Al's Insights – Fri 4 May, 2012

Interesting Market Discussion with Rick Ackerman

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Featuring:
Al KorelinRick Ackerman

Comments:
  1. On May 4, 2012 at 12:35 pm,
    going down fast says:

    Big Al -

    I am guessing that the principal reason for the Dow’s down movement today has to do with the imminent national elections in France and Greece. It appears that the Socialist challenger in France has the upper hand and he is pushing “growth” as opposed to austerity. This may isolate Germany in promoting the austerity agenda. With an already unstable situation in Euroland a shock to the current leadership may ignite some unpleasant and unpredictable developments.

    • On May 4, 2012 at 4:42 pm,
      Big Al says:

      HI going down fast,

      Two things will be very interesting.

      First of all, who wins the election and, obviously, secondly how that election affects the economic perception.

      Big Al

  2. On May 4, 2012 at 12:45 pm,
    Dai Uy says:

    AL:

    I viewed an interesting pie chart this morning (I forgot what website is was on but one which I deemed to be reliable).

    It resulted from a survey of Americans as to what investment choice they thought was the best i.e conventional stocks, bonds, real estate, gold etc. 34% of those surveyed opined that they thought that gold was the best choice. That is not to say that they were necessarily buyers as evidenced by gold prices but perhaps it reflects that attitudes are indeed changing………………….

    BTW: Will be on the Island starting the week of June 10, the Good Lord providing. Let me know if you’ll be in the neighborhood………….May have a “Cougar” treat for you and Rog………….

    • On May 4, 2012 at 4:43 pm,
      Big Al says:

      Perfect!

      The pie chart was the results of a poll by Gallup just a day or so ago.

      I will definitely let you know if we are there.

      Best,

      Big Al

  3. On May 4, 2012 at 12:51 pm,
    Lynn says:
    • On May 4, 2012 at 1:44 pm,
      Peter says:

      It’s interesting to see that those who see gold as the best investment has declined from 34% in 2011 to 28% this year. Sentiments are a’changin’. The prolonged “correction” undoubtedly has something to do with this.

      • On May 4, 2012 at 4:45 pm,
        Big Al says:

        Hi Peter,

        I believe that the term was not the “best” but the “safest”.

        Best,

        Big Al

        • On May 4, 2012 at 5:43 pm,
          Peter says:

          Semantics…

          • On May 4, 2012 at 8:33 pm,
            castanheiro says:

            Hi Peter,
            Not semantics at all. It depends on what your objectives are. If you’re looking for long term ‘safety’, as the safest preservation of your ‘assets’, then gold, for many people is deemed to be the safest. If you’re talking about the ‘best’, well…do mean short term, medium term, long term? Do you mean the best in terms of highest potential gains, or most secure? There are many questions to be asked, so clearly it is not semantics. Define your terms and you will see that words mean things, and different people use words to mean different things. There are shades of meaning, slight or major variation. You over simplify the arguement when you say if all boils down to semantics. Proper communication and understanding requires much more work than that.

  4. On May 4, 2012 at 12:56 pm,
    Brian says:

    As mentioned above by Dal Uy, a link to the survey of long-term investment choices (Gallup poll, 27April2012). Includes an interesting demographic analysis.

    http://www.gallup.com/poll/154232/Gold-Americans-Top-Pick-Among-Long-Term-Investments.aspx

    • On May 4, 2012 at 1:50 pm,
      Dai Uy says:

      Brian and Peter:

      Thanks for the correction. I thought it was 34% instead of 28%.. Damn dementia!… In any event, gold still a large category.

    • On May 4, 2012 at 4:46 pm,
      Big Al says:

      Hi Brian,

      Not really a surprising demographic. Thanks for bring that up.

      Best,

      Big Al

  5. On May 4, 2012 at 12:58 pm,
    Brian says:

    Lynn ~ Beat me by 5 minutes

  6. On May 4, 2012 at 1:02 pm,
    Mark Alan says:

    This has got to be one of THE MOST deplorable statements I have ever heard regarding gold! This is ABSOLUTELY DEGRADING and prejudice. How do these guys get respect?

    http://www.zerohedge.com/news/charlie-munger-civilzied-people-dont-buy-gold-only-pre-holocaust-jews-sew-it-their-garments

    • On May 4, 2012 at 1:25 pm,
      Irishtony says:

      MARK A………….That “THING” ought to be taking outside & shot with balls of his own …S**T.

