It's time to get together again. Ambition, beauty, drive, wealth,
intellect, knowledge, fun - or maybe just nothing to do Friday night -
come on out and meet me at the Buddakahn Restaurant to discuss macro
economic themes and trading my research. I'll have a drink or two to
loosen up, and will bring some hard copies of the latest professional
and institutional research for the first lucky few to arrive.
As you can see below, we have had a lot of fun in our previous events
and I expect this one to be no different. You will have to register and subscribe to the blog
if you are not already a member (it can be done for free for the stingy
folk) then register for the event using the link to the registration
form at the bottom of the actual event page (you will have to scroll to the bottom).
I have created a sample research package for those who want to gauge
the quality of research one gets with a professional subscription.
Simple download the package below and unzip to your hard drive. Adobe
Acrobat view version 9.0 or higher is required to view the PDF files.
The most successful analysts are being laid off on Wall Street. The Street as always thought of the analysis as a loss leader for M&A sales and brokerage commissions. After Spitzer tightened down on the industry, they tightened the budgets even more. Now, with this unprecedented downturn combined with the limited ability of the firms to use the analysts to sell other services (the Spitzer conflict of interest argument), the analytical staff is considered expensive dead weight that does not add directly to the revenue line.
If you thought the accuracy of the sell side was bad in the past (see Blog vs. Broker, whom do you trust!), you ain't seen nothin' yet. With conflicts of interest still deeply ingrained in the culture and business models, the top flight (cost?) quality talent fleeing or getting fired, and budgets cut to the bone marrow, expect accuracy and analytical quality to drop considerably below mean - and mean was not very high to begin with.
Luckily, a certain entrepreneurial investor who never was shackled by the hypocritical, recursive conflicts of interests that plagues the street has decided to share his proprietary research and lo and behold... I really think his research is better!
Goldman Sachs, Citigroup and Bank of America have recently axed
analysts who covered some of their competitors. The analysts were
particularly prominent within the industry because they were often
quoted in Wall Street news stories and invited to meetings with bank
executives. They were the voices who questioned executives on earnings
calls, and they were often the ones casting most doubt on their field.
Now they join a growing pool of bankers and traders losing their
jobs just before bonus time, with little hope of new employment any
"A lot of these analysts did not believe that they could get
sacked," said Gustavo Dolfino, president of WhiteRock Group, a
head-hunter in New York. "But just writing about the market doesn't
mean you're making any money for the firm, that's why these analysts
are losing their jobs."
Goldman was the first major bank to sack its banking analyst,
William Tanona. Tanona, laid off Nov. 7, had worked there since 2005,
when Goldman recruited him from JPMorgan Chase. He was one of the first
analysts last fall to turn negative on Citigroup and to warn about
Merrill's problems with its bundles of mortgages...
...In a note to clients,
the bank, which is cutting 10 percent of its work force, said it was
suspending coverage of his companies, which included Merrill Lynch,
Morgan Stanley and Citigroup.
...Last week, Citigroup laid off Prashant Bhatia, who covered a range
of brokers and asset mangers like the Fortress Investment Group,
Merrill Lynch and BlackRock. Earlier this fall, Bank of America dismissed Michael Hecht, who
covered investment banks. A Bank of America spokesman declined to say
whether it had begun eliminating overlapping workers among its ranks
since it agreed to acquire Merrill Lynch in September.
Banking analysts were not singled out. Goldman, for instance,
dismissed a dozen other analysts who covered other industries,
including newspapers and industrial companies. In some cases, banks may
choose to lay off senior analysts and promote lower-cost workers into
Anybody looking for analysis can always come to me. I won't even try to push the securities of a company that I just underwrote or try an convince you to allow me to churn your account.
Harbinger bought swap contracts on 4.55 million shares of Navistar that would gain if the truck maker’s shares rose above certain prices, according to a Nov. 14 regulatory filing. Warrenville, Illinois-based Navistar has dropped 63 percent in New York trading this year to $19.86, about two-thirds below the price where the trades are profitable for Harbinger.
In the vein of comparing the blog's research to name brand hedge funds, see "Another Name Brand bites the BoomBust!", I have decided to update the performance charts and announce the availability of a new instiutional program that will allow a new higher tier subscriber level to gain access into my outlook in regards to the positions that I have taken. Below you will find the most recent results to all of the performance comparisons that I have made in the last couple of months.
