It's All About Appearances

As time goes on I've come to realize that what I once thought was my absolute grasp on the secrets of the Universe were just a prelude to the growing realization that I understand nothing.

Nothing at all.

What I'm also realizing is that during that period of your life when you are on the path of professional ascendancy or at least hoping to be on that path it's not about substance at all.

It's always about appearances. The appearance of substance is priceless.

Which essentially means that the world is divided into just two camps.

Those that are truly capable and those that aren't, but may look good as they feign their way through the system and up the ladder.

For purposes of maintaining a dichotomy, I conveniently overlook those that are in no way capable, nor ever perceived as being capable.

I suppose that there could also be those that had been fully capable but got thrown to the curb as societ and technology passed them by.

Reserch in Motion seems to fall into that last category.

Just a few short days ago, after ridiculing the Research in Motion CEO's performance on the evening of the earnings report that missed analyst's estimates of $0.80 by 7/10's of a cent, the shares recovered from their immediate plunge and actually closed the quarter, which happened to be the very next day, up $1.

It doesn't matter whether you're dealing with a $14 stock or a $600 holding, but a 7% move is a big deal, just as apparently a 0.875% miss in earnings estimates turns out to be and then doesn't

I don't own shares of RIMM, but I have to wonder how in the second day of the new quarter it could be back down to a point that it's now trading 5% below its weekly low, which was already pretty low.

Did anything change?

Click to read more ...

The Day After

There have been countless stories, books and movies written about the day and days after events that wiped out the world, leaving behind only a few hardy survivors. or perhaps none at all.

"Aftermath" tales are popular and filled with fantasy of how the human race rebuilds itself after unspeakable disaster.

For all we know, our world has already had such disasters. Ice ages, meteor strikes come to mind., but the human race, if present during those times, had much less to lose and certainly much less of a hurdle to climb to return to its previous state.

It's one thing to survive Armegeddon without having access to your vital cave drawing tools, but it's a whole different situation if you don't have access to your 4G and no place to plug your iPad recharger.

Much less is written about the aftermath of wonderful things happening.

Once you get to paradise can you really get to a better place than that? No one fantasizes about how much better things would be if only there was a 73rd virgin.

It would probably be fairly depressing to write about how banal existence becomes when there's no likelihood of improvement.

We were all pretty ecstatic when news of Osama bin Laden's death was reported, but how long did that last?

And sure, it was like a little bit of heaven on earth when the polling indicated that Tim Tebow was a better choice than Tom Brady for the new Jockey underwear ad campaign, but the joy was fleeting.

I'm not one much to dwell on "half lives," but there's probably a strong correlation between the half life of an event's aftermath and the need to portray it to others.

The half life of a nuclear glow off the horizon is probably longer than the giddiness over the announcement of a dividend.

So today, in the immediate aftermath of Apple's dividend announcement it shouldn't come as too much of a surprise that it's completely forgottten news.

Time to move on.

Click to read more ...

Apple Embraces Chinese Communism

We all know that corporations are people. The United States Supreme Court made that abundantly clear and the equally abundant political ads, courtesy of the Super-PACS are testament to the privilege of being a person.

Best of all, the beneficiaries of corporate largesse can wash their hands of all responsibility, as they must have an arm's length relationship with their friend, the Super-PAC.

It's so nice to be able to keep a straight face while totally disowning some egregious allegation or claim.

It may not seem as if its a privilege to be a viewer, but someone has to pay the price for someone else to have rights.

Apple is a person among persons. WIth a market capitilization is large as it is, it definitely warrants attention when it does anything.

Today it shook the ground enough to even get the attention of its co-founder, Steve Jobs.

The singular issue of the day was the Apple decision to offer a meaningful dividend and purchase back some $10 Billion in shares, which at its current rate of climb would be about 12 shares.

The certainly not something that Mao Tse Tung or his successor Mao Zedong, would have done in his lifetime.

In fact, the announced dividend, if paid in $1 bills that were laid end to end would circle the globe six times. If paid in Chinese Yuan it would also circle the globe sx times, but only because the size of their note is artificially pegged to our dollar's dimensions.