    • On May 4, 2012 at 3:39 pm,
      Marc says:

      Mark A.,
      I am not saying this out of hostility or defensive posturing…but that comment is EXTREMELY ignorant of current events surrounding macro-economics and geo-politics. This guy should be ashamed of himself. What a irrelevant fool. To use Doc’s expression of Warren Buffett is today’s marketplace!
      Marc

    • On May 4, 2012 at 4:48 pm,
      Big Al says:

      Ignorance is bliss, Mark Alan.

      Big Al

      • On February 3, 2014 at 7:02 pm,
        Ramos says:

        Super jazzed about getting that knwhow-o.

    • On May 4, 2012 at 5:10 pm,
      MissiveDuTexas says:

      This idiot should also realize the people had been disarmed way before they had to hide their property from the authorities.

      Nazi Germany & Occupied Europe – Law on Firearms & Ammun., 1928 – Weapon Law, March 18, 1938 – Regulations against Jews, 1938 –
      •Registration & Licensing
      •Stricter handgun laws
      •Ban on possession

      http://jpfo.org/filegen-a-m/deathgc.htm#chart

    • On May 4, 2012 at 10:03 pm,
      John W. Robertson says:

      OK. Now we know it’s Charlie who’s going to take Buffet’s place. He’s trying to be witty. Trying.

      Yes, I agree it’s deplorable. It’s also stupid. I have to have respect for the wealth Buffet and his 50yr+ followers have generated for themselves. It’s more than I’ll ever have. But the Chinese are buying more gold than Warren is worth, so I’m with China on this one.

      • On May 5, 2012 at 10:32 am,
        Big Al says:

        I am with you, as you know, John W,

        Big Al

  7. On May 4, 2012 at 1:03 pm,
    Jerry O^OTB says:

    GOLD IS NOT GOING DOWN ANY FURTHER……GOLD SHOULD BE $10,000 AN OZ…..
    IT IS ALL ABOUT THE PAPER MARKET…..

    TELL” IRISH ” TO STOP BARKING…..HE’LL GET HIS ,…..G…BEER….

    • On May 4, 2012 at 1:26 pm,
      Irishtony says:

      BOW WOW WUFWUF…….DRINK FECK YEAH

      • On May 4, 2012 at 1:46 pm,
        Jerry O^OTB says:

        IRISH…HOW YA DOING….HOPE YOU HAVE A GREAT WEEK END….

        • On May 4, 2012 at 4:51 pm,
          Big Al says:

          Drinking?

          Now that you mention it, I am meeting Bruce Bragagnolo, his wife Pam, Gary and Valia Cope and Ben and Nancy Whiting in about 40 minutes. Oh yeah, the love of my life will also be there!

          Big Al

          • On May 5, 2012 at 4:26 pm,
            Jerry O^OTB says:

            PARTY ANIMAL…… OR IS THAT PARTY ” AL” IMAL

  8. On May 4, 2012 at 1:33 pm,
    Larry says:

    Mark, thanks for the heads up on another brilliant observation by the uber rich Charlie Munger. He is part of the cabla who wants to absorb the middle class wealth and use for their own purposes. He will suck as many potential gold investors away so as to insure the elites wealth control for coming generations of elites.

    • On May 4, 2012 at 1:36 pm,
      Mark Alan says:

      Howdy Larry

      What chaps my arse is the fact that the media worships this guy and his employer like they are the ONLY voice of reason. If they were so “civilized” then how come BERKSHIRE HATHWAY underperformed the S&P for the last three years? What geniuses! Some civilized ideology.

      • On May 4, 2012 at 1:50 pm,
        Richard says:

        I listened to Munger and had a good chuckle. I then tweeted CNBC and told them how Buffett/Munger are pretty irrelevant today. These guys were great in a normal expanding economy but are like “fish out of water” in the climate we have today. They and their companies are going to be slaughtered in the next cyclical bear market which is upon us.

        • On May 4, 2012 at 2:09 pm,
          Mark Alan says:

          They deserve it too. I like how Buffet goes around telling everyone that derivatives are “nuclear” yet is responsible for some of them. If Buffet is such a great investor, how come he couldn’t see the market crash of 2008 coming? We have to learn to adapt and change and be constantly vigilant with the changing market tides.

