Watch Out For the Real Inflation Rate of Seven Percent -09/17/14 at 8:02 PM CDTby Perry Rod

Today, the United States Federal Reserve decided to continue its strategy of aggressive money printing, now in its sixth year after the market meltdown. The government today notes that inflation is low and under control. But here's the fundamental economic reality: The value of cash has been going down by an average of about seven percent per year. Compo...

John Paulson's "Greatest Trade Ever" - Something of a Scam -01/20/10 at 10:34 PM CSTby Mark Mitchell

By now, everybody knows that the market for collateralized debt obligations was riddled with fraud in the lead-up to the financial crisis. What is less known is the fact that hedge fund managers helped create and inflate the market for these toxic securities specifically so that they could bet against them and profit from the inevitable collapse. An examp...

SEC OIG Investigating SEC Complicity in Naked Short Selling of Dendre... -12/01/09 at 6:35 PM CSTby Mark Mitchell

The Office of the Inspector General of the Securities and Exchange Commission not long ago submitted a semi-annual report to Congress. There are two items in the report of interest to those of us who have argued that the SEC has turned a blind eye towards, or even assisted, unscrupulous hedge funds that make their fortunes destroying public companies for ...

Retail Investors Outperforming Professionals With Citigroup, Ford, an... -08/21/09 at 11:14 AM CDTby Peter York

In today's market, it's not the professionals who are celebrating as much as the retail investors.  Consider three stocks that seem to show up in retail portfolios everywhere: Citigroup Inc. (C), Ford Motor Company (F), and Sirius XM Radio Inc (SIRI).  Institutional ownership in these stocks are well under 50% which suggests a significant retail...

Citigroup When-Issued Share Discount Narrows -07/27/09 at 11:09 AM CDTby Peter York

The discount on when-issued shares of Citigroup Inc. decreased today from 5% to around 1.5%.  Citigroup buyers planning to hold until Friday can buy discounted "when issued" (formerly preferred exchange) shares on the open market rather than the common shares.  They will likely convert to common shares by Friday.  As of 12 p.m. eastern, vol...

Citigroup Shares Rise After Share Collapse in Japan -07/13/09 at 9:45 AM CDTby Peter York

Citigroup Inc. (C) shares in Tokyo had fallen over 6% last night, with the Nikkei index down 2.55%.  It looks like Japanese Citigroup traders may have overreacted. This morning, despite an analyst earnings warning, Citigroup shares are up around 3%, suggesting that Tokyo's light trading of Citigroup had little impact on United States trading.  C...

Bank Of America Corp's Preferred Trusts Continue to Trade at Irration... -03/04/09 at 10:21 PM CSTby Perry Rod

In my first installment of this issue on February 20th, I highlighted an unusually enormous spread between the yields of nearly identical Merrill Lynch and Bank of America preferred trusts.  In particular, MER-C on that Friday closed with a yield of 26.79% while BAC-U closed with a yield of 15.58%.  It turns out that on that parti...

An In Depth Look Into Bank Of America Corp Preferred Trusts And Their... -02/21/09 at 5:07 PM CSTby Perry Rod

In my last installment, I showed that Bank Of America (NYSE: BAC) preferred trusts are trading at yields that are completely arbitrary when compared to their own nearly identical trusts.  I further pointed out that the Merrill Lynch Trusts, which are basically the same trusts with the exact same terms, trade at an even greater discrepancy. Let's get...

Bank Of America Preferred Stocks Trading At Dramatically Different Yi... -02/20/09 at 5:37 PM CSTby Perry Rod

Only in unprecedented times like these will you ever see the following situation.  Merrill Lynch Trust Preferred stock (stock symbols MER-D, MER-E, MER-F, MER-K, MER-P, MER-U) closed on Friday with an average yield of over 26%, while the virtually identical and better known Bank of America Trust Preferred stock (stock symbols BAC-B, BAC-C, BAC-U, BAC...

The United States Oil Fund: A Way to Short The Market? -02/19/09 at 6:34 PM CSTby Reggie Abaca

With fewer people working in the United States, fewer people have been driving.  It had been assumed that this would cause a new trend of falling consumption of oil, as was the case in the early 1980's.  But hold on there.  Oil prices shot up on Thursday after government data showed that oil inventories unexpectedly fell and consumption may...