Summit Notebook
Exclusive outtakes from industry leaders
That’s rich. I meant the wine.
What do gold and wine have in common?
Price.
Well, too high of a high price, according to Jeffrey Rubin, director of research at Birinyi Associates, the stock market research and money management firm.
Rubin told the Reuters Investment Outlook Summit on Tuesday that he thought gold prices were “certainly a little frothy” at current levels and that he would rather be a buyer of the gold miners such as Newmont Mining Corp, Barrick Gold Corp, or Freeport-McMoRan Copper and Gold Inc. Gold hit an all-time high above $1,250 an ounce on Tuesday as investors piled in due to fears that European credit contagion could lead to a double-dip recession.
Rubin isn’t expecting a double-dip U.S. recession, saying the chances are slim. He also felt stock prices were likely near a bottom. Not so for the price of a wine? A good year is already priced in, so to speak.
In the spirit of austerity, we asked Rubin what personal spending he might curtail. For a wine collector with a 1,500 bottle collection, the answer was bitter.
Ritholtz: I zig when everybody zags
The U.S. economy is experiencing an ongoing but slow recovery, says Barry Ritholtz, director of equity research at Fusion IQ. But that’s not stopping him from enjoying discounted prices in a low-inflation environment, at least when it comes to his personal spending habits. The world is on sale if you’ve got the money to spend, he told the Reuters Investment Outlook summit in New York when asked, for example, if he might spend less while on a vacation or forego a purchase or two.
“I am an enormous counter-cyclical spender. At the top of the bull market I don’t want to buy anything. I am a seller into a bull market. We have been buying a ton of stuff over the past year. We got two new cars long before the May…. so we picked up two new cars. We’re doing work on the house. We’re adding a kitchen. I got my wife a very lovely birthday gift. She got me a very lovely birthday gift. We’ve been buying artwork. We’ve buying jewelry. I love to buy stuff when it is on sale. I hate to buy top dollar for it.
“So, we just were in the Cayman Islands on vacation some time ago. We were in Aruba back in December. I’m heading to Vancouver in July and probably take a week or two in the Hamptons. I’m thrilled to spend money in this environment.
“I got an e-mail from a client in the heart of ’08 saying the advise and commentaries have been great but you’re just so relentlessly negative in ’08, you’ve got to say something that makes me not want to commit suicide.
“I said stuff is on sale, go buy stuff. Go buy collectible automobiles, artwork, jewelry. If you want to buy real estate, you are probably early, but if you find a unique property, and as we have seen with some of these so-called trophy properties they’ve come down in price but they don’t plummet the way some condo in Miami is going to plummet. If you find something you really want to get, buy it now. Don’t be afraid to make low-ball bids on artwork. If it is $15 million up from $8 million, bid six and you might get surprised by what happens.
“In this environment I’m happy to tell people, if you can afford it, don’t go out and borrow against the house, don’t leverage yourself, but if you have the ability to go out and spend money and there are things you want and they are significantly discounted from where they were three, four, or five years ago, why the hell not? I would much rather spend when things are cheap than pay up when things are expensive.
Oh yeah, Barry sure zigs and zags a lot. This guys flips flops with the best of em:
Unfortunately, some people actually track your calls Barry and don’t fall for the BS. Those of us who are familiar with your little games know how you work. You are basically always hedged to win. We’re in a “secular bear” and a “cyclical bull” so you basically can’t be wrong. But within that you write hundreds of articles a month. Some bullish and some more bearish. When you need to you just cherry pick what suits your personal interests.
For instance, back on February 24th 2009 you said that we weren’t even close to bottoming: http://www.ritholtz.com/blog/2009/02/cap itulation-hardly-2/
But then miraculously just two weeks later everything had changed and you were very bullish. You often cite how you “called the bottom”. But then just one month later you were bearish again: http://www.ritholtz.com/blog/2009/04/bea r-market-rally-4/
But then just one month later we’re in a “cyclical bull” market: http://www.ritholtz.com/blog/2009/06/cyc lical-or-secular-bull/
But even throughout it all you’re constantly “hedged” and have protection and “tight stops” on all the time. I mean, even when you were wildly bullish and take credit for the rally you were really only about 60% invested with a HUGE 40% cash position: http://www.ritholtz.com/blog/2009/08/kas s-call-top/
60/40 isn’t exactly a conviction buy call, but in Barry’s “always hedged” world it can be painted however he wants it to be painted!!!!!! Yeay! You are always right. How incredible.
The smart people are on to your scam…..
Are the days of flying business and 4-star hotels over for biz travelers?
Are flying coach and staying at budget hotels the “new normal” for businesspeople who travel for work? If so, what does it mean for airlines, hotels and casinos still trying to recover from the economic downturn? Chris Woronka, Senior Gaming, Lodging and Leisure Analyst at Deutsche Bank Securities shares his thoughts with us on what’s in store for the Travel and Leisure Industry in 2010. Will the industry once again be flying high? Or, will the prospects for a better year ahead get grounded?
Audio – Everybody loves a winner in Vegas, baby!
It seems that any sentence about Las Vegas, the people who work there or the stocks of the companies that run the big casinos ends better with the word “baby”. It’s almost like you can hear Frank saying it to Dino on their way into some smoky, after-hours cocktail party.
So, even though Bill Lerner, casino and gaming analyst at Deutsche Bank didn’t exactly end his comments on casino stock picks like Sinatra might have … well, it’s Vegas, baby!
Lerner, speaking at the Reuters Travel and Leisure Summit in New York, spoke extensively about the stocks in the gaming sector and identified the ones he thinks have the best chance at near- and longer-term success.
