Boulder is a Stoopid Place

Posted on May 10, 2016 by ChrisA

Western Digital Is Cheap, But Seagate Is In Trouble – Seeking Alpha

Analysis from Chris Lau at Seeking Alpha.

Seagate’s quarterly results suggest more trouble ahead.
Western Digital has challenges ahead with hard drive sales, but its strategic plans ahead are strong.
Consider Western Digital over Seagate. (emphasis added)

Here is some of the analysis…

Buying Western Digital and selling or betting against Seagate Technologies may make the most sense.

Seagate managed to lower inventory sequentially by 11 percent in its third quarter. Gross margin stood at 23 percent, but the company faced troubling trends. Weak shipments of 39.2 million units hurt revenue, but Seagate offset the negative impact by raising prices. Falling shipments for PCs in the first quarter this year now makes it six consecutive quarters in a row.

Seagate has room to cut costs to sustain its generous 13.2 percent dividend yield. Income investors should learn from high yield investing in deep-water drilling and oil sectors. When prices fell sharply, companies could no longer sustain its dividend. Seagate has room to cut capex by nearly 30 percent to $535 million. Beyond this year, if demand does not improve and prices erode, expect a dividend cut.

Western Digital’s acquisition of SanDisk should give it an edge over Seagate. The higher debt level is manageable. It also sports a higher operating margin than Seagate: (graph at this point in the article – Ed)

Conclusion:

Both Seagate and Western Digital face headwinds in the hard disk market, but Seagate’s poor reliability, unsustainable dividend, and lack of a solid-state disk road map will continuing hurting its share price. Getting bullish on WDC and bearish on Seagate might be the move to make.

Closing stock prices:

STX 19.25
WDC 38.37

So today I’m hypothetically going short STX and long WDC with $20,000 in each stock.

Short: (1039)sh STX @ 19.25

Long: 521sh WDC @38.37

Due to rounding errors the initial value of the investment is:

-$20,000.75 + 19,090.77 = -$9.98

I’ll post weekly updates of how this hypothetical position unfolds. (this sentence edited on 5/28/16 to include the word “initial” – Ed)

Posted in Seagate | Leave a comment

Posted on May 10, 2016 by ChrisA

Parents, if you believe in Freedom of Speech, don’t send your children to the University of Oregon – The University of Oregon’s Thought Police Investigate Students for Saying Anything – Reason Magazine

Yes, university administrators had “an educational conversation” with student-journalists about what kinds of stories they should be printing.

Needless to say, the activities of the Bias Response Team should be concerning to anyone who values free speech at Oregon.

Inquiring minds want to know how many Oregonian’s believe in the freedom of speech. I’m betting there are large swaths of the population that do not. They think they do…. but they don’t. The University of Oregon deserves the same treatment from the general population that the University of Missouri is undergoing.

Why, oh why in the world, do we want a generation of easily offended, politically correct ~~snowflakes~~ students? This will end badly, very badly.

Posted in freedom of speech | Leave a comment

Posted on May 9, 2016 by ChrisA

Maybe we need to rethink “see something, say something.” – Economist Removed from American Airlines Flight for Doing Math

And then the big reveal: The woman wasn’t really sick at all! Instead this quick-thinking traveler had Seen Something, and so she had Said Something.

That Something she’d seen had been her seatmate’s cryptic notes, scrawled in a script she didn’t recognize. Maybe it was code, or some foreign lettering, possibly the details of a plot to destroy the dozens of innocent lives aboard American Airlines Flight 3950. She may have felt it her duty to alert the authorities just to be safe. The curly-haired man was, the agent informed him politely, suspected of terrorism.

…The woman never reboarded to the flight, Menzio said. No one told him, though, whether she was barred from returning or stayed away voluntarily, out of embarrassment or continued fear of the “dangerous wizardry” his mathematical notations resembled.

I guess you can’t fix stoopid.

Posted in Shocked face, you can't make this stuff up | Leave a comment

Posted on May 9, 2016 by ChrisA

News you can use – For Stan Druckenmiller This Is “The Endgame” – His Full ‘Apocalyptic’ Presentation | Zero Hedge

“The lack of progress and volatility in global equity markets the past year, which often precedes a major trend change, suggests that their risk/reward is negative without substantially lower prices and/or structural reform. Don’t hold your breath for the latter. While policymakers have no end game, markets do.” – Stanley Druckenmiller

Read the whole thing if you dare.

Posted in bubbles, finance, financial crisis | Leave a comment

Posted on May 9, 2016 by ChrisA

White Castle and the minimum wage:

Raise the minimum wage until there is no profit. Oh, they’re are only making 1 to 2 pecent net profit as it is. Perhaps White Castle and their entry level jobs don’t deserve to exist. I should get a slider before they cease to exist.

Whitle Castle menu.

Posted in big government | Leave a comment

Posted on May 9, 2016 by ChrisA

SHOCK: Hillary Makes Statement About Classified Documents

Hillary Clinton is either completely delusional about her shady email practices or she is lying about them.

Ya think? Shocked face. You can believe the evidence in front of your face, or what comes out of her mouth.

