NEW YORK ( TheStreet) -- Doug Kass of Seabreeze Partners is known for his accurate stock market calls and keen insights into the economy, which he shares with RealMoney Pro readers in his daily trading diary.Among his posts this week, Kass defined what he means when he "rents" a stock or short position, explained why PNC Financial's earnings outshined other those of other big banks, and provided some historical perspective on the extreme level of skepticism among market participants. Please
Defining a Rental
Originally published on Friday, Oct. 21 at 1:35 p.m. EDT.
- There's a method to the madness.
PNC Prevails Over Peers
Originally published on Thursday, Oct. 20 at 10:49 a.m. EDT.
- I wouldn't chase the stock here, but I would be a buyer on any weakness.
Everybody Knows This Is Nowhere
Originally published on Friday, Oct. 21 at 7:41 a.m. EDT.
- Skepticism, on the part of both retail and institutional investors, is at an extreme.
Everybody seems to wonder what it's like down hereOne of the greatest people I ever worked with in my career was Walter Deemer, who, during the 1970s, ran Putnam Management's market analysis department in Boston. Wally has just completed a book titled Deemer on Technical Analysis: Expert Insights on Timing the Market and Profiting in the Long Run, and I am excited that he has asked me to write an endorsement of the book for the back cover. Putnam's fund managers were mostly fundamental analysts, who, as Wally put it in his upcoming book, "thought that their job was to buy the best stocks on a fundamental basis and not worry about the market conditions." In other words, he faced an uphill battle against some legendary portfolio managers and fundamental investors, including Marty Hale, Felix Smith, John Maurice and, of course, my mentor, Jerry "The Chief" Jordan! This, oddly, gets me to the debt crisis in Greece and in the eurozone (and whether Mr. Market has already discounted this problem), but in the context of a famous morning meeting at Putnam in which Wally's philosophy (and market lesson) was best expressed in a short phrase he exclaimed after General Motors ( GM) cut its dividend 37 years ago. Back in the early winter of 1974, Wally's technical signs became aligned, and he recommended that Putnam's bruised fund managers buy stocks after a vicious bear market. Some started to nibble. The market went a tad lower but shortly started to stabilize, and a large rally commenced by year-end. One of the fund managers who took Wally's advice had, among other purchases, bought shares in General Motors. Soon thereafter, during our daily morning meeting, General Motors cut its dividend, and the shares were indicated to drop by almost $4 from the prior day's close. Ticked off, the fund manager turned to Wally and said, "Now what do I do with General Motors?" Wally then delivered the greatest line in the history of Putnam's morning meetings: "Thank God General Motors stock did not decline in vain!" Not surprisingly, General Motors shares, similar to the market, began an impressive rally a few weeks after the dividend cut and the initial price drop.
I gotta get away from this day-to-day running around
Everybody knows this is nowhere.
Everybody, everybody knows
-- Neil Young, " Everybody Knows This Is Nowhere"