Thursday, May 31, 2012

Moody's: "Chesapeake Energy needs to sell $7 billion worth of assets this year to avoid breaching a covenant" (CHK)

From Barron's Stocks to Watch Today blog:

Chesapeake Energy’s $7 Billion Question
Chesapeake Energy (CHK) needs to sell $7 billion worth of assets this year to avoid breaching a covenant in one of its debt agreements, Moody’s analyst Peter Speer writes in a report analyzing the company’s challenges. The oil and gas explorer’s cash flow has declined along with the price of natural gas, Speer notes, and “Chesapeake risks exceeding the 4x Debt/EBITDA limitation in its credit facility in the second half of 2012.”
To get over the hump, the company will have to sell assets quickly:
“Low natural gas prices have reduced Chesapeake Energy”s 2012 cash flow. This trend has left the company more dependent on asset sales to fund the large capital expenditures it will need to continue its transition towards higher liquids production. Chesapeake closed out its natural gas hedges in fall 2011 to fund 2011 capex, leaving it completely exposed to the collapse in natural gas prices in early 2012.”
Chesapeake has proven adept at selling assets in the past, raising “$7 billion in 2010 and $10 billion in 2011 through asset-monetization transactions"...MORE 
Great, the claim to fame is "We know how to hold one heck of a yard sale".
For some reason I find myself thinking of Carl Icahn's TWA light bulb bonds.

Natural Gas: EIA Monthly Production Report--Down 0.4% for March

Even as the drillers go for the higher value natural gas liquids there is still a lot of "after processing" gas coming onto the market.
Here's the latest, from Dow Jones via Fox Business:
Natural-gas output in the Lower 48 U.S. states dropped in March for a second straight month to the lowest level since October, government data released Thursday show.

March output averaged 71.76 billion cubic feet, down 0.4% from a revised February level. The EIA said February output was 72.02 billion cubic feet per day, down from the earlier indication of 72.32 billion cubic feet per day.
March output was 5% above the year-earlier level.

The downward revision for February means demand fell 1% in that month, more than the 0.6% decline indicated earlier. The February drop is the biggest monthly decline since a 1.9% drop in February 2011 when output was hit by a severe cold snap that disrupted some production operations....MORE
From the EIA, May 31, 2012:
The May Natural Gas Monthly, with data through March 2012, has been released. With Henry Hub spot prices in the two dollar range and a mild winter coming to an end, March 2012 gross natural gas production and total consumption further declined from February levels. Daily gross production of natural gas for the Lower 48 States declined slightly from 72.06 billion cubic feet per day (Bcf/d) in February to 71.76 Bcf/d in March. Total consumption of natural gas also continued at historic low levels, with monthly March 2012 total consumption at 2,109 Bcf, a decline of more than 5 percent from the March 2011 level of 2,229 Bcf.  
Details

A New Take on "Death of Equities": The Drudge Headline Indicator

 John Authers, who wrote the May 23 Financial Times story "Markets: Out of Stock" and generated a surprising amount of invective,  followed up with a lesser known companion piece on May 25, "Cult of equities is dead. Long live equities":
You might call it the prayer of all financial commentators: “O Lord, save me from becoming a contrarian indicator.”
Any big pronouncement can be wrong. This is particularly true of markets, which at their extremes are driven by waves of sentiment. The press, often unwittingly, picks up on these waves.

Everyone remembers the book called Dow 36,000, featured by Atlantic Monthly at the top of 2000 tech boom. That predicted the Dow Jones Industrial Average, would hit 36,000. It currently stands at about 12,000. Such hubris obviously portended a fall.

Similarly, most financial journalists are aware of the BusinessWeek cover that proclaimed The Death of Equities – ahead of the great 1982 equity bull market. Of course, it was a buying signal.
So an FT piece that I helped write this week, trailed Death of Equities? on the front page, causes trepidation. Have I just generated a great buying opportunity?
On balance, I think not. There are two issues here; timing, and the broader prospect for the market....MORE

O Lord, save me from becoming a contrarian indicator.

From Bespoke Investment Group:
The Drudge Report, with its 30,000,000 page views per day, is probably the most widely followed news source on the web.  News junkies visit the site on a regular basis to get their daily link fix, while those in the media world -- from the major networks and newspapers to independent bloggers -- go to it multiple times a day.  While political stories receive the majority of the site's links, it's whatever the site's founder Matt Drudge believes to be the most important topic of the day that gets the main headline at the top of the page.

The Drudge Report is not a financial news site, so whenever a financial news story grabs the Drudge headline, it means that the story has crossed over from just a financial news story to a mainstream news story.  And when a financial news story crosses over into the mainstream media, it means that those that don't follow the market on a regular basis are suddenly following the market.  This practically always occurs when the market (or economy, etc.) is going down and not up.

We track every Drudge headline at 9 AM, noon and 4 PM on daily basis going back to 2003 and tally the number of stories that were finance related using the Drudge Report's massive archives service.  We essentially wanted to see how often a financial news story was a front-page headline and not just a Money section headline.  From a contrarian perspective, when financial stories dominate the front-page headlines on a regular basis, it's probably getting close to an inflection point for the market, whether it's a bottom or a top.  (We counted any story that involved the economy or any asset class as a finance related headline.)...MUCH MORE

Gold, Money and Madness (Debunking goldbugs)

Subjects I have more than passing acquaintance with.
Back in September 2008 (remember Sept '08?) I mentioned my experience with Homestake, the largest U.S. gold mine,:
...After the mine closed in 2002 I went out to Lead to answer the question "Is gold an asset you want to own during deflation?" I was quite possibly the last person with access to the company records from the '30's. The skeleton staff that Barrick had in place for the shutdown were literally boxing documents for the archivists as I sat there....
I'll get to money and madness in another post, in the meantime here's FT Alphaville:

Debunking goldbugs
Goldbugs don’t just believe in the fundamentals of gold. They worship at the altar of gold.
The goldbug view represents a market philosophy, a doctrine and a belief-system.
Question it and you incite anger, rage, ridicule.
For ‘non-believers’ this can be frustrating. It’s impossible to have a rational discussion on the subject because goldbugs inevitably intervene with ‘ absolute’ views, none of which are open to adjustment. They stick to those absolutes, even if the facts don’t fit support the narrative.
One might say the following 10 commandments reign at all times:
1) Thou shalt not have any other money than gold.
2) Thou shalt not make paper idol money.
3) Thou shalt not call bullion a relic ever.
4) Remember the day Nixon broke the gold standard.
5) Honour thy gold reserves.
6) Thou shalt not suppress the gold price.
7) Thou shalt not borrow gold from another man.
8) Thou shalt not steal another man’s gold.
9) Thou shalt not bear false witness against gold or talk down gold.
10) Thou shalt not covet another man’s gold.
While FT Alphaville is sympathetic with some of the points raised by goldbugs, we feel what gets in the way of constructive debate is the goldbug’s utter and complete hatred of the so-called paper money system.
Yet the fiat system has a lot more going for it than you might think.

