February 28, 2011 – My Take on the Euro

Featured Trades: (MY TAKE ON THE EURO), (FXE), (SPY)   1) My Take on the Euro. Entering 2011 as the currency that everyone loved to hate, the Euro has staged a dramatic comeback, much to the chagrin of hedge fund managers and traders alike. Since January, the troubled currency has rallied ten cents from $1.28 to $1.38. Is this the beginning of something big? … [Read more...]

February 28, 2011 – Who the Oil Crisis Hurts Most

Featured Trades: (WHO THE OIL CRISIS HURTS MOST)   2) Who the Oil Crisis Hurts Most. Every time the price of oil spikes, we learn vast amounts of information about the global reach of this indispensable commodity. It's like taking a non-core elective in geology at college. So I was fascinated when I found the chart of relative sector winners and losers … [Read more...]

February 28, 2011 – Goldcorp Coins it in the Gold Trade

Featured Trades: (GOLDCORP COINS IT IN THE GOLD TRADE)   3) Goldcorp Coins it in the Gold Trade. I managed to touch base with Canadian miner Goldcorp's CEO, Charles Jeannes, who's stock I have been shamelessly pushing for the last three years (click here). When I last spoke to him two and a half years ago, back when the yellow metal was trading at $950, he made the … [Read more...]

February 25, 2011 – My Victory Lap on Oil

(SPECIAL $100 OIL ISSUE) Featured Trades: (MY VICTORY LAP ON OIL)   2) My Victory Lap on Oil. One of the boldest predictions that I made in my January 6 asset class forecast for 2011 was that oil would soon hit $100/barrel (click here for the link). My precise words were 'Probably $30 of the current $90 price reflects monetary demand, on top of $60 worth of … [Read more...]

February 25, 2011 – The True Cost of Oil

(SPECIAL $100 OIL ISSUE) Featured Trades: (THE TRUE COST OF OIL)   3) The True Cost of Oil. I received some questions on my recent solar pieces as to whether I minded paying more money for 'green' power. My answer is 'hell no,' and I'll tell you why. My annual electric bill comes to $1,500 a year. Since the California power authorities have set a goal of 33% … [Read more...]

February 24, 2011 – The True Cost of High Oil

Featured Trades: (THE TRUE COST OF HIGH OIL), (OIL), (USO) 1) The True Cost of High Oil. Economists are furiously downsizing their economic growth forecasts for 2011 in the wake of the oil price spike, both for the US and for the world at large. Since last week, West Texas crude prices have soared $12 from $86 to $98. Each $1 increase in the price of oil jumps gasoline … [Read more...]

February 24, 2011 – How Far Will the Market Fall?

Featured Trades: (HOW FAR WILL THE MARKETS FALL?), (VIX), (SPX), (SPY)   2) How Far Will the Market Fall? Now that we are solidly in 'RISK OFF' mode, traders, managers, and investors are asking how much downside we are looking at. It is safe to say that those who were piling on longs with reckless abandon are now potentially staring into the depths of a great … [Read more...]

February 24, 2011 – Quote of the Day

'China has been doing everything right for the last ten years. Our government is made up of 'C' students that were political science majors, whereas, the Chinese government is made up of PhD's that were educated at Cambridge and Harvard,' said one Washington observer. … [Read more...]

February 23, 2011 – The Mad Hedge Fund Trader’s April 28 Phoenix Luncheon

Featured Trades: (PHOENIX STRATEGY LUNCHEON)   1) The Mad Hedge Fund Trader's April 28 Phoenix Luncheon. Come join me for lunch for the Mad Hedge Fund Trader's Global Strategy Update, which I will be conducting in Phoenix, Arizona on Thursday, April 28, 2011. A three course lunch will be followed by a 45 minute PowerPoint presentation and a 30 minute question and … [Read more...]

