Buying the dip

Did couple of careful buys. Yesterday bought a little bit more of Banco Bradesco, today, a little bit more of Phillip Morris International. Market is really scary. That's exactly the time to buy (I hope).

I'm tired of talks about energy, alternative energy, future energy, peak of oil, etc. Preparing an article on that issue, from economics point of view. Should say one thing though right now. My respect to Paul Krugman (quite high) dropped a lot after reading these two articles:
Driller Instinct
Fuels on the Hill

I'd like to see respected professor to support his view by hard data. And also to explain why, if supply of oil can't meet demand, we shouldn't drill? The talk about alternative energy and fuels is just that, talk. Although lately it turned up deadly. I'd like to know how many people died of hunger in Africa as a result of much higher food prices triggered by US Congress mandated use of biofuels. Bad economic decisions quite often kill people, literally.

More on this later.

Euro 2008 is the best I've seen. Enjoy it immensely.

Full disclosure: at the time of publication author had long positions in BBD and PM. Positions can change any time.

Disclaimer: This article is not intended as an investment advice. Every person should make her/his own investment decisions based on all available information and advice from her/his own financial advisor.

Trimming Apple

Started trimming my Apple (AAPL) position today. I outlined reasons to be careful with Apple not that long ago here. New rumors about Steve Jobs health just added to those thoughts. This position grown up quite big in my portfolio, it's the largest one, almost 15%. Time to trim it to something below 8%. Usual discipline applies: panic selling and panic buying are equally wrong.

Full disclosure: at the time of publication author had a long position in AAPL. Positions can change any time.

Disclaimer: This article is not intended as an investment advice. Every person should make her/his own investment decisions based on all available information and advice from her/his own financial advisor.

Cramer Is Wrong. Or Maybe I Am.

I don't remember being in such disagreement with Jim Cramer. He's pimping energy, commodities, ag and "New Tech". I don't think either of these has long term (more than a year) growth perspective. Most agricultural product prices are going down (corn is an exception, so far). Most metals are going down right now too. Energy (oil first of all) is holding, but oil's parabolic chart is screaming "Bubble!". Increased volatility on oil market lately might be a sign of turn, like it was for gold. And his last thesis, international exposure, doesn't hold up, because dollar is going up against all currencies lately.
Maybe Jim is right, and his ideas might work for a while. Maybe they will work for a long time, which goes against everything I know about economy. The main theme in economy for the last 200+ years: human capital is becoming more expensive compared to commodities.
I have big exposure to international companies right now. I think of moving more to US based companies. I'm going to reduce exposure to anything related to commodities.
Still looking for big ideas related to the next big shortage, shortage of labor. World needs big innovations to feed, upkeep and support aging population with less workers. There is no way around it, we have zero growth, and, in some areas, negative growth of population. That's almost everywhere in the world. Of big regions, only Africa still has high population growth rate.
Another theme: shortage of IT workers. It might seem surprising. Many people think that India can supply unlimited numbers of programmers to the world. Wrong! India right now can't even supply enough for itself. I'm amazed at what I see in IT departments in US right now: most people there are over 40! OK, that's with exception contractors from India, but it's probably first time in history when IT workforce is aging. There should be some money made on this trend, I just don't know how. Yet.

Euro 2008 is wonderful. Van Basten was the greatest striker I've ever seen, I'm starting to believe that he's a great coach as well. Too early to say, of course. We'll see.

Disclaimer: This article is not intended as an investment advice. Every person should make her/his own investment decisions based on all available information and advice from her/his own financial advisor.

Krugman Is Great (Sometimes...)

Somebody had to say it. Thank you, Paul Krugman. This article is right on point. No, we are not in runaway inflation. No, there is no reason to believe we are getting into one.

I want to try new strategy for finding growth stocks. It's mathematically correct, although any value investor would call it crazy: pick stocks with low PEG and high P/E. By definition, it implies high projected growth rate. All caveats apply, of course.

Due to coming Euro 2008, posts in this blog are going to appear less frequently for the next three weeks.