"Auriga Picks Up Solar Coverage on Eight Stocks; Assigns Buys to TSL, YGE and SOLF"

UPDATE: "UPDATE 1-Suntech,Trina Solar sign $11.7 Billion loan deals" (STP; TSL)
Original post:
Mark Bachman has been one of the better solar analysts.*
I didn't know that he had left Pacific Crest.
Or that he started spelling his name with a "C".
From Tech Trader Daily:

Auriga USA analyst Marc Bachman initiated coverage on eight solar stocks late this afternoon. His favorite names in the group are Trina Solar (TSL) and Yingli Green Energy Holding (YGE). He sets a price target of $34 for Trina and $18 for Yingli. Among the picks, Bachman, who was previously a solar analyst with Pacific Crest, assigns one Sell rating to SunPower (SPRWA), with a $15 target....MORE

For example here are some of his calls on SunPower, from our March 19 post "SunPower Maintained at Outperform at Cowen - Cut EPS Forecasts (SPWRA)":

UPDATE: "Analyst Roundup: SunPower (SPWRA; SPWRB)"
Previously: "UPDATE: SunPower 4Q Falls 70%; Firm Ends Accounting Probe" (SPWRA; SPWRB)"'
Cowen's Mr. Stone has not been on his game recently. Here's SPWRA compared to the NASDAQ and Claymore’s Global Solar Energy Index (TAN), over the last six months (from BigCharts):

Back on January 15 we posted "Cowen’s Stone Weighs in on Solar Sector - Thinks Stocks Are Oversold on Concerns About German FIT (FSLR; SPWRA; TAN; TSL)". The solar's have dramatically underperformed. He maintained an "Outperform" on FSLR as that stock dropped from $142.66 in mid-December to $98.71 on Feb. 25, 2010.

Here's a Feb. 18 post at SmallCapPulse "Cowen’s Stone Comments on German FiT Reduction - Reiterates Outperform on FLSR, TSL, SPWRA, STRI".
That was preceeded by "Cowen’s Stone Comments on U.S. Utility Scale Solar Segment - OUTPERFORM on FSLR, SPWRA, TSL" on February 8.

Bad calls.

On the other hand Pacific Crest's Mark Bachman:

Oct. 20, 2009
Pacific Crest’s Bachman Says SunPower (Nasdaq:SPWRA) Valuation Appears To Have Peaked

Nov. 17, 2009
Bachman Recommends to Steer Clear of SunPower (Nasdaq:SPWRA) - Accounting Issues

Dec. 1, 2009
Pacific Crest's Bachman on SunPower - Buy Equal Parts SPWRA and Antacid (SPWRA)

It doesn't get much better.
So it is with some trepidation that I go back to Cowen's Mr. Stone (via SmallCapPulse)...

Wheat: "Have we turned the corner in grains?"

Wheat was up for the second consecutive day. From Bloomberg via BusinessWeek:
Wheat Futures Climb as Speculators Unwind Bets on Market Slump

Wheat rose for the second straight day as some speculators unwound bets on a market slump after futures failed to drop below a widely followed price-chart level.

The grain remained above the 10-day moving average of $4.7625 a bushel, supporting prices, said Mike Zuzolo, the president of Global Commodity Analytics in Lafayette, Indiana. Wheat has climbed 5.3 percent this month.

“When we hit the 10-day moving average, it initiated a buy signal,” Zuzolo said. “We may be getting some support from fund short-covering.”>>>MORE

From OptionsExpress:

Is The Bear Market In Wheat Futures Grinding To A Halt?

Fundamentals

Since the beginning of March of 2008, new crop July wheat has been in the midst of a major bear market, as prices have fallen by nearly 60% the past two years, as the all-time high prices reached in 2008 encouraged producers worldwide to increase wheat production. However, now that wheat prices have moved towards more “reasonable” levels, there are some signs that U.S. export demand may begin to increase. U.S. weekly Wheat export sales totaled 323,700 tons for the 2009/10 crop marketing year, which is well above the 117,000 tons needed each week to reach the USDA expected totals for this year. The rise in exports comes despite a rising U.S. Dollar, which would make U.S exports more expensive to foreign buyers. The USDA in its April Supply/Demand report lowered 2009/10 U.S. Wheat ending stocks by 51 million bushels to 950 million bushels. The USDA also lowered world wheat carryout totals by 1 million metric tons to 195.8 million tons. Although the decline in both U.S. and world wheat ending stocks should be viewed as supportive to wheat prices, traders still acknowledge that U.S. wheat ending stocks are at 10-year highs. Large and small speculative accounts are holding net-short positions in Chicago Wheat futures totaling a combined 69,032 contracts, as of March 30th. However this net-short position has begun to decline, as some of the large commodity funds have started to cover their short positions — especially as prices have rallied off contract lows the past several day. However, some analysts believe that any rally in July Wheat futures will be short-lived, as U.S. wheat producers will take advantage of a rise in futures prices to hedge current production ahead of this season’s harvest....MORE

From AgWeb, the headline story:

Have we turned the corner in grains? Or are we still headed down? No, and No. As of today’s close, corn is the least enthusiastic prospective bull, and it is not looking like a bear. Sure, there is no surprise here: we are into the time of year where things get dicey. But don’t you wish there were no surprises in the grain business, or at least no bad surprises? The chart says (and the charts generally know – it has to do with something physicists call self-organizing critical mass feedback loops) corn is undecided but more bullish than bearish.

Another non-surprise is that the bean chart thinks beans are teetering on the edge of a bull market. A week of prices above 984 basis July should do it. That’s not a prediction for $15 prices, but it is a prediction for prices above $11.

This week’s big surprise is wheat. Wheat has been the unloved step child of the group, but is now looking more bullish than corn. On the other hand, unless the world’s wheat supply suddenly collapses, it isn’t clear how we will get much above $6.50 - $7.00 this year, and we may not do that well. One more day of advances will set 470 basis July as the price the bears have to destroy to have any chance to take control of the chart. The bulls will be looking to push prices through 500.

As always, expect two steps forward and one step back until and unless weather gets ugly.

"Chinese Turbines Spun by Texas Winds Spur ‘Buy American’ Push" (APWR; GE: FSLR)

From Bloomberg:

Chinese turbines powered by west Texas winds are sparking a debate over whether “Buy American” rules should be imposed on renewable-energy investments backed by the U.S. government.

A-Power Energy Generation Systems Ltd., based in Shenyang, China, will supply turbines to a joint venture planning to build a $1.5 billion wind farm using equipment made in China. The group, which includes two U.S. partners, says it may seek financial aid from the Obama administration because the project will create at least 1,000 American jobs.

Lawmakers led by U.S. Senator Charles Schumer, a New York Democrat, say such assistance amounts to subsidizing green jobs outside the country. They want to slap made-in-America requirements on renewable-energy initiatives aided by the U.S., like those already faced by highway and water-treatment projects helped by President Barack Obama’s $787 billion economic stimulus plan.

