Author Topic: Hmmm.. GE a good buy @ $32.50???  (Read 18485 times)

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Offline phg

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Re: Hmmm.. GE a good buy @ $32.50???
« Reply #30 on: June 13, 2008, 17:49:14 PM »
What you are probably seeing is institutional investors reducing their holdings.  Right now, about 59% of GE's stock is owned by institutional investors.  Short interest in GE is fairly low, however, about 0.6% so general sentiment would seem to be that this is near the bottom.  Was GE's dept downgraded recently?  I don't recall if GE lost their AAA rating after they reported the abysmal quarter.



Offline Silver Creek

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Re: Hmmm.. GE a good buy @ $32.50???
« Reply #31 on: June 14, 2008, 11:42:26 AM »
What you are probably seeing is institutional investors reducing their holdings.  Right now, about 59% of GE's stock is owned by institutional investors.  Short interest in GE is fairly low, however, about 0.6% so general sentiment would seem to be that this is near the bottom.  Was GE's dept downgraded recently?  I don't recall if GE lost their AAA rating after they reported the abysmal quarter.



Actually short positions in GE have gone up and GE is now number 17 on the Short List. Take a look at this Graph of GE Shorts. It is at or above a 12 month high.

The bump in GE just before close yesterday could be due to short sellers covering their positions before the weekend. It will be interesting to see what the short position after this weekend.

I hope GE recovers but GE's bond rating does not give me any solace given what happened to Citicorp, and B of A. Even the second largest Bank in France, Societe Generale lost $7.1 billion.

Only JP Morgan Chase has done relatively well having the reserves to buy Bear Sterns. I actually own quite a bit of JP Morgan Chase, or should I say Jamie Dimon because I believe he is the saviest CEO in banking today. Invest in people and not in corporations. When Jamie left Citicorp, that was the time to sell Citicorp, buy Bank One, then JP Morgan following Jamie Dimon. You could have known nothing about the companies, only the man and made money at every step. Even with the depressed price of JPM, it is higher than when Jamie took over the company.
« Last Edit: September 29, 2008, 13:53:35 PM by Silver Creek »
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Offline phg

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Re: Hmmm.. GE a good buy @ $32.50???
« Reply #32 on: June 14, 2008, 12:20:00 PM »
It's a tough call, and even tougher when you own a major position that you can't afford to liquidate.  All I can say is that, while I've considered GE several times in the past 5 years, I'm glad I didn't go for it. 

Offline Silver Creek

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Re: Hmmm.. GE a good buy @ $32.50???
« Reply #33 on: June 15, 2008, 00:49:28 AM »

Sounds like one of the many Jim Cramer followers. Viva la booyah

Are you kidding? I don't listen to Jim Cramer or any other self proclaimed expert. I haven't had a stockbroker or investment advisor since 1979. For the most part local stockbrokers are useless. They get paid to push stocks that their brokerage house is underwriting or has a position in so they can sell you the stock from their holdings. They never tell you when to sell. If they are so great, what are they doing in my city instead of working on Wall Street?

My favorite books are by are Peter Lynch (One Up on Wall Street and Beating The Street), John C. Bogle (Bogle on Mutual Funds), and Robert Hagstron (The Warren Buffet Way).

The best advice was from Peter Lynch who said buy a company in a sector of the economy that is growing and buy the number 1 or number 2 company in that sector because in any business there is room for only 1 or 2 gorillas. Go back to the early years of the PC and internet and see how that would have worked for you. Microprocessors - INTC. Personal Software - MSFT, Database - ORCL, Enterprise software - ORCL or SAP, Routers - CSCO, Service - IBM, Search - YHOO/GOOG, or even recently oil - XOM. Certainly in the case of MSFT, INTC, CSCO, ORCL, IBM, and GOOG there was a dynamic leader who was personally responsible for the success of that company. Where would MSFT be without Gates, INTC without Moore, CSCO without Chambers, ORCL without Ellison, and Google without Schmidt?

And you don't have to be in on the IPO to make money. If you had bought these companies several years after they became public, you would have done very well.

Investing is rather simple.

Rule number 1 - Find a sector of the economy that is growing and buy the leading company in that sector.

Rule number 2 - Hold onto that company as long as that sector continues to grow.

Rule number 3 - go back to rule number 1.



Regards,

Silver

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"Discovery consists of seeing what everybody has seen and thinking what nobody has thought"..........Szent-Gyorgy

Offline Silver Creek

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Re: Hmmm.. GE a good buy @ $32.50???
« Reply #34 on: June 15, 2008, 15:55:23 PM »
Silver,
Glad to hear you don't need any advice from the self proclaimed experts. Self proclaimed experts rarely do.


