tag:blogger.com,1999:blog-41123642073576038792024-03-13T06:53:26.878-07:00Top Stock PicksUnknownnoreply@blogger.comBlogger33125tag:blogger.com,1999:blog-4112364207357603879.post-23994166214945588302015-02-04T20:22:00.000-08:002015-02-04T20:22:52.068-08:00National Bank of GreeceWith the political uncertainty in Greece, right now is an excellent time to pick up some NBG positions. It's currently trading at 1.43 with earnings posted at .98/share. If you have extra capital that can be tied up for a few months you could quite possibly make a nice profit on this one. NBG is the largest commercial bank in Greece and will more than likely see their stock price multiply by next year.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-65243355523425990222014-01-29T19:34:00.000-08:002014-01-29T19:34:05.124-08:00Credit Card Companies, Which one is the BestIf you have followed the major credit card companies profiles than you already know Mastercard and Visa have made decent strides since their IPO's a few years back, Visa more so than Mastercard. But comparing them in today's market and including American Express, which one is the best investment going forward? If we look at the earnings they all look positive and healthy among all three, although when you compare earnings per share Mastercard jumps ahead at over $25.00 per share compared to $7.47 (V) and $4.92 (AXP). Dividends are all close with American Express winning slightly with a little over 1% of the share price annually. AXP also takes the P/E ratio with the lowest at 17.6 which points to it being the most "valuable" of the three. We can continue to compare statistics without any one of the three jumping off the page in comparison so ultimately it comes down to opinion. I believe investing in any one of the three is a solid investment and will reap rewards in the future. The charts for all three are headed north with no slowing down in sight. If I had to pick one of them it would be American Express. The fact that it has the lowest price to earnings ratio as well as the overall business model of AXP just makes it the favorite in my eyes. American Express generally focuses on higher earning customers, which almost always translates into less bad debt as their customers are better in a position to make the payments. Not that Visa or Mastercard would be a bad investment decision and I'm sure someone could make arguments as to favor either one of them. Anyone have any thoughts? Which one do you see pulling ahead of the others?Unknownnoreply@blogger.com1tag:blogger.com,1999:blog-4112364207357603879.post-17038058551452035442014-01-21T15:12:00.003-08:002014-01-27T12:08:23.715-08:00MJNA will the hype push it higher?For those of you who haven't heard of MJNA, or <a href="http://www.medicalmarijuanainc.com/">medical marijuana incorporated</a>, they are a company that makes hemp products such as hemp oil and cannabis gum among others. They also "evaluate and purchase value-added companies and products" as it states on their website. Right now MJNA is trading at a dismal 0.19 but it does seem to be heading upward, most likely due to all of the hype with Colorado legalizing recreational marijuana. Even though that's not really what the company is involved in. Is it a buy or sell? I picked up some shares anticipating the hype of legalization pushing the price higher. After evaluating the charts and reading a little more about the company I think we will see a rise in value. Be cautious though, I look for this one to be a bumpy ride that may not end up on top. Just to share with you what I am looking for in this investment, I purchased it at .19 and will probably set up a sell limit order at .29 or so depending on how it moves this week. That will result in close to a 50% profit if it pans out that way. I would advise against putting a large percentage of your portfolio in MJNA, but if you have a little extra cash and want to take a chance on it then go for it. My personal investment in this one is only a fraction of one percent of my portfolio just to give an idea.</br>
</br>
<b>UPDATE</b>:
I wanted to post an update to this one. Today is January 27th and MJNA has jumped to 0.39 as of right now, original post was January 21st so it has doubled in less than a week. Given the recent jump and the magnitude of the jump in price, I have decided to hold onto it for a while and see how high it will go. In my particular case, I have put a stop-loss order in at .29 since that was my original goal. If the price continues to rise I will gradually increase my stop-loss price trailing .08 to .10 of the current price. The way it is looking MJNA may very likely continue to increase in price so it may not be too late to buy into it. But again be aware that this is a very volatile stock so expect sharp jumps and dips.Unknownnoreply@blogger.com1tag:blogger.com,1999:blog-4112364207357603879.post-11499575715817361622014-01-20T16:07:00.002-08:002014-01-21T15:23:36.101-08:00Gold in 2014 Buy, Sell, or Hold?The price of gold took a drop in 2013 which could point to an opportunity to pick gold up at a valuable price in 2014, or it could signal that gold has been overpriced and it is now coming back to normal. Which one is it? That is the big question. In my opinion, I look for gold to stay relatively even throughout 2014 and end the year close to where it is at now at $1254.10 per ounce or maybe slightly higher. I think we will see gains and drops throughout the year but in the end it will stay relatively close to where we are starting out and hit no more than $1450 as the high for the year before settling back down to end between $1250 and $1300. I believe gold as a long term investment is questionable and personally I chose not to include it in my portfolio. I guess I see it as an "old school" investment that isn't usable other than to sell it to another speculative investor. It doesn't do anything, doesn't generate a profit through wise business decisions, it can't be any more than it already is - which is speculation on future value to other speculators. With the world economy the way it is, the ability to transfer funds across the world in an instant, and even new types of world currency such as BitCoin surfacing, gold just seems out of date. I look for gold to hold on for a few more years, staying relatively close to the current price within the next 10 years or so. And ultimately becoming less and less valuable in the more distant future. I think you could buy under $1250 with the intention to sell within the year and come out ok, hold what you have if you already have holdings in gold, but I wouldn't sell until the price takes an uptick later in the year. Wait for $1300 to $1350 to sell. Here is an article from <a href="http://www.marketwatch.com/">Market Watch</a> on the topic.<br />
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UPDATE: Gold up, but
improving flows don't convince all</h1>
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<span class="wsod-sh1">MarketWatch - 4:18 PM
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By Barbara Kollmeyer, MarketWatch
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MADRID (MarketWatch) -- Gold prices moved higher in electronic trading on
Monday, building on gains seen last week amid signs of improving investment
flows, though some analysts worried that those gains could short out if Chinese
demand doesn't come through as expected.<br />
<br />
Gold for February delivery (GCG4) rose $2.20, or 0.2%, to $1.254.10 an ounce,
after gaining $11.70 to settle at $1,251.90 an ounce on Friday.<br />
<br />
March silver (SIH4) added 1cent to $20.31 an ounce, adding to a gain of 1.3%
on Friday and a 0.4% rise for the week.<br />
<br />
In observance of the Martin Luther King Jr. holiday, trading floors were
closed for Monday. Electronic trading for metals and energy futures ended at
1:15 p.m. Eastern and will reopen again at 6 p.m. Eastern.
<br />
Gold ETFs tracked by Bloomberg saw inflows of 7.4 tons on Friday, the highest
daily amount since October 2012, said analysts at Commerzbank in a note on
Monday. They added that much of that gain was driven by the SPDR Gold Trust
(GLD).<br />
<br />
"If this turns out to signal a trend reversal, it is likely to lend buoyancy
to the gold price," said the Commerzbank analysts in a note. "The high outflows
from the gold ETFs observed since the beginning of last year were one major
reason for the weak gold price." <br />
The analysts also noted that speculative financial investors are more
optimistic about gold again. In the week ending Jan. 14, those investors
expanded their net long positions for the third consecutive week to 28,300
contracts, the highest level in eight weeks.<br />
<br />
There are some shaky signs to this potential rebound for gold, though.
