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Monthly Archives: August 2011

Cantor Fitzgerald Las Vegas Optics #lasvegas #sportsbook #cantorfitzgerald

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Cantor Fitzgerald announced additional inroads into the Las Vegas Sports Book market. Do I care. Not personally. But with Obama and the O boys beating up Wall Street every chance they get the Las Vegas optics will be politically difficult. Deep Obama loyalists will only see a straight line connect the big dots between Wall Street and Las Vegas. End of analysis.

Cantor is not a publicly traded stock. It touts itself as one of the few remaining partnerships on Wall Street. It is one of the few Primary Dealers of US Debt. Because it is private it does not have to worry about PR like say a Goldman Sachs (NYSE:GS). But it would have been wiser to brand it a little differently and avoid the political problems that are coming it’s way.

Disclosure: George Gutowski writes from a caveat emptor perspective. I do like to put a little money down on a game now and then. I do not have any positions in stocks mentioned in this post. I have no plans to initiate new positions within the next 72 hours.

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Conrad Black kicks Rupert Murdoch in the balls. $NWS #conradblack #rupertmurdoch

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Conrad Black has tried to kick Rupert Murdoch News Corp (Nasdaq:NWS) in the balls in the upcoming Vanity Fair edition. That’s the one with Angelina Jolie on the cover. Newsstands in NYC and LA Sep 1, iPad Sep 6. Conrad Black who is on his way back to jail complains about Rupert Murdoch’s bitch slaps that he has had to suffer. This from a man about to go back to finish up his sentence. Rupert Murdoch is spending a lot of time wondering how he can stay out of jail. The two guys supposedly have similar philosophies but would probably gladly have their butlers choke each other to death.

Conrad Black ever controversial wonders if he can survive on about $80 million. A few more years and then he will come out. I predict Barbara Amiel will have a cotillion like ball as Conrad Black thumbs his nose and does what ever he wants only restricted by his $80 million. Will it be one of those marvellous Vanity Fair parties. Rupert your invited of course hope you can make it.

Disclosure: George Gutowski writes from a caveat emptor perspective. I usually don’t give a rats ass what happens to these two guy’s on a personal level. There are just fascinating reads.I do not have positions in any stocks mentioned in this post. I have no plans to initiate new positions within the next 72 hours.

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Google makes #Obamacare more expensive Thanks a lot. #Druglobby wins big $GOOG

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Google (Nasdaq:GOOG) agrees to forfeit $500 million because it was a distraction as they try to gobble up Motorola. Now American citizens will have to pay more for prescription drugs. Obama who claims he wants health care for all is now aware that price conscious Americans will get screwed over price wise.

Google agreed to the deal as a result of a Dept of Justice investigation. Hey Obama who you been appointing over there. You just sold out to the US drug lobby who wants to charge more for prescription drugs.

This is not congruent with your publicly expressed views.

Drug Lobby wins big, very big.

Disclosure: George Gutowski writes from a caveat emptor perspective. I am suspicious of pricing models when I am required to buy something. I hold no positions in stocks mentioned in this post. I have no plans to initiate new positions within the next 72 hours.

 

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Cdn Pharmacists loose billion dollar market #ShoppersDrugmart #Jeancoutu #adword $GOOG

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Google (Nasdaq:GOOG) forfeits $500 million in ad word revenues from Canadian Pharmacies selling good drugs to price conscious Americans. As this program comes to a screeching halt  Canadian Pharmacists will lose access to a billion dollar market. So much for free trade.

So which group of Canadian Pharmacists will take the financial hit. Shoppers Drug Mart (Toronto: SL-T) and Jean Coutu (Toronto: PJC.A-T) are the two big pharmacy guns on the TSE. Several large grocery chains also have significant pharmacy operations. Or was it some entrepreneurial independent Canadian pharmacists who figured it out and made a killing.

This took place over many years but to pay advertising costs of $500 million you have to move a lot of product to make it worth your while.

Disclosure: George Gutowski writes from a caveat emptor perspective. I hold no positions in stocks mentioned in this post. I have no plans to initiate new positions within the next 72 hours.

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Google abandons Canadian smuggling $GOOG #prescriptiondrugs #FDA #dealbook

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Google (Nasdaq:GOOG) has to abandon Canadian Pharmacies that were using Ad Words to get US citizens to buy pharmacy quality drugs at low Canadian prices. Google has to abandon $500 million which is the estimated profits from the Ad Word program.

So Google cash goes down a little bit. Beleaguered American citizens seeking relief from high cost drugs are screwed. Read this snippet from New York Times D%l Book [Deal Book]

“The United States attorney for Rhode Island, Peter F. Neronha, whose office was responsible for the investigation, said Google’s conduct was not the result of a few rogue employees, according to The Wall Street Journal. Mr. Neronha said the company’s chief executive, Larry Page, “knew what was going on.”

Larry Page was in on it. The master of algorithms knew and just kept cashing the cheques. Hmmm.

The problem for Google will be with other jurisdictions who will want to control the sale of pharmaceutical grade drugs and eventually other items of commerce. The $500 million forfeiture will go a long way with many cash strapped governments.

Sure this is a distraction during the Motorola deal. But if governments learn to control the algorithm they will enhance tax revenues and you know they will want to do that.

Disclosure: George Gutowski writes from a caveat emptor perspective. I buy my prescription drugs from a licensed pharmacist at a bricks and mortar location because I consume pharmaceutical drugs in a hyper caveat emptor context. I hold no positions in stocks mentioned in this post. I have no plans to initiate new positions within the next 72 hours.

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Warren #Buffett conversations become reverse insider trading $BAC $WFC $BRK.A

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Warren Buffett pulled the trigger and invested a spare $5 Billion in Bank of America (NYSE:BAC) preferred shares. Definitely likes the pay while waiting approach. Should be a brilliant move. Classic value investor strategy: buy ugly sell pretty.

