{"id":13273,"date":"2012-05-30T09:05:21","date_gmt":"2012-05-30T13:05:21","guid":{"rendered":"http:\/\/www.technologyinvestor.com\/?p=13273"},"modified":"2012-05-30T09:23:03","modified_gmt":"2012-05-30T13:23:03","slug":"more-thoughts-on-shorting-and-why","status":"publish","type":"post","link":"https:\/\/www.technologyinvestor.com\/?p=13273","title":{"rendered":"More thoughts on shorting, and why"},"content":{"rendered":"<p style=\"text-align: left;\">Stocks you should short:<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">+ Those which have no reason to exist and are probably going to zero. RadoShack is classic. JCPenney and Best Buy are right up there (or right down there?).<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">+ Those which are cockroach stocks. They produce bad news regularly. The bad news is not &#8220;normal&#8221; bad news. It&#8217;s weird stuff, like the accounts will be late or the auditors are refusing to sign the public reports. Or bad trades like JPM.<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">+ Those which are imploding for specific reasons: e.g. Research in Motion (the BlackBerry maker) whose lunch is being eaten by Apple or Facebook whose IPO price was simply too high.<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">+ High-fliers whose growth has slowed, e.g.Salesforce (CRM) and GroupOn.<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">+ Companies whose world has changed on them and they haven&#8217;t adapted fast enough &#8212; e.g. Dell, Hewlett-Packard and First Solar.<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">+ Those whose stocks are simply way overpriced based on their earnings, e.g. their P\/E is way too high for their growth.<\/p>\n<p style=\"text-align: left;\">You can lose your shirt shorting. You have protections:<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">1. Keep an eagle eye on the price. If it starts rising, get out. Cover your short fast. Keep ultra-tight stops. But have faith in your analysis. Stocks do go up, even if they&#8217;re a great short. Have faith in your analysis.<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">2. If the world changes (e.g. Carl Icahn buys into Chesapeake Energy), get out.<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">3. If the reason you shorted the stock no longer exists, get out fast.<\/p>\n<p style=\"text-align: left;\">Research in Motion is one my recommended shorts . It&#8217;s amazing how fast this company is imploding. This morning Deutsche Bank reported:<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">RIM pre-announces and warns of more restructuring. Following a weekend in which the press reported that RIM was planning to lay off a significant portion of their workforce, the company announced after the close today that conditions remained tight. While the company did not provide guidance on their last call, judging from the number of times they use the word &#8220;challenging&#8221; in today&#8217;s press release the company is tracking below plan. They noted intense competition, weak pricing, falling unit volumes and an operating loss on the quarter.<\/p>\n<p style=\"text-align: left; padding-left: 30px;\">Further details on restructuring are not encouraging The company continues to search for ways to reduce opex. The press release implies that they will be dropping product lines and countries. While the company indicated that they would add to their cash balance in the quarter, we reiterate our view that for several years the company has not been generating cash at levels consistent with their profitability.<\/p>\n<p style=\"text-align: left;\">RIMM has hired Morgan Stanley to help sell the company. But who would buy it? Facebook?<\/p>\n<p style=\"text-align: left;\">One reader responded to my call for more shorts with these:<\/p>\n<p style=\"text-align: left; padding-left: 30px;\">PBR CRM TSLA and GRPN.<\/p>\n<p style=\"text-align: left;\">I like his list.<\/p>\n<p style=\"text-align: left;\">Here&#8217;s yesterday&#8217;s list, again. If you had sold RIMM short yesterday, you&#8217;d be up handsomely this morning.<\/p>\n<p style=\"text-align: left; padding-left: 30px;\">Best Buy (BBY)<br \/>\nCaterpillar (CAT)<br \/>\nDeckers (DECK)<br \/>\nDell (DELL)<br \/>\nEaton Vance (EV)<br \/>\nFacebook (FB)<br \/>\nFirst Solar (FSLR)<br \/>\nFossil (FOSL)<br \/>\nGame Stop (GME)<br \/>\nGoldman Sachs (GS)<br \/>\nJC Penney (JCP)<br \/>\nJPMorgan (JPM)<br \/>\nMorgan Stanley (MS)<br \/>\nResearch in Motion (RIMM)<br \/>\nRadioShack (RSH)<br \/>\nResearch In Motion (RIMM)<br \/>\nSupervalu (SVU)<br \/>\nTerex\u00a0 (TEX)<\/p>\n<p style=\"text-align: left;\">Do <strong>NOT<\/strong> short all these. Research them. Pick half a dozen and go for it. This summer will be better for shorts than for longs. Too much talk about economic slowing down in Europe, India and China.