Author Archive

  • Behold the Power of Wednesdays
    , July 25th, 2007 at 6:23 am

    Since I got so many e-mails on this subject, I wanted to revisit my post on how good Wednesdays have been for Wall Street.
    Going back exactly six years, the days of the week for the S&P 500 break down like this:
    Monday 1.31%
    Tuesday -9.96%
    Wednesday 37.19%
    Thursday 4.99%
    Friday -1.85%
    That’s capital gains only. For all five days, the S&P 500 is up 28.97%. So except for Wednesday, the rest of the week is net down.
    So what’s the deal on Hump Day?
    A few emails suggested it could be due to Fed meetings, or possibly when the oil stats are released. Personally, I think it’s due to Lost which broadcasts on Wednesday. For the next six days, everyone on the Street says “What the fuck was that about?” It’s just a theory.
    Let’s get some grad students on it.

  • What’s Up 551% in San Diego?
    , July 25th, 2007 at 6:15 am

    Foreclosures.

    Home foreclosures in San Diego County continued their troublesome upward climb in June, but analysts say the number has yet to reach a threshold that creates a drag on real estate prices or the economy at large.
    “California is better off than the nation and San Diego County is better off than California,” said researcher John Karevoll of DataQuick Information Systems. “It still is not a major factor in the real estate market, but if there is a recession, it could become a huge factor.”

  • The Bond Market Says No
    , July 24th, 2007 at 10:09 am

    I used to think if there was reincarnation, I wanted to come back as the President or the Pope or a .400 baseball hitter. But now I want to come back as the bond market. You can intimidate everyone.
    –James Carville

    Last week, I mentioned that KKR had canceled a loan deal for Maxeda, a Dutch department store.
    Now comes another story. Expedia (EXPE) had this great idea to buy back a gazillion shares of their stock. Not with money, but with “future money” otherwise known as debt.
    The bond market looked at the plan and said, “no dice.” Bloomberg reports:

    At least 20 companies have canceled or postponed debt offerings since June 26 as credit markets grow tighter.
    The extra yield investors demand to own high-risk, high- yield, or junk-rated corporate bonds has jumped 0.85 percentage points to 3.37 percentage points since the day before Expedia announced its share buyback, according to Merrill Lynch & Co. index data.

    EXPE dropped 9% yesterday.

  • Earnings, Earnings and Earnings
    , July 24th, 2007 at 9:36 am

    After the close yesterday, W.R. Berkley (BER) reported operating earnings of 92 cents a share, 10 cents more than last year. The stock is going for less than nine times earnings.
    The other insurance stock on the Buy List, AFLAC (AFL), reports later today.
    I also noticed that Dell (DELL) closed at a 15-month high yesterday.

  • Corus Bankshares
    , July 23rd, 2007 at 1:41 pm

    Ever heard of Corus Bankshares (CORS)?

    Don’t worry, you’re not alone. Corus is a pee-wee-cap bank that specializes in making condo loans in markets where people like to overpay for condos. Without anyone noticing, CORS has become one the top-performing stocks of the last generation.

    Over the last 30 years, shares of Corus are up about 45,000%. That’s amazing. Put it this way, Corus has lapped the S&P 500 about 30 times in 30 years and more than doubled Intel (and I bet you heard of that one). Still, few people know about little Corus.

    The reason I bring this up isn’t to tout Corus’ long-term record, but to draw your attention to today’s earnings report. For Q2, Corus netted 74 cents a share, which is a big drop off from the 82 cents a share it made last year. The culprit, naturally, was the real estate market in places like Florida. But here’s the interesting part: Wall Street was expecting much worse. The average of the three analysts was for 61 cents a share.

    I don’t mean this as any hyper-sophisticated analysis of the real estate market. It’s just interesting to note that even experts are having difficulty seeing the magnitude of the housing mess. Perhaps it’s not as bad as it looks.

    Meanwhile, shares of Corus are up about 6.4% today.

  • Lindsay Campbell for Seasonique
    , July 22nd, 2007 at 4:56 pm

    I could’ve sworn I’ve seen this girl somewhere before.
    Oh right! It’s WallStrip‘s Lindsay Campbell promoting Barr Pharmaceuticals‘s (BRL) Seasonique.
    I wasn’t really paying attention to what the product is used for. (I think it’s girl’s stuff.) But I’m amazed at Lindsay’s footwork. I’ve watched it a few times and she stops the ball without looking. See for yourself.
    Let’s see David Beckham do that.

  • The Strangest Market Stat You’ll Read All Day
    , July 20th, 2007 at 2:49 pm

    Since the beginning of the 2006, here are the cumulative S&P 500 returns by days of the week:
    Monday 1.40%
    Tuesday -0.36%
    Wednesday 18.72%
    Thursday 4.36%
    Friday -0.61%
    So what’s the deal with Hump Day? It’s responsible for over three-quarters of the S&P 500’s return. And today’s data point will make it even more.
    Told ya it was a strange stat.

  • Bond Rally
    , July 20th, 2007 at 1:18 pm

    Stocks may be down, but bonds are taking off. That tells us where all the money is going. The yield on the 10-year (^TNX) is below 5%. The cylicals are getting slammed.
    image501.png

  • Looking at Gold
    , July 20th, 2007 at 9:22 am

    Here’s an interesting chart. This is gold priced in dollars (black line) and euros (gold line):
    image500.png
    You can see how the two lines have drifted farther apart, meaning the euro has gained against the dollar. But in euro terms, the price of gold has been fairly stable in the past few months. If I were a technical analyst, I might want to call that a trading range.

  • BambiTV
    , July 20th, 2007 at 9:13 am

    Lindsay chats with Bambi Francisco, formerly of MarketWatch, about Vator.tv.