For the past four weeks gold has been in to doldrums, hanging around the $1,330 range. Some hedge funds sold out their positions. Analysts were on the tape saying that gold has lost its luster and is ready for a fall.

Now, today, you look at the gold price and it's up. $15.80 at $1,364 per ounce. And you are wondering what's going on. You look at today's news and you read that China has just raised interest rates. So as a trader you decide to sell the gold short because gold does not like higher interest rates. Wrong! The market turned around like a vengeance. By noon it was up $13.00. It wasn't logical, but it happened anyway. The shorts quickly covered their positions.

Continue reading Gold Moves Sharply Higher on Inflation Worries and a Weaker Dollar

Gold Moves Sharply Higher on Inflation Worries and a Weaker Dollar originally appeared on BloggingStocks on Tue, 08 Feb 2011 16:30:00 EST. Please see our terms for use of feeds.

Forgive me if I stray slightly, but I could not help thinking about how ironic it would be if someone leaked information as to the whereabouts of Wikileaks founder and "fearless leader" Julian Assange -- who is in hiding!

It would be even more ironic if a CIA operative who had his cover blown by Wikileaks decides what goes around comes around. Let's face it, in its own way Wikileaks has become a rogue nation, so why wouldn't the CIA get involved?

In the mean time, this has probably helped world markets as it has overtaken everything else as the big story of the past 48 hours. In a bizarre way, Assange may have achieved one of his goals by bringing the world closer together, sort of.

Continue reading Serious Money: Does BAC Have Anything to Fear from Wikileaks?

Serious Money: Does BAC Have Anything to Fear from Wikileaks? originally appeared on BloggingStocks on Wed, 01 Dec 2010 11:00:00 EST. Please see our terms for use of feeds.

Banks could face another mortgage crisis, according to Barron's, if they are forced to buy back subprime, Alt-A and options adjusted home mortgage securities they've sold prior to the financial crisis, mostly as mortgage-backed securities. Already some buyers, like Fannie Mae (FNMA) and Freddie Mac (FMCC), have enjoyed some success returning defective mortgages. And this could be just the beginning.

The banks, of course, are fighting vigorously to fend off these demands. As usual, the courts will have to settle the matter. The focus of the debate seems to be founded on the issue of representations and warranties that may or may not have been violated.

There are no surprises among the 11 banks mentioned. It is the conspicuous absence of names you might expect to find that is.

Continue reading Chasing Value: Banks, Barron's and Buffett

Chasing Value: Banks, Barron's and Buffett originally appeared on BloggingStocks on Fri, 26 Nov 2010 10:00:00 EST. Please see our terms for use of feeds.

In case you need to be reminded to look closely at the books, today's poster boy for erroneous ledgers, Bernie Maddoff, should be a constant reminder. Furthermore, when you are looking at the books, remember that Benjamin Graham, mentor to "my pal Warren," advised buying stocks for less than their intrinsic value. And book value is the starting point in attempting to establish that.

Two weeks ago, I posted an update on my toxic stock picks. These were six unloved stocks where I felt the stage was set for market beating returns. The same is true again for today's market-beating group, although it is not the headlines that tied this group together, but their standout bargain metrics.

Continue reading Chasing Value: Cheap Stocks by the Book

Chasing Value: Cheap Stocks by the Book originally appeared on BloggingStocks on Mon, 16 Aug 2010 12:00:00 EST. Please see our terms for use of feeds.

Continue reading Fearless Friday: BAC, C, and GE Report Earnings

Fearless Friday: BAC, C, and GE Report Earnings originally appeared on BloggingStocks on Thu, 15 Jul 2010 18:00:00 EST. Please see our terms for use of feeds.

Wednesday morning, brokerage house UBS (UBS) upgraded fellow broker JPMorgan Chase (JPM) to buy from neutral. UBS believes that JPMorgan is currently at an attractive entry point that reflects its earnings and risk while overlooking potential offsets and better footing.

UBS added that it sees "current universal bank valuations as an opportunity to get into top quality names, and JPM is as good as it gets." UBS also believes that the regulatory reform will be less strict than initially thought. In addition, UBS feels that JPMorgan's broad business mix should help the brokerage.

Continue reading JPMorgan Chase Upgraded by UBS

JPMorgan Chase Upgraded by UBS originally appeared on BloggingStocks on Wed, 02 Jun 2010 12:10:00 EST. Please see our terms for use of feeds.

