anino

mayroon akong kasama

saan man ay dala-dala

nang dumilim ay nawala

wala na akong kasama

                         

this was a poem a wrote when i was in high school and i decided to write it here right now to reflect my mood. i just want to vent out my loneliness, frustrations, disappointments and anger. i just want to get it out of my system so that i could function properly again. 

exhausted

hello again everyone. its been quite some time since ive written something here in my blog. july has been a very busy month with me and to be honest with you im even feeling a bit under the weather writing this article. my friends and i did some fund raising for the flood victims here in iloilo, then i had some relationship problems and a ton of work at the office. as my friend's dad told me at a party at their home "we're getting clobbered" referring to the philippines stock market. :) i too physically am getting clobbered just like the market. but its okay i know i will recover. i just need to rest a little.i was able to get some information on some stocks and i will be writing about it soon. :) please bear with me just for awhile. i see a lot of great stocks selling on bargain prices right now. :) if you have excess cash and willing to invest for the long term now is a great time to do so in my opinion. there is not much to say right now then you dont have to buy you could just wait for the market to stabilize and then dive in. :) i will definitely have a better article for you next week. :)  for any comments, suggestions and questions please email me at compounder888@gmail.com.

ps my former best friend is such as asshole. hehehe good luck to you all

we all need lubricants!!!!!!!!!!!!!!!

oil's is in its last parabolic leg. time analysis suggest it should end july til sep (max early oct) as base 3 (or the period covered by X) is only 10 months. in the sample chart of broadvision, the perfect parabolic curve of its X is also 10months and its last leg was due on the 8th time bar. on it's 9th time bar, broadvision broked the key reversal red trendline. im just fascinated by the resemblance of oil's parabolic with broadvision. unfortunately, prices cant be determine but if we use mathematical proportion we can guess. 

broadvision x = 90, high = 138 (did not doubled in percentage but the leg is shortest in percentage increase); gain = 53%

last leg parabolic started 138 to 192 within 8 time bars.
% change = 192/138 = 39%

ratio of % gain: last leg parabolic of boradvision is 73.5% of it's X percentage gain. to show = 39/53 = 0.735
----
oil's x = 50, high = 98 ; gain 96%
oil's last leg started at 88 (base of red trendline)

solving for "guessed" max/high price of oil's last leg:

formula: projected max/high price of last leg = (start of oil's last leg parabolic) times (1+(percentage gain of oil's X) times (ratio of % gain of X and parabolic of broadvision))

given:
ratio of % gain of broadvision's X and last leg = 73.5% or 0.735
start of oil's last leg parabolic = 88
% gain of oil's x = 96% or 0.96

compute:
projected max/high price of last leg = 88 x (1+(0.96 x 0.735))= $150/bbl


caveat. there's no relation between broadvision and oil except similarity of their charts. there are other parabolic chart sample other than broadvision which could lead to different ratios and proportion. so happen both charts have similar wave counts (base 2 to base 3) and time correction pattern (base 4) as well as valid trendlines (4 of them with the red trendline as the key).


Support the street children movement.

this is spyfrat's post. :) spyfrat is a fllod victim and yet he still had the time to write something for us here!!! a true testament for his love of investing and trading. :) i decided to add little flavor to the blog by having a guest writer from a different school of thought. :) but of course i still believe the your investing style really depends on what your goals are and your tolerance for risk and patience. after all short term investors and long term investors are after the same thing PROFIT! we just have a different process of doing it. as they say in school in math class "the process doesnt matter as long as you get the right answer."

ps for any comments, questions or suggestion please email me at compounder888@gmail.com

i will also try to have a fundamental analysis of oil next time if i have the time. :)

typhoon frank

i will let the photos speak for itself. typhoon frank has hit iloilo hard. help is badly needed here. my high school batch is raising funds for the flood victims. please email me at compounder888@gmail.com if you want to make a donation. thank you very much and God bless.