<br />
"The metals continue to track the performance of the equity markets, which
despite posting a green print on Friday, the breadth was limited to a few large
cap stocks," said Peter Hug, global trading director at Kitco Metals. "Overall,
the equity market is struggling to validate value and capital flows have again
'ebbed' into the metals."<br />
<br />
Fawad Razaqzada, technical analyst with Forex.com, said in a note that after
a 28% drop in gold last year, gold has probably been boosted by expectations
cheaper prices will result in higher demand from China ahead of the Lunar New
Year holidays, which begin Jan. 31.
<br />
Data on Chinese imports due midweek will be analyzed to determine the
strength of that Chinese appetite.
<br />
Net long positions were also built up for other metals as well, noted
Commerzbank, but also investors were looking ahead to a looming strike.<br />
<br />
Platinum for April delivery (PLJ4) jumped $14.90, or 1%, to $1,469.00 an
ounce. Members of South Africa's Association of Mineworkers and Construction
Union (AMCU) over the weekend reportedly voted to strike this Thursday at the
world's top platinum producer, Anglo American
Platinum Ltd. , as well as Lonmin PLC (<a class="wsod-bold wsod-symbolLink" href="https://www.blogger.com/customer/sharebuilder/Stocks/Snapshot?symbol=LNMIY">LNMIY</a>) and Impala
Platinum Holdings Ltd (<a class="wsod-bold wsod-symbolLink" href="https://www.blogger.com/customer/sharebuilder/Stocks/Snapshot?symbol=IMPUY">IMPUY</a>). .
<br />
"The strike action will see effects on palladium and rhodium supplies as
well, while the AMCU has indicated to their members involved with gold
production that they will also be given a strike mandate.," said Kitco's Hug.
"The story has potentially profound issues in a market where the PGMs
(platinum-group metals) are expected to be in supply deficits, pre-strike, but
caution is urged as historically these actions have been short lived."<br />
<br />
At the moment, noted Commerzbank, platinum costs over $200 per troy ounce
over gold, and the last time the price gap was this wide was July 2011.<br />
<br />
March palladium (PAH4) rose to $748.55 an ounce, while high-grade copper for
March delivery (HGH4) was ended at $3.34 a pound, little changed on the day.
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Unknownnoreply@blogger.com4tag:blogger.com,1999:blog-4112364207357603879.post-72465321935958483152014-01-17T18:02:00.001-08:002014-01-17T18:06:09.264-08:00Coca Cola, KO not moving since splitI was poking around on Twitter earlier today and got onto a debate about Coca Cola (KO). <a href="http://warriorinvest.com/">Warrior Investments</a> (@warriorinvest) tweeted that KO is a strong sell and cited that coke is on the wrong side of the soda consumption trend in North America. While I do agree that North America is trending away from soda, there are other factors that one must consider when deciding on investing in KO. On the downside you have the fact that KO hasn't made much progress in the stock price since the 2 for 1 split, and the point that Warrior Investments made about the N.A. soda trend. But on the positive KO is in something like 179 countries, and you have to consider that they realize the trending in North America and are most likely working on new products that will be better accepted, possibly healthier alternatives to the sugary drink to satisfy the demands of the market. I am not willing to say you should go out and buy up a bunch of KO stock, but I certainly am not against buying it either. KO is a solid company with good management, I am not selling my holdings in KO. I would recommend either holding what you have or if you're thinking of buying, go ahead, I don't see it dropping too far anytime soon and I think it is a great long term investment if you're looking to balance your portfolio.Unknownnoreply@blogger.com1tag:blogger.com,1999:blog-4112364207357603879.post-30743878811959845612014-01-16T17:26:00.001-08:002014-01-16T17:26:25.087-08:00Banco Marco S.A. (BMA)Banco Marco(BMA) is not necessarily a well known name in the US, you can pick up shares through the NYSE as ADR shares. It is a leading bank in Argentina with the most extensive private sector branch in the country. BMA provides general banking services to a nationwide customer base. Banco Marco from South America has seen a 52 week high of 32.85 in October and has since dropped down to 22.53 as of today. Even though it has fallen throughout the last couple of months it will soon be on the rise again. Overall since last year it is up 28% even considering the recent drop which is not too shabby. Some of the leading stock ratings companies have buy or strong buy ratings on BMA, Sabriet Investment Research has them listed as a "strong buy" while others such as The Street rate it a "buy". I would expect to see BMA reach its previous 52 week high of 32 per share sometime during 2014. If you do the math that's over a 40% gain if you were to buy near today's quoted price. Right now BMA has a P/E of 3.6 which shows good valuation and a return on equity of over 25% which shows good management efficiency. On another positive note, it has a market cap of over 1.3 billion dollars. Generally you can relate the mid and larger cap stocks to being less volatile due to the large spread of wealth distributed amongst more investors and investment firms. I say buy it, but then again for some reason I usually have a soft spot for stocks in the financial sector. At least in this case there are many ratings firms that agree, this one is a "buy". Happy investing, and good luck.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-40296982836319516572014-01-15T23:19:00.002-08:002014-01-15T23:19:50.559-08:00AZZ, will they rebound after last earnings announcementAZZ is one company that I have been following and investing in for some time now. They just released third quarter earnings which were lower than expectations. The stock price dropped 15 percent, down to just over 40 per share. Given their track record for continually increasing revenue and net profit numbers along with their obvious desire to continue expanding the reach of their respective industry this should be seen as a great time to get into AZZ. It won't be long before it is on the rise again, over the last 10 years the stock price has increased over 1000 percent. Yes that was one thousand not a typo. Solid company with a solid future, get in while the price is still low and look for a substantial increase after earnings report of first quarter which will be around June.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-62276836996190002272014-01-09T19:41:00.003-08:002014-01-09T19:55:20.143-08:00Recap on my picks from 5 years agoSo i was going through some of the old blog posts earlier today and I must say I am a little impressed with myself. Most of these posts were from 2009. SIRI, Sirius Satellite Radio I said buy when it was just under a dollar and facing delisting from Nasdaq, and that when it surpasses the dollar mark it would take off. It is at 3.79 and it surpassed the 4 dollar mark a couple months ago. AZZ, AZZ Incorporated I said was a buy and since that post it is up over 250%. Ford I couldn't buy enough of at under 4 per share and i estimated 15 per share and it's there now. Ok, enough tooting my own horn here are a couple for the future. I am really liking XIN, it just dropped to under 5 dollars. I think we will see it go to 8, possibly 10 dollars in the next couple years. NBG, another one I think we will see gradually increasing. For the long term I wouldn't be surprised to see it go from the 6 dollar range to over 20 dollars possibly more depending on how long you are willing to wait. I think AZZ is still a good bet, it's continually growing and not afraid to invest in expanding the reach in their market. SRCE, 1st Source Bank is another one with a bright future. They have recently seen a boom in the price so I wouldn't buy just yet. But when the price rebounds to around 28 dollars I would buy and expect it to climb back to 35 dollars or more. I am going to be looking forward to reviewing this post in a couple years to see if I nailed it too, but relax, I am confident it will be close. Thanks for reading, and subscribe for future updates.