Continue reading Serious Money: Optimistic Economic View

Serious Money: Optimistic Economic View originally appeared on BloggingStocks on Mon, 29 Mar 2010 11:30:00 EST. Please see our terms for use of feeds.

The financial crisis, employment market and social media explosion have converged, providing a new level of clarity into what is happening in the world around us. Where was ground zero for this financial catastrophe? Well, according to the LinkedIn blog, five companies have shown the most action: Barclays (BCS), Credit Suisse (CS), Citigroup (C), Bank of America (BAC) and JPMorgan Chase (JPM). Interestingly, Goldman Sachs (GS), among the biggest winners now that we're pulling out from the recession, didn't see as much play.

Continue reading Financial Crisis Didn't Push Bankers from Industry, LinkedIn Reports

Financial Crisis Didn't Push Bankers from Industry, LinkedIn Reports originally appeared on BloggingStocks on Sun, 21 Feb 2010 15:10:00 EST. Please see our terms for use of feeds.

JPMorgan Chase (JPM) wanted a piece of what could be the most interesting insurance IPO of the year, but it won't get a taste.

American International Group's (AIG) Asian life insurance unit, American International Association, is going to go public in Hong Kong for an estimated $10 billion, and JPMorgan isn't being allowed to play, insiders say, because of a sour relationship that stretches back to the September 2008 financial crisis. As a result, it will be the only major investment bank not being admitted to the party.

Continue reading AIG Skips JPMorgan for Asian IPO

AIG Skips JPMorgan for Asian IPO originally appeared on BloggingStocks on Mon, 15 Feb 2010 11:00:00 EST. Please see our terms for use of feeds.

Food stamps are pumping up revenue at retailers across the country. Costco (COST), Wal-Mart (WMT) and others are seeing rushes an hour before funds are credited to electronic benefits transfer cards. Wal-Mart's CFO, Tom Schoewe, has noted the trend, telling Reuters, "Once the clock strikes midnight [on the last day of the month] and EBT cards are charged, you can see our results start to tick up."

Spending via EBT is not only increasing, it generally happens quickly. JPMorgan (JPM), which runs EBT programs for more than 20 states, reports that buyers run through 85% of food stamp funds within the first three days of their availability.

Continue reading Retailers See Market Opportunities Below the Poverty Line

Retailers See Market Opportunities Below the Poverty Line originally appeared on BloggingStocks on Mon, 21 Dec 2009 08:20:00 EST. Please see our terms for use of feeds.

Maybe Goldman Sachs (GS) does care what outsiders think about it. The company has come under plenty of fire this year for its post-financial crisis bonus payments, especially after having accepted TARP money from the government. In order to keep the world off its back, the bank is going to pay managers their annual bonuses in stock this year instead of cash.

And the stock issued will have to be held for five years. So, recipients will have a long-term stake in the company. But it seems they're being compensated for that, too as GS is spending a total of over $20 billion in compensation.

Continue reading Goldman Sachs to pay $20 billion bonuses in stock, not cash

Goldman Sachs to pay $20 billion bonuses in stock, not cash originally appeared on BloggingStocks on Fri, 11 Dec 2009 09:40:00 EST. Please see our terms for use of feeds.

Tech sector IPOs surged by a factor of five in terms of value from 2008 to 2009. A mere $749.2 million raised in 2008 jumped to $3.8 million so far this year, according to data from Thomson Reuters. In 2008, only three went public, while 10 tech companies made the plunge in 2009. And, expectations are even higher for 2010.

Paul Bard, a research analyst at Renaissance Capital, forecasts between 40 and 50 tech industry IPOs next year, in which $4 billion to $5 billion in capital would be raised. "We've been expecting an uptick in technology because it has really been underrepresented in the market over the last few years," says Bard. The IPO market for high-tech companies was strong in 2007, but it seized up along with virtually every other form of capital raising when the financial crisis erupted in 2008.

Continue reading Tech IPO comeback: $50 billion in 2010?

Tech IPO comeback: $50 billion in 2010? originally appeared on BloggingStocks on Sun, 29 Nov 2009 14:10:00 EST. Please see our terms for use of feeds.

In running a very tight stock screen recently for value plays Burlington Northern Santa Fe (NYSE: BNI) showed up on a list of 14 stocks. Interestingly all the large railroad stocks did. This reminded me of several stories I have done on the subject, the most recent being Chasing Value: Watch BNI -- the heck with Citigroup.

