Thursday, December 13, 2007

Playtime is Over

Put the Nintendo controller down. Your fantasy football team has been eliminated. The writers are still on strike, so it's reruns again.

Every day you wake up with a chance to do something to make your life better. Did you make a list of things to do for today? Mine's sitting right next to me, and I'm crossing off #5 as I write this.

I'm far from an investment professional. What I know about the market I know from reading tons of stuff, from Value Line reports to Lynch to Dreman to Greenblatt, and from having the nuts to put my money down. I know enough to pay attention to the things around me. When I filled a prescription 5 years ago, my plan was with Advance PCS. What the hell is that? Turns out, it was a PBM, a pharmacy benefits management company, a middleman between the drugmakers and companies who negotiate prices. Sounded good, and 2 years later I had quadrupled my investment as Caremark bought them out. Turns out, Caremark would later be bought out by CVS, bringing even more money to the table.

I live in South Florida. I bought a house here 3 years ago. I was offered every ARM and alternative loan imaginable by guess who, Countrywide! So when their CEO said last year that those loans were not being offered by his company, I knew he was simply lying and badness was to come. I shorted Countrywide in the high 30s, nice!

Getting over to gambling... I mean, what else can you call investing when you're simply taking educated guesses at whether a company's value will go up or down (dividends hardly justify the arguments)? Neither am I a gambling professional. I can count 8 decks of cards and have used this skill to make some money. I've won betting football games the last 4 years (Super Bowl last 6). With that said, if you bet more than a few bucks on a game, you probably can't afford it. If your bets have 4 figures I'm sure that you can't afford it. But, gambling is lots of fun, so I'm gonna talk about it here.

Let's get started.

Investment of the Day: XLF
What is it? Banking Index
What to do? Bet against it, LEAP or short, but bet against it
Do I own it? Of course I do, silly! I bought the Jan 09' 39s, watching it fall as we "speak"

Bet of the Day: Florida against Michigan in The Capital One Bowl, -10
Why? Bet what you know. Living in Florida and watching the Gators' spread offense score gazillions of points every week, I'm sure that they can beat this coachless team that lost to Appy State.

Your Task of the Day: Call the investment relations department of a stock you own and ask them why the hell you shouldn't sell them in today's market.
Why: Once, when debating between buying Best Buy and Circuit City, I called CC and got some brutal honesty. They basically said, sure, we're a crappy company with little hope of ever reproducing BB's results, but hey, we're $4 with a ton of cash! We have nowhere to go but up. They were right, CC later topped $20 (damn, missed that one!)

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