Tag Archive: Investing


Alibaba Set To Price IPO Shares Amid Investor Frenzy

 

 

 

 

 

 

” Chinese e-commerce giant Alibaba Group Holding Ltd. is set to sell some $22 billion of shares on Thursday, capping a two-week road show that drew frenzied interest from investors worldwide and may be the world’s largest ever initial public offering.

  The shares are expected to be priced after the markets close at 4 p.m. Thursday and start trading on the New York Stock Exchange on Friday under the ticker “BABA.”

  Investors, keen to buy into China’s rapid growth and evolving Internet sector, have been clamoring to get shares since top executives at Alibaba, including co-founder and executive chairman Jack Ma, kicked off the road show last week.

  Alibaba, which handles more transactions than Amazon.com Inc. and eBay Inc. combined, boosted the IPO price range to between $66 and $68 a share due to the strong demand.

  At the top end of that range, the IPO would raise almost $22 billion, but if underwriters exercise an option to sell more shares, Alibaba’s market debut will top Agricultural Bank of China Ltd.’s record $22.1 billion listing in 2010.”

 

 

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Part 1 From Victor Wendl At Seeking Alpha

 

 

 

 

 

” Ayn Rand wrote an influential book, Atlas Shrugged, in the ’50s that seems to resurface in popularity with each new wave of government intrusion on the lives of our overregulated, overtaxed citizens. The book describes a world that was on a slow but steady path toward ever more central planning by meddling bureaucrats interfering with the entrepreneurial class who relied on one another for their production of output. As the pages of the book are turned, this “road to serfdom” (a phrase I borrow from Friedrich Hayek) reaches a peak with the last of a small subset of productive entrepreneurs dropping out of their respective professions and sealing themselves off in a secret location created by John Galt. Their isolation from government interference in Galt’s secret hideaway was designed to allow this subset of creative, hard-working individuals to pursue their dreams and live in a rational way, trading value for value with one another. The vision of Galt in his hidden refuge is consistent with the Ayn Rand objectivist philosophy that she advocated her entire life as an immigrant to America from the Soviet Union.

  Rand never wrote a sequel to Atlas Shrugged, but I wonder where she would pick up after the first novel ends. We’re left with John Galt and his band of entrepreneurial cohorts waiting to eventually reenter the failed utopia created by central planners. Taking a peek out of his libertarian lair, I wonder what Galt would think of America today. Some of the current dismal economic statistics seem consistent with the world Ayn Rand created in her fictional novel. The latest Census Bureau figures show a larger percentage of people receive some form of means-tested public assistance than work full-time. Would this be a rock-bottom entry point where Galt and his band of entrepreneurial cohorts can once again return to the world and begin rebuilding America based on principles of limited government and free markets? Not quite yet. One last worn-out shoe has yet to drop: the U.S. stock market.

  Unlike the beaten-down real economy, activity on Wall Street continues to flourish. Large banks and their institutional clients have benefited from the artificial stimulation promulgated by the Federal Reserve. By keeping interest rates near zero percent for the last five years, middle-income families receive next to nothing off their life savings, while institutional clients can borrow money at bargain rates from large banks. In a classic example of crony capitalism, banks have rewarded their institutional clients with cheap loans, enabling them to use borrowed money and speculate on stocks, driving valuations to levels not seen since before the bank bailout in 2008. The governor of the Bank of England recently commented that “banks operated in a privileged heads-I-win-tails-you-lose bubble.[i] I believe Galt would be disgusted at this unintended consequence of government intervention that is driving a wedge between the elite on Wall Street and the average American struggling to make ends meet on a beleaguered Main Street. If Galt were a stock investor, would he trade in some of his gold for fiat currency, cozying up to this collection of institutions buying large-cap stocks on margin? At these nosebleed valuation levels, Galt would probably “flip the bird” at Mr. Market before sliding back into his hidden sanctuary until greener pastures emerged in the equity investment arena. Galt strikes me as the kind of independent investor that would keep his libertarian powder dry until the current statist experiment ran its complete course, waiting patiently to scoop up the right kind of stocks at a great price. Assuming the skeleton infrastructure of an organized stock exchange still remained on the day of Galt’s return to the investment arena, what stocks would he select from the rubble left on the corner of Broad and Wall? A review of the character’s profile might give us a few clues. Let’s go through a few stock categories I believe John Galt would avoid. Buying large company stocks would probably be out of the question for Galt. In the recent past, these stocks were the economic football the large institutions speculated on with borrowed money. As already mentioned, savers deposited hard-earned money in their bank accounts and received close to a zero percent interest rate, while money was loaned out in a speculative frenzy to the bank’s institutional buddies. Adding insult to injury, not only do retirees earn about the same interest rate as preppers get off of canned goods stored in their bomb shelters, their principal is being debased from continuous quantitative easing by the Federal Reserve. The stench coming off this large-cap football used by highly leveraged institutions in stock speculation would be too much for Galt to muster a bid order. “

