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- JIMMY62
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» JIMMY62 - random walk from bob
In response to message posted by Kirk:But Brinker said something Saturday that was rather confusing. He mentioned that some investment advisors believed they could beat the market by holding only the best stocks. He then followed it up with the fact that the market factors all existing data into the price of the stock which removes any advantage of owning only the best stocks. Then he goes on today about moabo which leads you to believe he knows something that the market doesn't, and therefore not all the data is factored into the price since the price will be below what it is worth. This seems contradictory to what he said yesterday. Very confusing.
Not confusing at all, two differenet questions, two different answers.
The strategy of owning only the best stocks is blown out of the tub by the random walk theory. If all you know about a stock is that it has done well in the past, has good balance sheet and good management and you don't know the price, you dont' know enough to tell if it is a good buy. In theory the price will be set by the market at an approriate level. But there is no reason the believe that good stocks are priced any closer to intrinsic value than bad stocks.
The trick in investing to identify when the market is wrong. In part that is what Buffett does. Who would claim that Berkshire-Hathaway was a good stock when Buffett gained control? Declining firm in a declining industry. The only thing good about it was the price...and how Warren managed it for ever after.
Bob gave a good answer about the good stock strategy.
Can Bob perform like Warren? Not reliably.
-- posted by JIMMY62
» Will_L - Whoabo UPdate
Good morning IMA subscribers.Although we have a little weakness this morning our indicators (Jiggs peed on the GE side of the Bush) indicate that our bull market is intact.
You will note that during Whoabo bull markets that even though the markets may open lower, we quite often rally higher in the closing averages, confirming our peeing indicator.
You cannot afford to be out of this market one day. I guess that needed to be said when I called Whoabo last Friday. Oh well like Brinker we make chit up as we go along.
How is Vebo and Moabo coming along for his subscribers? 
-- posted by Will_L
» Will_L - Re: random walk from bob
In response to message posted by JIMMY62:Yes, Brinker often claims to be a lone voice in the wilderness. He found out with the QQQs that sometimes the rest of the platoon is not out of step.
Brinker's claim of any ability to find a market that is undervaluing assets while claiming that individual issues cannot be undervalued because of the efficient marke theory is a stumper.
The bottom line is that all Brinker has to sell is the BS that he can time the markets. Any yammering he does ususally displays how false that is--the efficient market theory comments yesterday would go along with that.
-- posted by Will_L
» Kirk - Re: Whoabo UPdate
.In response to message posted by Will_L:
What does Jiggs have to say about Japan?
Nikkei 225 decline since 12/31/1989
<img src=http://cbs.marketwatch.com/charts/int-ad... width=452 height=366>
Nasdaq since 3/11/00 peak
<img src=http://cbs.marketwatch.com/charts/int-ad... width=452 height=366>
QQQ since 3/25/00 peak
<img src=http://cbs.marketwatch.com/charts/int-ad... height=366>
-- posted by Kirk
» Will_L - Re: Re: Whoabo UPdate
In response to message posted by Kirk:"What does Jiggs have to say about Japan?"
Well that would be easy to quantify for him. I will have to let him out the back door and use a rose bush though. That would allow him to orient himself to predict what would happen in the far east. Lately I've been concentrating on the Western markets--using the front door and the boxwood.
Fortunately my techical analyst has endless energy when it comes to "marking" his "charts". He's been known to make predictions inside my house causing it to look like a third world country. For years I didn't understand that was his "developing market indicator". He's an amazing technician.
If you want Imamarketimertoo's international predictions, it will however cost ya "extree".
-- posted by Will_L
» Will_L - Brinker claims the market is in a SECULAR BEAR overall.
Brinker claims the market is in a SECULAR BEAR overall.Brinker claimed after talking about MOABO for over a year that 'when we return to a fully invested position it may or may not be near the lows, my model is not about finding a bottom" he then stopped talking about MOABO until this weekend.
The very silly choice he has for his two scenarios of re-entry --either MOABO--the greatest buying opportunity ever or "VEBO"--VERY EXTRAORDINARY buying opportunity" are very narrow choices if we didn't know that Brinker told the caller who asked about MOABO and the "great buying opportunity" last year that " I didn't say that" and went on to disown the Moabo crap altogether last year.
Now since nearly all cyclical bear markets have been shorter than this one, it doesn't take a bright bulb to suggest that the market is due to go up from a historical basis. But why all of the superlatives?
Brinker said that earnings would be lower than others predicted. Their growth would be pretty anemic (he was wrong in 98 predicting 8 % instead of the acutal 20 plus) He has said the fed has run out of ammo. He is a BEAR.
There are only two ways to get one of these GREAT BUYING OPPORTUNITIES that he is marketing.
