Nemont...Jose..What do You Guy's Think of This Deal?

BigHornRam

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Stocks Rally After Citi Secures Capital
Tuesday November 27, 4:38 pm ET
By Joe Bel Bruno, AP Business Writer
Wall Street Advances After Abu Dhabi Agrees to $7.5 Billion Investment in Citigroup

NEW YORK (AP) -- Wall Street rebounded Tuesday after the Abu Dhabi Investment Authority said it will invest $7.5 billion in Citigroup Inc. -- a vote of confidence for the nation's largest bank, which has suffered severe losses amid the ongoing crisis in the mortgage market.
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The Dow Jones industrials rose more than 200 points in yet another volatile session as investors were hopeful the financial sector can remain healthy despite the ongoing credit crisis. The banking industry has been battered in recent months as defaults on home loans have risen and rendered some mortgage-backed securities essentially worthless.

Major financial institutions, including Citi and its competitors, have had to book some $80 billion of writedowns on those holdings -- a trend that has left the markets nervous about the full extent of the damage from soured loans. Citi's ability to secure a capital injection raised hope others might be able to do the same.

"The Citi deal is certainly a relief after a series of negative news on Monday with respect to the financials," said Todd Salamone, director of trading at Schaeffer's Investment Research. Funds like Abu Dhabi's "that have plenty of cash may be viewed as a potential rescuer given the balance sheet troubles the banks are having. A weak dollar makes it that much more possible."

Still, the market showed some vulnerability to anyone raising the specter of a sagging economy, and that caused another day of big swings for major indexes. Concerns about further writedowns caused the Dow to fall 240 points Monday, bringing the blue chip index, along with the Standard & Poor's 500 index, down 10 percent from recent highs, a decline that signifies a correction.

Charles Plosser, president of the Federal Reserve Bank of Philadelphia, said he won't be surprised if U.S. economic data over coming months is weak, and warned that recent central bank rate cuts have increased the risk of higher inflation. Meanwhile, Federal Reserve Bank of Chicago head Charles Evans said in a speech that further turmoil in financial markets could cut into business investment and curb consumer spending on big-ticket items.

According to preliminary calculations, the Dow rose 215.00, or 1.69 percent, to 12,958.44 after being up nearly 250 points earlier in the session.

Broader stock indexes also moved higher, with the S&P 500 index up 21.01, or 1.49 percent, at 1,428.23, and the Nasdaq composite index up 39.81, or 1.57 percent, at 2,580.80.

The seesaw trading so far this week is typical of what investors have seen for months. The market has been erratic as investors have struggled with and tried to overcome concerns about the banking sector, the credit markets, consumer spending, energy prices and the overall economy.

A pullback in oil prices aided the market's gains. A barrel of light, sweet crude dropped $3.28 to $94.42 on the New York Mercantile Exchange on expectations that the Organization for Petroleum Exporting Countries will raise production at its Dec. 5 meeting.

Government bond prices fell. The yield on the 10-year Treasury note jumped to 3.94 percent from 3.85 percent late Monday. Gold prices fell as the dollar rebounded.

Abu Dhabi's purchase of a stake in Citigroup will make the city-state one of the bank's largest shareholders. Sheik Ahmed Bin Zayed Al Nahayan called Citi "a premier brand and with tremendous opportunities for growth." Citigroup shares rose 52 cents to $30.32.

Standard & Poor's said it expects Morgan Stanley will take a $4.2 billion charge, up from an earlier $3.7 billion estimate and projected Merrill will write down 25 percent to 30 percent of its $21 billion of such assets in the fourth quarter. The brokerages' shares continued to rally with other financial stocks.

Still, Morgan Stanley shares jumped $1.85, or 3.9 percent, to $49.80, while Merrill shares added $1.84, or 3.6 percent, to $53.07.

Brokerage shares were somewhat under pressure after Standard & Poor's downgraded Morgan Stanley and Merrill Lynch & Co. to "sell," saying that further deterioration in the mortgage securities market has added to pressure on the value of the investment banks' asset-backed securities. But that news did little to faze the market's enthusiasm.

"While these announcements from the financial industry are continuing to unsettle investors, the lower dollar has put the U.S. in the position of being for sale at attractive prices, so Abu Dhabi can come along and buy an interest in Citi," said A.C. Moore, chief investment strategist for Dunvegan Associates in Santa Barbara, Calif. "Anytime you have corporate action, that's one of the strong bull arguments" for stocks.

