Enterprising Investor Forum

We will be traveling until December 15th and might have trouble posting whilst on the road but we will do our best!

We hope to be able to avoid missing too many posts …

Enterprising Investor Forum

Quite curious that Mr. Pandit decided to go to Charlie Rose for his first TV interview and not face a financial journalist…

In this part of the interview, he tackles the question of Citi being too big. He actually states that it is not too big to manage but then again, he says that they have just sold 18 businesses! We assume that what he wanted to say is YES it was to big to manage but we’ll be fine once we scale it down!

Enjoy!

We keep on getting questions about when to get back into the market….. well, we do not want to drive sentiment down even further but we are just starting to get an idea of the implications of the crisis. A brief look at some of the recent headlines:

• New York May Lose 225,000 Jobs in Market Slump

• U.S. Sets $800 Billion Credit Program

• BHP Billiton abandons bid for Rio Tinto, shares drop 35%

• Cisco shares fall after report of 4-day shutdown

• Economy’s tumble even worse than expected in 3Q

• Oil falls below $53 after rising overnight

It’s going to be a long road to recovery but we may be reaching the bottom in terms of all the bad news that is priced into the market - we are not there yet but we feel that we are starting to get there. As we approach the end of the year, we would definitely consider starting to put some money to work at the beginning of Q1 2009 with the aim of establishing initial positions in companies we like throughout the first quarter… hopefully, we should be able to have a better understanding of how long the recovery will take by Q2 2009.

As already discussed in the past, if you are worried about missing the initial rally, you could simply by an index fund that tracks the market but we prefer to pick our companies carefully and have a better outlook before adding any news funds, even if it means missing an initial 10-15% move…

Please read our disclaimer.

Our regular readers know we like Barton Biggs and that we loved his book Hedgehogging (read review here).

In this clip he is talking about the current situation and the fact that he still feels a lot has to be done to solve this crisis…

Enjoy!

These guys are really not helping their case… they talk about saving jobs, their companies and the average go but the truth is that they have probably lost touch with reality a long time ago…

Things appear to be getting worse. First the banks, then the insurers, small businesses, the auto industry, etc … we seem to have reached the bottom in terms of negative sentiment - even though we feel that the actual situation in 2009 could end up being worse than most people believe, or at least, the consequences will be far more wide-spread…

In the midst of this, it always pays to be proactive and positive and that’s why we thought we should post these inspiring words from T. Boone Pickens:

“… the direction of success in never straight up … if … you reach a point where you think all is lost and there is nothing there. Most people, both in business and in life, surrender. As a result, they fall short of their dreams, opportunities, and potential. I learned that if you never give up, if you push through the resistance and keep driving for what you want, you will ultimately achieve rewards beyond any you had hoped for. Because deep down, just beyond the hard, tough spot we all have found ourselves in, there awaits the opportunity to become stronger, more successful, and more fulfilled than you have ever imagined. Never, never, never give up.”

Let’s hope that government says focused on the task at hand and that the key question of the normalization of credit is resolved as soon as possible… once we manage to get the money flow going again, then we can start to try and get things back on track!

Once again, Jim Rogers taking about how Paulson and Co. have no idea about what they are doing and that the American economy is doomed… the interesting thing about this clip is that as the interview takes place, the visuals show a number of financial cartoons that accompany the commentary - some of them are really good!

Enjoy!