Bespoke: Barron’s Roundtable head scratcher

Last weekend's Barron's provided a mid-year update to its annual "Roundtable" report, and as the title of the article suggested, the consensus among panelists was that the market has come "too far, too fast." While that view is certainly not a minority opinion, we are confused with the logic behind it. As noted in the article,

"Many predicted at our Jan. 5 confab that the stock market, oversold and under-loved, was due for a major bounce. Now they think stock prices have overshot corporate fundamentals and a correction is in order."

So on January 5th, when the S&P 500 was at 927, the members of the Barron's Roundtable were looking for a major bounce. Now, with the S&P 500 up 2% since then, they think the market has come too far, too fast?

Source: Bespoke, June 15, 2009.

Two Great Video - Just for Laughs

Zombie Banks - Musical op-ed piece written and performed by John Forster and Tom Chapin.




Bontrust: Increase In Currency (Money love)

The Worst Stock of the Decade

Congratulations to Velocity Express (VEXP), the single-worst performing stock of the decade...that’s still trading.

Since the beginning of decade, VEXP has had three reverse stock splits; a 1-for-50, a 1-for-15 and a 1-for-5. That adds up to 1-for-3,750.

VEXP closed last century at $8 a share but adjusting for splits that comes to $30,000. Today, it’s at 21 cents. Ouch! That’s a loss of 99.9993%. Heck, it’s more than Ivory Soap.

Those -99.99…% figures can be a little deceiving so let me add some perspective. Velocity’s loss is the equivalent of dropping in half 17 times. It’s like a 10% loss every month for the decade. If would have turned $1 million into $7.

But it’s still trading

Source:
The Worst Stock of the Decade
By CrossingWallStreet
April 22, 2009 12:08 PM
http://www.crossingwallstreet.com/archives/2009/04/the_worst_stock.html

Ten & Five years of Sector Total Returns

After a month where all but two sectors (Consumer Staples and Health Care) have had double-digit returns, a look at longer term sector returns shows that investors will need a lot more months like March before even being able to think about getting back to even. The first chart below shows total returns for the S&P 500 and each of its ten sectors over the last five years. As one might expect, Financials are by far the biggest losers. With a decline of 62%, the decline in that sector is over two times the decline of the next closest sector (Consumer Discretionary). On the upside, even after the collapse in energy prices and energy stocks, the sector is still up nearly 70% over the last five years.

Looking at a ten-year window, overall returns are even worse as the S&P 500 has lost a total of 22.6%. Over that period, three sectors (Financials, Telecom Services, and Technology) are down nearly 50%, while only four are up. Returns like these hardly reinforce the idea that stocks are the best asset class to build long-term wealth, although with a track record this poor, can it get much worse?

Source:
Sector Total Returns
By Bespoke Investment Group
April 06, 2009 at 01:11 PM
http://bespokeinvest.typepad.com/bespoke/2009/04/sector-total-returns.html

Once Again, We’re Sorry About Michele Bachmann

In yesterday's installment, Michele Bachmann saves us from a sneaky Chinese and Russian plot to achieve world domination through a global currency, but reveals that she was not at school the day they studied this in sixth grade:

Risk Management Software

Its funny ’cause you know it was true:

CNBC Gives Financial Advice

If you haven’t seen this already, you HAVE to watch it - funniest thing ever. Jon Stewart takes on CNBC for its coverage during the market collapse; NYT's biz columnist Joe Nocera is his guest. What to conclude from the fact that everyone's cheering Jon Stewart's evisceration of CNBC's Santelli, but everyone hoorayed Santelli at the time? Love the message, hate the messenger...

The Daily Show With Jon StewartM - Th 11p / 10c

CNBC Gives Financial Advice

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