***Official*** 2011 Stock Market Thread

[eLiu]

What you describe in Intel is not unique to Intel. It is unique to the whole sector. It is a rapidly changing industry. Picking winners is hard because no one can see 10 years out, let alone 2. Whoever in 2000 said APPL would be a big player in home electronics 10 years later was laughed at. now, Apple has to fight every 6 months for market dominance. It's a matter of when ... in terms of when they loose the fight. And it will not be 2020 in all likelihood.

Railroads (for example) may not be as glamorous but at the same time, you know where railroads will be in 20 years.

The easy path is to ignore Intel and the entire sector and focus on things like grocers (Safeway) and railroads and even home building companies (USG).

USG takes dirt (Gypsum) and forms it into 4x8 sheets. It does not get much simpler than that. And it is sold at Home Depot for $6/sheet. It's a matter of when sales recover. I just did a mud room using 10 sheets or so so I am contributing! Anyone can understand USG. Anyone can understand Coke-a-Cola. it's buying at the right price that matters.

Regarding Coke, read bullet #2:
http://www.gurufocus.com/news.php?id=120119

As the world's largest chip manufacturer by far, I think what I said is particularly important to Intel. That statement was more responding to whoever said Intel is a safe company. My point was while that may be true for the next year or two, it might not be for very long. People who want to invest in Intel need to be aware of who its competitors (sounds like ARM makers/users) are and where the challenges lie in upcoming years.

I agree that it's hard to predict when a company will release a new revolutionary product. But mobile devices and PCs are likely here to stay. It's not like we're going to wake up in 20 years and no one needs computers or phones anymore... well that would be pretty neat if so, but I wouldn't bet on it. But if in 10 years, x86 is relegated to some kind of niche market and everyone is using ARM-based devices, that could be very bad for a company who's main expertise is x86. For now it seems like Intel is sticking to their guns and it remains to be seen whether x86 will become competitive with ARM or not. From an architectural standpoint it wouldn't surprise me if that doesn't happen due to the amount of inefficiency inherent in x86... but I am certainly watching these developments eagerly! I've debating btwn Intel & Nvidia for a while now... still don't know what to do. Maybe the answer is 'nothing' as you say.

 

[IHateMyJob2004]

eLiu,

Point well made.

As for do nothing, it is one of the hardest tings to do as an investor. I always try to remember that the decision to do nothing is still a decision.

 

[IHateMyJob2004]

Bought more LEE this morning for $2.50. Increased my position in that by 80% or so where my cost basis was soemwhere around $3.10. So, I bought on a 20% dip. I'll buy more at $2 if it happens.

 

[Imp]

Shit myself earlier when I saw that the DOW was down 3% at open. Then reality set in: I'm already down 5-10% because geniuses panicked over the last few weeks due to the great "oil crisis" (hello again $98 crude).

The funny thing is I did liquidate all my Canadian holdings, because the TSX was pretty well insulated from the oil panic. Lot more down there, and barring a few companies, there is little volatility on the TSX.

 

[SSSnail]

Bears seem to be too strong the last few months, I should have gotten out yesterday when I was above water. Just about every excuse is good enough to bring things down. I knew this day would come, but didn't expect it to come so soon.

 

[KB]

Seeing the DOW down that much is tough to see but its actually a good thing. People have been so worked up about a market correction they were willing to bet anything was going to be it. Those who were holding out for a market correction may see this as a big enough correction and get back into the market. For those getting dividends your reinvested dividends are now buying more shares.
Lately being in the market has been like having a bipolar girlfriend.

 

[Imp]

Seeing the DOW down that much is tough to see but its actually a good thing. People have been so worked up about a market correction they were willing to bet anything was going to be it. Those who were holding out for a market correction may see this as a big enough correction and get back into the market. For those getting dividends your reinvested dividends are now buying more shares.
Lately being in the market has been like having a bipolar girlfriend.

It is good to see the DOW down. The "market" hasn't been corrected, or it isn't "down" until the DOW goes down. Fortunately, I learned long ago that the DOW only consists of 20 companies. I was already 5% down before the DOW even dropped past 12200 from 12400.

 

[MotF Bane]

So what companies will do well in the reconstruction of Japan?

CAT should get a boost, if indirectly, Jacobs Engineering?

*sigh*

I considered CAT last summer at something like 65, decided against it. Excuse me while I punt myself across the room.

