HOFer
Only a fool who wants to be separated from his money invests in something he doesn't understand. That advice comes straight from the mouth of a guy named Warren Buffet. And, no, he's not Jimmy's brother... and they've got the DNA to prove it.Originally Posted by Freak Out
Good advice. Investing 101 almost....Go with what you know.
I wasn't looking for stock recommendations (and you don't want mine either). I was curious about your overall portfolio breakdown. You wrote that you changed your risk percentage recently so I wondering what you thought a good balance was.I don't base my investment strategy off of one persons opinion. I just thought it was a good read and that's why I shared it.Is this your personal or professional opinion?
Would you mind sharing your current percentage breakdowns between stocks, bonds, gold, cash equivalents?
And I learned never to give buy recommendations.
("Lately I moved a bunch of money out of stocks into gold and other commodities as well as more into bonds. I still own some stocks in my 401k/IRA plans but have really changed my risk % as of late.")
I've got a couple of mutual funds dedicated for the kids' college fees that have done well recently. After reading the article and what you did, I was wondering if now was the time to take those profits and sock them away. I did not do this in 2000 when I had the chance and regretted it.
Also, I understand that the Motley Fool approach is buy and hold. Does this investing philosophy run throughout all their newsletters or do different newsletters connected to them advocate different investing strategies?
Ooops.
June 21, 2007
Rescue bid for Wall Street hedge funds
Suzy Jagger in New York
Blackstone, the US private equity group, was locked in rescue talks last night with a dozen lending banks, including Bear Stearns, to prevent the collapse of two hedge funds that control investments of about $20 billion (£10 billion).
Bear Stearns, the parent bank, had offered to help the hedge funds with a $1.5 billion credit facility in return for assets, but it is understood that the offer was made on condition that no assets were seized by other lenders.
Merrill Lynch, the American investment bank, yesterday published a list of assets worth $850 million held by the hedge funds that it intended to seize and auction on Wall Street last night. It wanted to sell the bonds to claw back money that it had lent to the funds.
It was not clear whether the parent bank’s offer of new credit facilities still stands.
Both hedge funds invested the bulk of their funds in risky securities linked to the sub-prime mortgage market – home loans made to borrowers with poor credit histories. That market has suffered significant losses after lenders became sloppy in chasing full documentation from potential borrowers to check details such as their proof of income, and American house prices slid.
The collapse of the funds would mark the biggest casualty yet among investment banks in the American sub-prime mortgage market.
Investors, including wealthy individuals and so-called fund of fund shareholders, became concerned in May when one of the funds showed that its value had fallen 6.75 per cent in April. That loss ballooned to 18 per cent just two weeks later.
The two hedge funds – the High Grade Structured Credit Strategies Enhanced Leverage Fund and the High Grade Structured Credit Strategies Fund – are part of the Bear Stearns banking group.
JPMorgan had also threatened to seize assets to reduce its lending but is thought to have withdrawn the threat. It is also believed that Deutsche Bank and Goldman Sachs are considering whether to grab similar assets from the funds.
Sources close to the hedge funds were uncertain about the feasibility of the funds’ future after the Merrill Lynch move.
Other sources close to some of the lenders estimated yesterday that should the two hedge funds collapse, the banks will recoup only between 60 and 70 cents of every dollar that they had lent.
Blackstone, which is advising the hedge funds on a refinancing package, started talks over the weekend with lenders to the funds.
The private equity group is seeking to persuade other lenders to the funds, including Citigroup and Barclays Capital, to take part in a rescue package.
Barclays Capital and Goldman Sachs yesterday refused to comment on whether they, too, would seize collateral to claw back money from the two Bear Stearns funds. Merrill Lynch also declined to comment. Deutsche Bank was unavailable for comment. Bear Stearns also declined to comment.
Victims
— One of the highest-profile victims of the sub-prime lending crisis has been New Century Financial, one of the biggest providers of mortgages to low-income borrowers. It filed for Chapter 11 bankruptcy protection in April. Morgan Stanley, UBS and Barclays had credit lines to the company of $3 billion, $2 billion and $1 billion respectively
— HSBC was exposed to $11 billion of bad debts through its HFC Household American sub-prime division
— 31 American sub-prime mortgage lenders have failed in the past few months on the back of more borrower defaults
C.H.U.D.
anybody have any good or bad experiences ??
http://msn.fool.com/investing/high-g...dmsnlnk0010001
LIFE IS ABOUT CHAMPIONSHIPS; I JUST REALIZED THIS. The MILWAUKEE BUCKS have won the same number of championships over the past 50 years as the Green Bay Packers. Ten years from now, who will have more championships, and who will be the fart in the wind ?
