of Representatives voted down the bailout 228 to 205, and it’s being blamed on a “too-partisan” speech made by the Democratic speaker of the House Nancy Pelosi. Whether her speech was partisan or not, someone’s head had to roll.
Hindsight is 20/20, and looking back to last night, there was a clear signal the bill wasn’t going to pass: after an initial positive response, the Asian markets began to slide into red. Real money movers always know things ahead of time, and the Asian markets’ slip was a sure signal that our bill was not going to pass. I should have seen it, and maybe subconsciously I did, but it seemed too unbelievable that the bailout would not pass given its enormity and all the long days and weekends Congress had put into it. But as we’ve seen with IndyMac, Fannie and Freddie, and Washington Mutual, nothing is too big to fail.
Lawmakers are headed back to the drawing board to draft up a new version of the plan, but won’t meet again until Wednesday because tomorrow is Rosh Hashanah.
I’m more of an observer now than an active player. I’m in too deep to do anything except wait, so all I can really focus on is the day to day with the stocks I own and the stocks that those stocks are absorbing. Citigroup (C) bought Wachovia (WB) today for $2.2 billion, or $1 per share.
Two funny computer errors happened today: Thornburg Mortgage (TMA) put through a 10:1 reverse stock split this morning, but not before they multiplied the share price by 10. So during today’s premarket, it looked like I had 3K extra in my account! But the quirk was soon fixed and so was the overinflated share price. By close, TMA was down to $1.15, which would have been 11.5 cents on Friday before the reverse split. To buy back the preferred shares, Thornburg needs to raise more capital. You’re welcome, TMA.
Another blip came to Wachovia’s share price today. At one point, it listed on Google finance at $500! Message boarders were going nuts, and that error put the financial sector up 7% and made it look like the only sector in the green. But that error was also soon fixed, and everyone who owns WB fell back into reality.
One last computer oddity happened at the New York Stock Exchange today: because of a glitch, the morning bell never rang. Mary Caraccioli said she’s never seen that happen.
People are still sweating a Moody’s downgrade to Ambac (ABK). I really hope not. Of all problems that could happen, that one tops my concern. Just about a month ago, I was up over 100% on ABK and now I’m in the red. If a Moody’s downgrade comes, it’ll destroy Ambac, especially after today.
The Dow, which opened down over 100 points in seeming anticipation, dropped 777 points today- the greatest one-day decline in its history and even greater than the drop after September 11, 2001- to close the say at $10,365. However to see the glass 1/10 full, this was the 17th worst daily drop percentage-wise, so not quite the worst. Crude oil fell $10.52 to close at $96.36.
The Sydney Morning Herald reported tonight that “online broking portal Etrade ground to a virtual halt this morning [Tuesday September 30] as it struggled to cope with massive trading volumes.” Is this a hint of more blood to come? Damn sure it is!
September 26, 2008
· Filed under business, economy, investing, money, politics, stock market · Tagged bailout plan, bank, bank failure, dow, oil, Resolution Trust Corp, S&L crisis, Thornburg Mortgage, TMA, wall street, WaMu, Washington Mutual, WM
WaMu closed the day at 16 cents. Its website says “WaMu Customers, Welcome to JP Morgan Chase”. The fail of Washington Mutual is the largest in history, yet it wasn’t nearly as front-page news as other failures. Something’s strange. But like I said, I haven’t a clue what it all means.
A CNNMoney.com article today put the size of WaMu’s failure into terms more easily understood for all us common folk:
“To put the size of WaMu in context, its assets are equal to about two-thirds of the combined book value assets of all 747 failed thrifts that were sold off by the Resolution Trust Corp. – the former government body that handled the S&L crisis from 1989 through 1995.”
My Dad thinks I should get out now. I can’t. Every bank failure and deal has been made over a weekend, so I’m hoping the bailout plan will come this weekend. However, I do really doubt it will do much to my share prices!
In other news, TMA extended its tender offer- again. Imagine that!
At least it’s the weekend. What a week! I think everyone needs a break. Maybe if everyone gets some rest over the weekend some sanity will return to the market on Monday. The Dow closed up 121 to $11,143. Crude lost $1.12 to close at $106.89.
