FT - How to read 10k

• First, go to item 7. This is where a company has to give its most thorough assessment of current conditions and future prospects. it is here that shareholders might discover that a corporation holds most of its liquid assets overseas, or that a large proportion of its financing is off-balance sheet.
  
• Consider management's views alongside risk factors outlined earlier in item 1A
• Look at the explanation for difference in GAAP and non-GAAP measures. Whether the exceptional events that flattered the non-GAAP numbers are really one-offs.
• Credit Suisse analysts recommend looking at accumulated other comprehensive income, where anything from currency gains and losses to changes in pension fund status can be found.
• Lawsuit potential damages are listed in item 3
• Look at foot notes. They have info on gross positions for derivative assets and liabilities rather than netting them off(current profit / loss)
• If goodwill has been impaired, try to find out why. Do the reasons reconcile w/ management's expectations for earnings power in item 7?
  

FT

• Cocos - contingent convertible bonds - convert debt to equity if a bank's capital ratios fall to a pre-assigned level, and are supposed to make a bank safer.
• As soon as you get near a trigger level, the stock should fall VERY quickly because you know it will halve in value if the coco is triggered!

Underwriting - the underwriter bears the risk of being able to sell the underlying securities, and the cost of holding them on its books until such time in the future that they may be favorably sold

• US mortgage rules - banks must retain 5% of any 'non-qualifying' mortgage w/ downpayment less than 20%. This may be significant and only solved by the development of a covered bond market (coco's?)
• Oil vs USD
1. Oil prices goes up
2. More petro-dollars(USD) in other oil producing countries
3. Need to sell USD and buy home currency
   
4. Excess supply of USD => price USD vs other currency falls(or T-rates fall)

FT - bonds

• World bonds average 7.7%/year above inflation from 1982 to 2008, the best since the deflationary 1930s. But this was an aberration, which has made bonds look safer than they really are.
• History shows just how badly bonds can perform. at LSB, some researches pointed out that it took US treasuries 51 years from Dec 1940 to get their money back after inflation. At their worst, in 1981, bonds were down 67% in real terms
• By picking the fifth of countries w/ the highest inflation the previous year, rebalancing each year, would have returned 4% above inflation over the past century. Countries w/ the lowest inflation returned just 2.3%. => this didn't work well from 1900 - 1924 (even excluding Germany's hyperinflation)
  

TPC

• Chinese PMI came in at 51.7 a 7 month low. Stated as positive because it shows manf. sector is cooling

Bespoke

• Higher CPI on the horizon. Whenever ISM Commodities reported up/down in price (net) goes up there is a correlation w/ CPI Y/Y
  

TN

• Muni-Bonds will suffer $10 - $30B in defaults at some point. Watch for etf MUB crashing. I suggest buying around $64 (6% yield)

FT

• NE permit for deep water drilling approved. May 6, 2010 it was suspended. Stock bottoms in June 4, 2010. Starts moving beginning of December (8 months after drilling should be allowed to resume)

FT -

• US Dept of Agric - food inflation will surge in the 2nd half of this year as wholesale prices filter through the supply chain, affecting consumers
• This will fuel global concerns about rising inflation and the potential for destabilizating food riots in developing countries
• Investors may tell today's surveys they are bullish but US trading is at 2004 levels. There are good fundamental reasons to think shares are a poor medium-term bet. But exuberance remains pretty mild.

Bespoke

• Weight Watchers (WTW) was up 45% in one day on a very strong earnings report. NTRI also rose 8% that day. However, NTRI reported 5 days later, and was down almost 30% after the report. Keep this example in the back of your mind the next time you think about trading a stock based on news from one of its peers/competitors.

SP500 last 50 years

	1	2	3	4	5	6	7	8	9	10	11	12
avg	1.02	-0.24	1.17	1.51	0.27	-0.06	1.00	0.05	-0.46	0.62	1.56	1.73
std	4.94	3.50	3.42	3.89	3.73	3.56	4.12	4.65	4.50	5.54	4.44	3.20
largest(6#)	0.99	0.60	0.69	0.81	0.59	0.53	0.74	0.75	0.65	0.93	0.83	0.74
smallest(6#)	-0.71	-0.63	-0.51	-0.55	-0.67	-0.67	-0.64	-0.88	-0.90	-1.04	-0.74	-0.39
avg*	0.74	-0.20	1.00	1.25	0.35	0.08	0.90	0.18	-0.21	0.73	1.46	1.37
std*	3.35	2.12	2.07	2.56	2.52	2.37	2.98	2.83	2.91	2.50	2.74	1.98
avg* - std*	-2.62	-2.33	-1.07	-1.31	-2.17	-2.28	-2.08	-2.65	-3.13	-1.78	-1.27	-0.60

Best months to invest overall are: Dec, Nov, Apr, Mar, Jan, Jul, Oct
Best months* to invest overall are: Nov,Dec, Apr, Mar, Jul, Oct, Jan,
Worst Months are: Sept, Feb
Best Months incl std are: Dec, Mar, Nov, Apr, Oct

TPC -

• Rising oil prices will actually cause deflation in core CPI during a balance sheet recession because people will spend more of their money on gas. CPI will obviously still rise.