Unlike the gold system, which asks you to put your faith in an inanimate shiny object, a paper “fiat” system asks you to put faith in relationships, in your neighbours, your community. It asks you to believe that society will honour its debts because it doesn’t make sense for it not to — largely because it is just as dependent on you honouring your debts to it, as you are on it honouring its debts to you. It’s a system based on quid pro quo relationships. A symbiosis based on trust....MUCH MORE
Everything is fungible, the question is which is the numerator and which the denominator.

From 2009's "Speculators Turn From Oil To Gold And Copper" which began:
Last Friday I had a comment on the MarketBeat post "Gold Prices: $6,300 by 2065?":
Climateer wrote:
Better gold than oil.
I’ve got no problem with non-consumables being all the rage.
If someone wants to bid 2500 guilders per bulb for their tulips, have at it.
The standard reference for gold is Professor Roy Jastram’s “The Golden Constant” originally published by Wiley.
Here’s a quick overview by Jill Leyland, currently a Vice President of the Royal Statistical Society
http://www.gold.org/assets/file/pub_archive/pdf/GoldCons_Summary_Final3_US_med.pdf
You could’ve done what I did to research the behavior of gold under deflation: head out to the Homestake mine the month Barrick was boxing up HM’s records for the archivists. Since you can’t do that now, the next best thing is the May 1, ‘09 reprinting of Jastram’s classic by Edward Elgar Publishing, updated by the above mentioned Ms. Leyland.
Amazon is sold out, there’s 1 copy being offered on ebay for $176.84.
Today the Wall Street Journal's The Source blog writes:
Something rather odd has happened to all that hot speculative cash that was flowing into oil. It’s drained away and is flooding instead into gold and copper...
Are you quoting rocks per dollar or dollars per rock?

Wells Fargo Seizes Stockton, California City Hall Ahead of Possible City Bankruptcy

Stockton is inland from Vallejo which filed for Chapter 9 protection a few years ago.
From Economic Policy Journal:
The Stockton City Council announced Wednesday that they will look at bankruptcy contingency plans after Wells Fargo seized the new city hall building.

The city paid $35 million to buy the 8-story building, but was not able to move in because of its money problems, and recently stopped making debt payments all together. This is the fourth building that was repossessed by Wells Fargo; the bank seized three city parking garages for the same reason....MORE
A long way from California Dreamin'.

Amazon: The Company Built on Tax Avoidance (the Columbia Journalism Review spanks the Wall Street Journal)

From the CJR's The Audit blog:
Amazon’s California tax squeeze
A WSJ follow story waters down an LAT scoop from two weeks ago
Amazon’s long run of not paying state and local sales taxes is coming to an end as legislatures finally force the Internet retailer to compete on something of a level playing field with everyone else.

But that doesn’t mean the company isn’t trying to squeeze every last drop out of the struggling communities whose infrastructure enables its profits.

The Wall Street Journal reports that the company Jeff Bezos built on tax avoidance has sounded out at least one municipality in California about keeping for itself some of the tax revenue it will be forced to collect from consumers starting next year.

But this is something of a weak effort by the WSJ, which basically shoots down its own thesis in the third paragraph.

The Los Angeles Times’s story, which it broke nearly two weeks ago, was much better. This one from McClatchy’s San Bernardino County Sun—although it came nine days after the LAT’s scoop—also has some key information missing in the WSJ. The LAT reported in its May 19 lede that Amazon is “poised to pocket millions of dollars in sales taxes paid by California customers.”

First, a little background. The Supreme Court ruled in the early 1990s that retailers have to have a physical “nexus” in a state to be forced to collect sales taxes there. Bezos once dreamed of building his company on an Indian reservation in California to avoid having to collect sales taxes and to give his website an unfair advantage over bricks-and-mortar retailers. Bezos later started up in Washington state because it had a relatively small population and would go on to have his employees use special business cards when traveling to California, rather than the normal Amazon.com ones, in case the tax authorities happened to be on the trail.

The LAT reported that San Bernardino “is working on an agreement with Amazon that would give the retailer as much as 80% of its share of sales taxes in the first few years, according to city spokesman Jim Morris,” who ought to be plugged in since he’s the mayor’s son. Morris later told the Sun that “there will likely have to be some sales-tax sharing agreement,” though he later tried to walk back his statement, saying that “it would be incorrect to say the city was actively negotiating a tax-sharing deal.”

The Journal leaves us at the not-actively-negotiating part without noting Morris’s previously published comments....MORE

Zeitgeist: "Bruce Springsteen blasts bankers in Berlin concert"

From the Christian Science Monitor:
The Boss goes off on "greedy thieves" and "robber barons" in fluent German during his Berlin concert. Bruce Springsteen returned to Berlin, where he played a July 1988 concert behind the old Iron Curtain in East Berlin.

Rocker Bruce Springsteen touched on a nerve of widespread discontent with the financiers and bankers at a Berlin concert on Wednesday, railing against them as "greedy thieves" and "robber barons."

Springsteen, a singer-songwriter dubbed "The Boss" who has long championed populist causes, played to a sold-out crowd at Berlin's Olympic Stadium, singing from his album "Wrecking Ball" and speaking about tough economic times that have put people out of work worldwide and led to debt crises in Greece and other countries....MORE

EIA: Natural Gas Into Storage UP 71 Bcf, Slightly Above Estimates

The new front futures have reversed their down-move and are currently up 2.9 cents at $2.447.
Remember, the last expiration rolled up the contango ladder and didn't look back, running from the 2.10 area to 2.75. We don't look for that to happen this go-round but there is some upward pressure from the roll.
From the Energy Information Administration:

Released: May 31, 2012 at 10:30 a.m. (eastern time) for the Week Ending May 25, 2012.
Next Release: June 7, 2012 


Working Gas in Underground Storage, Lower 48
Region Stocks in billion cubic feet (Bcf) Historical Comparisons
05/25/12 05/18/12 Change Year Ago (05/25/11) 5-Year (2007-2011) Average
Stocks (Bcf) % Change Stocks (Bcf) % Change
East
West
Producing
Total



Natural Gas: "Power Plant Gas Use Rose 40% in March, U.S. EIA Report Says" Coal Usage Tumbles

A couple weeks ago we posted "The Amazingly Fast Substitution of Natural Gas for Coal In Electricity Generation":
I've been doing this stuff pretty much my entire adult life and can play the 3D chess game that is energy with some degree of mastery. What we've seen in the electrical utilities over the last six months is unique.