“Congress is feeling pressure to make sure they won’t be held accountable for green jobs going overseas,” said Kevin Book, a managing director for Clearview Energy Partners LLC, a Washington-based policy research firm.

Buy-American restrictions may be added to climate legislation that will be introduced in the Senate as early as next week, Book said.

GE’s View

Producers of renewable-energy equipment, led by General Electric Co., the biggest U.S. maker of wind turbines, say such restrictions would hurt their ability to compete in a global clean-energy market that relies on parts from many countries. Buy-American provisions may cause other nations to retaliate by curbing their use of U.S. products, shrinking domestic job creation tied to exports, GE says.

The wind industry will create 20,000 U.S. jobs in the next decade and would generate more if the U.S. adopted clear policies and incentives for clean energy, such as requiring the use of power generated from renewable sources, said Steve Bolze, head of GE’s power and water unit.

“What the U.S. needs, which Europe, China and other countries have, is stable, long-term policy,” Bolze said in an interview.

Fairfield, Connecticut-based GE, the world’s No. 2 maker of wind turbines after Denmark-based Vestas Wind Systems A/S, is planning to invest 340 million euros ($462 million) in developing and expanding wind-turbine operations in the U.K., Germany, Norway and Sweden, creating a total of more than 2,000 jobs in those countries, Bolze said.

A-Power’s Turbines

“We need to be very, very careful about any kinds of protectionist measures” in clean energy, Commerce Secretary Gary Locke said in an April 8 interview.

The Texas project’s U.S. partners announced the 600- megawatt wind farm in a statement on Oct. 29. A-Power was “designated as the wind-turbine supplier for this high-profile project,” John Lin, the company’s chief operating officer, said in the statement.

The U.S. Renewable Energy Group, a Washington-based private- equity firm, and closely held Cielo Wind Power LP of Austin, Texas, are in the joint venture with Shenyang Power Group, a Chinese energy alliance that has A-Power as its biggest investor.

Schumer criticized the use of Chinese-made turbines at the time, and last month joined Democratic colleagues in introducing legislation that would make the Texas wind farm and projects like it that are dependent on foreign manufacturing ineligible for stimulus aid....MORE

"Analysts on Alcoa: Five Takeaways on The First Earnings Salvo" (AA)

Our last Alcoa piece (of the day).
From MarketBeat:

Here’s a quick rundown some of the thoughts being proffered on Alcoa’s results Monday.

Citigroup: “Heavy truck and trailer sales should bounce 5-10% from 2009 trough levels while beverage can packing will likely be flat YoY. Sales to the commercial building and construction markets should decline ~3% globally, however North America will show much poorer demand trends (-24-31% YoY) as the majority of US government stimulus spending will be focused on highway construction rather than buildings. Industrial gas turbine sales should remain weak (-25- 30% [year-over-year]).”

Bank of America Merrill Lynch: “Key Takeaways: Generally positive impressions. (1) Good margin performance suggests cost cuts are sticking; (2) Commentary on aerospace market indicates high inventories still an overhang in some areas; (3) Alcoa is not looking to change contract pricing structure and delink aluminum/alumina prices; (4) Upcoming labor negotiations in the US this May represent a near term risk; and (5) Macro commentary roughly in line with flat aerospace outlook and negative construction and industrial gas turbine outlooks.”

Goldman Sachs: “Unlike the past three quarters, Alcoa’s results this quarter were largely in line with expectations. While upstream third-party shipments were down from last quarter, we believe much of this can be attributed to a reduction in buy-resell activity (a zeromargin business) and stockpiling ahead of a seasonally strong second quarter....MORE

Previously:

Just a Reminder: JP Morgan Downgraded Alcoa Last Week (AA)

"Alcoa Starts Earnings Season Off With Confusion" (AA)

"No time to worry about CalPERS"

While I am as willing to slam CalPERS, the public employee unions or the weak-tit politicians who kow-tow to them as anyone, I didn't see any urgency in posting "Going For Broke: Reforming California’s Public Employee Pension Systems"
Felix Salmon seems to take the same view. From Reuters:

Well done to CalPERS for responding forcefully to a rather silly Stanford policy brief which gets very alarmist about California’s pension liabilities. There are so many enormous and immediate fiscal problems facing California right now that it seems utterly pointless to put out a paper saying that the state should inject $200 billion into its pension funds — especially when the logic of the paper is as confused as this:

The CalPERS portfolio has had returns averaging 7.91 percent over the last 25 years, with a standard deviation of 11.91 percent. As expected, the high standard deviation means that 68 percent of the time, returns range from –4.0 percent to 19.82 per­ cent. Historically, if CalPERS had simply invested in investment­ grade corporate bonds, the fund could have earned 7.25 percent, only .66 percent less than it has earned with its highly volatile portfolio. This small reduction in earnings would have allowed CalPERS to reduce volatility by a full 7.68 percentage points.

Therefore, in order to avoid future severe underfunded scenarios, we recommend that CalPERS, CalSTRS, and UCRS allocate more of their investment portfolios to fixed income asset classes, thereby reducing risk with a minimal loss of long term investment performance.

I’m not entirely sure where to start on this, but are the Stanford wonks really unaware that the rate of return on fixed-income investments over the past 25 years is largely a function of the fact that interest rates have been declining steadily over that time? And that now they’ve reached zero, they can’t really continue to do so for the next 25 years?

On top of that, the Stanford types seem to think that it makes sense to use a risk-free discount rate to calculate pension-plan liabilities, while even they admit that the assets shouldn’t be invested in a risk-free manner....MORE

We have so many posts on CalPERS I'll show you the quick way to search a site using Google:

site:climateerinvest.blogspot.com climateer calpers

In this case I used both climateer and calpers to reduce the spam-blog links.
Site:URL keyword
Google says 491 posts.

Just a Reminder: JP Morgan Downgraded Alcoa Last Week (AA)

UPDATE: "Analysts on Alcoa: Five Takeaways on The First Earnings Salvo" (AA)"
Original post:
The stock is down 1.24%, giving up yesterday's gain, at $14.39.
A followup to last night's "Alcoa Starts Earnings Season Off With Confusion" (AA)" from one of our favorite sites, Notable Calls:

Friday April 9, 2010

J.P. Morgan downgrades Alcoa (NYSE:AA) to Neutral from Overweight and is removing the stock from their Focus List. Firm's new target is $16.50 (prev. $21.50).

Firm notes their downgrade reflects their new 2011E EPS of $0.48 (which is based on their metal strategist's aluminum price forecast of $0.92/lb) and lower December 2010 price target of $16.50.

Although Alcoa has taken significant costs out of its business by closing high cost operations and through additional procurement and productivity savings, they think it will still struggle to generate attractive returns at JPM's strategist’s
2011 aluminum price forecast of $0.92/lb. While LME aluminum currently sits at $1.04/lb today and the average price for the forward curve in 2011 is roughly $1.11/lb, the firm believes likely weak 1Q results and relatively poor fundamentals for the aluminum market as compared to other metals will encourage investors to gravitate towards companies that have more earnings leverage to their respective metal prices.

