Comments for Prospectivevalue.com

Comment on Bank of America is Going to Crush Earnings. by Bryce

Bryce — Mon, 20 Apr 2009 13:47:30 +0000

Good call. Spot on.

Comment on Taxes ARE Going Higher… So I am NOT Going to Pay Them! by Bryce

Bryce — Sat, 18 Apr 2009 00:14:09 +0000

I completely agree. It is kind of sad you cant touch the money without penalties for some 40 years but such is life. Perhaps then you will be interested in family trips with the grandkids instead of cocktails Happy B-day.

Comment on Taxes ARE Going Higher… So I am NOT Going to Pay Them! by flowell

flowell — Fri, 17 Apr 2009 21:37:02 +0000

Just a point of clarification, any compnay match to your 401K has to be in a traditional 401K account. The company match will start a new 401K under the traditional rules if you choose to put all of your contributions in a Roth structured account.

Comment on What if GM Goes Bankrupt this Weekend? by Bryce

Bryce — Thu, 09 Apr 2009 17:16:06 +0000

I largely agree with snippets of your friend’s opinion piece however the action taken by our President to back warranties by the full faith and credit of the US should not be under estimated. (I know this is a development since the article was written) I doubt we will see GM disappear after filing for bankruptcy as the piece suggests and actually feel that it will emerge competitive in the US auto landscape.

The industry will see increased demand in the years to come and is incredibly capital intensive. While their image is damaged at home, GM has done quite well overseas. If GM can rid itself of it’s debt burden and past obligations through bankruptcy it just might represent a decent long-term investment.

Comment on What if GM Goes Bankrupt this Weekend? by Matthew Lu

Matthew Lu — Thu, 09 Apr 2009 15:40:49 +0000

Written by one of my friend’s brother in conjunction with Spencer Abraham, a former US minister of energy, his New York Times opinion/editorial argues that a GM bankruptcy would be disastrous:

http://www.nytimes.com/2008/11/24/opinion/24abraham.html

Comment on What if GM Goes Bankrupt this Weekend? by Bryce

Bryce — Thu, 09 Apr 2009 13:53:39 +0000

I doubt GM’s bankruptcy, though needed, will be ‘quick and surgical’ as our President has suggested. From what I have read the attorney’s fees are expected to exceed $200 million and the process should take 9+ months. I have also read that bankruptcy judges care very little if at all about labor contracts and place all emphasis on the debtors. This implies that the pension and healthcare benefits will be significantly reduced. I feel terrible for all of the retirees who expected/have been receiving a certain level of income that will most likely not come to continue in the future.

With that said, I was not under the impression that GM’s union contracts had much to do with Ford’s. While I agree that perhaps the union would/should be willing to accept concessions such that Ford prospers, I would not be surprised if they wanted even more assurances. As for Ford, some of their cars have MSFT software. What about possible viruses? (I saw in a car show one year that a prototype MSFT car OS was ad supported…)

Also, I am concerned of the ripple effects of a GM bankruptcy. I know this was GM’s argument the whole time and I disagree that it should be avoided because of those effects but I do expect them to be substantial. GM has 2x the number of dealers that Toyota does and doesn’t sell many more cars. GM’s bankruptcy is going to cost a LOT of jobs but I have faith in the system and creative destruction.

I like Tesla. I think when GM goes bankrupt they should buy up some of GM’s production facilities and mass produce the S

Comment on Microsoft, A chance to Shine by Bryce

Bryce — Sat, 28 Mar 2009 20:42:45 +0000

I am long MSFT and like MSFT as well. While I do expect them to continue to loose market share to Apple, I think that there is pent up demand for a replacement to Windows XP and like you said, it has received stunning reviews. Based on various metrics I feel that MSFT should be $25.

With that said, the company lacks innovation and only maintains its dominance because everyone is stuck with their product. If they continue to waste cash by subsidizing projects and attempting to play catch up, they will loose their dominance at which point we shall all bear witness to their demise (ala Dell) as an equity.

Comment on Has Anything Changed? by Bryce

Bryce — Tue, 24 Mar 2009 04:22:08 +0000

Very well said Forrest. I like many of your points and agree with most of them. Your cost basis for Citi isn't below $1? I am disappointed! Of anyone I know, I would expect you to have bought then. That said, I read an interesting article on Bloomberg that aligns with a previous post on your behalf in support of a commercial real estate decline. Oddly enough, Citi is better positioned in this than nearly any other bank! Perhaps it is the first correct thing they have done. Defaulting Commercial Properties Hit Banks on Vacancy-Rate Rise

Comment on Ultra ETFs: Beware the Monicker of (-)2x the Return! by flowell

flowell — Tue, 24 Mar 2009 04:21:18 +0000

As an example, be careful with SRS. I was lucky enough to sell most of it Friday afternoon and the rest I sold in pre-market this morning at 64, it now trades at 49. This is nearing its price support so be prepared for a rebound or if it can’t hold this level there is not technical indicators to know how far it will fall.

Comment on The Rally is Real! by flowell

flowell — Tue, 24 Mar 2009 01:42:03 +0000

I think it is unfortunate that the old montra of buy and hold has taken a severe beating in the current market. But I am slowly coming to the opinion that actively managing your portfolio is perhaps not as evil as I once thought. I WAS with you, I have an more faith in capitalism and the American way life than anyone I know. But! GE was at one point dead money since 1991, same with C, the market as a whole was dead money since 1994, one cannoth ignore theses huge trends. The average annual return for the market if you bought at the high in 1929 to the low this year was an astounding 3.21% for the DOW. That is bad, really really bad.