Mental signposts: the switch from biomass to coal supremecy at the start of the Industrial revolution took 75 years and the rise of oil took about 100 years to move coal into second place.

As I said, what we're seeing is unique....
Here's some more evidence via Bloomberg:
U.S. power plants increased natural gas use by 40 percent in March from a year earlier as low prices prompted a switch from coal, the Energy Department said today. Coal’s share fell by 20 percent.

Gas used in electricity generation rose to 703.5 billion cubic feet in March from 503.9 billion a year earlier, the department’s Energy Information Administration said today in its Electric Power Monthly. The increase represents 6.4 billion cubic feet a day of additional gas demand during the month, versus an average daily gain of 5.8 billion in February and 3.6 billion in January.

The shift from coal to natural gas among electric generators was most notable in the Southeast, Central and mid- Atlantic states.

“This trend is likely to persist in the short term as low natural gas prices make natural gas-fired generation more economical,” the department said.

Coal use fell to 57.6 million tons from 72.3 million in March 2011. Supplies “as measured by days of burn were above 80 days for the third straight month in March as declining coal consumption drove coal stockpile increases,” the department said. ...MORE

Noise and Signal — Nassim Taleb

From Farnam Street:
When consuming information, we strive for more signal and less noise. Intuitively we feel like the more information we consume the more signal we receive. While this is probably true on an absolute basis, Nassim Taleb argues in this excerpt from his forthcoming book, Antifragile, that it is not true on a relative basis. He contends that as you consume more data, and the ratio of noise to signal increases, the less you know what’s going on and the more inadvertent trouble you are likely to cause.
* * * * * *
The Institutionalization Of Neuroticism
Imagine someone of the type we call neurotic in common parlance. He is wiry, looks contorted, and speaks with an uneven voice. His necks moves around when he tries to express himself. When he has a small pimple his first reaction is to assume that it is cancerous, that the cancer is of the lethal type, and that it has already spread. His hypochondria is not just in the medical department: he incurs a small setback in business and reacts as if bankruptcy were both near and certain. In the office, he is tuned to every single possible detail, systematically transforming every molehill into a mountain. The last thing you want in life is to be in the same car with him when stuck in traffic on your way to an important appointment. The expression overreact was designed with him in mind: he does not have reactions, just overreactions.

Compare him to someone with the opposite temperament, imperturbable, with the calm under fire that is considered necessary to become a leader, military commander or a mafia godfather. Usually unruffled and immune to small information —they can impress you with their self-control in difficult circumstances. For a sample of a composed, call and pondered voice, listen to interviews of “Sammy the Bull” Salvatore Gravano who was involved in the murder of nineteen people (all competing mobsters). He speaks with minimal effort. In the rare situations when he is angry, unlike with the neurotic fellow, everyone knows it and takes it seriously.

The supply of information to which we are exposed under modernity is transforming humans from the equable second fellow to the neurotic first. For the purpose of our discussion, the second fellow only reacts to real information, the first largely to noise. The difference between the two fellows will show us the difference between noise and signal. Noise is what you are supposed to ignore; signal what you need to heed....MORE

Wednesday, May 30, 2012

Apple's OS X Problem (AAPL)

From xkcd:
http://imgs.xkcd.com/comics/felidae.png

Here are the operating system versions in order of release:
  • 5 Versions
    • 5.1 Public Beta: "Kodiak"
    • 5.2 Version 10.0: "Cheetah"
    • 5.3 Version 10.1: "Puma"
    • 5.4 Version 10.2: "Jaguar"
    • 5.5 Version 10.3: "Panther"
    • 5.6 Version 10.4: "Tiger"
    • 5.7 Version 10.5: "Leopard"
    • 5.8 Version 10.6: "Snow Leopard"
    • 5.9 Version 10.7: "Lion"
    • 5.10 Version 10.8: "Mountain Lion"
 See the problem?

Climateer Line of the Day: Proper Account Titling Edition

From BC Lund's ...Tales of a Margin Clerk post:
...During my first week, I had a college guy tell me he would kill himself if $AAPL didn’t go up tomorrow. He was a 22-year-old college guy who had bet all the tuition money his parents gave him on $AAPL. I immediately told the Supervisor, who looked at me and said, “You think I care? Worse case, it becomes an Estate account. Now, keep calling.” ...
HT: Abnormal Returns

In Other News: "Spain faces 'total emergency' as fear grips markets"

Ambrose Evans-Pritchard has regained his stride and Franco is still dead.
From the Telegraph:
Spain is facing the gravest danger since the end of the Franco dictatorship as the country is frozen out of global capital markets and slides towards an epic showdown with Europe. 

A screen displays the IBEX 35 at Madrid's stock exchange on Wednesday. Photo: AFP
“We’re in a situation of total emergency, the worst crisis we have ever lived through” said ex-premier Felipe Gonzalez, the country’s elder statesman.
The warning came as the yields on Spanish 10-year bonds spiked to 6.7pc, pushing the “risk premium” over German Bunds to a post-euro high of 540 basis points. The IBEX index of stocks in Madrid fell 2.6pc, the lowest since the dotcom bust in 2003.
Chaos over the €23.5bn rescue of crippled lender Bankia has led to the abrupt resignation of central bank governor Miguel Ángel Fernández Ordóñez, who testified to the senate that he had been muzzled to avoid enflaming events as confidence in the country drains away.
Markets are on tenterhooks as Spanish yields test levels that forced the European Central Bank to respond last November with its €1 trillion liquidity blitz. “Nobody is short Spanish debt right now because they are expecting ECB intervention,” said Andrew Roberts, credit chief at RBS. “If it doesn’t come -- if we take out 6.8pc -- we’re going to see a hyberbolic sell-off,” he said.
Italy felt the full brunt of contagion from Spain on Wednesday, with 10-year yileds back near 6pc. The euro fell to a 2-year low of $1.239 against the dollar. Crude oil and metal prices plummeted and save-haven flight pushed rates on 2-year German debt to zero. Gilt yields fell to 1.64pc, the lowest in history....MORE

It's Official, JP Morgan is a Hedge Fund: Sells an Estimated $25 Billion of Profitable Securities to Offset Whale Losses (JPM)

 From our Oct. 26, 2008 post, "Calpers Sells Stock Amid Rout to Raise Cash for Obligations":

This is hedge fund behavior, selling your most liquid investments to prop up the illiquid....
If it walks like a duck...

From CNBC:
JPMorgan Chase has sold an estimated $25 billion of profitable securities in an effort to prop up earnings after suffering trading losses tied to the bank's now-infamous "London Whale," compounding the cost of those trades.