September 25, 2008
· Filed under business, economy, investing, money, politics, stock market · Tagged bailout plan, congress, FDIC, FRE, freddie mac, IDMC, indymac, JP Morgan, tender offering, Thornburg Mortgage, TMA, WaMu, Washington Mutual, WM
This week has totally sucked. Congress is dragging its feet with the bailout plan and Washington Mutual (WM) was seized tonight by the FDIC and sold to JP Morgan. What does that mean for WM shareholders? I haven’t a clue. Message boarders think it means terrible things. This afternoon, WaMu closed the trading day at $1.69, then fell in afterhours trading to 45 cents. What I do know is that, right now, it looks like I made a big mistake on investing in this one.
Thornburg Mortgage has been extending and extending and extending an offer to its preferred shareholders to tender their preferred stock and receive a few shares worth of common stock for each of those shares. Tomorrow is the latest extension’s deadline. If the tender offering goes through, the loss I incurred with WaMu will be erased. If it gets extended again, or does not go through, I will seriously consider pulling out of this whole experiment altogether, paying off my car, and taking a nice trip somewhere.
The fact is, there aren’t enough hours in the day to keep a finger on the economy’s pulse, be in graduate school, and hold down a full-time non-desk job. My head is spinning from the amount of information I’ve missed this week. I have no idea why Freddie Mac (FRE) has been making consistent daily gains of 50%. I have no idea why the OTC IndyMac (IDMC) made a 300% gain today. What are the changes Congress made to the bailout plan? No idea. Is cosine or negative cosine the antiderivative of sine? Not sure. The only thing I do know is, that when push comes to shove, I’d rather be in a classroom of 9th graders for 80 minutes than in a room with slimy bankers for 5 minutes. So all’s not lost.
The Dow gained 196 to close the day at $11,022. Oil made gains today to close at $108.02 per barrel.
Go TMA!
September 15, 2008
· Filed under business, economy, investing, money, politics, stock market · Tagged ABK, AIG, American International Group, BAC, Bank of America, bankruptcy, banks, CHC, fmd, Great Depression, Lehman Brothers, lending window, PMI, RDN, reform, short sellers, TMA, wall street, WaMu, Washington Mututal, WM
Exactly two months from the widely-believed bottom, “the biggest shakeup since the Great Depression” is what it’s being called. Today was the largest 1-day loss to the Dow in seven years. What a total mess. All this time, I’ve been sure no one knew what they were talking about the financials and that the bottom was already hit. Slowly though, I’m coming to ask myself, “what were you thinking??” Analysts had said the worst wasn’t over, but of course I didn’t believe them; I’m stubborn and always have been. Late last night and early this morning, former employees streamed out of Boston’s Lehman building, and all other Lehman locations, with boxes and resumes in hand. After last night’s negotiations failed, it was certain death for their jobs, and their stock, which was at 70 cents by 6:30AM, 45 cents by 7:30AM, and 18 cents at day’s close. In less than 24 hours, the 158 year old mainstay lost 94% of its value. Not only was the bankruptcy of Lehman Brothers the largest bankruptcy in United States history, it dwarfed all other bankruptcies in our country’s history. Along for the hellevator ride from par to the bottomless abyss went all the financials today. Even Merrill Lynch, which was up 30% in premarket trading because of being bought out last night for nearly twice its current value, closed the day up just 0.6% from its sorry close on Friday.
Articles and blog titles that ht today had some pretty colorful titles: “Jaw-dropping day for financial markets”, “A day of reckoning”, “Meltdown in US finance system pummels stock market”, “AIG fights for survival”, “Street’s nasty surprises keep experts guessing”, “Giants fall on judgment day”, “Stocks plummet on financial meltdown”, “It’s a morose Monday for Street’s employees”, “Goodbye to easy money”, and “Broken brothers” were just a sampling. The articles spanned all languages as today hit the entire world like a million tons of bricks.
So many questions arose out of today. What will happen to WaMu? What will happen to the mortgage insurers now that one of the banks they insured has evaporated? What will happen to AIG’s stock value now that the bank plans to head to the lending window? AIG had asked for $40 billion, but word on the street is that they’ll “only” get $20 billion. Following suit of its sibling ratings companies, Standard & Poor cut Washington Mutual’s rating to “junk” today.
