07/26/2012: GARY ON NATIONALLY SYNDICATED INVESTORS EDGE RADIO BROADCAST

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http://archives.warpradio.com/btr/InvestorsEdge/072618.mp3

JUST LETTING YOU KNOW

Facebook (FB) reported in the aftermarket.

I didn’t say anything to you about this earning’s report because I didnt want to sway you…but you have known before the IPO what I thought of the over-the top valuation on this deal.

I was actually thinking that there was no way the investment bankers could be so dumb to bring something out at such a valuation on a company where business may have already peaked. I was thinking, maybe hoping, that maybe, just maybe, they were sandbagging and holding back numbers before going public and then produce big numbers after going public. In other words…do the Apple sandbag.

But no.

So one of the biggest IPOs in history continues to be a disaster.This is a black mark on the investment bankers. But they don’t give a crap. They got their fees. They don’t care about you, the retail investor. You’re a nobody.

I told you on my radio show that they did this throughout 1999…and they are doing it now. Hopefully, you were listening because we begged you not to touch Groupon, Facebook, Zynga, Pandora, Renren and all this other stuff they foisted upon you at ridiculous valuations.

Facebook: Let’s Start From the Beginning

Facebook’s growth…monumental.

Went from nothing to $4 billion in revenues.

Went from a few people at Harvard signing on to a billion people.

But here’s the problem.

The investment bankers on Wall Street are #@%@&. Time and time again, they have shown that they do not care about you, the retail public. They never think longer-term about reputation. It’s always about “short-term and fees.”

In 1999 they brought a bunch of crap public. You’re to blame for 50% of that because you bought it! They recognized that they were in a bubble and  anything that they would foist upon you, you would take.

They were able to bring companies public that had no revenues. Did you hear that? No revenues! And they would give it a $500 million market cap.

And guess what? Because of your buying, it would double and triple…until, of course, the curtains came down and it all went to zero.

They brought companies public THAT DELIVERED FOOD…BASED ON THE FACT THAT YOU ORDERED THE FOOD OVER THE INTERNET! What a concept!

They knew better. They brought a company public that sold you stuff on the web and lost money on purpose in order to get you to the site so that THEY COULD SELL ADVERTISING!

I could go on and on.

Fast forward to the past year, when I started to notice they were at it again…bringing companies public at ridiculous over the top prices where only one thing’s going to happen: You are going to be buried.

They bring Pandora out.

A great idea?. Personalized streaming music…like there’s no other place you can get that from.

The company does not make money. They brought it out with something like a $3 billion market cap, with $100 million in revenues.

The stock hit a high of 26 and it’s now 9.

Do I have to do Renren?

It hit a high of 20 and it’s now 3.

How about Groupon?

Accounting irregularities before they go public. It’s well known that merchants get paid back much slower than most other companies, and they are going to have to change that and that will impact them.

They still bring it public at 20, giving it a $12 billion market cap.

They hype it. It’s 31 the first day…close at 26.

It’s now 6.

They bring Zynga out like they are curing cancer.

It’s games! It’s just games. They bring it out at 10, hyped it up to 16.

It’s now 3…down 70% from IPO!

And it’s still got a $2.3 billion market cap.

So then Facebook.

Over the past four quarters, Facebook’s earnings have decelerated. Their revenues have decelerated. It is well known that people are using it less.

It’s the tiring out effect. There’s so many times that somebody’s going to go on Facebook and say, “I went to Publix and bought some lettuce and it was very green.”

I’m not saying this thing’s not going to be big. Frankly, the potential is huge.

But what did the investment bankers do?

They bring the company public with $4 billion in revenues…with a $100 billion market cap…with decelerating numbers.

So what I simply said to you was “pick your poison.”

I told you, my radio audience as well as on my tv appearances on Fox Business that  if I had to value this company and I was the investment banker, I would have brought it out at $15 and with less shares. Which means on price, I would have brought it out at 10…or less.

No, they bring it out at 38 like it’s the 2nd Coming. You guys open it up at $42. Thankfully, you recognize it and it closed at 38.

It’s 26.85 today.

And now in the aftermarket it’s under 24.

Everybody who has invested in this has lost money. Most of the secondary people who got it before the IPO are losing money.

This must be a lesson to you about price as well as on these investment bankers who never ever learn from their mistakes. Without another massive bubble, this was a gimmee to be a disaster.

How do I know this? Because they did the same thing in 1999. Fast forward, they’re trying to do it again.

And just so happens that Facebook is a biggie.

And I’m sitting here looking at Zynga trading at 3, down from 10. Groupon at 6 1/2, down from 20.

I want to throw up. Not for me because I don’t own any, but for you guys who may have been jumping on these things.

