Why I don't buy Cramer's " just pay up" - Gilead thesis.

Stock Talk:

Recently the Biotech sector has been affected by Congress questioning why Gilead thinks they can charge $1000 per pill for a regimen of treatment for Hepatitis C. Yes, the nucleotide based drug is a breakthrough that cost a lot of money to develop and take through the maze of FDA testing. Today, we see Jim Cramer and Celgene CEO proclaiming how we, the little people and our insurance companies, just have to pay up at the pharmacy counter because these drugs "cost so much" to develop.

However, if you examine the history in this case, you will see that Gilead acquired the drug in an acquisition of VRUS which they paid up in an historic $11 Billion buyout. Now had VRUS been left alone to complete the development, how much more would they have had to spend? maybe $100 Million dollars ?

Well my point is that just because GILD paid too much for VRUS, does not mean that exorbitant prices at the pharmacy counter should go unquestioned.

I think that Congress is right to question it and look into it further because a single pill costing $1000 a pop when Gilead overpaid for VRUS is passing bad business practice onto consumers.

They overpaid for VRUS with apparently bad business decisions. Why should we the consumer pay for their bad decisions?

I am saying the actual costs for the development would have been a LOT lower than the $11 Billion that Gilead paid up for to buyout VRUS.

instead of $1000 a pill , maybe it would be a profit maker at $100 per pill if Gilead had not stepped in?

It all bears further review in my view.


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ALL in my humble opinion, scroll down and read more..

This site does NOT make Buy / Sell recommendations.
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This Morning's market interpreted.

Market Talk:

The Crimean's voted for inclusion into the Russian fold. They apparently celebrated the vote in the streets, if you can believe it. This morning's market is responding in a relief rally, as shorts cover.

The market is saying that Crimea's secession from the Ukraine whether by hook or by crook was a foregone conclusion, once Russia started their takeover games. If a foregone conclusion from the start, then why all the games and maneuvering with this n that threat. It could be that defenders of democracy as in our US state department have to rattle sabers or sanctions to send the Russian's the message that there are repercussions in sieging upon other countries assets and land grabbing. The question is how far should we take it? At some point threats and objections become hollow whining. especially when many in the US are sick and tired of being the world's police outside our boundaries.

There are still troubling signs all around the world. For now, the market wants to put all that on ignore and is back in a relief rally mode. The shorts that thought they got the memo last week may have mistimed the whole thing yet again.

Oh well, those who live by the dark side of the shorting sword, die by the sword. Or run away to fight another day.

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ALL in my humble opinion, scroll down and read more..

This site does NOT make Buy / Sell recommendations.
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Markets climb the wall of worry.

Market Talk:

The Russian / Ukrainian standoff seemed to ease yesterday as Putin made some conciliatory words about not expanding an offensive unless Russian interests are threatened by the new Government forming in the Ukraine. Well, how Russia perceives things going forward is open to question. He also raised concerns about economic sanctions by threatening to retaliate by doing things that would have a negative impact on the US dollar in world markets. All in all, the market took to the notion that the immediate threat of an all out Russian attack beyond the sea port Crimea is off the table. Who of us in the US even heard of far off places like Crimea before three weeks ago? The majority of us would likely say - where's that? But it is a peninsula that Russia apparently has strategic interests with a naval fleet there.

Part of the Ukraine seems to have Russian sentiments and part of the Ukraine wants to be part of Europe. Hmmmmm .... That's up to them to figure out. I also don't think NATO wants to get too involved at least yet. However President Obama has been doing a lot of jawboning to Putin about the Ukrainian right for self determination. We know Obama has the gift to gab but I'd have to say maybe it helped make Russia see that world repercussions in terms of sanctions could be very negative if they pursue aggressive tendencies towards the newly forming government.

That Russian propaganda machine is portraying the new Ukrainian government as fascists in their view is a troubling indicator and Putin reserves the right for future actions should they feel justified. That Putin has threatened retaliation to the US dollar is another concern.

In the meantime, the day to day market shrugged off the immediate threat just means that the Ukrainian situation will be put on the back burner in the market's view until it becomes a problem again.

In the meantime, the market looks at economic indicators for growth and corporate earnings and is back to watching fundamentals. With the market flirting at historical highs, the ongoing concerns affect the bull market in terms of corrections as each new high is reached. And thus we have see the dynamics behind the old adage that - "the market climbs a wall of worry".

When valuations are determined a bubble, the market will correct itself. In the meantime the players will play, the traders will trade and the games will go on. I'll stick to watching the fundamentals and avoid the hyped up BS that they dish out all day and night.


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ALL in my humble opinion, scroll down and read more..

This site does NOT make Buy / Sell recommendations.
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Something always happens.

Market Talk:

The other day they polled the trader group on Cnbc about if the bull market will continue and should people be buying stocks. Not one of the traders expressed caution and all said heck yeah buy stocks.

A few days later after the Olympics, a Ukrainian revolt and Russian backlash aggression in the area and we have a shaky market. The same traders that said buy before now say they don't know if they should "be long". The Dow was off 250 at one point, closing down 155 to 16,166. Gold was higher by about 30 bucks to 1,350.

