Now that Apple‘s (AAPL) stock has crashed more than 35% from its peak, most Wall Street analysts are frantically cutting their estimates and reducing their price targets.
Most of them still rate the stock a “buy” so it’s not as though everyone has given up and thrown in the towel.
This herd-like analyst behavior often frustrates critics, who complain that Wall Street analysts usually miss big turning points like Apple’s.
In the case of [...]
From Pragmatic Capitalism:
I missed this piece on CBS Money Watch last week and wanted to pass it along in case you did as well. It lists John Bogle’s 10 rules of investing.
Bogle is truly a living legend, so his insights are a great addition to some other “rules lists” that I’ve compiled below…
1. Remember reversion to the mean. What’s hot today isn’t likely to be hot tomorrow. The stock market [...]
From Washington’s Blog:
We have overwhelming numbers. If we worked together we would win.
Why aren’t we?
A large reason that we are failing is that people are copping out… by adopting a cynical attitude.
Many of us pretend that we are too smart to think anything can change. Too smart to get emotionally involved in the destruction of our prosperity or our liberties.
… We’ve previously noted:
The ironic thing is that if all of [...]
There’s a bewildering amount of advice on how to invest. People divide into camps, schools and strategies, then proselytize on the internet, in books, and on televisions.
It’s worthwhile, especially in today’s volatile markets, to take a look at what’s actually worked, as opposed to what people claim works.
We’ve collected some of the finest wisdom on markets from the most respected and successful investors, past and present.
John Templeton: This time is [...]
When they follow the flock, they are not so much copying each other as acting on their own out of a sense of survival, London researchers found.
Scientists tested the ‘selfish herd’ hypothesis by strapping GPS satellite tracking devices to the backs of animals being rounded up by a sheep dog.
They confirmed that the sheep’s herding behaviour was governed by an individual drive to escape danger.
A sheep at the centre of [...]
Pig Herd Fatally Electrocuted
Three cows electrocuted in Beaver County
2 electrocuted on coming into contact with wire fence
According to Missouri government, each year about 1000 Missouri citizens are killed by electrocution:
There are approximately 5,900,000 people in Missouri:
Therefore, probability of electrocution of randomly selected Missouri citizen = 1000/5,900,000 =
Probability that 3 would be electrocuted in the Ozarks on the same weekend = 0.000160492^3 =
4.869E-12 or .000000000005
Extremely highly unlikely.
But look at all [...]
DALLAS, Texas (Reuters) – A mystery is ahoof in Texas farm country where cattle have dropped dead while grazing, puzzling scientists who say it appears an unusual combination of circumstances have turned pastures toxic.
“We don’t know probably all we need to know currently. We do know the cattle died from prussic acid poisoning and we know the grass tested positive for prussic acid,” said Warner. “It is the same as [...]
The Chinese hope to be selling the milk in super markets within three years. The milk is identical to human milk and has the same immune enhancing and antibacterial features as breast milk according to scientists at the Agricultural University in Beijing.
There is already a transgenic herd of 300. It was bred by inserting human genes into cloned bovine embryos. These were then implanted in cows. The milk is still [...]
It has long been our position at The Automatic Earth that North America is collectively dreaming with regard to unconventional natural gas. While gas is undeniably there, the Energy Returned On Energy Invested (EROEI) is dramatically lower than for conventional supplies. The critical nature of EROEI has been widely ignored, but will ultimately determine what is and is not an energy source, and shale gas is going to fail the test.
As we [...]
One person has been killed and seven others injured in a shooting at Toronto’s main central shopping centre, Canadian police have said.
Witnesses described scenes of panic after gunfire broke out in the food court of the Eaton Centre.
“A herd of people were just running toward us, screaming, running, freaking out,” said one shopper.
Police said two of the injured were in a critical condition and warned that they were still hunting [...]
From Pragmatic Capitalism:
The current market correction should not come as a surprise to any one. There has been consistent and substantial evidence that the rally that began last October was unsustainable. We discussed the coming correction beginning in March. The question now is becoming whether the current correction is over or is there more to come?
… Bob Farrell’s rule #9 is: “When all experts and forecasts agree — something else [...]
by Lance Roberts of StreetTalk Advisors
Risk Ratio Indicating More Correction Coming
The current market correction should not come as a surprise to any one. There has been consistent and substantial evidence that the rally that began last October was unsustainable. We discussed the coming correction beginning in March (see here, here, here and here ). The question now is becoming whether the current correction is over or is there more to come?
It always fascinates me to watch the [...]
From The Stock Sage:
Did you guys hear that being contrarian is the cool thing these days? Everyone wants to be a contrarian and “fade the herd”. We all know the axioms about crowds being wrong and fading the dumb money etc. etc. The problem is that all this fading has gotten to such an extreme that I have begun to joke about “fading the fading faders”. In all seriousness, a [...]
Modern investing offers the promise that investors who “do their homework” and use data more intelligently than the herd can gain a valuable edge. But what if the underlying data available to the investing public is fundamentally flawed?