basketball, investing and life

Getting emails from readers and maybe some avid readers really puts a smile on my face. :) thank you so much for giving me a piece of your mind. :) and a reader sent me a mail today and maybe i could say “challenging” me to use the 2008 nba finals for tips on how to invest. :) well dear sir i am up to the challenge of doing so and it really got my juices flowing to write this article. :) im sure you might have noticed that i am a basketball freak from a few articles of mine about basketball. :) im going to write about the 2008 nba finals, the boston celtics and the los angeles lakers. We will use basketball to learn more how to deal with life and how to invest better. :)
during the regular season of the nba the boston celtics were able to have the league's best record with 66 wins and 16 losses and a very big improvement from last year's record of 24-58. the team before the season started was bolstered with trades for kevin garnett(one of the most versatile big men the game has ever seen but has never had any playoff success) and ray allen(one of the deadliest shooters the game has seen but also has never been to the nba finals). The celtics was one of the favorites to win the championship at the start of the season with the new player additions but there were also doubts if the three big stars could play together. :) they showed everybody that they were serious of winning a championship and played beautifully together leading to the nba's best record. :) los angeles on the other hand had a shaky start to the season with kobe asking the team that he be traded. But all ended well when trade talks ended up empty and the lakers got lucky and were able to trade for the spaniard pau gasol from the memphis grizzlies. The trade definitely strengthened the team and instantly made them championship contenders. :) with this we see management coming into play and how important it is in both team's succes. With danny ainge and boston coach doc rivers they were able to get three great players(i should also say future hall of famers) to play together and blend their talents with the rest of the team and eventually win the nba finals trophy. :) the los angeles management and phil jackson on the other hand were able to let kobe stay with the team and surround him with players that would complement him. So here is my point when it comes to investing, good management will always go a long way. :) and my next point is that good management also needs a good product in order to succeed and in basketball it is the players that is their asset. :) good products and good management are important ingredients for success just like both teams we mentioned. :)
at the start of the playoffs everybody started doubting boston already because they barely got eliminated in rounds one and two with supposedly “weaker” teams but they started playing better in the eastern conference finals dispatching the powerhouse detroit pistons and played even better in the nba finals. The los angeles lakers on the other hand continued their beautiful play from the regular season easily defeating their opponents denver and utah in rounds one and two. They even eliminated the defending champions san antonio spurs in just five games. :) there are a few factors on why the boston celtics were able to beat the lakers. :) ive read expert articles and predictions before the start of the finals and according to the so called experts in almost all the positions the lakers had the edge and 80% of them predicted that los angeles was going to win in six games. :) but what happened????? boston won it in six games with some of the factors that i am going to mention. Home court advantage as they say there is no place like home. :) boston has always been known to have one of the best fans in the nba and with your city behind you it even makes you wanna play harder. :) boston wanted it more, they just wanted to win more and it is very evident with the way they play. The perfect example was paul pierce in game one when he sprained his knee but opted to continue playing cause for him it was now or never in winning a championship which really inspired his team. They played more intense, more passionate and with more desire. Players like rondo and perkins also got injured during the series but continued playing and helping their team and i could say that they were in inspired by their leader. The team with more desire to win the game will surely win it. :) it seemed to me the intense play of the celtics “rattled” the lakers and lead them to fall apart. It is not enough to have a plan because what is really essential is having a great plan and being able to put it into action and the lakers failed in this for they got away from their game plan. :) boston's bench outplayed la's bench. During the regular season the lakers played really well because they had great support from their bench but in the finals the la bench was really outplayed what could be the reason???? i really couldnt explain but i think it boils down to who wants to win more. Boston was able to control superstar kobe bryant and he never dominated the series. How did boston do this??? by scouting and studying their opponents carefully. :) just like in investing everything starts with research and i believe is a very big factor in success. :) they controlled kobe forcing him to be more passive in offense and pass off to his teammates and make them beat boston and they never stepped up and maybe i could say they were demoralized too seeing their leader having a hard time with the celtic defense. :) if you really look at the celtic team there is nobody who could defend kobe one on one. What boston did was to have a first defender and behind him was a second defender and the rest of the team waiting for him. This is teamwork at its best. :) boston had a good plan and executed it to perfection. :) boston really played like a team passing the ball, everybody contributing and playing their roles well and playing good team defense. :) in the nba it is not enough to have talent but also to have the heart and will power to win. It is what separates the good players from the great players of the game. :) these are the players that inspire the rest of the team to follow their lead to victory. :) the 2008 boston celtics i believe was one of the best teams that this league has seen in a very long time, one with talent and heart. This was really displayed during game4 of the finals when boston overcame a 24point deficit to win the game(mind you on their opponent's home court) and only great teams have the character and capacity to accomplish feats like this. They just might have destroyed the morale of the lakers organization just like the dallas mavericks when they had their game3 blunder against the miami heat in the 2005 nba finals(the organization was never really able to recover from that loss). Hopefully this does'nt happen to the los angeles lakers for i have been a big fan since the 80's when kareem and magic were still playing but i decided this time to root for boston because i know that my “best friend” (who is a traitor) bet a lot of money for the lakers to win the series(if my sources are correct around P120K). :) and another reason for cheering for boston was that the big 3 kevin garnett, ray allen and paul pierce are all gentlemen of the game and truly deserve to win championship. :) in the more than 50 years of the nba boston and la met each other in the nba finals for the eleventh time and after this series boston has dominated la 9 wins to 2(of the 17 championships of boston 9 were at the expense of the lakers). why is that so???? i believe it is in the philosophy of the organization. Boston has always been team oriented, efficient and has always been known for their defense while la on the other hand has always been known for their big name superstars and their offense. Just a brilliant example that most of the time defense will always win over offense because with defense the margin of error is lower. :) i hope you enjoyed reading and this helps you with your investments and in life. :) good luck
ps. i didn't bet any money on the series. Hehe im just happy that boston won. :) for any comments, suggestions or questions please email me at compounder888@gmail.com. :) to a few who asked about oil, gold, biodiesel(luckily ive been researching on the subject for a few months now), commodities, food prices, food crisis and about some stuff ill try to find time to write about it. in chiefstocks we just dont talk about stocks and business but also about life and how to make it better for everyone!!! good luck and God bless you!!! till next time. :)

