BAGAKOAA; 6 May 2012 Risk On Risk Off

Post 641

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May/2012
First off, thank you for the hundreds and hundreds of calls and e-mails and letters concerned about my whereabouts as I have not posted since May 1,2012. Ok it was not hundreds and hundreds and hundreds. Actually it wasn't even dozens and dozens. I am afraid to say I got three notes asking me what was going on. Blogging is a lonely world.

 

In fairness to you, I did say it would be a hectic two weeks and it has lived up to its billing. Fortunately we are halfway through the crazy times and should be back on line next week. Because we have been so busy at work and with personal business, there is not much to share with you. (What was that noise, a collective sigh of relief?)

 

Devin is recuperating quite well from her surgery. She is not as needy as she was a week ago, but her neediness has morphed into a perpetual state of entitlement. Take today for instance. She had to go to a shower type event in Long Beach California. We are entertaining a couple of execs from our offices in England and Australia tonight (I am typing this as I await there arrival.) I was planning to get the house squared away for visitors, but The Queen was assigning chores by saying "You can do this and you can do that. . . " as though they were pleasurable desires that I really wanted to do. I have a feeling should I say to my darling wife, "You may take my shoes upstairs now." I would be the one in physical therapy.

 

But again she is still recovering and doing extremely well so I enlarge the hump on my back, drag my right leg behind me, close one grotesque eye and utter, "Yes massseerrrrr." (Quasimodo if you were wondering aka the Hunchback.)

 

Last night we let our hair down and went to Friends to hear a couple of reader's son, Casey Moreta, and his band Tremor. Now I am not a huge fan of 80 classic rock, but they were so good in their cover of these classic hits, it was amazing. Mary, the owner of Friends was cool as this is a kids band aging from 13-16, and she was so blown away she paid them for their appearance. It was their first paid gig. If your in the neighborhood drop buy Mary's for drink and thank her. That was cool.

 

Also, thank you to the folks who helped Kristin Scannell with her mission to Africa. Those who contributed last week, you should know she really really appreciated the donations. She has a bit further to go Boys And Girls so follow that link off to the right and help Kristin get the rest of the way to Africa and build playgrounds for kids who need it.

 

When I wasn't busy with meetings and or personal business, we have been unloading stuff we have had in storage over the last eighteen months. We finally emptied the big storage unit that has been in front of the house since last June, and we brought in our portable storage unit (PODS) back on Friday. We unloaded it and it was kind of fun as I had written witty things on the boxes incase if archeologists find these things 6,000 years from now. In one box I put "Jimmy Hoffa". In another I put "The shroud of Turin". In yet another, "6 bars of gold" and all I could picture were those goofy guys on "Storage Wars" opening out storage unit and seeing "6 Bars of Gold" written on a box and have them bid the auction up to 800,000 dollars to find the Elvis Barbie doll.

 

We did find a box marked Jack's memory and here we are trying to get it back in his brain.

 

I here a couple of guys with funny accents so I will finish this later.

 

So this Englishman, an Australian, a beautiful brunette, and a chubby Irishman walking into a Mexican restaurant. . . . no it's not a joke, that is where we went for dinner tonight. After a drink and walk around the rebuilt home at Chateau Cronin, we headed down to Roses Cantina. It was fun low key evening. But tomorrow will be here before you know it so let's wrap this up.

Risk On Risk Off

 

Last week was an interesting week to watch. As we watched, which was about all we could do being focused on other things, we saw some highs and lows. The week finished down 1.4% on the DOW, 2.4% on the S&P500, and 3.7% (Can you say a weak week for AAPL) on the Nasdaq. The week culminated in a poor jobs report that made Mr. Market move from a risk on to a risk off position. More importantly, we saw enough volume on the downside last week that we confirmed a market in correction on Wednesday the 2nd. We are now in a RED FLAG status. Our rally, should you call it that started on April 26 and ended on May 2nd. It is time to look at profits, watch out for losers, and be very cautious.

 

Early this morning we were able to read Barron's cover to cover. There are a lit of mixed messages out there. We are just waiting and seeing.

 

This week we sold out of ESIC EasyLink Services International Corporation provides communication applications that enable enterprises to communicate with their customers, trading partners, and other third parties. We told you about this stock about two weeks ago as we found it using the Auer Screen supplemented by the Buffet Evaluation sheet. Well apparently OpenText also liked the value of ESIC as on the first of May, they announced a buy out giving most of the Salve Lucrum family and nice 21% bump. We took the win to the bank.

 

The trading gods did not look favorably on our ACET position. All the SL Family accounts dropped out of this core stock with an 8% loss on Thursday and Friday. They had a solid earnings report, but slightly missed analysts sales expectations so they got slapped on Friday. A 7% drop was overkill. We are looking to get back in tomorrow which might create a wash sale situation where we carry our recent loss value forward. We don't mind because we think this is now way undervalued. A little more homework tonight.

 

We hope to have some more time to do a forensic on another trade we lost on last week. We bought some call options on BRCM. We expected they would beat, they did. We expected they would have good guidance, they did. We expected the call would jump as the stock went up. They didn't. It has us scratching out heads, but that's what makes this so much darn fun.

 

Good night boys and girls.

 

 

Salve Lucrum 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Brian Ireland
 
Since 5/2/2012
BAGAKOAA;

I am not a professional investment advisor. Anybody reading my blog and investing accordingly must be out of their minds. I have made more money than I have lost. There are many more qualified people than I to actually tell you how to invest your money.

BAGAKOAA=Boys And Girls And Kids Of All Ages

Salve Lucrum=Latin for Hurrah for Profit.

2012 Year Ending

Dow 13,073

S&P 500 1,358

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