The federal government agencies that issue headline data and the mainstream media that reprints the data without skeptical analysis would have us believe that these indicators — the unemployment rate and the consumer [...]
Ridiculous as our market volatility might seem to an intelligent Martian, it is our reality and everyone loves to trot out the “quote” attributed to Keynes (but never documented): “The market can stay irrational longer than the investor can stay solvent.” For us agents, he might better have said “The market can stay irrational longer than the client can stay patient.”
As one may have guessed by now, the topic [...]
The train line, which runs between Umeå and Lycksele, has been responsible for the deaths of hundreds of reindeer over the last three months, when the unfortunate animals have wandered onto the tracks.
Finding a dead reindeer or one that is injured and needs to be euthanized is a daily occurrence for reindeer owner, Per-Mikael Jonsson, who is forced to put down many injured reindeer fearing that their internal damages may [...]
by Charles Hugh Smith from Of Two Minds
The Grand Game of Perception Management
The economy will expand if you believe it is expanding–because you’ll be “animal spirited” into buying a lot of stuff on credit that you can’t afford.
It all boils down to perception–that’s the insight at the heart of the Grand Game of Perception Management. Economists speak of magical “animal spirits” that fuel economic expansion, but this is simply a colorful [...]
Earlier, You Heard It from Jeff Gundlach, whom one can not accuse (at least not yet) of sleeping on his laurels and/or being a broken watch, who told his listeners to “reduce risk right now” especially in the frenzied momo stocks. Now, it is David Rosenberg’s turn who tries to refute the presiding transitory dogma that ‘things are ok” and that a Greek default will be contained (no, it won’t be, and if [...]
(credit: Oren Liebermann)
By Oren Liebermann
PHILADELPHIA (CBS) — At Cappuccio’s Meats in the Italian Market, the cuts of beef are cutting into the profits.
“Every week when I talk to my suppliers, I’m amazed by how much it’s going up,” said owner Domenick Crimi.
Beef prices soared more than 10 percent last year according to the Department of Agriculture, and they will likely go up at least another 5 percent this year.
“It bumps [...]
by Lee Adler
So am I. I was hoping to get it posted tonight, but the economic chart service I use is having “issues.” As a result the ETA for this report now looks to be tomorrow afternoon. I apologize for the delay.
I can tell you that the composite liquidity indicator continues to mark time. It had a little surge during the week ended November 30, but that was reversed [...]
Energy Secretary Steven Chu acknowledged Thursday making the final decision to allow a struggling solar company to continue receiving taxpayer money after it had technically defaulted on a $535 million federal loan guaranteed by his agency.
Chu spokesman Damien LaVera said in a statement that the secretary approved the restructuring agreement for Solyndra because it gave the company “the best possible chance to succeed in [...]
With the only debate consuming the broader investing public these days (and for the past several years) being whether or not entity/bank/country X will receive a taxpayer bailout or not, some forget that there are actual fundamental, cash flow-based drivers to making economic decisions. Key among these has always been whether to rent or buy that most capital intensive purchase (for most): a [...]
While the massive drubbing across risk assets has modestly subsided, the global investing herd has finally realized that in the absence of shifting money into bonds (or even in addition to), there is a certain shiny yellow metal that may be just as good a store of value (granted, inedible) that despite a lack of cash flows (and who needs cash flow in a [...]
We are in a world of hurt. No rain, no grass, no hay to buy. Even if we get some rain this fall, hay stocks will be so low that overwintering will be another test.
In spite of huge selloffs, feeder cattle prices have held up fairly well. Which makes one wonder what prices will be next year and for some time after. Not only feeder cattle, but [...]
Summary: Technology, Agency, & Extortion
Here I am watching a lynchpin MSA collapse from the other side of its lynchpin suburb collapse, in a bedroom farming community full of Hummers, Christian schools, and sparkling government buildings, across the border from an similar echo collapse, with massive stimulus entering the black hole, from empire cannibalism, which has now reached Spain and Italy, while GE is taxing the [...]
by John Galtier
To be clear from the start, the finance world is one of the most counterintuitive forums for intellectual discussion that has ever existed. The arena is touted as attracting the best and the brightest, while time after time, thought revolutions and advancements are borrowed from other fields, or worse, financial academia. “Rainmakers” are loath to admit that they do such things, but they [...]
I have been watching the volatility of the silver market and I think that I see evidence not only of manipulation, but manipulation by machine algorithms.
Watch the precipitous plunges. It is as though machines are all given the “sell” signal at the same time.
Lets face the truth. I am as paranoid as they come, but the story I am telling myself is that Morg. Stan. is (Naked?)short [...]
May 2008:Â “Buy, Buy Buy!!!Â Subprime is contained, no impact on the economy whatsoever!!”
September 2008:Â “Sell!!!Â There are cracks in the system, GDP is going to implode!!!”
April 2009:Â “Buy, the Fed is going to keep buying more CDO Squared/Cubes!!”
May 2010:Â “The Fed is stopping QE!!Â The Flash Crash means the system is going to implode!!Â Sell!”
September 2010:Â “The Fed is cranking up QE2!Â They were only kidding about withdrawing [...]