Of the stocks I watch, here are today’s nearly unbelievable numbers:
Regions Financial (RF): Down 4% to $11.12
Community Bancorp (CBON): Down 4% to $4.53
Syncora Holdings (SCA): Down 6% to $2.39
Thornburg Mortgage (TMA): Down 7% to 35 cents
Triad Guarantee (TGIC): Down 9% to $2.1549
Financial Select Sector ETF (XLF): Down 9% to $19.15
MBIA (MBI): Down 11% to $11.45
National City (NCC): Down 11% to $4.28
First Marblehead (FMD): Down 14% to $2.67
Centerline Holding (CHC): Down 14% to $2.05
Radian Group (RDN): Down 14% to $3.90
Citigroup (C): Down 15% to $15.24
Ambac (ABK): Down 16% to $6.24
PMI Group (PMI): Down 17% to $2.57
Deerfield Capital (DFR): Down 18% to 60 cents
Bank of America (BAC): Down 21% to $26.55
MGIC Investment (MTG): Down 21% to $5.35
Washington Mutual (WM): Down 26% to $2.00
American International Group (AIG): Down 60% to $4.76
My friend works for AIG. I hope that if he loses his job it’ll be the kick in the pants he needs to get his ass to Hollywood.
The Dow plunged 504 points today to close below $11,000 to $10,917. A few days ago, an analyst on TV said that “it is possible we may see $100 oil within six months”. Within six months, buddy, how about within six days? Crude oil fell to a 7-month low today, losing $5.47 to close at $95.71 a barrel.
This experiment is going to be much longer-term than I previously thought. Luckily I have time to wait. I took another advance on my credit card to possibly take advantage of some of the week’s bargains, and will pay it back on Friday when my paycheck hits.
Later in the day, an article titled “Wall Street Losses Seen Spurring Regulatory Reform” hit CNNMoney.com. Some are calling for another ban on short-sellers. Alan Greenspan, in his interview this weekend, said that short-sellers are necessary to keep prices as a closer reflection of company values. But if Washington Mutual, for example is really trading at [now less than] 17% of its book value (MarketWatch, September 11), how real are the shorties really keeping things?
September 10, 2008
· Filed under economy, investing, money, politics, stock market · Tagged Alan Fishman, default, dow closed, LEH, Lehman Brothers, mortgages, oil closed, oil demand, OPEC, Radian Group, RDN, TMA, WaMu, Washington Mututal, WM
OPEC is made up of 11 countries, and in September 2007, the group agreed to produce 28.8 million barrels a day. Because global demand had been so high (except for in the last few months, of course), OPEC needed to bump that production up by 500,000 barrels a day.
Now that global demand is down, OPEC is “cutting” its production by those extra 500,000 barrels a day and re-adhering to the September 2007 quota. But despite this, and the impending hit on Texas by Hurricane Ike, crude oil lost 68 cents a barrel to end the day at $102.58.
My strength has really been tested this week. Often in the sectors, one bad stock in one sector can cause investors to run hard to other sectors. This week that rotten apple has no doubt been Lehman Brothers whose premarket numbers were up over 20% before 8AM, but then fell like a rotten redwood once 8AM, along with the news that the bank lost $3.9 billion in Q3, hit. Over the course of the day, LEH did make up ground and go green, and when it did, other financials followed. But by 3:30PM the optimism was over and LEH took a turn to close down 7% for the day, again, taking other financials with it. Later in the day, the company made a claim that it will spin its commercial real estate, worth $30 billion, into a new company and will sell another $40 billion worth of residential mortgages to the United Kingdom bank Blackrock. Regardless of all these claims, the last thirty minutes of trading were gut wrenchingly painful as I watched the modest gains of some of my riskier stocks slip away.
I have no stake in Lehman Brothers other than the residual effect its bad numbers have on my stocks’ numbers; I just watch the stock out of interest, much like some (not me) are compelled to slow down to rubberneck a car wreck on the other side of the highway. However, I do own Washington Mutual (WM) who is having some serious problems of its own and whose share price fell to a 17-year low today. I read somewhere today that “there is a 90% chance it will default within five years.” By “default” do they mean “go bust”? And if so, who can predict even the next day, let alone the market five years out? I’m hoping that it was artificial panic, but WM fell by a very real 30% today. Someone on the Google message boards claimed to have purposefully driven by a local branch to make sure a run wasn’t happening. It wasn’t. People were still going in at a leisurely pace to make deposits. That made me feel [only very, very slightly] better since there are no WaMus around here for me to drive by, and I had been wondering. A friend of mine says that Washington Mutual’s new CEO Alan Fishman is “a genius and had a stellar record with Sovereign Bank”. He doesn’t see WM failing. I’m going to take his word for it because my friend is smart himself and what other option do I have? Sell at a loss? Cry in my hands? I don’t think so! Go big or go bust! Oh please go big, not bust!