Lowering 2010E EPS as headwinds offset rising aluminum prices. JPM is lowering their 1Q10E EPS to $0.04 from $0.18 and 2010E EPS to $0.74 from $1.10. 1Q results should benefit from rising aluminum prices...MORE

...Notablecalls: With J.P. Morgan's Metals team lowering Alcoa estimates just ahead of their earnings release, I think the call warrants attention. Also, their FY11 EPS estimate of $0.48 is now the Street low.

I thought Deutsche's FY011 EPS ests (lowered last week) were as low as they would go here but looks like JPM had other plans.

JPM upgraded Alcoa back in March 2009, so their clients are sitting on sizable gains.

I think AA will get hit on this downgrade. It's a slow mover & the general tape is strong, so you should be able to get decent fills starting from early on.

$14.50? and if that breaks, another 10-20c lower?

"Long-Term Speculator Synthetically Shorts Fannie Mae" (FNM) ABK; AIG

The stock ran yesterday, up 12.73% to $1.24.
It was garbage day at the market, AIG up 8%, Ambac up 104.55% (you read that correctly), MBIA up 5.33%, Freddie up 13.87%
As the penny stock frauds (First Jersey, Stratton Oakmont, Blinder Robinson et al) used to say:

Talkin' trash and makin' cash!!!

From BloggingStocks:

Last Friday, bailed-out mortgage lender Fannie Mae (FNM) was the target of a skeptically skewed options strategy. Around midday, the stock's January 2012 1-strike put and 1-strike call each traded a block of 9,995 contracts, both of which were marked "spread." The put options traded at the ask price, suggesting they were purchased, while the calls changed hands closer to the bid price -- indicating they were sold. Open interest at both strikes surged by roughly 10,000 contracts over the weekend, confirming that all of the contracts involved were newly opened.

By simultaneously buying the January 2012 1-strike puts and selling the January 2012 1-strike calls, this speculator has initiated a synthetic short position on Fannie Mae. The purchase of the long puts will allow the trader to profit from any decline in the share price during the long term.

Meanwhile, the sale of the short calls places this speculator at risk of swallowing heavy losses should FNM rally. If the stock climbs and his calls are assigned, he'll be on the hook to deliver 100 shares per contract at $1 apiece, regardless of what the equity's actual market price might be at the time.

In other words, this option spread effectively mimics the risk/reward profile of a short stock position, without the trader having to go through the extra step of borrowing the shares. (However, unless these calls are hedged by a sufficient amount of FNM stock, the options player will need to maintain a healthy dollar amount in his margin account.)...MORE

Where are the Catastrophe Bond Issuances? (BRK.B; BRK.B)

There is huge capacity in the Re-biz right now. As I said in last week's "Reinsurance Industry Approaches Record Levels" (BRK-B; BRK-A)'":

This is just a bookmark for a piece I had promised and not delivered, divining the insurance industry's thinking on global warming.
I put Berkshire in the title because in addition to being the world's third largest reinsurer they recently upped their stake in #1 ranked* Munich Re to 7.99%.

Berkshire Hathaway also owns 3% of Swiss Re and has 3Billion Swiss francs worth of some yummy 12% notes, convertible at 25CHF i.e. 120Mil. shares, current outstanding 354Mil.; last trade 52.35 CHF.

*Munich Re and Swiss Re have swapped the #1 ranking the last few years. We'll have the final 2009 tally by June....

From BloggingStocks:

Catastrophe bond capacity is maturing, and not much of it is coming back. In the first quarter, $1.8 billion in cat bond risk capital matured, and only $508 million returned in the form of new issuances, according to Thomson Reuters. This quarter, $2.77 billion is maturing, and the absence of first-time issuers makes it unlikely that the market will replace it all. More than a billion of it was from State Farm's Merna Re transaction. The successor to it has already been issued, cleverly named Merna Re II, at only a fraction of the previous bond.

So far, only three cat bonds have closed this year, with The Hartford (HIG) and Swiss Re (SWCEY) joining State Farm. Of course, we're only two weeks into Q2 and Q1 is normally quiet....MORE

See also:
Jan. 6 "Berkshire Hathaway’s Swiss Re Investment Pays Off (BRK.A; SWCEY)"

Feb. 26 "Berkshire Hathaway's "Buffett Picks Insurer Cooperation Over Competition " (BRK-B; BRK-A)":

This is worth keeping an eye on. After a hurricane season with no U.S Atlantic or Gulf landfalls catastrophe bonds scored big and the reinsurers pocketed a bunch of premiums. The state of Florida's decision to self-insure also worked out.

This year may not have as favorable a El Nino/Southern Oscillation, I'll post the latest NOAA advisory after the headline story....

Mar. 5 "Insurance: "El Nino dissipating, but may linger through 2010" (BRK-A; BRK-B)":

Place your bets.
Partly because of the ENSO/Southern Oscillation and partly because of the PDO and Arctic Oscillation we had one February tornado this year, an EF0, reported at 445 PM on 27 February. That follows a hurricane season with no U.S. landfalls....

Mar. 9 "Insurance: " Record warmth in Atlantic Main Development Region for hurricanes" (BRK-A; BRK-B)"

Mar. 10 "No Surprise: Chile Leads to Reinsurance Rate Increase Debate" BRK-A; BRK-B"':

No kidding.
A brisk breeze gets the boys in Omaha, Zurich, Munich and London (Lloyds) talking about premium increases.
Not to mention the herverzekering crowd in Amsterdam, they're tough bastards....

"Alcoa Starts Earnings Season Off With Confusion" (AA)

UPDATE: Here's Bloomberg's take, via BusinessWeek:

Alcoa Loss Narrows as Prices Gain; Sales Trail on Sheet Demand

Original post:
No kidding.The stock is down a dime in late after-hours trade, at $14.47.The headline we went with is from 24/7 Wall Street.

Here are two headlines from different outposts of the Dow Jones empire:

Marketwatch: "Higher aluminum prices help Alcoa trim loss"
MarketBeat : "Alcoa’s Results: A Top Line Whiff"

Here's 24/7:

Alcoa, Inc. (NYSE: AA) is a stock that traders and investors alike try to use as
a proxy for earnings season for the market as a whole and for the metals sector.
Sometimes it cooperates, sometimes not. Either way, it is the first DJIA
component and the first major industrial player to report each earnings season.
The company has started this earnings season off with confusion with a report of
-$0.19 EPS and $4.9 billion in revenues. The loss from continuing operations
does include restructuring and special charges of $295 million or $0.19 EPS, so
some will count this as a positive $0.10 EPS from normalized operations. Thomson
Reuters estimates are $0.10 EPS on $5.24 billion in revenue, which was down
slightly from $0.11 EPS estimates just on Friday on slightly higher revenue
estimates....MORE

"Mining hordes invade Mongolia, the 'Kuwait of Central Asia'" and "Hong Kong a good market for Mongolian IPOs"

A year ago we posted "With a Name Like Inner Mongolia Baotou Steel Rare-Earth Hi-Tech Co., it has to be good ( 600111:Shanghai)":

In December 2007 I wrote:

How the heck did I miss Mongolia Energy Co. Ltd.?...

