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Monday, 22 January 2018

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JIM G.

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  • in reply to: Is there a lot of downside in US equities near term? #27037

    JIM G.
    Member

    Right, so money printing and inflating asset prices….so valuations are stretched….but fundamentally the banking sector has been recapitalized. I wouldn’t characterize the current lending standards by banks as bubble territory and fundamentally excessive…many are arguing for the banks to lower their lending standards……..maybe on the junk bond side…..although I do agree the actions of the Fed would mean the GOVT is fundamentally in a bubble.

    in reply to: Chaoda #27286

    JIM G.
    Member

    I sure hope any political connections Chairman Kwok had, which has shielded him so far, or maybe provided his company with some cover has he got his ducks in order, is still in tact with the recent change in leadership over there. I own the stock as well. Absolutely no reason to sell here. This has been a good reminder as to why some emerging markets/stocks trade at such low valuations, when considering the risk inherent in those markets.

    in reply to: Buffet gold conundrum #17958

    JIM G.
    Member

    All great points. Gold is a store of value. A currency. A proper comparison would have been against the dollar or Euro over an extended period of time. Gold is becoming its own asset class, one where people decide to put there money instead of holding cash.

    in reply to: Gold, Silver and Uranium mining stocks #27222

    JIM G.
    Member

    I currently own some producing jr mining stocks. I think the long term trends are still in place for the precious metal to rise. Something I have been thinking about is…..why dont these jr mininning stocks, which are producing and generating strong FCF, re-organize themselves as MLP’s? The business models are the exact same as down stream energy MLP’s, the stock prices would see an immediate boost in valuation as the market re-rates them, and it would open them up to a whole new investor base. We are already beginning to see the major players issue dividends. I am surprised activist investor groups have not been more “active” in the space. Seems there is meaningful upside to the investment by simply changing the corporate structure to an MLP and making them more shareholder friendly. Is this thought way off base? Any thoughts are appreciated. Thanks Jim Graf

    in reply to: THE US T-BOND BUBBLE #17913

    JIM G.
    Member

    I don’t think we need to worry about the Chinese dumping their T-Bills. As the old saying goes….if you owe the bank $100K that is your problem…if you owe the bank $100M that is the banks problem. We owe the Chinese so much $$ it is a real problem for them.

    in reply to: American Gridlock #27158

    JIM G.
    Member

    I have not seen the political will in our country to seriously deal with our debt problems. Therefore, our leaders will do everything to keep the system afloat as is w modest tweaks on the margin to fix the budget. As we are witnessing in Europe, it will take creditors to force the US to change our ways. I anticipate atleast 8-10 years of our economy “muddling” through. I think one positive wild card for our country could be natural resources. I know the political class want nothing to do with natural resources. But, the US is sitting in a postion to be a large exporter of natural gas as well as other resources. Imagine how that would help both our trade deficit and our employment picture. I think it would be ironic, that a country which prides itself on innovation and having a strong “creative class”, could actually be saved by something so basic as a natural resource. Again, this would take the politicians putting their ideology aside and seeing the economic benefits. My biggest fear is the long term negative affects of our large entitlement programs. Obviously the cost is a huge issue, but I am also very concerned about the “learned helplessness” this creates amongst our population. We could end up w a generation of people who are actually fearful of the opportunity to make their own fortunes. I am an optimist, so I do believe this country will prevail, sadly it will probably take a lot longer than it needs to.

    -Jim Graf

    in reply to: A permanent recalibration of P/E? #27146

    JIM G.
    Member

    Hi Shankar, I agree. I think all valuations will be negatively impacted from a no growth environment in the developed world. However, I think companies will continue to place greater emphasis on returning capital to shareholders and markets will reward management teams for doing so. Growth will definitely decline in the developed world and multiples will contract. I just think all the $$ sloshing around have to go somewhere and people will pay more for a company/management team committed to returning money to shareholders. Basically, I think markets will be less inclined to pay for growth and more inclined to pay for buybacks or dividends. But to your point, I do agree multiples on the whole will contract and all the more reason for us as investors to be so focused on VALUE!!

Viewing 7 posts - 1 through 7 (of 7 total)