"The fact that people will be full of greed, fear or folly is
predictable. The sequence is not predicatable."  - Warren Buffett


Stingy Links
http://www.stingyinvestor.com/SI/articles/articlearchive.shtml

Why subprime lenders are in trouble
http://www.businessweek.com/bwdaily/dnflash/content/mar2007/db20070302_477856.htm?chan=top+news_top+news+index_businessweek+exclusives
"As the subprime mortgage market goes into steep decline, threatening to
drag the whole economy along with it, many people are wondering what could
have gone so wrong so quickly. Until recently, after all, delinquency and
foreclosure rates on subprime loans were reassuringly low. The answer may
lie in how the quality of these mortgages has changed over the years. While
subprime is the term used for loans issued to people with poor credit,
not all subprime loans are created equal. And the subprime loans that were
originated in 2006 that are turning out to be shockingly weak."

Big insider-trading bust
http://www.businessweek.com/bwdaily/dnflash/content/mar2007/db20070301_941827.htm?chan=top+news_top+news+index_top+story
"The case involves allegations that hedge funds bought information about
impending rating changes on stocks from an executive at UBS, got tips about
upcoming corporate mergers from a former Morgan Stanley compliance
officer, and paid a Bank of America broker for the right to get shares in hot
initial public offerings. There's even a charge that some day traders, who
had gotten wind of the alleged activities, were shaking down other traders
for money to keep secret their role in the purported insider-trading
scheme."

Berkshire Hathaway's 5-star stocks
http://news.morningstar.com/article/printArticle.asp?id=186894
"In its recent filing, Berkshire disclosed three new positions:
Ingersoll-Rand Company (IR), United Healthcare (UNH), and US Bancorp (USB). It should
be noted that Berkshire had been accumulating its stake in US Bancorp
since early 2006 but had been granted permission to delay the filing of this
position over the last couple of quarters. Berkshire also modestly boosted
its stake in Wells Fargo (WFC) and USG (USG)."

Berkshire Hathaway annual for 2006
http://www.berkshirehathaway.com/2006ar/2006ar.pdf
"Let me end this section by telling you about one of the good guys of Wall
Street, my long-time friend Walter Schloss, who last year turned 90. From
1956 to 2002, Walter managed a remarkably successful investment
partnership, from which he took not a dime unless his investors made money. My
admiration for Walter, it should be noted, is not based on hindsight. A full
fifty years ago, Walter was my sole recommendation to a St. Louis family who
wanted an honest and able investment manager."

A devilish delusion
http://www.bankstocks.com/article.asp?type=1&id=9881307
"In 1982, the Academy Award for Best Costume Design went to a film called
Chariots of Fire, the story of a couple of upper-class Brits as they
trained for and competed in the 1924 Paris Olympics. (You had to be there.) The
movie was the year's big hit; it won a slew of awards, including Best
Picture. Have you seen Chariots of Fire? It's about track and field; the
actors basically spend the bulk of the movie running around in their underwear.
Bam - give'em the costumes Oscar!"

The sure thing almost nobody plays
http://www.loc.gov/catdir/samples/simon052/98014660.html
"Imagine you are entering a deluxe, well-appointed casino. Off the lavish
entry foyer, there are two ample gambling wings, one hued in reds, the
other in muted greens. The red wing looks enticing, but if I may insist, let's
first enter the less crowded green rooms to watch the action. The
atmosphere is unhurried, the blackjack tables are sparsely attended, and every
player sits behind a mound of green and black chips. You think at first
you've come to the wrong place. You see the ordinary table limits, the
ordinary clothes, the ordinary games. But then how did these ordinary people get
such piles of money? Then it comes to you. They're all winning. In fact,
as you walk around the green wing, you hardly can find a losing player. You
know, of course, that the average house take on table games is 5%, but as
you count winning and losing hands, you realize these players are getting
a better break. They seem to be gaining at a rate of 60% to 40%. You
start fresh and take another count. The results are the same. A pit boss
appears at your shoulder. "Excuse me," you say, "but can this be right? The
odds favor the players?" "Yes, indeed. The odds in the green room usually run
60 to 40. It's been that way since we opened." "But...most of the players
must go away winners." "They sure do. At those odds, we calculate that
9,999 out of 10,000 make money. At our high-stakes tables in the back, they
do even better, with winners running about 20,000 to 1. It's a good thing
we get so few players, or they'd break the house." Somewhat amazed, you
thank him and shake your head. There's no time to lose, you decide, but
you'll need more than the few dollars you have in your pocket. You hatch a
plan to gather your life savings, come back to the casino, and win the bundle
you've been dreaming of. On your way out, you glance into the red wing.
The action level is much, much higher. The room is crowded and fairly roars
with excitement. Can it be even better here, you wonder? Curious, you go
in. Players bet multiple table positions, wave frantically for change,
entreat the gods for luck. You see few green and black chips, fewer winning
players. The piles of chips in front of them are dwindling with each hand.
In fact, the odds are worse than normal. Again, you start to count.
Although the players continue to excitedly toss in their chips, the odds appear
to be maybe 60 to 40 in favor of the house. Once more, your curiosity
whetted, you walk over to a pit boss and ask her the odds at these tables. She
tells you what you suspected. They are 60 to 40 in favor of the casino.
Warming up to the subject, she chuckles and says, "This room coins gold for
the casino, the chances are 9,999 in 10,000 rounds that we wind up
winners." You don't have to be a genius to see that this is obviously not the
place you want to be. You go home and get your stash. You return to the
casino with your fistful of money, excited, eager for action, all the time
figuring how you'll do even better at the game. But then a strange thing
happens. You walk into the red wing and start to play."