 

[Imp]

So what companies will do well in the reconstruction of Japan?

Ford is down about 10% since 3 weeks ago, it's one of the few stocks actually trending up today. Helps when 3 of your major competitors are gimped; all 3 should have plants in North America though, so they shouldn't be too screwed.

 

[richardycc]

bought more CIGX at $2.8...$10 is coming!

 

[gophins72]

Fortunately, I learned long ago that the DOW only consists of 20 companies.

it is 30 now:

http://www.cnbc.com/id/26272770

 

[lothar]

So what companies will do well in the reconstruction of Japan?

CAT should get a boost, if indirectly, Jacobs Engineering?

Popsco and Komatsu.

 

[lothar]

At least in the short term, you aren't concerned about the FDA 'consent decree'? I'd be curious to hear your thoughts on that. I thinking of getting into JNJ, but I am unsure of the seriousness of the FDA having to step in and oversee JNJ's plants. When this has happened in the past (to other companies), it seems like the seriousness has varied widely... some get their shit together quickly & it's not a big deal; others have severe problems.

Also for Intel, I think a bet for Intel now is a bet against Nvidia. Nvidia wants to step into the server market currently dominated by x86 processors with "Project Denver." They've said this at several conferences, and it's obvious from their manufacturing. In nvidia' settlement with intel in january, nvidia pulled out of making chipsets for intel procs and opened the door to a bunch of cpu technologies they could use to compete with x86. GPGPU also stands poised to take a stab out of Intel/AMD in high-end computing. And at the moment, Intel has shit to show in the small devices/mobile market. What the next gen Atom can do remains to be seen, but there are many ppl out there that think shrinking x86 & making it more efficient is not the path to victory. Lots of ppl are getting behind ARM processors; microsoft for example is putting out windows that runs on ARMs. That said, it's not like intel is retarded and will just ignore the mobile market; they are moving on it. Additionally, the future of mobile devices remains to be seen but many believe it's going to be the future of computing.

I've heard some people in the field say Intel might go the way of DEC or SGI from back in the 90s. That is, big company with a dominant product getting out-maneuvered by smaller guys with new ideas. I don't really agree with that sentiment but it's something to be aware of.

The FDA decree on JNJ is nothing but a slap on the wrist as far as I'm concerned.

Regarding Intel and Nvidia:
Project "Denver" is mostly speculation. We haven't seen the actual products. So far, it's just an idea or engineering diagram.
GPGPU??? A lot of things I've read so far says CUDA has been a failure in that regard and is not being well adopted.

The people spending $1000+ on Xoom/iPad tabs plus data plans are ridiculous. AMD Brazos/Bobcat would beat those tablets in performance. You can also get an 11" i3 laptop that would crush those tablets in performance and flexibility. Sandy bridge should hit the 11" form factor by the end of the year, although right now it's only widely available in 15" and up.

I don't see Microsoft putting out an ARM OS as a blow to Intel. They are simply getting a second source of revenue without impacting their first source in any way, shape, or form. A blow would mean they are sacrificing the 1st to go to a second source. Example of a blow: Sprint changing from WiMax to LTE. Microsoft's decision to develop ARM OS is not.

Also keep this in mind:
1.)Intel has the freedom to develop an ARM processor if it wants.
2.)Nvidia does not have the freedom to make an x86 processor or an ARM processor that emulates one.

A lot of assumptions seem to be that Intel would just sit there and do nothing and that Nvidia's Project "Denver" would be a success.
They are just that, speculation.

 

[Imp]

it is 30 now:

http://www.cnbc.com/id/26272770

Woops.

Ford up 2.50% today. Boo ya. Loss recovery!

 

[lothar]

As the world's largest chip manufacturer by far, I think what I said is particularly important to Intel. That statement was more responding to whoever said Intel is a safe company. My point was while that may be true for the next year or two, it might not be for very long. People who want to invest in Intel need to be aware of who its competitors (sounds like ARM makers/users) are and where the challenges lie in upcoming years.