February 23, 2011 – A Buying Opportunity is Setting Up for the Ags

Featured Trades: (BUY THE DIP IN THE AGS), (DBA), (CORN), (MOS), (POT), (AGU), (ANDE), (CPO)   3) A Buying Opportunity is Setting Up for the Ags. In January, I wimped out of my hefty long position in the grain ETF (JJG), hoping to sidestep a potential sell off going into a dreaded US Department of Agriculture crop report, which last year triggered limit down moves. The … [Read more...]

February 22, 2011 – The Resurrection of Peak Oil

(SPECIAL PEAK OIL ISSUE) Featured Trades: (XOM), (BP), (COP), (OXY), (OIH), (DIG), (USO) 1) The Resurrection of Peak Oil. It has been a long wait for 'peak oilers,' whose passionate belief is that the world will run out of oil in coming years, sending prices through the roof. This splinter religion came into being in 1956 when M. King Hubbert produced some simple … [Read more...]

February 21, 2011 – Reflections on Morgan Stanley’s 75th Anniversary

Featured Trades: (MORGAN STANLEY), (MS)   1) Reflections on Morgan Stanley's 75th Anniversary. The three elder statesmen I saw on TV ringing the opening bell at the NYSE couldn't have been more representative of the evolution of Morgan Stanley (MS) over the past three quarters of a century. When I joined just after the 35th anniversary, it was a small, white shoe … [Read more...]

February 21, 2011 – Thank Goodness I Don’t Live in Sweden!

Featured Trades: (THANK GOODNESS I DON'T LIVE IN SWEDEN)   2) Thank Goodness I Don't Live in Sweden! I pulled the chart below off of Paul Kedrosky's ever insightful website, Infectious Greed, showing world tax rates as a percentage of GDP for the past 40 years. Sweden suffers the world's heaviest tax burden at 51%, compared to only 27% in the US. The US has among … [Read more...]

February 21, 2011 – Learning to Love Hedge Funds

Featured Trades: (LEARNING TO LOVE HEDGE FUNDS)   3) Learning to Love Hedge Funds. The Wall Street Journal has put together the best history of hedge funds I have found so far. They start with the legendary Fortune Magazine editor, Winslow Jones, who created the first fund out of a shabby office on Broadway in 1948, and generated monster returns over the next 20 … [Read more...]

February 21, 2011 – The ‘Population Bomb’ Echoes

Featured Trades: (POPULATION BOMB ECHOES)   4) The 'Population Bomb' Echoes. Pack your portfolios with agricultural plays like Potash (POT), Mosaic (MOS), and Agrium (AGU) if Dr. Paul Ehrlich is just partially right about the impending collapse in the world's food supply. You might even throw in long positions in wheat, corn, soybeans, and rice. The never dull, … [Read more...]

February 18, 2011 – March 31 New York Global Strategy Luncheon

Featured Trades: (NEW YORK STRATEGY LUNCHEON) 1) March 31 New York Global Strategy Luncheon. The Mad Hedge Fund Trader's Global Strategy Update will be held at 12:00 noon on Thursday, March 31, 2011. The event will be held at an exclusive private club on Central Park South.  A three course lunch will be followed by a 30 minute PowerPoint presentation and a 45 minute … [Read more...]

February 18, 2011 -My Near Miss With Cisco

Featured Trades: (MY NEAR MISS WITH CISCO) 2) My Near Miss With Cisco. My predatory instinct as a scavenger and bottom feeder is coming to the fore once again. After building up expectations for a blowout quarter, Cisco Systems disappointed once again, prompting traders to trash the stock by 15% in one day. Call me greedy, but my risk averse nature prompted me to … [Read more...]

February 18, 2011 – Testimonial

3) Testimonial. 'We view The Mad Hedge Fund Trader as a vital resource that helps us focus on major market trends that are most likely to make money over time. It is a resource that helps us filter out the daily noise in various markets and the mostly irrelevant commentary of TV's talking heads. Unlike many newsletters that focus on one strategy or asset class The … [Read more...]