The market showed little reaction to a report from the Conference Board that its Consumer Confidence Index dropped to its lowest point since October 2005. The index fell to 87.3 for November, down almost 8 points from the revised 95.2 during October -- and below analyst expectations for a reading of 91.5.

The Russell 2000 index of smaller companies rose 8.20, or 1.12 percent, to 743.27.

Advancing issues outpaced decliners by nearly 3 to 2 on the New York Stock Exchange, where volume came to 1.36 billion shares.

Overseas stock markets ended mixed. Britain's FTSE 100 fell 0.64 percent; Germany's DAX index lost 0.48 percent and France's CAC-40 declined 0.44 percent. In Asia, Japan's Nikkei stock average closed up 0.58 percent. Hong Kong's Hang Seng index fell 1.51 percent.
 

Nemont

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I think Abu Dhabi got an 11% stake in Citi for a relative bargain especially given the weakness of the Dollar. Injecting Capital into the U.S. economy right now makes sense if you have cash on the sidelines and want to get in before the dollar regains some strength.

I think it is the first of many such deals. Wait until the Chinese decide what to do with their dollars, either they can dump them or they can buy up their competition. Either way they have to do something with their $1.5 trillion setting in the China Inc. bank account.

This is just he begining of the fallout from the credit market crisis. There will be much much more before the ship get's righted. I see housing prices came down over 4% nationally, lots of ARM's set to readjust etc, etc. Sounds like there will be some bargains out there to be had in the housing market. Buy on bad news has been the motto of successful investors for years.

Nemont
 

BuzzH

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BHR,

Why not ask your financial guru...Elk Cheese? He has all the answers and a collage degree in business.
 

JoseCuervo

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Stocks Rally After Citi Secures Capital
Tuesday November 27, 4:38 pm ET
By Joe Bel Bruno, AP Business Writer
Wall Street Advances After Abu Dhabi Agrees to $7.5 Billion Investment in Citigroup

NEW YORK (AP) -- Wall Street rebounded Tuesday after the Abu Dhabi Investment Authority said it will invest $7.5 billion in Citigroup Inc. -- a vote of confidence for the nation's largest bank, which has suffered severe losses amid the ongoing crisis in the mortgage market.
I think I like it, as I always like it when investors like Abudhabi follow me on my coattails. I bought Citi last week at $31.75 as, like the Abudhabi, I think the bottom is near. It is always a bit risky to time bottoms, but I think as long as Citi keeps their 6.8% dividend in tact, it is a good investment. I am never surprised when other large intelligent investors follow my moves.

And, for Citi, the 11% coupon they will pay on these units isn't too bad, as it is 60% deductible against income, so the net is about the same as the dividned cost of capital.

Nemont,
Citi gave up 4.9% for the $7.5billion, not 11%. The 11% is the yield on the units that are convertible in the next few years at $37.
 

JoseCuervo

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Thanks Nemont, makes sense. Jose, we'll wait and see if your 3 shares at $31.75 was a good investment.
Just like you didn't think SPWR was a good buy.... you are more than welcome to watch my wealth grow.

How are those 3 shares of Plum Creek doing that you bought? You able to run off to Mexico with CJ yet???

(BTW, what ever happened to CJ, did the stress of worrying about Mexicans finally get him, or did he get crushed by all his gold coins as he was rolling naked in them?)
 

Nemont

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Nemont,
Citi gave up 4.9% for the $7.5billion, not 11%. The 11% is the yield on the units that are convertible in the next few years at $37.
I didn't read it that close just the headlines. Thanks for the correct info. Hope you make alot of money on it.

Nemont
 

Oak

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(BTW, what ever happened to CJ, did the stress of worrying about Mexicans finally get him, or did he get crushed by all his gold coins as he was rolling naked in them?)
Nature's 'slot machine'

John Stanley
The Arizona Republic
Nov. 2, 2007 12:00 AM
Gold fever.

There may be no ailment as intense or contagious - or fun - as the primordial craving for the lustrous, malleable metal.

"People have been interested in gold for thousands of years," says Loye Blackburn, who sells prospecting equipment next to his RV in Stanton, a former boomtown that is now a privately owned campsite about a dozen miles north of Wickenburg. "There's just something about it. You get out there and find a few flakes of gold and it gets pretty exciting."

