meiroy

The USA being the tallest midget in the room will keep attracting immigrants and its population will keep growing. Especially as the other midgets keep getting shorter and the China midget gets its pants off, revealing the stilts. The IMF starting to question its austerity call, if they now join the party as well, it's unlikely the push for growth will stop.

txlaw, I think the main point is what you wrote previously "low-cost nature". Their advantage is in the numbers. racemiz, personally I bought the common at the lows and than traded over to the warrants, did this a couple of times. I also own BAC (common and warrants) just put the two in two different investment/trading categories. Either way listening to the conf call today should be fun! yay.

RealtyTrac: Foreclosure Activity Drops to 5-Year Low in September Read more at http://www.calculatedriskblog.com/2012/10/realtytrac-foreclosure-activity-drops.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+CalculatedRisk+%28Calculated+Risk%29#ATsIe0UXrlQOJ7iR.99 Redfin: House prices up 5% Year-over-year in September Read more at http://www.calculatedriskblog.com/2012/10/redfin-house-prices-up-5-year-over-year.html?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+CalculatedRisk+%28Calculated+Risk%29#J8JkwkJJWBF0QTOz.99

Thanks. Lovely article.

1. Is the 260000 goal at year's end still achievable? 2. "The bank has also had as many as 16,000 additional contractors working in the unit, according to company reports.", these are not included in the head count to my understanding yet count for the expense. As they are estimated to have a bit of a loss, any chance they are cramming the "bad times" into very short term and the loss should be expected to be considerably higher? I'm just asking this for fun.

In some countries the declared ROE is completely fake. There should be a similar chart describing the quality of the data according to countries, wonder how that would look like.

Regarding the first point, this seems to be a fact that cannot be denied. It surely did not get there by luck, (I'm agreeing and repeating what you said.) I don't think it's about volatility at all as another poster suggested, it's about risk and higher quality business reduces the risk combined with the following: Regarding the second point, I disagree. Corporate culture is very hard to change in such huge companies, WFC has proven what it is. The great thing about the recent crash is that it was a test which allowed us to see who is what and who is not. WFC has other benefits which were mentioned here and I think other banks would have very hard time to duplicate in the long term.

Whichever printer your purchase, check first if it would accept generic cartridges and their costs -- that's the major cost and not the printer itself. We dumped our HP printers for other brands due to costly cartridges and bulky software drivers.

+1 Kiltacular, and that's just one example. And, BTW (unrelated): http://www.bloomberg.com/news/2012-10-09/u-s-charges-530-in-mortgage-fraud-probe-with-1-billion-losses.html "The U.S. charged 530 people with targeting homeowners in mortgage schemes that cost the victims more than $1 billion, Attorney General Eric Holder said today. More than 73,000 homeowners around the country were affected, the Justice Department said in a statement. The cases, brought over the past year, included “foreclosure rescue schemes” that take advantage of those who have fallen behind on payments, according to the statement." BTW 2: http://www.bloomberg.com/news/2012-10-09/imf-says-european-banks-may-have-to-sell-4-5-trillion-in-assets.html "The International Monetary Fund said European banks may need to sell as much as $4.5 trillion in assets through 2013 if policy makers fall short of pledges to stem the fiscal crisis, up 18 percent from its April estimate." Surely there would be some good bargains for USA banks and for US corporations sitting on all that hoard of cash. I'm very happy having most of my portfolio in US banks. WFC will be fine.

wow. "Again, nothing that got the markets here today is bound to be short-lived. If history is any guide, market participants will not only yearn for the briefest of recessions, the most rapid of reversals in stocks, and the quickest end to the suffocating commodities inflation, but they will also trade accordingly. Furious rallies and subsequent reversals within the overriding trends are to be expected."

I'm half way through and find it to be quite tedious, hope it gets better...

To quote Dr. Michael Burry "If you are going to be a great investor, you have to fit the style to who you are”. That's the key point here, just analyzing financial statements and writing page after page of quantitative numbers (which often are based on qualitative assumptions) will not get you far other than the usual 12-14%. There are plenty of that to be found on the net, articles the length of war and peace yet still missing that "thing", with conclusions which sometimes at best have a weak correlation to the numbers. The wheel has been invented already. The reading is more to define the road you'd like to take and for it to be effective one has to know who they are. My 0.002 cents based on just a couple of years of experience.

Yeah, I'm sure he'll turn around when he gets his brand new 3D Beer Printing Machine. http://news.cnet.com/8301-11386_3-57493377-76/3d-printed-meat-its-whats-for-dinner/ "Peter Thiel's philanthropic foundation gives up to $350,000 to a company named Modern Meadow, which plans to use 3D bioprinting to create an "edible prototype" that's a meat replacement."

Well this technology is only at its infancy and it will take awhile for it to become useful for mass production yet the direction is clear. See above link for printing blood vessels, and there are already ways to print IC and nano scale objects. It has a huge technological and economic benefit which is giving it a very strong tail wind for faster development. Compare what's now available and what was available five years ago or even just three years ago. It's amazing... In addition lets keep in mind that items are constructed now because of various limitation of the construction or assembly itself. You might have five different materials as different objects due to assembly limitation yet if you were to 3D print it you might only require one material.

