Daily Dose of Optimism

DDO Roundup - Gecko 2, Global Warming, Speeding, Detroit and Satellites

* The NY Times reports: a sequel to one of my favorite films, Wall Street, is in the works:

Or so those at 20th Century Fox hope. Even as their boss, Rupert Murdoch, pursued an uninvited takeover bid for Dow Jones this week, Fox movie executives quietly sealed a deal to revive Gordon Gekko, the suspender-loving financial prowler who made grabbing seem good in Oliver Stone’s 1987 film, “Wall Street.” [...]

Mr. Pressman declined to say more about the plot. But the title, he said, will be “Money Never Sleeps,” after one of Gekko’s guiding principles in the first film, written by Stanley Weiser and Mr. Stone.

The last Wall Street was released in December 1987, about two months after one of the worst periods in American investing history. I'll irresponsibly wager that equity markets continue to rally until this movie is ready for launch...

* An oldie but a goodie... a video that dramatizes changes in real estate prices over the last 150 years ... as a roller coaster ride. Video runs about four minutes, and I'd say it makes its point quite effectively.

* I watched an interesting documentary a few weeks back, The Great Global Warming Swindle. It's posted on Google Video. If you've watched Al Gore's Inconvenient Truth, you owe it to yourself to watch this response. Among other things: the movie debunks CO2 as a key factor in warming; links warming on earth with changes in solar radiation; and interviews the founder of Greenpeace on how the environmental movement's increasing radicalism was a by-product of Western Marxists having nothing to do after the fall of communism. (So, when you sense that the environmental movement sounds strangely anti-capitalist, well, now you can understand why.)

A sample claim from the movie is that many times more CO2 is generated by the ocean, decaying plant matter, animals, and volcanoes than by all human activity combined. Special bonus point: if indeed the sun is warming the earth, it is nothing we haven't seen before, and life on earth could actually get much better than it is today if temperatures were higher. As a result of watching this video, I will probably not spend another minute thinking about Global Warming, ever. Period. Go out and enjoy a campfire, drive your car, use some aerosol deodorant. Enjoy life. Save your worries for something that matters, and if you feel guilty about your godless, consumerist lifestyle, go to church, and stop taking it out on the rest of us!

* I wonder how John Corzine would feel about speeding ticket fines based on income, as they are in Finland:

Anssi Vanjoki [EVP at Nokia], 44, was ordered to pay a fine of 116,000 euros ($103,600) after being caught breaking the speed limit on his Harley Davidson motorbike in the capital, Helsinki, in October last year.

* Did you know that parts of Detroit are so overgrown and depopulated, that it is actually being reclaimed by nature? It's an amazing portrait of demographic decline. Here's the scoop from DetroitBlog:

• Wild Kingdom - http://www.detroitblog.org/?p=287
• Wrong Side of The Tracks - http://www.detroitblog.org/?p=405

* For a cool interactive Java-applet of every satellite orbiting the earth (courtesy of NASA), see this link. You can rotate the earth and see the names and orbit of each satellite out there. - Ed

Investment Roundup: Seykota, AMD-MU-LKX, Steinhardt, CBH, OXPS

* "Everyone ultimately gets what they want from the market. [...] The best measure of your intentions is the result you get." - Ed Seykota (How's that for a zen interpretation of your struggles? - Ed)

* Salacious Rumor: AMD, MU, LXK to go private? Based on a perusal of AMD's cash flows, I can't imagine it, but it's possible a private equity firm has aggressively hacked up their forecast. EE Times has the news:

Rumors are running rampant that AMD, Micron and Lexmark are separately mulling over plans to go the private-equity route, according to various reports. There were other rumors last week [...] but private equity dominated the rumor mills. According to the Idaho Statesman, Micron Technology Inc. is rumored to be a buy-out candidate amid wild activity with its stock late last week. CNBC late Friday (May 25) reported that private-equity giant Blackstone Capital Partners is interested in Micron (Boise, Ida.).

Last week, rumor had it that ''Lexmark, Micron and AMD were all on the verge of going private,'' according to a report from SG Cowen Securities. Micron lost money in its recent quarter amid a downturn in the DRAM and NAND flash markets. Advanced Micro Devices Inc. (AMD) is struggling and is seeing red ink. Freescale, NXP and others went the private-equity route last year.

* Aspiring professional investors take note:

Steinhardt doesn't think superior portfolio management can be taught. "The greatest teacher is experience," he says, noting that his own stock-trading days began at 13 when his father gave him more than $5,000 in shares of two companies. "By the time I graduated from Wharton at the age of 19, I had more trading experience than most people have at the age of 30 or 35," he says. "I made more mistakes by the age of 19 than most people make 10 or 20 years later into their lives."

It's important for a hedge-fund manager "to really feel miserable" for their mistakes and to be galvanized by "the sense that their own personal security is at risk. I felt that more than once," he adds, implying that these factors are missing in today's more comfortable and well-compensated hedge-fund world.

Ed's interpretation: you're mostly on your own as far as learning about investing, there is no substitute for real trading experience, and when you do figure things out, make sure you align your interests with any outside investors.

* I've started looking at unusual call activity as a means of humoring myself while I drink my coffee in the morning. Recently, two interesting names came to my screen, both with 15-20x the normal volume of calls: Commerce Bancorp (CBH) and OptionsXpress (OXPS). Commerce is rumored to have good news pending on an OCC investigation into related party transactions by executives, and OptionsXpress is rumored to be an acquisition target...by E*Trade.

Reuters: "Given the recent consolidation among online brokers, the rumor might have some merit," said Frederic Ruffy, analyst at options education firm Optionetics in Redwood City, California. OptionsXpress declined to comment. E*Trade Financial was not immediately available for comment.

Both of these are plausible outcomes, and I think that the news would lead to happy trading for both...so I'll be watching. Emails and comments welcome. - Ed

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