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(Paul Tudor) Jones also thinks the markets may end up forcing the federal government to clean up the nation’s balance sheet in as little as three or four years from now. And he said that would present a once-in-a-generation opportunity to own assets. Link

WSJ: Sales at U.S. chain stores last month rose 3.4% compared with October 2010 for the 22 retailers tracked by Thomson Reuters, but that was less than the 4.5% rise expected by analysts and the 5.1% notched in September. Link

Bloomberg reports on Apple’s operational competitive advantage. Link

Sodastream CEO presentation on September 8, 2011 Link

Notice on “Slide 39” during a presentation the SodaStream CEO gave in September 2011; there is nothing on Target, Staples, and Costco.

Using the “Where to Buy” feature on the SodaStream website (Link), I find the product is now available in about 1/2 of Costco locations (a rough sample estimate) and every Target and Staples store in my area (Note: this may not be the same across the country). 

A friend of mine in California said SodaStream was recently made available at his local Costco. My wife told me she saw SodaStream being demo-ed and sampled last weekend at our local Costco on the East Coast. I called that Costco up and an employee told me they had 100 units in stock.

I drove to my local Staples tonight and saw a huge end-of-aisle SodaStream display with 12 units right out in front when you walk in. It was right next to the Green Mountain Keurig display. I talked to an employee who told me he set the display up TODAY and they have one more box of inventory in the back. I estimate this Staples store got 20 units shipped-in.

I drove to my local Target and found the SodaStream display in the home kitchen area next to the microwaves and water filters. There was shelf space for 20 units. It looked like about 5 units were sold. I used the inventory checker with one of the units and found there was no more stock in the back. A Target employee told me it was a recent launch.

In previous SodaStream conference calls, management talked about a small 12 store test trial at Costco, which we now know had a large roll-out ramp up in the past week to more locations. Management also talked about testing at a big box mass-market discount retailer in the past year. Now we know that was Target with a massive roll-out this quarter. The Staples roll-out today is another positive surprise.

Costco has 432 stores in the U.S. Target has 1767 stores in the U.S. Staples has 1575 stores in the U.S.  I do not know the exact store roll-out numbers, but from a dozen zip code searches on the Sodastream site’s “Where to Buy” feature it looks pretty significant across the board.

If you do the shipped-in math of 20 units per added Target and Staples stores and 100 units for 1/2 of the Costco stores for $80-120 per unit, it is easy to see upside vs. the Wall Street estimate for U.S. SodaStream revenue this quarter. Please note this is U.S. revenue only. I have no visibility on their sales in Europe.

Third Point Q3 2011 investor letter (must read!). Link

October retail same-store sales Link
Saks 1.8% vs. 5.4% est.
Costco 9% vs. 9.2% est.
Target 3.3% vs. 4.2% est.
Macy’s 2.2% vs. 3.6% est.
Nordstrom 5.4% vs. 6.4% est.
J.C. Penny –2.6% vs. 1% est.
Kohl’s 3.9% vs. 3.7% est.
Limited 6% vs. 6.2% est.

ECB cut its main interest rate by a quarter percentage point to 1.25%, in new ECB honcho Mario Draghi’s first policy meeting. – WSJ

WDC STX – As floods in Thailand have seriously impacted the hard drive supply chain, Western Digital recently notified its distributors in Taiwan that the company will not distribute any hard drive supplies to Taiwan in November. Samsung Electronics is also not supplying any hard drives to Taiwan in November and will shift shipments for the use of its own-brand PC products, according to sources from channel retailers. Currently, channel supplies can only last until mid-November, the sources noted. Link

AAPL – “Apple’s new generation iPad will enter mass production soon with the launch set for March 2011. Apple does not view the new iPad product as iPad 3, but rather an upgraded iPad 2 and the real iPad 3 will not be launched until the third quarter of 2012 at the earliest. The iPad 2 upgrade will be thinner than iPad 2, and will offer longer battery life.” Link

Greek Prime Minister George Papandreou lost his majority in Parliament, raising hopes that Mr. Papandreou’s referendum proposal will be killed. – WSJ

AMZN – “launching a digital-book lending library that will be available only to owners of its Kindle and Kindle Fire devices who are also subscribers to its Amazon Prime program..initially offer slightly more than 5,000 titles in the library, including more than 100 current and former national bestsellers, such as Stephen R. Covey’s "The 7 Habits of Highly Effective People." None of the six largest publishers in the U.S. is participating. Link

SNDK – NAND flash contract prices are likely to fall in November and drop further in December, as supply will expand, combined with continued-sluggish demand, according to DRAMeXchange Link

MF – “MF Global Inc.’s commodity customer funds have a shortfall of $633 million, or about 11.6 percent, out of a segregated fund requirement of about $5.4 billion, the Commodity Futures Trading Commission said.” Link