This week has been painful, but out of optimism, I have to say today was less painful than yesterday, and hopefully tomorrow will be positive, or at least even less painful than today. And amidst it all, Radian Group (RDN) and Thornburg Mortgage (TMA) made double digit percentage gains today, so there is still some light in the sector. The bailout of Freddie and Fannie was a game changer, and arguably a very unfair one, but soon again it will be about balance sheets and not terror.
The Dow moved sideways today and closed up 38 points to $11,268.
September 9, 2008
· Filed under economy, investing, money, politics, stock market · Tagged ABK, ArthurDental, BAC, C, dow, Fannie Mae, FMH, freddie mac, investing, LEH, Lehman Brothers, MA, oil, OPEC, PMI, RDN, reuters, September 9 2008, STI, TGIC, TMA, trading, Visa, Washington Mutual, WM
My God, what have I done? All across the country, investors in all sectors and companies must be asking themselves the same thing. I know my friends are. After yesterday’s huge [emotional] rally in all sectors but one (energy), today seemed completely irrational. Everything fell. This was more than profit-taking. All of yesterday’s gains, 280 points, were shaved off the Dow as the index slipped all day to close down to $11,230, as investors in the financials asked themselves one extra question: “will any financial survive?”
Lehman Brothers (LEH), Washington Mutual (WM), Radian Group (RDN), PMI Group (PMI), Ambac Financial (ABK), First Marblehead (FMH), MBIA, Inc. (MBI), MGIC Investment (MTG), Triad Guarantee (TGIC), and Thornburg Mortgage (TMA) are just some of the financial institutions that had double-digit percentage losses today, and those are just the ones with losses greater than 10%. Citigroup (C), Bank of America (BAC), JP Morgan (JPM), SunTrust (STI), American Express (AXP), and even Visa (V) and MasterCard (MA) lost today. Lehman Brothers (LEH) is reporting their third quarter earnings tomorrow- a week early- after their Korea Development Bank deal fell through and its stock price lost 45% of its value today. LEH stock did bump up 7% in afterhours trading, so maybe there’s good news on the horizon. But no doubt, this bad news cast even more doubt into the financial sector today and helped push share values down. Today was very, very painful. Luckily I was so busy at work, with teaching, duties, and meetings, that I had no time to sit down and digest what was happening.
But my friends did. One of my stock friends, who has made a small fortune day-trading these financials, sent me an article that eased my mind a bit. It definitely crossed my mind a few times in the last couple days that my experiment may not work out after all, but the article he sent gave me some hope. It was titled “S&P Picks and Pans: Wells Fargo, Washington Mutual, TW Telecom, JC Penney, Avery Denison”, and was an article in BusinessWeek online. After all the upgrades and downgrades and rating cuts by people with questionable credentials and too much power, it was nice to read an article from a reputable source deeming one of my stocks, WM, a “hold”. If Washington Mutual is a hold and its going through some actual concrete, documented troubles, then my thinking (and hope) is that yesterday and today’s major sell-offs were out of pure fear. But I still hope the sell-off doesn’t continue!
A Reuters article from yesterday titled “Ambac’s planned muni insurer may be hit by changes” shed some light on what the common sentiment towards the mortgage and bond insurers might be. “In another even more fundamental change, agencies are mulling a shift in how they rate muni debt, using the same scale used for corporate debt. That would result in widespread rating upgrades for municipal bonds, which have a much smaller risk of default than corporate bonds. Higher ratings would in turn reduce the need for insurance.” If there’s less risk of default, then there’s less need for insurance.
One last article I’ll quote, this one from MarketWatch.com titled “Community building ire MarketWatch readers kindle own outrage over Fannie, Freddie takeover” quoted ArthurDental, who is a member of the MarketWatch Community. “”Everyone gets upset about financial aid to the poor,” ArthurDental wrote, “but where’s the outrage when taxpayers foot the bill because some ‘investments’ went sour? So stockholders would be largely wiped out; why then aren’t bondholders made to pay for their mistakes, too?”
It’s telling that this article didn’t hit yesterday when the market soared, but ArthurDental is right. When SSBX failed, I lost my investment. But when Freddie and Fannie exposed themselves to trillions of dollars in bad mortgages and therefore didn’t have the capital to pay the bonds it issued to China, the two lending giants got a slap on the wrist and trillions of our taxpayer dollars. Hey, I made a mistake investing in a company run by a McCain, where’s my money? It ain’t coming and I have to deal. And that’s the way it should be.