The Law of One Price

prices and economic incentives:
comparing apples and assets
We expect the same thingto sell for the same price. This is the Law of One Price. Why should this be true? Common sense dictates that if you could buy an apple for $0.25 and sell it for $0.50 across the street, then everyone would want to buy apples where they are cheap and sell them where they are priced higher. Yet this price disparity will not last: as people take advantage, prices will adjust until apples of the same quality sell for the same price on both sides of the street. Furthermore, a basket of apples must be priced in light of the total cost of buying the fruit individually. Otherwise, people will make up their own baskets and sell them to take advantage of any mispricing. the arbitrage relationship between individual asset prices and overall portfolio values is explored later in this chapter.
The structure imposed on prices by economic incentives is the same in financial markets as in the apple market. Yet a different approach must be taken to determine what what constitutes the “same thing” in financial markets. For example, securities are the “same” if they produce the sane outcomes, which considers both their expected returns and risk. They should consequently sell for the same prices. Similarly, equivalent combinations of assets providing the same outcomes should sell for the same price. Thus, the criteria for equivalence among financial securities involve the comparability of expected returns and risk. If the same thing sells for different prices, the Law of One Price is violated, and the price disparity will be exploited through arbitrage. Thus, the Law of One Price imposes structure on asset prices through the discipline of the profit motive. Similarly, if stocks with the same risk have different expected returns, the Law of One Expected Return is violated.

Economic Foundations of the Law of One Price
The Law of One Price holds under reasonable assumptions concerning what investors like and dislike and how they behave in light of their preferences and constraints. Specifically, our analysis assumes the following:
More wealth is preferred to less. Wealth enhancement is a more comprehensive criterion than return or profit maximization. Wealth considers not only potential returns and profits but also constraints, such as risk.
Investor choices should reflect the dominance of one investment over another. Given two alternative investments, investors prefer the one that performs at least as well as the other in all envisioned future outcomes and better in at least one potential future outcome.
An investment that generates the same return(outcome) in all envisioned potential future situations is riskless and therefore should earn the risk-free rate. Lack of variability in outcomes implies no risk. Thus, strategies that produce risk-less returns but exceed the risk-free return on a common benchmark, such as the U.S. Treasury bills, must involvemispriced invesments.
Economic incentives ensure that two investments offering equivalent future outcomes should, and ultimately will, have equivalent prices(returns).
The process of a short sale are available to the investor. This assumption is easiest to accept for large, institutional investors or traders who may be considered price-setters on the margin. Even is this assumption seems a bit fragile, market prices generally behave as if it holds wel enough. The nature and significance of short sales are discussed more later in this chapter.

Systematic, persistent deviations from the Law of One Price should not occur in efficient financial markets. Deviations should be relatively rare or so small as not to be worth the transaction costs involved in exploiting them. Indeed, when arbitrage opportunities do appear, those traders with the lowest transaction costs are the ones likely to be the only one who can profitably exploit them. The Law of One Price is largely-but not completely-synonymous with equilibrium, which balances the forces of supply and demand.

This article was in response to an email sent to me asking if there was a law(like supply and demand) that could support value investing. Then here it is for everyone to read. This was taken from the book “understanding arbitrage: an intuitive approach to financial analysis” pages 5 to 7 by randall billingsley. Wishing you all good luck on your life and in your trades and investments. :) for any comments, questions or suggestions please email me at compounder888@gmail.com

the new philippine heroes

Hello again everybody im back after a three week hiatus for a little vacation. :) it was a good break after a year of hardwork. :) and of all my vacations i have to say that this one gave me a lot of realizations. :) first realization of was of being how rich the greek culture is and how much it has influenced the world and especially the roman culture. As they say “the glory that was greece, the grandeur that was rome.” and how true it is. :) and the next i will explain further in this article. :) the first part of the vacation was a land tour around athens, kalambaka, meteora, delphi and olympia. :) and the second part was a cruise around the greek islands mykonos, patmos, heraklion, rhodes and santorini. :) the cruise ship had around 2,000 more or less passengers and it had 432 staff members of which more than a hundred were filipinos. :) and the filipino crew members recognizing us being their “kabayans” they were friendly and were asking about how things are back home and told us about their lives in the ship which really touched me. Compared to working in the philippines there is no doubt that they are paid better working abroad but the sad part was that they were in europe and all their expenses were in euro but they were paid in us dollar(greeks are smart eh?). :) they usually have contracts of 8 months and mind you there is no day off and they work 12-13 hours a day. Tsktsk i remember a waiter telling us that sometimes he or most of his fellowmen in the ship get home sick and are too tired to keep on working but just receiving one text message from loved ones back home and it is enough to keep them going. I was really touched when i heard that. Then the first filipino staff member that i met in the ship was mike the head bartender and his story was that he sends back 80%-90% of his salary back home because he has three kids who are going to school. Can you imagine such sacrifice. He was also a champion in a singapore bartending event and he is even given a 30minute bartending and juggling exhibition in the ship for its passengers and i curiously asked him if he is given extra because of that skill. Then he told me that he didnt ask any extra pay from the company for that but in exchange he just asked that his brothers also be taken in the company for work and he has three brothers also working in different departments for the same company. Such a touching story. :) he even gave me a hundred dollars to bring back home and left me the choice of jewelry that will fit his budget for his wife because it was her birthday. :) then another was a waitress from iloilo also and she told us of her plans that she was going to save enough money to buy a van for her mother back home to start a rent a car business and help the whole family. :) and she also sent a $100 through us for her mother. It was really touching to hear stories of our heroes abroad. They are truly our heores for if it wasnt for the ofws our country wouldve been in much worse shape. They have basically helped sustain our economy. Helping kids go to school, helping build homes and helping millions of other filipinos live better lives. :) the government should do something so that our fellowmen wont be forced to go abroad to find work. More jobs should be generated here in the country! :) the ofws are our modern day heores! Long live the ofws! Long live the filipino and the filipino spirit! :) God bless and take care. :)