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-90679950517496013112014-01-05T15:45:00.000-08:002014-01-09T19:07:11.475-08:00How to Start Buying StocksI thought i would post this for any readers thinking about investing in the stock market but not sure where to start. There are a few ways to go about it. You could go and talk to a local investment specialist. Going this route will give you personalized advice but it is one of the more costly ways to start. There are many online brokers with excellent information for beginners at a much more affordable price. Etrade is good, they have reasonable fees and good charts and company information. My personal favorite is sharebuilder. At sharebuilder there are no minimums on the purchases and no minimum starting account balance. So you could literally start with just a few dollars. Scotttrade is another popular one with great charts and stats. Some of these sites run ads on this blog if it is something that you may be interested in. Whichever way you decide to start, don't be afraid to dive in. It's really not that difficult. The only advice that holds true to almost any stock is to look at the profit margin and make sure the company is profitable. Sure there are some stocks that will go up when the company isn't turning a profit but those are more risky and better left to experienced traders.Unknownnoreply@blogger.com1tag:blogger.com,1999:blog-4112364207357603879.post-62726112966162010792013-12-31T12:57:00.000-08:002014-01-02T17:44:04.366-08:00REIT's To Buy or Not To Buy This YearI, like many investors, were drawn toward REIT's due to the high dividends and rather constant charts until recently but the question is did the REIT bubble pop or will we see recovery in the coming year. REIT's, for those of you who aren't familiar, are real estate investment trusts. They invest in real estate and/or mortgages, have special tax breaks, and usually pay out a considerable portion of their profit as dividends to the stock holders. I have a few in my portfolio, MFA, NLY, ARR, and at one time WAC which I sold after they were no longer classified as an REIT.<br />
<br />
So far the dividends that I have received have covered the recent loss in value. So what does the future hold for these high dividend stocks? I believe that given the recent drop in price now would be a great time to buy. I think the economy is headed upward in 2014 which will bring even more stability to a still recovering housing market.<br />
<br />
With the dividend percentage being as high as it is on these particular stocks it gives you a little more cushion when the value takes a dip. As of today, ARR is paying over 15%, NLY is just over 12%, and MFA is over 11%. At these rates, even if the REIT market holds steady (which it should), you are still making well over 10% a year. Add into that the probability of an increase in value it's a no brainer for me. Even in the off chance it does drop in value, it would have to completely plummet to reach the pitiful rates that CD's and money markets are paying out. If you are going to invest in CD's you might as well hide your money under your mattress, but that's another topic.<br />
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In closing, I believe if you do your research and chose a reliable REIT you won't go wrong this year. So buy, buy ,buy on REIT's in early 2014.<br />
<br />
7Q8DYRYJZE28Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-18737379847799121392013-12-30T15:01:00.000-08:002013-12-30T15:02:27.280-08:00Warren Buffett on Simple Retirement AdviceI found this article on The Motley Fool and thought it was excellent advice on picking investments that have overall reduced costs associated with them.<br><br>
<i>Warren Buffett's Super-Simple Retirement Advice
</i><br>
Warren Buffett might as well be king of the investment industry. He produced the best returns the world has ever seen working from his house in Omaha, not a desk on Wall Street.
And for that reason, so many people want his advice on how to invest for retirement. They want to hear from someone like them -- someone who doesn't spend every waking moment in Manhattan.
What would Buffett do?
At the 2004 Berkshire Hathaway (NYSE: BRK-A ) (NYSE: BRK-B ) shareholders meeting, Buffett was asked by one investor if he should buy Berkshire, invest in an index fund, or hire a broker.
Buffett delivered with his typical, common-sense rationale:
"We never recommend buying or selling Berkshire. Among the various propositions offered to you, if you invested in a very low cost index fund -- where you don't put the money in at one time, but average in over 10 years -- you'll do better than 90% of people who start investing at the same time."
An index fund? That's what the best stock picker in the world recommends?
Yes, and it wasn't the first time he answered with such simplicity. In another question-and-answer session, Buffett made his stance plain and clear:
"If you like spending 6-8 hours per week working on investments, do it. If you don't, then dollar-cost average into index funds. This accomplishes diversification across assets and time, two very important things."
So, let's get to the specifics. What's Buffett's favorite index fund?
"Just pick a broad index like the S&P 500. Don't put your money in all at once; do it over a period of time. I recommend John Bogle's books -- any investor in funds should read them. They have all you need to know.
Vanguard. Reliable, low cost. If you're not professional, you are thus an amateur. [F]orget it and go back to work."
Why is Buffett so keen on index funds? They're cheap. In fact, Vanguard's S&P 500 ETF (NYSEMKT: VOO ) provides a way for investors to own a slice of 500 of the largest businesses traded on the public stock markets, including Berkshire Hathaway, at a cost of just 0.05% per year. On a $100,000 investment, fees would tally to only $50 per year, compared to $1,310 for the average large-cap mutual fund.
Over time, lower fees and expenses help your money compound faster. Just look how Vanguard's low-cost ETFs stack up to the alternatives:
Add in Vanguard's other popular ETFs, like its Vanguard FTSE All-World ex-US ETF (NYSEMKT: VEU ) fund, which tracks international stocks, and its Vanguard Total Bond Market ETF (NYSEMKT: BND ) for bond exposure, and you'll have a more balanced investment portfolio than many who hire the help of a broker.
Avoid this big mistake
Buffett's pretty keen on helping people avoid big mistakes, just as he's all for helping investors make better decisions. Saying it as simply as he could, he opined on how having cash is one of the worst investments you could ever make:
The one thing I will tell you is the worst investment you can have is cash. Everybody is talking about cash being king and all that sort of thing. Cash is going to become worth less over time. But good businesses are going to become worth more over time.
Of course, that's not to say that having a cash buffer for emergencies is a bad thing. However, having piles of cash -- tens upon tens of thousands of dollars in cash -- is a great way to guarantee a terrible return on a very large pile of money.
More thoughtful insights from the Oracle of Omaha
Warren Buffett has shared wisdom worth billions in his annual letters to Berkshire shareholders. Luckily, his smarts are free for the taking. You can tap into the best of Warren Buffett's wisdom in a new special report from The Motley Fool. Click here now for a free copy of this invaluable report.