I agree that it's hard to predict when a company will release a new revolutionary product. But mobile devices and PCs are likely here to stay. It's not like we're going to wake up in 20 years and no one needs computers or phones anymore... well that would be pretty neat if so, but I wouldn't bet on it. But if in 10 years, x86 is relegated to some kind of niche market and everyone is using ARM-based devices, that could be very bad for a company who's main expertise is x86. For now it seems like Intel is sticking to their guns and it remains to be seen whether x86 will become competitive with ARM or not. From an architectural standpoint it wouldn't surprise me if that doesn't happen due to the amount of inefficiency inherent in x86... but I am certainly watching these developments eagerly! I've debating btwn Intel & Nvidia for a while now... still don't know what to do. Maybe the answer is 'nothing' as you say.

Intel is a highly capital intensive business in a rapidly evolving industry.
Does that automatically mean one should go rushing into buying nVidia or ARM stock since what I said could be a blow for Intel? No way.

What is stopping Intel and AMD from jumping into the ARM bandwagon? Absolutely nothing.

Rather than trying to pick a winner between Intel and nVidia, why not skip both and move on?
That's what I would do. I'm pretty sure that's what IHateMyJob2004 would do as well.

 

[IHateMyJob2004]

Lothar,

Actually I said the same thing. Thousands of investments out there. There is no real reason to try and force yourself into and Intel or AMD. To many other easier to understand busiensses out there.

 

[richardycc]

sold a little bit of CIGX to lock in some profits...I am a firm believer of "You Can't Go Broke by Taking Profits."

 

[iGas]

sold a little bit of CIGX to lock in some profits...I am a firm believer of "You Can't Go Broke by Taking Profits.";/b'

Totally agree.

I picked up GCE on the TSX for $9.12 on Wed, and now it is $9.68 (missed my chance at picking it up in the $8.50~$8.70 range on Tues, because I thought that the Japanese fiasco would take the market down till the end of this week.

Still I can't complaint at the 10% gain in 2 days.

UUU was down as low as $3.40~$3.45 range, and now it is back up to $3.93. It closed at $5.96 last Friday.

 

[TheNinja]

So if I own Citi should I sell due to reverse split? I mean, I know it's probably good long term to reduce the outstanding shares but still, I don't want 1/10th the number I have now.

 

[routan]

So if I own Citi should I sell due to reverse split? I mean, I know it's probably good long term to reduce the outstanding shares but still, I don't want 1/10th the number I have now.

what difference does it make? C right now at $4.5 will be C $45 after the reverse split. Your net holdings remain intact... you're not losing any value.

 

[Imp]

what difference does it make? C right now at $4.5 will be C $45 after the reverse split. Your net holdings remain intact... you're not losing any value.

Apparently splits cost money, and some investors think it's a move made by companies in trouble. I call bullshit on the latter. It's been making money and I can't see it up and dying. Still, there's obviously risk, and I'd still probably go with BAC over C. I currently have a small position in C.

 

[KB]

The reverse split was good for AIG and with the addition of a dividend, albeit extremely small, C may go up a bit more. If this is the start of increasing dividend payouts it may be a very good thing; however only earnings will tell.

 

[Regs]

what difference does it make? C right now at $4.5 will be C $45 after the reverse split. Your net holdings remain intact... you're not losing any value.

It's more about the reason for the R/s. Usually an R/s is a precursor for more dilution and that scares enough investors down a good 20% in value. If the company is doing lousy , investors are not going to develop amnesia - gravity will continue to pull the stock downward.

 

[TheNinja]

It's more about the reason for the R/s. Usually an R/s is a precursor for more dilution and that scares enough investors down a good 20% in value. If the company is doing lousy , investors are not going to develop amnesia - gravity will continue to pull the stock downward.

That's what I'm thinking. Yes, I realize 100 shares at $5 is the same as 10 shares at $50. But it's not always the same in the eyes of some investors. Some funds won't touch a stock under a certain $. Some people won't buy stocks over a certain $ b/c it's too "expensive". Normally it appears easier to move from $5 to $10 that it does to move from $50 to $100.

I was in C thinking I'd take the slow ride up, but this has me a little nervous. I might just jump out with my earnings and call it good for now. I'm not interested in the 1 cent dividend.

edit: I am a self described and proven newbie in the stock game.

 

[IHateMyJob2004]

Apparently splits cost money, and some investors think it's a move made by companies in trouble. I call bullshit on the latter. It's been making money and I can't see it up and dying. Still, there's obviously risk, and I'd still probably go with BAC over C. I currently have a small position in C.

C is wasting money on a reverse stock. Just another reason to not invest in them.