Sunday, September 23, 2007

US housing futures

Wow! now we can trade 5 year housing futures for the US. See article by Matthew Hougan here . A 15%-25% fall in real estate prices - unadjusted for inflation, is expected.

Sunday, September 16, 2007

Moody's Coproration MCO

Moody's (MCO) is an interesting company. To the unsophisticated like me it seems like they give you three letters like "AAA" and get a load of cash in return. Even Warren Buffett holds a stake. It seems like the perfect business to own - has a moat and has low requirements for capital.

What could go wrong? Recently the price has fallen on fears of lawsuits related to its role in the subprime lending mess. I am not qualified to comment but I feel that "Cogitarius" has done a good job summing up the issues on a Motley Fool board here.

So should I buy? Naah! If you know me you know that I have a way of avoiding value traps. I will not buy unless there is some confirmation from insider buying. You can see the insider trades for Moody's here. So if I see more insiders buying in the open market I will jump in.