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The Zuckerberg Interview Bounce 9.12.2012

Zuckerberg called the stock performance these past few months “disappointing”, and admitted that the drop in the stock price didn’t particularly help employee morale at the company. He did note, however, that morale wasn’t as bad as people might think, and that Facebook takes huge steps to reward its employees. Interestingly, Zuckerberg also said he enjoys being an underdog in the eyes of Wall Street, and stated, “The first half of the year was a little bit slow on products, but the next nine months I think there will be a lot of exciting stuff.”

Shares of Facebook were up 3.5% in after-hours trading following the speech. He looked comfortable as he answered questions, and for the first time he came out and said that Facebook does care about its shareholders. The highlight of his speech was his steadfast focus on the mobile space. He said the word mobile 34 times in a 32 minute speech. Zuckerberg said he expects advertising revenue to regain momentum, and that he ultimately expects mobile ads to generate higher revenue than desktop ads. As Facebook traffic occurs more and more on mobile devices, generating revenue in the mobile space will be key to progressing the stock price.

Finally, Zuckerberg pointed out that Facebook was not interested in building a smartphone, which has been a recurring rumor over the last year.

In his eyes, the future of the company remains bright, and time will tell if he can answer his skeptics and reverse the downtrend in the stock price.

Brandon Kieltyka is currently an undergraduate studying Finance at Daytona State College.

Twitter: @kieltyka05

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Morning Rage 9.12.2012

Metals are also gaining some ground this morning. Gold futures are up 10.00 points, (0.58%) to 1744.90, and Platinum futures are up 36.00 points, 2.24%, to 1643.00. Brent crude oil for October delivery is at its highest close since August 16th on speculation of a euro zone bailout.

The MBA Purchases Applications, a Mortgage Banker’s Association compilation of various mortgage loan indexes, was released today. The report is released weekly on Wednesdays, and provides a gauge of the demand and momentum for housing. Actual growth rates in the composite index was 11.1%, a change from -2.5%, an 8% change in the purchasing index and a 12% change in the refinance index.

The Home Depot, Inc. (HD | 56.72 [-0.58]) was down a half of a dollar yesterday, but rose in after hours trading a tenth of a dollar. The stock could gain on news from the Mortgage Banker’s Association. The stock is chasing it’s all-time high that hasn’t been since 1999, around 65$. The stock is currently sitting at its 52-week high with the low of 31.03 not seen since last September.

Lowe’s Companies, Inc. (LOW | 28.60 [-.09]) stock was down a tenth of a dollar yesterday, and rose by a nickel in after hours trading. LOW is also peaking towards its highest price ever before the financial crisis around $35. The stock is also bearings it’s 52 week high of 32.29, the lowest 52 week price at 18.53 also not seen since last September. LOW has not steadily risen as HD, but saw a dip in the summer months of 2012.

Apple, Inc. (AAPL) and Facebook (FB) are both up in after hours trading, AAPL releasing its new phone today and Facebook’s CEO, Zuckerberg, reassuring investors that Facebook will continue to dominate social media through mobile devices.

Alex Kalish has a masters degree in economics from Suffolk University.

Suggestions and comments welcome: alexk@keeneonthemarket.com

Screen Shot 2012-09-12 at 11.09.46 AM 

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Market Recap 9.11.2012

Metal futures and crude oil futures were mostly flat all day with gold up about 3 points and crude up less than half of a point. Natural gas gained 6.61%.

AIG ($33.03 | – 0.81%) had the highest volume of the day trading 217 million shares. Today’s volume is a result of the US Treasury selling off its stake in AIG reducing their stake from 53% to 16%. The Treasury gained $15 billion in profits from the sale of AIG stock. AIG has been trading between 30 and 35 since mid-August. 

Since the poor report on jobless claims last week and drop in exports in the international report this morning, speculation about a QE3 has increased. An asset purchase could improve exports by reducing the value of the US dollar. 