The question has haunted me to this day.
[you really need to get out more -ed]

MEco was the number two stock in the Bloomberg Worldwide Index that year, up 5911.17%.
I vowed that I "will study and learn, and one day my chance will come."
[ummm, wasn't that Lincoln?]

So when a reader emailed in response to this morning's "China tightens grip on rare earths":

"How do I participate?"

I had the [a -ed] answer.

IMBSREHTco's parent company has world’s largest rare earths deposits.
[the first letters of the acronym are IMBS, tee hee -ed]...

...Here's the extent of my knowledge of Mongolia's fashion scene:

Nomadic chic hairdo
Reconstructed by M.Chimeddorj

From the Mongolia Today article:

Best hairdo, Hun style

Punks, rocks, skin heads... over last decades the world has seen all possible shapes and forms of human haircut. What was in fashion among steppe nomads some 2,000 years ago?

Prof. Bayar's research sheds light into the best hairdos of the past.

Be careful, do your own research. And email if you have editing/trading aspirations.
(requirements/renumeration can be found at "Help Wanted: Trader/Blogger")
[wha? -ed]

Most of our posts have focused on the Rare Earth minerals found in China's Inner Mongolia rather than on Mongolia itself.
Well here we go! First up the Telegraph:

If there was a competition to find the ugliest city on Earth, then the Mongolian capital of Ulan Bator would be the leading contender for the title. The combination of grim, Soviet-style concrete high-rises, rambling slum-shanties and towering coal-fired power plants belching out smoke over the city reeks of the depression and decay that was a legacy of decades of communist rule.

But look more closely and it is clear that change is afoot in this mineral-rich former Soviet acolyte which is on the cusp of a mining boom that has led investors to describe Mongolia as the "Kuwait of Central Asia". The augurs of new wealth are already visible on Ulan Bator's dowdy streets – luxury brands such as Louis Vuitton and Armani have opened branches in the past year, catering to customers in Range Rovers and Porsche Cayennes. And in the city's Grand Khaan Irish Pub the vanguard of the coming investment boom can be found quaffing pints and discussing deals – suited diplomats and investment bankers rubbing shoulders with rough-necked mining engineers and their suspiciously pretty local "girlfriends".

For decades the global resources industry has had its eye on Mongolia's huge mineral deposits – it has world-class reserves of gold, copper, coal, fluorspar, silver, uranium and tungsten – but has been deterred by a combination of corruption and political instability.

That all changed last year, however, with the election of a pro-business Democratic Party government that is now, albeit cautiously, welcoming foreign investors to partake in a boom that the government hopes will triple the nation's GDP in the next decade.

The catalyst for investors was a decision last August by Mongolia's new president, Elbegdorj Tsakhia, to scrap a punitive 68pc windfall tax on copper and gold profits imposed in 2005 by the previous communist-leaning government. Within months the government had also finalised a deal with the Canadian-listed Ivanhoe Mines to develop the $5bn (£3.3bn) Oyu Tolgoi (OT) copper and gold reserve, a Manhattan-sized deposit which will take 60 years to exhaust.

The scale of Mongolia's mineral reserves is mind-boggling, with 15 more OT-sized strategic reserves, according to a research note by Eurasia Capital Management.

The rapid conclusion of the OT deal, which had dragged on for six years under previous governments, has provoked a flurry of activity from both private equity and Chinese, Russian and Singaporean sovereign wealth funds. Mongolia wants to attract $25bn in investment over the next five years to build the roads, railways and new towns needed to exploit its natural wealth.

Market momentum gathered further force this January when Canadian-listed SouthGobi Energy Resources, which mines coal in Mongolia just across the border with China, raised $394m in a secondary listing in Hong Kong. The company had already attracted a $500m investment from China's sovereign wealth fund, the China Investment Corporation (CIC), which itself put $700m into Iron Mining International, a Hong Kong-based mining company with interests in Mongolia.

Masa Igata, CEO of Frontier Securities, which advises Mongolian businesses seeking to raise funds on the international markets, says he expects at least "three or four" Mongolian-based businesses to follow SouthGobi's lead in the next 12 months....MORE

From Reuters (HK) via Mineweb:

Mongolia's prime minister said the Asian bourse is a natural choice for Mongolian companies looking to list

Hong Kong is a natural choice for Mongolian enterprises to go public as the resources-rich country develops its vast untapped mineral wealth, the Mongolian prime minister said on Monday.

Mongolia is attracting attention from global investors after it sealed a deal in October with Ivanhoe Mines (IVN.TO: Quote) and Rio Tinto (RIO.AX: Quote) (RIO.L: Quote) to develop the $3 billion Oyu Tolgoi mine, one of the world's biggest untapped copper and gold deposits.

Now, Mongolia's resources companies -- from coal to copper to iron ore miners -- are actively seeking foreign investors and aim to list shares in markets such as Hong Kong this year.

"Hong Kong is a natural choice for us because of its geographic proximity -- it's the best gateway to trade destinations, such as China," Mongolian Prime Minister Sukhbaatariin Batbold said in a joint event with Hong Kong's stock exchange on Monday.

Batbold said the government would also press ahead with its initiative to privatise many of the country's assets and companies, including coal producers and power plants, with an eye toward creating 'national champions'.

The landlocked country's firms are in need of foreign investment and expertise as they ramp up development, he said.

Mongolia also plans to raise $1 billion-plus via a global bond sale in the fourth quarter this year to fund major development projects in areas such as mining and infrastructure.

"Mongolia is at a very exciting stage of development. We need expertise from investors abroad," said Batbold, who added he will meet Chinese Premier Wen Jiabao on Tuesday to talk about economic ties between the two countries.

"We have this momentum and we need to keep up this momentum.">>>MORE

"Do Smarter Workers Work Less?"

I see no empirical evidense [hah! you wrote 'dense' -ed]
From Economix:

Last week, we summarized a Labor Department report on hours worked and earnings by state, which found that Nevadans work the longest hours and workers in the District of Columbia had the highest hourly wage. Over at The Atlantic, Richard Florida has parsed the data to focus on what makes a state’s labor force more or less likely to work longer weeks and get higher pay.

His result: Education seems to play a big role in how long a state’s average resident works, and for what wage.

In the chart below, Mr. Florida, director of the Martin Prosperity Institute at the University of Toronto, plotted states according to human capital — here defined as what share of their work force had at least a bachelor’s degree — and how much their average worker earned per hour.

Richard Florida and Charlotta Mellander

As you can see, states with more college graduates tended to have higher wages (with a correlation of 0.65). And that’s not all....MORE

Clean Energy Fuels Inc. "T. Boone Pickens' Gassy Stock" (CLNE)

We've been amused/bemused by CLNE and the strange bedfellows it has attracted as investors.
The stock is down 5.7% at $20.78 in early trade.
From Barron's:

Even if the government raises subsidies to the natural-gas industry, shareholders in Clean Energy Fuels don't have much chance of hitting pay dirt. Industry tycoon T. Boone Pickens may get his payday, though.

