Friday, March 27, 2009

Sold AINV and DDT/UBS on DD

Dimon told reporters that business turned a little tougher in March. 

That one statement caused at least 1/2 of the decline today 

I went ahead and sold the 50 AINV bought in the IRA at 2.35 earlier this month at $3.50, a large percentage gain with the dividend but not much money. Buy 50 AINV at $2.35 in IRA/Revisions to top Twelve Causes of the Not So Great Depression

I could not resist the company at the price paid, but I do not have a lot of confidence in it.

I read a story in USA Today that a man was arrested for stalking Shawn Johnson. He had a loaded gun in his vehicle. In Tennessee, it will not be long before you could be arrested for not having a loaded shotgun in your vehicle. The State Senate did recently pass an amendment to the State Constitution outlawing abortions under any circumstances, including to save the life of the mother.  Memphis Commercial Appeal
Most likely, when this amendment to the state constitution clears the legislature this year, and one other term,  which is the top priority of the state's GOP and likely to happen, it will have to be submitted for a vote.  I do not have a problem with voting on that kind of issue. 

I bought a few days ago a junior debt issue of Dillard's at $5.82. This was highly speculative when I purchased it. Moody's has downgraded DDS debt further into junk This one is questionable considering the large amount of debt that is senior to this junior bond. Fortunately, the company does not face any large near term debt maturities. I went ahead and sold my 50 shares of DDT at $7.4. LB says that the risks of the junior bonds with long maturities that are falling deeper into junk is not worth the risk now.  Investments in these lower tier junk issues have to generate a better total return potential, with a shorter maturity, to justify their heightened risk of loss-DKR came to mind as an alternative. 

UBS expects DuPont's agricultural business to record 15% annual growth over the next five years and account for 50% of earnings by 2013. Stocks To Watch Today 

UBS initiated DuPont with a buy.

Dupont was one of the first stocks acquired by RB on 3/6, bought at 16.68, when it started its frolic and detour. The Most Abused Word: Reform/Buys of IR & DD/Santayana: An Inability to Remember History or Just Creating Your Own Reality to Fit an Ideology

A prior position was unloaded at over 45, but I am inclined to keep what I have bought since that last sale. AMERICAN INDUSTRY: END OF DAYS?

I suspect that the recent rally from the lows will run into some tougher resistance now. The DJIA has had a powerful rally, up 17.34% in three weeks.  Yet, it is not clear that a recovery has taken hold. At best, there are some signs of stabilization. Next week, I will concentrate on adding one or two names, possibly one pharmaceutical company and another consumer staple. The S & P closed the week at 815.94, just playing a mind game with my 815 rule. Maybe we should not have too much confidence in a rally that started with the number 666 on the S & P 500.  
The low happened intraday on March 6, 2009 at 666.79.   

I listen to what Whitney Tilson has to say.

  I am not a financial advisor but an individual investor trying to navigate my way through a difficult market. I have never worked for a financial institution and never will.  In these posts, I am acting as an unpaid financial journalist and an occasional political commentator.   I am also aggregating financial news stories that I view as important and providing any reader of these posts, assuming there are more than a couple, with links to those articles, sort of a filtered, somewhat intelligent, free search engine.  Any discussion made by me of particular securities  is not a recommendation to buy or to sell.  Trade at your own risk.  Consult with your financial advisor prior to making any purchase or sale. I will try to identify my sales too but it may take a few minutes after I implement them to create a post explaining my reasons.  The sale may before or after the post.  Before buying or selling any stock, even one recommended by a trusted financial advisor,  please research it and make up your own mind which is what I always try to do.  Research would include reading reports, reviewing financial records, earnings estimates, sec filings and prior earnings releases and news.  In this post, and all others by me, I am merely describing my reasons for purchasing  or selling securities, and the potential pitfalls that I identified prior to purchase or the reasons for a sale.  The securities mentioned in this and all posts written by me may not be suitable for others based on their unique financial position and risk profile.  By way of example, it is unlikely that I will ever need the funds contained in my retirement accounts. Always read the prospectus before buying a Trust Certificate, bond, preferred stock or other bond or bond like investments.  Information contained in my posts has been obtained from sources believed to be reliable but cannot be guaranteed.  These posts by me do not constitute investment advice, nor shall they be construed as a guarantee of future results, or as an offer of any transaction in securities.   All content in these posts is provided for informational and entertainment purposes only, and it is a form of entertainment for me. 

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