Motley Fool does advocate a buy and hold approach, but you have to do your own research and do what you feel comfortable doing. The Fool newsletter I subscribe to is Champion Funds, and it's strictly a newsletter for mutual funds. They do have newsletters for stcoks too like Rule Breakers and Hidden Gems. I'm thinking about getting one of those too. Have you ever taken a risk tolerance questionaire? It's a good step, but not the only one, to find out what type of investor you are.I wasn't looking for stock recommendations (and you don't want mine either). I was curious about your overall portfolio breakdown. You wrote that you changed your risk percentage recently so I wondering what you thought a good balance was.I don't base my investment strategy off of one persons opinion. I just thought it was a good read and that's why I shared it.Is this your personal or professional opinion?
Would you mind sharing your current percentage breakdowns between stocks, bonds, gold, cash equivalents?
And I learned never to give buy recommendations.
("Lately I moved a bunch of money out of stocks into gold and other commodities as well as more into bonds. I still own some stocks in my 401k/IRA plans but have really changed my risk % as of late.")
I've got a couple of mutual funds dedicated for the kids' college fees that have done well recently. After reading the article and what you did, I was wondering if now was the time to take those profits and sock them away. I did not do this in 2000 when I had the chance and regretted it.
Also, I understand that the Motley Fool approach is buy and hold. Does this investing philosophy run throughout all their newsletters or do different newsletters connected to them advocate different investing strategies?
I'm thinking its a good time to buy some Yahoo.....getting an itchy trigger finger. I've been watching it for some time and heard that fucking Rupert Murdoch was going to make a run at it.
Dammit Jim!
C.H.U.D.
I thought about Yahoo too but I'd like to see the stock price drop some more. Say to around $20 or lower. It's at $27.67 today. If Murdoch buys Yahoo Microsoft will probably regret it. Google has a monopoly on internet advertising and search revenue. Boy, I wish I was an employee of Google before their IPO, even if it was a Janitor.
Wasn't Yahoo at over 300 dollars at one time?
I bought Google at $200 and was scared....lol.I thought about Yahoo too but I'd like to see the stock price drop some more. Say to around $20 or lower. It's at $27.67 today. If Murdoch buys Yahoo Microsoft will probably regret it. Google has a monopoly on internet advertising and search revenue. Boy, I wish I was an employee of Google before their IPO, even if it was a Janitor.
I won't wait for it to go as low as $20. I think I'll pull the trigger on Friday but we'll see.
I'll have to check but I think you are close Partial.
C.H.U.D.
Have you thought about Sirius? Currently at $2.84. It's not a recommend over at fool because they lose more money than they make and have yet to make a profit, but I think it might be worth the risk. Dump 20k into it and hopefully watch it grow to $15 a share in 5 years. A while back I saw it around $1 a share. I don't think the company is going to go away and it could eventually be bought out by some media or internet company.
When I first heard of merger talks with XM I thought about buying a bit but have not done so. I'm still just a bit leery of it. I do own a little XM after buying some cheap a few years ago. I sold most when it hit like $36 but it has tanked since then.
Anyone get any Blackstone today? It's up 18 percent already.
C.H.U.D.
Damn chicken littles anyway..........
BIS warns of Great Depression dangers from credit spree
By Ambrose Evans-Pritchard
Last Updated: 9:02am BST 25/06/2007
The Bank for International Settlements, the world's most prestigious financial body, has warned that years of loose monetary policy has fuelled a dangerous credit bubble, leaving the global economy more vulnerable to another 1930s-style slump than generally understood.
Construction in Shanghai: BIS warns of Great Depression dangers from credit spree
The BIS said China may have repeated the disastrous errors made by Japan in the 1980s
"Virtually nobody foresaw the Great Depression of the 1930s, or the crises which affected Japan and southeast Asia in the early and late 1990s. In fact, each downturn was preceded by a period of non-inflationary growth exuberant enough to lead many commentators to suggest that a 'new era' had arrived", said the bank.