"I've been rich and i've been poor: believe me rich is better."

gloria grahame

iba ang langhap sarap

Hello there again everyone and i do hope all is well with you. I recently just had a check up with the doctor because i have been having heartburns recently and i was afraid there was something wrong with my heart and i had a sigh of relief when the doctor said that my heart is normal and the cause of the heartburns were acid. Tsktsktsk so my advice to all of you dont skip meals and eat at the right time. :) anyway its also ironic that the topic that ill be discussing with you today is something very close to my heart, it is FOOD!!! hehehe especially fastfood. :) one thing is for sure, we all have to eat, sleep and drink. :) there were two gentlemen who e-mailed me about jollibee and whats my opinion about it. Im sorry it took me quite some time to reply and to a few other emails ill reply soon. :) Hopefully, i can explain this to you clearly. :) when i first bought jollibee three years ago it was only P24.00 per share. :) thats was after i did my research. :) jollibee back then was the number one fastfood chain in the country and still is until now. :) and i am glad to say that the philippines is one of the few countries and possibly the only country where mcdonald's is present and the latter is not the number one fastfood chain in that country. That my ladies and gentlemen is a very big testament of what a great company jollibee is(by the way im just talking of jollibee fastfood and that doesnt include the other companies that it acquired chowking, greenwich etc). Ronald mcdonald is no match for the bee here and a big part of that is the tan caktiong family which is headed by mr. Tony tan caktiong. :) a truly dynamic leader and visionary in the food industry here in the philippines. Transforming a small ice cream parlor into a fastfood chain with branches philippines even up to tawi-tawi or is it jolo im not sure exactly where but around that area which is just open on weekends. :) doesnt matter if youre just open two days a week because if i have it right its sales there every weekend is around the six digits range. :) i hope mr ronnie mcdonald can say he has a branch there. :) so if some people say that jollibee has no room to grow then its true! Where else would it open??? when it is almost everywhere now. :) when youre number one there is very little room for growth and it is so hard to stay at the top but when youre catching up then i do believe there is still a lot of room for you to grow. :) with this dillema jollibee made a great move acquiring companies and not just any company but ones within their core competence. :) great fastfood companies and restaurants. :) not like san miguel when they had no room for growth they acquired different kinds of companies even investing in the power sector????? thats not the right way to invest, it should always be something that is within your core competence. :) jollibee acquired chowking, greenwich, red ribbon, delifrance and yonghe king and i hope i didnt leave out any company. :) now with that there will be ensured growth in the company for years to come. :) so now back to jollibee to make sure things are still the same i did a survey among family, friends and employess be it young, old, rich or poor it really doesnt matter i just wanted to get the people's beat. :) the results that i got are interesting. :) among social classes a,b and c here are the results: among the a market it is almost a tie between jollibee and mcdonalds. :) the former here has a very slim lead over the latter. :) i would estimate not over 5%. :) in the b and c market it is really dominated by jollibee which i would say more or less has 60%-70% of the market share here. Im sure you guys are familiar with the social structure here in the country which is 10% - a, 20% - b and 70% - c. then you can do math with that. :) it shows you the dominance that jollibee has over mcdonalds. :) here are some of the impressions that i got doing the survey...with jollibee it appeals more to the “masa” and to the kids. People also have an impression that the food prices in jollibee is cheaper. And people prefer jollibee because of the chicken, pies, palabok and spaghetti :) a little trivia it is only here that mcdo serves spaghetti :) a true testament of jollibee's dynamism which mcdo was forced to copy. :) and jollibee's number one food is not their burgers but their chickenjoy. :) now with mcdonalds i got the impression that more sophisticated people eat here and people go there for the burgers and the fries which i also would agree but in fairness jollibee has improved with their fries the last few years but still mcdo has that edge in that department. :) but i think the one big edge that the bee has over mcdo that can never be changed is that jollibee is filipino. :) they are closer to the filipino's heart because it is truly ours and they are able to cater something that is to the filipinos liking and taste. :) i remember this jollibee advertisement 10 years ago when our country was celebrating our centenial celebration there was this advertisement of a kid and marlou aquino with the philippine flag in the background and the line at the end was “iba ang pinoy”. I believe that mcdonalds wasnt able to counter that. :) i do know that mcdonalds is also a great company and their food is great too but in the battlefield it is just like the americans and the vietnamese during the vietnam war. :) the locals just knew more about their country. :) jollibee is truly one great story of a david fighting the goliath and succeeded. :) God bless everyone and good luck in your investments. :)
ps: for any comments, suggestions or questions please email me at compounder888@gmail.com. please also feel free to answer the poll questions :) i will always make sure that there are 2 or 3 poll questions open everytime you log in. :) please forgive the typographical errors that i commit sometimes :) i just have to keep on writing when i have a good idea. :) good luck on your endeavours. :)