Fool contributor Jordan Wathen has no position in any stocks mentioned. The Motley Fool recommends Berkshire Hathaway. The Motley Fool owns shares of Berkshire Hathaway. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Source: <a href="http://www.fool.com/investing/general/2013/12/30/warren-buffetts-super-simple-retirement-advice.aspx?source=ihpsitth0000001&lidx=7">The Motley Fool</a>
Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-200807304672012832013-12-28T17:08:00.000-08:002013-12-30T15:03:59.130-08:00Stocks of interest in 2014Looking ahead to the new year brings speculation as to which market segment will prevail as the best investment choice. I have a couple I would like to share today. First I will start with NBG - National Bank of Greece. I think this one we see marginal increases throughout 2014 but will be a good one to hang onto for the years to come. Not a get rich quick stock, but one to keep for the long term. The Greek economy shows signs of improvement and NBG has stated some interesting tactics to reduce expenses and increase revenue. Keep an eye on this one this year. Second is XIN - Xinyuan Real Estate. They build apartment complexes in middle sized asian cities and as of right now have a good P/E ratio and a positive looking future. XIN is currently 5.49 and I wouldn't be surprized to see over 7.00 in 2014. So on a recap NBG I would buy under $6.00, and same for XIN buy under $6.00. I have a sell order at $7.50 for XIN (picked it up a little over $5.00) and am holding onto NBG for a while. Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-78778163736511710172009-09-22T17:17:00.000-07:002009-09-22T17:18:31.380-07:00Getting back into financial stocksWith the markets on the mend, fund manager David Ellison says there are great bargains to be had.<br /><br />NEW YORK (Fortune) -- Now that the housing crisis looks like it's really hit bottom, it's a good time to be a financial services investor, says David Ellison, president of FBR funds.<br /><br />"When things are good or great, you don't really make any money. What's the upside?" he says. "You don't get these opportunities very often to get through these cathartic events."<br /><br />Back in the first quarter of last year, Ellison says there were too many uncertainties in the fundamentals of the economy. But now that the economy has come through that period and enough healing has taken place, investors can get back in the market without having to worry about quite so many unknowns.<br /><br />He points to residential real estate, where prices have fallen an average of 30% from their 2006 peak. "We haven't had a nationwide decline in residential real estate in this country in almost anyone's lifetime." Prices don't need to rise back to boom-time levels -- in fact, he would rather they stay in line with inflation or GDP growth. They just have to level out, and inventories need to come down.<br /><br />0:00 /2:55Bank stocks too hot?<br />During the last boom, banks were over-lending and making risky bets to produce higher returns. Ellison believes the slump has forced them to return to traditional lending standards and practices, which bodes well for their profitability in years to come.<br /><br />He says banks are going to spend the next five years taking down risk and complexity. And people are buying homes to live in, not to flip. "The guys that can make loans today are going to be the guys that have the profit tomorrow to pay off the bad loans they made two years ago," he says.<br /><br />Ellison managed to avoid devastating losses during the meltdown. He began shifting out of stocks six or seven quarters ago, when he saw banks reporting big increases in non-performing loans. At one point he had 60% of his portfolios in cash. Currently, both funds are less than 5% in cash, he says.<br /><br />As a result of his timely moves, his FBR Small Cap Financial fund (FBRSX), which has $220.7 million in assets, is up about 1% from a year ago and about 25% from the start of the year, according to Morningstar. His FBR Large Cap Financial fund (FBRFX), with $44.7 million in assets, is down less than 1% from a year ago but up almost 40% so far this year.<br /><br />But since the second quarter of 2009 he's moved his money into financial stocks. "The overriding assumption is five years from now most of the banks will be better than they are today," he says.<br /><br />In his large cap portfolio, Ellison concentrates on the giants; according to Morningstar, Bank of America (BAC, Fortune 500) and J.P.Morgan Chase (JPM, Fortune 500) are his two largest holdings. "This is the American banking system," he says. "It's very simple."<br /><br />In his small-cap fund, Ellison divides his portfolio into thirds. One-third is companies he knows are going to make it, and another third is companies that are good but not great, perhaps trading at a 30% discount and might double or triple your money. The final third is the best of the worst. The stocks are very cheap, and if they make it, investors will do well off them.<br /><br />His top holdings in his small cap fund include Webster Financial Corp (WBS), Fifth Third Bancorp (FITB, Fortune 500), Astoria Financial Corporation (AF), and TCF Financial Corporation (TCB), according to Morningstar. <br /><br />Source: <a href="http://money.cnn.com/2009/09/22/pf/financial_stocks_investing.fortune/index.htm?postversion=2009092214">money.cnn.com</a>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-13443432537948628452009-09-15T15:08:00.001-07:002009-09-15T15:20:52.575-07:00Investing in "cheap" stocksInvesting in cheap stocks, or stocks under 1 dollar per share, is indeed risky, but sometimes it is worth the risk. A few years ago I invested in Calpine Energy the symbol at the time was CPNLQ. I bought it at around .23 and sold it around .50, I made a nice little chunk of change, but I continued to keep an eye on Calpine. It went all the way up to over 4 dollars a share, I was really kicking myself for not holding on to that one. Even though the company was going through financial troubles, the stock price continued to rise. It has been a habit of mine for a while now to look for stocks priced under a dollar, and go from there. It has payed off more times than not, you just have to do a little research on the company first. If a company is down on its luck, but has great potential for rapid success in the near future, I buy, buy, buy. I still like energy stocks, most of them are companies that have been around for a while and now how to run their business. Just because a company is down, certainly isn't a reason not to buy. Look at Sirius XM Radio and Ford, they were both way down, facing financial trouble, and now they are both on the way back up. If they reach the prices they were trading at before the downfall, I for one, will have made enough to take a nice family vacation (even after taxes).Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-38789058613528803772009-09-14T18:20:00.000-07:002009-09-14T18:23:09.682-07:00Investing in the 'new normal'There's no question that this isn't a typical recession, and money manager Ron Muhlenkamp says it's time to reset expectations.<br /><br /><br />By <a href="http://money.cnn.com/2009/09/02/pf/funds/ron_muhlenkap_interview.fortune/index.htm?postversion=2009090204">Mina Kimes</a>, writer-reporter<br />September 2, 2009: 4:33 AM ET<br /><br />NEW YORK (Fortune) -- Money manager Ron Muhlenkamp gets a lot of credit for his bold, macro-driven investing style, and he deserves it: His namesake fund has returned 9% annually over the last 15 years, 2% better than the S&P 500.<br /><br />Last year, however, his portfolio took a heavy blow: The Muhlenkamp Fund (MUHLX), which owned holdings in the insurance and mortgage sectors, lost 40% of its value, worse than the blue-chip index.<br /><br />But when the market was at its nadir, Muhlenkamp hunted for values, picking up shares of beaten-down names like IBM (IBM, Fortune 500) and Legg Mason (LM, Fortune 500). Those picks have since soared, and his fund has recouped much of its losses: It's up 25% so far this year, 18 points higher than other large-value funds, according to Morningstar.<br /><br />Despite his improved outlook, the manager, who lives on a farm in Western Pennsylvania and loves Harley Davidson motorcycles (he believes Harley's (HOG, Fortune 500) stock is an economic bellwether), says the days of go-go growth are over.