The truly amazing thing is that if you followed that trail of singles around the globe again and again, you'd likely never run into a single Research in Motion Playbook owner.

That fantasized fact may be somehow related to Apple's incredible recent success.

But how do you deal with such success, especially when the underlings get restless?

Just thrown a curveball, Apple has emerged unscathed as it turns out that the Chinese FOXConn controversy may have also been a fantasy. Apple has never been accustomed to being scrutinized or criticized.

In size, impact and imperiality, Apple is China.

Click to read more ...

Weekend Update

If I do say so myself, the nice thing about my blog is that you really don't have to read it very often, because I'm constantly repeating myself. Imagine being married to me. Suddenly the unlimited supply of amusing stories and anecdotes reaches a limit, as long as your memory or hearing is intact

Best of all, this still being a free society, you don't have to read it at all, as long as you continue to pay the monthly subscription fee to have it delivered to your Kindle.

Imagine, just $0.99 a month to have it electronically delivered to your e-Book reader.

I think Amazon should adopt the old Telephone directory strategy for having an unlisted number and charge $2.50 a month to not get the blog delivered to your Kindle.

But if you have been reading on a regular basis you'd know that I've been bemoaning the fact that so far in 2012, I've been trailing the S&P 500.

Ever since I've been doing this dogmatic approach to covered call writing I'm not accustomed to seeing myself behind the eight ball.

The real kiss of death probably came when Barrons Magazine called the covered call strategy the only winning one for 2011.

It's exactly the same as when TIME magazine puts something hot on the cover.

It fades and fizzles.

Or like when Sugar Momma finally got herself an iPod Mini.

The day that she gives up her Kindle and exchanges it for an iPad is the day I start shorting Apple shares with every last bit of my soul and portfolio.

But finally, this week was back to normal, though not in trading activity. I still made relatively few trades this week. Having made such few trades, some dumb ones, in hindsight, really stand out.

Like grabbing a few pennies by selling calls on all of my Research in Motion holdings on Thursday, the day before shares inexplicably go up 7%.

I say inexplicably, because the purported reason was first given that there was some sort of Samsung alliance rumor, which was then followed by the contention that the fact that RIMM didn't offer a "profit warning" report had to be a very positive sign.

I don't know very much about SEC rules, and by that I mean that I don't know anything, but are they required to give profit warnings?

Click to read more ...

Seven Deadly Sins (Archives)

This is a re-print of a blog posting that appeared in the original Szelhamos Rules blog that ran for precisely 1 year from 2007-8 and was dedicated to the memory of my father, who was a Holocaust survivor. The original title was "Aren't Rumors Great?" and appeared on October 24, 2007. It is reprinted this evening following Jim Cramer's mention of the "7 Deadly Sins" during the broadcast of his 7th Anniversary celebration of Mad Money.

Many more, Jim. Let's make it to at least 14 deadly sins.

I don’t really remember what the seven deadly sins are. I think that rumor mongering is among them, but I’m really not sure. That ugly looking person over there, the one that I saw sneaking out of the crack house told me that it was one of the seven deadlies. But would you really trust someone who strangles kittens? Maybe you might elect them president. You know who I’m talking about, but you wouldn’t want to trust them.

Maybe rumor mongering doesn’t rank up there with gluttony, lust, avarice, Sleepy, Dopey and Doc, but it should.

Today, though, it was a rumor that turned everything around.

Maybe, in hindsight, rumor mongering should be counted among the seven holy virtues. Because, really, is humility that great of a virtue? Couldn’t we just lose humility? There should be some kind of a rotation of both virtues and sins. There just has to be a way to make room for a good rumor.

But I do like rumor mongering. It can easily go both ways. You have to love that kind of versatility. The last time we had that kind of versatility, football players were still wearing leather helmets.

But today, it was obvious that rumor mongering must be a virtue. How else would you categorize something that turns the market around from a 200 point loss? It has to be a virtue. There’s certainly nothing virtuous about a 200 point loss.

The day really started off badly. Merrill Lynch, which just 2 weeks ago announced that it would take $5 billion in sub-prime and bad loan losses came out with their earnings this morning. Funny thing, that in the past 2 weeks they were able to find another $3 billion in losses.