 Chief Executive Jamie Dimon earlier this month said the bank sold corporate bonds and other securities, pocketing $1 billion in gains that will help offset more than $2 billion in losses.

As a result, the bank will not have to report as big an earnings hit for the second quarter.
The sales of profitable securities from elsewhere in the bank's investment portfolio will increase its costs by triggering taxes on the gains and by eliminating future earnings from the securities.

Gains from the sales could provide about 16 cents a share of earnings, about one-fifth of the bank's second-quarter profit, analysts said.

But rather than creating new value for investors, the transactions merely shift gains in securities from one part of the company's financial statements to another....MORE

Rabobank: "Arabica coffee 'most undervalued' soft commodity"

From Agrimoney:
Arabica coffee is "the most undervalued" member of the soft commodities complex, Rabobank said, forecasting a decline in prices of robusta coffee, and downgrading forecasts for cocoa, cotton and sugar futures.
The bank raised its hopes for robusta coffee, the type traded in London, noting the tighter-than-expected supplies of the bean which lifted futures- briefly – to an eight-month high of $2,190 a tonne on Monday.
However, even the raised price outlook foresees a slight decline in robusta values ahead.
Robusta supplies from exporters other than Vietnam, the top grower, shows shipments are tailing off, "will limit prices to the upside", Rabobank said....MORE

Rockefellers and Rothschilds Unite Ahead of Bilderberg 2012 Meeting

Now is the time we juxtapose.
First up, The FT via CNBC:
Two of the best-known business dynasties in Europe and the US will come together after Lord Jacob Rothschild’s listed investment trust and Rockefeller Financial Services agreed to form a strategic partnership.
RIT Capital Partners [RITPF  17.46    0.21  (+1.22%)   ] is to buy a 37 per cent stake in the Rockefeller’s wealth advisory and asset management group for an undisclosed sum, giving Lord Rothschild’s London-listed trust a much sought-after foothold in the US.

The transatlantic union brings together David Rockefeller, 96, and Lord Rothschild, 76—two family patriarchs whose personal relationship spans five decades. 

The Rockefeller group traces its roots back to 1882 when John D. Rockefeller established one of the world’s first family offices dedicated to investing his wealth. It has since developed into a provider of wealth and asset management services to other families, foundations and institutions. It is majority-owned by the 19th century oil magnate’s family and has $34 billion of assets under management....MORE
And from the Guardian:

Bilderberg 2012: the technocrats are rising at this year's annual conference
Our man at Bilderberg is back for a fourth year and has touched down in Chantilly for the 2012 gathering. The shadowy elite leaders' conference starts tomorrow, so what's on the agenda?


Dutch Queen Beatrix arrives at the Bilderberg conference in Stiges, Spain
Dutch Queen Beatrix arrives at the 2011 Bilderberg conference in Sitges, Spain. 
 Photograph: Nero Angelo
It's all change Occupy Bilderberg knocking at the gates.

Everything's set. The hotel is being primped and hoovered, the security is arriving, the press is nowhere to be seen, and I just had a really boring crab salad. It's shaping up to be a vintage Bilderberg.

We were lunching adjacently in the Palm Court restaurant of the Westfields Marriott hotel, in Chantilly, Virginia. A few days from now, this hotel will be dripping with billionaires and bankers, industry CEOs and finance ministers, here for the annual Bilderberg summit. "The leaders of the world are coming to our hotel", beams one member of staff. "Are you here for the brunch?"

We are. Most of the other guests have left by now. The hotel is edging towards lockdown. All that's left is a team of nervy conference organizers who start filming us with their iPhones, several dozen security operatives, me, my wife and a pair of really quite pleasant crab salads. While we brunched, our chatty operative droned on about his "internal and external drivers", about how "I got a panel of three-star admirals together" to secure a "$30m contract" and how "CACI excels in capture management".

He talked fondly of CACI International Inc (a giant defense contractor), although more recently he's had "a nice success rate with Booz Allen" (another giant defense contractor). His world was the deathly dull blur between the federal government and private defense corporations. The grim feeding trough of "systems solutions", "security logistics" and "mission assurance". My crab ended just as he was declaring, wisely: "When you leave the navy and you go to a contractor, you say: what's my mission?"

His mission for the next week or so is to keep the queen of the Netherlands, the chairman of Barclays, and the chairman, vice-chairman and CEO of Shell Oil safe and sound for a three-day conference. The hotel is encircled by the offices of the world's largest arms' manufacturers, 15 minutes up the road from the headquarters of the CIA...MORE

Our Worst Call of the Year and How Tight Stops Can Save the Day (XHB, ITB)

When a position goes against you it either means your thesis is wrong or your timing is wrong.
In either case the operative word is wrong.
Last August I tried to drive the point home in "Lincoln on Bank of America (BAC)":
Embrace your losses.
Booking your losses should be a joyful thing.
The first loss is the best....aw screw it. 

Tight stops give you the opportunity to look like a moron but if an individual or a firm is to survive, you must avoid the cat lady syndrome (you've heard it every time the guys in the biohazard suits are called in):
"It started with just three but then, well. it kind of got away from me" 


The only way to prevent losses from getting away from you is to close the trade one penny above the level you've given yourself. If you are indecisive or if your ego is so childish that it won't allow you to recognize a loss you have to ask yourself what the heck you're trying to accomplish....
The market philosopher, Patty Smyth describes the appropriate weltanschauung:


One of the masters of the Chicago pits, Everett Klipp, said, in our in memorium post:
Climateer Line of the Day: "Babe Ruth of the CBOT" Edition
"Mr. Morris told me anytime you can take a loss, do it. and you'll always be at the [CBOT]," Klipp says, "I lost money that first day and kept losing until I retired in 1998." 
If you have the time that entire post is worth the read.
The point was the basis of a very large fortune early 19th century fortune:
HOW THE RICHEST ECONOMIST IN HISTORY GOT THAT WAY
...Ricardo’s Golden Rules Of Investing
Ricardo never wrote down his trading techniques, but business associates said that he held scrupulously to his two “golden rules”: “Cut short your losses” and “Let your profits run on.” He also took advantage of undervalued and overvalued situations, based on the observation that the investing public often exaggerates events, and he may at times have engineered these overbought and oversold conditions, as noted above....
Now back to the headline story.

On March 31 we posted "Lumber Says This Is A Top For Housing Stocks" (ITB; XHB) which we reiterated in "Follow up to ""Lumber Says This Is A Top For Housing Stocks" (ITB; XHB)" on April 1

It worked for a couple weeks and then it really, really didn't work, ITB and XHB are homebuilder ETF's:

 Via Yahoo:

Chart foriShares Dow Jones US Home Construction (ITB)

We got stopped out and I forgot about the trade until I saw this chart at Abnormal Returns.