<br /><br />"We fell off a cliff last fall, and things have basically flatlined," he said in a recent conversation with Fortune. "This is not a normal cyclical recession -- this time, people have reset their expectations."<br /><br />In your latest quarterly letter to shareholders, you wrote that the economy is setting a lower base for expansion. How will that affect the market?<br /><br />A lot of folks talk about "the new normal." The consumer went from spending 100% to 95%. If you drop by 5%, it takes three years just to get back to where you were. During that time, margins are going to be tight. Every industry we can find has ample capacity, and profitability is going to be less than what it was.<br /><br />For the market, fair value today is about 15-20% lower than what it was a year ago. We think there will be a 15% drop in return on equity, our favorite metric. Price to earnings ratios should be below what they were.<br /><br />Does "the new normal" offer any opportunities for growth?<br /><br />In 2001, we had a normal recession. Coming out, we owned a lot of homebuilders and discretionary stocks, but the things that lead one expansion don't lead the next. If I'm right and the consumer has really cut back this time, then you want to go where the consumer is going with his savings. So there's that extra 5% -- where does it go?<br /><br />One area where I think there's going to be huge demand is financial advice. What I haven't been able to get a handle on is -- which vendors of financial advice still have a good reputation?<br /><br />Right now, we own Bank of America (BAC, Fortune 500), which, along with Merrill Lynch, serves some 50% of the households in the U.S. If they can capitalize on that, there's a huge opportunity.<br /><br />You wrote this spring that you were puzzled by the continued decline in share prices of "great companies." Since then, many blue-chip stocks have bounced back. Is it time to look at lesser known names?<br /><br />The little stuff has come back more, and all year we've found more value in the big stuff. Size is irrelevant, though. If companies earn good money over time and don't blow it, their stocks will reflect that. Cisco (CSCO, Fortune 500) or IBM or Oracle (ORCL, Fortune 500) at 12 times earnings? That's a good bet.<br /><br />They're world class companies that sell to a world market. As China and India and Brazil grow faster than the U.S., that's a way I can participate with accounting I trust.<br /><br />Nearly a quarter of the stocks in your portfolio are in the health care sector, including managed care company UnitedHealth. Are you worried about headwinds from potential reform?<br /><br />How can you have a health care system without UnitedHealth (UNH, Fortune 500)? The best time to buy pharmaceutical or health care stocks has always been in election years, because that's when everyone beats up on the industry. Right now, any positive news about health care would be a surprise.<br /><br />In my business, you make money on the difference between perception and reality. When everyone expects the bad, that's when you get the chance to buy Pfizer (PFE, Fortune 500), which we own, for cheap.<br /><br />Is there any sector you're bearish on?<br /><br />We don't own any utilities -- the time to own them was last year. Of course, we didn't own them then (laughs). If we're any good at picking and choosing stocks, we should do better than utilities. They generate average returns, and I've never aspired to be average. <br /><br />Source: <a href="http://money.cnn.com/2009/09/02/pf/funds/ron_muhlenkap_interview.fortune/index.htm?postversion=2009090204">money.cnn.com</a>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-33213582375081177962009-09-11T14:52:00.000-07:002009-09-11T14:53:19.497-07:00Remebering September 11, 2001<a href="http://3.bp.blogspot.com/_bPBSdHUiJxU/SqrGtEwSiEI/AAAAAAAAACo/_2Nyqm9F9BI/s1600-h/800px-Wtc-2004-memorial.jpg"><img style="display:block; margin:0px auto 10px; text-align:center;cursor:pointer; cursor:hand;width: 320px; height: 240px;" src="http://3.bp.blogspot.com/_bPBSdHUiJxU/SqrGtEwSiEI/AAAAAAAAACo/_2Nyqm9F9BI/s320/800px-Wtc-2004-memorial.jpg" border="0" alt=""id="BLOGGER_PHOTO_ID_5380331182520174658" /></a>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-80983422411709798142009-09-11T14:32:00.000-07:002009-09-11T14:36:29.946-07:00Retail Stock Surprise: Sears Tops PollNEW YORK (<a href="http://www.thestreet.com/story/10597647/1/retail-stock-surprise-sears-tops-poll.html">TheStreet</a>) -- Department stores, on the whole, rallied this week, but surprisingly Sears(SHLD Quote) ranked as the winner in sector among TheStreet readers. <br />Sears was favored as the hottest stock with 31.5% of the total vote, beating out Kohl's(KSS Quote), which has -- unlike Sears -- been a consistent winner in the sector. <br />Jim Cramer said in his State of the Market report on Wednesday that Sears is garnering too much attention. <br />Still, investors sent shares of the company up 3% this week to close at $64.18. <br /><br /><br />Kohl's came in a close second with 27.5% of the vote. Earlier in the month, the company reported a 0.2% jump in August same-store sales, surpassing analysts' expectations of a 1.7% decline. Kohl's has won over shoppers with its private-label and exclusive merchandise at wallet-friendly prices. <br />Shares of the company grew 2.5% to close at $55.18 on Friday. <br />J.C. Penney(JCP Quote) came in third in the survey at 17.8%. <br />On Friday, that company launched "she said," a contemporary career sportswear brand catering to the female professional. <br />Experts predicted the company would perform better in August from the back-to-school sales increase, but it fell short of expectations, with same-store sales sinking 7.9%, lower than the 6.7% drop forecast. <br /><br />Dillards(DDS Quote) placed fourth in the poll with 13.8%, while shares of the company soared 11% to close at $12.84 on Friday.<br /><br />Macy's(M Quote) ranked last with only 9.4% of the total vote. The department store has been struggling to rein in shoppers, and in the second quarter it was dragged down by its furniture, mattress and handbag segments. <br />Same-store sales in August tanked by 8.1%, more than the 7.4% decline expected by analysts. Regardless, shares of the company closed off the week up 6% to $16.09. <br />-- Reported by Jeanine Poggi in New York <br />Follow <a href="http://www.thestreet.com/story/10597647/1/retail-stock-surprise-sears-tops-poll.html">TheStreet.com</a> on Twitter and become a fan on Facebook. <br /><br />Source: <a href="http://www.thestreet.com/story/10597647/1/retail-stock-surprise-sears-tops-poll.html">thestreet.com</a>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-46571035023904432452009-09-09T15:29:00.001-07:002009-09-09T15:29:49.268-07:00Industrials, financials pull stock market higherBy TIM PARADIS (AP) <br /><br />NEW YORK — The stock market extended its gains to a fourth day as the Federal Reserve said the economy was stabilizing.<br /><br />The Standard & Poor's 500 index, which is the basis for many mutual funds, reached an 11-month high as industrial stocks rallied. The Dow Jones industrial average rose 50 points to its second-highest close of the year.<br /><br />The market stumbled briefly following the release of the Fed's report on regional economies, which also found that consumer spending would rise but only because of car purchases linked to the government's brief Cash for Clunkers program. The report also said the job market remains weak.<br /><br />The prolonged slump in consumer spending has been one of the most serious points of worry for economists, and the Fed's warning about it deflated some of the market's optimism. About 70 percent of the U.S. economy depends on spending by consumers.<br /><br />Matt Lloyd, chief investment strategist at Advisors Asset Management, said investors were jittery following the Fed's report because many traders are fearful of a correction following a 50 percent surge in stocks over the past six months.<br /><br />"To me there is no conviction" behind the market's recent gains, Lloyd said.<br /><br />The Dow rose 49.88, or 0.5 percent, to 9,547.22. The index has added 267 points, or 2.9 percent, in four days. It was the Dow's second-highest close of the year, just below its Aug. 27 close.