{"id":45174,"date":"2018-12-17T09:25:52","date_gmt":"2018-12-17T14:25:52","guid":{"rendered":"http:\/\/www.technologyinvestor.com\/?p=45174"},"modified":"2018-12-17T09:25:52","modified_gmt":"2018-12-17T14:25:52","slug":"to-catch-a-falling-knife","status":"publish","type":"post","link":"https:\/\/www.technologyinvestor.com\/?p=45174","title":{"rendered":"To catch a falling knife"},"content":{"rendered":"

Catching falling knives<\/strong><\/span><\/p>\n

My friend bought a few shares of Schlumberger (SLB), figuring it couldn’t go lower.<\/p>\n

Look at this amazing 5 year chart:<\/p>\n

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Schlumberger is the biggest and best oil services company in the entire world. My friend is super-smart. Maybe he is right? Buy SLB.<\/p>\n

I read everything I could on SLB over the weekend.<\/p>\n

I couldn’t find one piece of evidence (no matter how tiny) suggesting it might suddenly reverse and bound up.<\/p>\n

I did find this:\u00a0As of Sep 30, 2018, the company had $2.85 billion in cash and short-term investments and $14.2 billion in\u00a0long-term debt. That wouldn’t be too awful — if the company were making a profit — but it’s not.<\/p>\n

I hate borrowing money. Why do companies like borrowing? To buy things, Dear Harry. Wall Street encourages them and gets an M&A commission. Dah!<\/p>\n

OK. then what? They are Verizon which just wrote $4.06 billion (that’s billion) off the $9 billion it stupidly paid for Yahoo and AOL. How did that work out for them? I tried to use Yahoo Finance to research SLB and here’s the message I received:<\/p>\n

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Comforting?<\/p>\n

Look at this two-year chart on Goldman Sachs? Surely it’s now a bargain?<\/p>\n

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That price of $172.77 was at Friday’s close. This morning, CNBC reports that Malaysia is taking Goldman to the wood shed and hitting it with criminal charges. It’s dropping more today. Yuch.<\/p>\n

GE is another mess. At one stage it was lauded. Built by Jack Welch who believed he had the magic touch to manage anything, it grew to to be America’s largest conglomerate. Then it all fell apart. Here’s the last two years:<\/p>\n

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The worst news this morning<\/span><\/strong><\/p>\n

From Business Insider:<\/p>\n

We may have just gotten the most alarming sign yet that a stock-market collapse is coming. Investors pulled $27.6 billion out of US equities in the week that ended December 12, making for the second-biggest outflow ever, according to Bank of America Merrill Lynch.<\/p>\n

That pessimism is extending to favorite FANGS like these two (the last two FANG stocks I own):<\/p>\n

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The Gotcha World<\/strong><\/span><\/p>\n

Seems the Gotchas are coming out of the woodwork. Johnson and Johnson knew about the asbestos in its talcum powder. But didn’t do anything.<\/p>\n

Brutus was an honorable man…. Look at JNJ year to date. (Apparently it will fall more today — maybe 3%):<\/p>\n

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The BIG News<\/strong><\/span><\/p>\n

The Fed raises or doesn’t raise interest rates on Wednesday. Everyone says they will and perhaps issue some soothing statement about “That’s it, for now.”<\/p>\n

If they don’t raise rates, the market will boom. If they do, it will flag.<\/p>\n

This is a horrible gamble.<\/p>\n

SNL favorite news broadcast from Saturday.<\/strong><\/p>\n

You’ll die laughing. I’ve watched it three times.<\/p>\n