NCAA Tournament

Im pulling for George Mason this weekend since every other team I had in my brackets is gone. I really hope they can pull it out.

By the way - Short QQQQ, IWM, WEN, I may come up with a few more as the day rolls on. I anticipate the start of Q2 to be rocky. Let us hope this shields me from the downside.

Out of pure annoyance

I have to post this article, and I wish CNBC would read it so I could stop hearing about independent research. The article was written by Herb Greenberg, Coulumnist at www.marketwatch.com. I highly recomend reading his stuff. Here is his article from today:


By Herb Greenberg, MarketWatch
Last Update: 3:29 PM ET Mar 29, 2006
SAN DIEGO (MarketWatch) -- This debate over "independent" research has gone from ridiculous to absurd.
Witness what I view as a well-orchestrated public-relations "spin" by Biovail Corp. (BVF :
biovail corp com
News , chart, profile, more
Last: 24.17+0.20+0.83%4:31pm 03/29/2006
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Sponsored by:
BVF24.17, +0.20, +0.8%) and Overstock.com Inc. (OSTK :
overstock com inc del com
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Last: 30.66-0.07-0.23%4:53pm 03/29/2006
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Sponsored by:
OSTK30.66, -0.07, -0.2%) in their lawsuits against Gradient Analytics, for daring to write negatively about their companies.
The spinmeisters are trying to create the impression that Gradient's research wasn't truly independent because clients were permitted to request research on companies. Subsequent reports -- if they were written -- were then disseminated to all Gradient clients. The bugaboo, according to those attempting to turn this molehill into a mountain, is that Gradient's reports didn't disclose when a report was the result of a request by another client.
That is not a run-of-the-mill legal matter but a First Amendment issue.
Never mind that private research firms without brokerage or trading arms aren't considered investment advisers and therefore aren't regulated by the Securities and Exchange Commission. My take on this, as I've been saying on CNBC in recent days, has been: So what?
I can't vouch one way or the other on the allegations made in the lawsuits against Gradient and others, beyond noting that claims in affidavits about yours truly that are part of Overstock's suit are false and misleading. The real issue here, however, is that Gradient provided private, for-pay research to several dozen clients. The key word is "private."

It's important to note that no clients have filed complaints; the complaints are only coming from companies that were the focus of negative (and, in turn, correct) reports. In an e-mail dispatch, Whitney Tilson founder of the hedge fund T2 Partners, noted that a friend of his -- a Gradient subscriber -- pointed out that "Gradient discloses clearly to its clients that its reports may have been the result of custom reports that were done first for another client."
That is not a run-of-the-mill legal matter but a First Amendment issue.
What if reports from private research firms find their way to journalists, which they sometimes do? Shouldn't they contain disclosures that ideas may have come from a client's tip? Wouldn't I want to know that a report may have been written at the suggestion of a research firm's client?
Oh, please! I don't give a hoot.

This is private research, and, quite frankly, it's no different from a typewritten report by an unknown person in a plain brown envelope or a published report from a major investment bank that you know handled the company's IPO. What I care about is the quality of the information, which I am obliged to then confirm. That is, after all, why I tell the IRS I'm a "reporter." No matter where a lead originates, it generally results in further reporting and, one hopes, winds up being a jumping-off point to a greater story. If I then quote someone, I point out that person's bias. (Funny, but people generally only complain when I point out that a person is bearish. Why is that?)
Don't get me wrong: These private research firms could get themselves in hot water if they intentionally distribute false information or, worse, let one client know that a recommendation has changed before alerting others.
Beyond that, as in life, what happens behind closed doors is between consenting adults.
Sticking with a theme: It's another joyous day. So now, according to stories by Jesse Eisinger in Wednesday's Wall Street Journal and by Roddy Boyd in Tuesday's New York Post, the SEC has subpoenaed Gradient to get e-mail and phone records of contacts with nearly a dozen journalists, including Jesse, Roddy and me. That's instead of trying to get them directly from the journalists and news organizations.
While the SEC appears to be well within its legal rights to use this backdoor approach, though not necessarily acting in the spirit of the privilege afforded journalists, I echo Jesse's point that it will have a chilling impact on market participants sharing their information with the press.
An SEC spokesman told Jesse that regulators "don't believe the policy chills law abiders from communicating with the press."
Jesse said the comment was naïve. I'll be more blunt: The spokesman is simply wrong.
While I'm as busy as I've ever been, with more ideas to chase than I have time to research, I've already had several good sources say they can no longer communicate with me -- certainly not by e-mail -- on stories that may question a company's fundamentals.
Even on the phone, though, one of these hedge-fund analysts made it clear he's really not supposed to have any contact with me.
That's too bad, because it means the promoters will win, and investors will lose.
In the meantime, I believe this McCarthyism of the markets (combined with the euphoria in the stocks of securities exchanges) will turn out to have been a bell ringer of a market top if there ever has been one.


