Takeaways From Barron's

I read through the weekly Barron's magazine this weekend.  It was interesting (as usual).  I would suggest that anyone who reads my blog and has real money in the markets should subscribe.  This was the second of three editions with their annual round table.  There is certainly no consensus amongst the panels (round table-ists?).  One guy, Marc Faber, is pretty much Dr Doom & Gloom.

One item that caught my eye was how down people are on China.  It wasn't just a little.  Here are some quotes:

China acknowledged publicly some of the climate and environmental issues it is facing. It's not just the dirty air; it's the dirty water. In the northern provinces, most of the water isn't suitable for agriculture or drinking, and 50% is too dirty for industrial use.

We've been discussing China's water problem. Pollution, too, has become so horrible that people are leaving China with their children. Sometimes, entire cities break down. You hardly have a clear day in Hong Kong any more, or in Shanghai. Agriculture is in disarray because the water table is falling, and agricultural commodities prices have corrected significantly

Then this was very interesting when you consider the round table was 2 weeks ago:

I recommend shorting the Turkish lira. I had an experience in Turkey that led me to believe that some families are above the law. When I see that in an emerging economy, it makes me careful about investing.

The Lira started the year at 2.18. It is now 2.34.

One idea that interested me was Abbey Cohen:  My energy-sector pick is HollyFrontier [HFC], an oil refiner. It closed Friday [Jan. 10] at $49.79. Holly is a U.S. company that benefits from its geography. It has 100% of its refining capacity in the middle of the U.S., and has substantial exposure to light crude. Our energy team expects there will be good spreads [price differences in crude oil] around the world that will benefit U.S. producers. 

That opinion has probably moved WNR up the list in my February tranche ideas.

Another interesting idea was Constellium (CSTM). This was by Meryl Witmer, who has been the best stock picker over time in this group.  They went public last summer and are creators of aluminum products. They were described as Alcoa without the mining component.  With Ford moving away from steel and towards aluminum in their trucks, demand could really begin to increase for the more energy efficient metal.  The company is not that expensive given growth opportunities.

But as I say, there were as many opinions as panelists.  There are those who believe in physical gold and gold miners, bonds, short emerging markets.  They continue to be snarky.

Cohen and Faber went at it as Faber belittled her for being pro Mexico.  Hmm, interesting.  I can not find it now in the online edition. I wonder if they edited it out.  He commented that her mentioning Mexico and being pro-Mexicio that he was now going to recommend shorting Mexico. She later mentioned she liked Nordstrom. And then she asked is he was going to recommend shorting that as well! I will look for it one last time...