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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Spekulatius who wrote (32113)	9/20/2008 4:17:57 PM
From: Jurgis Bekepuris	Read Replies (1) \| Respond to of 78468

you could be wrong that WFC was a poor choice as a short I could. I am not an expert shorter. In fact, I don't short period. :) Apparently my timing was poor, but it is indeed overvalued. There are couple things to discuss in this sentence. First, IMHO WFC is just fairly valued, but not overvalued. You may think otherwise. Second, even overvalued does not necessarily make a good short. For shorting you need the stock to fall and preferably fast. Overvalued stocks can still rise or just tread water. Finally, timing is indeed everything in shorting. That's why I would think that TA guys make a much better shorters than fundamentalists. But that's just my opinion. WEB could have bought had over fist when it went to 20$ but he did not. How do you know that he did not? Did he tell you? He actually said in the interview that he is buying either WFC or AXP this quarter. You wanna bet on 50% chance that it was AXP? So in short, sure, WFC can drop significantly from here. I would say that the chance of this happening is not that big. And you strike me not as a pro short but rather as a fundamentalist who gets discouraged and upset that shorts get all the money while he is left on a side. Most of the time such people just lose money when they think that they can do the same as the shorts they read about in newspapers. Usually it ends up badly. I've seen it in many variations. People think that their approach does not work anymore and they try something that appears to work magically well for others. Momo, TA, tech stocks, RE flipping, shorting, etc. And the fact is they have no clue of how the other thing works, so they get burned. Buffett and other people said more than once that success in investing is being able to stay disciplined. I would not say anything if I thought that you have a strategy for shorting that you really want to figure out what works and does not work in shorting. But my feeling is - and correct me if I am wrong - this is emotional and ego driven and sidestep gambling "I won't lose much" thing for you. Which is dangerous. But as I said before. You are welcome to do what you want. You may even be successful in this particular short if/when you attempt it again. Good luck. Peace. :)

To: Spekulatius who wrote (32113)	9/21/2008 6:53:59 PM
From: Spekulatius	Read Replies (2) \| Respond to of 78468

Some scattered thoughts on financials: Barron's has an article about financial stocks. Stated that WFC and USB are overvalued. Possible picks: STT and BK (both mentioned here) which are strong in asset management. LYG - checked out LYG some more. Core equity ratio is 5.9% which is not that great. They purchased HBOS at a 57% premium to their depressed market price on 9/18. LYG seems like a decent bet even though the situation with respect to RE is just as bad (or worse) than in the US. AIB - core Equity ratio 6.5%. Decent results but (weaker, IMO) archrival IRE just cut their dividend in half. Irish RE is in freefall and since it's just a big part of the overall economy (much more so than in the US) it's taking the whole economy with it. Still AIB might be a decent bet, they are decently capitalized, own a good franchise in Poland and some not so good assets in the US that they may dispose of For comparison WFC's Core equity stands at 7.4%.

To: Spekulatius who wrote (32113)	9/23/2008 1:32:40 AM
From: Spekulatius	Read Replies (2) \| Respond to of 78468

Decided to put my toes into some financial stocks today and put some proceeds from Fridays sales back to work: IBKR (21.1$)- discount broker that may benefit from the full service competitors woes. Strong growth in their brokerage division - the market making division may produce lumpy earnings. I like them as a customer as well. STT (58.3$): Custodian/asset manager + Bank. 2/3 of STT revenues are fees only 1/3 are interest related. Very good LT track record and AA credit rating (whatever that is worth). WF (31.5$) my favorite Korean Bank stock.Cheap and recently improved the credit rating.Large government stake may now be an advantage.