TTWO – Grand Theft Auto V debut trailer. Link

“A Xerox WorkCentre 5150 photocopier is causing angst among Washington’s economics press corps—and some Fed officials. The copier in the Treasury Department room where reporters huddle for Fed releases keeps jamming. On Wednesday, the mischievous machine jammed about a half-dozen times while reporters were trying to make copies of the Fed’s statement. In September, it jammed about 10 times” – WSJ

David Einhorn – “Given the challenging macroeconomic environment, we intend, for the foreseeable future, to continue holding a significant position in gold and other macro hedges in the form of options on higher interest rates and foreign exchange rates, short positions in sovereign debt and sovereign credit-default swaps,” the reinsurer said in a regulatory filing yesterday. Link

Markit Economics said Wednesday its Purchasing Managers’ Index for the 17 nations that use the euro fell to 47.1 in October, from 48.5 in September. The reading means activity has now been shrinking for three months. Link

October ADP 110K vs. 100K est. Prior revised to 116K vs. 91K

The European Financial Stability Facility, the euro zone’s temporary rescue fund, plans to hold off on selling the €3 billion bond to fund the bailout of Ireland due to volatile market conditions, a person familiar with the situation said Wednesday. – WSJ

It added that it has hard disk drive (HDD) inventory until the end of November. "Substitutes for HHD are very few, so if the situation persists, not only notebook production will be affected but also desktops, and other component shipments will also drop," Asustek CFO David Chang told Reuters. He said the prices of HDDs are very mixed at the moment with some prices surging 20-40 percent. Up to half of the global supply of hard drives comes from Thailand. – Reuters

At Amazon, for example, Western Digital’s 1TB Caviar Black has skyrocketed to $199.99, up from around $90 less than a month ago. – Tech Report

Redemption requests, which were due by Oct. 31, totaled less than 8 percent of assets, or roughly $2.4 billion.. Since employees account for half of the fund’s overall assets, the recent withdrawals amount to nearly 16 percent of the outside capital.. Mr. Paulson ventured out on his own in 1994.. produced steady gains, returning an average 16 percent a year in his oldest fund through 2006.. encouraged by consultants like Cliffwater Associates and banks like Morgan Stanley and Bank of America Merrill Lynch. At the start of the year, Paulson & Company oversaw $38 billion compared to just $4 billion in 2007. Link

Business Insider reports on the founding of Groupon with insiders quotes. Link

MF – “Don’t ask me any hard questions,” he joked to a visitor who met with him just days after Mr. Corzine took over in March 2010. “I hadn’t heard of this company a week ago.” On the eve of its collapse, it had about $34 of debt for each $1 of capital it held, according to data from Keefe, Bruyette & Woods. By contrast, Goldman Sachs’ leverage ratio is $13.50 for every $1. In 1994, Mr. Corzine ascended to the top of Goldman Sachs despite hundreds of millions of dollars in trading losses at the bank’s bond unit, which he had overseen. Link

Federal regulators have discovered that hundreds of millions of dollars in customer money has gone missing from MF Global in recent days. Link

CME Group (CME) CEO says has determined MF Global (MF) is not in compliance with customer segregation requirements – Reuters

China Purchasing Managers’ Index fell to 50.4 in October from 51.2 in September, the China Federation of Logistics and Purchasing said in a statement today. That was lower than any of 16 economist estimates in a Bloomberg News survey that had a median forecast of 51.8. Link

The Greek prime minister, George Papandreou, stunned Europe‘s leaders on Monday after he proposed that his country should hold a referendum on the landmark European debt deal reached last week. Greeks have already registered their dislike for the package. Polling has shown that 60% thought it was bad for the country, making the referendum a high stakes gamble for the socialist government. Link

NVDA INTC AMD – Year to year this quarter Intel market share increased (9.5%), AMD broke even, and Nvidia slipped -23% in the overall market partially due to the company withdrawing from the integrated segments. However, Nvidia gained 10.9% in desktop discrete. Link

Panasonic Corp. posted a fiscal second-quarter loss due to restructuring costs in its unprofitable television and semiconductor businesses. The Japanese electronics maker also cut its forecast for the full fiscal year.