I have to say that I love that last line. I will look to take some profits in a few stocks as the week closes out. I am still eying WEN as a short, I was stopped out today, but may consider getting back in given its relative weakness.

Oil

Does anyone notice that oil keeps creeping higher. I hate to take a stand here but depending on the action tomorrow I may be entering more short hedges heading into the weekend. We are almost at Katrina levels in oil and the market is still going up. Look at companies dependant on polymers as the major losers with this move.

Buying Power

The market is rocking today and I have made purchases so lets scratch my comment from below, I dont know what will slow the market down now...if anything...

Potential Trade

Here is an idea for a trade. Apple computer, 30th anniversary. Hey why not lets just come out with something cool to actually make our stock go up for the first time in two months. So here is the plan buy the stock, hope they announce something really cool on or around April 1st and then flip the stock and make a profit. At least that is my theory on the subject. Let us hope it works out. The downside to this is the fact that this stock is under some serious pressure and has absolutely no momentum right now. A few others might need to get this idea for it to give you a comfort level heading into later this week, otherwise its essentially a crap shoot that AAPL will come out with a product better than Ipod speakers or some other ridiculously worthless product.

The market should be interesting tomorrow, I think the market may find some support, but we shall see. I would not be a buyer tomorrow though.

Taking a hit

The market is getting slammed right now as people essentially sell on the news everyone had been expecting. Again I reiterate that I want to see the market go lower but I doubt it will happen. I have covered my trade short positions.

The Fed

I am looking at the FED meeting tomorrow as a stepping stone to a summer when the market gets hammered. My thinking is as follows. The consensus is never right and every talking head on CNBC says that the FED will raise tomorrow and then maybe in May and then DONE! OK, now here is what I think will happen, the will raise both times but they wont give any indication of what they are going to do and the market will get hammered. At least that is my dream world. I want the market to go down, and yet I am forced to keep buying stocks because the market continues to go up. My plan for tommorow, is to place some short hedges on before the announcement. I will probably short the QQQQ, IWM, maybe a few other ETF's and have a very tight stop on them all in case I am wrong it wont really hurt me. But its probably better to be protected heading into the fire than not.

And for those of us who still care, the yield curve is still inverted, the housing market is slowing, there is no clear leadership, and the market is so complacent and bad event could send us reeling. -Aside from that I think the market is going higher in the short term. I should update throughout the day tomorrow if something interesting happens. Lets get to work.

Why it Pays to Read the Conference Call

It is great advice to read the conference calls each quarter a company reports. Sometimes it will give you an added edge into what is going to happen to a company in the future as well as give you some insight into managements demeanor and attitude toward the company. In essence its a great way to sometimes piece it all together. In that spirit I bring you a classic moment from Pacific Sunwear's (PSUN) most recent conference call:

"One of our goals in the new more aspirational store design was to improve our girls penetration..."

Now that's just funny. Sometimes you don't even need to take quotes out of context for them to be funny. I would have VLCM done but I blame it on college basketball. I will be done soon.

Clean Up

VLCM posted their 10-K this week, a full review will be posted this weekend.

