The Best of Kass

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 past week, Kass explained why he has become a bull and discussed the possibility of a delay in the Treasury's sale of its AIG shares.

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That's Damn Right!
Originally published on Friday, Nov. 16 at 2:18 p.m. EST.
  • You better believe that I've turned bullish!
  • It was a quick segment on "Fast Money Halftime Report," which concluded in my response to Judge Wapner's question regarding my bullish turn: "Yes, that's damn right!"

    I followed "Chaminade" Joe Terranova in a discussion on Apple ( AAPL), and I am in general agreement with Joe on the shares. (I love that he used my March 2009 "generational buy" term.) He is all in.

    > > Bull or Bear? Vote in Our Poll

    Judge first asked me about Apple and then about the markets.

    On Apple, I suggested, as Joe did, that the precipitous drop in the shares this week was likely in part a function of margin calls from hedge funds that had outsized positions in the stock (some of them that I know have a more than 15% weighting). Apple, I suggested, was a leveraged play on the capital market, and as stocks fell, it became an ATM (a source of funds and liquidity).

    On the market, I emphasized that I had turned and am now bullish, that an opportunity perhaps similar (though not as extreme) to that in the summers of 2010 and 2011 could be at hand. (I appeared on those two occasions on "Fast Money" as well and communicated those opportunities.)

    I specifically said the fiscal cliff would be considerably whittled away from expectations (to $150 billion-$225 billion) and that I am now feeling more confident after hearing the conciliatory remarks from our leaders today.

    The market's fears of a fiscal cliff are overblown.

    One positive thing that has been ignored is that an aide to the president said late in the day on Thursday that only $1 trillion of tax revenue would be sought -- the president had previously said he was seeking $1.6 trillion of tax revenue.

    With a compromise, the business sector is pent-up, not spent-up -- it will step up hirings/spending, and the underlying rate of growth in core economic activity could surprise to the upside.

    Let's go to the tapes.

    At the time of publication, Kass was long AAPL.


    More on AIG
    Originally published on Thursday, Nov. 15 at 1:09 p.m. EST.
  • I suspect the shares would have a nice upside move if the Treasury said it was going to wait on the secondary for at least six months.
  • On "Fast Money Halftime Report," Stephanie Link talked about the prospects for AIG ( AIG), and she opined that one should wait until the Treasury announces the sale of the balance of its stock.

    I, too, have suggested this, but I wonder whether the government could decide not to sell the shares until a later date as the share price has become unattractive to exit and/or the market conditions have changed?

    I noted earlier that a number of very smart hedge funds have been accumulating the shares of late. I wonder if they, too, have thought that the AIG secondary will not take place this year.

    I suspect the shares would have a nice upside move if the Treasury said it was going to wait on the secondary for at least six months.

    At the time of publication, Kass was long AIG.

    Doug Kass is the president of Seabreeze Partners Management Inc. Under no circumstances does this information represent a recommendation to buy, sell or hold any security.

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