That Hurricane Ike took a turn south, and the Organization of the Petroleum Exporting Countries (OPEC) will likely maintain its oil production even though demand is down, caused the price of crude oil to fall to a 5-month low. Crude oil lost $3.08 to close the day at $103.26 a barrel. I lost $1700 today, or in my brother’s terminology, “seventeen hundo”. Ouch.
So what is going to happen now that the rules of the game have completely changed? I don’t dare speculate. But whatever it is that eventually happens seems as if it won’t make itself known for a while. For now, I’ll keep the faith. I took a gamble and put in a limit order for 25 more shares of WM today, and you can imagine my surprise when I signed on later, saw the stock price was at $3.30, and that my order executed at $3.60. When I put the order in, I assumed it was so low that it would expire unexecuted.
And more than anything, tomorrow’s a new day when anything can happen.
August 29, 2008
· Filed under money, stock market · Tagged banks, dollar best montly gain in 16 years, financial sector, financials, FRE, Gustav, investing, McCain, money, Palin, PMI, TMA, trading
Exactly three years since Katrina, President Bush declared a state of emergency for Louisiana. Gustav, now at hurricane status and predicted to morph into a category 3, is on its way. John McCain chose Governor Sarah Palin of Alaska as his running mate, which pretty much nailed his coffin shut. Maybe the thinking is that he’ll lasso in all the Hilary supporters who feel abandoned by their party, but I think the big companies already know Obama’s slated to win. Ford and Chrysler applied for, and will likely receive in January, $25 billion in government loans to transform their outdated factories into ones that can build alternatively fueled vehicles. This tells me that these two giants are already hedging the tax increases they know a Democrat will bring. Hey, if you know you’re going to have to pay more taxes, why not ask for some of the money back under the guise “green energy”? Democrats love everything green!
I’m too cheap to buy cable (and I’d end up watching The Hills reruns all day) so I never get to see Bloomberg on television. But today I spent some time at my Dad’s, who has every station imaginable, so I got to see the channel for the first time. Quotes stream along the bottom of the screen, as anyone who watches the station would know, and whereas yesterday would have been a stream of green speckled with red, today it was just the opposite. And the green speckles, with the exception of UnitedHealth Group (UNH), were all the financials. Although a far cry from yesterday, the financial sector held up today and the profit grabbing wasn’t nearly as rampant as I assumed it would be after yesterday’s major gains and right before a holiday weekend. The PMI Group (PMI) and Thornburg Mortgage (TMA) grew the most, while the tide finally caught up to Freddie Mac (FRE), which fell 13%.
The Dow lost 171 points today to close the week at $11,543, and oil also lost, closing down 13 cents to $115.46. The dollar reportedly had its best monthly gain since October 1992, which is an entire decade before its value began falling against other world currencies. The dollar is on its way back.
Because I go back to work on Tuesday, this may be my last entry for a while. It’s going to be hard making the transition from watching the market continuously to not at all, but work calls and I’m hardly in a position to quit. I like my job teaching math, and in fact, our math MCAS scores improved exponentially from two years ago to this past year. Fifteen percent of our students scored advanced or proficient in 2007 on the math portion of the exam, and this past year that percentage jumped to 45. Eighty percent of our students passed the math section, which is pretty good for an urban high school. Yeah, I’m looking forward to going back, and maybe even teaching my algebra kids a thing or two about the stock market. Who knows? Maybe one of them will be the next Warren Buffett!
August 26, 2008
· Filed under money, stock market · Tagged bonds, dow closed, fed, freddie mac, gulf of mexico oil reserves, hurricane gustav, interest rates, money, oil cloded, stocks and bonds, Thornburg Mortgage, TMA, trading
Happy Birthday, Mom!
Back to work in the UK. Yesterday was a bank holiday over there for some reason.
The dollar has gained and lost value against other world currencies since trends like these began being recorded in the 1970s, and usually, as the Wall Street Journal reported yesterday, the tide takes about a half decade to come in and another half decade to go back out again. The most recent downtrend triggered in 2002 is now six years strong, and with the bounce the dollar has seen in the past few weeks, some analysts are predicting that the dollar is in fact beginning an uptrend. It may all be due less to a better domestic economy and more to a weakening economy oversees, but oil’s recent falls are real, and in the last month and a half the dollar has gained a significant 8% on the euro and 5% on the Japanese yen. The dollar closed the day up 0.68% against the euro today, decreasing the cost of one to $1.4648. News is that the Fed’s next interest rate adjustment will be an increase, but no timetable has yet been set. Consumer confidence in July was said to be up more than expected.