Lumber 0512 624x310 Tuesday links:  uncommon ownership
Have you checked out lumber prices this year?  (WSJ)

Tight stops. They allow you to forget the losers.

A Look at Options on Facebook Common (FB)

Sometime headline writing is challenging.
If I had gone with a simple "Facebook Options" folks might think we were talking about the Facebook phone or the Facebook browser, charging for Facebook in New Zealand or Zuckerberg's $0.00 tip on a $40 tab.

So I ask myself  "What would Henry Blodget do?" and  instead I use a clumsy locution to avoid a bait-and-switch.
In pre-market action the stock is down a few pennies at $28.77.
First up, Barron's:

Bears Draw Blood on Facebook's First Options Trading Day
As the stock for the first time dipped below $30 midday Tuesday, options investors are betting it can fall further.
Facebook's stock now has something in common with Mark Zuckerberg, the company's founder.
Both are under 30.

And it appears that option investors think that the stock can sink further.
Almost from the moment the options on Facebook began trading for the first time Tuesday morning, investors actively bought puts that would increase in value should Facebook (ticker: FB) fall below $30, which it did by noon.

Scores of likely scorned stock investors bought puts that were at, or just below, $30, which they financed by selling bullish calls. In essence, the sophisticated strategy offers one of the first signs from Wall Street that Facebook's botched stock offering has painted a target on Facebook's stock that bearish traders want to fire away at.

In the New York Stock Exchange's options market, for example, the day's first trade entailed selling 743 June 32 calls, and selling 743 June 30 puts. The strategy -- a short strangle -- indicates that a sophisticated investor believes Facebook's stock will remain under significant short-term pressure and slip below $30.
At 28, which also happens to be Zuckerberg's age, the strangle seller indicated he would buy the stock. At that price, Facebook's stock would be 26% below the $38 price the stock was priced at for its initial public offering.

The bulk of Facebook's trading action is occurring in options that expire in June and July, which telegraphs another important message to stock investors from the options market. No one is willing to make a long-term bets on the stock even though they can buy or sell Facebook options that expire in January 2014.
By focusing on options that expire by July 20, investors are expressing a view that they do not have any confidence pricing Facebook's stock....MORE
And from Option Pit:
A Breakdown of the New Facebook Options
I promise this will be one of the only Facebook options posts I put up over the next few weeks.  However, I wanted to make sure that I pointed out a few interesting tidbits about options on facebook that, maybe, the average retail trader might not have noticed.  Stuff everyone should know before reading the rest of this piece:

Facebook options started at an implied volatility below 60% this morning, while the realized volatility has been closer to 100% in its first week of trading.  What does that say about facebook?  Not much.  The stock is so new, and has been beaten down on its open, that we really don’t know what the volatility will be.  My guess though,  the stock is going to slow down its free fall, and the volatility will settle in closer to GOOG levels (around 30%)  than to ZNGA levels (near 85%).

The stock is also hard to borrow right now.  While that was likely more of a problem with the stock at 33 than 29, as long as the borrow is hard, the stock will have problems.  Keep an eye on that.  I think the HTB tag goes away around 26-28 dollars a share as the easy money leaves.

In terms of skew:
skre.JPG
Livevol (r) www.livevol.com

As one might expect, the skew is a standard investment skew, with puts seemingly expensive due to the rate of decline.  On the other hand, calls seems pretty flat (this could set up well for a bullish fly if/when the stock gets a bounce).  It also sets up well for front spreads.

Finally, and most interesting is the term structure.

fb.jpg
Livevol (r) www.livevol.com

Notice that June is super bid while July is much cheaper.  This implies that there is high demand for gamma in the near term.  August is over July as well, as that is an earnings month....MORE

"Spain Ejects Clean-Power Industry With Europe Precedent"

A few years ago Spain was so flush they were paying, without questions, subsidies to a developer who claimed to be generating electricity at night.
With solar.
Good times.
From Bloomberg:
Spanish renewable-energy companies that once got Europe’s biggest subsidies are deserting the nation after the government shut off aid, pushing project developers and equipment-makers to work abroad or perish.
From wind-turbine maker Gamesa Corp. Tecnologica SA (GAM) to solar park developer T-Solar Global SA, companies are locked out of their home market for new business. These are the same suppliers that spearheaded more than $69 billion of wind and solar projects since 2004 that today supply more than 50 percent of Spain’s power demand on the most breezy and sunny days.

Saddled with a budget deficit more than twice the European Union limit and a ballooning gap between income and costs in its power system, Spain halted subsidies for new renewable-energy projects in January. The surprise move by Prime Minister Mariano Rajoy one month after taking office helped pierce investor confidence in stable aid for clean energy across Europe.

“They destroyed the Spanish market overnight with the moratorium,” European Wind Energy Association Chief Executive Officer Christian Kjaer said in an interview. “The wider implication of this is that if Spanish politicians can do that, probably most European politicians can do that.”

Spain’s $69 billion of investment in power capacity from 2004 to 2011 was about triple the spending per capita in the U.S. in that period, according to Bloomberg New Energy Finance data and U.S. Census Bureau population estimates. Most of the 2012-2013 spending will be for the legacy of projects approved before the aid cuts to wind, solar, biomass and co-generation....MORE

Tuesday, May 29, 2012

"Holy Cow! India Is the World's Top Beef Exporter"

I thought Holy Cow was just a term used by Harry Caray, FT Alphaville and yours truly.*
From the Atlantic:
India, homeland of the sacred cow, is on pace to become the world's leading beef exporter in 2012.

This graph is based off data from the USDA's Foreign Agricultural Service. It forecasts that India, shown in blue, will be ship roughly 1.5 million metric tons of beef, passing reigning export champion Australia. It's a remarkable rise from just three years ago, when the famously bovine-friendly country exported less than half that amount. 
India_Leads_Beef_Exports.PNG
Here's how this has come to pass. Indian beef isn't really beef as we Americans know it. It's water buffalo, which the country's exporters sell at low cost to the meat-hungry but price-sensitive consumers in the Middle East, North Africa, and Southeast Asia....MORE
*
May 8, 2009  
MarketWatch's Trading Strategies Special Report
When this part of the Dow Jones empire gets the team to write about the markets, the result is, to quote Harry Caray:
It might be . . . it could be . . . it IS! A home run! Holy cow!
March 5, 2012 
"Time for position limits on Vix futures?" (TVIX; UVXY; VXX)
From FT Alphaville:

Holy cow! Index Universe – self-described defenders of the ETF industry — have admitted there may be an issue with these products affecting the underlying assets, after all....
"Here’s a cow in Bangalore who’s obviously in the mood to chill. Some people criticize him for not being able to read, and others reckon it was him who painted that message there in the first place, just to reserve this spot when he needs it. "

Holy cow (Bangalore)

Cary swiped the phrase from Halsey Hall, see:
Thornley, S. (1991), Holy Cow! the Life and Times of Halsey Hall, Nodin Press

Oil India, With $1.3 Bil. For Acquisitions, to Consider "Governance" Before Dealing With Chesapeake (CHK)

Ouch.
From Bloomberg:
Oil India Ltd. (OINL), armed with as much as $1.3 billion of cash for acquisitions, will consider Chesapeake Energy Corp. (CHK)’s “corporate governance issues” before investing in the explorer’s shale assets in the U.S.