Just curious though, if you "don't listen to Cramer or any other self proclaimed expert", how is it that some of your favorite books are from Peter Lynch? :P

That's a good question.

Peter Lynch is just the opposite of a self proclaimed expert since he ran one of the most successful mutual funds, the Magellan Fund, which grew from $18 million in assets in 1977 to $14 billion in 1990. Only a few investors including Warren Buffet can claim a similar record. When he retired, Magellan Fund declined. His successor could not duplicate Lynch's sucess. I can't name any other mutual fund manager that has duplicated what Peter Lynch has done consistently over such a long time.

Secondly, reading a book that outlines sucessful investment strategies is very different than blindly buying and selling on the basis of a recommendation by an "expert." When someone studies a company and has definite criteria for why he/she thinks it will grow, he/she has the tools to measure whether that company is meeting the investor's criteria. The investor then has the tools to decide when to buy more stock or to sell. The investor makes the decision and not the expert.

Since this is fishing site, it is the differece between giving a person a fish or teaching a person to fish. To read Peter Lynch, John Bogle, and Warren Buffet is to be taught how to fish for stocks by the best in the stock fishing business. I don't consider them to be self proclaimed experts but experts in the real sense of the word.
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Silver

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"Discovery consists of seeing what everybody has seen and thinking what nobody has thought"..........Szent-Gyorgy

Offline Silver Creek

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Re: Hmmm.. GE a good buy @ $32.50???
« Reply #35 on: June 16, 2008, 09:51:15 AM »
I didn't know that about Lynch and it saddens me.

Nevertheless, you employ a common fallacy in your post is that you use an ad hominem argument which is to attack the person rather than what he says in his books. I don't care if Lynch is a transexual crossdresser and serial murderer. What my recommendation was is to follow the advice in his book, not his personality traits.

So lets get back on point. I ask you, what part of his books do you disagree with and why is that bad investment advice?
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Silver

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"Discovery consists of seeing what everybody has seen and thinking what nobody has thought"..........Szent-Gyorgy

Offline Silver Creek

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Re: Hmmm.. GE a good buy @ $32.50???
« Reply #36 on: June 16, 2008, 10:01:57 AM »
What you are probably seeing is institutional investors reducing their holdings.  Right now, about 59% of GE's stock is owned by institutional investors.  Short interest in GE is fairly low, however, about 0.6% so general sentiment would seem to be that this is near the bottom.  Was GE's dept downgraded recently?  I don't recall if GE lost their AAA rating after they reported the abysmal quarter.



Could this be the other shoe I refered to yesterday?
« Last Edit: June 16, 2008, 16:08:53 PM by Silver Creek »
Regards,

Silver

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"Discovery consists of seeing what everybody has seen and thinking what nobody has thought"..........Szent-Gyorgy

flatlander

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Re: Hmmm.. GE a good buy @ $32.50???
« Reply #37 on: June 16, 2008, 10:25:55 AM »
All this hand-wringing over GE?!?!?   Sell it for goodness sake! 

Hurry and get out Silver...your cost basis should be low enough that you still have a decent profit and you can still take advantage of the 15% cap gains rate before Obama raises it to 28%.  SELL SELL SELL! LOL



Offline Silver Creek

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Re: Hmmm.. GE a good buy @ $32.50???
« Reply #38 on: June 16, 2008, 15:30:57 PM »
I would sell GE if I needed the cash, but I don't. I responded to this thread because I am a long time follower of GE and I commented that I thought GE at $32.50 was not the time to buy. See my comment about Catching a Falling Knife below.

I also cautioned about buying GE if it has a slight recovery, see the Dead Cat Bounce reference below. GE

I also cautioned about the weakness in GE stock on last Friday on high volumes, increasing shorts, during a rising stock market which suggested to me that there were traders that knew information that we did not. Then GE was downgraded today. So was this luck on my part? I don't think so. I have made these same mistakes myself and I've lost money on my mistakes. It was suspicious that something fishy was going on with the stock.

Wait on the buy order.

You never know when the stock will turn around. "Don't try to catch a falling knife", otherwise you will get cut.

It is better to wait until the stock starts to rise again before buying but make sure that it is not a "dead cat bounce".


So was this quote made during a Dead Cat Bounce?

$33.33  as of 2:39pm........


Almost a buck a share!!!!!!


Your on a roll Woowe

Take a look at this chart of GE and check out the pattern of GE just before April 24 and what has happened since and you tell me if it is a dead cat bounce.