February 18, 2011 – Quote of the Day

'Changes in consumption stemming from per capita income rises from $1,000 a year to $5,000, as you are seeing in India, or $5,000 to $10,000, as you are seeing in China, is a very different kind of consumption. It is much more commodities heavy, it is food heavy, it draws a lot more on water supplies,' said Ian Bremmer, president of the Eurasia Group, an New York Based … [Read more...]

February 17, 2011 – Global Strategy Review With OptionMonster’s Pete Najarian

Featured Trades: (THE PETE NAJARIAN/JOHN THOMAS SMACKDOWN)   1) Global Strategy Review With OptionMonster's Pete Najarian. Please join John Thomas, The Mad Hedge Fund Trader, and OptionMonster's Pete Najarian for a free live webinar on Thursday, February 17 at 12:00 noon EST. It will be a no holds barred, mano a mano, smack down where we will debate the future … [Read more...]

February 17, 2011 – A Rest for the Treasury Bond Sell Off

Featured Trades: (THE TREASURY BOND SELL OFF), (TBT), (TLT) 2) A Rest for the Treasury Bond Sell Off. The Great Treasury Bond Sell Off, which has been running now for nearly six months, may be about to take a rest. Take a look at the chart below put out by my friends at StockCharts.com. It shows that the iShares Barclays 20+ Year Treasury Bond ETF (TLT), the single … [Read more...]

February 15, 2011 – Orlando Strategy Luncheon Review

SPECIAL FLORIDA ISSUE Featured Trades: (ORLANDO STRATEGY LUNCHEON REVIEW) 1) Orlando Strategy Luncheon Review. Now is the greatest time ever to buy a Caterpillar D9 heavy bulldozer. That was my conclusion after visiting Ritchie's Auctioneers, half way between Orlando and Tampa, Florida, which offers hundreds of these giant machines, along with enough steam … [Read more...]

February 15, 2011 – The San Francisco Money Show

SPECIAL FLORIDA ISSUE Featured Trades: (WORLD MONEY SHOW) 2) The San Francisco Money Show. I attended the Woodstock of investment conferences last week, the World Money Show at the Gaylord Palms Resort near Orlando, Florida. Run with military efficiency that only General George S. Patton could have appreciated, it offered a multi ring circus of traders, foreign … [Read more...]

February 15, 2011 – They're Not Celebrating in Celebration

SPECIAL FLORIDA ISSUE Featured Trades: (DESPAIR IN CELEBRATION) 3) They're Not Celebrating in Celebration. A search for a nearby bank took me to the surreal suburb of Celebration, Florida, a city developed by the Disney people during the mid-1990's. Created to evoke small town USA circa 1940, the berg tastefully replicates an America from the bucolic past, … [Read more...]

February 15, 2011 – Quote of the Day

'It's very difficult to navigate a business through a paradigm shift. You must hard wire your system to second guess all the time, questioning what is next, and then what is next. You've got to retain optionality for both investment portfolios and the business you run to navigate this well,' said Mohamed El-Erian, co-chairman of the bond house PIMCO. … [Read more...]

February 14, 2011 – Dinner With Joseph Stiglitz

Featured Trades: (DINNER WITH JOSEPH STIGLITZ) 2) Dinner With Joseph Stiglitz. The great thing about interviewing Joseph Stiglitz over dinner is that you don't have to ask any questions.  You just turn him on and he spits out one zinger after another. And he does this in a kibitzing, wizened, grandfatherly manner like one would expect from a character that just walked … [Read more...]

February 11, 2011 – April 8 Paris Strategy Luncheon

Featured Trades: (PARIS STRATEGY LUNCHEON) 1) April 8 Paris Strategy Luncheon. Come join me for lunch for the Mad Hedge Fund Trader's Global Strategy Update, which I will be conducting in Paris on Friday, April 8, 2011. A three course lunch will be followed by a 45 minute PowerPoint presentation and a 45 minute question and answer period. I'll be giving you my … [Read more...]

February 11, 2011 – China’s Long and Winding Road

Featured Trades: (CHINA'S ENVIRONMENTAL MOVEMENT)   2) China's Long and Winding Road. I spent the evening speaking to Gao Jie, a Beijing civil judge who left the bench to join China's growing environmental movement when her kids came home from school one day coughing and wheezing. You only have to inhale in the capitol city these days to understand that they … [Read more...]