The BIS, the ultimate bank of central bankers, pointed to a confluence a worrying signs, citing mass issuance of new-fangled credit instruments, soaring levels of household debt, extreme appetite for risk shown by investors, and entrenched imbalances in the world currency system.
"Behind each set of concerns lurks the common factor of highly accommodating financial conditions. Tail events affecting the global economy might at some point have much higher costs than is commonly supposed," it said.
The BIS said China may have repeated the disastrous errors made by Japan in the 1980s when Tokyo let rip with excess liquidity.
advertisement
"The Chinese economy seems to be demonstrating very similar, disquieting symptoms," it said, citing ballooning credit, an asset boom, and "massive investments" in heavy industry.
Some 40pc of China's state-owned enterprises are loss-making, exposing the banking system to likely stress in a downturn.
It said China's growth was "unstable, unbalanced, uncoordinated and unsustainable", borrowing a line from Chinese premier Wen Jiabao
In a thinly-veiled rebuke to the US Federal Reserve, the BIS said central banks were starting to doubt the wisdom of letting asset bubbles build up on the assumption that they could safely be "cleaned up" afterwards - which was more or less the strategy pursued by former Fed chief Alan Greenspan after the dotcom bust.
It said this approach had failed in the US in 1930 and in Japan in 1991 because excess debt and investment built up in the boom years had suffocating effects.
While cutting interest rates in such a crisis may help, it has the effect of transferring wealth from creditors to debtors and "sowing the seeds for more serious problems further ahead."
The bank said it was far from clear whether the US would be able to shrug off the consequences of its latest imbalances, citing a current account deficit running at 6.5pc of GDP, a rise in US external liabilities by over $4 trillion from 2001 to 2005, and an unpredented drop in the savings rate. "The dollar clearly remains vulnerable to a sudden loss of private sector confidence," it said.
The BIS said last year's record issuance of $470bn in collateralized debt obligations (CDO), and a further $524bn in "synthetic" CDOs had effectively opened the lending taps even further. "Mortgage credit has become more available and on easier terms to borrowers almost everywhere. Only in recent months has the downside become more apparent," it said.
CDO's are bond-like packages of mortgages and other forms of debt. The BIS said banks transfer the exposure to buyers of the securities, giving them little incentive to assess risk or carry out due diligence.
Mergers and takeovers reached $4.1 trillion worldwide last year.
Leveraged buy-outs touched $753bn, with an average debt/cash flow ratio hitting a record 5:4.
"Sooner or later the credit cycle will turn and default rates will begin to rise," said the bank.
"The levels of leverage employed in private equity transactions have raised questions about their longer-term sustainability. The strategy depends on the availability of cheap funding," it said.
That may not last much longer.
Information appearing on telegraph.co.uk is the copyright of Telegraph Media Group Limited and must not be reproduced in any medium without licence. For the full copyright statement see Copyright
C.H.U.D.
If you really want a market downturn, keep letting Greenspan shoot off his mouth, pass universal healthcare and the imigration reform bill.
"Once the people find they can vote themselves money, that will herald the end of the Republic.”
– Benjamin Franklin
What does greenspan have to do with the market?
That is what gets me, the old fuck scratching his balls the wrong way sends the market down 200 pts.
C.H.U.D.
I was young in the 80’s and don’t know the history behind the collapse of the Japanese economy, but I doubt China’s situation is similar. China has a cash reserve of 1 trillion dollars, whereas the US gov’t has a debt more than that. I’m not an economics expert but don’t think China will experience a 1929 type crash, but maybe a 1987 type crash as their market is a little overheated.
Charging a subscription for ParkerRats.
I contribute my 2 cents every now and then. :P
Charging a subscription for ParkerRats.
I prefer stock owning Cracker...but, oh well. :P
EVERYONE advises a starting point is investing if your employer/company contributes or matches your contribution in a deferred comp....or whatever it may be called where you work. I have been doing that at the minimum amount for years....but this year took the plunge and tripled my contribution to get the max from the Department.
Your a smart cookie! Increase it 1% every year until you reach 10% of your salary. You'll be on your way to a nice retirement.I prefer stock owning Cracker...but, oh well. :P
EVERYONE advises a starting point is investing if your employer/company contributes or matches your contribution in a deferred comp....or whatever it may be called where you work. I have been doing that at the minimum amount for years....but this year took the plunge and tripled my contribution to get the max from the Department.
Posting Permissions
Reply With Quote
