"Newsletter" Part Deux

I'll start this week's off with the Buffett watch. Last week Warren agreed to cover $7 billion in insurance claims issued before 1992 by Lloyds of London. This move entails a bit of risk, but if Berkshire plays its cards right, could result in a nice little profit.

In another consolidation move in the financial services industry, Merrill Lynch agreed to buy boutique investment bank Petrie Parkman. Petrie focuses on the North American oil and gas industry. Last month they filed for a $115 million IPO which may have been what sparked Merrill's interest.

Ripplewood Holdings announced on Monday they are preparing a buyout bid of Delphi. They are reportedly going to offer over $10 billion for the struggling automotive supplier. This may lead to a potential investment play if the proper synergies are created, but I have yet to dive that deep into it.

Once again, Goldman continues its dominance in the banking world. With the Industrial & Construction Bank of China being valued at over $129 billion premarket, Goldman is able to recognize a $3.9 billion paper profit, the largest in the firm's history. Though they have to hold the shares for 3 years, they should be sitting fine when the bank celebrated the world's largest IPO around $21.9 billion on Friday. By mid-day the market cap was up over $140 billion making it the 5th largest bank in the world.

So you wanna be a rock superstar? Here's a fine place to start.

Napster: the next YouTube?

The Big MO could have its decision made on the Kraft spinoff by January 31st. Provided there are no other substantial lawsuits filed before now and then, this could be a big mover in the stock (even though it moved quite a bit on the news), which is why we have been following it for so long.

On Friday, Mexico's Cemex offered to buy The Rinker Group out of Austrailia for $12.8 billion in an attempt to create one of the world's largest building materials companies.

The Tokyo Stock Exchange is in talks with the NYX in hopes of creating some sort of relationship to benefit both exanches. Could this result in the first securities market open 24 hours a day?

And last but not least, here is the link to this weeks economic calendar. Not as much market moving info as a couple weeks ago, but there is still quite a bit.

Feel free to either create posts or comment on posts on the blog. Hopefully we can use this as our main source of ideas and discuss them further at the meetings. If there is anything in particular that you want to see added to it, let me know, and I will see what I can do.


Joel

The Exchanges

The exchanges I know of that are publicly traded in the US:
NYX
CME
BOT
ISE
ICE
NDAQ

There may be other smaller ones.

Of these, I think that ISE and ICE are the most likely targets for consolidation.

Also of note: the NYMEX is IPOing in the near future (ticker NMX, date not set, but they get $10 million cash from an investor if they do it in 2006...) This could position them as a buyer (ICE would fit nicely) or further down the road, a target (Chicago or New York?).

Doug

MLP's

As the oil market starts to recover and oil prices are heading toward the prices of last summer, we should look to capture some of the run up. MLP's (Master Limited Partnerships) are the REITs of the oil world. There are several different types but for the most part they are the companies that lease oil pipelines. They typically yeild between 5-50% and enjoy the same run up as energy stocks!! Im currently looking into the taxation of these things they are a completely different assest class. Here are couple to get everyone looking at some, KMP, TPP, PAA, ARLP. On another note if anyone wants the Dorsey Wright manual send me an email.

Chris

BOT still an option

so we let bot slide, but we may still have a chance. I was talking to some people and doing some reading and the board of trade stock is being released in three parts. the first one was six months ago where it shot up a lot and then recently with the CME buying it, BOT shot up more. Tomorrow the second part of the stock is going to be released, so after a few days the stock should fall. then I think we should look into it again so at like a meeting two weeks from now this could be brought up again. prices will be low and the stock should come up again, until the third part of the stock is released in early April sometime. Just a thought so people who know a lot more than I do can look into this and see if this all makes sense.

parker

Little Bit of an Overview

I'm wishing we would have taken BOT a little more seriously when it was brought up a couple weeks ago after the huge boost they got today. I don't remember all the stocks we talked about last night, but I'll put up the ones I recall. If you've done some research, add comments to this post if you have anything you want to say regarding the stock(s) of interest.

USG - United States Gypsum - Buffet's sunk a couple hundred million in this one hoping it will turn around once the housing market gets its feet back under it. I happen to agree.

HET - Harrahs Entertainment - Brought up due to acquisition talks between them and two private equity firms. The current bid is at $83.50 a share, but it could take months for the process to clear as licenses are granted to all the parties involved.

NBR - Nabors Industries - In a similar position to Harrahs. Rumored LBO candidate on the street at $35 per share. They have solid fundamentals and a steady business line once oil prices get back over $65.

MO - Altria - Granted an appeal on one of their outstanding lawsuits which will be another step in the litigation clearing that would allow them to spin off Kraft.

CKP - Checkpoint Systems - This one I did not present, but one that I have grown to like over the past week. It would make a decent tech play, and I feel they are relatively undervalued with solid fundamentals and a sound business model. I'll shoot something more out over the weekend on them. This year may not be so hot for them, but I think they will rebound big over the next 4-5 months

Any stocks I may have missed, either log in and post them on here, add them to the comments, or shoot me an email, and I'll post them.

Inflation was higher than expected today dropping the market, but we're still going to 12,000 and beyond. MOT also got clipped, and may be ripe for a come-back after a couple weeks.



Joel

Tech News

Dannyo

Here is a website I use to find news about technology & computers. No analyst opinions or charts here, but a good way to get an idea of what companies are coming out with and doing.

The Inquirer

We're Rollin

I liked the suggestion on getting one of these going instead of listserving everything. Feel free to either create a new post or just add comments to posts that others leave. I think we should move our meeting recaps on here and open up the discussion on stocks that way as well.

Feel free to post interesting links, sites, or headlines as well, and I'll open it up from here!

Here's to MIG!