benjamin franklin

an investment in knowledge always pays the best interest. :)

rice rice baby

I have always stated that the us is going to suffer a recession and i am that happy that somehow it really happened and i didnt make myself look like a fool. ;) but after that i also stated that prosperity will transfer here in asia and after a few months this year it hasnt looked promising..... tsktsktsk :-( and my dad has consistently repeated that we are in a crisis right now and after doing a little research and careful study on the subject my father was right on a lot of points and maybe without being conscious about it.... the drop in the american economy drove investors and speculators alike to buy gold, oil and other commodities as a hedge against the weakening us dollar. As a result, it drove the prices of commodities up which resulted a meteoric rise of gold and oil, even reaching new highs, with almost every machine in this world being driven by oil it resulted in rising costs in everything from transportation, food and almost everything. I still believe that there will still be a shift in capital from the us to asia because in simple plain logic any businessman or investor will always put his money where he can get better returns and asia in my opinion is the next best thing after the us right now because asset prices here are not that high compared to europe and other parts of the world. :) so it might be true that capital will probably go here after the us recession but it also came at a price. Tsktsk and then there is another, the weakening us dollar and the strengthening peso, though looking at the bigger picture it is better for our government that our currency strengthened because it will lower our foreign debt which would lower our deficit and same is true with companies with dollar loans. But in return we are also lowering the purchasing power of our dollar dependent families or families receiving remittances from abroad. From P55 to P41 is a 25% decrease so if your receiving $1,000 a month a few years ago it would translated into P55,000 in expenses be it groceries, shopping or investing but now it is only worth P41,000. Ofw family budgets are definitely affected. Then you have to factor in the fact that basic commodity prices have been rising lately. Tsktsktsk gasoline has been steadily increasing the last few years. When i first started driving diesel was at P9.80 per liter imagine that???? below P10 a liter and maybe that was 10 years ago then when i had my own car in college it was at P15.00 already and now its at the P40 range already. Tsktsktsk i will put it in numbers so that you will understand the impact it has on our daily lives.:) 
diesel is increasing at a rate of 15% per annum. tsktsk and i think it will keep on going up and with that expect fares to also go up. And i think the most serious crisis of them all right now is the rice shortage which is a staple to the filipino diet. :) they say that there is a rice shortage and i really dont know the truth behind it. Some say that this is a ploy of the government so that the people will forget about the zte deal scandal. I really dont know but what i do know right now is that a solution should be made for the rice prices to stop rising and to stabilize. Tsktsk im calling all the rice hoarders to please release whatever rice they may have for the betterment of our country. If you keep hoarding rice at this time i believe it is tantamount to economic sabotage and the government should do something about it. :) i have even heard stories that the warehouses of these rice hoaders when they were being checked up by the officials were empty but the truth of the matter is that their stock were in barges in the middle of nowhere. Calling officials please do something about this. I really dont know the truth about this. But that is the story thats been going around. Maybe its just a rumor or maybe its the truth i really dont know but every avenue to fix the rice shortage should be checked by the top men of the nfa. :) please do something about this!! :) according to my friend from the media holp-ups, burglaries and related crimes have been increasing lately which is probably because of desperate attempts for money. These are desperate attempts for money and to be able to provide for their family. Tsktsktsk another sign that a lot of the population are having money problems or hardships. Tsktsktsk im sure the government realizes this and businessmen should expect an increase in wages soon. Tsktsktsk can you see the pattern???? its a vicious cycle!!! everybody is affected in this. :) talked to a college classmate who is now an executive in the sm department store and she told me that the sales have dropped in almost all of their branches and they attribute this because of the rice shortage and it being a staple of every family. Families have to adjust their budgets for the increase of price in rice. Tsktsktsk im sure there will be bad debts here and there because of the crisis but it wont reach that level of the us subprime crisis so we dont have to worry about that. :) let us hold on tight, it will be a bumpy ride in the next few months but i know there is light at the end of the tunnel. :) every economy will undergo its ups and downs and this is something that we have to surpass. :) to put it in simple words i dont know what the market is suffering from right now. Is it just a slight fever of flu i really cant diagnose it. Hehehe :) just continue to do research and continue to find for diamonds in the rough. :) bargains are to be found at this time. :) patience is a virtue. :) i still expect oil and gold to keep on going up so better buy your loved ones some jewelry while its still cheap. :) God bless. :)
p.s. For any comments, questions or suggestions please email me at compounder888@gmail.com. And for questions sent to me by email last week i'll answer them soon. :)

a thought

"returns are normally beyond our control but risk is within our control." - francisco colayco

