(Editor's note: Doug Kass has sprouted some bull horns recently, and the following excerpts from The Edge, his trading diary available exclusively on RealMoney Silver , confirm that he is putting his money where his mouth is.)
Some Long IdeasThis blog post originally appeared on RealMoney Silver on Oct. 20 at 11:59 a.m. EDT. Here are some of my ideas as to where I would begin to look for long investment positions amid the carnage we call the U.S. stock market. I would stick with companies that are self-funding (have limited external financing requirements), diversified (not dependent on narrow end markets) and not U.S.-centric with a broader geographic focus (i.e., a beneficiary of export and emerging market growth). Within the context of a low interest rate environment, I would particularly emphasize high-yielding stocks. Some examples might include American Express ( AXP), General Electric ( GE), Freeport-McMoRan Copper & Gold ( FCX), the Consumer Staples Select Sector SPDR ( XLP), Hatteras Financial ( HTS), Disney ( DIS), Peabody Energy ( BTU), Linn Energy ( LINE), Atlas Pipeline ( APL) and Transocean ( RIG).
Recommended ViewingThis blog post originally appeared on RealMoney Silver on Oct. 21 at 7:50 a.m. EDT. The disruptive influences of a collapsing hedge fund industry, of Lehman's (and others') failure and of margined CEOs who are forced to sell their positions have had a large and cumulative impact on the general market's drop as well as adversely affecting the picture for a number of individual stocks. Yesterday, I wrote a column describing some individual stocks that could be opportunistic buy candidates and, importantly, the characteristics for which I would be looking. After the close yesterday, one of the stocks I mentioned in that column, Linn Energy, reported a hefty 63-cent quarterly dividend payment, and the stock rose by $3 in after-hours trading. A bit later, Jim "El Capitan" Cramer interviewed Linn's CEO, Michael Linn, on "Mad Money." As a result of that interview, it is now clear that the supply of stock held and ultimately sold by Lehman had served to put undue and artificial pressure on Linn's shares for several weeks. Run, don't walk to watch Jim's interview, and check out Linn Energy.
Mortgage REITs Will Benefit From Drop in LiborThis blog post originally appeared on RealMoney Silver on Oct. 21 at 9:18 a.m. EDT. The most direct beneficiaries of a fall back to earth in Libor are the mortgage REITs. With a continued drop in Libor will come a resumption of wide spreads. Moreover, I wouldn't be surprised if the shares in this group -- similar to the example of Linn Energy posted earlier -- have been artificially deflated by Lehman and related forced selling. Mortgage REITs remain my favorite long sector.
Doug Kass writes daily for RealMoney Silver , a premium bundle service from TheStreet.com. For a free trial to RealMoney Silver and exclusive access to Mr. Kass' daily trading diary, please click here.