Posted in politics, Shocked face, you can't make this stuff up | Leave a comment

Posted on May 9, 2016 by ChrisA

Obama White House showed ‘bad faith’ in global-warming case, judge rules

“At some point, the government’s inconsistent representations about the scope and completeness of its searches must give way to the truth-seeking function of the adversarial process, including the tools available through discovery. This case has crossed that threshold,” the judge wrote.

Discovery is considered exceedingly rare in Freedom of Information Act cases because the government is given the benefit of the doubt in claiming it has tried to search for and release documents. But in three cases this year, judges have called the Obama administration’s efforts into question, finding severe oversights that suggest “bad faith.”

Where oh where is my “shocked face” as the most transparent administration evah continues it’s imcompetence

Posted in big government, climate change | Leave a comment

Posted on May 6, 2016 by ChrisA

Inquiring minds what to know – Better Value Play: Western Digital Corp. or Seagate Technology PLC? Remember, you don’t have to play in this game at all!

Can investing in SSD’s save them?

WD and Seagate are trying to counter the cannibalization of their core HDD businesses by diversifying into SSDs, but both companies could merely be shifting from one commoditized market into another.

DRAMeXchange claims that 2.5″ SSDs cost 11 times more than HDDs on a dollar per GB basis in 2012, but they now only cost about 6.5 times as much. The company expects that gap to narrow to 2.8 times in 2017 and potentially achieve price parity a few years later. If this happens before WD and Seagate diversify enough of their business away from HDDs, their core businesses could collapse.

And the better value (supposedly) is:

WD and Seagate are both in bad shape, but WD is clearly the better pick. Its margins are higher, its valuations are lower, its dividend is sustainable, and it’s better invested in the future through its acquisition of SanDisk. Seagate must make big changes to keep up — otherwise it could be left in the dust by WD, Samsung, and other major storage players within the next few years. (emphasis added)

In closing, I have very little use for the Motley Fool, but the article was timely so here it is!

Posted in Seagate | Leave a comment

Posted on May 6, 2016 by ChrisA

Don’t send your black children to public schools in Houston, TX – LUNCHROOM LUNACY: ISD COPS INVESTIGATE $2 BILL SPENT ON SCHOOL LUNCH

A more detailed report on the $2 bill incident and other cases. Just who is law enforcement serving and protecting?

Posted in stoopidity, thugs, you can't make this stuff up | Leave a comment

Posted on May 6, 2016 by ChrisA

A unbelievable combination of stoopidity and thuggery – Little Girl Detained By Police After Trying to Buy School Lunch with Real $2 Bill,

But the $2 bill was real, of course. There aren’t very many of them but $2s are out there. They constitute perfectly legal tender.

….

That’s right: the 13-year-old didn’t even receive an apology from the authority figures, even though she was ultimately denied lunch that day, according to her grandmother. Grandma also had this to say: “It was very outrageous for them to do it. There was no need for police involvement. They’re charging kids like they’re adults now.”

This may seem like a small, silly story, but the grandmother has it exactly right: public schools overwhelmingly assume that children’s misdeeds represent criminal wrongdoing and should be referred to the police. If little Danesiah had actually been attempting to pass off a fake $2 bill as legal tender, it was the school’s job to discipline her, not a matter for the police. And yet law enforcement is routinely brought in to handle the most trivial behavioral disputes in public schools.

Was there nobody involved in either of these organization that has ever heard of or seen a $2 bill? What if she tried to use a Susan B Anthony $1 coin or a John F Kennedy half dollar?

No apology and no lunch. Shaming in the public square for both law enforcement and school officials. And these nimrods better start working on their very public apology, right now.

Posted in stoopidity, thugs, you can't make this stuff up | Leave a comment

Posted on May 6, 2016 by ChrisA

The disk drive industry sucks. Seagate stock performance sucks worse than Western Digital, although I’m not sure it isn’t a distinction without a difference.

STXvsWDC_6mo
(open image in new tab to enlarge)

Posted in Seagate | Leave a comment

Posted on May 4, 2016 by ChrisA

You can’t make this stuff up – Hatchet throwing and beer: A can’t-miss venture – USA Today

Posted in the weekend | Leave a comment

Posted on May 4, 2016 by ChrisA

Daddy, where do bitcoins come from? – Australian Craig Wright Reveals Himself As Bitcoin Crator “Satoshi Nakamoto”; Skeptics Unconvinced – Zero Hedge

Posted in bitcoin, bitoin | Leave a comment

Posted on May 4, 2016 by ChrisA

News Boulderites can use – An Inconvenient Review: After 10 Years Al Gore’s Film Is Still Alarmingly Inaccurate

Watching “An Inconvenient Truth” is sort of like going back in time. Back to a world where flip phones were cool and “Futurama” was still putting out new episodes. A world where a bitter presidential candidate was trying to rebrand himself as an environmental crusader.

And of course, justification for the City of Boulder forming a municipal power company. Some of Algore’s predictions that the psuedo-intellectual geniuses that run the city have elected to ignore include:

Kilimanjaro Still Has Snow – Not only does Kilimanjaro still have snow, it has snow year-round!
Gore Left Out The 15-Year “Hiatus” In Warming – ‘Gore also claims temperature rise from increases in man-made carbon dioxide emissions were “uninterrupted and intensifying.” ‘
The Weather Hasn’t Gotten Worse

Read the whole thing, unless of course you’re from Boulder or some other progressive city. In that case, make sure your head is firmly implanted in the sand.

