Junk faxes

This morning at 5:48, a fax touting a company called Superlattice Power, Inc. came across my office fax machine. The fax came from The Energy Bull which is in the business of "providing bullish picks in the energy and alt-fuel sectors." According to the fax, Superlattice Power Inc.(SLAT) "is an emerging leader in the development and marketing of the next generation of lithium-powered batteries worldwide."
SLAT is much better than the usual junk penny stocks that cram fax machines. It's got actual SEC filings and a market cap north of $200M. There's still no earnings though(it lost a penny per share last quarter). Plus, there's barely any cash in the bank(just under 19K).

Who is The Energy Bull? My Google search turns up nothing. I can only assume that they are a penny stock promotion service. They're not even a good one, as their fax contains spelling errors and language that is evasive and overly enthusiastic.

Let's look at the fine print on the fax for some clues:

The Energy Bull is an independent marketing firm...This report is based on The Energy Bull's independent analysis, and may, or may not be the opinion of The Energy Bull...The Energy Bull has been compensated twenty thousand dollars by a third party for the dissemination of this report.

However, the company published this disclaimer on its website:

Unauthorized Fax Disclaimer
It has come to our attention that unsolicited faxes concerning Superlattice are being sent out by Alternative Energy Advisor, The Energy Bull, and other companies. Management strongly recommends that you disregard these communications from Alternative Energy Advisor, The Energy Bull or any other purported companies; Superlattice has not authorized and does not condone them. Management is attempting to locate Alternative Energy Advisor and The Energy Bull to request them to cease and desist from sending any communications of any type whatsoever concerning Superlattice.

I'm willing to bet the the disclaimer is part of the scam.

Google "stock promotion" and you'll get thousands of companies that make a nice chunk of change touting stocks about which they know nothing. I'm surprised that The Energy Bull was honest enough to fess up to being paid by a third party.

I'm not saying that there aren't viable, investment worthy companies trading on the OTCBB or Pink Sheets. They just don't use promotional services to pump up their share prices. That's what their products and earnings are for.

Bailout coming

Ignore the government right now. Paulson is speaking in both Wall Street and Washington gibberish. Bush said the mortgage giants are “very important institutions.” That's all I need to know. Despite its claims, this President is ot a conservative. He loves government interventions. Plus, he wants his party to win the next election. Bush is already being compared with Herbert Hoover and if he doesn't do something to try and save the housing market and the economy, they'll be linked as twins.

The Dow is under 11,000. Remember Dow 14,000? That's about where it was a year ago when I began this blog. The housing market is tumbling and might need another 25% shave in order to adjust to reasonable levels. Oil has hit yet another record high. The dollar is getting its ass handed to it. Unemployment is up.

Can we finally use the recession word?

The GE earnings release told me everything that I need to know about this economy. One of the best-run companies in the world which is a master of managing earnings, reached into it's hat and didn't pull out a rabbit. Earnings were flat.

Read this statement from CEO, Jeff Immelt:

"Led by double-digit segment profit growth in our industrial businesses and a strong relative performance in our financial services businesses, we delivered a solid quarter in a volatile environment," GE Chairman and CEO Jeff Immelt said.


"Many markets and industries remain healthy, while the U.S. economy is challenged," Immelt said. "Opportunities in emerging markets, infrastructure, commodities and global healthcare are creating demand for our businesses, while we fight through the difficulties of a burdened U.S. consumer, a tough housing market, inflation and volatile capital markets. Even with all this uncertainty, we still see growth opportunities ahead."

That's a nice summary of what's been working in the market and what hasn't. Simply put, if you live in an emerging market, then it's Everybody Wang Chung Tonight. If you live in the good ol' US of A, the song playing on your stereo is Drive by The Cars.

I think that Fannie and Freddie will rally on Monday. Some people with short this rally. I am not that brave. I am going to buy this bottom and wait for the cavalry.

Requiem

Noted value investor, Sir John Templeton is dead. Pneumonia struck him down at the ripe age of 95. Sir John is famous for having founded Templeton Growth back in the 1950s and making early bets on the rebound in Japan. Sir John was buying international equities long before Long before Mark Mobius or Jim Rogers trading securities. Sir John was not just about money however. Through his foundation, he gave away $60 million a year for research into religion and science.

For insight into his investment methodology, take a look at Investing the Templeton Way: The Market-Beating Strategies of Value Investing's Legendary Bargain Hunter by Lauren C. Templeton, his niece. It's a remarkable story of the value of thrift, patience, and truly being a contrarian.