How about the selloff today in NYX, BOT, NDAQ - all the exchange stocks got hammered. I think its ridiculous that they are public (all of them) however, they are great momentum plays at the moment. Just remember the momentum can carry them down a long way.

I typed in the symbol for Readers Digest today and I noticed something that was quite possibly the most ridiculous thing I have ever seen:

http://finance.yahoo.com/q/h?s=RDA

Yeah, thats right for the last few weeks RDA has issued probably 100 press releases that are all basically the same, with the exception of a name. You would think that they could have just made one list, but whatever, I guess you need something to occupy your time when you work for a magazine that no one reads...

And finally, here is part three from Arne, our superior Overstock analyst from below:

http://www.thestreet.com/_tscs/markets/activetraderupdate/10275405.html

Apparently OSTK is a steal at $30 a share. Arne says so. If you have a real money password this is a much more intelligent article:

http://www.thestreet.com/p/_mktw/rmoney/internet/10274766.html

Google was added to the S&P 500 it should fly tomorrow, sadly I think this rally could be short lived. Maybe even a short point.

Thats it I'm done till this weekend.

Investment Advice

Arne Alsin a writer for thestreet.com recently published an article about how Overstock.com (OSTK) is a great stock and should be worth $92 a share. This is his second article:

http://www.thestreet.com/_tscs/markets/activetraderupdate/10274634.html

There should be a third to come this week. His first is somewhere else on the site you need to search for it. But the point is this, OSTK I must say may not be the most financially healthy company (to say the least). Here is chart of the last years performance of OSTK:

http://finance.yahoo.com/q/ta?s=OSTK

Not bad, 45 to 28, if you were short. But lets get back to Arne here. So at the bottom of his article there is this disclosure:

At time of publication, Alsin and/or ACM was long OSTK, although holdings can change at any time.
Arne Alsin is the founder and principal of Alsin Capital Management, an Oregon-based investment advisor, and portfolio manager of The Turnaround Fund, a no-load mutual fund.

So I decided to check out The Turnaround Fund to see what Arne is all about. Hey I can't be too quick to judge purely based on a call to buy OSTK. So looking into his fund revealed this:

http://quicktake.morningstar.com/Fund/snapshot.asp?Country=USA&Symbol=TURNX

Apparently Arne has managed quite the fund, he actually ranks last in his category in terms of performance this year. Last year he was in the bottom 1%, and the year before the bottom 8%. His last quarter of positive returns was in Q4 2004. Furthermore I found this to be interesting:

Glenn D. Surowiec is the Fund's co-portfolio manager. Mr. Surowiec serves as a senior analyst and trader for the Adviser and has served in that capacity since 2001. Prior to joining the Adviser, he was a derivatives structuring manager for Enron Corp. from 1998 to 2001...

Yep that's right his co-portfolio manager used to work for Enron during their primetime of operation. Now I am not here to judge him or imply that he had anything to do with anything that happened there, I just thought it was interesting to point out.

So what is my point of this? Essentially, be careful who you take advice from, sometimes just because they seem like a professional doesn't mean that they have advice that will make you money. It is important to consider the source when it comes to your own money. I wish Arne all the best in hyping his book, I just hope he took some quick profits and isn't going to hold it till it hits $92 because I think he could be pushing his luck hoping for that.

Google Finance is Here!

And I'm not gonna lie, it is pretty weak.

http://www.google.com/finance

Check it out for yourself. I like the blog feature, but the news section is going to come up with excessive amounts of articles, you can't form organized portfolios. Also it doesn't help the stock because they don't advertise on it yet.

Although I must say the charts which contain details as to when companies reported which events is sweet.

In all it is severely lacking, but knowing google it will improve.