<br /><br />The broader Standard & Poor's 500 index gained 7.98, or 0.8 percent, to 1,033.37, while the Nasdaq composite rose 22.62, or 1.1 percent, to 2,060.39. It was the highest close for the S&P 500 index and the Nasdaq since October.<br /><br />The Russell 2000 index of smaller companies rose 10.02, or 1.7 percent, to 586.40.<br /><br />Advancing stocks outpaced those that fell by about 5-to-2 on the New York Stock Exchange, where volume came to 1.2 billion shares compared with 1.3 billion Tuesday.<br /><br />Jeff Kleintop, chief market strategist at LPL Financial Services, said a break in the rally could be good for the market to keep stocks from racing too high, too quickly.<br /><br />"I think we're maybe due for a little bit of consolidation," he said.<br /><br />Kleintop also contends that economic readings are becoming a less powerful force on the market as more investors begin to expect an improvement in the economy.<br /><br />"Economic data has lost a lot of its power to really move the market around. The consensus has now become we're in a recovery."<br /><br />Light, sweet crude rose 20 cents to settle at $71.31 per barrel on the New York Mercantile Exchange. Gold fell but still hovered near $1,000 after crossing that mark Tuesday for the first time since February.<br /><br />Industrial shares were the biggest gainers, as investors bet that higher commodity prices will translate to increased profits if the economy strengthens. The weaker dollar also makes the goods of U.S. exporters cheaper outside the U.S.<br /><br />Caterpillar Inc. was among the strongest advancers of the 30 stocks that make up the Dow industrials. Shares of the maker of construction and mining equipment rose $1.44, or 3.1 percent, to $48.41.<br /><br />Boeing Co. rose $1.03, or 2.1 percent, to $50.53, while General Electric Co. rose 37 cents, or 2.6 percent, to $14.87.<br /><br />Bond prices mostly rose. The yield on the 10-year Treasury note was flat at 3.48 percent.<br /><br />Haag Sherman, chief investment officer at Salient Partners in Houston, said investors' demand for stronger returns is weighing on the dollar, though he notes that the 10-year Treasury note has held its ground as some investors remain skeptical about a rebound in the economy.<br /><br />"The 10-year really hasn't been punished as much lately. I think there is a tug-of-war between the equity and the bond market."<br /><br />Overseas, Japan's Nikkei stock average fell 0.8 percent. Britain's FTSE 100 rose 1.2 percent, Germany's DAX index rose 1.7 percent, and France's CAC-40 advanced 1.3 percent.<br /><br />Copyright © 2009 The Associated Press. All rights reserved. <br /><br />Source: <a href="http://www.google.com/hostednews/ap/article/ALeqM5jmT59dgLTTziX4p9X9MRBRpWZGdQD9AK1PHO0">Associated Press</a>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-37404839400032165052009-09-08T19:22:00.000-07:002009-09-08T19:24:53.243-07:00U.S. stocks rise as investors speculate about gold, crudeEquities analysts see stronger economy and inflation ahead<br /><br />By Kate Gibson, MarketWatch <br />NEW YORK (MarketWatch) -- As the rising price of commodities helped bolster the U.S. stock market Tuesday, investors found a mixed message in surging gold and crude. <br /><br />"The stock market is fine, as long as the economy and earnings hold up. The challenge will be rising inflation and interest rates," said Hugh Johnson, chairman of Johnson Illington Advisors. <br /><br />"Everything we saw last week pointed to a stronger economy with higher inflation," said Johnson of recent economic data, including a survey by the Institute for Supply Management released last Thursday, which found prices paid by purchasing managers climbed to 63.1% in August from 41.3% the month before.<br /><br />On Tuesday, energy and materials companies led broad market gains as the major U.S. indexes extended their advance to a third session. <br /><br />The Dow Jones Industrial Average /quotes/comstock/10w!i:dji/delayed (INDU 9,497, +56.15, +0.60%) gained 56.07 points, or 0.6%, to end at 9,497.34, while the S&P 500 Index /quotes/comstock/21z!i1:in\x (SPX 1,025, +8.99, +0.88%) added 8.99 points, or 0.9%, to 1,025.39 and the Nasdaq Composite /quotes/comstock/10y!i:comp (COMP 2,038, +18.99, +0.94%) rose 18.99 points, or 0.9%, to 2,037.77. More data: Market Overview. <br /><br />While gold bugs point to inflation as being behind the precious metal's climb, gold ETF money flows suggest otherwise, said Jack Ablin, chief investment officer at Harris Private Bank. <br /><br />"The ratio of bullish ETFs to bearish ETFs in gold has explained a better part of the commodity's movement since their introduction in 2007. Inflation-protected Treasury securities, or TIPs, offer a better indication of inflation expectations. The five-year TIP security currently implies a meager 1.4% annual CPI for the next five years," wrote Ablin in a Tuesday note. "Given the disparity, I'm inclined to side with the Treasury market." See Bond Report. <br /><br />Hopes for an economic recovery are supportive of both equities and the price of crude, which advanced $3.08, or 4.5%, to $71.10 a barrel. Read Futures Movers. <br /><br />Should oil shoot higher for some reason other than the economy, the rise is no longer bullish for equities, said David Kelly, chief market strategist at J.P. Morgan Funds. <br /><br />In the third quarter of 2008, 3.5% of GDP was devoted solely to buying foreign oil -- "a significant tax on the U.S. economy," Kelly said. <br /><br />Conversely, speculation about higher inflation on the horizon fueled buying in gold as well as in shares of basic-materials companies but brought a bearish tint to the broad stock market. <br /><br />On the New York Mercantile Exchange, gold futures on Tuesday climbed to an 18-month high of $1,006.90 an ounce but ended beneath the quadruple-digit threshold at $997.90. See Metals Stocks. <br /><br />Dan Greenhaus, chief economic strategist at Miller Tabak & Co., called gold's spike above $1,000 an ounce and crude's surge above $71 a barrel "symptoms" of the greenback's decline to its lowest level since the fall of 2008. <br /><br />"As the dollar moves lower and expectations continue to look for even further weakness, upward pressure on various commodities including gold and oil will be the order of the day," said Greenhaus. <br /><br />Trading in both crude and gold futures is denominated in U.S. dollars. <br /><br />"Gold is a completely speculative play. It's only worth what someone else is willing to pay for it," said Kelly. <br /><br />"Oil is being used more and more as a speculative football, as there is no supply imbalance now [to drive prices up] -- part of it is people are getting in as an investment," he said. <br />Kate Gibson is a reporter for MarketWatch, based in New York.<br /><br />Source: <a href="http://www.marketwatch.com/story/us-stocks-rise-along-with-commodities-2009-09-08">Marketwatch</a>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-88831357056378334392009-09-07T00:46:00.000-07:002009-09-07T00:51:48.588-07:00I still like SIRII still like sirius xm radio (SIRI). I think it will top the dollar mark, and avoid delisting of Nasdeq. Once it tops one dollar per share and they start having positive numbers, I think this one will really take off. With all of the new car contracts that SIRI has acquired and the sales of the units in stores the revenues will continue to increase. You can even listen to sirius xm on satallite TV, it just seems to be everywhere. And being the one main provider, they have the market cornered.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-57189470197342324502009-09-06T23:36:00.001-07:002009-09-06T23:43:33.661-07:00I wouldn't buy gold right nowI think gold has seen most of the good times pass already. It has been continually climbing, and my personal opinion is that it has hit the top end. With stocks in an excellent position to rise dramatically, I think investors in gold will look to a more profitable option (like mid and large cap stocks). I believe that fear in the volitility of stocks has persuaded many investors to look at gold, now that the stock market is on the rise, the demand for gold has a good chance to decline. It would still make a good choice for diversification because you never know for sure what is going to happen in the market, but I'm not buying at this point.Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-80181683854475025222009-09-04T15:58:00.000-07:002009-09-04T16:01:14.051-07:00Mortgage giants struggle a year after takeoverWASHINGTON (AP) -- A year after the near-collapse of Fannie Mae and Freddie Mac, the mortgage giants remain dependent on the government for survival and there is no end in sight.<br /><br /><br />The companies, created by the government to ensure the availability of home loans, have tapped about $96 billion in government aid since they were seized a year ago this weekend. Without that money, the firms could have gone broke, leaving millions of people unable to get a mortgage.<br /><br />Many questions remain about Fannie and Freddie's future, but several things are clear: The companies are unlikely to return to their former power and influence, the bailout is sure to cost taxpayers even more money and the government will have a big role in the U.S. mortgage market for years to come.<br /><br />Fannie Mae was created in 1938 in the aftermath of the Great Depression. It was privatized 30 years later to limit budget deficits during the Vietnam War. In 1970, the government formed its sibling and competitor Freddie Mac.<br /><br />The companies boomed over the past decade, buying mortgages from lenders, pooling them into bonds and selling them to investors. But critics called them unnecessary, arguing that Wall Street could support the mortgage market itself.<br /><br />That argument has faded in the wreckage of the failed loans that led to the housing bust. Investors have fled any mortgage investment that doesn't have the government standing behind it.<br /><br />"No longer is anyone arguing that the private sector can handle this on its own," said Jaret Seiberg, an analyst at Washington Research Group.<br /><br />The government stepped in to take control of the two companies on the weekend of Sept. 6, after they were unable to raise money to cover soaring losses and their stock prices plunged.<br /><br />A year later, the government controls nearly 80 percent of each company, and their problems are growing as defaults and foreclosures continue to skyrocket.<br /><br />The percentage of homeowners who have missed at least three months of payments is normally under 1 percent for both companies. Now it's nearly 4 percent for Fannie and 3 percent for Freddie.<br /><br />Fannie had nearly $171 billion in troubled loans as of June and had set aside $55 billion to cover those losses, while Freddie had nearly $78 billion in troubled loans and reserves of only $25 billion.<br /><br />"It's much worse than anybody thought," said Paul Miller, an analyst with FBR Capital Markets.<br /><br />It could be another year before the final taxpayer tab for Fannie and Freddie is known, and that outcome will depend on when delinquencies and foreclosures finally crest.<br /><br />Barclays Capital predicts the companies will need anywhere from $160 billion to $200 billion out of a potential $400 billion lifeline, which the Obama administration expanded from the original $200 billion set last fall. Most analysts don't expect the money to be returned anytime soon, if at all.<br /><br />"What will ultimately end up happening," said Barclays analyst Ajay Rajadhyaksha, "is that the U.S. taxpayer swallows the bill."<br /><br />Despite federal control, Fannie and Freddie have recently surged on Wall Street. The companies said Friday that they now comply with New York Stock Exchange requirement for an average closing price of $1 a share or more. But most analysts still say the companies' stocks will be worthless in the long term.<br /><br />The Obama administration doesn't expect to announce its plans for the two companies until early next year, but powerful interest groups aren't waiting until then. The Mortgage Bankers Association on Wednesday offered a detailed plan to replace Fannie and Freddie with several federally-regulated private companies.<br /><br />That proposal still retained a big government role, giving those companies the ability to issue mortgage bonds formally guaranteed by the federal government.<br /><br />In the meantime, both Fannie and Freddie have been drafted to implement the Obama administration's effort to attack the foreclosure crisis. Freddie Mac now has about 600 workers either modifying loans or monitoring compliance with the program's rules. Fannie Mae said it has added hundreds of employees to work on foreclosure prevention efforts.<br /><br />The early results have been disappointing. For example, while Fannie or Freddie refinanced 2.9 million loans from January through July, only about 60,000 were taking advantage of an Obama administration plan to help "underwater" borrowers who owe more than their homes are worth.<br /><br />At the same time, nearly 70 percent of U.S. mortgages made in the first half of this year went through Fannie or Freddie, up from 62 percent last year, according to Inside Mortgage Finance, a trade publication. That's a big change from three years ago, when the risky lending market was still alive and Fannie and Freddie's share was down to 33 percent.<br /><br />"We've been the mortgage market," said John Koskinen, Freddie Mac's chairman. "Without that financing availability, people would not have been able to get a mortgage."<br /><br />Fannie and Freddie don't directly make loans, but they exert enormous influence over the industry by issuing detailed standards for the loans they will purchase. Lenders must feed their borrowers into Fannie and Freddie's computer systems, which evaluate borrowers based on their credit scores and the size of their down payment.<br /><br />Both companies, facing huge losses, have kept those standards tight, frustrating many. Eric Delgado, a mortgage broker in Rockville, Maryland, says there's zero flexibility with either company. Either borrowers qualify or they don't. No arguing. No excuses.<br /><br />But some in the industry say the restrictions are long overdue after several years of lending excesses.<br /><br />"You needed to bring some reality to the market," said Michael Moskowitz, chief executive of Equity Now, a New York-based mortgage lender, which does about 80 percent of its business with Fannie and Freddie.<br /><br />Fannie Mae CEO Michael Williams declined an interview request, but said in an e-mailed statement that "it is not enough to help a borrower own a home. We must also help ensure that they will be able to stay in the home over the long term."<br /><br />By Alan Zibel, AP Real Estate Writer <br />On Friday September 4, 2009, 6:06 pm EDT<br /><br />Source: <a href="http://finance.yahoo.com/news/Mortgage-giants-struggle-a-apf-1977649529.html?x=0&sec=topStories&pos=2&asset=&ccode=">Yahoo finance</a>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-2138698787609473042009-09-04T15:09:00.000-07:002009-09-04T15:11:04.499-07:00Bonds slip after jobs dataGovernment debt prices ease after employers cut 216,000 jobs last month, fewer than the 276,000 lost in July.<br /><br />NEW YORK (Reuters) -- Treasurys slipped Friday after data showed fewer-than-expected job losses in August, dimming the allure of safe-haven government bonds.<br /><br />U.S. employers cut 216,000 jobs last month, fewer than the 276,000 lost in July or the 225,000 expected by economists. The data gave some cheer to investors betting that the economy is on the road to recovery from the worst recession in decades.<br /><br />Average hourly earnings also jumped, but the encouragement was tempered by the fact that the unemployment rate rose much more than expected to its highest level in 26 years, which initially caused bonds to cut their losses.<br /><br />"The Treasury market may have rallied initially on this payrolls report because the unemployment rate was 0.2% higher than expected, -- a pretty big miss there," said Suvrat Prakash, U.S. interest rate strategist with BNP Paribas in New York.<br /><br />But he noted that the consensus was for the unemployment rate to rise anyway, adding: "Maybe what we should take out of this is the fact that wage earnings were up and the actual level of payrolls itself was better than expected."<br /><br />The 30-year bond was last down 23/32 in price, yielding 4.20%. It was briefly off more than one point in price.