Blackburn admits he has had gold fever for decades. Over the years, he has parlayed his affliction into a business, Back Country Prospectors.

"I'm not getting rich," he says, "but it helps pay some of my gas bills."

The fever claims new victims daily.

Thousands of recreational prospectors roam the mountains and creek beds of Arizona, trying their luck here and there. Most, though, don't take it too seriously.

"Don't quit your day job. That's the first thing I tell people," says Bob Truppa, host at the Hilltop Campground at Lynx Lake, southeast of Prescott. Truppa regularly gives panning demonstrations and lessons when the campground is open, from April through October.

"I try to stress that this is a hobby. Some of the shows on TV make it look easy. It's not that easy. You just don't run down to the creek and find the mother lode. I've got 28 ounces of gold in 28 years."

The price of gold fluctuates considerably; it flirted with $800 an ounce this week.

But the dream of striking it rich is always there. Truppa tells of friends who've found nuggets they've sold for $10,000. And he notes that the Bradshaw Mountains, the heart of Arizona's gold country, are about 40 miles long and nearly 25 miles wide.

"That's a lot of real estate. Gold is out there; it's not all gone," he says.

Truppa, a full-time RVer, spends his winters in Stanton, another hot spot for Arizona prospectors.

Stanton is owned by the Lost Dutchman's Mining Association, which operates more than a dozen similar gold-bearing sites across the country.

"We get lots of snowbird prospectors here," says Linda Walton, who has worked as the camp's manager for nearly eight years.

For most of the residents, prospecting is a hobby. But Walton has seen a few who got carried away.

"We've had people come out here, and they've quit their jobs and think they're going to make it (as a prospector)," she says. "That's not a very good plan. You can find a lot of gold out here, but you have to be lucky. It's just common sense. You don't quit your job and think you're going to win the lottery."

Still, some people do manage to make a living at it, says Steve Robertson, who has worked at A&B Prospecting Supplies in Mesa for about three years. But he doesn't recommend it.

"I've been (prospecting) since I was 10 years old," he says. "I'm 62 now and I think I could make a living at it, but I don't want to work that hard."

A lot of people go out on weekends when they're hunting or camping or fishing and prospect a little, just to do something different, he says. But some are more dedicated. Robertson says a couple of his customers bring gold worth $1,000 or more into the store on a regular basis.

"They've got a good spot they found, and they keep working it," he says. "They have regular jobs and just go out on weekends."

Other people, Robertson says, may go out and work all weekend for 10 cents' worth of gold.

"Just panning, you're not going to get rich, but you are going to find color," he says.

The best plan for beginners, Robertson says, is to join a club.

"It's inexpensive, and you get a list of places to go to that have gold," he says. "You don't have to worry about claim jumping, and you can go out anytime you want to."

Despite their former reputation for secrecy, solitude and eccentricity, modern-day prospectors are a sociable lot.

Where to go



"Prospectors I've known are more than happy to share information and tips," Robertson says. "True, they won't mark an X on your map showing where they like to go, but they're happy to show newcomers various techniques and equipment and tricks of the trade."

Beginners can try their luck at a couple of areas set aside for panning, in the Lynx Creek Recreation Area near Prescott or north of Lake Pleasant.

And you can pan just about anywhere in the national forests or on Bureau of Land Management land, unless that land has been specifically withdrawn from "mineral entry," says Michael Smith, a geologist with the Prescott National Forest.

"That means land that is no longer open to mining claims," he explains.

Examples would be wilderness areas, wild and scenic river corridors (such as some portions of the Verde River), campsites and so on.

"We view gold panning as a low-impact activity. But if people want to come in and bring dredges and big sluices, we need to talk," Smith says. "Our general rule of thumb is that you can go onto creeks and streams that are not closed to mineral entry."

Prospectors who plan to go beyond simple panning should contact the appropriate land-management agency for regulations and restrictions.

For information on claims, go to www.geocommunicator .gov and click on "Land & Minerals."

'Enjoying nature'



Truppa, the Hilltop Campground host, emphasizes that prospecting is hard work.

A lot of times you recover only a few flecks of gold in a shovelful of dirt, he says. And it can take 300,000 or 400,000 of those flecks to make 1 ounce of pure gold.

Truppa started prospecting shortly after he moved to Tucson in 1979.