To summarize, about six weeks ago a Citigroup (NYSE: C) analyst declared it was time to sell the stock when BNI was trading in the mid $60s -- I said investors should do the opposite, it was a great value. Friday the stock closed at $76.98. Even at this price it is a value and ever more so with oil prices steadly creeping up.

Continue reading Sunday Funnies: Economics -- art or science

Sunday Funnies: Economics -- art or science originally appeared on BloggingStocks on Sun, 07 Jun 2009 18:10:00 EST. Please see our terms for use of feeds.

"What can get this market going again?" asks Chuck Carlson. In The DRIP Investor he says, "It's helpful to understand what stocks within the Dow need to do well for the index to do well."

"Not surprisingly, IBM (NYSE: IBM), the highest-priced stock in the Dow, carries the greatest weighting at more than 9% of the index. Obviously, with such a heavy weighting in the index, IBM will need to be a decent performer for the Dow to do well going forward.

"And when you total up the exposure of IBM with the other tech stocks in the Dow - Microsoft (NASDAQ: MSFT), Intel (NASDAQ: INTC), and Hewlett-Packard (NYSE: HPQ) - the total tech weighting in the Dow is 16%. Thus, tech stocks matter to the Dow, so it is diffcult to see the Dow sustaining a move upward without a nice rebound in the tech sector.

Continue reading What will move the Dow? A look inside the average

What will move the Dow? A look inside the average originally appeared on BloggingStocks on Fri, 06 Mar 2009 15:20:00 EST. Please see our terms for use of feeds.

A spokesman for JPMorgan Chase (NYSE: JPM) Thomas Kelly said his firm has not disclosed what it did with the $25 billion in emergency bailout money it has received. In fact, JPMorgan Chase is declining to provide any such disclosure.

AP has reported that none of the 21 banks that received $1 billion or more from taxpayers is tracking, or at least willing to disclose how they are using the money. Let me be clear -- THIS STINKS TO THE HIGH HEAVENS!

What kind of deals did Treasury Secretary Paulson make with these favored financial institutions? The money would be very easy to track. Why wouldn't that be a part of the bargain?

Paulson obviously did not read Conservative bankers? Surely you jest!, but he should have. Of course, having former Goldman Sachs (NYSE: GS) CEO Paulson negotiate with his Wall Street buddies on behalf of the taxpayer is highly suspect. At a minimum we have the good 'ol boy network operating in full form.

The banks simply are avoiding what should be required scrutiny by pleading ignorance. I don't believe the money can't be tracked, or even traced now after the fact. What happened to the idea of more transparency? More cover up I fear!

The banks should be subject to full disclosure. The use of the funds should be subject to review. Government money should be subject to the Freedom of Information Act. Why all the secrecy?

PS: Personal emails I have been receiving and the initial comments indicate strong sentiment about this issue. I encourage those that care to forward this story to their elected officials and friends encouraging full disclosure -- as promised! Obama used the internet to help win the White House, lets use it to get someone to listen with an internet blast from all over the country!

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture and planning firm. He writes the columns Chasing Value and Serious Money.

Banks not disclosing billions -- why all the secrecy, Paulson? originally appeared on BloggingStocks on Mon, 22 Dec 2008 11:44:00 EST. Please see our terms for use of feeds.

Yesterday, Johnson & Johnson (NYSE: JNJ) was downgraded by JP Morgan as reported by my colleague Melly Alazraki in Johnson & Johnson (JNJ) downgraded - really?.

I wanted to further elaborate on some issues because of the position Johnson & Johnson holds in our hearts, and many of our portfolios. I should also point out that the downgrade did have a caveat, the analyst believes the stock may very well regain strength toward the end of 2009.

JPM believes Johnson & Johnson is expensive relative to it's peers. That should be expected from my point of view because it is considered the measure of a safe haven in our uncertain times. The tougher the economy becomes the more one should expect JNJ to separate itself from others.

Continue reading Chasing Value: JPM creates JNJ opportunity

Chasing Value: JPM creates JNJ opportunity originally appeared on BloggingStocks on Thu, 30 Oct 2008 14:14:00 EST. Please see our terms for use of feeds.

Not that I necessarily thought the data would. Revenues from continuing operations decreased a whopping 23%, coming in at $16.7 billion. Net loss from continuing operations was $3.4 billion. This compared to a net profit of $2.1 billion in last year's similar quarter. The loss per share from continuing operations was $0.71. The big driver was, of course, a major collective write-down in the Securities and Banking category. Citigroup had to eliminate $4.4 billion of value in this area. Just about all the numbers in this report inspire no confidence. As market volatility to the downside worsens, assets under management are taking a hit. The Institutional Clients Group saw a major drop in its revenue base, diving 48%. And according to this source, this is the fourth quarterly loss for Citigroup in a row. In addition, JPMorgan Chase (NYSE: JPM) is now the largest bank in terms of assets. This major financial brand has taken quite the fall.

