Dear rss free blog,
In case
there are any doubts, I invest in the same stock markets as anyone else does
and my pocketbook has been bashed for the past week and now is emerging from
its collapse. Every speculator, day-trader, or hedgie was selling short the euro
and National Bank of Greece
and using other portfolio assets to fund this. Today every short seller having
shorted, the balance in the Trojan War shifted slightly the other way.
Rare
indeed is the fund manager or investor who can dodge this kind of selloff. Not
claiming to be a market timer or a clairvoyant, I tend to be skeptical of those
who do make such claims.
Having
advised the Greek govt. Joe Stiglitz came up with some words of comfort for our
own, according to Bloomberg, calling the prospect
of a U.S.
or British default “absurd.” The Nobel laureate economist said both countries
“deserve to keep their AAA rating” adding “the likelihood of a default is small
in the US
because all we do is print money to pay it back.” He called the panic over US default
“another reflection of the absurdities in the financial markets.”
Speaking
at the London School of Economics, Joe said “what we need now is a second round
of stimulus” aimed at homeowners. Without it “the heavy level of indebtedness
is going to press down on the economy.”
Which is
to say the lesson of the Asia contagion IMF medicine — that budget cuts and
deflation exacerbate the problems – now apply to the USA.
Introduced by a reader, your editor
attempted to open a brokerage account with Charles Stanley Co.,
U.K.
brokers. Here’s what they wrote:
Thank you for
your e-mail. I regret that we are unable to offer our services to anyone
living in the US
due to regulatory and legal complexities. In essence, the US requires any UK
brokers offering services to US taxpayers and residents to comply with US tax and
securities regulations. This is something we would be unable to
do and therefore we would be unable to open an account for anyone living
in the USA.
Another
reader, a Canadian, reports access was blocked to his TD Waterhouse
account when he was visiting south of the border. The account is domiciled in Luxembourg and
TD blocked access from US-based internet service providers.
More and
more, USAN investors have to confine our investing to US-tradable stocks,
bonds, and funds. While their number is growing, it is still annoying to be
left out of deals. I was tempted by Charles Stanley’s Croesus
analyst newsletter’s recommended play on the planned split Mar. 22 between Cable & Wireless plc in Britain and its tempting international
holdings (between the future London-listed CWS and CWW.)
There is a
history here. Cable & Wireless delisted from the NYSE voluntarily on Dec.
13, 2005 and cancelled its American Depositary Receipts program after becoming
the butt of securities litigation and class action suits from US and Canadian
investors for years. The lead case was settled out of court in mid-2004 by Cable
& Wireless paying over $7 mn with no admission of guilt to the plaintiffs, Ontario Teachers’ Pension Plan et al.
Having sold Ternium last year after its Venezuelan steel mills were
nationalized, we are not surprised that compensation payments have been
delayed, and Caracas now owes the Argentinian company (incorporated in
Luxembourg, however) about $1.02 bn. TS will not win support from La Presidente
Fernandez who needs political and financial support from Hugo Chavez.
More for
paid subscribers follows mostly about Singapore to start with.
*We are
investing in offshore oil drilling in Vietnam
thanks to a new joint venture by X of
Singapore.
It is a minor part of the business but is enough to satisfy my urge to
get into ‘Nam.
*Bonus
stock Cognizant Tech (which is owned by
Indians and operates in IT there) beat forecasts with a 28% rise in Q4 earnings
on revenues up 20%. This is my favorite Indian outsourced consulting and IT
company even though it is HQ’d in NJ. Sales topped $902.7 mn in the quarter and
eps in GAAP terms came to 47¢/sh vs prior year 38, nipped by a 1¢/sh forex
loss. CTSH predicts that this year it will achieve sales of $3.9 bn vs last year’s
fullyear $2.03 bn.