          • On May 4, 2012 at 3:41 pm,
            Marc says:

            You bet your buns (a___) they deserve it.

        • On May 4, 2012 at 3:11 pm,
          Marc says:

          Doc,
          They ARE “irrelevant today”….I think you are right on. They are ‘fish out of water”. Great, great comments on the current market conditions.
          All the best,
          Marc

          • On May 4, 2012 at 4:57 pm,
            Big Al says:

            The real point, Marc, is that we are in completely uncharted waters today.

            Big Al

        • On May 4, 2012 at 10:23 pm,
          John W. Robertson says:

          Richard, you’re bang-on, and this is something I like to tell Buffetteers. Warren Buffet made his first $1 million in 1954. That was a pile back then. He learned to buy and hold…during several secular bulls, when the golden-years of post WWII and Lend-Lease payback were making the US heaps of money. No question he deserves credit…no one else was buying and holding like Warren.

          It’s just all these bimbos going to Omaha, automatically buying Coke and Abbott Labs, just because Warren owns them. Did you buy them in 1970? Did you buy them at .30 option prices, the way Warren got them because he wrestled himself onto the boards? No?? Then what’s the point?

          Suppose a company is worth $100/share today, and you bought it at $50/share. Hey, gorgeous, great trade. You made 100% on your money. Now suppose you bought it at $10/share. Well that would be 1000%. Now suppose you were granted 100,000 options of a stock at .30/share, just like Warren. That’s a 33,333% return. See how it goes up exponentially? That’s Buffet’s real secret. He got a Columbia education from Ben Graham which helped him learn how to get onto the board of failing companies and turn them around for a few million options worth pennies/share. Again, I’m not slamming Buffet per se. He did what was smart for the time. But no one is going to make it rich by copying him today. What he did was accomplished during the best 50 years of stock market history, at any time and any where in history. Some of his holdings will hold-up to inflation OK, but they aren’t all recession (or depression) proof. Well, who knows, maybe Nebraska Furniture Mart will tide him over.

  9. On May 4, 2012 at 1:37 pm,
    shawn says:

    Hi Al, I watched a program the other night on PBS and it was about the changing face of US manufacturing, It started out showing how in 1980 there were 3 x the number of auto plants than they have now but car production has stayed the same while decreasing employees by over 70%. I can tell you I have been employed in line changes at these plants and if you go back to the 80′s they would have 400+ electricians working on line changeovers that now can be done with 60 working about 1/4 of the time. There simply won’t be the jobs in manufacturing like was prevalent in the past and if you think this is a nightmare for us the Asians are going to get really busted because they depend on having so many more jobs that won’t be around. The new technologies are destroying conventional manufacturing models. Like Desi Arnaz say’s ” You’ve got some splainin to do Lucy.”

    • On May 4, 2012 at 4:58 pm,
      Big Al says:

      Yep, that was on process in the evolution of America that really hurt the country!

      Big Al

    • On May 4, 2012 at 5:05 pm,
      MissiveDuTexas says:

      China has had a “most favored trading nation” with the US, and manufacturing has been moving out of this country ever since. I used to be a fan of Adam Smith`s “Wealth of Nations”, but since I’ve been exposed to “Raw Materials Economics”,

      I believe it is a question of national security to have a full employment, zero inflation policy. However, a debt based monetary system cannot be used for that goal.

      • On May 4, 2012 at 5:07 pm,
        MissiveDuTexas says:

        “…but since I’ve been exposed to “Raw Materials Economics”, I view his exposes as only part of the puzzle.

      • On May 5, 2012 at 10:35 am,
        Big Al says:

        Good Morning Missive,

        Your second paragraph is very, very good information.

        Big Al

  10. On May 4, 2012 at 2:01 pm,
    James says:

    Sell in May and go away.
    When Operation Twist is over the next round of QE called Mission Impossible will start. The Mission is to keep this phony recovery that is not a recovery afloat while trying to hold off the bond vigilantes. Impossible. I am baffled by Gold??? Anyone’s guess is as good as mine. Union Rags wins the Kentucky Derby!

    • On May 4, 2012 at 4:59 pm,
      Big Al says:

      I think that it is absolutely amazing James that gold prices are hanging in there as much as they are!

      Big Al