About stock market and bread

Yesterday was one of those boring days. The U.S. market was down more than 200 points early on the trading day. (Please do not ask me what was the reason. There were so many things to explain in this big U.S. stock market.)

Okay, okay… Negative comments from Fed Chairman Bernanke, Fed Vice Chairman Kohn, and Fed Governor Mishkin have weighed on market participants’ sentiment at the beginning of the trading. News that Intel lowered its 1Q gross profit margin due to sharper-than-expected decline in NAND memory chips. Also, Citigroup fell down to a nine-year low after Merrill Lynch cut its full-year earnings forecast for the company. Merrill said the bank could take another $18 billion in write downs related to bad mortgage. The negative comments of the CEO of Dubai International Capital that Citigroup may need more funding to alleviate Citi’s financial woes compounded the worries (are we or are we not in recession?) of the investors.

To summarize, the confluence of negative news (disappointing earnings forecasts) and the pessimistic comments (from the central bank officials ) brought the market down.

Okay. Let me go to the bread.

Going into stock market

Few minutes after my tennis game last Friday in the ongoing All Filipino Tennis Tournament, a Kabayan approached me. He told me that I could probably be the right guy who could give him tips on how to invest in U.S. stock market.

I have no idea where he got the information that I am connected to this type of service, that I could be of help and the right guy. Am I?

While resting and enjoying my sweet victory, he enumerated with passion the reasons why he is interested in investing in the U.S. stock market:

• he learned from his friend that investing in stock market is one sure way to make money.
• he has some cash that he can use to play in the U.S. stocks.
• he too can do what his friend does – making money from U.S. stock market. “Kung kaya nya, kaya ko rin.“

Few minutes have gone by, notwithstanding my not-so-encouraging remarks, I noticed that the guy is hell-bound, este hell-bent on following his friend’s investment tale. The idea that he can make money easily on stock market is so great that (I presumed) his clear thinking is overwhelmed by his emotion. Being the case, with this type of investor (as always), no amount of logical explanation will suffice and whatever rational discussion is just a waste of time.

DEBT that sounds like DEATH

I was with my politically incorrect (whatever that means ha ha ha) friend the other day. We were talking about Gloria’s SONA 07  (State of the Nation Address also known as Same Old Nuts Again) and a lot of other things.

Although he expected the same things from Gloria’s speech, he was surprised and awed by the grandiosity of Gloria’s dream especially the projects that she wishes to accomplish at the end of her term(if that really is true).

Friend: Where is the money? Our government has no money, di ba?

Me: Our government has billion peso budget deficits (always), right?

Friend: What is the connection?

Me: This simply means that our government is spending billions of money every year whether it can earn the money or not. The budget deficits and the growing debts indicate that there is money to spend. The question of where is the money is not a question at all. People in the government can make money easily.

Friend: What do you mean? How they do that?

Me: Simple. Do you have money now?

He checks his wallet.

Friend: I have 10 Riyals and a few (but very expensive) peso bills. Ha ha ha.

Me: But you want to buy that last piece of Babolat tennis racket. And you promised your son that he will have his Mac Book Pro this month.        

About Gloria, politicians and us

Napanood ko si Gloria Kahapon sa isang balita sa TV. Nakatuwa sya dahil ayon sa balita pagkadating na pagkadating niya mula sa kanyang foreign trip dumeretso agad sya sa Divisoria para alamin kung ang presyo ng mga bilihin ay tumaas in particular ang presyo ng school supplies. Habang hawak ang isang box ng crayon, ipinagmalaki pa nya na wala naman palang pagtaas ng presyo.

Very touching indeed. Kakalaglag ng puso sa unang tingin. Ang babaeng pinaka-powerful sa bayan kong Pilipinas, concern na concern sa mga Pinoy.

Pero hindi. At hinding hindi! Dahil unang una na, hindi buong Pilipinas ay may Divisoria na pwede nilang puntahan para bumili ng mga school supplies ng kanilang mga anak. At hindi po ito ang isyu na dapat ikatuwa ng mga magulang na hilahod sa pagpapaaral ng kanilang mga anak.

Bagamat makakatulong ito kahit katiting, ang tunay na isyu po ay ang walang habas na pagtaas na tution fees ng maraming pribadong paaralan sa buong Pilipinas. Bukod pa dito ay ang kakulangan ng mga public school buildings, mga teachers at mga textbooks at kung ano ano pang mga bagay bagay na kailangan ng mga kababayan nating di kayang magbagyad sa mga pribadong paaralan, na walang pakialam sa mga kabataan kundi sa perang papasok sa kanilang mga bulsa.