And I use Facebook. I love Facebook. I go on it. I’ve got a page. I found some old friends from college and high school there. Nothing I am saying here has to do with the company. It has everything to do with price.

These investment bankers screwed you…and they knew it. They knew you were getting screwed at the price they were bringing it out at. They were in hopes another bubble was being created. There were some analysts that had the nerve to talk positively of the stock…which was absolutely nuts.

Anyway…back to my point. Pick your poison and do some homework. Just a short glance at the numbers would have kept you out. Facebook, even at these levels is still at about a $55 billion market cap. Just ask yourself whether right now you would pay $55 billion for this company. Again, this is not an indictment on Facebook the company. It is an indictment on whoever priced it at this number where no one had a chance. 

LISTEN TO GARY LIVE ON WEEKDAYS 6-7 PM ON A STATION NEAR YOU AND AT GARYK.COM

6-7 pm EST

Best of Investor’s Edge
Saturdays 1-2 am EST

Gary Kaltbaum owns Kaltbaum Capital Management, LLC (“KCM”), an investment adviser registered with the U.S. Securities and Exchange Commission. The opinions expressed herein are those of Mr. Kaltbaum and may not reflect those of KCM. The information offered in this publication is general information that does not take into account the individual circumstances, financial situation or individual needs of an investor. The information herein has been obtained from sources believed to be reliable, but we cannot assure its accuracy or completeness. Neither the information nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Any reference to past performance is not to be implied or construed as a guarantee of future results.

ONLY $1 TRILLION IN NEW TAXES? COME ON…YOU CAN DO BETTER THAN THAT!

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President Obama’s health care law raises taxes by $1 trillion, according to a new report from the Congressional Budget Office.

The individual mandate — which the CBO calls a “penalty tax,” in apparent deference to Chief Justice John Roberts — will produce $55 billion in “penalty payments by uninsured individuals,” the CBO told House Speaker John Boehner, R-Ohio, in a Tuesday letter. Of course, the framers of the law didn’t design the mandate as a tax, and so it produces less revenue than any other provision in the bill.

The “additional hospital insurance tax” is the largest tax increase in Obamacare, projected to bring in $318 billion in new revenues. According to the 2010 report from the Journal of Accountancy, this tax hits “high-income tax payers” — individuals making over $125,000 a year or households making over $250,000 a year.

Continued

SOURCE: http://washingtonexaminer.com/cbo-obamacare-levies-1-trillion-in-new-taxes/article/2503248?custom_click=rss

MEDIA BIAS AT WORK

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BRIAN WILLIAMS ACTUALLY ASKED THIS QUESTION OF ROMNEY! WATCH! GLAD ROMNEY STUCK IT RIGHT BACK IN HIS FACE!

 

Visit NBCNews.com for breaking news, world news, and news about the economy

PURE LOGIC…SIMPLE LOGIC!

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This is why I like Bill O’Reilly. Pure logic…simple logic! I don’t know this Congressman…but here’s a guy with absolutely no logic. Imagine not wanting to report someone buying 60,000 rounds of ammunition! READ THIS AND WATCH THE VIDEO:

During Tuesday night’s edition of “The O’Reilly Factor,” the Fox News host got into a heated exchange with Rep. Jason Chaffetz (R-Utah) over the concept of Congress passing legislation that the FBI would be notified whenever anyone purchases “heavy weapons.”

Bill O’Reilly said it makes sense for Congress “to pass a new law that requires the sale of all heavy weapons to be reported to the FBI. In this age of terrorism, that law is badly needed.”

Continued

SOURCE: http://newsbusters.org

SORRY…HAD TO POST THIS!

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 Just what the heck is going on here. And I do believe the Mayor is Jewish. How do such miserable, racist human beings get into a position of power? 

Ignoring Nation of Islam leader Louis Farrakhan’s history of anti-Semitic remarks, Mayor Rahm Emanuel on Wednesday welcomed the army of men dispatched to the streets by Farrakhan to stop the violence in Chicago neighborhoods.

Ald. Debra Silverstein (50th), an Orthodox Jew, has said it’s good that Farrakhan is “helping” in the fight against crime, “but it doesn’t eradicate the comments that he’s made about the Jewish community.”

Continued

SOURCE: http://www.suntimes.com

kaltbaum premarket

Last night, I added in one point that we have to be aware of Big Ben…meaning Bernanke and his printing of trillions. I should have said to be aware of big Mario because the ECB President Mario Draghi, on purpose…said this earlier this morning:
 
“sharing national sovereignty on EU level to come” and that the ECB is “ready to do whatever it takes to preserve the euro.”
 
This means they are going to come out with a couple trillion of eurobonds to back all the losses. Again, more debt to hopefully fix debt…but the markets love this…so we have at least a 1.5% gap to the upside this morning. By the way, durable goods came out and they were awful…but the real world does not matter right now…it is who can conjure up the most debt. Keep in mind, Draghi is just another failure. He was a governor at the Bank of Italy for 5 years prior and watched how Italy also fell into the abyss.
 