<\/p>\n<p style=\"text-align: left;\"><span style=\"color: #0000ff;\"><strong>Our POS Mercedes is on its last legs,again.<\/strong><\/span> Its airconditioning collapsed on Monday. That it was 95 outside made things only more pleasant, especially sitting in Memorial Day traffic jams.<\/p>\n<p style=\"text-align: left;\">Susan is attracted to the VW Touareg diesel. Anyone with experience with this well-reviewed SUV?<\/p>\n<p style=\"text-align: left;\"><span style=\"color: #0000ff;\"><strong>Apple is hosting its annual developer conference June 11-15.<\/strong><\/span> It will be the first without Steve. There is talk of an API for Siri, hence allowing outside developers to write and sell apps that use Siri. There is talk of an Apple TV. Personally I&#8217;d stay away from Apple for now. It can&#8217;t continue its blistering growth with its present products Let&#8217;s see what Mr. Cook can produce, without Steve.<\/p>\n<p style=\"text-align: left;\"><span style=\"color: #0000ff;\"><strong>My favorite, latest, laptop is my new Lenovo X220. <\/strong><\/span><\/p>\n<p style=\"text-align: left;\"><span style=\"color: #0000ff;\"><strong><a href=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2012\/05\/LenovoX220.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-13280\" title=\"LenovoX220\" src=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2012\/05\/LenovoX220.jpg\" alt=\"\" width=\"429\" height=\"272\" srcset=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2012\/05\/LenovoX220.jpg 429w, https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2012\/05\/LenovoX220-300x190.jpg 300w\" sizes=\"auto, (max-width: 429px) 100vw, 429px\" \/><\/a><\/strong><\/span><\/p>\n<p style=\"text-align: left;\"><span style=\"color: #000000;\">Favorite features:<\/span><\/p>\n<p style=\"padding-left: 30px; text-align: left;\"><span style=\"color: #000000;\">+ Fast speed. Get the i7 with oodles of RAM.<br \/>\n<\/span><\/p>\n<p style=\"padding-left: 30px; text-align: left;\"><span style=\"color: #000000;\">+ Sturdy. <\/span><\/p>\n<p style=\"padding-left: 30px; text-align: left;\"><span style=\"color: #000000;\">+ Bright screen.<br \/>\n<\/span><\/p>\n<p style=\"text-align: left;\"><span style=\"color: #000000;\"> <\/span><\/p>\n<p style=\"padding-left: 30px; text-align: left;\"><span style=\"color: #000000;\">+ Great keyboard. It has a pointing stick and a delete, neither of which Apple laptops have. The X220 keyboard is improved over the previous X200.<br \/>\n<\/span><\/p>\n<p style=\"padding-left: 30px; text-align: left;\"><span style=\"color: #0000ff;\"><span style=\"color: #000000;\">+ Windows 8 64-bit, which I&#8217;m warming to. Win 8 requires long learning after my reliable Windows XP. Good news: Win 8 hasn&#8217;t locked up, yet. The key is is to find more X64 applications and be able to use more than 3 gigs of RAM.<\/span><\/span><\/p>\n<p style=\"text-align: left;\"><span style=\"color: #0000ff;\"><span style=\"color: #000000;\">Con: <\/span><\/span><\/p>\n<p style=\"padding-left: 30px; text-align: left;\"><span style=\"color: #0000ff;\"><span style=\"color: #000000;\">+ Many older programs won&#8217;t work on Win 8. It takes huge time to find replacements and to test them.<\/span><\/span><\/p>\n<p style=\"text-align: left;\"><span style=\"color: #0000ff;\"><span style=\"color: #000000;\">Michael, my son, is now using a Macbook Pro, but he bemoans the lack of a delete key. He changed because his company loads Windows machines up with too much stuff, thus slowing their employees&#8217; Windows machines down.<br \/>\n<\/span><\/span><\/p>\n<p style=\"text-align: left;\"><span style=\"color: #0000ff;\"><strong>The French Open Tennis continues.<\/strong><\/span> Check the Tennis Channel. Sarina Williams got beaten in the first round. Sad.<\/p>\n<p style=\"text-align: left;\"><span style=\"color: #0000ff;\"><strong>Mark Zuckerberg writes to Facebook users:<br \/>\n<\/strong><\/span><\/p>\n<p style=\"padding-left: 30px; text-align: left;\">MENLO PARK, CA (The Borowitz Report) &#8211; Dear Facebook User,<br \/>\nHi, it&#8217;s Mark.<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">As you may have heard, our IPO last week didn&#8217;t go quite as well as expected.\u00a0 How badly did it go, exactly?\u00a0 If you live in a major city, you&#8217;ve probably seen homeless guys huddled around bonfires of Facebook stock.\u00a0 More ominously, I just received a call from my attorney telling me that I probably didn&#8217;t need a prenup after all.<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">If you&#8217;re a Facebook investor, you already know what this means: it sucks to be you.\u00a0 But what if you&#8217;re one of the billion Facebook users in the world?