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Too Big To Fail, Our Ever-Dubious Arse — Brooklynian

Too Big To Fail, Our Ever-Dubious Arse

worldwide trader
worldwide trader
edited November -1 in The Lounge / Random Stuff
Just wondering: whatever became of Wall Street’s supposed supercool safe stocks? The “widows” and the “orphans,” the blue-chips that were undervalued (but too good to end up going the way of the do-do) the profitable if unsexy, the old reliables, even the “Nifty Fifties” of long ago (gag)? Or was that always just one big, steaming mound of dromedary droppings?

The collapse in General Motors and Ford stock has led some to ask if there are really any "widow and orphan" stocks left.

That was the phrase used on Wall Street for much of the last century to describe blue-chip stocks so reliable that they could comfortably be held even in the portfolios of the most vulnerable and risk-averse investors.

The reality?

There are no probably no widow and orphan stocks on Wall Street. If, indeed, there ever were.

Continue reading on WSJ.com

Comments

  • bohuma
    bohuma
    Probably the only "Blue Chip" type stocks are in those companies that sell the necessities of life. The car companies are suffering because most people can put off buying a new car for a year or two, and seem to be doing just that. Companies and individuals are also cutting back on travel, so car rental companies are probably downsizing their fleets.

    Most electric utilities would count as a safer stock, depending on how exposed they are to the wholesale market in electricity. Your regular monopoly style regulated electric company will continue making money. People might cut back a little on electricity but all that means is that the electric company turns off the expensive natural gas turbine peaking unit, but it will keep running its coal and/or nuclear plants, most of which produce very cheap electricity.

    The cheaper end retailers of food and clothing should also continue to do a good business. McDonalds sales are up, Starbucks are down.

    Look for companies that sell cheap staple items.

    All else being equal, Southwest Airlines should continue to be profitable.
  • worldwide trader
    worldwide trader
    bohuma wrote: Probably the only "Blue Chip" type stocks are in those companies that sell the necessities of life. The car companies are suffering because most people can put off buying a new car for a year or two, and seem to be doing just that. Companies and individuals are also cutting back on travel, so car rental companies are probably downsizing their fleets.

    Most electric utilities would count as a safer stock, depending on how exposed they are to the wholesale market in electricity. Your regular monopoly style regulated electric company will continue making money. People might cut back a little on electricity but all that means is that the electric company turns off the expensive natural gas turbine peaking unit, but it will keep running its coal and/or nuclear plants, most of which produce very cheap electricity.

    The cheaper end retailers of food and clothing should also continue to do a good business. McDonalds sales are up, Starbucks are down.

    Look for companies that sell cheap staple items.

    All else being equal, Southwest Airlines should continue to be profitable.
    Point well taken.
  • daver
    daver
    So, um, buy Enron, McDonalds, and Wal-Mart? :mrgreen:
  • modsquad
    modsquad
    daver wrote: So, um, buy Enron, McDonalds, and Wal-Mart? :mrgreen:
    How can I buy Wal-Mart, if I've been reduced to shopping at Wal-Mart?
  • alafairnadia
    alafairnadia
    modsquad wrote: [quote=daver]So, um, buy Enron, McDonalds, and Wal-Mart? :mrgreen:
    How can I buy Wal-Mart, if I've been reduced to shopping at Wal-Mart?

    buy their house brand? gloop in a can?
  • modsquad
    modsquad
    alafairnadia wrote: [quote=modsquad][quote=daver]So, um, buy Enron, McDonalds, and Wal-Mart? :mrgreen:
    How can I buy Wal-Mart, if I've been reduced to shopping at Wal-Mart?

    buy their house brand? gloop in a can?

    I do get a cheap price on the 22 longs.
  • dapearl9
    dapearl9
    Supposedly Cambell's has been doing very well.
  • bohuma
    bohuma

    Subject: McDonalds and Wal-Mart yes

    daver wrote: So, um, buy Enron, McDonalds, and Wal-Mart? :mrgreen:
    Yes to McDonalds and Wal-Mart, but if you're getting stock tips here you're probably too late for a bargain.

    Enron did not fit the traditional utility model, it was highly exposed to the wholesale market, plus it was run by thieves. In looking at electricity stocks you are looking for a company with a monopolistic position in a regulated market with no fancy shenanigans going on. You do a web search and if you read that their doing interesting things in the derivatives market, move on. Unfortunately your about eight years too late to buy up nuclear utilities cheap, they're now expensive because some of the smart guys at AmerGen and Entergy realized that a fully depreciated, paid for nuclear power plant can produce electricity at $0.01 per kilowatt hour and sell it for $0.065, otherwise known as a license to print money.
  • worldwide trader
    worldwide trader
    modsquad wrote: [quote=alafairnadia][quote=modsquad][quote=daver]So, um, buy Enron, McDonalds, and Wal-Mart? :mrgreen:
    How can I buy Wal-Mart, if I've been reduced to shopping at Wal-Mart?

    buy their house brand? gloop in a can?

    I do get a cheap price on the 22 longs.

    What kind of glass do you have on that?
  • modsquad
    modsquad
    worldwide trader wrote: [quote=modsquad][quote=alafairnadia][quote=modsquad][quote=daver]So, um, buy Enron, McDonalds, and Wal-Mart? :mrgreen:
    How can I buy Wal-Mart, if I've been reduced to shopping at Wal-Mart?

    buy their house brand? gloop in a can?

    I do get a cheap price on the 22 longs.

    What kind of glass do you have on that?

    How can I put this? I have heard there are certain manufacturers of semi auto and fully automatic small arms who, in order to sell their product require rifle ammunition. It is a question that the pimple face blue vested retard has to ask. Oh, to answer the question, no glass.
  • whynot_31
    whynot_31
    Semi automatic weapons are doing very well. People are getting them now under the belief that they will be banned under the new administration.

    I guess its easier than modifying them post ban...

    http://www.quarterbore.com/nfa/sbr-aow-pistol.html
  • carnivore
    carnivore
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