death, taxes and rising prices

Im inclined to write another article about this one because i just cant stop myself from doing so and that i cant stop people around me from talking about it. :) how many times have we heard our elders talk.... “when i was still a kid coca-cola was only worth P0.10” or “when i was in high school batchoy was just just P0.30” or “when i was still in school my allowance was just P5.00 a week” or “your grandfather bought this lot for only P10.00 per square meter”. :) hopefully someday i can also say that.... “i first bought urc at P6.40 per share.” or “mbt was just selling for P25.00 per share when i started investing in stocks.” :) but these stories are all so true. :) they say that the two absolute things in life are death and taxes and i could say one of the ALMOST absolute things in life should be rising prices in almost all things. :) and that also applies with stocks but.......... only with quality stocks. As warren buffett said “when holding a great stock time is your best friend but when holding a bad stock time is your worst enemy.” When i say quality stocks they are the ones with a solid business with room for growth and at the same time they have solid and honest management :) but just because those two things are present in a company it doesnt that you'll buy them right away but you wait for them to drop to a certain price wherein you could get superior long term returns. :) but that is easier said than done because one of the hardest parts in investing is the waiting...... waiting for the right price that is. :) i have done some calculations of some basic stuff that we consume like coke has increased at an average of 8.25% per annum in the last 50 years and batchoy has increased at an average of almost 12% per year. :) which brings compounding back in my head. :) im a social smoker i must admit and i have to admit that the figures and future compounded returns or losses that is could drive me to stop smoking once and for all. Lets calculate here: if i smoke a ream of cigarettes every month with the cost of a ream for the sake of simplicity at around P300 which is P3,600 in a year. And now making assumptions here are the results. This will be the money that i lost if i had foregone smoking and instead invested it in stocks:
15% per annum in 15 years P29,293.42
in 20 years P58,919.53
in 25 years P118,508.23
in 30 years P238,362.38
20% per annum in 15 years P55,465.28
in 20 years P138,015.36
in 25years P343,426.38
in 30 years P854,554.73
this is the power of compounding to you at its finest. :) and i still havent mentioned the mounting medical bills because of heart, lung, bad gums, bad teeth, insomia, yellowish fingertips and a weaker immune system caused by smoking and not to mention that men are more prone to impotence when they smoke. Phew!!!! so in the end you will lose more than the figures that i mentioned above. :) again remember that health is wealth so dont kill yourself working for money. Enjoy it also every once in awhile. :) i have made up my mind to buy a nikon dslr the d80 model. But please i dont want to count the future income that i will lose if i buy this camera..... its my new hobby and you need to have a diversion every now and then. :) enjoy life but also be prudent. God bless you always and good luck with your investments. :)

green is the color of money

For so many years the man at the helm of the federal reserve was alan greenspan and the question that im going to ask everybody reading this blog is.... “is alan greenspan a genius or a fool?” genius because for so many years he was able to keep the american economy afloat or is he a fool because of too gimmickery that when after he left his post the economy had nowhere to go but down. :) as they say the higher you are the harder the fall. :) economies by nature are cyclical meaning there will be periods of prosperity and there will be periods of depression which is normal. :) just like life itself. :) but during his long term in office which if i remember correctly is over 20years there was hardly a very serious depression. And if i remember correctly the life cycle of an economy with a great upswing and a great downswing is about 30-50 years according to marc faber in his book but i have to check on that again. :) so the last great depression was in 1929, 1973 and possibly 1987 could be considered as well but the question is when is the next great depression? Could it be happening now? Time will tell. :) the federal reserve has been drastically cutting interest rates and it hasn't had any effect yet. (another point that my friend has been raising about greenspan is that if he raised interest rates a bit during his term the crisis wouldnt be this bad)  I have a little opinion or theory if you'd like to call it. Interest rates have been lowered so where are people putting there money? For sure its not in stocks and most likely it is also not in real estate because of the subprime mortgage mess. So where are the americans, investors and fundies putting their money? Possibly in assets outside the us and most likely in commodities which would explain the rise in prices. And could it be possible??? according to the charts, gold has a mimun upside of $1,250 and with this credit crunch fundamentally the us economy will stay down for a while and the most likely place that people will place their bets in would be commodities so hold on tight guys. :)






maybe you guys are wondering why i made a poll about jamby madrigal and pia cayetano. It was just an idea that came up when they had a cat fight in the senate. :) i voted for pia cayetano i have to admit(she's also cute by the way) but i didn't vote for jamby madrigal. What have they both done while they were in office. Jamby making the news for protecting a tree and pia cayetano for entering all those athletic races and stuff. I have to admit they both haven't done enough and i could say that more deserving people deserve to be there. Let your vote be counted. :) good luck on all you invesments. :) God bless. :)
p.s. For any comments, questions and suggestions please email me at compounder888@gmail.com
and a joke for all of you! What disease is the market suffering right now??? answer: beary-beary. :)

$1,000 it is!!!

