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The Day Ahead: The Hannibal Lecter Investing Toolkit

Hannibal Lecter, of The Silence of the Lambs fame, had a portfolio of rather intriguing, if not outright frightening, personal traits. They included a calm, yet calculating voice, a strange mask when locked behind bars and internal anger that was harnessed to unleash horrific, premeditated crimes. Leaving aside the "horrific, premeditated crimes" bit, let's use that inner anger as inspiration in our investing.

Allow me to explain: I have found that a wicked combination of anger and passion are great tools to be used to achieve success. The key here is flipping the switch so that both of these flow through the spout at the same moment. There are valid reasons to be angry right now, as openings bells for the past two weeks have been akin to an open door to slow torture. For instance, we saw a jobless claims surpass a number based on the same forecast models that these folks were all taught at the tender post-college age range of 21 to 25 -- except this was seemingly not to be believed.

Then there's Fastenal (FAST - Get Report), in which faint hope was spotted as the stock sprinted into the field of green grass on the philosophy of, "Hey, man, it could have been worse." Hmm. Well, that is true, but when you chainsaw into the company's ridiculously detailed earnings report, you find that the modest monthly September revenue acceleration -- cheered by the market -- was rooted in a favorable year-earlier comparison. Comparisons in the fourth quarter revert back to difficult, and Fastenal saw it fit to drop these clues that a Word search won't uncover:

  • The run rate of sales is not maintaining its normal seasonal pattern.
  • Selling prices are weakening -- and I do not believe this is solely due to currency fluctuations.
  • Don't even get me started on the domestic and global macroeconomic messages behind Dollar Tree (DLTR - Get Report) sounding the alarm bell on sales and earnings, or AMD (AMD - Get Report) joining the list of "massive" earnings warnings that I have indicated in recent weeks. Meanwhile, Burberry's stock moved higher on a meager 1% improvement in same-store sales -- to 1% growth -- from Sept. 11, while warning that middle-income consumers were shopping less frequently. (I never was a fan of Burberry Brit.)

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