T. BOONE PICKENS SAYS HE STARTED PROMOTING natural-gas- fueled vehicles back in 1988, hoping to boost the price of his company's natural gas. "I predicted I would do it within three years," says the 81-year-old tycoon. "Now it's 2010."

After 22 years, he thinks it's finally happening. A Pickens-controlled company, Clean Energy Fuels, sells natural gas to trucks and buses at yearly volumes equivalent to 120 million gallons of gasoline. Shares of Clean Energy (ticker: CLNE) have quadrupled within the past 12 months, to around 21. With America's natural gas currently cheaper than OPEC's diesel fuel, Pickens is optimistic that Congress will enact an energy bill that subsidizes the conversion of trucks to natural gas. He's lobbied politicians and the public with his "Pickens Plan" for oil independence: generate electricity with wind and solar power plants, fuel vehicles with the natural gas supplied by the likes of Clean Energy Fuels.

Wall Street has already voted for the Pickens Plan. Clean Energy's $1.3 billion stock-market capitalization values the yet unprofitable venture at 45 times the cash flow that analysts forecast for this year and 20 times the average forecast for 2011 -- about double the multiples of some rival companies. A jubilant end-zone dance like that seems premature. Natural gas clearly merits increased use as truck fuel, in place of the dirtier, more expensive, imported diesel. But after rising 50% since December, the stock price of Clean Energy more than discounts a potential boost in the generous government subsidies that have kept losses at the Seal Beach, Calif.-based enterprise from being even deeper than they are.

If large fleets of trucks eventually roll on natural gas, major oil and gas companies could step in without much trouble and compete away Clean Energy's gross margin -- which is five times the average for gasoline and diesel distributors. Shareholders can expect to get massively diluted, also. To build out its fueling infrastructure, Clean Energy has had a cash-sucking need for capital investment. Management awards itself piles of stock options. Warrants hanging over the company will dilute earnings almost 30%, including a wad that Pickens must exercise before 2012 or lose a profit of $150 million. He can use the money: Most of his shares are pledged to a bank. Clean Energy investors should brace for that 30% haircut.

IN 1996, PICKENS RETIRED FROM his independent energy company, Mesa Petroleum, and from a swashbuckling career as a corporate raider. Since then, he's managed money with uneven results -- and been a generous donor to hospitals, universities and Republican candidates.

He also paid Mesa $1.3 million in 1997 for two natural-gas fueling stations at the airports in Los Angeles and Phoenix. Those stations were the start of Clean Energy Fuels, which now counts more than 200 locations in 23 states. Another 50 stations are in the works, says Andrew Littlefair, who is the company's chief executive and a Pickens colleague since the days at Mesa.

Cities from Los Angeles to Atlantic City are deploying natural- gas-fueled trucks and buses. Commercial trucking fleets are testing the fuel at companies like UPS, Wal-Mart and AT&T. Those are good-sized markets. Municipalities use more than five billion gallons of diesel and gasoline a year to run heavy vehicles, while regional trucking fleets use an estimated 30 billion.

"People are finally figuring out that this thing can and will work," says Littlefair. "The story's not that complicated. It's a low-carbon fuel that's cheaper and works pretty well for the right vehicles."

For many frustrating years, Pickens argued that the right vehicles included cars. Among the 11 million vehicles now running on natural gas worldwide, there are over 60 models of car. Fiat sold more than 140,000 natural-gas-powered cars last year in Italy. But in the U.S., a paltry total of 130,000 vehicles use the fuel, few of them cars. Honda markets the only natural-gas car, the Civic GX, in California and New York.

Gasoline was always cheaper in the U.S. than in Europe. And now, America seems to have picked batteries to replace the gasoline in cars. Natural gas may help generate some of the electricity that powers plug-in electric cars, but the gas will get burned at power stations and the energy distributed through electric wires rather than fueling stations like Clean Energy's.

But 18-wheeler trucks can't run on today's batteries. Vehicles in the heavyweight classes known as Class 5 to Class 8 can carry the large fuel tanks required to cover meaningful miles on compressed natural gas (squeezed at 3,600 pounds per square inch) or liquid natural gas (cooled to minus 160 Celsius). So Pickens and Clean Energy have refined their sales pitch to target the 18-wheelers....

...The Bottom Line

The stock has risen by more than 50% since December, more than pricing in the business' prospects. With dilution looming, the stock is likely to drop at least 30%....MUCH MORE

Previously:

A Bullish Bet on Clean Energy Fuels: Is Nancy Pelosi a Better Derivatives Trader than Hillary Clinton? (CLNE)

No.
If you recall, the Secretary of State ran a grand to $100,000 in a ten month period, October 1978 to July 1979. Newsweek had the best quote: "This is like buying ice skates one day and entering the Olympics a day later," 'says Mark Powers, editor of the Journal of Futures Markets. "She took some extraordinary risks."

The Speaker on the other hand bought her stake in CLNE on the IPO at $12.00, in May 2007.
The stock traded up twenty cents yesterday but was recently at $11.96, down twelve cents on the day and four pennies below the IPO price.
Oh well, maybe this is her trade...

Jim Cramer, Nancy Pelosi and T. Boone Pickens Walk Into a Bar (CLNE)

Nancy Pelosi, Al Gore and T. Boone Pickens Walk Into a Bar (CLNE)

T. Boone Pickens: Greenwashing and Rentseeking (CLNE)

T. Boone Pickens has Wind and Gas (CLNE)

UPDATED: First Solar Looks to CIGS Technology (FSLR)

UPDATE: As soon as I say the stock is looking tired here comes an upgrade.
From Tech Trader Daily:

...Meanwhile, earlier this morning Battle Road Research upgraded shares of First Solar (FSLR) to Buy from Hold and set a $150 price target.

In its note, Battle Road says negative catalysts are in the past and “expectations are too low for 2010.” (First Solar stock is down 9% over the last 12 months, compared with a 49% gain for the Nasdaq.) The stock has been under pressure over concerns about subsidy cuts in Germany, First Solar’s primary market.

More highlights from Battle Road’s note...MORE

Original post:
Duh. It was January 2009 that we posted "First Solar Snags Rival Solyndra’s Top Scientist (FSLR)", Solyndra being the best funded of the CIGS companies.
In late pre-market the stock is trading up six cents at $124.15 and looks tired after the $27.. run up since the last interim low.
From B-Net:

The grass seems to be greener across the thin-film solar fence, at least for First Solar. The company, which is easily the most successful in the solar industry, has a research unit in Silicon Valley working on a competing technology called CIGS, according to Reuters.