"I saw a show on TV, and I thought it looked like something fun to do," he says. "So I joined the GPAA (Gold Prospectors Association of America) and got a mining guide. When I saw that there were four different claims south of Tucson, I got my first gold pan and went out and found a few flakes. And then the gold fever started in."

Prospecting has been a big part of his life ever since.

"It gets you out to see these beautiful areas. And it gives you exercise - you work your tail off, digging in the dirt. Every time you do it is different. The gold color is different from area to area. It just gets you out enjoying nature; it gets you off the couch. I'm 66, and I love it," he says.

Learning the process



Although it takes practice to get the hang of panning, the process isn't difficult.

"When you're starting out, the hardest thing is not to pour off your gold when you're panning," Truppa says.

He recommends that beginners get four or five BBs and put them in their pans, along with a few handfuls of dirt. When they can pan out all the water and most of the dirt and leave the BBs behind, they've got it.

Truppa says that when some people first learn that they can prospect for gold on public land, they're ready to jump in and spend thousands of dollars on sluice boxes, dredgers and other expensive, mechanized gear.

Big mistake, he says.

"I teach everybody to be a prospector first. First, you gotta find the gold. Get some pans and practice. You can go from that to dry washers and sluice boxes if you want to. But learn panning first."

Truppa sends beginners to the set-aside area on Lynx Creek, north of Lynx Lake, near the Salida Gulch Trailhead.

"I've done good down there," he says. "Don't let anyone tell you it's all gone."

Aficionados say it's the process and camaraderie that make prospecting worthwhile.

"Prospecting is better than going down and sitting in a bar," says Blackburn, the prospecting-equipment seller. "It's just a darn good hobby."

Penny Greer, who with her husband, Don, serves as a host at Lynx Campground, agrees.

"(Panning) is therapeutic," she says. "You get a handful of dirt and see the gold in there. It's like playing the slot machines. You never know what you're going to get."
 

ELKCHSR

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Why not ask your financial guru
HAHAHA Buzz....

Some times I really wonder about you!!! :p

Here you're constantly berating others about being clueless and you don't seem to understand the difference between financial issues and overall economics...

I'm thinking you may need to stick to what your good at or take some classes to be able to differentiate (some 101 classes would probably do the trick) :eek: :)
 

JoseCuervo

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"Hope you make alot of money on it." and don't forget to pay your Moosie tax on it if you do, Jose.
I should just take the 2.3% I made on it in one week, sell it today, and go buy the BMW I have been needing to buy. Then I can drive a $5 check over to Moosie and double the amount of money you thought about paying him....
 

JoseCuervo

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Here you're constantly berating others about being clueless and you don't seem to understand the difference between financial issues and overall economics...
Does anybody know what the difference between financial issues and overall economics are?

Does anybody think the The Cheese has a clue about what they are?
 

noharleyyet

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"I should just take the 2.3% I made on it in one week, sell it today, and go buy the BMW I have been needing to buy." (Gordon Gekko)

Whatsamatta, did the neighborhood aesthetic standards board finally condemn your Ford beater P/U truck?:rolleyes:
 

JoseCuervo

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"I should just take the 2.3% I made on it in one week, sell it today, and go buy the BMW I have been needing to buy." (Gordon Gekko)

Whatsamatta, did the neighborhood aesthetic standards board finally condemn your Ford beater P/U truck?:rolleyes:
Nahhh.... it is for the daughter. Just getting your license, she has 2 more months on the Learner's Permit. I just can't see buying a kid that age a Benz, so I will make her settle for a BMW for a year or two. I don't believe in spoiling kids.
 

Nemont

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Nahhh.... it is for the daughter. Just getting your license, she has 2 more months on the Learner's Permit. I just can't see buying a kid that age a Benz, so I will make her settle for a BMW for a year or two. I don't believe in spoiling kids.
You are way nicer then me. My 15 year old daughter had to settle for a purple 1997 Ford Escort. She has had her license since last January.

I am glad to see that you are limiting yours to a BMW and not spoiling her with a Benz. Parenting is never easy.

Nemont
 

noharleyyet

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"so I will make her settle for a BMW for a year or two. I don't believe in spoiling kids." (Gordon Gekko)

Couldn't agree more...it's imperative you keep the acorns as close to the tree as possible.:D
 

BigHornRam

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"I should just take the 2.3% I made on it in one week, sell it today, and go buy the BMWC I have been needing to buy"

BMWC.......Big Mac with Cheese? You are a savvy investor, Senior Queervo!
 
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