Citigroup is going to continue to have a tough time as the market and the consumer make their way through the credit crisis. The negative wealth effect that is surely coming (if it hasn't already arrived) will cause further deterioration in Citigroup's value. Earlier in the year, I was bullish on the company as a value play. I certainly no longer am. I see the bank's stock breaking through its 52-week low. I think the company will ultimately survive, but I can't say I'm entirely confident about anything in these days of surreality.

Disclosure: I don't own any company mentioned; positions can change at any time.

Citigroup's Q3: Par for the course, unfortunately originally appeared on BloggingStocks on Thu, 16 Oct 2008 14:32:00 EST. Please see our terms for use of feeds.

JP Morgan Chase (NYSE: JPM) recently down $1.65 to $32.86:

JPM is scheduled to report Q2 EPS on July 17. JPM call option volume of 42,387 contracts compared to put volume of 33,557 contracts. JPM July 32.5 straddle was priced at $3.84. JPM August option implied volatility of 72 was above its 26-week average of 44 according to Track Data, suggesting larger price movement.

Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com

Option Update: JP Morgan Chase volatility elevated; shares near five-year low originally appeared on BloggingStocks on Fri, 11 Jul 2008 15:41:00 EST. Please see our terms for use of feeds.

MAJOR PAPERS:

• Anheuser-Busch Companies Inc (NYSE: BUD) is going to turn down InBev's unsolicited $46.35B takeover offer and that may come before week's end, the Wall Street Journal reported. InBev is then expected to pursue a hostile takeover and Anheuser will say the offer undervalues the company. Instead, Anheuser will attempt to boost its share price by selling non-core assets such as its theme parks.
• The Wall Street Journal also reported that Belgian-Dutch financial firm Fortis NL (OTC: FORSY), in a move to increase its solvency, will attempt to raise $12.54B, and will also cancel its interim dividend and sell some assets.
• According to people familiar with the situation, the Wall Street Journal reported that JP Morgan Chase & Co (NYSE: JPM) reportedly dropped out of the bidding for General Electric Company's (NYSE: GE) $30B credit-card business. The sources said Citigroup Incorporated (NYSE: C), Bank of America Corporation (NYSE: BAC) and Capital One Financial Corporation (NYSE: COF) are not expected to submit bids, as a result of charge-offs and rising delinquencies in their own credit card portfolios.
• The Financial Times reported that the London Stock Exchange, in a joint venture with Lehman Brothers Holdings Inc (NYSE: LEH), unveiled a pan-European equities trading platform to fight rivals that are hurting its market share.

Newspaper wrap-up: Anheuser-Busch prepares to battle InBev originally appeared on BloggingStocks on Thu, 26 Jun 2008 08:00:00 EST. Please see our terms for use of feeds.

MAJOR PAPERS:

• Long Island, NY's Astoria Financial Corp (NYSE: AF) has found a novel way to reduce the number of its nonperforming loans by changing its internal policy on when mortgages are classified on its books as troubled, the Wall Street Journal reported. By counting home loans as non performing when the borrower misses at least three payments, not two, Astoria reduced its non-performers to $69M from $106M in three months.
• The Wall Street Journal also reported that the indictments of Matthew Tannin and Ralph Cioffi, two former Bear Stearns hedge-fund managers, are expected to cite a personal e-mail suggesting the funds were "toast," four days before they told investors they had little to worry about. JP Morgan Chase & Co (NYSE: JPM) has said it will cover the legal costs of the fund managers.
• Hewlett-Packard Company (NYSE: HPQ) is set to reorganize its printer unit. The Wall Street Journal said that the unit's five business units will be cut down to three to become more efficient at adapting to a marketplace in which consumers are relying less on printing.
• According to people close to the situation, the Financial Times reported that Anheuser-Busch Companies Inc's (NYSE: BUD) board of directors is planning to meet this week to discuss the $46B bid from rival brewer InBev.

Newspaper wrap-up: When a troubled home loan is not originally appeared on BloggingStocks on Thu, 19 Jun 2008 08:00:00 EST. Please see our terms for use of feeds.