warren edward buffett - the world's richest man
gold jewelry
silver jewelry
gold has finally reached the promised land!!! it has finally breached the 4digit level. :) according to the charts the minimum upside of gold is $1,020 and who knows what will happen after that??? but looking at the long-term charts of gold like way back 70's and 80's the minimum upside that i could see from the charts is $1,250 and i know what's going through your mind that i might be crazy or something but hey im just telling you what i can see from the charts. :) hehehe i remember when i told my dad this the first time it was like almost 2years ago i was driving and he was in the front seat and he violently opposed! hehehe but now he's a believer. ;) because if you now look at it fundamentally it is now very much possible with the recession in the us and also being an election year you can't expect the next president to immediately make an impact in the economy because those things take time. :) so expect the same from the us in the next 2 to 3 years which would mean a stronger peso against the dollar and higher commodity prices. so the question right now is.... do you buy or do you sell??? the answer i believe that whichever way you go you just have to remember that there should always be a margin of safety in whatever course of action that you will take. :)
     i am now inclined to tell you a story about a friend. i decided to tell you their story as a lesson for all of us. let us remember the important principles of value investing margin of safety and preservation of capital.  this friend and all of her siblings did'nt practice these important principles which in the end made them broke. it is really a sad story to tell but it is something we can all learn from.  after the death of their mother the my friend and her siblings got a sizable inheritance and instead of investing the money into something that could give them good returns they threw it down all in the drain. the most important rule in investing is that you should never lose whatever money that it is that you or in short preservation of capital. :) and then margin of safety they also did'nt practice this because of putting up a business or working to earn a decent income to support themselves they instead decided to live the good life and spend their money and spend it until they got broke. when they got the inheritance their relatives advised them not to spend and take good care of their money but all of these fell into deaf ears. if theu listened to the wisdom of their elders this tragedy could've been avoided. the sad part of it all is that the elders that they didnt listen too are now the people they are running to for help. i really dont know how i could help my friend but if i do help her she should at least have the will to help herself.  let us remember that life is not easy and it is those challenges that we have in life that make life more colorful and give us character. lets go and fight the fight. :) good luck to everyone looking for bargains in the market because there are a lot. God bless.
p.s. for any comments, suggestions or questions you can email me at compounder888@gmail.com
a friend texted me and asked if metrobank is having a bank run. i told him of course not because if the biggest bank and one of the most stable banks in the country does have a bank run it would surely mean the end of our country and everybody in it.
i would like to end this article on the lighter side. what is the difference between a penis and life??? answer: life is always hard!!! hahahaha
good luck manny pacquiao! go out there and make us proud. :)

"the three most important words in value investing are: margin of safety"

warren edward buffett - has finally reached the number one spot in the forbes richest list.  this is a little tribute to the world's greatest value investor. :) he has basically changed my views on investing and business which my dad should really be thankful for. :) i could say that he has changed my life. :) he might have a lot of detractors and non-believers but i could only say this "you cannot argue with success!" congratulations for making it to the top of the forbes list mr. buffett! long live value investing. :)

vantage point and questions

Hello there again to all of you. :) i watched the movie vantage point with my girlfriend and friends and it made me think. :) the truth and your actions really do depend from your vantage point. :) this is true in our everyday lives, politics, work, love and almost everything. I'll touch on that more as we go along. :) i have been busy the last few weeks with business, work and a lot of things but i always try to make it a point to find time to write in my blog for it has become a new passion of mine. :) my dad and i have been to makati a few times in the last month to look for other business interests or alternatives if you want to call it. :) this is a result of very low interest rates in the bank. :) i believe most businessmen right now are doing the same thing, looking for an asset to give you a better rate of return than the bank. :) my dad is really not a big fan of the stock market not really because it is a bad investment but because he cant take the volatility or the uncertainty of the market. He would rather put his money somewhere else more stable even though it has a lower return. :) that is his comfort zone. :) he would rather have a tangible investment or something he could see and he couldnt understand the point of owning “paper” as an asset. But that is beside the point because the point is that you should do whatever you are comfortable with and understand and sooner or later you will succeed. :) we were in batangas last week to look around and i would like to ask what do you think of batangas for an investment because they say that it is the next big thing and after manila and makati the trend is now going there??? that is what they say so what can you say about it? The ayalas are there already and so is wton properties by lucio tan. :) how about laguna??? is it good to invest there??? we also went to the santa lucia mall in cainta, rizal and we were impressed and we might put up a restaurant there. :) is real estate really going to boom? Or will real estate falter because most of the projects being built right now are catered to the ofws but the big problem that that market is facing is a stronger peso meaning that their buying power is somewhat affected. But is it also possible that there will be a real estate oom because of low interest rates??? it is really a tough call but i still believe that in the end the latter is the most likely result but lets wait and see because time will tell. :) gold is now trending up strongly and needs less than 3% to hit the 1,000 level. :) and i will not be surprised if it that happends in the next few weeks. :) there are still a lot of bargains in the market and if i only had a lot of cash id surely buy some more. Tsktsktsk ALI is going to issue P1billion worth of securites to finance their plans of buying more properties and the question that im going to ask is that what will be the effect on the stock price and is this a wise move by the company? :) another question that i'll ask is that what has happened to the stock buyback of AC??? i havent checked lately but i do hope that they are still buying. :) so okay what has happened lately??? my “best friend” who betrayed me got an injury in his knee during a basketball game. My girlfriend has a stalker!!! hehehe i dont know how to react should i be pissed or be happy about it? But anyway the good thing is that her stalker hasnt been any problem lately but if that do happens i'll really report him to the police. And a word on the current political situation, please let us work together and just let the president finish her term. Let us look at the bigger picture lets stop fighting and get some work done. Let us work together. Good luck to everyone and God bless. :)
p.s. for any comments, questions or suggestions please email me at compounder888@gmail.com