Thornburg Mortgage (TMA) closed yesterday at $0.40, then jumped over 50% in afterhours last night. A friend of mine says he saw 80 cents in premarket trading this morning, but I was sleeping when it happened. The stock opened today up 25%, climbed to 50% above opening, then slowly slid to close up 22%. Google message boarders are predicting TMA to reach anywhere between $1.20 to $5 by week’s end. I’m not holding my breath on $5 by Friday, but it’s starting to look like $1 may be possible. A year ago, TMA was trading at $14/share, which was down from $27 just one month before. One thousand shares of this stock could really pay off if TMA reaches even a quarter of its 52-week high.
Freddie had another up day: 20%. The morning made it look like a great day was about to unfold for just about all the financials, but by the afternoon things had changed. Other than TMA and FRE, most were down except for a few that just squeaked into the green. One financial, Michigan Heritage Bancorp (MHBC) did something I’ve only ever seen OTCs do: it closed up 100%. But the trading volume on MHBC is so low I’m not touching it.
The Dow had a sideways day that ended up 26 points to $11,412, and on anticipation of Hurricane Gustav disrupting production and refining in the Gulf of Mexico region, oil climbed $1.16 to $116.27 a barrel. However, that was down from an earlier increase of over $2, so it may be that Gustav is changing course.
August 25, 2008
· Filed under money, stock market · Tagged Alexei Kudrin, Biden, bonds, Columbian Bank and Trust, Denver, FRE, freddie mac, investing, money, russia, stocks, Thornburg, TMA, trading
Barack Obama announced over the weekend that his running mate will be Joe Biden. The Democratic National Convention begins tonight in Denver, Colorado.
Columbian Bank and Trust Co. of Topeka, Kansas collapsed, bringing the death toll to nine, and Korea Development Bank is having second thoughts about buying Lehman.
My stocks were split in the morning: PMI, FMD, FRE, RDN, TMA, ABK, MBI, and C all saw green while SSBX, SCA, WM, CHC, RF, NCC, and MTG were in the red. Freddie Mac has seen this same pattern day in and day out: big daily swings, which have no doubt has been making some big people some big money. Russia’s Finance Minister Alexei Kudrin reported that his country has made over one billion dollars (670 million euros at today’s exchange) on Freddie Mac bonds in the last six months, and Reuters has reported that demand is up for their 3-month and 6-month bills, so maybe today’s gain has some backbone to it. Warren Buffett says it’s “game over” for Freddie and Fannie, so it could be the run on bonds is an anticipation of a government bailout. Bonds get paid first. Time will tell. The stock has lost 2/3 of its value since I bought in, so at this point my 50 shares aren’t really worth worrying about.
Oil was up in the morning but went red by around 11AM. Resales of homes previously owned rose in July from the 10-year hit in June, and were the highest since February, which beat the Street’s forecast. The median home price has dropped 7% in a month, making is seem as if home prices may finally be meeting buyers’ expectations. Still, the amount of homes for sale in July was the highest ever, according to TradeTheNews.com.
Once the lunch bell rang, oil went green again, and the Dow really started to nosedive. Citigroup (C) clicked into red, and FMD followed once the brokers got back from lunch, but FRE, RDN, and TMA really started to take off. I’d think it was the bond insurers shining again after the news about Russia’s take on FRE bonds, but SCA wasn’t following suit. I take the fact that any stocks are up on a day the Dow is down over 200 points as a good sign of things to come, but the market these days is anyone’s interpret.
Meanwhile, as a throwback to my greener days, America’s Wind Energy (AWNE), the last slug standing, continues to drop. By now, much like with FRE, I’ve lost so much on the thing it’s not even worth thinking about, except for the fact that AWNE was supposed to be bought out by a larger wind company at some point and I continually wonder when that day will be. I’m not really even sure if that day has passed or has yet to come, or if it will ever come to fruition, or if that fruition will be fruition at all. All I do know is that “AWNE” may not even front an actual company and its presence in my portfolio serves as a constant reminder that day and swing trading OTCs on good news may be ok, but trying to invest in one of these small non-companies with low trading volumes is never ever ever a good idea. Ever.
After some flip flopping between red and green, my stocks eked out a modest $80 gain with TMA and FRE as the day’s big gainers and WM and MTG as the day’s big losers. The Dow lost 241 points to close the day at $11,386, and oil gained 52 cents to close the day at $115.11.
All eyes on Denver.
