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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Silver Super Bull who wrote (4600)	1/8/2004 4:43:03 PM
From: russwinter	Read Replies (1) \| Respond to of 110194

From Alcoa's quarterly, they mentioned cost challenges ($150 million yoy) which will be addressed in later conference call. They apparently were able to pass these along via higher prices (how much is unclear) to their end user customers, combined with financial juggling and "insurance settlements". Is there an earning quality question here? Will this be typical? Cost Savings and Management Actions In the fourth quarter, the company surpassed its three-year $1 billion cost savings goal, marking the second time in six years that the company has achieved more than $1 billion in sustainable savings. That intense focus on profitability was critical as the company faced considerably higher costs for energy, raw materials, and benefits, as well as the impact of a weaker dollar on manufacturing operations outside the U.S. this year. In the fourth quarter alone, those costs increased by more than $150 million before tax over the last quarter of 2002. Management actions that offset the higher costs included: Drove $12 million of new cost savings in the fourth quarter; Reduced the company's fourth-quarter effective tax rate to 21 percent by recognizing benefits from foreign net operating losses, offsetting higher taxes from the Latasa sale; Recognizing $105 million in pre-tax gains from insurance settlements of a series of historical environmental matters in the U.S.; and Achieved higher gross margins of 20.3 percent in 2003, up from 19.8 in 2002. Together with higher metal prices, these management actions more than compensated for higher costs in the quarter. The company will announce a new set of long-term cost challenges at the 4th quarter analyst workshop on January 22, 2004.

To: Silver Super Bull who wrote (4600)	1/8/2004 5:03:33 PM
From: russwinter	Read Replies (1) \| Respond to of 110194

All that just to get mocked by James Cramer! If anyone has the whole piece? Probably that the consumer doesn't matter now? If so he should read CI comments on page 4 about major fixed investment cycles (scarce and time gapped). This issue is a freebie, so everybody should read it: contraryinvestor.com We will see what happens when the insider selling start up again in earnest after reporting season, and underwriting supply gears up. I'll post the AMG fund flow out in a few hours, and we'll see if it's a factor right now. I think the money's spent, and most of this is very late in the day (but mindlessly aggressive) margin buying, geared mostly toward tech stocks, and this bogus BIG capital spending cycle playbook. Sentiment is hyper-bearish which suggests when it turns, it could be violent. sentimentrader.com No fear whatsoever in the VIX: finance.yahoo.com^VIX&t=2y&l=on&z=m&q=l&c= from TheStreet.com Bears Blew Their Home-Field Advantage Thursday January 8, 3:50 pm ET By James J. Cramer, RealMoney Columnist You mean to tell me that Gap Stores (NYSE:GPS - News), Kohl's (NYSE:KSS - News) and Ryland Homes (NYSE:RYL - News) didn't cause the market to roll over? You mean to tell me that there was enough strength out there that we weren't kiboshed by the housing shortfall and the retail let-up? You mean the playbook didn't spread and we didn't get the contagion to Black & Decker (NYSE:BDK - News) and Citigroup (NYSE:C - News) and Best Buy (NYSE:BBY - News)?