When everybody is bullish on a panel of traders, that's time to be circumspect in my view. The other day when the traders were pounding the buy tables, I was just thinking about the one saying that seems to happen over n over again in the market and stocks.

yup.... "something always happens".


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ALL in my humble opinion, scroll down and read more..

This site does NOT make Buy / Sell recommendations.
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What was that?

Market Talk:

What was that yesterday? The market off over 300 points on the dow? And today? Morning trading looks like a bounce.

yup, volatility is back. Yesterday's sell off was just a correction to some and they buy today.

But the correction may be based on the reality that home and car sales are quite sluggish. Yes, perhaps it's the weather and perhaps not. Perhaps it's just fabricated stories that the financial media puts out there to suit big money and their sponsors positions.

Well, that's the market, mostly made up of BS firmly fixed on a base of jello.


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ALL in my humble opinion, scroll down and read more..

This site does NOT make Buy / Sell recommendations.
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Is the market like a Flying Dream ?

Market Talk:

Do you ever have a flying dream? I get them once in awhile. It can be a fun dream. Often when these dreams come to me, I am perfecting a particular technique or movement that brings aerodynamic lift and then flight suddenly happens.

When my daughter was just a kid we used to have fun in the pool this way. I would throw her as high as I could and tell her to work on an arm gesture to catch flight. It never happened but we had fun trying. Sometimes it got so silly that we would crack up laughing and try again and again, perfecting the ones that took her higher.

But in my flying dreams, sometimes I will fly back to my old neighborhood and try to teach my old friends how to fly. It usually starts out with a running start and then taking leaps with my arms out as far as I can. Then there's some unusual flipping out of a leg with the nuance of a turned foot in a certain position and arms outstretched and voila! flight happens.

In other dreams sometimes I just jump as high as I can and then believe I can fly and rather than come down, I float about longer than gravity would take and then catch the air and off I go, in amazement to myself and gawking bystanders.

These dreams, while not often, can be quite fun in dreamland.

However, there are some flying dreams that happen to go too far. Not all landings are graceful.

For example, sometimes we get too much altitude and then suddenly lose the technique that got us there. It could be the "belief" that we can indeed defy gravity . Suddenly falling victim to the notion of "what goes up must come down". Then as the fun flying comes to an awkward end we flail about and wake up with our arms and legs moving in the bed.

Well, take the market yesterday and today. After reaching all time highs, the Dow has faded below the 16,000 mark as of this midday Friday report. Some say the overall market got ahead of itself. Some say it's just a normal Friday's profit taking and will snap back after a slight correction.

Sometime the collective macro market is looking ahead predicting future sentiment for some unknown reasons or another. There is posturing by China over some uninhabited islands in the South China sea that both Japan and China claims ownership. China claims airspace rights and that is a potential source of trouble in the Asia pacific region with our ally, Japan.

Meanwhile Apple has started their cell phone business with China Mobile. It's about time from Apple's view because they have been manufacturing I phones in China for years. Billionaire hedge fund investor Carl Ichan has been buying up Apple shares on the dips and becoming more an activist towards Apple management. I'm sure they now think he's a pain in their ass. Meanwhile. Microsoft had a nice quarter and is defying the gravity of falling stocks today as the Dow is now off over 200 points.

Well, the future of the market is dependent on a lot of things like a continued economic recovery and investor belief that corporate earnings will continue to show growth. But some individual stocks appear way ahead of their current earnings or future growth projections. These stocks are vulnerable.

Well, is the market entering the flying dream stage where the belief is starting to wane as maybe the Fed starts tapering the money supply? Or is this all just a profit taking bounce on cold Friday here in the east.

The winds of the future will only say and they are not speaking to me yet.



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ALL in my humble opinion, scroll down and read more..

This site does NOT make Buy / Sell recommendations.
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When speaking of the market, I'll say perhaps.

Market Talk:

The market is currently enjoying a bull market mentality. The banter is relatively optimistic towards big business. While some companies are enjoying nice gains, others languish or drop hard for one reason or another. There is a bit of volatility and many people are waiting for the rug to be pulled but in the meantime the bull market prevails, for now.


I have stated the obvious in general terms because speaking about the market and stocks can be like a broken clock. It may be correct twice a day.

If you are interested in the market, you should try writing down your feelings and projections about the matters and stocks of the day. What you may find out is that "the market" has a collective mind of it's own and trying to estimate or project can be akin to watching wild or even house cats. They can be unpredictable.

Often, when you may think you have it figured out, that may last for the moment or even awhile but then something always seems to happen to trigger change. Perhaps when thinking about the market the events of 2006 through 2008 are too mired in my consciousness and therefore I do not want to speak about it much.

Well, we're in a bull market at this point in time. The overall stock indices at all time highs. And yet some sectors are topping and already caving. Perhaps these sectors such as 3D printing were over extended and due for a pullback. The market has a way of correcting itself.

Sometimes it takes an event to trigger a correction. Perhaps the stocks will continue the bullish run, perhaps it will level or perhaps not..

I'll say perhaps as the word of the day.



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ALL in my humble opinion, scroll down and read more..

This site does NOT make Buy / Sell recommendations.
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