Pantry PTRY

Pg 5: BP CEO Tony Hayward is the new Sergeant Schultz of the TV classic Hogan’s Heroes [ the weekend news is unclear about his future role ]. There is growing concern about Washington’s influence on corporations. May be the large hoard of corporate cash is an indication of this. The European debt crisis has led to large long-term inflows into US ($250 billion from Jan-April). Fed may be on hold until mid-2011 as debt-deflationary cycle continues to unfold; we may see 10-yrs under 3% and 30-yr under 4% again. Pg 13: SP500 2011 consensus earnings estimates of $95 are too high. Analysts will be looking at the Q2 earnings for rising cost and wage pressures and then cut the future estimates. Stocks may not react well to this. The household debt servicing for mortgage and consumer debt was 12.46% of disposable income in March 2010 (vs. a high of 13.96% in 2007); it may partially explain the strength in consumer spending. So, the Fed is bailing out main street too with low rates.   Pg 14: Attractive stocks on follow up: XOM, MELA   Pg 16-17: With euro’s decline, China may not revalue yuan much; it may agree to 3% revaluation but US may want 24% revaluation. The US Charitable giving has held up well, staying above $300 billion for third year in a row. BoA/Merrill Lynch is launching an online brokerage service for clients with less than $250,000 [ Is this something to get excited about in 2010? ]. FOMC  puts out the no-action release on Wednesday. Jeffrey Gundlach kicks off Morningstar’s investment forum on Wednesday [? a conference? something on Discuss? ]. LV Sands opens on Wednesday in Singapore . Russians are coming to Washington on Thursday [ Medvedev et al ]. Russell 3000 rebalances on Friday. G8 meets in Canada starting on Friday.   Pg 19: Attractive: Insurer MET , regional brokerage SF .   Pg 23: Cover story , “Watch Your Assets” on a grab bag of new taxes for 2011-13 . A VAT may be in our future after some bad economic event. Tax reduction strategies include selling ahead properties with capital gains, selling now and buying back [ i.e., pay capital gain taxes now ], using loss carry forwards wisely [ i.e., later, if possible ], holdings income vehicles in tax-deferred accounts, buying munis, taking out insurance policy loans, Roth conversions, and paying attention to old/new estate tax rules.   Small businesses generate most of the jobs. But they need the money from local banks to expand business. However, 91 banks in 30 states have skipped dividends to the government on the TARP money they received in order to preserve capital – so small business have to wait.   Pg 27-29: Attractive steel stocks for global recovery: AKS, NUE, RS, STLD, X   Convenience store chain PTRY (brands Pantry/Kangaroo Express) is featured; it may be an acquisition target.   Pg 30-32: Finnish NOK is stuck in the pre-iPhone era. Stay out of this value trap.   A new free portfolio management tool from www.wikinvest.com may be one of the best. It will catch up soon with Intuit’s Quicken.   A Supreme Court ruling on software patents (Bilski vs Kappos) may affect future e-commerce.   Pg 33-36: Tom Forester of FVALX (not to be confused with FDVLX) has been boosting cash (~17%). He thinks that the recovery will not be strong and the markets will be range bound, creating trading opportunities for the fund.   CLVFX is a family operation. It looks for great, best-in-class, “Steady Eddie” companies at very cheap valuation. But it is staying away from BP [ see below for another view ].   Pg 37: Robert Lawrence Kuhn , who has written extensively on China , thinks that changes in China can come through active engagement with the west.   Pg 41: Value investors Whitney Tilson and Glenn Tongue of T2 partners explain their new position in BP . They think that it is cheap and big; the cleanup costs will be spread over many years; the environmental damage caused by prior major oil spills (#1-by Iraq into Persian Gulf, #2-Ixtoc I/Pemex, #4-Exxon/Valdez) were manageable; and there is historical experience with tobacco, asbestos, breast implants and Vioxx litigations. They think that this market overreaction is a wonderful buying opportunity.   Pg 42: Recent market turmoil has created an opportunity to buy SYK relatively cheaply. Its businesses include orthopedic implants, surgical instruments, medical equipment and hospital beds.   Pg 47: Editorial on Greeks (and then Spain, Italy, Germany) reducing their healthcare payment obligations via governmental decrees.