CIGS, or copper indium gallium diselenide, is a particular material used for thin-film solar panels. The thin-film industry is an odd one; there are literally dozens of companies working on thin-film, but First Solar, which uses cadmium telluride (CdTe) is the only one to ever meet with any significant success. CIGS companies like Miasole and Nanosolar promised years ago to beat First Solar to pulp, but they’re still eating its dust today.

So why would First Solar want to try its own hand at CIGS, a technology that has frustrated dozens of top researchers? A company official quoted in the Reuters story seems to suggest that First Solar is simply gathering competitive intelligence, but it could likely do that without funding a separate research lab.

An alternate possibility is that First Solar has found the limitations of CdTe — and decided that its competitor’s technology may, in fact, be better. In fact, it’s not really the CIGS companies that First Solar is fighting against. The common foe to anyone in thin-film is the traditional silicon panel made by companies like SunPower and Suntech. Over the past couple years, these have become a serious threat to First Solar’s business....MORE

Previously:

Was Solyndra the Reason Goldman Sachs Threw First Solar Under the Bus? (FSLR; GS; SPWRA)

Goldman Sachs and the Solar Land Rush (FSLR; GS)

Ethanol: "You Can Relax Now--Angostura Bitters Are Back!"

Hoarders to be crushed (or at least muddled).
From 7x7 San Francisco:

Okay, everybody, you can relax now. Your Manhattans and Old Fashioneds are going to be okay. If you didn't know it, we were in the midst of an Angostura bitters shortage due to a strike in Trinidad & Tobago where the stuff is manufactured. People had been worried. Evidently, the US is the world's biggest consumer of Angostura bitters, drinking the equivalent of about 750,000 four-ounce bottles or equivalents annually. I know that Duggan McDonnell, proprietor of Cantina, had gone around the Bay Area, buying up the remaining bottles he could find at Bevmos, in case the shortage was to be prolonged.

Well, we can all breathe a little bit easier now. Neyah White of Nopa blogs "I received the following from Angostura today. Looks like the drought is over." Go here to read the note he got.

Missed it? From the Feb. 12 New York Observer (the shortage actually started in Nov. '09):
Bitter End! Lower East Side Bars Bemoan Dearth of an Essential

Citigroup: "Vikram Pandit’s $350 glass of wine" (C)

From Reuters via Ethiopian Review:

Felix Salmon April 12th, 2010 at 2:03 am

Andrew Ross picks up on this anecdote from Roger Lowenstein’s new book:

The problem of executive pay did not admit to an easy fix. Well into the crisis period, when banks such as Citigroup were operating on federal investment and when Citi’s stock was in single digits, Vikram Pandit, the CEO, was observed with a lunch guest at Le Bernardin, one of the top-rated restaurants in New York. Pandit looked discerningly at the wine list, saw nothing by the glass that appealed, and ordered a $350 bottle so that, as he explained, he could savor “a glass of wine worth drinking.” Pandit drank just one glass; his friend had none.

I have to say I have a grudging admiration for Pandit here. For one thing, this story doesn’t really speak to the issue of executive pay: Pandit made his real money not as an executive but as a part-owner of Old Lane, which got bought by Citigroup for a vastly overinflated sum. Yes, Old Lane was bought largely for the purpose of bringing Pandit into the Citi fold, but that kind of thing is very hard to consider “executive pay”.

What’s more, I’m sure the rest of the bottle hardly went to waste: most likely it was either drunk by the staff or sold off by the glass to people who were very happy to see such a high-end wine available by the glass.

And more generally, you don’t need to be worth tens of millions of dollars to pull a stunt like this. You just need to like good wine with good food, and to decide that in this particular restaurant on this particular day, a goodglass of wine is worth more to you than $350. I can think of people I know earning six-figure salaries (as opposed to seven or eight figures) who are definitely capable of doing this kind of thing.

Of course, it’s also possible that Pandit put the meal on expenses. And you can see the logic: if a $350 bottle of wine would be an acceptable expense normally, it’s silly to polish the bottle off solely to justify the expense of ordering it. The main benefit of ordering a great bottle of wine is to taste the wine inside it; by the time you reach the sixth glass, you’ve already got that benefit, and at that point you’re mainly just getting drunker.

None of which stops the fact that the optics here are terrible. Pandit doesn’t behave this way in public any more, I’m sure — he’s super-alert to any signs of conspicuous consumption at this point. But I wouldn’t be surprised to learn that, in the privacy of his own home, he occasionally does exactly the same thing, and opens up a spectacular bottle only to drink a single glass. It’s a pretty modest vice, by contemporary standards of plutocratic excess.

World's top 100 Mining Companies: Coal, iron ore & platinum rule the roost

From MineWeb:

Demand for mining stocks is strong, and broad, but still relatively selective.

Most stock and commodity indices are at or around 12-month highs; well known exceptions include Greece, Spain and Portugal. China is perhaps a lesser known exception of sorts; there stocks have been tripping along for months with equity investors remaining nervous over changes in domestic policy, and ongoing relative weakness in export markets.

The overall equation is increasingly ameliorated by China's growing internal consumer markets, which continue to grow as a "shock absorber", at least cushioning export demand softness. At the same time, demand in China's real economy remains firm, and continues to drive global demand for most commodities. At this fundamental level, China's economy remains robust, easily retaining its status as epicentre of the world economy.

SELECTED INDICES AND SPOTS
		From	From
	Points	high*	low*
MSCI world equities USD	1213.33	-0.6%	47.2%
MSCI emerging markets USD	1042.99	-0.3%	73.9%
Dow Jones Industrial	10897.52	-0.8%	40.6%
S+P 500	1182.45	-0.8%	45.1%
DJ Stoxx 600	265.87	-1.4%	47.4%
CSI 300	3346.74	-12.0%	36.2%
Shanghai Composite	3118.71	-10.3%	33.7%
Micex Russia	1472.53	-2.2%	79.3%
India Nifty	5304.45	-1.8%	68.4%
Reuters/Jefferies CRB	277.59	-5.5%	29.0%
Dow Jones AIG Commodity	135.09	-6.9%	26.5%
Baltic Dry Shipping	2947.00	-36.8%	101.4%
Baltic Capesize Shipping	3233.00	-60.8%	62.2%
Dollar Index Spot	81.70	-6.0%	10.1%
KBW banks	54.53	-1.7%	98.4%
Gold spot USD/oz	1146.60	-6.5%	32.6%
* 12-month

Among commodity markets, coal and iron ore continue to stand out as exceptional global subsectors. China has long been, and remains, the world's biggest miner of coal and iron ore, but for years has also ranked as a net importer of iron ore, and as of last year, of coal as well. Coking coal, a vital constituent in iron ore reduction, has done particularly well.

BHP Billiton, the world's biggest diversified resources group, and No 1 producer of seaborne coking coal, last month announced that it had settled contracts "with a range of customers throughout Europe, China, India and Japan", without confirming numbers, but probably around USD 200.00/tonne, 55% higher than prevailing contract rates applicable to 31 March 2010.