“We would certainly have to consider Chesapeake’s corporate governance issue,” Finance Director T.K. Ananth Kumar told reporters in New Delhi yesterday. “Investing in their assets is one of the opportunities we’re looking at for investments in the U.S.”

Chesapeake, the second-largest U.S. natural-gas producer, plans to sell as much as $14 billion in assets this year. Plummeting natural gas prices and revelations that Chief Executive Officer Aubrey McClendon used personal stakes in the company’s wells to obtain more than $800 million in private loans have resulted in the explorer losing almost half of its market value in the past year.
Some directors from Oil India met officials from Chesapeake in Oklahoma City, where the company is based, this month, Ananth Kumar said. Discussions to invest in the U.S. company’s assets are preliminary and one among other opportunities, he said....MORE

Has The Swiss National Bank Restarted The Printing Press? (EUR/CHF)

From ZeroHedge:
Huge rise in Currency Reserves: The SNB has restarted the printing press
The game for the Swiss National Bank seems to have changed completely. Again the central bank had increase money supply, as measured by deposits at the SNB by local banks and by the Swiss confederation, this time even by 13219 mil. francs (source). This money printing implies that the SNB had to buy in Euros in similar quantities in order maintain the floor.


Already last week the central bank had to shift its strategy from selling Euros to buying Euros. The SNB managed to reduce money by 35446 mil. (i.e. sell mostly euros) between Sep 9, 2011 and May 11, 2012. In the last two week it had to increase money supply by nearly 17000 mil. CHF, loosing nearly 50% of all "gains" in the previous money supply reduction.

We have speculated that the SNB will double or triple the Forex reserves before it gives in and the floor will break.

At the current speed of 13 bln per week, this will result in 676 bln. CHF per year, i.e. they will have tripled money supply and currency reserves in one year. This sum exceeds slightly the Swiss GDP, implying that a break of the floor from 1.20 to 1.10 (about 10%) on the basis of 50% Euros in the SNB reserves would result in a loss of around 5% of GDP at the central bank. Moreover, in the week ending in May 25th, nothing really extraordinary happened, what would happen in case of a Greek euro exit?...MORE

Heads-up: "Hedgies Pile Into Long Bonds"

From MarketBeat:
A bit of a red flag here, spotlighted by Bank of America Merrill Lynch analysts in their weekly Hedge Fund Monitor note. It seems that the fast money crowd has been piling into 30-year Treasury bond futures lately. As diehard market geeks know, the 30-year bond sees the biggest price changes based on relatively small changes in interest rates. So buying the long bond is one of the most effective ways to bet on a drop in interest rates.

And that’s what hedge funds have been doing lately, BofA Merrill analysts write, citing the weekly Commitment of Traders report issued every Friday by the Commodities Futures Trading Commission....MORE

Facebook Drops Below $30; Shares Still A Sell, Says S&P Capital IQ (FB)

Last I saw it was trading at $29.47.
From Eric Savitz at Forbes:
S&P Capital IQ analyst Scott Kessler this morning reported his Sell rating on Facebook shares, amid a flurry of reports about the company’s plans to strengthen its position in the mobile sector.

Kessler notes that in addition to reports that the company may be interested in buying Opera – see my post on the rumor from earlier this morning – there is also chatter that the company is planning to build its own smartphone. The analyst says both stories are “plausible,” which is not to say he thinks the developments support a bullish case on the stock....MORE

"Sizzling natural gas may be summer fizzle"

The front futures are down 4.3 cents at $2.525.
Two caveats to our dour outlook for natty:

1) The weather. The 90-day forecasts are for slightly above average temperatures but lower than last year.
If we should catch a couple heat waves injections into storage will be lower. The location of the heat is also imortant. If it is in Phoenix, meh. If it is over the NYMEX and the gas traders break a sweat they'll bid the stuff up.

2) Depletion rates. We're hearing from lessors that their royalty payments from wells drilled two years ago are reflecting declining production on the order of 50-70%. this is partly due to the nature of shale and partly due to what happens to the fracking compounds over time.
Because this stuff is so new no one has exact numbers on what total production and production rates will end up at.
More on this in a couple weeks.

A third possible concern is that at $2.749 we saw electric utilities delaying conversion from or actually converting back to coal.
We'll post on this tomorrow.

From MarketWatch:
Prices have risen 35% from their year lows, but some see top
A double-digit pop for natural-gas futures puts them among May’s best performing investments, but for the notoriously volatile and weather-dependant commodity, timing is always the trickiest part.
Natural gas slipped under $2 per million British thermal units in April, to its lowest in a decade. It has gained 35% from those levels, to over $2.50 per million BTUs. 

It will likely be “very tough to rally from here,” said Subash Chandra, a managing director at Jefferies in New York who follows the natural-gas market. 

Prices often rise and fall with weather expectations, as natural gas-fired power plants demand more of the product in the winter and summer. 

A warmer winter and plentiful production pushed prices from as high as $3.65 per million Btus in early December to the below $2, worst-since-2002 prices in April. Prices bottomed for the year at $1.91 per million Btus on April 19. 

Recent expectations of a warmer-than-normal summer in the U.S. and some concerns about supplies have pushed prices higher again, although year-to-date prices have plenty of catching up to do. 

Natural gas futures are off 14% so far in 2012, and off 43% from the year ago. For the month, however, prices have gained 12%, with June natural gas NGM12 -4.35%  closing Friday’s session at $2.57 per million Btus. 

