Archives of “April 2019” month

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Warren Buffett will rely on human nature for his next big deal

  
Analysis, Education

Buffett interview in the FT

Buffett interview in the FT
A great Warren Buffett interview is available in the FT. It mostly focuses on the difficulty of growing Berkshire Hathaway because of it’s already-enormous size. He said there are only 100 companies it could buy that are big enough to make a difference.
“I think that if I was working with $1m or if Charlie [Munger, Berkshire’s vice-chair] was working with $1m, we would have no trouble earning 50 per cent a year,” he says.
In the meantime, the company has accumulated an astounding $112 billion in cash that it could easily lever for much more equity.
What’s the plan? To wait until the market runs into trouble and investors get scared.
“People get smarter but they don’t get wiser. They don’t get more emotionally stable. All the conditions for extreme overvaluation or undervaluation absolutely exist, the way they did 50 years ago. You can teach all you want to the people, you can tell them to read [Buffett mentor] Ben Graham’s book, you can send them to graduate school, but when they’re scared, they’re scared,” he said.
That’s truly the number one rule in investing but it’s also the toughest to follow. In December as markets were falling, it was the right time to buy risk assets but everywhere you turned the vast majority of analysts were frightened and it’s very tough to stand alone against a fearful crowd.

Indices end the session mixed. Nasdaq up. S&P flat. Dow down.

  
Analysis, US Market

Nasdaq closes just below record close

The US stocks are ending the session mixed.
  • The Nasdaq index closed up 16.669 points or 0.21% at 8118.68
  • The S&P closed near unchanged at 2926.17. That is down -1.08 points ro -0.04%
  • The Dow is closing lower by -134 points or-0.51% at 26462

After the close, Amazon beat by alot on EPS ($7.09 vs $4.67 est). Revenues were as expected

Intel beat on earnings by a few cents but guided lower on future revenues. The stock is down

EURUSD trades to swing low targets going back to 2017

  
Analysis, Forex

Sellers remain in control

The EURUSD sellers remain in control. The price has moved down to a low of 1.1117.  Going back to May and June 2017, there were swing lows at 1.1108 and 1.1118 before the pair started the push higher (ending up at 1.12555 in February 2018).
Sellers remain in control in the EURUSD on the daily but testing a swing area.
Staying on the daily chart, if the support lows do not hold the next target would be down at 1.1054. That is the lower trend line connecting lows going back to October 2017, August 2018, November 2018 (see green numbered circles).
Drilling to the hourly chart, in addition to the 1.1108-18 area from the daily, a lower trend line connecting recent lows cuts across at 1.1104 (and moving lower). That too should be considered as a level to get below for the trend to continue it’s run.
A topside trend line on the same chart comes in at 1.1142 (see chart below).

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US initial jobless claims 230K vs 200K estimate

  
  Analysis

Continuing claims 1655K vs 1682K estimate

Continuing claims 1655K vs 1682K estimate
The initial jobless claims missed, rising to 230K vs 200K estimate. Easter week may have played a role in faulty seasonals.
  • prior week revised to 193K vs 192K previous
  • 4 week average rose to 206K vs 201.5 last week
  • continuing claims 1655K vs 1682K estimate
  • prior week was revised to 1654K vs 1653K previously reported
  • The largest increases in initial claims for the week ending April 13 were in California (+3,202), Connecticut (+1,125), Arizona (+819), Texas (+775), and Washington (+640),
  • The largest decreases were in Tennessee (-2,154), Illinois (-1,148), Michigan (-1,103), Arkansas (-799), and Ohio (-776).
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