Sears Canada

Ohh to be a holder of Sears Canada's stock. That stock right now is trading at $18.05 Canadian dollars. Now Sears Holdings (SHLD) the parent of Sears Canada and proud owner as of Friday of 63.2% of its Canadian namesake's shares. Now what SHLD was attempting to do was buy all of Sears Canada at a price of $16.86. Yeah that's right, over a dollar below the current market price. So SHLD was pissed that people weren't dumb enough to sell their shares below the market price just because SHLD wanted them too. It makes sense, but what does SHLD do? SHLD has decided that since 6 of the Sears Canada directors have quit (can you blame them?) that they are going to just put SHLD employees on the board now to pretty much lock up any dissenters. Then they made a threat to cut Sears Canada dividend if people didn't agree to sell the stock. So they are basically cornering the company and forcing them to give up, or if the company chooses to fight, SHLD will just drive them into the ground. And the strange thing is, why would they do this to one of their own? They are going to screw this company over so it can be part of a giant screwed up company that nobody shops at, well I guess that makes sense. Can I just take a poll here for a moment and if anyone has shopped at Kmart or Sears in the last 6 months can you just leave a comment at the bottom and say why or describe the experience. I have no faith in this company, but I welcome anyone to change my mind.

RSS Feeds Now Availible

After several hours, I finally figured out how to add a link for RSS Feeds to my site. It doesn't look as good as some sites, but honestly I have no idea what I am doing so this was a big step for me. Above the links to different websites are two RSS feed options. The second one that says multiple RSS feeds has the usual options to add it to either google, my yahoo, bloglines, newsgator, etc. while the other is just a basic feed. If anyone knows how to change the code to make the actual icons show up please let me know: randommarktthoughts@gmail.com. Enjoy.

Qwest Communications

Q-Now in full disclosure I own this stock, but let me tell you why you shouldn't. Qwest is a horrible company, saddled with debt, in a industry that the competition will eventually beat it out. Right now though they are in the industry trend of a lifetime. Telecom companies have become the new tech of 1999. They go up everyday. In this situation it often pays to own either the best of breed or the worst. And Qwest is one of the worst. Let me tell you why it pays to own the worst though. During bull market times like this it is assumed that the worst companies have the most to gain and that they will somehow turn it around. Whether or not it is likely in this situation is irrelevant, the stock will go higher. The only problem is when this industry turns down those stocks will fall hard and fast. I don't know why I still own this stock and I probably won't sell it for some time to come, I just don't want someone getting involved with a company as crappy as Qwest, despite the fact that it goes up everyday. Look to the best of breed, not Qwest.

Pieces of the Puzzle

ZUMZ - Zumiez did great today. They beat on EPS, sales and boosted their outlook above estimates. That stock should be rocking tommorw. That in turn should translate in to a positive outlook for VLCM. At least we got one out of the two, hopefully PSUN can turn it around. Either way I still think VLCM is a second half of the year story.

The market still goes higher, everyday, non stop, wow, I can't believe it. This in my opinion is going to be the final run up before a fall, I think it will be trigger by the May FED meeting. It will be interesting to see if the market goes up until then.

I am still sticking by my INTC trade even though it has done nothing for the last week. It should rally.

I am waiting on CBS to file their K before I look at them.

NYX watch out for this stock it is amazingly volatile. I think that over the long term though it will be a good pick. It has a secondary coming up though which could hit the stock. After that I say its a good one to buy.

CBS

I am begining to think CBS is going to be a good short with this Howard Stern thing going on. That could be signs that the company is cracking a needs a distraction. I will start looking at them soon. Just and idea. Anyone with thoughts on this email me: randommarketthoughts@gmail.com

Frustrations of a Good Market

It really bothers me to not be fully invested in a market that keeps going straight up. But I have to admit that now is not the time to add aggressively despite the internal desire to do so. The market is definitely in an uptrend right now which makes its relatively impossible to short stocks, but I do like the idea of trimming long exposure.

Over the past few weeks what worries me most is that I have been wrong so many more times than I have been right. INTC did not work out as planned. I could not believe it hit 19.70, that stock is really acting poorly. The strange thing is that the financial companies have been doing so well lately. Look at GS today, its a rocket ship. That should not be the case.

The stock market should still be range bound as the FED should be able to keep it down in the near term.