\u00a0 Well, it also sucks to be you, because I am writing to you now to ask for your financial support to help save Facebook.<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">It&#8217;s only fair.\u00a0 Since its founding in 2004, Facebook has totally revolutionized the way you waste your life.\u00a0 Without it, you would find yourself in the unpleasant and awkward position of having to speak to your family.\u00a0 And so, to keep Facebook alive, I am instituting the following new usage charges:<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">&#8212; $1 per poke<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">&#8212; $5 for every ex you crop out of a profile picture<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">&#8212; $10 for every time you stalk someone from high school, college, or job you were fired from because of that HR &#8220;incident&#8221;<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">&#8212; $15 for every &#8220;friend&#8221; you have never met (no charge for friends you know, if any)<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">&#8212; $20 for every sheep, bird, or the Scrabble letters Z, X or Q<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">With your financial help, Facebook should be around for many years to come, providing you with hours upon hours of pointless and isolating activity.\u00a0 Without your help?\u00a0 I&#8217;ve just got one word for you: Friendster.<\/p>\n<p style=\"padding-left: 30px; text-align: left;\">Help me,<br \/>\nMark<strong><a href=\"..\/wp-content\/uploads\/2010\/08\/HarryNewtonNewShot2.jpg\"><\/a><\/strong><\/p>\n<p style=\"text-align: left;\"><strong><a href=\"..\/wp-content\/uploads\/2010\/08\/HarryNewtonNewShot2.jpg\"><img loading=\"lazy\" decoding=\"async\" title=\"HarryNewtonNewShot\" src=\"..\/wp-content\/uploads\/2010\/08\/HarryNewtonNewShot2.jpg\" alt=\"\" width=\"125\" height=\"180\" \/><\/a><br \/>\n<\/strong><\/p>\n<p style=\"text-align: left;\">Harry Newton who has shoulder-rotator cuff tendonitis, caused by trying to whack the ball as hard as the professionals do. You&#8217;ve heard this boring story beforehand. But how to fix it? There are several ways: Lay off tennis. (Unacceptable.). Do exercises to strengthen my shoulder muscles. (Boring, but probably useful.) Ice the shoulder regularly, especially after playing tennis. (Very useful.) Visit a sports therapist and get poked into normality. (This is critical. But the key is in the poking. My second sports therapist poked and prodded my muscles, commenting they were &#8220;as tight\u00a0 as guitar strings,&#8221; while simultaneously she pushed my arm higher &#8212; into a serving position.) This\u00a0 was the best manipulation so far. I&#8217;m going back for more. One of the exercises consists of standing in a doorway. Both arms rest on each side of the door. Then I push forward. This helps push my shoulders back and helps my lousy posture. Fixing posture is key.<\/p>\n<p style=\"text-align: left;\">Michael visited us from Portland over the Memorial Day weekend. This is him and Rosie, our 13-month old Havanese, who&#8217;s toilet-trained, finally.<\/p>\n<p style=\"text-align: left;\"><a href=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2012\/05\/MichaelwithRosie2.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-13282\" title=\"MichaelwithRosie2\" src=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2012\/05\/MichaelwithRosie2.jpg\" alt=\"\" width=\"450\" height=\"298\" srcset=\"https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2012\/05\/MichaelwithRosie2.jpg 450w, https:\/\/www.technologyinvestor.com\/wp-content\/uploads\/2012\/05\/MichaelwithRosie2-300x198.jpg 300w\" sizes=\"auto, (max-width: 450px) 100vw, 450px\" \/><\/a><\/p>\n<p style=\"text-align: left;\">Cute?<\/p>\n<p style=\"text-align: left;\">\n","protected":false},"excerpt":{"rendered":"<p>Stocks you should short: + Those which have no reason to exist and are probably going to zero. RadoShack is classic. JCPenney and Best Buy are right up there (or right down there?). + Those which are cockroach stocks. They produce bad news regularly. The bad news is not &#8220;normal&#8221; bad news. It&#8217;s weird stuff, [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-13273","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"_links":{"self":[{"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=\/wp\/v2\/posts\/13273","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=13273"}],"version-history":[{"count":0,"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=\/wp\/v2\/posts\/13273\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=13273"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=13273"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.technologyinvestor.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=13273"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}