Posted in #GREENFAIL, climate change | Leave a comment

Posted on May 4, 2016 by ChrisA

The fracking boom has cut the average household’s energy costs by about $750 a year – THREE CHEERS FOR FRACKING – PowerlineBlog.

Unfortunately, the Green Energy movement doesn’t want you to keep the savings but to use it to subsidize expensive energy.

Posted in energy, fracking | Leave a comment

Posted on May 3, 2016 by ChrisA

Unfortunately, most civil asset forfeiture victims are not lucky enough for their mistreatment to go viral – Police Returned $53,000 They Took From a Christian Band, Orphanage, Church … After the Story Went Viral.

Make no mistake, the only reason the band got their money back is because the story went viral. Why did going viral make a difference? Because law enforcement doesn’t want to kill the goose that lays the golden egg. It’s worth sacrificing this $53,249 to preserve the flow of future income from the next victim whose story won’t go viral.

What makes this story unique is not the facts of the case, unfortunately, but that it went viral.

Eh Wah is a refugee from Burma, a Texas resident, and a citizen for more than 10 years. He’s a volunteer manager for a Christian rock band from Burma, Klo & Kweh Music Team.

Muskogee County, Oklahoma, police pulled him over for a broken tail light and found $53,000 in his car. That money was raised by the band, whose finances he managed. It was to be donated to a religious college in Burma, an orphanage in Thailand (money was “bundled in two or three dozen sealed envelopes with the orphanage’s name written on them”), and some was just for the operating costs of the band itself.

Ingraham noted that police “didn’t like Eh Wah’s explanation for how he got the cash.”

….

He was not charged with a crime, but his money was seized by police.

As shocking as this may sound, it’s unfortunately common. This is called “civil asset forfeiture.” It “allows law enforcement to seize and keep private property, even if the owner has never been charged with a crime,” according to the Institute for Justice (IJ). IJ argues, “No one should lose his or her property without being convicted of a crime.”

From the original Washington Post article, How police took $53,000 from a Christian band, an orphanage and a church, which has significantly more detail…

They took Eh Wah to the police station for more questioning. They let him drive his own car there, with deputies’ vehicles in front of and behind him the whole way. They interrogated him for several hours.

“I just couldn’t believe it,” Eh Wah said in an interview. “An officer was telling me that ‘you are going to jail tonight.’ And I don’t know what to think. What did I do that would make me go to jail? I didn’t do anything. Why is he saying that?”

Eh Wah tried to explain himself, but he had difficulty because English isn’t his first language. He says he had a hard time understanding the officers, and they had a hard time understanding him. He told them about the band and his role with it and how he had been entrusted with the cash. He even had the officers call one of the band’s leaders, Saw Marvellous Soe, who had decamped to Miami while the band was on a break.

Marvellous saw Eh Wah’s number on his phone, but when he answered, he was surprised to hear someone speaking with a thick Southern drawl that he could barely understand — “like in the movies,” Marvellous said in an interview.

“The police officer started asking questions,” Marvellous recalled. “I explained: ‘We are a music team. We came here for a tour.'” Marvellous tried to explain that the band was from Burma.

“He kept telling me, ‘You are wrong, you are wrong,'” Marvellous said. “Everything I said, [he said,] ‘You are wrong.’ I said: ‘We are doing a good thing! And now you are accusing us of being like a drug dealer or something like that.'”

But did they arrest Eh Wah? No, they just took his money.

The officers ended up taking all of the money — all $53,249 of it. “Possession of drug proceeds,” the property receipt reads. But they let Eh Wah go. They didn’t charge him with a crime that night, instead sending him back on the road about 12:30 a.m., with the broken tail light.

How nice of them.

Posted in civil asset forfeiture | Leave a comment

Posted on April 30, 2016 by ChrisA

Berkshire Hathaway livestream!

Posted in Uncategorized | Leave a comment

Posted on April 26, 2016 by ChrisA

Lot’s of nervousness and concern from employee whispers I hear from Seagate/Longmont, and other locations based on blog visitor statistics. – Seagate (STX) Q3 Earnings: Stock Likely to Miss Estimates?

Our proven model indicates that Seagate will likely miss earnings this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to post an earnings beat. That is not the case here, as you will see below.

I’d be nervous too… if I worked at Seagate. Oh, and what makes a model “proven.”

Elsewhere in high-tech: Apple’s Quarter sucked.

Posted in Seagate | Leave a comment

Posted on April 26, 2016 by ChrisA

I can work with this – Vote for me – get rid of them! Trump pledges to do ‘a great service to our country’ after Lena Dunham… – Dailymail.com

List of anti-Trumpers who say they’ll flee the U.S. if he wins now includes Rosie O’Donnell, Lena Dunham, Whoopi Goldberg, Cher, Eddie Griffin, Al Sharpton, Barry Diller and Samuel L. Jackson