They just didn’t see it coming, I guess.

Click to read more ...

At a Loss

It's around 2 PM on Thursday, but for me the trading week has pretty much come to an end and I stand defeated.

Actually, I lounge defeated. It's really the same thing, just more comfortable and can be sustained for longer periods of time.

As I look back at the week I'm at a loss to explain or to rationalize my continued state of existence. If I don't trade, what am I?

The alternative is frightening and brings back memories of the classic TV character, Maynard G. Krebs," when faced with the possibility of having to do something gainful to support his "footprint."

"Work!"

Bob Denver's character's response to the very possibility of having to work was pretty unrealistic as there was really no evidence that he had ever worked before. Of course I know that sounds like someone's mother using the "how do you know that you don't like liver if you've never tried it," but who knows, Maynard may have liked working.

I like lounging.

Tomorrow will be one of those infrequent days that I will be doing something reasonably constructive and venture more than a few feet from my La-Z-Boy perch. As with most of these days, they were planned a couple of months ago and do contribute to that flickering portion of my ego that still requires self-esteem.

Oh, and they pay well, too.

It's just coincidental that it comes at a week when I've done essentially nothing to advance the argument that I deserve to be perched. Imagine that if your prized talking parakeet stopped talking. I'd probably feed that sucker to our dachshund, Laszlo, who would be so totally self-actualized if only he could get a bird between his jaws.

If I can't do my tricks, what reason is there to keep me going and supplied with a freshly lined cage?I had been hoping to keep doing this even beyond the point that they'll have to start lining my La-Z-Boy.

Click to read more ...

Law of Large Numbers

It seems that as everyone is all a buzz about Apple, the nay-sayers are beginning to pop up.

Again.

Most recently, the nay-sayers were prepared to pocket their profits after Apple disappointed those expecting an announcement of a dividend or stock split.

The funny thing is that the "buy on the rumor and sell on the news" kind of thing never happened.

It's sort of maddening when the script isn't followed and the Talking Heads are left out to dry and quickly disavow their admission of shorting shares. Although to be fair, there were plenty of Apple bulls to be found, as well.

Ordinarily, any company climbing as much, and as rapidly as Apple has in recent months, would have sold off on the realization of good news and would most definitely have plummeted on the news not having been realized.

Instead, there was no reason for Steve Jobs to roll over. The kids he left to take care of the place didn't trash it at the very first opportunity. It's almost as if they actually cared about their legacy.

No dividend, no split, no Flash.

Among his other positve attributes, you probably have to add "respect for the sacred" to Tim Cook's list.

But the re-appearance of the nay-sayers is only natural.

They popped up briefly when the iPhone 5 failed to appear, but still, it's easy to understand why being a nay-sayer is so appealing.

No one remembers the guy who climbed aboard the moving train, but everyone remembers the guy that decided to take the train when it was  subsequently learned that the plane he was supposed to take ended up crashing.

That guy was a genius.

With excitement growing about some kind of iPad product release, shares have moved up to another all-time high. It seems that latter part of the preceding sentence could have been said any number of times since I lost my Apple shares to assignment at $425 not that long ago.

Now, every cynic is citing "The Law of Large Numbers" as a reason to be wary of investing in Apple.

As anyone knows, investors pay for future growth. Also, as anyone knows, according to Woody Allen, an investment is like a shark, in that it has to "constantly move forward, or it dies."

I try not to burden myself with knowledge or accepted wisdom and I don't mind distorting quotes or taking them way out of context.

I do like to wait for the next train though, rather than trying to catch a speeding one that's already left the track.

For me, Apple has left the track, but I also think that the shark will soon stop moving, but certainly not to the point of death. It will still be menacing to others by virtue of its size and reputation and occasional demonstrations of past glory.

Click to read more ...

Natural Gas and Cash Hordes

Thanks to the kindess of strangers, blogging goes uninterrupted, as Tony Vahl has come to my rescue. Tony is a serial blogger and the author of the off-beat Dream Seeker book series. 