There can be multiple bounces so I would not buy even on the next bounce. Believe me, when GE recovers there will be plenty of time to get in. It is better to get in a little late and get out a little early rather than getting in too early and getting out too late.
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Silver

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"Discovery consists of seeing what everybody has seen and thinking what nobody has thought"..........Szent-Gyorgy

Offline Silver Creek

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Re: Hmmm.. GE a good buy @ $32.50???
« Reply #39 on: June 17, 2008, 14:53:54 PM »


Since I normally don't support a person that shits on those folks that are putting their lives on the line to protect his freedom to write those books, I haven't read any of them. Therefore, I don't disagree with anything in his books, I merely disagree with anyone that thinks his books are worth reading.  Call that type of thinking anything you'd like, but we also fought for my right to judge a man by his character and as such I've judged him to be a scumbag whose advice I have no interest in.
As far as I'm concerned, the dwarf tossing thing went over the line.


Troutrus,

With all due respect, from what you have said above, I believe you are unaware of the true facts.

You might want to read the actual New York Times Article on Improper Gifts rather than get your "facts" from a Don McNay Blog. Check the "dwarf tossing" charge that you leveled at Peter Lynch, since this drove you "over the line". It turns out this happened at a bachelor party for a trader at Fidelity named Thomas Bruderman. Lynch had no connection to this private party. Unfortunately the Don McNay article that you referenced distorted the facts and inferred that Lynch was to blame.

You should also read the New York Times Summary Article on the mutual funds sold to soldiers. It was not Fidelity but a company called First Command which sold contracted mutual funds from Franklin Resources, Aim/Invesco, Pioneer, and Fidelity. First Command is not a Fidelity company. First Command was founded by military officers. First Command contracts were even sold at West Point by officers to their cadets. These contracts were sold with cooperation of the military, and were sold on military bases with the full knowledge of the commanders. "In 2004, the Board of Advisor's included General Anthony Zinni, the retired Commander in Chief of the United States Central Command;[5] Coast Guard Commandant Robert E. Kramek, General Lloyd "Fig" Newton, and Vice Admiral John R. Ryan, former superintendent of the Naval Academy." So the truth is that First Command was founded by and is run by a bunch of military guys. So in the vernacular of Good Will Hunting, "How do you like them apples!" So why doesn't Don McNay trash these highly decorated officers who are the directors of First Command rather than Peter Lynch. Could it be that Lynch makes an easier target than laying the responsibility at the feet of the retired military officers of First Command?

To be completely fair you need to read the New York Times Article by Diana Henriques and the National Review Rebuttal Article by Patrick A. Swan who is a mobilized reserve soldier serving in Baghdad.

By what level of twisted logic does Don McNay get to the point where Fidelity becomes the primary responsible party and by a further twist lay that at the foot of Peter Lynch as he did? With the true facts clarified, you might want to reconsider this statement of yours, "Call that type of thinking anything you'd like, but we also fought for my right to judge a man by his character and as such I've judged him to be a scumbag whose advice I have no interest in."

Reread the Don McNay article and you will see that the accusations follow this line of reasoning and innuendo. Lynch is vice chairman of Fidelity - Fidelity sold bad investments to soldiers (actually a lie) - therefore Lynch is to blame for every bad thing that happened at Fidelity. Again faulty logic similar to the example: An elephant is grey and warmblooded - a mouse is warmblooded and grey - both are mammals, therefore an elephant is a mouse, except all the premises in the example are true where as the secondary premise in McNay's syllogism is false.

This is a combination of the logical fallacies of Poisoning the Well and Guilt by Association. Lynch is only responsible for the gifts that he received and for which he was fined. This amounted to $16,000 over his career whereas, Bruderman who was a Fidelity trader and the person most responsible for the fines, received $450,000.00 in gifts, but you would not know it from the Don McNay hatchet job, since this would rightly place what Lynch did in the proper perspective.

By your standards, one should not have invested in GE during Jack Welch's tenure because he has loose moral standards having cheated on his wife with Harvard Business Review Editor Suzy Wetlaufer. GE also polluted the Hudson River during Jack Welch's term at GE.

What would be the bigger "sin", taking the monstrous amount of $16,000.00 in unauthorized gifts over a 20 year career, or cheating on a wife of 16 years? My view is that neither "sin" have anything to do with the investment advice of Peter Lynch or the performance of Jack Welch as CEO. They show personal weaknesses.

Since you presumably blame Peter Lynch for the all the sins of Fidelity for which he did not have a direct responsibility, I suppose you would also then blame Welch for the pollution of the Hudson River by GE? This then begs the question what CEOs and companies do you know of that are totally blameless in every regard and will also grow faster than the market in general?

You certainly have the right to follow whatever investment advice you want. I'm not sure if this post will or can do anything to change your mind about Lynch. I post this so that those who are in the undistributed middle can have the facts and decide on their own.

I stand by my recommendation that the four books I recommended are some of the best and easiest to read on basic investment advice so that you can avoid making bad investment decisions.

