that's gonna leave a mark

snapshot of the trend-breaking DJIA in late afternoon trading

chart courtesy of bigcharts.com

vacation

the week that was...did we miss anything important? Not really. The usual stuff about options backdating, Steve Schwarzman, PE, huge mergers and acquistions, hedge fund regulation, $honey/planegate, and other topics that are grabbing the financial news headlines. The markets continue to trend lazily upwards (sometimes looking aimlessly sideways - looking like they are ripe for a bit of a sell-off)....was out of town Tuesday through Sunday...back at it today.

net worth requirements part deux

So it looks as though the SEC's little proposal about raising the minimum net worth requirements for investors is meeting a bit of a road block. Many people have voiced their opinions on why this is a bad idea.

This blog mentioned it a while back and it still rings true today. The level of sophistication differs little between the rich and the super-rich. The disparity of knowledge between even this single group of people is all over the board from the ignorant to the super-informed.

Also, nothing prevents the average Joe investor from placing his money into the single most risky investment out there: 1 single stock or a single commodity. Yet, the SEC feels it is their duty to protect the wealthy from investing their money with qualified and licensed professionals with experience. Doesn't make sense.

One final note....if the SEC wants to stop the fraud from happening, then create a list of authorized service providers. Auditors and administrators who have passed scrutiny and will not be party to fraudsters' plans to steal money.

Many if not all of the recent fraud blow-ups have been a result of the managers siphoning off funds to pay for their personal expenses and running them through service providers that were nothing more than shams that rubber-stamped the disbursements.

Step up the overall quality of service providers and the problem is eliminated.

happy weekend.

DJIA 12,767.57

NASDAQ 2,496.31

SP500 1,455.54

the first IPO

Fortress Investment Group (FIG) went public today. Opened way up from its IPO price and was rumored to be oversubscribed approximately 25 times. Closed at $31 even. The first hedge fund to go public in a US exchange. The experts are saying this is the first in a long line of HF behemoths to go public in 2007. Look for the likes of Citadel to test the equity waters soon.

An excerpt from a humorous article from Bloomberg.com by Mark Gilbert:

'Hedge Funds - You have two cows. A guy in an open-necked shirt drives up in his Bentley and offers to take care of them for you in return for a year's supply of steak and 50 percent of their milk. They won't be allowed to leave his compound for two years. Six months later, you have half a cow, producing sour milk. "You have to be willing to lose rump today to get rib-eye tomorrow,'' the hedge-fund guy mumbles through a mouthful of sirloin and champagne.'

Oh that's hilarious.

Maybe the HF manager lives here (just to add a little more fuel to the fire).

Upward trends in the 3 main indices (DJIA, Naz & SP500) that are relevent to RCA are still maintaining their upwards trends although the Naz's trend has altered its trajectory to a flatter incline.

So are the shorts going to win this epic battle? Looks like Mr. Mo may be switching teams (after a very nice head fake...)

chart courtesy of bigcharts.com

Happy Friday.

DJIA 12,580.83

NASDAQ 2,459.82

SP500 1,438.06

meeting the big fish

So this past week, I had the chance to meet and chat with Ken Fisher and also was lucky enough to get a signed copy of his latest book. He runs a little money management shop in the bay area, Fisher Investments manages about 36 billion in a variety of strategies. His dad was a big hitter, used to run around with Warren B. and made quite a name for himself in the value investing arena. Ken, the son, initially worked with his dad, then left and bounced around a few places before starting his own firm when he was 37. He has a great education, is well-published both in the "real world" and in academia. His firm was built through hard work and a ton of advertising on various websites, almost to the point that the pop-ups and banner ads got to be annoying. Anyway, as I talked with him about how he got started in the biz, I'm thinking to myself, this guy is worth over a billion dollars, he's on the Forbes 400, and he runs a very large and very successful investment firm. However, I also was thinking to myself, this guy puts his pants on one leg at a time just like everybody else. There was no magic formula or secret to his sucess...yes, he came from fine finance pedigree but he managed to build his business and create his wealth through hard work and determination. Inspiring.

Happy weekend.

DJIA 12,653.49

NASDAQ 2,475.88

SP500 1,448.39