My eyes tomorrow will be on ZUMZ for its implications for VLCM. VLCM could get hit tomorrow if ZUMZ misses. That would be a general bad sign for VLCM if PSUN and ZUMZ miss. I will keep you updated.

Thats all for now.

Is this legal?

Bellsouth:
Long-Term Incentive Compensation for 2006-2008 Performance Period

The Compensation Committee established, for all executive officers, the performance objectives that are tied to the Company's total shareholder return and the performance objectives that are tied to financial performance metrics for the long-term incentive compensation program with respect to the three-year performance period 2006 through 2008.


Its nice to see that a few days before Bell South announces that AT&T will buy it the company does a little bonus shifting. What I especially like here is how it is tied to shareholder return. What works out nicely is that when the announcement was made the stock somehow jumped from 31.5 to 35, now that is an 11% return. I didn't look too far into this but its nice to know that the executives are going to make out alright in this situation. I would hate to see them run into some financial trouble. Especially since they announced that 10,000 people will lose their jobs in the merger, luckily the executives will be taken care of. It really is a rough world out there. Ohh yeah here is a copy of thes alaries and bonuses in case you were worried about their financial well being as well:


Name and Principal
Position

2006 Salary
2005 Short-Term
Award

F. Duane Ackerman
Chairman of the Board and
Chief Executive Officer
$1,365,000 (1)
$ 2,235,200

Mark L. Feidler
President and Chief
Operating Officer
$ 865,000
$1,179,800

Ronald M. Dykes
Former Chief Financial
Officer (retired 12/31/2005)
Not applicable
$ 800,000

Richard A. Anderson
Vice Chairman and
President – Business
Markets
$ 638,400
$ 830,000

Francis A. Dramis, Jr.
Chief Information, E-
Commerce and Security
Officer
$ 616,000
$ 700,000

W. Patrick Shannon
Chief Financial Officer
$ 560,000
$ 600,000


Thanks guys!

Google = Dumb

http://yahoo.reuters.com/stocks/QuoteCompanyNewsArticle.aspx?storyID=urn:newsml:reuters.com:20060308:MTFH19098_2006-03-08_01-28-50_N07427918&symbol=GOOG.O&rpc=44

How many times in a week can these guys screw up. This is not a buying opportunity though as I see the stock going lower. But wow. What do you think the odds are the guy who put the first version of the slides or still has a job?

Google please stop being stupid, please. Just go about your business and sell a whole bunch of ads and make your stock go up. This is two strikes. Make it three and you go below 300.

BTW: You can help GOOG hit their revenue target by clicking on the ads on the right...just a thought.

Now this is the way to run money!!!!!!

AutoNation, Inc. (NYSE: AN - News), America's largest automotive retailer, announced today that it intends to commence a cash tender offer to purchase up to 50 million shares of its common stock at a price per share of $23. The number of shares proposed to be purchased in the offer represents approximately 19% of the Company's currently outstanding shares. The tender price represents a 10% premium over the closing price of the Company's common stock on the New York Stock Exchange of $20.89 per share on March 6, 2006, the last trading day prior to the announcement.

Mike Jackson, the Company's Chairman and Chief Executive Officer, stated,"The tender offer for our common stock demonstrates our confidence in the future of AutoNation. The transaction will allow us to deliver stockholder value while retaining financial flexibility to take advantage of future opportunities."

AutoNation expects to commence the offer by no later than March 10, 2006.

Ohhh but wait there is more:

ESL Investments, Inc., which owns 77,061,800 shares, or 29%, of the Company's common stock, has agreed to tender all of its shares in the offer. Two of the Company's directors, Edward S. Lampert and William C. Crowley, are Chief Executive Officer and President and Chief Operating Officer, respectively, of ESL Investments, Inc.