The company now forecasts a net loss of ¥420 billion ($5.54 billion) for the fiscal year ending March 2012 and revenue of ¥8.3 trillion. In June, it had forecast a net profit of ¥30 billion and revenue of ¥8.7 trillion for the full fiscal year. Panasonic plans to sell 19 million TV sets this fiscal year, compared with its previous plan to sell 25 million sets. Link

Hon Hai Precision Industry Co. on Monday posted a 9% drop in third-quarter net profit, dragged by relocation costs and flagged that visibility for orders remains poor, highlighting the world’s largest contract maker of electronic products by revenue will likely be weighed by the dour global economic outlook. Link

Markets have over-interpreted comments by incoming European Central Bank chief Mario Draghi on the bank’s readiness to go on buying the bonds of troubled euro zone states, outgoing ECB President Jean-Claude Trichet said. Link

Industrial conglomerate 3M Co. singled out Europe as a chief contributor to its poor third-quarter performance. In Western Europe, 3M saw its organic volumes fall 4% in the third quarter after a flat second quarter and a 4% increase in the first three months of the year. Source: WSJ

Acer originally expected its notebook shipments to remain flat in the fourth quarter of 2011, or rise by up to 5% from the preceding quarter, but now has lowered the fourth-quarter estimate to a decrease by 5-10% on quarter due to short supply of hard disk drives (HDDs) due to the flooding in Thailand.. shortages have caused an increase in HDD prices of 5-20% and Acer has decided to hike prices for its notebooks in November to reflect its increased costs, Wong indicated. Based on a lead time of about two months, the global supply of HDDs will be 25% short of demand from mid-December 2011 to February 2012, according to Taiwan-based notebook ODMs Link

Japan intervened to weaken the yen for the third time this year and pledged more sales after the currency’s gain to a postwar high against the dollar threatened a recovery from the March 11 earthquake and nuclear disaster. Link

Google engineer posts on Jeff Bezos (expand first blog post) Link

NFLX CEO on what went wrong Link

Chanos on Europe and China. He’s still (surprise!) bearish Link

Protestors are probably in in the top global 1% Link

In late 2010, Mr. Corzine started making big bets on bonds issued by European countries. He sometimes placed orders himself based on a list of prices left with an assistant, according to people familiar with the situation. Mr. Corzine, who made his name and fortune as a Treasury bond trader at Goldman, was convinced that sovereign debt from countries like Italy and Spain with high yields was a steal, these people said.

"Europe wouldn’t let these countries go down," Mr. Corzine, who is also chairman of MF Global, told another executive at the New York City company early this year. When the lower-ranking official suggested that the trade was too big, Mr. Corzine brushed the concerns aside, responding that his career on Wall Street and in politics made him confident about the bets.

It was the kind of gutsy trade that helped make Mr. Corzine a star at Goldman in the 1990s. "If it was a good trade for $100, he wanted to make it $1,000 or $1 million," a former colleague recalls.

He set out on a five-year makeover, but it wasn’t easy. Last year, stocks rose, but interest rates that MF Global relies on to profitably lend to clients stayed stubbornly low, hurting profits. "We have to take risks," he said in an interview.

Last year, Mr. Corzine immersed himself in the idea of making bets on European sovereign bonds. He asked colleagues what they thought of the financial situation in Europe, talked to MF Global’s risk officers and board of directors, and then starting putting on the trades in September, according to people familiar with the situation.

Mr. Corzine oversaw the European sovereign-debt trades largely on his own even after hiring a new trading chief earlier this year, a person familiar with the matter says. In one quarter where the trade worked well, it represented 12% of the firm’s revenues, according to Christopher Allen, an analyst with Evercore Partners Inc. Mr. Corzine regularly reviewed the positions with the company’s directors, and he was allowed by the board several times to increase MF Global’s exposure to Europe, these people said.

Investors in debt issued by MF Global were pleased, too. In August, they lent the company money at a lower interest rate if Mr. Corzine stayed at the company instead of leaving for a federal-government post, such as Treasury secretary.

One person who has worked with Mr. Corzine at MF Global says he was uncomfortable that so much of the firm’s strategy essentially boiled down to a bet by Mr. Corzine on European bonds. "There was no one else at the firm who was helping him think about what to do on this trade," this person says. Link

Barton Biggs, the hedge fund manager who bought stocks when the market bottomed in 2009, boosted bullish bets on equities in his Traxis Global Equity Macro Fund after European leaders took action to contain the debt crisis. Link

It didn’t hurt that Caterpillar saw the recession coming more clearly than most large companies. Top management, realizing the company’s susceptibility to GDP shifts, had once asked Cat economists to find a leading indicator. "We’ve got good news and bad news," the economists reported, as CFO Rapp tells it. "The good news is, we found an indicator that predicts shifts in U.S. GDP with a lead time of six to nine months. The bad news is, it’s our own sales to users." Using that metric, Cat anticipated the U.S. recession coming in the third quarter of 2007 and said so publicly, triggering a 2.6% one-day drop in the S&P 500. Link

Soros – said that the 50pc "haircut" on private bond holders would only reduce Greek debt by 20pc.. "It will bring relief partly because the markets were so obsessed by the lack of leadership. The mere fact that something was achieved was a major relief and it will be good for any time from one day to three months. Link

