The Mad Hedge Fund Trader-Thursday
Global Market Comments
January 28, 2010
Featured Trades: (SOUTH KOREA), (EWY), WON),
(TIGERS), (LEMURS), (HEDGE FUND RADIO)
QUOTE OF THE DAY
“Cash bonuses on Wall Street are going to become a dinosaur,” said Jon Corzine, governor of New Jersey, and former chairman of Goldman Sachs.
This is not a solicitation to buy or sell securities
For full disclosures click here
The "Diary of a Mad Hedge Fund Trader"(TM) and the "Mad Hedge Fund Trader" (TM) are protected by the United States Patent and Trademark Office
The "Diary of the Mad Hedge Fund Trader" (C) is protected by the United States Copyright Office
January 28, 2010
Featured Trades: (SOUTH KOREA), (EWY), WON),
(TIGERS), (LEMURS), (HEDGE FUND RADIO)
1) I have been banging on about South
Korea (EWY) for some time now as the “K” that should be in “BRICK”, the
country that has successfully carved out a niche between the rock and
the hard place, China and Japan, yada, yada, yada. Click here
for my last piece on the Hermit Kingdom. So when the recent Vice
Minister of Finance for the ROK passed through town, I leapt at the
opportunity to have dinner. The wrenching, soul searching rebuilding
and reregulation of the financial system the US is suffering now, South
Korea went through during the Asian financial crisis in 1998. That
meant Korean banks entered the recent meltdown with less leverage,
better balance sheets, and a healthier consumer loan book than its
American counterparts. These institutions have non performing loan
ratios to kill for. The happy dividend was a classic “V” shaped
recovery last year, it’s GDP hand springing from a -5% rate to a +4.5%
in a matter of months. That enabled the KOSPI, the main Korean stock
index, to outperform China’s, bringing in a 57% return in 2009, no mean
feat. An export led recovery boosted the current account surplus,
suddenly transforming the Won into a hard currency. This stellar
performance gained Korea membership into the exclusive G-20 club of
industrial nations. Korea is now pursuing a clever export strategy by
climbing up the value chain from below and getting American and
European consumers to replace more expensive Japanese and German cars
with KIA’s and Hyundai’s, which deliver the same quality for half the
price. There are challenges longer term. Korea has to win the race to
develop a service economy while its larger neighbors are still over
reliant on manufacturing. Think medical tourism a la Bangkok and New
Delhi. It also has the world’s lowest birth rate, which at 1.19, is far
below the replacement rate of 2.2. Seoul is the easiest major city in
the world to flag a taxi, drivers outnumbering New York by 7:1 on a per
capita basis, as this is a traditional parking palace for the
unemployed. As I know you are all astute followers of demography,
you’ll immediately grasp that fewer babies today mean a dearth of
consumers in 20 years. The only downside of the dinner for me was that
after gulping down huge quantities of garlic soaked kimchee, my social
life was put on an indefinite hold.
2) In case you missed it, the second hand animal market has crashed. Forced to slash budgets by cash starved municipalities, the nation’s public zoos have been paring back their collections of living exhibits. The Washington Zoo is trying to offload a 7,000 pound hippopotamus; while the San Francisco Zoo is short some tigers after one ate a visitor and had to be shot. The Portland Zoo was able to liquidate a portfolio of lemurs only because of the popularity of the recent DreamWorks’ “Madagascar 2” animated film. When zoos are forced to economize, they downsize the big eaters first to save on feed costs; hence, the absence of elephants in San Francisco (Could this be a political gesture?). In fact, zoo staff were recently busted for illegally harvesting acacia on private property, a favorite of giraffes, which grows wild here after its introduction a century ago. The hardest to move? Baltimore has been trying to sell its snake collection for two years now. Talk about an illiquid market. Maybe they should try AIG. Snake derivatives anyone?
3) My guest on Hedge Fund Radio this week is Andrew Horowitz, president and founder of Fort Lauderdale, Florida based Horowitz & Company. Andrew is a registered investment advisor, blogger, and podcaster extraordinaire. He has built one of the most sophisticated investment websites on the Internet, and his podcasts, 145 of which have been posted so far, and are rated among the “Top Ten iTunes”. Andrew uses a blended investment approach called “QuantaFundaTechna” which combines stocks, mutual funds, ETF’s, and options to deliver investment returns. In 2007, Andy has published a book about his approach called The Disciplined Investor-Essential Strategies for Success. Andrew also writes for AOL Finance and MSN Money. You can learn more about Andrew Horowitz by visiting his website at www.thedisciplinedinvestor.com.
Hedge Fund Radio is broadcast every Saturday morning at 12:00 pm Eastern time, 11:00 am Central time, 9:00 am Pacific Coast Time, and 5:00 pm Greenwich Mean Time. For the online link to the live show, please go to www.bizradio.com , click on “Listen Live!”, and click on “Houston 1180 AM KGOL.” For archives of past Hedge Fund Radio shows, please go to my website by clicking here at www.madhedgefundtrader.biz .
2) In case you missed it, the second hand animal market has crashed. Forced to slash budgets by cash starved municipalities, the nation’s public zoos have been paring back their collections of living exhibits. The Washington Zoo is trying to offload a 7,000 pound hippopotamus; while the San Francisco Zoo is short some tigers after one ate a visitor and had to be shot. The Portland Zoo was able to liquidate a portfolio of lemurs only because of the popularity of the recent DreamWorks’ “Madagascar 2” animated film. When zoos are forced to economize, they downsize the big eaters first to save on feed costs; hence, the absence of elephants in San Francisco (Could this be a political gesture?). In fact, zoo staff were recently busted for illegally harvesting acacia on private property, a favorite of giraffes, which grows wild here after its introduction a century ago. The hardest to move? Baltimore has been trying to sell its snake collection for two years now. Talk about an illiquid market. Maybe they should try AIG. Snake derivatives anyone?
3) My guest on Hedge Fund Radio this week is Andrew Horowitz, president and founder of Fort Lauderdale, Florida based Horowitz & Company. Andrew is a registered investment advisor, blogger, and podcaster extraordinaire. He has built one of the most sophisticated investment websites on the Internet, and his podcasts, 145 of which have been posted so far, and are rated among the “Top Ten iTunes”. Andrew uses a blended investment approach called “QuantaFundaTechna” which combines stocks, mutual funds, ETF’s, and options to deliver investment returns. In 2007, Andy has published a book about his approach called The Disciplined Investor-Essential Strategies for Success. Andrew also writes for AOL Finance and MSN Money. You can learn more about Andrew Horowitz by visiting his website at www.thedisciplinedinvestor.com.
Hedge Fund Radio is broadcast every Saturday morning at 12:00 pm Eastern time, 11:00 am Central time, 9:00 am Pacific Coast Time, and 5:00 pm Greenwich Mean Time. For the online link to the live show, please go to www.bizradio.com , click on “Listen Live!”, and click on “Houston 1180 AM KGOL.” For archives of past Hedge Fund Radio shows, please go to my website by clicking here at www.madhedgefundtrader.biz .
QUOTE OF THE DAY
“Cash bonuses on Wall Street are going to become a dinosaur,” said Jon Corzine, governor of New Jersey, and former chairman of Goldman Sachs.
This is not a solicitation to buy or sell securities
For full disclosures click here
The "Diary of a Mad Hedge Fund Trader"(TM) and the "Mad Hedge Fund Trader" (TM) are protected by the United States Patent and Trademark Office
The "Diary of the Mad Hedge Fund Trader" (C) is protected by the United States Copyright Office
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