Radio broadcasting companies, an out-of-favor sector with investors and media consumers, are extremely leveraged and facing difficult business environment.
With the advent of the internet, audio related media distribution barriers to entry have come down dramatically. The dissemination of news has encountered a paradigm shift with the advent of blogs, including the one owned by yours truly. With arguably better content, easier and more customizable access, and a rapidly changing business model that is difficult to grasp by the traditional MSM (mainstream media) management, the Web has literally painted a R.I.P. sign on the coffin covers of many a once might radio station holding company. Are TV station companies next? Did this truly have to come to pass, or was the changing of the guard inevitable? Should Bloomberg, or Murdoch or Curtco Media buy a stake in BoomBustBlog.com to hedge their future?
Here is something that should spark some discussion. As I stated in a previous post, I owned and ran a social class discussion, research and study site (from and applied perpsective, I am not a scientist) that became very popular. I offered tools and research that I utilized in my residential real estate investing, and have decided to offer a model to this blog. For those who wonder why I am offering this model here, just think of it as my layman's version of applied behavioral finance theory.
I welcome all constructive comments, and feel free to pass the model around the Web. Registration is not required.
James Cramer: marked to market!
This is most likely the final installment in my "Name Brands
aren't all they're cracked up to be" series. This string of articles has seen
me compare my (a lowly blogger's) research model investment results with the
biggest and most influential names and indices in the US stock market. For
those who feel that the research model is too hypothetical (nonsense actually,
since it is the most well documented of its kind that I have seen), I have
included a snapshot of my own proprietary trading account. I will get to Cramer
in a minute, but before I do, let's peruse the roadmap of how we got here. Here
is the synopsis to date:
The Name Brand - that bastion of marketing that the finance and investment industries have come to rely on to convince those who should no better to do things that they shouldn't -has come under attack. "Attack by who?", you may ask. Attack by me, Reggie. "Who the hell is Reggie?" you ask. Well, a quick bio , and a list of writings that have brought use here so we can move on...
In the past week or two I attempted to debunk the "'Name Brand' is the best" mentality of so many individual and INSTITUTIONAL investors enamored by the marketing machine that is the Wall Street banks, brokers and Greenwich/mid-town hedge funds. In attmepting to do so I have released this blog's research model results, provided a glimpse into my proprietary trading, a backgrounder on my investing style, and a comprehensive comparison of both the blog and my results as compared to all major (and minor) hedge fund indices.
Now that we know:
- that a man can beat market averages,
- we know hedge funds don't necessarily deliver that much absolute alpha,
- we know the difference between relative and absolute return,
- we know the difference between return and risk adjusted return,
- and know who the hell Reggie is...
It's time to move on to what is the actual essence of Wall Street, the big money center banks and brokerages (or at least what's left of them). As representative of Wall Street, I am using the four largest and most representative banks and brokerages - Goldman Sachs, Citibank, JP Morgan, and Morgan Stanley.
In the past week or two I attempted to debunk the "'Name Brand' is the best" mentality of so many individual and INSTITUTIONAL investors enamored by the marketing machine that is the Wall Street banks, brokers and Greenwich hedge funds. In attmepting to do so I have released this blog's research model results, a glimpse into my proprietary trading, a backgrounder on my investing style, and a comprehensive comparison of both the blog and my results as compared to all major (and minor) hedge fund indices.
Now, I will be moving on to the big money center banks and brokerages (or at least what's left of them). Some time tomorrow, I will release a comprehensive comparison of my blog's statc research model against the timed buy/sell recommendations from all of the big bank/brokerages.No excuses made for disparities in budget, resources, political conflicts of interest, etc. Be aware that I refrained from giving explicit buy and sell advice (except in the case of Bear Stearns where I inadvertantly shared my opinion), which has handicapped the blog's results in cases where stocks have dropped and then risen again, ex. PNC. If you click the "proprietary trading" link above you can get an illustration of the results possible when this blog's research is used to actively manage positions.
|Holding period return|
|* The brokerage recommendations benefit from timing, where the blog is pure fundamental research timing made a big difference in the PNC call, where my proprietary results are significantly higher. PNC had fallen nearly 50%. Of course, I expect PNC to fall much further .|