Coking coal prices rocketed to USD 300.00/tonne for the 2008-2009 season, and were then slashed to USD 129.00/tonne, the contract price applying to the end of last month. In the iron ore arena, seaborne prices have moved up, on a contract basis, to around USD 140.00/tonne, roughly 100% higher that the previous annual contract, and much in line with spot prices. Iron ore contracts have now been shortened from the long-established 12-month term.

Many other commodity and metal prices are running hard, with a good number up around 12-month highs, and some even at multi-year highs. Platinum has been a particular interest of late, underpinning very strong performances among platinum stocks, especially those ranked as well-established producers....MUCH MORE, including price action on the top 100.

"Dick Bove: Investors Betting Goldman Bought Greek CDS" (GS)

'Tis of a piece.
Yesterday the stock closed up $3.14 at $179.50.
From MarketBeat:

Goldman Sachs shares have been on a tear lately. They’re up 8.3% this year, 15% since the end of February and 6% so far this week, after leapfrogging their 200-day moving average on Monday. What’s behind the action?

Rochdale securities analysts Dick Bove says investors have been laying bets on Goldman based on the belief that the company has been snapping up credit default swaps that would pay out in the event of a default of the Hellenic Republic. Brendan Conway of Dow Jones writes:

On Wednesday, Rochdale Securities stock analyst Dick Bove suggested that Goldman may actually end up one of the big beneficiaries if bad turns to worse in Greece....

...Goldman spokesman Michael DuVally said the company “has bought some credit protection, but we are exposed to loss in the event that Greece’s credit worthiness deteriorates.” He declined further comment on Bove’s assessment.

This issue really goes to the heart of Goldman’s public relations challenges at the moment. The pitchfork wielding citizenry sees the fact that Goldman takes positions that are at odds with products it sells as evidence of duplicity. The firm sees it as responsible hedging. And according to Bove, investors see the prospect of Goldman betting big on a Greek default as a potential windfall....MORE

"First Solar Earnings Seen Bottoming in 2Q" (FSLR)

From Barron's Hot Research:

Caris & Co. says shares of the solar firm will continue to rebound.

First Solar (FSLR: Nasdaq)
By Caris & Co. ($126.60, April 8, 2010)

WE ARE ADJUSTING OUR calendar 2010 estimates to reflect a more even impact from Germany in the first half of 2010.

Our fiscal first-quarter 2010 estimates are reduced, but we are increasing our fiscal second-quarter 2010 estimates and the impact to full-year estimate is minimal.

We think solar demand is stabilizing although overcapacity will continue to pressure margins. We think First Solar (ticker: FSLR) earnings will bottom in the second quarter and shares will continue to rebound as earnings growth materializes. We are maintaining our Above Average rating and $147 price target.

We are lowering our above-consensus first-quarter earnings estimates to $550 million, or $1.66 a share, from $600 million, or $1.90 a share, but our calendar 2010 estimates are not significantly impacted. We had expected a very strong impact from Germany in anticipation of the reduction in feed-in tariff.

While the German impact will be strong, we think it will be spread over the first half of the year as the feed-in tariff is unlikely to be changed until the middle of the year. Therefore, while we lower our first-quarter estimates, our second-quarter estimates are increased, and there is minimal impact on our calendar 2010 estimate.

Our new calendar 2010 earnings estimate is $2.8 billion, or $6.22 a share, compared to our earlier estimate of $2.8 billion, or $6.27 a share. There are no changes to our calendar 2011 estimates....MORE

"The top dozen costliest U.S. disasters are ..."

Continuing the insurance/reinsurance theme.
From the Houston Chronicle's SciGuy:

What is perhaps most surprising, however, is how hurricanes dominate the list and that our very own Ike checks in at number four.

Insurance Information Institute

Bear in mind these are just insured values (albeit they are adjusted for inflation). The actual storms caused about twice as much damage.

Can anyone guess why nine of these events have occurred within the last decade?

"Reinsurance Industry Approaches Record Levels" (BRK-B; BRK-A)

This is just a bookmark for a piece I had promised and not delivered, divining the insurance industry's thinking on global warming.
I put Berkshire in the title because in addition to being the world's third largest reinsurer they recently upped their stake in #1 ranked* Munich Re to 7.99%.

Berkshire Hathaway also owns 3% of Swiss Re and has 3Billion Swiss francs worth of some yummy 12% notes, convertible at 25CHF i.e. 120Mil. shares, current outstanding 354Mil.; last trade 52.35 CHF.

*Munich Re and Swiss Re have swapped the #1 ranking the last few years. We'll have the final 2009 tally by June.

From BloggingStocks:

When I started my brief stint in the reinsurance business in late 2007, the words "excess capital" were on everyone's lips. Reinsurers had record capital on hand and were pushing dividends and share buybacks because they couldn't find ways to make it productive. Two years later, we're getting close to those record levels, according to a new report from Aon Benfield (AON), despite everything that's happened in between – the financial crisis, Hurricanes Gustav and Ike and the earthquake in Chile, for example.

If you look at the financials, it's almost like nothing has changed, and let's hope the lessons learned in between aren't obscured by the full pockets that reinsurers can now boast.Global reinsurance capital has reached $396 billion, according to Aon Benfield. The Aon Benfield Aggregate (ABA), a measure of 30 reinsurers from around the world, posted aggregate shareholders equity of $210 billion for last year, up 28% from full-year 2008 and even ahead of 2007 levels. The 30 companies in the ABA are estimated to account for more than 50% of reinsurance capital worldwide.

Gross written premium for the ABA climbed a modest 1% to $133 billion for 2009, and its combined ratio, fell to 90.9% thanks to a lower aggregate loss ratio. This helped push pre-tax profits, for the ABA, from $9 billion to $27 billion....MORE

Chart: "500 Year CRB Index (Annual)"

I can't speak for the scholarship that went into this but just eyeballing, it seems okay with a couple exceptions.
We have wheat and hog stats that go back to the 1300's, this stuff is something that fascinates me.
From The Big Picture:

I love the mere concept of this chart from Jim Bianco — the CRB Index going all the back to the year 1,450:

courtesy of Bianco Research

>

About now, you may be saying to yourself, “How on earth could anyone find this ancient data — and can it possibly be accurate?”

The answers might surprise you:

The chart uses the following series (plotted monthly):

• 1749 to date: The Wholesale Price Index (now called the Producer Price Index) as calculated by the Bureau of Labor Statistics.

• 1749 to 1861: Statistical Tables of Commodity Prices from: Wholesale Commodity Prices in the
United States, 1700 to 1861, by Arthur Harrison Cole (Harvard University Press, 1938)

• 1749 to 1932: The Warren And Pearson Index of Commodity prices in New York, by George F. Warren and Frank A. Pearson (Wiley, 1933)

• 1782 to 1820: Jeavons Index compiled in 1865...MORE

An internal link in our 2008 post "Grain Reserves at 30 Year Lows":

Here's the ten second tutorial on Ag cycles:

The Hog Cycle

No not Harley-Davidson, although I imagine some econ grad student has written the paper.
Wheat and hogs are two commodities with long price series. We mentioned the hog cycle back in January:

The hog price series is one of the longest we have records for, back to the 1200's. The cycle is:
slaughter begets scarcity begets higher prices begets breeding begets over-supply begets slaughter. It's been going on for a while.

