bmichaud

I think the market is going to go for a nasty tumble, and Prem's deflation bet will eventually pan out. The world is out of bullets and Europe is devastatingly fragile. There is going to be a nasty liquidity issue in Europe and it isn't far away! I used to think that Prem was like a chess player 2-3 moves ahead of the rest of us, and Buffett was a chess player 4-6 moves ahead of everyone else. It's the other way around! Cheers! Sanjeev, Anytime someone used to bring up the fact that Prem was 100% hedged you always countered with "he is hedged b/c he is an insurance company and needs to preserve the equity position". Do you no longer believe that he is hedged solely for that reason? IMO, if Prem thought the market was as cheap as late 2008/early 2009 he would not be hedged like he is. Was his equity position not as at risk back then when he took the hedges off during that time as it is now?

strange.. i think he probably got wiped out on this one? He bought after the decline, I believe around 6 CAD the article said...

Awesome article! Thanks for posting.

Tilson's results (and net worth for that matter - no he is not one of the super rich) should be MILES ahead of where they are given the amount of hand holding he receives. Unreal.

So April 23rd it's announced that Jana Partners established a 12% stake in BKS...... http://www.forbes.com/sites/abrambrown/2012/04/30/microsoft-to-invest-300-million-in-the-nook-e-reader-barnes-noble-shares-up-101/?partner=yahootix ....and not 7 days later BKS announces a deal with MSFT and the stock moves up 100%.... http://articles.latimes.com/2012/apr/23/business/la-fi-jana-barnes-noble-20120423 Not to dump over someone's prowess, but come on, seriously? Major congrats but I'm still suspicious.

http://www.hussman.net/wmc/wmc120430.htm His table pounding is getting louder by the week. Hopefully his projections don't become a reality....

One word - WANNABE. I don't see what the good intention is here - he just wants to make himself feel like he's one of the super rich. EMBARRASSING.

This very well may have been posted already and most here have probably already read it, but I was re-reading it this weekend and thought I would pass along. A_Lesson_on_Elementary_Worldly_Wisdom_As_It_Relates_To_Investment_Management__Business.pdf

Portland, Maine

The opportunity cost of NOT keeping his Lionsgate stake was quite high... I don't think Parsad was going any deeper than to say Icahn missed an opportunity.

This quote must be preserved as it completely and utterly defines the argumentative, combative, dare I say pointless nature of peter burke's posts.

Ben Bernanke assumed his office in Feb. 2006, at which point the fed funds rate continued to go up. It peaked at 5.25% and then went down as the subprime debacle started to show its face. except it wasn't a crisis in 2007. I recall it was wall street's best year ever. the crisis began late summer of 2008. Look up Cramer's infamous screaming video where he's yelling "They're nuts, they're nuts, they know nothing" - August 2007. Burke you must be right. The crisis was completely unknown at that time....

It was 5.26 July 2007 - if I'm not mistaken this was the exact month the Bear mortgage hedge funds blew up. Rates rose into the crisis, effectively accelerating it before easing began in August.

I don't think I am being clear: To me, Bernanke's legacy will not be determined by the inflation vs deflation academic arguments that economists and us finance-types like to discuss. It is going to be determined by the Main Street belief that Bernanke saved Wall Street (which he did and that's not really debatable.) Now, the nuanced position is that, by saving Wall Street, Bernanke saved Main Street whether Main Street understands that or not. I think this argument is largely correct myself but I do put some blame on Bernanke (more on Paulson/Geithner though) for doing it in such as way as to allow bankers to take as much as they could without restraint (e.g., AIG had negotiated with Goldman for a partial payout of the CDS's. Geithner came in and literally pushed AIG negotiations aside and chose to pay 100% face value unilaterally.) But Main Street doesn't really believe this nuanced position that Wall Street had get trillions for Main Street to survive and I don't blame them. Whether us technocrats believe Bernanke a hero is irrelevant. I think Main Street will write history on this one. Well put.