Now he is a major force in two big banks which are still in the two big to fail category. How often does he talk with management and individual boards of directors. Now that he has two eggs in the game, bank management will be very keen on listening to the Oracle for insights that they otherwise might not have. Conversations will be parsed and psycho-analyzed.

I can just see the informal board chit-chat before the formal proceedings. All one director needs to say is I was speaking with Warren and this is what he thinks. Warren Buffett may not remember every casual conversation. But the other guy will.

Then there is the question of head to head competition between Bank of America and Wells Fargo (NYSE:WFC). Don’t tell me they will not knock heads in the marketplace. Why not check with Warren and see what he is thinking? After all why would you not reach out to the best investor astride on the planet?

Warren Buffett’s silence will be as meaningful as his words. The few times he will not want to go there will be enormously meaningful to the questioner. If you believe in six degrees of separation conversations will be extremely difficult.

Disclosure: George Gutowski writes from a caveat emptor perspective. I do not speak with Warren Buffett but wish I could on occasion. I do not hold positions in stocks mentioned in this post. I have no plans to initiate new positions within the next 72 hours.

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Sino-Forest goes timberrrr after #OSC chainsaw slashes $tre

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On Friday the leading Canadian securities regulator demanded executives of Sino-Forest (TSE:TRE) resign because of fraud. They did not even include a polite hand wringing please resign as you sometimes expect from Canadian securities regulators. The evidence was overwhelming and they pulled the trigger.

After the bullet left the chamber they realized they could not demand resignations. During the weekend the executives named decide to resign anyway. The niceties of a regulators powers and terms of reference were insufficient. The evidence is damning and they have to get out of dodge. Some say the inside committee that was reviewing the scandal tipped the OSC that the boys were leaving town and let the OSC look good. Hard to say?

The OSC has taken a lot of heat for tardy regulation. They just miss too many scandals. So a new team is trying to fix the problem. They pulled out their six-shooter and applied justice as best they could.

So who is in charge now. An independent director. Were the independent directors awake in the first place? BTW the OSC is a provincial regulator covering Ontario. Ontario is heading in a general election. Most political parties and the voter in general do not understand what the stock market and securities regulations are or should be. Nice time to be a cowboy.

Disclosure: George Gutowski writes from a caveat emptor perspective. I support the concept of a national securities regulator in Canada. I do not hold any positions in stocks mentioned in this post. I have no plans to initiate new positions within the next 72 hours.

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Krispy Kreme No Mexican Stand-Off Needs encore performance $KKD #qsr

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Krispy Kreme reported Q2 numbers and cash in the till went up. But wait a second how did they do that? Turns out they had a 30% equity interest in a Mexican Franchise which they sold. They used the proceeds to repay a big chunk of debt and were able to say interest costs were down. But a big slug of debt still awaits and Krispy Kreme is not a situation that lends itself to leverage.

Speaking of the sale they did disclose it was for $7.2 million but then with transaction costs and Mexican taxes they netted a paltry $4.7 million. If they are prepared to exit Mexico that badly is it because the Mexican market or partner stinks or is the debt load that serious.

No word from management as to what they will cannibalize next or are they just planning to grind out the debt payments like another debt slave. The sources and uses of cash still looks erratic.

Disclosure: George Gutowski writes from a caveat emptor perspective. I am convinced Krispy Kreme makes people fat and diabetic but that does not violate any SEC regulations. I do not have any positions in stocks mentioned in this post. I have no plans to initiate new positions within the next 72 hours.

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SEC mis-regulates again. Fracking witch hunt is federalized. #SEC #fracking #corpgov #irchat

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WSJ reports that the SEC is bearing down on Fracking. The Securities and Exchange Commission which is tasked with regulating capital markets and is constantly under-staffed and under-resourced thereby allowing pirates to loot pillage and rape on Wall Street is asking oil and gas companies for detailed information about the use of “Fracking” The information is to include details about chemicals used and efforts to minimize environmental impact.

Does the SEC have a body of competent employees who can assess detailed fracking information. I think not. Why would the SEC do the work of environmental regulators? bureaucracy running rampant.

But remember this could be all part of the great Marcellus Shale conspiracy theory. By getting the wrong regulator involved in the fracking investigation you will only screw up the reports and eventually throw them away as useless.

But if you are a securities lawyer with some knowledge of fracking your market value is up big time.

Disclosure: George Gutowski writes from a caveat emptor perspective. I personally have no involvment in fracking but I do heat with natural gas. I have no positions in stocks or commodities mentioned in this post. I have no plans to initiate new positions within the next 72 hours.

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Steve Jobs Tim Cook Machiavellian Thoughts $AAPL #stevejobs #timcook #machiavelli

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Steve Jobs of Apple (Nasdaq:AAPL) finally resigned supposedly on his own terms. The Hewlett-Packard (NYSE:HPQ) Touchbook rout just icing on the cake. Everyone cannot say enough great stuff about Steve Jobs and that is the problem for Tim Cook.

Machiavellian thought counsels to not follow popular princes. Their legacy is powerful and you will be constantly compared in an unfavourable light. It is better to follow a bad prince well just like Steve Jobs did about 13 years ago.  every hiccup will be Tim Cook’s fault. Steve Jobs had hiccups and worse but it was OK. He was Steve Jobs.

Tim Cook undoubtedly is an excellent choice in everything except timing which no one can control. The Apple mystique will change and for high-tech that’s a very good thing.

Disclosure: George Gutowski writes from a caveat emptor perspective. I do own iProducts. I do not have positions in any stocks mentioned in this post. I have no plans to initiate new positions within the next 72 hours.

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