United States Natural Gas Fund UNG -0.55% , an exchange-traded fund designed to track natural gas prices, has rebounded 11% this month but is still off 30% this year. 
The latest gains for natural gas were predicated on warmer days in spring signaling the warmer summer and as some power plants switched to natural gas from coal....MORE
See also:
Friday's "Natural Gas Rig Count FALLS by 6 to 594" and May 17ths "The Amazingly Fast Substitution of Natural Gas for Coal In Electricity Generation"

Follow-up: Choosing the Charlatan Career Path

That was quick.
Following up on "Are You a Recent Graduate Who Hasn't Found a Job? Consider Becoming a Charlatan",
A reader emails (via Dilbert.com):

August 22, 2009

UPDATED--Are You a Recent Graduate Who Hasn't Found a Job? Consider Becoming a Charlatan

Update: "Follow-up: Choosing the Charlatan Career Path".
Original post:
A field of human endeavor we have studied [some would say participated in -ed] for many years, links after the jump.
From the Stumbling and Mumbling blog:

The strong demand for charlatans
In the improbable event of ever being invited to give a commencement address, my advice to graduates wanting a lucrative career would be: become a charlatan. There has always been a strong demand for witchdoctors, seers, quacks, pundits, mediums, tipsters and forecasters. A nice new paper by Nattavudh Powdthavee and Yohanes Riyanto shows how quickly such demand arises.

They got students in Thailand and Singapore to bet upon a series of five tosses of a fair coin. They were given five numbered envelopes, each of which contained a prediction for the numbered toss. Before the relevant toss, they could pay to see the prediction. After the toss, they could freely see the prediction.

The predictions were organized in such a way that after the first toss half the subjects saw an incorrect prediction and half a correct one, after the second toss a quarter saw two correct predictions, and so on. The set-up is similar to Derren Brown's The System, which gave people randomly-generated tips on horses, with a few people receiving a series of correct tips.

And here's the thing. Subjects who saw just two correct predictions were 15 percentage points more likely to buy a prediction for the third toss than subjects who got a right and wrong prediction in the earlier rounds. Subjects who saw four successive correct tips were 28 percentage points more likely to buy the prediction for the fifth round....MORE

The old stock market newsletter scam was to buy a list of names and tell half the people the market would be up and half that it would be down. Do that with a 10,000 name mailing list, cull the ones you were wrong on, rinse and repeat a couple more times and you have 1250 people who think you've been right three times in a row.

What would they be willing to pay for your fourth hot call?

As an example, targeting high net worth individuals, some of the scamsters would sell a subscription to the "Bull" Report or the "Bear" Report for 500 dollars. If a quarter of the final winnowing bought the take was $156,000 which was real money in say 1955, a time when median family income was $4,400 and a postage stamp cost 3 cents.

Previously: 

...when people feel they lack of control in life, they experience sudden increases in “invisible pattern-seeing." "People primed with a sense of powerlessness saw more images in static, found more conspiracies in written stories, and imagined more patterns in financial markets than those who were left alone," Lafsky writes....
That effect is something you must always be on guard against and not just in the markets. I get crabby when folks think they can read my mind. My thinking isn't that transparent. (is it?)
Last week MarketBeat posted "Written in the Stars" wherein somebody I've never heard of says the market would bottom today:
...Panic lows have historically occurred on day 27/28 of the 7th lunar cycle, which are this Sunday and Monday. The panics of 1857/1907/1929/1987/1997 all marked their lows on these days in October!”...
There is a long history of this stuff, everybody wants to know the future.
One of my favorite examples comes from a "American Experience" episode, "The crash of 1929"
(we linked to it in reference to Joe Kennedy's pool manipulation of RCA)*
1929 February: Astrologer Evangeline Adams, who counts Charlie Chaplin, Mary Pickford, and J. P. Morgan among her clients, predicts the market will rise in the coming months.
This is contradicted by her comment:
"In 1928 and 1929... it behooves everyone to be extremely cautious in investment and money matters, and be prepared for this threatening configuration of planets". The stock market crash occurred in October of 1929.
Or it may just be an earlier version of the Cramer technique.
Ms. Adams was reputed to call the crash later that year based on the horoscope of Mr. Morgan's son Henry Sturgis (founder of Morgan Stanley).... 
"S.E.C. Charges Psychic With Securities Fraud"
Should have seen it coming.

"Moonstruck: Lunar Cycle Says Expect Market Rally"

...“Under these conditions,” he continued, “the cerebral cortex cedes much behavioral control to the primitive basal ganglia—wherein neural voltages matter more than earnings and interest rates.”...MORE
Roger that, roving ganglia gangsta gangs ganging up on cortex, over.

You'll notice he uses his middle name. 
That's so you don't confuse him with the charlatan Paul Montgomery.
See also:
Technical analysis
Fundamental analysis
Divination for Dummies
Pitfalls in Prognostication: Fortune Magazine's August, 2000 "Ten Stocks to Last the Decade"

FX "Switzerland Makes Plans for the End of the Euro"

From the Wall Street Journal:
Switzerland is considering capital controls to fight a sharp rise in the Swiss franc in the event of a euro-zone collapse. Dow Jones's Katie Martin explains why investors run to it in times of trouble and why this is bad news for the Swiss.
Article

 

Friday, May 25, 2012

Memorial Day 2012



Fort Snelling National Cemetary
"...that from these honored dead we take increased devotion to that cause for which they gave the last full measure of devotion--that we here highly resolve that these dead shall not have died in vain, that this nation under God shall have a new birth of freedom, and that government of the people, by the people, for the people shall not perish from the earth." 
-Abraham Lincoln
at Gettysburg,  November 19, 1863

Carl Icahn Files a Bunch of 13D's, Owns 7.56% of Chesapeake Energy, Would Like the Board to Leave (CHK)

Ha!
And Ha again!
Following up on May 14ths "Dear Chesapeake Energy, My Name is Carl Icahn... (CHK)" we have Deal Journal:
Dear Chesapeake: I’m Back. Love, Carl Icahn
Chesapeake Energy CEO Aubrey McClendon said a few weeks ago that Carl Icahn made a lot of money during his time as a Chesapeake shareholder in 2010 and even called to say “thanks” when he cashed out.  Icahn’s version is less sanguine.

In a scathing letter announcing he has acquired a 7.5% stake in Chesapeake, Icahn says he cashed out last time around because the company abandoned promises of frugality in favor of a buying spree.

“Recognizing this fundamental problem with the board, we sold our position,” Icahn wrote. “That decision turned out to be particularly prescient.”...MORE
In yesterday's "Icahn, BlackRock Bullish on Chesapeake; Shares Rise" (CHK) we ended with:
...As of a couple minutes ago Mr. Icahn has not crossed the filing threshold . Maybe it's planned for Friday evening ahead of the long weekend.
Here are the 13D's, accepted at the IRS  2012-05-25 15:56:59

At Friday's close the stock was at $15.81, up 1.48% and got to $16.10 in afterhours action.
The trades covered by the filings:

(c) The following table sets forth all transactions with respect to Shares effected during the past sixty (60) days by any of the Reporting Persons, inclusive of any transactions effected through 4:00 p.m., New York City time, on May 25, 2012. Except as otherwise noted below, all such transactions were purchases of Shares effected in the open market, and the table includes commissions paid in per share prices.