I personally try to follow this rule: "When you throw mud, you will often muddy yourself and lose a lot of ground."
« Last Edit: June 17, 2008, 16:19:31 PM by Silver Creek »
Regards,

Silver

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"Discovery consists of seeing what everybody has seen and thinking what nobody has thought"..........Szent-Gyorgy

Offline Silver Creek

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Re: Hmmm.. GE a good buy @ $32.50???
« Reply #40 on: June 18, 2008, 15:38:02 PM »
Your suggestion that I confine my research to the New York Times article is a real laugher. Talk about an old cronies club.  :j

I personally try to follow this simple rule: "Don't piss into the wind".

I never suggested that you "confine" your research to the NYT. The reason I referred you to the NYT is that you should always check out the primary referenced material in the article you are using as the basis for your accusations. That is pretty fundamental. Since they broke the story, you should have gone to the original source of the story. If the NYT is an old cronies' club, maybe McNay shouldn't use them as the basis for his articles.

McNay writes, "It followed up on an award-winning New York Times series written by Diana Henriques. I wrote several columns about Mr. Lynch and Fidelity Investment, the company where he serves as vice chairman." This is the identical article I referred you to when I wrote, "To be completely fair you need to read the New York Times Article by Diana Henriques and the National Review Rebuttal Article by Patrick A. Swan who is a mobilized reserve soldier serving in Baghdad."

This rookie error suggests that you did not read either the original article or the rebuttal, and that you have no interest in independent thinking.

What is actually laughable is your line of reasoning, since you dismiss the NYT while referencing your guru McNay, who uses the NYT as the basis for his article. So what is it - Is NYT reliable or not? If it is, then you are wrong. If it is not then McNay is wrong. Since you rely on him, you are are wrong again.

How's it feel pissing into the wind?

  http://www.richmondregister.com/business/local_story_145235727.html
 



Same McNay story, different wrapper. Maybe you have another article that doesn't fail the logic test or are you a one man band?

You've made it clear that you don't care about moral character or whether a person be a transsexual or serial killer as long as they can make you some money. Good for you.

That's called hyperbole.

I guess I need to be more concrete in my replies to you. The point is that the truth is the truth whether it is disputed by a saint or avowed to by a sinner. The truth stands on its own merits. Investment truths are valid irregardless of who states them. They are to be judged on the their own merits and not on your personal perception of the merits who says them. Hence the hyperbole to drive this point home but obviously you didn't get it the first time. You also don't understand the Guilt by Association Fallacy since you keep repeating it.

BTW, I'm still waiting for your list of companies and CEOs that pass your morality test.

List em and we'll see how they do in this market.
Regards,

Silver

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"Discovery consists of seeing what everybody has seen and thinking what nobody has thought"..........Szent-Gyorgy

Offline Silver Creek

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Re: Hmmm.. GE a good buy @ $32.50???
« Reply #41 on: June 18, 2008, 22:13:16 PM »
1. Yes.

2. Yes, but it has not been shown that any business was exchanged for these "gifts. Lynch did admit that the gifts were above the level allowed by Fidelity.

3. Fishing Yes

Now you answer my questions.

1. Is there any proof Lynch had any direct envolvement with the Destiny I or II contracts and was Peter Lynch a part time or full time vice-chairman of Fidelity during this period?

2. a. Of the $1,200,000.00 Fidelity agents received from brokerage firms, how much did Lynch receive?
   b. Was Peter Lynch envolved in the "dwarf tossing" you accused him of?

3. Name just one company that you would buy now that you are positive has never paid a fine or settled a lawsuit. We'll see how it does.

How's your fishing been?
Regards,

Silver

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"Discovery consists of seeing what everybody has seen and thinking what nobody has thought"..........Szent-Gyorgy

troutrus

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Re: Hmmm.. GE a good buy @ $32.50???
« Reply #42 on: June 18, 2008, 22:13:54 PM »
I'm out of this. Getting a little too personal for my liking. Besides, you're just too smart for me, even if you do use words such as irregardless. ???

How 'bout a fishing report from cheeseland?

Offline Silver Creek

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Re: Hmmm.. GE a good buy @ $32.50???
« Reply #43 on: June 18, 2008, 22:21:20 PM »
Me too. I'm going fishing tomorrow.

Fishing has been a bit slow. Too  much rain but the fish have been healthy.

Here's a nice piece of water that I am going to go to tomorrow.

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Caught this guy a week ago

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Regards,

Silver

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"Discovery consists of seeing what everybody has seen and thinking what nobody has thought"..........Szent-Gyorgy

troutrus

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Re: Hmmm.. GE a good buy @ $32.50???
« Reply #44 on: June 19, 2008, 07:39:50 AM »
Nice looking water and a beautiful fish.  0--0