Bottom line, this market remains unplayable. I have been telling you I would love to go short but afraid to walk into big gaps. I have told you I would love to find some longs but too many breaking down.
 
WE ARE DOING THE RIGHT THING BY SITTING TIGHT. I CANT SAY THAT ANY LOUDER OR ANY CLEARER. THIS IS NOT THE RIGHT MARKET CONDITIONS WHERE SOMEONES WORDS CAN GAP THE MARKET UP OR DOWN!
 
The good news is that hopefully, eventually, leaders will show themselves and we can play. But we continue to deal with a bunch of massive failures that caused problems with too much leverage and debt and those same people are running the show…and answering the problem with more leverage and debt.
 
Gapping up:
 
EQIX,WFM,GNC,TSCO,AKAM,WDC…those are the bigger gaps. There are a few smaller ones to the upside…like V. EQIX and V are on the leader’s list and will watch. I am putting WFM back on but am wary as it got hit hard and now gaps up. As long as it stays above the 50 day, its ok.
 
Gapping down are ZNGA,SYNC,MKSI,LOGM,SRCL. There are other stocks gapped to the downside but smaller.
 
My #1 stock is MLNX right now. Be on watch. Big gap…major acceleration of numbers…not sure of market conditions.
 
My overall…is I do not trust anything from a day to day basis. Markets remain in a wedge even with today’s gap. We are into month-end b.s so this yapping came timely. We then get the other maniac in Bernanke next week. Good luck.

07/25/2012: GARY ON NATIONALLY SYNDICATED INVESTORS EDGE RADIO BROADCAST

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http://archives.warpradio.com/btr/InvestorsEdge/072518.mp3

JUST LETTING YOU KNOW

Apple

Apple closed down today 25.95. Let me be clear. That’s like a 60 stock dropping 2.59. So keep it in perspective.

Apple missed by a mile. Earnings and revenue decelerated huge. One would think the stock would be down 20% on this news. But no. It was down about 4 ½ percent on the news. Apple also lowered next quarter’s earnings markedly, which they usually do every quarter. What they are saying is that people are putting off buying because they are waiting for the iPhone 5 to come out.

Okay, I’ll buy that and I think that’s probably true. But we also were told how people jumped all over the iPhone 4S and I’m really wondering to myself (and this not bearish talk) at what point are the upgrades not going to be good enough to get everybody to just jump all over a new phone every time. Just a question to ponder.

Anyway, Apple affected some areas of the market today and on a technical basis, Apple broke back below the 50-day moving average and I would call it just in the middle of a range, going back to late-March.

And, of course, we’ll see what the following quarters come up with. Now rumor has it that the iPhone 5 will be announced and I guess it’ll be ready in October. The problem is that’s the 4th quarter, which gets reported in January. We’ll see how it plays out.

Frankly, I wouldn’t be a buyer of Apple now. If I owned it, I don’t really think there’s anything to do just yet. There is support at 565, 548 and 522.

Also of note, just letting you know…

There are a lot of chart breaks going on. I know yesterday that the crooks on Wall Street—the manipulators—floated another “Fed is coming to the rescue in the next week” and as soon as that was put on the Web at 3:30p ET yesterday, the market, which was down 200, only finished down 100.

The Fed meetings, I believe, are July 31st and August 1st and they will decide on something maniacal again. You know what I believe long-term about the moves that they are making. Short-term, anything is possible.

I’m just letting you know right now that the tape remains a mess. More and more areas are going “poof.” More and more stocks are breaking important levels of support. And will just urge you right now to go slow.

The market will eventually come out of this. We know not when or from what point. But we keep a close watch on it every day for accumulation vs. distribution in the major averages, sectors and individual stocks…and so far nothing doing.

We’ve had a lot of jello moving on the plate this earnings season. Got some stocks acting well off the earnings reports.  And lots of stocks acting well and really busting down off of earnings reports.

Very important that you pay attention to those earnings reports…or else. It is summertime. There is a lot of news. There is a lot of interference and market manipulation going on with these rumors and…yes, they are done on purpose.

And we’ll get through it.

Coal Stocks

The coal stocks continue to go into the abyss. The Stowe Coal Index (COAL) ETF has going from 51 to 22 in the past year. Patriot Coal (PCX) has filed for bankruptcy. Arch Coal (ACI) has gone from 28 to down to 5. Alpha Natural Resources (ANR) has gone down from 48 to 6.

Peabody Energy has gone from 60 down to 19.

Are you catching the drift here?

This illustrates why we talk sectors here and not just the market as a whole. There are lot of areas over the past year that have been absolutely bludgeoned. So it’s very important to pay attention to sectors and sub-sectors that we continuously follow and it’s important that you do also. 