February 10, 2011 – The Real Estate Market in 2030

Featured Trades: (REAL ESTATE IN 2030)   1) The Real Estate Market in 2030. A number of analysts, and even some of those in the real estate industry, are finally coming around to the depressing conclusion that there will never be a recovery in residential real estate. Long time readers of this letter know too well that I have been hugely negative on the sector … [Read more...]

February 10, 2011 – The One Bright Spot in Real Estate

Featured Trades: (THE ONE BRIGHT SPOT IN REAL ESTATE) 3) The One Bright Spot in Real Estate.After my weekly dump on residential real estate, I feel obliged to reveal one corner of this beleaguered market that might actually make sense. By 2050 the population of California will soar from 37 million to 50 million, and that of the US from 300 million to 400 million, … [Read more...]

February 9, 2011 – Peter F. Drucker on Management

Featured Trades: (PETER DRUCKER ON MANAGEMENT) 2) Peter F. Drucker on Management. If you have been living in a cave for the last 71 years and missed the work of management guru, Peter F. Drucker, here is your chance to catch up. I just finished reading The Essential Drucker, a weighty tome of 368 pages which summarized the high points and pearls of wisdom of the … [Read more...]

February 9, 2011 – The Coming Takeover Wars

Featured Trades: (THE COMING TAKEOVER WARS) 3) The Coming Takeover Wars. The spate of takeover bids we have witnessed recently, the attempted BHP Billiton (BHP)-Potash (POT) deal, the Sanofi Aventis (SNY)-Genzyme (GENZ) deal, and Intel's (INTC) acquisition of Infineon Technologies (IFX), is telling the rest of us reams about the broader market. Virtually all of the … [Read more...]

February 9, 2011 – Be Careful Who You Snitch On

Featured Trades: (BE CAREFUL WHO YOU SNITCH ON) 4) Be Careful Who You Snitch On. Buried in the recently passed Dodd-Frank financial reform bill are massive financial rewards for turning in your boss. The SEC is hoping that multimillion dollar rewards amounting to 10%-30% of sanction amounts will drive a stampede of whistleblowers to their doors with evidence of … [Read more...]

February 8, 2011 – Reading the Nonfarm Payroll Tea Leaves

Featured Trades: (JANUARY NONFARM PAYROLL)   1) Reading the Nonfarm Payroll Tea Leaves. Lifetime followers of the monthly nonfarm payroll report were more than a little amused by the Friday numbers, which could not have been more contradictory, conflicting, and confusing. The headline figure showed a gain of a paltry 36,000, yet the unemployment rate plunged … [Read more...]

February 8, 2011 – India is Catching Up With China

Featured Trades: (CHINA VERSUS INDIA), (FXI), (TTM), (INP), (PIN), (EPI) 2) India is Catching Up With China. When I first visited Calcutta in 1976, more than 800,000 people were sleeping on the sidewalks, I was hauled everywhere by a very lean, barefoot rickshaw driver, and drinking the water out of a tap was tantamount to committing suicide. Some 34 years later, and … [Read more...]

February 8, 2011 – Getting Something for Nothing

Featured Trades: (NISSAN LEAF), (NSANY) 3) Getting Something for Nothing. I just contracted to buy all the gasoline I want at 14 cents a gallon. No, I have not struck oil in my backyard, or come into an inheritance from a long lost Kuwaiti relative. That is the de facto price that PG&E is billing me for a full charge on the all-electric Nissan Leaf that will be … [Read more...]

February 8, 2011 – Quote of the Day

'If you can get a dividend higher than the yield on ten year debt, it's an opportunity we haven't seen in our lifetime. On a five year horizon, investing in large multinationals with high dividends will have a large payday' said Lawrence Fink, CEO of BlackRock. … [Read more...]

February 7, 2011 – Who Says Hedge Funds Aren’t Adding Value?