<br /><br />The benchmark 10-year note fell 8/32, yielding 3.38% versus Thursday's close of 3.35%.<br /><br />U.S. stocks posted modest gains, making riskier assets appear more attractive compared with more conservative investments such as government bonds.<br /><br />Another near-term negative for Treasurys was next week's bond auction slate, which will bring $70 billion worth of debt to the market.<br /><br />"The market has to take down the supply," said Prakash. "Overall demand, while it has been healthy, it's healthy at the right price, so you tend to see yields drift higher into auctions."<br /><br />New life?<br />Ultimately, though, the mixed nature of the jobs report -- the biggest economic release of the month -- may prove supportive for bonds, which were still on track for their fourth week of gains despite Friday's mild retreat.<br /><br />Treasurys have not had a winning streak like this since late last year, when credit markets melted down in the wake of the Lehman Brothers collapse.<br /><br />The situation now appears less dire, but bonds are rallying on the Federal Reserve's assurances that it will not begin raising interest rates until the economy is on firmer footing.<br /><br />High unemployment is likely to encourage bond investors who do not believe the Fed will raise interest rates any time soon since inflation is unlikely to take off when consumers fear for their jobs and seek economic security.<br /><br />"Despite the recent improving trend in overall economic data, the high unemployment rate is still not going to sit well with most investors," said Lawrence Glazer, managing partner of Mayflower Advisors in Boston.<br /><br />"These data may breathe new life into Treasurys." <br /><br />Source: <a href="http://money.cnn.com/2009/09/04/markets/bondcenter/bonds.reut/index.htm?postversion=2009090412">money.cnn.com</a>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-75182736241445023612009-09-03T17:22:00.000-07:002009-09-03T17:24:47.683-07:00Betting on a smokey recovery<em>Thomas Lee of J.P. Morgan says a U.S. economic rebound could get a little dirty for investors who want to make money.<br /></em><br /><br />NEW YORK (Fortune) -- When looking for stocks that will rise out of the current recession, Thomas Lee, J.P. Morgan's chief U.S. equities strategist and one of Wall Street's most bullish prognosticators, advises clients to buy for a "smoke stack recovery."<br /><br />Lee, who in January predicted the S&P 500 index (SPX) to finish at 1,100 by year-end, says the combination of quick gross domestic product recovery and low industrial growth through the recession should lead to bigger gains in sectors like industrials, material makers and energy firms.<br /><br />"This is going to be a very smoke stackey recovery," says Lee. He says investors should buy "companies that feed industrial production."<br /><br />Lee's call is rooted in J.P. Morgan's bullish expectations of a strong U.S. and global recovery. The bank's economic research team expects U.S. GDP will recover to 2007 levels by the end of 2010. "[I]t now looks likely that the coming four quarters will see GDP gains that rival the strongest global performance of the past two decades," its worldwide research team recently wrote.<br /><br />Companies that delayed new projects and countries that put off structural upgrades during the recession, Lee contends, will put money toward industrial production to keep up with increased spending and GDP growth.<br /><br />Businesses are also better positioned to spend. As Lee points out, S&P 500 companies hoarded cash and cut expenses in the downturn. Nine out of 10 sectors in the index have lower expenses levels than they did in 2007. (The only exception is health care.)<br /><br />And corporate borrowing costs have dramatically fallen. "Today, high-grade issuers are borrowing at levels even lower than they could in 2005," Lee says. "There are a lot of things that have positioned companies now in 2010 for much better earnings if the economy starts to recover."<br /><br />How can investors buy into an industrial recovery? First, Lee recommends small and midcap stocks which rise fastest during a recovery. The Russell 2,000 index of smallcaps for example, has returned 63% since its March 9th low, while the Dow Jones Industrial Average has gained 42% since then.<br /><br />J.P. Morgan Securities recently released its small and midcap "Money List" -- a group of recommended stocks based on risk/reward, industries, and balance sheets. Lee thinks the following shares should benefit from a smoke stack recovery:<br /><br />Bway Holding Company (BWY)<br /><br />The $1-billion company makes containers: metal paint cans, aerosol cans and plastic pails. Lee likes the stock because it trades at one of the group's cheapest price/earnings to growth ratios. It was 2.39 in the June quarter. Bway also raised its 2009 earnings expectations by 4% to $124 million in August as costs cuts worked amid declining sales.<br /><br />Century Aluminum (CENX)<br /><br />The $2-billion aluminum maker supplies four main customers for nearly 75% of its sales: Rio Tinto Alcan (the aluminum unit of Rio Tinto), Southwire, BHP Billiton, and Glencore International. The value of its stock has risen nine-fold since March. But Lee still sees opportunity as a strong U.S. recovery will hasten the need for materials.<br /><br />Terex (TEX, Fortune 500)<br /><br />Terex cranes and construction equipment can been seen at almost any construction site. The $9.9 billion manufacturer makes cement mixing trucks and surface mining equipment and is the world's No. 3 construction equipment maker. Terex said this summer that sales cold drop 40% to 45% this year amid the recession, but J.P. Morgan expects the stock to bounce back.<br /><br />Lee cautions that every recovery slowly works its way through different economic sectors. Even so, he recommends retail investors buy strong operators before Wall Street analysts begin to turn bullish and upgrade their stocks. He notes that the number of "buy" ratings on S&P 500 companies are at their lowest level since 2003. "For a retail investor, that's important, Lee says. "They might anticipate [a recovery]."<br /><br />First Published: September 3, 2009: 1:02 PM ET<br /><br />Source: <a href="http://money.cnn.com/2009/09/03/pf/thomas_lee_morgan.fortune/index.htm?postversion=2009090313">money.cnn.com</a>Unknownnoreply@blogger.com0tag:blogger.com,1999:blog-4112364207357603879.post-72791380697316981832009-09-02T17:55:00.000-07:002009-09-02T17:58:34.356-07:00'Fast Money' Recap: Gold FeverNEW YORK (TheStreet) -- The markets remained in the red Wednesday in a trading session that was straining for direction.<br /><br />The Dow Jones Industrial Average dropped 29.93, or 0.32%, to 9280.67, and the S&P 500 fell 3.29, or 0.33%, to 994.75. The Nasdaq slipped 1.82, or 0.09%, to 1967.07. <br /><br />As it did with Tuesday's favorable manufacturing report from the Institute for Supply Management, the market's reaction was muted to the Fed's Open Market Committee's comments indicating an economy on the mend. <br />Joe Terranova said on CNBC's "Fast Money" TV show that there were a lot of trading opportunities in the market today, especially on the resource side where several stocks had intra-day reversals . For example, he noted Potash(POT Quote) and Freeport McMoRan (FCX Quote). <br /><br />For a breakout of some stocks from a recent "Fast Money" TV show, check out Dan Fitzpatrick's "3 Stocks I Saw on TV." <br /><br />Guy Adami said there was nothing in today's "benign" tape that would change his opinion that the market will continue to head down. <br />Adami said that although he thinks highly of Goldman Sachs(GS Quote), it, too, wouldn't be spared if the market sinks. <br />Melissa Lee, the moderator of the show, shifted the discussion to gold, which broke out today and is only $20 below the $1,000 level. "Everybody but myself has been bullish on it. Do I look as stupid as Paris Hilton taking the SATs? Sorry Paris if you're watching," said Adami. <br />Adami said he was concerned with gold's "exaggerated move" today and advised investors to "remember the market we're in." <br /><br />Source: <a href="http://www.thestreet.com/story/10593834/1/fast-money-recap-gold-fever.html">thestreet.com</a>Unknownnoreply@blogger.com0