nba trades and panics

Panic is contagious and it can happen anywhere. :) being a basketball lover myself, the events that happened the last few weeks just before the nba trading deadline expired made me realize that panic can strike anywhere. :) in the nba's west division this panic started when the los angeles lakers were able to get pau gasol for memphis which all of a sudden made them a championship contender. This trade gave their team a legimate center and a filled a very important piece in a phil jackson team, a big man who could pass the ball. But pau gasol is not just a good passing big man but is also a low post threat and a great defender and when andrew bynum gets back from injury they will surely be a great frontcourt(thank goodness they were able to get kwame brown out of the team). Then with this development the phoenix suns were also forced to make a move which resulted to getting shaquille o'neal in exchange for shawn marion. :) i do agree with this move because you need a big man to survive in the nba playoffs which the suns have sorely needed the last few years. But the problem with this trade was that they had to give up a very importat piece in their team. I mean dont get me wrong the phoenix suns are still a great team and will still be one of the best teams in the nba but they wont be a great without shawn marion their team. I consider him a very important piece that made their team click. He is one of the few players in the nba who could defend all positions from point guard to center. He gives you everything points, rebounds, some shooting and defense and also not to mention he is also a great finisher of the fastbreak. :) but still all is not lost for the suns got shaq who we can say is at the twlight of his career but still his presence will surely help any team. They would now be a slower team than before but now more battle ready for the playoffs assuming that shaq stays healthy. :) then the next team that i believe made good moves also would be the san antonio spurs signing kurt thomas a great low post defender and a very solid player and also damon stoudamire a very reliable point guard to relieve tony parker. :) the spurs have just made their once very solid team into a very very solid team with their core still intact i could say that they are still the team to beat. :) with the top teams beefing up in the west guess who made the worst moves you guessed it right MARK CUBAN. Hehehe the dallas mavericks made a very disastrous move. :) sure getting jason kidd is great but overall i think they took a step backward. :) they gave up devin harris who is a very promising player and they got a player to play a position that i believed was adequate enough in the first place. Jason kidd is great but we must admit he is now on a downtrend. :) at 35 years old that is just too old for a point guard. There's maybe just a year or two left in him while devin harris is an all-star in the making. And if you really come to think of it teams in the west made moves to strengthen their interior then so why make a move to strengthen the teams backcourt when it was okay in the first place??? as they say if its not broken then why fix it. :) they should have gotten an interior player ala kurt thomas coulve done more good to their team than getting jason kidd. This move didnt have any margin of safety there is so little room for error. This would mean that its all or nothing for the dallas mavericks this season. Tsktsk what the mavericks did also happens in our market. I believe that it is called institutinal panic when a competitor does something whether it is right or wrong most of the time the other competitors would usually copy that move. :) what happened the last few weeks in the nba is a clear example of that. :) this institutional panic that happens in our market could sometimes open the door for us value investors to get some bargains. So let us always be ready. :) remember what buffett said “i would rather pay for a great company for a fair price than to pay for a good company at a great price.” good luck and God bless. :)

happy valentine's day

Happy valentine's day to everyone!!! :) as of this very moment there is a very intense debate in financemanila and the topic being which is better technical investing or value investing. :) well its been a lively discussion the last few days and all i can say is that(just like in this popular ad a few years ago “kung saan ka masaya te supportahan ta ka!”(wherever you are happy i will support you). :) you dont have to follow a successful investor's style but just get bits and pieces of it. I say this because when you practice a particular style you have to be really comfortable with it because there is no perfect style or system. All systems have its advantages and disadvantages also so you should be able to take its downside to be able to appreciate its upside. :) doesnt this sound so familiar??? its as if im talking about a girlfriend or a wife but i believe that it is really true. :) being a value investor can you withstand a 20% or 30% drop in your portfolio??? sometimes you have to stomach it for you to be able to enjoy long term gains. :) so whats new?? nothing much but i have been extra busy the last two weeks... i was in manila with my father for work and we also consulted our financial advisor and thank goodness we agree on most points. :) the philippines is doing well and will continue to do so in the next few years even with the us downturn. :) but we agreed that the selling of government assets is not sustainable so the next president will really have a problem with this. Tsktsktsk we also talked about asset allocation of one portfolio but this is one whole topic altogether. :) we also talked about real estate prospects here in the philippines in the next decade. :) we expect the real estate sector to do well because of the low interest rates businessman will be forced to get their money out of banks because they would rather put it somewhere else that could give them a better return on their capital and real estate and financial markets would be a good choice and maybe you could also include currencies. :) we also talked about a university being a great business because it incorporates a good business and then real estate. :) even the taipans agree with him. :) henry sy being the second biggest stockholder in far eastern university and he is also offering to buy this school which i cannot mention as of the moment and also lucio tan also now owning university if the east. :) last february 1 the headlines of the philippine star was the philippines record growth. :) i believe a big factor of this was played by our present environment of low inerest rates. :) we will survive and do well in the next few years i believe because asia now is more mature and will be able to take all the bumps and bruises. :) but dont take my word for it. Continue to do your research and then buy great companies at great prices. :) good luck :) God bless :)

words of sir john templeton

to buy when others are despondently selling and to sell when others are avidly buying requires the greatest fortitude and pays the greatest potential reward.