Featured Trades: (HEDGE FUNDS) 2) Who Says Hedge Funds Aren't Adding Value? According to my old friend, Rick Sopher, chairman of LCH Investments in London, the top ten hedge funds have earned $153 billion for their investors since inception. John Paulson's fund alone, which made an absolute killing by shorting subprime mortgage debt instruments going into the housing … [Read more...]

February 7, 2011 – Murray Sayle: The Passing of a Giant in Journalism

Featured Trades: (MURRAY SAYLE) 4) Murray Sayle: The Passing of a Giant in Journalism. I was saddened to hear of the death of my close friend, the Australian, Murray Sayle, after a long battle with Parkinson's disease at the age of 84. Murray was one of the giants of journalism in the second half of the 20th century. He started by editing the newspaper at University … [Read more...]

February 4, 2011 – Last Chance to Sign Up for The Mad Hedge Fund Trader February 11 Orlando Strategy Luncheon

Featured Trades: (ORLANDO STRATEGY LUNCHEON)   1) Last Chance to Sign Up for The Mad Hedge Fund Trader February 11 Orlando Strategy Luncheon. Come join me for lunch for the Mad Hedge Fund Trader's Global Strategy Update, which I will be conducting in Orlando, Florida on Friday, February 11, 2011. A three course lunch will be followed by a 45 minute PowerPoint … [Read more...]

February 3, 2011 – Ringing in the Year of the Rabbit

Featured Trades: (THE YEAR OF THE RABBIT), (FXI), (SSEC), (CYB) 1) Ringing in the Year of the Rabbit. An invitation to the Chinese consulate for their New Year's party is always one of the most sought after invitations in the Lilliputan diplomatic community of San Francisco. Welcoming the Year of the Rabbit were true Mandarins bedecked in elegant silk brocade, rubbing … [Read more...]

February 3, 2011 – An Insider’s Review of Wall Street: Money Never Sleeps

Featured Trades: (WALL STREET) 3) An Insider's Review of Wall Street: Money Never Sleeps. One of the great things about flying first class is that you often get to meet some pretty interesting people. During the early eighties, I found myself on a flight from Los Angles to New York sitting next to an unknown aspiring young director named Oliver Stone, who was on his … [Read more...]

February 2, 2011 – Ponzi Schemes

Featured Trades: (PONZI SCHEMES) 2) I spent a sad and depressing, but highly instructional evening with Dr. Stephen Greenspan, who had just lost most of his personal fortune with Bernie Madoff. The University of Connecticut psychology professor had poured the bulk of his savings into Sandra Mansky's Tremont feeder fund; receiving convincing trade confirms and rock … [Read more...]

February 2, 2011 – More Insights on Egypt

Featured Trades: (MORE ON EGYPT) 3) More Insights on Egypt. I had dinner with Neil MacFarquhar, UN Bureau Chief and former Cairo Bureau Chief for the New York Times, to get the latest view of what is happening on the Arab 'street.' MacFarquhar grew up in Libya around the time I tried to visit the country in the sixties (I was turned away at the Tunisian … [Read more...]

February 2, 2011 – The Long View on Emerging Markets

Featured Trades: (EWZ), (RSX), (PIN), (FXI) 4) The Long View on Emerging Markets. I managed to catch a few comments in the distinct northern accent of Jim O'Neil, the fabled analyst who invented the 'BRIC' term, and who has been kicked upstairs to the chairman's seat at Goldman Sachs International (GS) in London. Jim thinks that it is still the early … [Read more...]

February 1, 2011 – Thoughts on Egypt

(SPECIAL MIDDLE EAST ISSUE) Featured Trades: (THOUGHTS ON EGYPT)   1) Thoughts on Egypt. When I first visited Egypt in 1977, they tried to kill me. I was accompanying US Secretary of State Henry Kissinger on an Air Force jet as part of his shuttle diplomacy between Tel Aviv and Cairo. Every Arab terrorist organization had vowed to shoot our plane down. When we … [Read more...]