 

 

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MONEY NEWS

 

” Most people know Sean Hyman from his regular appearances on Fox Business, CNBC, and Bloomberg Television, but what they don’t know is that Sean is a former pastor, and that his secret to investing is woven within the Bible.

Perhaps that can explain why, despite his uncanny ability to predict precise moves in the stock market, Sean is often laughed at for his unique stance on investing.

For example . . . a few months ago Sean appeared on Bloomberg Television. At that time, Best Buy (BBY) was dropping to all-time lows of $16 a share. Sean predicted the stock could go down to $11 a share, and would then quickly rebound to $25 per share, and after that would rally to $40 per share over the next year.”

 

 

 

 

 

 

 

What The Bond Market Sell-Off Looks Like On A 222-Year Chart

 

global financial data bond yields versus stocks

” The big story in markets over the past few weeks has been the sell-off in the Treasury bond market and the accompanying rise in bond yields to their highest levels in over a year.

Goldman strategists are out with a call declaring the sell-off “for real” this time after a number of false starts.” 

 

5 Unknown Dividend-Paying ETFs Yielding 12% Or More

 

 

 

” The stock market volatility of late puts into question how much longer the current uptrend can last. Dividend-paying ETFs can cushion the blow of day-to-day gyrations and offer investors something for sitting on their hands. Here’s a look at five of the fattest-dividend paying ETFs on the market and what’s driving there performance.

With the exception of iShares FTSE NAREIT Mortgage REIT ETF (REM), all of these are very thinly traded, so they’ll likely have wider bid-ask spreads than more liquid ETFs and it may take longer for your brokerage to fill an order.

 

2. iShares MSCI Hong Kong Small Cap (EWHS).

312-month yield: 12.75%.

One-year return: 23.15%.

IBD Relative Strength and Accumulation-Distribution Ratings: 40, B+.

EWHS gapped down $3.79, or 12.75%, on Dec. 18 when it paid out $3.70 a share in income.

EWHS is trading below the 50-day average but above the 200-day line, which means it’s in a weak uptrend. Nearly half of assets are devoted to consumer discretionary companies, a fifth is in financials and one-seventh is in technology. EWHS trades at a slight discount to emerging markets with a price-earnings ratio of 11.89 and price-to-book of 1.03. Emerging markets have a P-E of 12.3 and P-B of 1.58. “

 ‘Someone Yelled Fire’

 

 

  ” Forget the “fiscal cliff.” The real panic on Wall Street is over Apple’s stock.

Nearly every mutual and hedge fund has piled into Apple [AAPL  525.62    -11.26  (-2.1%)   ]during its spectacular rise over the past few years. Now, these same funds are scrambling for the exits as the stock goes through an equally spectacular decline.

Apple plunged to a six-month low Thursday as funds rushed to take profits on the stock before it’s too late. Shares are now off 25 percent since late September—shortly after the iPhone 5 launch and a month before the iPad Mini introduction. “

NY Post :

“Back in 2008, hedge fund honchos flocked to support Barack Obama in his presidential bid, and Scaramucci was one of them. But during Obama’s term, Scaramucci and others in his circle have turned on Obama something fierce.

Two-thirds of hedge fund money went to Democrats in 2008; this year about the same percentage is going to Republicans. “

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