Important news besides Apple’s (AAPL | 660.59 [-2.15]) iPhone 5 debut tomorrow (possibly available for purchase by September 21st) is Facebook (FB | 19.43 [+0.52]) CEO will speak publicly since the IPO debacle. Facebook has continued its climb up the fourth day in a row hitting prices it hasn’t seen since August 24th.

Texas Instruments Inc. (TXN) announced second-quarter revenue of $3.34 billion, net income of $446 million and earnings per share of 38 cents. The stock stayed even today, slightly down $0.09, but the after-hours announcement caused the stock to surge $0.39 in after hours trading. TXN 52 week low and high is 25.60 -34.24 respectively. 

Some big economic events this Thursday include Jobless claims, Produce Price Index, and Bernanke’s Press Conference. 

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Halftime Report 9.11.2012

  Chinese Premier Wen Jiabao has announced that China will indeed meet their growth target for the year.  Markets have long been concern over slowing growth in China.  The German Constitutional Court has also announced that their ruling on the European bailout fund will be announced tomorrow. 

 The FOMC meeting is scheduled to begin tomorrow with forecasts scheduled to be released on Thursday. Bernanke’s press conference is also scheduled for Thursday.  Many analysts expect that the Federal Reserve Bank will launch a third round of quantitative easing, but there is still some skepticism over whether or not Bernanke will have enough votes to push the program through.

Moody’s has announced that they may downgrade the U.S. government’s credit rating if they cannot lower the nation’s debt ratio in the upcoming budget negotiations.

Indicies are up with the Nasdaq and S&P 500 both up around 6 points each. 

James Ramelli B.S. in Finance from UIUC. Email: james@keeneonthemarket.com Follow: @Jim_KOTM

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All That Glitters… 9.11.2012

 Whether or not the Fed announces QE3 or not they will continue to ease as they have been for years now so the announcement really doesn’t matter a whole lot unless they announce a huge new program.

 ….Is Gold

 Regardless of what the Fed announces Gold is going to go higher.  It will go a lot higher eventually.  There may be some bumps in the road, some pullbacks, but eventually gold will be a lot higher than it is today.

 I don’t know if it will be next month, next year, or in five years, but the world’s current monetary policy will send gold to at least $3000 an ounce.  It would not surprise me in the least to see $5000 gold at some point in the next ten years.

 Why Gold?

 There are several reasons why gold will continue to go up but the main reason is the global debt fascination.

 United States

 The United States is in debt up to our eyeballs.  The debt is somewhere currently around sixteen trillion dollars.  If you take into account the unfunded liabilities of social programs it is estimated to be anywhere from seventy to one hundred trillion dollars.

 There is no political will to address the funding of future social promises.  One side will never agree to raise taxes and the other will never agree to cutting benefits.  We will remain at a stalemate until it is too late.

 Europe 

As our economy flounders for the next couple decades because of all our debt, the government will continue to print money in order to “stimulate” the economy.  This is what they call monetizing the debt.  We will print money to pay off our debts.

 Europe is just in the beginning stages of monetizing their debt.  The European Union is a disorganized mess so it is taking them a few years longer than it did the United States to all come together and agree to print their way out of their financial mess.

 Portugal, Ireland, Greece, Spain, Italy, and the list goes on.  It will only be a matter of time before France and Germany’s economies are affected.  Some of those countries have over twenty percent unemployment. Europe will continue to go down the path of bond buying programs in order to prop up the unstable countries.

 Gold Will Shine

 In the end gold will be where it’s at.  In order to protect your purchasing power you will need to own gold in some form or fashion whether it be through gold coins or shares in mining companies.

 I’ve owned physical gold since the $800’s and don’t plan on selling it anytime soon.  I also own plenty of gold and silver mining companies.

 Shares in the miners have risks not associated with the gold market such as labor issues, input costs, and poor management.  Right now I would say the best way to accumulate gold is through the ownership of gold coins or bars either in your physical possession or through a company with allocated storage.

Get it now before it is too late.  These folks are going to print our way into a deeper mess someday.

-Ben Hoben