Monday Jan 30, 2012
Today's WSJ has a highly negative article on Transocean RIG on page B9. The article discusses the strategy of growth thru acquisition that has led to an aging fleet of rigs. One contract was cancelled as RIG was slow to meet safety standards and some high level execs are leaving.
This is th difficulty of investing in a single company. I did not buy a large position and "RIG is up 20% from 40 to 48 since our recommendation. We will see how this impacts the trading in RIG today.
Note the article on South Carolina's pension fund on page C1. Note the graphs on page C3 which show that it is coming up short of its funding assumptions. This is precisely what caused Meredity Whitney to issue a warning about municipal bonds. So far her detractors have been correct, nothing has happened and muni bonds have rallied after selling off after her prediction. But, something has to give, states and cities cannot underfund pensions, deliver services, and keep the perks that unions in Wisconsin are demanding AND pay the muni bond holders.
Page C5 features a positive article on gold coin buying This precedes an interest in metals investing. We recommended going long GDXJ and CEF at the end of December.
And on page C8 The Euro looks for More Gains. This backs up our belief that the US Dollar will fall probably during February.
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