Ginang Gloria, yan po ang mga tunay na isyus at hindi ang presyo ng mga school supplies.

Boring market and Idle mind

Yesterday night was a boring night for me. It was really boring.

The Reason:

The U.S. stock market had a tough and choppy start because investors were worried about the situation of the New Century Financial Corporation (NEW.N), the largest independent U.S. subprime mortgage lender. It said that its lenders had cut-off financing or indicated to stop financing the company thereby pushing it in the likelihood of filing bankruptcy or asset liquidation.

The New Century Financial Corporation’s share was hammered from USD 30.00 a month ago to USD 6.00 plus a week ago and USD 3.21 on Friday’s close then plunged to USD1.65 before it was suspended Monday.

I have no idea as to what will be the extent of its effect on Tuesday’s trading and how, if there will be any effect at all, will other global markets react today. I just hope that this will not lead to something that will trigger a repeat of what happened weeks ago. (When the giant sneezes, the dwarf gets the colds.)

For the time being, let us leave this matter to them- the people concerned and let me continue with what I am supposed to do: Blog.

The Problem:

As I have said, it was a boring day. There was No Action. Our customers, I supposed, were out somewhere doing something else.

It was natural therefore that I had nothing to do as well except to read and read whatever items my eyes could see from Reuters for hours. It was tiring and I could feel that my back was looking(?) for a bed.

The Solution:

So, in order not to invite sleep during working hours (evening here in this part of the world), I decided to do an exercise inside the trading area. I walked and walked and walked with nothing in my head (figuratively or possibly, literally(???)).

The Result:

I already had twenty rounds when suddenly the air (so there was something inside) that was circulating inside my brain was pushed out by crazy thoughts.

I stopped walking because these crazy thoughts kept on coming and going, coming and going, coming and going. Then finally, U.S. stock market closed (11:30 p.m. here). It was time to go home.

Moral of the story:

The boring market creates an idle mind. And true enough, the idle mind is the workshop of the he he.

Recommendation:

Stay away from boring market. Keep on blogging and visit your favorite blogs. Just make sure your Boss won’t see what you are doing.

NOW you know what is boring market and idle mind. ha ha ha.

Note: The Stocks strike back but then, most of our customers stayed away.

Tags: myepinoy, New Century Financial Corp, U.S. Stock Market, pinoy

Our PISO, bow…

What do you think can our humble Piso and Sentimo do nowadays? Do they still have material value?

I asked my friends these questions and they all gave me a question instead of an answer – what question is that? Even Kulas, who I resurrected, gave me a wink and asked me “are you drinks? (translated as one too many drinks in short are you drunk?) Can you buy a small candy with your Piso or sentimo? They are only good for the church – pang simbahan na lang yan.”

They are probably right however, there are people who would say otherwise especially the two Taiwanese traders who were caught recently by NBI buying our coins, not in small quantity but tons of it.

What prompted these so-called traders to buy our Piso? Obviously, our Piso is money but that is not important to them. What is important to them is the metal that is inside called copper (CU) that would give them huge profit because they are very cheap and available everywhere in our country.

The circulating Phillipine Peso coins (25 cents, 1.00, 5.00 and 10.00 pesos ) are made up of 25% nickel and 75% copper.

Nowadays, copper is used in products such as electronics, structural engineering, household products, and a host of other things . The electrical wires, roofing materials and the integrated circuits of the computer you are using now have copper inside.

The data from world metals exchanges shows that copper prices are getting up. It has has risen to nearly $7,000 a tonne on the back of strong demand and worries over supply. The most recent price of copper (CU) from the LME (London Metal Exchange), Monday, 27 November 2006 is as follows:

Cash : $3.1928 per pound | 3-Month : $3.2114 per pound

Check here and here.

Our Piso, in case you do not know silently found a place in the U.A.E. and created a stir which unfortunately entered in Wikipedia as Fraud problem with 1 peso coin

By August 2006, it became publicly known that the 1 peso coin has the same size as 1 United Arab Emirates dirham. But 1 peso is only 7 fils (0.07 dirham) worth, leading to dispense machines frauds in the U.A.E..

As they always say in metals exchanges: “All metals are precious.” And so our Piso is!

To our humble Piso, bow.

Tags: myepinoy, Philippine peso coins, copper, copper futures market, LME, Pinoy, Pilipinas