Exactly, and some of these fences are just a necessary evil. They help in keeping at bay those men who just want to watch the world burn, and those who want to take over it or take advantage of it. And there are people like that, plenty enough in the history books. The fences are not perfect, far from it, yet they are better than nothing.

hmm than you would have a white sextuplets in the middle of a Congo rain-forest with at least one of the babies cooing in yiddish... Someone would probably raise an eyebrow.

I definitely convert first. Awhile ago I started using etrade under the impression that the service at IB would be bad. After a year at etrade it became apparent that any service at IB couldn't possible be worse (read: etrade customer service is absolutely horrendous and they have annoying system glitches). IB is far superior IMHO.

http://techcrunch.com/2012/09/19/makerbot-releases-the-2199-replicator-2-0-a-leap-forward-in-home-3d-printing/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29 "Replicator 2.0, A Leap Forward In Home 3D Printing" I think 3D printing is going to be one of the main forces behind the globalization trend reversal that we will see in the coming decades. Fascinating stuff. Now, how to make money off it...

UCSD is "Printing" Blood Vessels in Seconds http://www.dailytech.com/UCSD+is+Printing+Blood+Vessels+in+Seconds/article27686.htm "But researchers at the University of California, San Diego (UCSD) -- a top player in the field of tissue engineering --have used a new method called dynamic optical projection stereolithography (DOPsL) to grow a fractal network of 3D blood vessels out of soft biocompatible gel. "

seems the warrants are trailing the common now

That's OK, don't worry about it, enjoy it. I'm expecting 110% yearly interest payments though.

I never understand these kinds of statements. Maybe I'm naive. I think people spend too much time listening to Buffett and his statements about things like if a nuke goes off in NYC people will still go on buying gum. If "BAC goes to zero and some others with it", just stop there. I don't get it. It's like these major financial institutions will be worthless and what? You're just going to keep looking for great investments? I assure that if BAC, GS and "others" are worthless you won't need to worry about that. Likely you will be concerned with looking for guns, ammo and canned goods. I cannot envision a scenario where THE major financial institutions in the world are worthless and life just keeps on keeping on. Same shit, different day. I suppose any one of these institutions could be put into some kind of receivership, but all of them? The world would be a fundamentally different place. I think you had this pre-made anti buffett argument and pulled it out on that. I was saying pretty much what you just did. You left the last sentence out in your quote "It is not going to 0 unless there is a total financial collapse and then these options are the last of our worries.". As far as Buffet, I doubt very much he said anything even remotely close to what you claim him to represent. All he is saying, as does Peter Lynch mentioned in a recent thread, that he believes in the core system of the USA and that to be a successful investor you have to be at least somewhat optimistic. I'm pretty sure he would acknowledge what you wrote above, more or less.

No!!! I have otherwise 100% of my money in BAC. This isn't about guessing which company has a lower chance of dropping, this is about avoiding total armageddon in my portfolio if for some reason BAC goes towards zero. Like you, I prefer to spread the downside. Unlike you, I don't want to diversify the upside. And while I'm at it if BAC were to drop and WFC doesn't, I'll take advantage of that. Why the hell not? Or if I have tons of gains next year I can write off the loss on the BAC puts on the last trading day of the year and book the gain on the WFC puts on the first trading day of the following year. Those little potential extras are like "gift with purchase" goodies at the mall. 1. You initially wrote: "Supposing you want to hedge a $30,000 BAC position such that you don't want to accept any losses below $7 per share." It started with an example for hedging a specific position. 2. You have chosen WFC for a reason, as you wrote, you did not choose it by random, hence my conclusion (my understanding of your general idea is to write puts on a company which you estimate has lower chances to drop and use that to buy protection on the common owned.). You consider WFC to be in a better position compared to BAC. i.e. lesser probability for dropping to 0. If you thought they have the same probability than there is no real spread of the downside to begin with. I still think there is some contradiction in what you write, but will leave it at that. Thanks again.

What on Earth are you talking about? You asked me what I'd do if the market crashed and I told you. Then you come back arguing that it is not in purpose with the trade. Huh? I just care about making money. I don't know that the market is going to crash, but when life hands me lemons I get thirsty for lemonade. You're right, that paragraph was completely unclear. Sure seemed clearer when I wrote it...

Maybe you've never had 100% of your downside in one stock before, but I can assure you that it gets less intimidating when the downside risk is spread around a bit. EDIT: saw your reply after writing this. Thanks for replying. Yes, never happened so far to have a common go 100% down, it of course might happen which is why I'm diversified into 5 companies and not just one. I also own WFC directly for the reason which you mentioned. Then again I also own GS, speaking of derivatives... If Europe shit hits the fan (I think it's more of a when than if) and BAC goes to 0 and some others with it, wouldn't some clearing houses as well? It is not going to 0 unless there is a total financial collapse and then these options are the last of our worries. We'll agree to disagree on this. My queries were regarding the options and strategy and not specifically for BAC situation. I still do not understand how the risk:protection:reward is worth it considering you are worried some for BAC going to 0 and Europe poop floating around. There is no protection for market risk only a partial protection for one common with an addition of risk. The situation I described is similar to what happened last year, would you be surprised if it happened again next month or next year? Doubt it. Anyhow, my understanding of your general idea is to write puts on a company which you estimate has lower chances to drop and use that to buy protection on the common owned.