Lerner was one of the featured speakers at the summit, which continues through Wednesday in our New York headquarters. The Summit program is in its fifth year, and in 2009 will include top-level executives from industries and sectors including everything from Infrastructure; to Mining; to Investing in India, China, Japan and Russia; to Food and Beverages.
Audio – Las Vegas mogul defends fun city
By Tim Hepher
Las Vegas casino legend Sheldon Adelson launched a quest for America’s most boring city on Tuesday in a comeback to President Barack Obama’s criticism of bankers who hold meetings in the famous gaming capital. Obama last month warned companies that get bailout cash against spending it on activities potentially seen as perks — sparking a row with hotel and resort operators who say they are already struggling to fill rooms and may have to cut jobs. “The good news is that Las Vegas has become a synonym for a good time for adults. Let me not say adults, I’ll say grown-ups, I don’t want to give the wrong impression,” Adelson, majority owner of casino operator Las Vegas Sands, said. “The bad news is that because it is a place for a good time, President Obama says that he doesn’t want taxpayer’s money to go there,” Adelson told the Reuters Travel and Leisure Summit. “But I’m going to conduct a survey and I’m going to provide a prize for people who will submit the name of the worst city in the country to go to, where people can enjoy it the least. Because that’s the alternative. The alternative is you go to a place where you enjoy, or you go to to a place you don’t enjoy.” The self-made billionaire, who tore down the original Sands to build the Venetian Resort complete with canals, and brought business conventions to Las Vegas, declined to nominate places for his ‘dive prize’ but took a swipe at Obama’s home town. “Look, Chicago has got nine casinos. Now, God forbid if they hold a convention there someone should go to one of those casinos and enjoy themselves. God forbid. And then they’d say ‘Oh I can’t go there’,” he said.
A scandal over perks erupted in October after insurer AIG flew top brokers and executives to a Southern California resort at a cost of $440,000 shortly after it received an $85 billion government bailout. “You can’t take a trip to Las Vegas or down to the Super Bowl on the taxpayers’ dime,” Obama commented last month.
Quintin shows about as much grasp of the current problems as our current president has and showed by his choice of words in slamming a company and thereby a major US city and it’s employers, citizens, and government. If you want to talk about waste of the taxpayers money just let the congress look in the mirror and Queen Nancy is a perfect example of the arrogance of the federal government.
This started long before Obama, with the congress and federal agencies putting pressure to provide credit to those that could not handle or afford it. The outcome is simply the result of what congress and the liberals in power put in place and created from “Main Street” to “Wall Street” period.
Audio – Bad is bad
Trying to compare one recession or economic downswing to another is a little like trying to decide which hurricane was the worst.
I mean, if you were sitting in the middle of Hurricane Katrina, it’s not going to matter too much if Hurricane Hugo’s winds were 10 miles an hour faster. They both weren’t a lot of fun.
So it was on Tuesday when Doug Parker, chief executive of US Airways Group, tried to distinguish between the current recession and previous ones. No one wants to be too close to the eye when the howling starts.
Parker, speaking to the Reuters Travel and Leisure Summit in New York, said this slowdown is bad — as was the one in 2001-2002, although for diferent reasons.
Parker was one of the featured speakers at the summit, which continues through Wednesday in our New York headquarters. The Summit program is in its fifth year, and in 2009 will include top-level executives from industries and sectors including everything from Infrastructure; to Mining; to Investing in India, China, Japan and Russia; to Food and Beverages.
Audio – Air France-KLM CEO sees some unfriendly skies ahead
The state of the airline industry and travel overall is not poised for a rapid takeoff in 2009 and looks like it will remain in rough shape until next year, said Pierre-Henri Gourgeon, chief executive of Air France-KLM, on Monday at the Reuters Travel and Leisure Summit.
The head of Europe’s largest airline, who became CEO in January, said he was unsure when things would turn around, but warned that both passenger and cargo metrics were down for the airline.
Gourgeon also said that while there is still some business travel out there, many passengers are trading down from more expensive, high-end to coach, or less expensive travel.
Gourgeon was one of the featured speakers at the summit, which continues through Wednesday in our New York headquarters. The Summit program is in its fifth year, and in 2009 will include top-level executives from industries and sectors including everything from Infrastructure; to Mining; to Investing in India, China, Japan and Russia; to Food and Beverages.
Audio – And then there were two?
Priceline.com CEO Jeff Boyd told the Reuters Travel and Leisure Summit in New York that he thinks that at least two out of the four players in the online travel sector – Priceline, Orbitz, Travelocity and Expedia – could be in a position for either an IPO or a sale once the economy turns up.
“I think that the most important fact there is that two of the major players are owned by private equity,” he said. ”Orbitz is controlled by Blackstone. And Travelocity and Sabre Group are controlled by TPG and Silver Lake Partners. And what that means is eventually they will be looking for a way to monetize those private equity investments, and there’s two ways of doing it.
One is through a public offering and the other is a sale. So, eventually there’s going to be some transactions there, and that could be a catalyst to some consolidation.”
Indeed, due to a global financial crisis, some companies have removed expenses that is not essential for them(like traveling privileges). Travel and Leisure Industry should really sought things out and find measures to help resolve their problem or figure a way to avoid bankruptcy especially for the small players.
Both public health risks and financial risks issues can be reduce to its minimal level if we consider online transaction in every way if possible. Purchasing goods, banking, stock market transactions and many other ways of trading would greatly be more risk-free, productive and time-efficient if all is done Online*.
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