-
Want to remove ads? Register an account and login to see fewer ads, and become a Supporting Member to remove almost all ads.
- Status
Everything you said, but no poetry - good or bad, or 370 could turn into 270. Former baseball player. Superstition is like a distinguished guest, you just feel better giving it the respect it is due.
Off Shore
Off Topic Member
His mom's gonna be OK with that use of her basement?
If anyone bails out Spiegel, he would become a permanent enemy of mine. Spiegel deserves to suffer a lot.
OK, so you've got a plan to deleverage as the stock rises.
Don't tell the SEC!
That's the dangerous situation where you might get margin-called. If it drops below 0 they will most likely margin-call you.
The way it works is that the stock goes up. The amount you are *permitted to borrow* is a percentage of the value of the stock. The dollar value of the amount you *have* borrowed stays the same so you now *can borrow* more. (But you shouldn't, not when you're that exposed!)
Very wise. You shouldn't be using this much margin if you don't understand exactly how the margin loans work, so spend some time learning the rules. Learning the details now will save you from tears later. Once you understand how it works inside and out, do what you think is best, but it's very dangerous to do this stuff if you don't understand it.
My go-to scenario for CAPE dropping sharply is a collapse of the banking sector, a collapse worse than 2008. Financials still dominate all the major indexes. If the financial sector collapse takes down highly leveraged companies in other sectors (such as oil) simultaneously, it could be a big price crash. Not saying it will happen, just a scenario I've been kicking around.
ValueAnalyst
Closed
Why do you expect financial sector to collapse? The sector is undervalued. Economy doing well with no major signs of a recession. Loan books are fine. Mortgages are fine.
I thought they had lent a ton of money to the oil sector/frackers too... What percentage, I don't know.
ValueAnalyst
Closed
A fraction of money lent out for real estate, which is doing well.
Yeow. I'm now visualizing a scenario where Tencent is aiming for 10% while Ailbaba and Baidu both aim for 5%, taking 15% of the float off the market. Meanwhile (and not coincidentally) we have a short-covering rally. Does anyone doubt that Fidelity Contrafund is buying more? (They always do.) The really-floating share count may be dropping.
The megabanks are a pack of crooks who cheat depositors, borrowers, and securities buyers on a pretty much constant basis. Loan books are garbage. Mortgages are garbage. The profits (which are real) are from fees many of which are fraudulent (or sometimes the profits are direct subsidies from central banks). Depositors could do a bank run at any time, and would be frankly well advised to, just to get their money away from the crooks. Any level of government could decide to crack down. Whole thing is a house of cards.
But if you liked investing in Enron and Worldcom, then yes, the major banks look great. Personally I don't like to invest in crime syndicates, but if I did, I'd pick ones with more stable business models and less of a record of defrauding *investors*.
There are some perfectly respectable smaller financial institutions, but they're not the ones which are dominating the indexes.
Last edited:
jhm
Well-Known Member
My fortune cookie for tonight looks really good for Tesla.
KnowLittle
Member
Very OT: Did you get out of BRK.A / BRK.A? Debating on lightening up for other stocks (TSLA / AMZN / MU).....
Looks like AH ended at 377.70. I feel pretty good about 380 tomorrow.
Still in BRK. But I've been incrementally selling it.
I think Warren Buffett is making bad stock investment choices (Wells Fargo, airlines, Phillips 66) -- but I do think BRK is basically honest; they have an unbelievably/ridiculously good insurance business; and an excellent railroad; and a utility (Mid-American) which is really aggressively adopting wind. Given that, I'm loathe to get out completely. These positions are mostly taxable, and mostly old (one share is 22 years old), so the bite from capital gains tax is significant and there's a strong incentive to let them sit.
TSLA probably will do enough better than BRK to more than make up for the capital gains bite, but I'm now at my chosen concentration limit for investing in TSLA. I have a concentration limit because I live off my investments; I need to be able to continue to access cash for living expenses / medical emergencies / unexpected house repairs / etc., and for that it's better to have something to sell which is much less volatile than TSLA. Despite my rubbishing of conventional "buy 500 stocks" diversification, I still do think a small amount of diversification is a good idea (small enough that you still have time to analyze each stock).
Of the assets I am managing (after subtracting cash reserved for taxes which will be owed in April 2018, which is 5% of the portfolio), TSLA's now up to 28%, with BRK down to 21% (used to be over 30%). 26% is in retirement accounts which cannot be invested in individual stocks (and is basically in real estate funds). Cash net of taxes owed next April is 8%, most of which is securing TSLA short puts. The cash reserved for taxes payable in April 2018 is also securing TSLA short puts (so if TSLA really drops I will be VERY heavily invested and will have to sell something else, probably BRK, to pay taxes). 9% is in another short-term single stock bet which I do not wish to disclose.
There's about 6% in three stocks which I liked but which went above the price where I was comfortable buying before I bought very much (but are below the price where I'd definitely sell them) and about 2% in two stocks which I plan to sell but which I think I can get a better price for. I probably would rotate out of these into TSLA if I didn't feel sufficiently concentrated in TSLA already.
That should give some perspective on how concentrated I am.
When GS upgrades, it's time to sell
How does he still have clients after being on the wrong side of this one??? He could've been making good use of his AUM... instead of peeing it into the wind
bdy0627
Active Member
- Status
Similar threads
- Locked
- Locked
- Article