His own highly regarded site, The Daily Skew, is now also available for monthly subscription on the Kindle. Today's guest blog marks his second for me, as I am currently under general anesthesia, in recovery, dead or recuperating at home.

Maybe all three, if I hedged properly.

Seeing that my last post here did not result in the death of the lowly regarded TheAcsMan blog, I decided to come back and share two things I learned this week while listening to Bloomberg Radio and reading a Seeking Alpha missive. 

To make this post a little more relevant to the legion of TheAcsMan blog readers (all 39 of you), I will go ahead and compare what I learned with what George has said about the topic in the past.  Okay, so what did I learn this week listening to Bloomberg?  Here goes:

1. The United States has a twenty year competitive edge on the rest of the world when it comes to Natural Gas resources

I know there's a flatulence joke in here somewhere, but I'm going to leave that alone.  I'm reminded of the scene in Star Wars where the Storm Trooper says, "It's just a gas tick," on the closed captioning. A co-worker once swore to me the Trooper actually said, "I'm just a little gassy," as Obi-Wan scampered off.

Anyway, a few Talking Heads this week talked about how demand for oil is leveling off, how the US will be a net exporter of oil in 20 years, and how auto makers are eager to offer natural gas-fueled vehicles to consumers, even with an option to go back to regular 87 octane at the flip of a switch. 

So, tell Clint Eastwood the U.S. has the advantage in the second half, as we enter into the post-Madonna era.

Click to read more ...

I'm mit Mitt

I'm mit Mitt.

No, not politically, but I just like the sound of the not quite palindromic expression that uses the comedic flavor of the Germanic language family to play off of an unlikely name of a Presidential candidate.

"I'm mit Mitt."

Now that's funny and has tested off the charts with the Bavarian demographic in the Little Naziland neighborhood, that sits uncharted, just outside of Boise.

But unless CNN was being sarcastic, we are doomed as a culture, hearing them describe Mitt Romney as the "stand-up comedian" within the group of this years' Republican Presidential hopefuls. Whereas we're all used to seeing Anderson Cooper giggling like a middle school aged girl, you rarely see Candy Crowley lose it and give away the joke.

So we'll never know whether they were serious about Romney's comedic skills and talents.

I'm going to vote for "sarcastic" as the tone of that  description of Romney. He's had lots of time over the past couple of decades to establish the "lighter side of Mitt." I don't think anyone can blame the left leaning media for shielding the American public from that view of Romney, the man.

What is it with Massachusetts politicians that have national political aspirations? Why can't they return to the days when a Massachusetts bred President could casually bed a teenage intern and still be lovable, funny and charming?

All while steering the world through a showdown with Armageddon

Click to read more ...

Too Zune for a Requiem?

And so as all of the talk centered around how Apple had suddenly and significantly reversed its upward stock price march the "Talking Heads" were begining to swoop down on the carrion.

There were lines drawn.

Figurative ones for certain, but also the literal lines drawn by the technicians with well coiffed hair and highly tailored suits.

Then there was omenous talk about the meaning of the decreasing stock price in the face of heavily rising volume.

All scary concepts.

To me, no one will every be able to explain in purely technical or fundamental terms how a stock price can so abruptly change direction in the absence of news. For the die-hard technicians, there will certainly be someone to point out some line crossed or not crossed and use that as an explanation for Apple's reversal.

Was some decree passed that I missed? Can people no longer liste to music or talk on cell phones?

50 Day Moving Averages. 200 Day Moving Averages. There is not shortage of examples to demonstrate points that are screaming to be made.

To those, I ask if they've ever heard of the concepts of "sensitivity' or "specificity?" How about "false positives and false negatives?" Have they never heard of "The Zune?"

A couple of generations ago a deservedly disrespected past President spoke of the "silent majority." I think that in the world of stock charts the silent majority are those that don't behave quite as predictably as a technician would have anyone bothering to listen, believe.

No one is ever going to show you the charts where the stock prices didn't move as the technicals predicted that they should.

More than one Talking Head mentioned how no one was daring to mention how that if Apple floundered it would take the rest of the market with it.

Obviously, they don't listen to one another and based on their ability to revise the past, they probably don't listen to themselves.

Click to read more ...