Here's the PDF.... 86338722-Bernanke-Lecture-One-20120320.pdf

Timely article for this conversation.... http://www.ritholtz.com/blog/2012/03/bernanke-vs-the-gold-statndard/

Ala Paul Volker Volker did the hard thing. stop printing. Bernake is doing the easy thing. Start and continue printing. Hardly comparable. That's a non-sensical comparison. Volcker had to deal with an INFLATIONARY environment whereas Bernanke has to deal with a DEFLATIONARY environment, both of which require 100% different monetary/fiscal policies. It wasn't at all obvious that Volker was doing the right thing. He took a lot of grief for a long time going against convention. He caused a lot of pain for the economy by keeping rates high. He was courageous. Bernake is a bubble blower who knows one thing. Money expansion. He is going the Easy thing right now which is provide plenty of money. He is particularly popular with the "money" crowd, those who us OPM to make tons of it for themselves. The courageous move right now is to ease/run deficits in the face of folks such as yourself that believe it's the exact wrong thing to do right now.

Fair enough - but Main Street wouldn't exactly be doing cartwheels in the street had Bernanke/government followed a Jim Grant/Ron Paul type path of tight money/balanced budgets to 20% unemployment, -10% GDP growth, and a 4,000 DOW, which is exactly where we were headed in late 2008/early 2009. Those collecting unemployment insurance while bashing a bailed out Wall Street are having their cake and eating it to - no bailout/deficits/quantitative easing = no unemployment insurance. except you have absolutely no idea what would have happened. you're playing a guessing game, that comes off as certitude. Others would make the case that the bottom would have been deeper, but we we would have come out of it far stronger, and far faster, and with a sustainable path to growth, instead of what we have now, which as your friends at ECRI will tell you, is barely an expansion. This just demonstrates a 100% lack of understanding of depressionary/deleveraging/deflationary environments.

Ala Paul Volker Volker did the hard thing. stop printing. Bernake is doing the easy thing. Start and continue printing. Hardly comparable. That's a non-sensical comparison. Volcker had to deal with an INFLATIONARY environment whereas Bernanke has to deal with a DEFLATIONARY environment, both of which require 100% different monetary/fiscal policies.

Fair enough - but Main Street wouldn't exactly be doing cartwheels in the street had Bernanke/government followed a Jim Grant/Ron Paul type path of tight money/balanced budgets to 20% unemployment, -10% GDP growth, and a 4,000 DOW, which is exactly where we were headed in late 2008/early 2009. Those collecting unemployment insurance while bashing a bailed out Wall Street are having their cake and eating it to - no bailout/deficits/quantitative easing = no unemployment insurance.

Here is the above-mentioned Dalio paper on deleveragings. An_In-Depth_Look_At_Deleveragings.pdf

I believe it may have been posted somewhere here recently, but if you read Ray Dalio's paper on deleveragings, I think you'll appreciate Bernanke's actions. Basically what Dalio says is that in order to deleverage in an orderly fashion, a combination of deficits and quantitative easing is required to get nominal GDP growth ABOVE average interest rates. According to this template, Bernanke is brilliant - thus I would tend to think that looking back Bernanke will be viewed in a more favorable light than the the image currently portrayed by those who believe he is setting us up for hyperinflation.

Thanks. Some interesting comments below this article here as well: http://pragcap.com/james-montier-the-risk-to-corporate-profits

https://www.gmo.com/America/CMSAttachmentDownload.aspx?target=JUBRxi51IIBtbYEu0yy2D233Qql0krF9YIWDpyU9bC1DsIW9OxrQN38JW598obIegPVL5Vm43jTd74zJ0R1rY2lRRYvkFggPe%2bdZF4oUF%2bEun279ii1ThA%3d%3d Or, https://www.gmo.com/America Just focus on bottoms up stock picking!

I can't even believe I'm saying this (perhaps a contrarian indicator in and of itself), but given Adam Hamilton's unbelievable call on the market since the bottom last year and his current bullish stance, I have to take the opposite side of Hussman on this one and go with Hamilton and Moore. Basically the wall of worry is alive and well (unfortunately I was part of the worry for awhile). See here: http://zealllc.com/2012/eustrec.htm Ned Davis also remains quite bullish at the moment. Adam Hamilton and Ned Davis were both cautious on the market last year when Hussman "called the top". Given Hussman's atrocious anaylsis, timing, trading (whatever you want to call it), i gotta side with the proven track records on this one.