Are good companies bad investments?
http://money.cnn.com/magazines/fortune/fortune_archive/2007/03/05/8401291/index.htm?postversion=2007022606
"From 1983 to 2006, the mean annualized return of the less admired
companies was 17.8 percent, beating the more admired group's 15.4 percent return.
Interestingly, both groups beat the S&P 500's 11.2 percent return over the
same period."

Stocks of admired companies and despised ones
http://business.scu.edu/finance/faculty/statman/articles/fortune020907.pdf
"Do stocks of admired companies yield admirable returns? We study Fortune
magazine's annual list of "America's Most Admired Companies" and find that
stocks of admired companies had lower returns, on average, than stocks of
despised companies during the 23 years from April 1983 through March 2006.
We link differences between the returns of stocks of admired and despised
companies to differences in affect, the quick feeling that distinguishes
good from bad, admired from despised. The affect of admired companies is
positive, and investors who were attracted by affect to stocks of admired
companies paid for it with lower returns. However, the relative returns of
stocks of admired and despised companies varied considerably from year to
year and from decade to decade and the relationship between admiration and
returns is not always monotonic."


S&P/TSX60 Value Screens
http://www.stingyinvestor.com/SI/strategy.shtml 

High Dividend Yield Stocks                     P/E P/B P/S P/C P/D Yield*
============================================== === === === === === ======
BCE (BCE)                                       4   4   4   5   5    5
Transalta (TA)                                  1   5   3   4   5    5
Bank of Montreal (BMO)                          4   4   3   3   5    5
TransCanada (TRP)                               3   4   2   4   5    5
Bank of Nova Scotia (BNS)                       3   3   3   2   5    5
National Bank of Canada (NA)                    4   4   3   2   5    5
Enbridge (ENB)                                  2   2   4   3   5    5
Toronto Dominion Bank (TD)                      3   3   3   2   5    5
Royal Bank (RY)                                 3   2   3   2   4    4
CIBC (CM)                                       4   2   3   2   4    4
More Info: http://www.stingyinvestor.com/SI/strategy/dogs.shtml 

Value Ratio Stocks                             P/E P/B P/S P/C P/D  VR
============================================== === === === === === =====
BCE (BCE)                                       4   4   4   5   5   2.7
Teck Cominco Limited (TCK.B)                    5   3   2   3   4   2.7
Bank of Montreal (BMO)                          4   4   3   3   5   3.4
National Bank of Canada (NA)                    4   4   3   2   5   3.7
Encana (ECA)                                    5   4   2   4   3   4.1
Bank of Nova Scotia (BNS)                       3   3   3   2   5   4.1
Husky Energy (HSE)                              5   2   2   4   4   4.1
TransCanada (TRP)                               3   4   2   4   5   4.6
CIBC (CM)                                       4   2   3   2   4   4.8
Toronto Dominion Bank (TD)                      3   3   3   2   5   5.1
More Info: http://www.stingyinvestor.com/SI/strategy/valueratio.shtml 

Graham Stocks                                  P/E P/B P/D   G$   dG$(%)
============================================== === === === ====== ======
Domtar (DTC)                                    5   5   0   14.67  51.25
Encana (ECA)                                    5   4   3   63.72  15.31
Lundin Mining Corporation (LUN)                 4   5   0   13.04   8.68
Magna Cl.A (MG.A)                               3   5   2   89.77   4.80
Teck Cominco Limited (TCK.B)                    5   3   4   83.42   3.98
Weston George (WN)                              4   5   3   73.28   3.58
Ipsco (IPS)                                     5   3   1  126.09   2.38
More Info: http://www.stingyinvestor.com/SI/strategy/graham.shtml 

*Notes: http://www.stingyinvestor.com/SI/strategy/notes.shtml 


Books for Stingy Investors

Contrarian Investment Strategies: The Next Generation
by David Dreman

David Dreman has provided perhaps the best modern book on value
investing and the markets. He goes from the basics through to
advanced topics and the sheer amount of useful information in his
book is remarkable. As an added bonus, Dreman's writing is clear
and approachable - a feat rarely seen in investing books. All
but the most grizzled market veteran will pick up a few good ideas
from Contrarian Investment Strategies: The Next Generation.
Amazon Link: http://www.amazon.ca/exec/obidos/ASIN/0684813505/


Stock Research From Dan Hallett & Associates

The Rothery Report
http://www.stingyinvestor.com/SI/store.shtml 

The Rothery Report provides research on select deep-value stocks in
North America. Discover overlooked and undervalued stocks in quarterly
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Rothery Report Performance (03/31/2001 to 12/31/2006)
  Average Capital Gain    Average Holding Period
    Sold Stocks: 76.6%      Sold Stocks: 2.0 Years
    All Stocks: 50.8%       All Stocks: 2.3 Years

Special Bonus Reports: Top Smaller Stocks 2007
http://www.stingyinvestor.com/SI/store/TopSmallStocks.shtml

Learn More
http://www.stingyinvestor.com/SI/store.shtml

Subscribe Today
http://www.stingyinvestor.com/SI/store/order.shtml 



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ISSN 1499-2795 Copyright Dan Hallett and Associates Inc., 2007.
All rights reserved. The securities mentioned in this report are not
appropriate for all investors. Consult your professional investment
advisor before making any investment decision.  While all reasonable
effort is made to ensure the accuracy of information and data
contained herein, accuracy can not be guaranteed. Past performance is
not a good predictor of future performance.  Results are not
guaranteed and we assume no liability whatsoever for any material
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information in this newsletter, and in its related website, is not
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recommendations.  Investing in stocks can be risky and may result in
substantial losses.  A Dan Hallett and Associates Inc.(DH&A)
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securities mentioned.