Name of Reporting Person
Date of Transaction
Amount of Securities
Price Per Share
High River LP
4/19/2012
200,000
18.03
High River LP
4/23/2012
567,498
17.64
High River LP
4/24/2012
232,502
17.90
High River LP
4/27/2012
252,556
17.56
High River LP
4/30/2012
157,366
17.68
High River LP
5/7/2012
9,216
16.75
High River LP
5/8/2012
117,480
16.73
High River LP
5/16/2012
1,720,000
14.60
High River LP
5/2/2012
1,781,775
17.22
High River LP
5/3/2012
503,326
17.10
High River LP
5/4/2012
289,802
17.37
High River LP
5/15/2012
600,000
14.60
High River LP
5/17/2012
180,000
13.60
High River LP
05/18/2012
1,126,879
14.12
High River LP
05/21/2012
404,063
14.67
High River LP
05/22/2012
183,790
14.74
High River LP
05/23/2012
1,054,729
14.53
High River LP
05/24/2012
636,060
14.82
       
Icahn Partners LP
4/19/2012
311,317
18.03
Icahn Partners LP
4/23/2012
883,358
17.64
Icahn Partners LP
4/24/2012
361,908
17.90
Icahn Partners LP
4/27/2012
393,124
17.56
Icahn Partners LP
4/30/2012
244,953
17.68
Icahn Partners LP
5/7/2012
13,610
16.75
Icahn Partners LP
5/8/2012
173,490
16.73
Icahn Partners LP
5/16/2012
2,540,018
14.60
Icahn Partners LP
5/2/2012
2,518,695
17.22
Icahn Partners LP
5/3/2012
743,289
17.10
Icahn Partners LP
5/4/2012
427,963
17.37
Icahn Partners LP
5/15/2012
886,054
14.60
Icahn Partners LP
5/17/2012
265,816
13.60
Icahn Partners LP
05/18/2012
1,664,125
14.12
Icahn Partners LP
05/21/2012
596,703
14.67
Icahn Partners LP
05/22/2012
271,412
14.74
Icahn Partners LP
05/23/2012
1,557,577
14.53
Icahn Partners LP
05/24/2012
939,305
14.82
       
Icahn Partners Master Fund LP
4/19/2012
325,759
18.03
Icahn Partners Master Fund LP
4/23/2012
924,337
17.64
Icahn Partners Master Fund LP
4/24/2012
378,698
17.90
Icahn Partners Master Fund LP
4/27/2012
411,361
17.56
Icahn Partners Master Fund LP
4/30/2012
256,316
17.68
Icahn Partners Master Fund LP
5/7/2012
14,407
16.75
Icahn Partners Master Fund LP
5/8/2012
183,671
16.73
Icahn Partners Master Fund LP
5/16/2012
2,689,083
14.60
Icahn Partners Master Fund LP
5/2/2012
2,693,489
17.22
Icahn Partners Master Fund LP
5/3/2012
786,910
17.10
Icahn Partners Master Fund LP
5/4/2012
453,082
17.37
Icahn Partners Master Fund LP
5/15/2012
938,053
14.60
Icahn Partners Master Fund LP
5/17/2012
281,415
13.60
Icahn Partners Master Fund LP
05/18/2012
1,761,785
14.12
Icahn Partners Master Fund LP
05/21/2012
631,720
14.67
Icahn Partners Master Fund LP
05/22/2012
287,340
14.74
Icahn Partners Master Fund LP
05/23/2012
1,648,984
14.53
Icahn Partners Master Fund LP
05/24/2012
994,430
14.82
       
Icahn Partners Master Fund II L.P.
4/19/2012
113,036
18.03
Icahn Partners Master Fund II L.P.
4/23/2012
320,738
17.64
Icahn Partners Master Fund II L.P.
4/24/2012
131,405
17.90
Icahn Partners Master Fund II L.P.
4/27/2012
142,739
17.56
Icahn Partners Master Fund II L.P.
4/30/2012
88,938
17.68
Icahn Partners Master Fund II L.P.
5/7/2012
6,136
16.75
Icahn Partners Master Fund II L.P.
5/8/2012
78,234
16.73
Icahn Partners Master Fund II L.P.
5/16/2012
1,145,384
14.60
Icahn Partners Master Fund II L.P.
5/2/2012
1,328,560
17.22
Icahn Partners Master Fund II L.P.
5/3/2012
335,174
17.10
Icahn Partners Master Fund II L.P.
5/4/2012
192,986
17.37
Icahn Partners Master Fund II L.P.
5/15/2012
399,551
14.60
Icahn Partners Master Fund II L.P.
5/17/2012
119,866
13.60
Icahn Partners Master Fund II L.P.
05/18/2012
750,413
14.12
Icahn Partners Master Fund II L.P.
05/21/2012
269,072
14.67
Icahn Partners Master Fund II L.P.
05/22/2012
122,390
14.74
Icahn Partners Master Fund II L.P.
05/24/2012
423,564
14.82
       
Icahn Partners Master Fund III L.P.
4/19/2012
49,888
18.03
Icahn Partners Master Fund III L.P.
4/23/2012
141,560
17.64
Icahn Partners Master Fund III L.P.
4/24/2012
57,996
17.90
Icahn Partners Master Fund III L.P.
4/27/2012
62,998
17.56
Icahn Partners Master Fund III L.P.
4/30/2012
39,255
17.68
Icahn Partners Master Fund III L.P.
5/7/2012
2,709
16.75
Icahn Partners Master Fund III L.P.
5/8/2012
34,527
16.73
Icahn Partners Master Fund III L.P.
5/16/2012
505,515
14.60
Icahn Partners Master Fund III L.P.
5/2/2012
586,356
17.22
Icahn Partners Master Fund III L.P.
5/3/2012
147,929
17.10
Icahn Partners Master Fund III L.P.
5/4/2012
85,175
17.37
Icahn Partners Master Fund III L.P.
5/15/2012
176,342
14.60
Icahn Partners Master Fund III L.P.
5/17/2012
52,903
13.60
Icahn Partners Master Fund III L.P.
05/18/2012
331,194
14.12
Icahn Partners Master Fund III L.P.
05/21/2012
118,757
14.67
Icahn Partners Master Fund III L.P.
05/22/2012
54,018
14.74
Icahn Partners Master Fund III L.P.
05/23/2012
309,988
14.53
Icahn Partners Master Fund III L.P.
05/24/2012
186,940
14.82
       
     

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