Can Turtles Fly?

Here are some articles I found interesting. Not in any order... Disclosed Fairfax e-mails show short-seller attacks on company (The Globe & Mail): More details from the bizarre situation from a few years ago. It's amazing what some short-sellers will do. Daniel Loeb from Third Point doesn't come out looking good, that's for sure. (Recommended) Jacob Wolinsky interviews Roger Lowenstein (Jacob Wolinsky for GuruFocus): Newbies may not be familiar with Roger Lowenstein but he is one of the top (business) authors of the last few decades. He is most famous for writing a biography of Warren Buffett. (Recommended) The high-profit-margin risk (Vitaliy Katsenelson for GuruFocus): Many who are bearish, including me, are most concerned, not with earthquakes, wars, and the like, but, with the seemingly high profit margins of American companies. This article runs down the author's view of the risk. WikiLeaks cables - US diplomats' view of BYD (Reuters via The Star)...

Some of these articles are really old—in general, don't always assume I post current articles since I have a habit of reading old ones—but think some of you may find them interesting. (Highly Recommended) GuruFocus interviews Bruce Greewald (GuruFocus): Some people don't like Bruce Greenwald, professor of finance and asset management at Columbia University, but I'm a fan of him (although I don't really use his methodologies). (Recommended) Book Excerpt/Adaptation - The Price of Everything: Solving the Mystery of Why We Pay What We Do (The New York Times): Adapted from a book by Eduardo Porter, this article provides a look at a modern problem, the spectacular rise of incomes at the top (whether in sports, entertainment, or business). One theory cited appears to explain what may have happened: " Nearly 30 years ago, Sherwin Rosen, an economist from the University of Chicago, proposed an elegant theory to explain the general pattern. In an article entitled “The E...

Hope everyone had a good year and is looking forward to the holidays. Investingwise, it has been a very poor year for me, but, careerwise and in other matters, the year started off rough but it has been good so far. Google introduces Books Ngram viewer (AtlanticWire): Amazing free tool called Books Ngram Viewer that lets users view trends in words on roughly 10% of books printed, in six languages, between 1500 and 2008 (approximately 5.2 million books). Biggest drug recalls in US history (24/7 Wall St): Some of it is not pretty, especially if you consider how humans were harmed. The iPhone increases US trade deficit (The Globe & Mail): A good article that refers to the study, " How the iPhone Widens the United States Trade Deficit with the People’s Republic of China,"  that suggests that Apple's iPhone, although owned, designed and sold by an American company, actually increases the US trade deficit. I was going to write about this in a standalone po...

Too many things to read... (Recommended) Benjamin Graham on intelligent vs unintelligent speculation (CanadianValue for GuruFocus): I'm not a classic value investor and think Graham is wayyy too conservative, but it's still good to think about risk. One distressed company to watch: Deans Foods (Bloomberg): Contrarians and distressed value investors may want to check out Dean Foods (DF), the largest dairy in America. Dean Foods is off around 66% in the last 3 years and is apparently struggling due to, what else, too much debt. I don't like companies like this but I notice many value investors like these old-school companies. One of the big risks with situations like this is a take-under. There is nothing to stop someone from coming in and buying this company at a really low price, especially if the stock keeps sliding for a while. WikiLeaks reveals Pfizer pressured Nigerian officials to drop suit by trying to uncover corruption (New York Times): According to one of th...

Here are some articles I found interesting. I have a bunch related to politics and this may anger some of you so if you don't want to hear it, skip over the WikiLeaks stuff near the bottom. As usual, not in any particular order... Some Canadians snapping up US residential real estate (MoneyVille): Real estate bulls such as John Paulson have said that it's a great time to buy American real estate but I am not so sure. Although not as risky as buying near a peak, I can see someone not making any money for years. Having said that, the funds mentioned in this article are buying prime Florida real estate—I assume they are prime?—so they should be ok in the long run. After all, they don't build those sandy white beaches in America. A bubble in private Internet companies? (Dealbook): The privately rumoured valuations of Internet companies like Twitter, Groupon, Zygna, and others, often reach billions of dollars. Some of these companies are revolutionary and likely will dominat...

I hate losing articles and such was the case with one I was typing up earlier this week grr :( One area I have been researching lately is the historical behaviour of large-cap and mega-cap stocks. Some of you may have noticed it but I find it very bizarre that the market is pricing large-cap and mega-cap American stocks at relatively low valuations. In fact, depending on the measure you use, the market is pricing them lower than small-caps and mid-caps even. As an example, consider the P/E ratios of the following (I'm not recommending any; just picked some random big ones): Microsoft has a forward P/E of 9.7 and a trailing P/E 12.3. Intel (cyclical) has a forward P/E of 9.7 and a trailing P/E of 12.3. IBM has a forward P/E of 10.4 and trailing P/E of 12.1. ExxonMobil (cyclical) has a forward P/E of 8.8 and trailing of 13.4. JP Morgan (vulernable to dervatives implosion) has a forward P/E of 8.8 and trailing of 11.9. Pfizer (potential value trap) has a forward P/E of 6.7 an...