1) He is wrong and earnings will take off strongly causing stocks at these levels to be great buys.
2) He is expecting the market to fall precipitously much lower than it is now resulting in a tremendously oversold market.
His model we know is not about finding or predicting such events according to his own words--"not about finding a bottom".
Now it seems silly for someone bashing others for over-estimating earnings to be relying on a big earnings rally in his secular bear. So he must be looking for a big drop from these levels.
It is certainly possible to drop--however that begs a question. If we have this huge drop that would be necessary for either of his once in a lifetime opportunities that he gives as the only two possibilities for those subscribing to his rag WHY IN HELL DOES HE CONTINUE TO HOLD LARGE POSITIONS IN THE MARKET???
If he is counting on a great slide downward, people following his advice are losing 50 to 75% of the money that fully invested people are as the market goes down to become his great buy.
Remember this has to be a huge move to qualify for either a VEBO or a MOABO. A 20% or more move was just an easy little blip for Brinker's last counter trend event. It was only for those few people who wanted to make 20% or more in two to four months. Now this is really really big. Somebody needs to ask. I would think MOABO must be at least 100%. VEBO 60%?
Could it be that VEBO and MOABO are simply marketing tools to stimulate sales of an underperforming asset--Brinker's newsletter? And the source of his buying signal is the Almanac that says this bear market is long in the teeth?
I'd bet on the latter.
-- posted by Will_L
» Kirk - Re: Brinker claims the market is in a SECULAR BEAR overall.
In response to message posted by Will_L:Will, his OFFICIAL market position vis a vis the newsletter is now about 22% equities. IF the market drops 50%, then he only risks 11%...
Now those that bought the QQQs... THAT is another story, BUT that position is now also very small due to under performance so he is just holding the remaining cash reserves for a time to buy...
I've looked at tables and charts and there really isn't much benefit to going beyond 20:80 to 80:20... diminishing returns for being right.
-- posted by Kirk
» ACousins - Re: Re: Re: to jonathon
In response to message posted by BillBowden:Actually, I like the following concepts:
1. The price of a stock reflects the consensus of value among all market participants. I have no idea who said that but it makes more sense to me than prices reflecting all known facts.
2. Bob is spinning, is nutso or sometimes is a bit of both.
I do not think the markets are all that efficient as transactions are not costless or frictionless and information is not costless or perfectly distributed. Some saw Worldcom's troubles more than a year ago reflected in its bonds:
http://www.nytimes.com/2002/07/07/busine...
"...As early as November 2000, for example, Egan-Jones cut its ratings on WorldCom to the lowest investment-grade level, citing its deteriorating profit margins and credit quality. One year ago, when WorldCom bonds were trading around par, or 100, Egan-Jones cut its rating on the company's debt to junk status. The bonds didn't fall below 90 until March of this year. They have been trading around 15 cents on the dollar in recent days.
Looking for risks at other companies, analysts at Egan-Jones essentially examine a company's ability to meet its obligations, on time and in full. At the same time, they assess a company's ability to tap the capital markets for funds, a luxury for many companies today. Indeed, in the second quarter, the issuance of investment-grade bonds fell by 18 percent from the corresponding period of 2001, while junk-bond issuance fell 4 percent.
Mr. Egan named several companies that he thinks will face significant problems in coming months. Although some have already seen the prices of their securities decline, he thinks that they have further to fall. .."
-- posted by ACousins
» Will_L - Re: Re: Brinker claims the market is in a SECULAR BEAR overall.
In response to message posted by Kirk:Well it's true that Brinker's equity holdings have become a lot less 'significant' in subscribers porfolios. Items like TEFQX down 90 percent. Vod down 70%, and QQQs down over 70% and the funds in Portfolio I especially tend to make the amount people invested and held follwoing Brinker's advice much less significant.
However it still doesn't explain his certainty that the next buying opportunity will be nearly a once in a lifetime sort of opportunity--yet he is calling it during what he terms a "secular bear market".
The only explanation possible is that he believes the market will go down a lot from here. Otherwise what will account for this world class buying opportunity? Brinker claims multiples are stretched now and that earnings growth will be ratcheted down. He again claims that the secular bear is in place.
The only way his promised (don't bet on Brinker keeping a promise) VEBO?MOABO crap will occur is if the market that he has stayed in and encouraged a huge bet in since his January asset allocation is going to crash. Wouldn't people like to hear about the coming crash if that is true? Why wouldn't they want to exit and then re-enter at the bottom.
From here given Brinker's earnings take, his belief that P/E ratios are not cheap, the only thing to bring about MOABO VEBO crap is a crash.
Why hype the buying opportunity and not the crash that he believes will bring it about???
-- posted by Will_L
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