Let me simplify what you just read. Eddie Lampert has decided that Auto Nation needs to issue $900 million in debt to purchase his shares back from him. Just so we are clear on this he is taking shareholder dollars (of which he is one) and dispersing this back to shrink the float. Now I am not an expert on this subject but to me its seems like this: Eddie's hedge fund is struggling with investments in SHLD, AZO and AN so in an attempt to get his numbers up this year he is essentially strong arming the company to pay a 10% premium to buy back his shares. Sure this is good for people holding the stock, hell if I owned it I would sell it all right here. Basically because you only get pro-rata for the number of shares you own and since Eddie owns 29% you aren't gonna get to sell all that much. But I would also sell it now because this is an artificial move to make a stock go higher. My money is that this stock heads right back down south after Eddie dumps 25 million shares right back onto the company. Only now the company has triple the debt. I really wish I had enough money to push these companies around like Eddie. I guess that's one way to make money in the market...

Anyone want to make a bet that he ends up in jail sometime in the next 20 years...just a thought.

randommarketthoughts@gmail.com

United Health

I also like UNH on a oversold bounce. This stock has been nothing but pain lately. I am at the point where I may sell it on a couple point rally to move on to something worth my time.

INTC Trade

I have to believe that you can make an dollar trading INTC to the updside. I would set a stop at 19.75 and a sell somewhere around $21. This stock refuses to stay down despite the bad news. It is now apparent to everyone that INTC sucks. So with any hint of good news the stock will rocket. Be patient though its not going to happen any time soon. I could see it hitting 25 within 3 months and I like those odds.

Essential Reading

The Bershire Hathaway Chairman's letter and annual report from the man himself Warren Buffett. Click on the links and read them. You don't have a choice in this matter.


http://www.berkshirehathaway.com/letters/2005ltr.pdf



http://www.berkshirehathaway.com/2005arn/2005ar.pdf

Insider Trading at its Finest

Now on Friday after the close RIMM announced that it had settled its patent dispute with NTP for 612.5 million dollars. This was big news and the stock was subsequently bid up by $20. Now here is something that I noticed. On average RIMM trades 5.5 million shares a day. On Friday it traded 8.2 million shares. Now take a look at this graph:

http://finance.yahoo.com/q/bc?s=RIMM&t=1d

Now it looks like there is no volume throughout the day, but if you look closely that is because it is all dwarfed by the 4+ million buy order that came in only a few minutes before the close. Now I would be willing to bet that someone may have know about this settlement just a few minutes before the close and tried to buy as much stock as they could. That person is going to make a lot of money on this trade. But I have to say this person/fund belongs in jail and I really hope this gets investigated because this is just another example of people in the know screwing over the smaller investors. I hate to see this happen but the truth is it happens all the time. I would just love to see a headline about someone going to jail for this, it would truly make me happy.

The Single Most Ridiculous Thing I Have Ever Seen

No I am about to tell you the story of quite possible the most over-paid, under-achieving, biggest waste of shareholder dollar, stock price destroying, arrogant, should be fired tomorrow CEO in America. ---Henry R. Silverman.

You sir are a disgrace. You do not deserve to have a job running a company. Here is a brief summary of Mr. Silverman's 2005 pay package. A year I will remind you that the stock of Cendant (CD) his company went from around 23 to a whopping 17 and now hovers between 15 and 17. In fact over the last 2 years the stock has done nothing but go down. So here is the lowdown:

$3,300,000 -Salary $12,316,600 -Bonus $100,374 -Other Comp
$6,600,496 - defined contribution, life insurance premiums/bonus, medical benefits

In 2005, Mr. Silverman's perquisites and personal benefits included $49,388 for personal use of corporate aircraft and $49,986 for provision of corporate automobiles and drivers;

--Pretty ridiculous isn't it, especially considering he took a PAY CUT in 2005. But not to be deterred, Mr. Silverman decided to add a little something extra on top of that pittance of an executive salary. He decided to exercise a few options, you know something to the tune of ::

$117,644,547


That brings our total for today to as the WSJ reported $139.9 million dollars. (my total may have left something out so I went with them to be sure)


Yes shareholders that's what you get for a 26% drop in share price and a 36% drop in GAAP income. Do you realize that he took home the equivalent of 10% of CD's income for the year. He should not be allowed to run a public company. He should be fired! And that ladies and gentleman is all I have to say about that.