LISTEN TO GARY LIVE ON WEEKDAYS 6-7 PM ON A STATION NEAR YOU AND AT GARYK.COM

6-7 pm EST

Best of Investor’s Edge
Saturdays 1-2 am EST

Gary Kaltbaum owns Kaltbaum Capital Management, LLC (“KCM”), an investment adviser registered with the U.S. Securities and Exchange Commission. The opinions expressed herein are those of Mr. Kaltbaum and may not reflect those of KCM. The information offered in this publication is general information that does not take into account the individual circumstances, financial situation or individual needs of an investor. The information herein has been obtained from sources believed to be reliable, but we cannot assure its accuracy or completeness. Neither the information nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Any reference to past performance is not to be implied or construed as a guarantee of future results.

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Just a few days left in this month…and may I say major indices now hanging on the ledge of a bearish wedge. That rhymes. I suspect we will get some end of month action and then have to deal with the fed next tues and wed…so will continue to go slow. I am more apt to short and for sure, not many longs left…but have to be aware of big ben.
 
IACI,LL,SWI had real strong reactions today so they will now be watched for any entries going forward. but certainly not now.
 
PCLN now showing CMG characteristics…which does not augur well as many leaders history. Will be back in the morning where maybe we can make a couple of plays but the issue is that I dont want to have to trade in the morning and trade out in the afternoon. This is just a crappy environment and a lot of our success is recognizing that,

THIS MAN HAS GRAPEFRUITS TO COME OUT AND SAY THIS!

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Hypocrite to top all hypocrites!

Who is Sandy Weill? He is none other than a retired Citigroup Chairman, a former NY Fed Director, and a “philanthropist.” He is also the man who lobbied for overturning of Glass Steagall in the last years of the 20th century, whose repeal permitted the merger of Travelers of Citibank, in the process creating Citigroup, the largest of the TBTF banks eventually bailed out by taxpayers. In his memoir Weill brags that he and Republican Senator Phil Gramm joked that it should have been called the Weill-Gramm-Leach-Bliley Act. Informally, some dubbed it “the Citigroup Authorization Act.” As The Nation explains, “Weill was instrumental in getting then-President Bill Clinton to sign off on the Republican-sponsored legislation that upended the sensible restraints on finance capital that had worked splendidly since the Great Depression.” 

Continued

SOURCE: http://www.zerohedge.com

 

 

 

 

 

 

 

 

MORE FED SHENANIGANS AND APPLE

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In plain sight, the @&#@& on Wall Street. conveniently floated a story about the Fed, once again, printing money to save the day. Of course, this B.S. was released late in the day…on a very bad day…which in turn goosed the market into yesterday’s close. They don’t even try to hide their manipulation any more. These people are very lucky I do not run the SEC. Keep in mind, the only goal is to keep markets from dropping.

Forgetting a second the “in plain sight” fraud (which has been occurring more often), markets remain in range with a bias to the downside. If the range is broken to the downside, expect some nasty…regardless of the Fed. I gave you the important support levels in my previous report and will update them as we move forward.

The market is sick here…and needs a big save. I am not so sure another round of money printing will do the trick. Keep in mind, the fed has been printing, is printing and will not stop printing. It is a farce to even report they are thinking about more of the same…as nothing has changed. And if the market wants to go lower, it will go lower anyhow. There will come a time when the market realizes all this nonsense by the Fed leads to nothing but a gigantic bond bubble…a bigger bubble than what we saw in 1999…but that’s for another day.

As far as the almighty Apple (AAPL), which missed numbers for the 2nd time in 39 quarters but interestingly enough, the 2nd time out of the past 4 quarters…just be careful. Great stocks do not die overnight and there is a case that numbers were down because of consumers waiting for the next iPhone. But think logically. There will come a day where unless the iPhone can be waved over a bald head to cure male pattern baldness, there will be a day where the upgrades become less and less important. As of now, Apple stock is doing nothing more than tucking its head into a 4 month trading range…and is just breaking the 50-day average. I do recognize that just about everyone who wants to own the stock, already does and the big money crowd remains loaded. So any more suspect numbers could turn this drop into something of more import. Will keep you apprised.

Gary Kaltbaum owns Kaltbaum Capital Management, LLC (“KCM”), an investment adviser registered with the U.S. Securities and Exchange Commission. The opinions expressed herein are those of Mr. Kaltbaum and may not reflect those of KCM. The information offered in this publication is general information that does not take into account the individual circumstances, financial situation or individual needs of an investor. The information herein has been obtained from sources believed to be reliable, but we cannot assure its accuracy or completeness. Neither the information nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Any reference to past performance is not to be implied or construed as a guarantee of future results.