Bill Ackman Lecture “If you’re so smart, why aren’t you rich?” Link

Hedge funds reduced bets that stocks will rise to almost the lowest level since 2009 this week, according to International Strategy & Investment Group. ISI’s index of “net exposure” to stocks slipped to 44.7 on Wednesday, compared with its 2011 high of 54.2 in February, according to a note sent to clients. The measure climbed to 45.5 on Oct. 12 after declining to 44 on Sept. 21, the lowest level since April 2009. Link

Chinese and European officials sought to play down expectations about when and how China may deploy its vast financial resources to help bail out indebted countries in Europe. A Chinese Vice Finance Minister said China must first see the details of a new European bailout fund before making any commitments. "We of course must wait until its structure is extremely clear," Zhu Guangyao told a press briefing. "And moreover, this investment must be decided on after serious, technical discussions." Jin Liqun, chairman of sovereign wealth fund China Investment Corp., made clear in London last month that CIC wouldn’t offer handouts. "The $3 trillion in reserves are the fruits of the hard work of the Chinese people," he said. "We’re willing to work with those European countries in distress for a better solution. But…we have to be accountable to the people." Link

WHR – "During the quarter, we experienced weaker than expected global industry demand and elevated material costs," said Jeff M. Fettig, Whirlpool Corporation chairman and chief executive officer.  "Consumers continue to show strong preference for our unmatched global brand portfolio and new product innovations, and we are beginning to see the benefits from previously announced price increases.  However, our results were negatively impacted by recessionary demand levels in developed countries, a slowdown in emerging markets and high levels of inflation in material costs. 

Top European Central Bank officials offered a skeptical appraisal of Europe’s latest plan to solve its debt crisis, suggesting that the central bank may be forced to maintain the emergency measures it has adopted to keep the problems from spreading.

The ECB purchased Spanish and Italian government bonds on Thursday, a trader said, hours after European leaders inked a three-pronged deal they hope will solve the region’s debt crisis through a mix of Greek debt restructuring, bank recapitalizations and leverage of Europe’s bailout fund to give it extra firepower. Details still need to be ironed out, which could take weeks.

Despite the show of support from the ECB, Italian government-bond yields fell only modestly Thursday, suggesting investors still have doubts about whether the package will ultimately work. Link

“Companies have recently raised prices for their external hard drives by 10-20%, amid speculation that recent flooding in Thailand might cause tight supply for HDDs and related components, according to industry sources… potential HDD and key component shortages might propel demand for solid state drives (SSD) in consumer PCs, the sources indicated.” Link

“Asustek Computer and Gigabyte Technology, facing weak market demand in Europe, the US and China, are expected to fail to achieve their motherboard shipment goals for 2011 and only ship 22 million and 17.5-18 million units, respectively, about one million units less than their original targets” Link

New ECB head: "The Eurosystem (of central banks) is determined, with its non-conventional measures, to prevent malfunctioning in the money and financial markets creating an obstacle to monetary transmission," he said in typically coded ECB language in a speech text released in Rome.” Link

Chinese Premier Wen Jiabao said that economic policy will be fine-tuned as needed and the industry ministry said it is studying “stimulative policies” for smaller companies as a global slowdown threatens growth. Link

AMD NVDA – “Since high-end discrete graphics cards are currently seeing weakening sales, while demand for mid-range and entry-level graphics cards is gradually being replaced by AMD and Intel’s GPU-integrated processors” Link

A common study habit—the all-nighter—is a bad idea. Although 60% of college students stay up all night at some point in school, the practice is linked to lower grades, says Pamela Thacher, an associate professor of psychology at St. Lawrence University in Canton, N.Y., based on a 2008 study of 120 students. It also impairs reasoning and memory for as long as four days. Link

MMM – “The business environment remains challenging, as the economic softening that we experienced late in the second quarter continued into the third,” said George W. Buckley, 3M chairman, president and chief executive officer. “While growth rates were good across much of our portfolio, LCD TV remained weak and momentum slowed in other parts of electronics following several quarters of very good growth. In addition, ongoing policy uncertainty and austerity are affecting growth in Western Europe, which reduced sales in the quarter. As is typical, we are seeing the impact of these changes earlier than most as our customers decrease production in order to lower their inventories. Conversely, we should benefit more quickly when those markets recover.”

"The quarter turned out to be a very different one than what we expected," 3M Chief Executive George Buckley told analysts on a conference call. "Cause No. 1 was worries about European sovereign debt and the European economy. Cause No. 2 was the rapid contraction of the electronics end markets."

MMM “Canary in coal mine about the economy?” Link

Notes from a session with Felix Zulauf. Link

A celebration of Steve’s life video. Link

Apple’s Jon Ive interview excerpts. Link

Barrons: Trouble at Fairholme. Crazy story how he hires a guy with no investment experience to be his #2. Link

More Jobs book excerpts. Link

DeMark on a SP500 bull-trap. Link

Fortune writer reminisces about Steve Jobs. Link