Today Professor Mankiw tips us to a government subsidized variation...

"After shorting subprime, Eisman says short AIG" (AIG)

We heartily concur.* The stock has just had a remarkable run-up, although it's down 78 cents at $38.91 today.
From MarketWatch:

Equity holders could lose $23 billion, FrontPoint's Eisman estimates

After making millions of dollars betting against subprime mortgages, Steve Eisman of hedge-fund firm FrontPoint Partners is advising investors to short shares of American International Group Inc., according to a recent presentation.

AIG (AIG 38.95, -0.74, -1.86%) owes roughly $111 billion, even after proceeds from sales of "crown jewels" like Alico and AIA, Eisman wrote in the presentation, a copy of which was obtained by MarketWatch Thursday.

That doesn't include any debt AIG may have to assume from its ILFC aircraft-leasing unit and its AGF consumer-finance business, which have more than $13 billion of debt coming due, he said.

AIG's remaining businesses, which include property- and casualty-insurer Chartis and its domestic life and retirement unit, may be worth about $88 billion, Eisman estimated, while noting there's a lot of uncertainty about this valuation.

That leaves a loss of $23 billion, or $36 a share, for common stock holders of AIG, Eisman calculated.

"AIG has no common shareholder equity remaining on its balance sheet," the hedge-fund manager wrote in the presentation. "It would likely be insolvent if not for government support, in our opinion."

In a better-case scenario, AIG's remaining businesses could be worth $116 billion, Eisman estimated. That would leave equity holders with a gain of roughly $7 billion, or $7 a share, he said, while pointing out that this isn't likely....MORE

*See also:

"At AIG, What Is Left to Sell?" (AIG)

"AIG Gets The Dreaded "Going Concern"

"Greenberg sells AIG stock to UBS for $278 million"

How's That "Short AIG Working Out?" "Back-month bears bet on an extended slide for the insurance issue" (AIG)

As the hearings go on, Secretary Geithner uses the Sergeant Schultz defense and the stock is trading down 20 cents at $24.20.

In our September 1, 2009 post "American Intl Group: Downgraded to Underperform at Sanford Bernstein; $10 target (AIG)" I said:

In early pre-market trade the stock is down $2.23 (4.92%) at $45.33. If SB is correct that leaves some downside, eh?...

We followed up with:

Sep 9
Credit Suisse Analysts on AIG: ‘Little to No Value for Common Equity’
Sep 22
AIG Shares: Still Not Worth Anything.
Nov 30
American International Group: AIG Reserves Deficient - Sanford Bernstein (AIG)
Dec 1
AIG Tangible Common Equity -$162.06 a Share, Analyst Says (AIG)
Dec 4
"Trading Idea: Sell AIG" (AIG)

The stock is trading at $30.51, up 62 cents....

Whether you got the idea in September or December or anywhere in between, you've got a down stock in a (generally) up market.
From Schaeffer's Research (Jan 26):

American International Group (AIG: sentiment, chart, options) – better known as just "AIG" – has been the focus of some fervent put trading today, as investors prepare for a congressional hearing on the insurer's payments of taxpayer funds to large banks. Among those on the roster to testify tomorrow are former U.S. Treasury Secretary Henry Paulson and former chairman of the New York Fed Stephen Friedman.

So far today, the bailed-out behemoth has seen almost 18,000 puts cross the tape – nearly doubling its average single-session volume of fewer than 9,300 puts. Most popular has been the in-the-money February 28 put, which has seen about 3,350 contracts exchanged. However, most of the puts have traded closer to the bid price, indicating they were likely sold, and implied volatility has ebbed 1.9%. In other words, it seems some February 28 put traders may be cashing in on AIG's recent retreat by liquidating their positions.

Meanwhile, the at-the-money March 25 put has seen close to 3,200 contracts change hands – most of which have traded at the ask price, suggesting they were likely bought. What's more, the March 25 strike currently harbors fewer than 450 open put contracts, implying that a healthy portion of today's activity should translate into new positions after the closing bell....MORE

I am continually amazed that Efficient Market Hypothesis is still taught in major business schools.
Especially on the short side, the lag time between financial or economic realities and the market's reaction to same can take months.

The best recent example was back in 2007. The sub-prime mess was being fairly widely discussed in the spring of that year yet the major averages went on to set their highs in early October.

Global macro can be rewarding on so many levels.

Commodities: "Pork Outdoes Gold In The First Quarter"

From Hard Assets Investor:

The hallmark of a solid investment used to be the affirmation that it was "good as gold." In the first quarter of 2010, though, you'd have had the best deal in pork, not the yellow metal.

As fascinating as precious metals may be, the world of hard assets includes a broader pallet of commodities, some more easily forgettable than others. Take that pork, for example. Live hogs, which churned 7.1 percent higher last year, paled in comparison to gold's 24.1 percent advance. In the opening quarter of 2010, though, their roles reversed, as spot hogs jumped 27.5 percent, and gold drifted to a paltry 1.3 percent gain.

Hogs may have been the standout performer in this year's opening stanza, but the competition wasn't particularly fierce. Quite a few individual commodities covered by dedicated or narrowly focused exchange-traded securities were gainers—67 percent (12 of 18) to be exact. Still, by and large, the gains weren't very dramatic, at least when compared with the returns in the hog market.

Here, in no particular order, are the first-quarter spot returns, together with the gains and losses of each commodity's associated exchange-traded security product (ETP):

Metals

Commodity	31-Dec-09 Price	31-Mar-10 Price	Gain/ (Loss)	ETP: Type	ETP Gain/ Loss
CMX Gold	$1,097.80	$1,112.50	1.3%	GLD: GT	1.5%
CMX Silver	$16.910	$17.515	3.6%	SLV: GT	3.6%
NYMX Platinum	$1,476.80	$1,646.20	10.3%	PTM: ETN	7.1%
NYMX Palladium	$407.80	$478.60	17.4%	PALL: GT	6.7%
CMX Copper	$3.3435	$3.5500	6.2%	JJC: ETN	5.5%

Key: GT = Grantor Trust; ETN = Exchange-Traded Note

The slight disparity in returns for the gold products is due to basis. The SPDR Gold Shares Trust (NYSE Arca: GLD) is priced off the London morning fix, which is set six hours ahead of the COMEX gold settlement.

The difference seen in the platinum and copper products, on the other hand, is largely a timing artifact, since the returns for the exchange-traded notes are calculated off their last trade price, not their quarter-ending bids or offers. Often, there can be a considerable disparity between these prices, depending upon the turnover in the exchange-traded securities.

Palladium's differential owes to its novelty. Trading in the ETFS Physical Palladium Shares (NYSE Arca: PALL) only commenced on Jan. 14, so two weeks of parabolic gains have been carved from its record....MORE