Featured Archives

Longs and Shorts

First, NO, I do NOT short, and never will. My short here, is a hold, if you are already invested. And, jumping straight to the chase, my HOLD is Harley-Davidson (HOG). Great company, good management, great stock. Just WRONG time to buy. Even in the midst of EVERY economic indicator that says to. OIL, is beginning to regain it's ground in pump price. Ordinarily, it would be good for a HOG too, but not this time. continued... continue

by Don Montcrief  |  06/12/09  |  Stocks: HOG,

GM Goes Bust

What used to be the largest corporation in the world is now bankrupt. This isn't exactly a surprise. Here's what I wrote in 2006: Whither GM? In 1979, the British economy was in free fall. Inflation was spiraling out of control. The unions were demanding commensurate pay increases, and when they didn't get them, they struck. The country that had stood up to the Luftwaffe was failing apart. The garbage men went on strike and soon piles of "rubbish" dotted... continue

by Eddy Elfenbein  |  06/01/09  |  Stocks: GM,

Odds Favor The Sideways Pattern For Weeks Now Will Give Way To The Downside

I know it seems like we haven't gone anywhere because we're still in the slow-moving expanding triangle pattern, which can be almost as frustrating as whip-saws. When we get into topping patterns like this, the movement is slower because they're the opposite of bottoming patterns, which are "V" shaped. As I tell you in today's video update, which should begin playing automatically at the bottom of the page, they take time and move in a "rounded" way -- it's not... continue

by John Lansing  |  04/30/09  |  Stocks: SPY,

Monkey-Fly

Think outside the box... Most retail customers buy butterfly's dirt cheap hand over fist trying to hit it big on these low cost trades. The real question most should inquire about is why are butterfly's so inexpensive?? They have very low probabilities of success!! The standard butterfly is simply "taking a shot" and should be utilized and viewed this way. So what now for the butterfly?? Do we abandon our long shot altogether?? Not likely. The butterfly can be used... continue

by thinkorswim  |  04/17/09  |  Stocks: SPY,

10 Stocks with Awful Fundamentals

The key to my investing philosophy is to focus on stocks with outstanding fundamentals. This means key variables like strong sales and earnings growth and a high return-on-equity. With earnings season fast approaching, you want to make sure that you don't own any stocks with lousy fundamentals. In my latest issue of my free weekly eletter, What's Working on Wall Street Now, I listed ten stocks that have very poor fundamentals. continued... continue

by Louis Navellier  |  04/07/09

AIG Has Nothing on These Guys!

I think it's time to bring back public flogging. Even better, let's pay down our trillion dollar deficit by putting people in a public stockade and selling the angry mob tomatoes to throw at them! Daria tells me my ideas might be a wee bit over the top, but she agrees that a little public shame and humiliation are in order for those who exhibit obnoxious, often reprehensible and sometimes flat out illegal behavior. Don't you agree? After all, we're... continue

by The Dolans  |  04/02/09

The Banks, Again

I just finished reading Geithner's plan and the new mark to market modifications being proposed by FASB. Some thoughts on the new rules in light of the Geithner plan. The larger issue is where do the new rules fit with the Geithner plan and the stress tests. Before I read these documents, I assumed Treasury would queer the stress tests and make the banks look better than they are. Now I am not so sure -- the one thing all... continue

by Michael Shulman  |  03/24/09  |  Stocks: BAC, C,

Key Moving Average Test Monday

It will be interesting to watch a key technical on multiple bank stocks for Monday. Morgan Stanley and JP Morgan both closed Friday on, or very near, their 50 day moving average. The break above the 50 MA has been widely cited on CNBC, as well as the web as a sign that the financial stocks were going to rally. Monday will prove the first key technical test, to see if they bounce off or break down. Given trends in... continue

by Matthew Tansey  |  03/23/09  |  Stocks: JPM, MS, XLF,

Why Do People Make Market Forecasts?

Joe Wiesenthal criticized the idea of Nouriel Roubini making stock market forecasts. Felix Salmon jumped to his old boss' defense by saying that forecasts are indeed worthless, but the reasoning behind the forecasts can be very interesting. Then why did Roubini make a forecast in the first place? His audience just expected it? Hmmm. I think I have an answer and it's not a complicated one. The dirty secret is that stock market forecasts are fun. continued... continue

by Eddy Elfenbein  |  03/19/09

More Mega-Mergers in Big Pharma

Merck (MRK) announced that it's buying Schering-Plough (SGP) for $41 billion. This was only the latest big buyout in the world of major pharmaceutical companies, and I expect more to come. Once Pfizer (PFE) made its move for Wyeth (WYE), Merck simply had to respond. continued... continue

by Louis Navellier  |  03/16/09  |  Stocks: ABT, AMGN, BMY, DNA, MRK, PFE, SGP, WYE,

Vega , No not the Chevy Vega!

The least talked-about Greek is "Vega." But with volatility rampant, Vega holds the key! Simply said, Vega is an estimate of how much the theoretical value of an option changes price when implied volatility changes by +/-1%. Higher implied volatility would mean higher option prices. That is acceptable because with higher volatility comes greater price swings in the stock price. Positive Vega means that the value of an option position increases when implied volatility increases, and decreases when implied volatility... continue

by thinkorswim  |  03/06/09  |  Stocks: USO,

Obama's Housing Rescue Plan--Will it Save Foreclosures?

One of the most popular questions in our inbox right now is, "Will President Obama's new housing plan cure what ills the housing market?" You know you can always count on us to give it to you straight, so here it goes! One of the major goals for the plan is that it will help stop this tsunami of foreclosures. That's a goal we completely agree with. Until we stem foreclosures and stabilize the housing market, the economy as a... continue

by The Dolans  |  02/27/09

Stock Market New 52 Week Lows DOW Theory Confirmed

The Dow theory has been around for almost 100 years, yet even in today's volatile and technology-driven markets, the basic components of Dow theory still remain valid. Developed by Charles Dow, refined by William Hamilton and articulated by Robert Rhea, the Dow theory addresses not only technical analysis and price action, but also market philosophy. Many of the ideas and comments put forth by Dow and Hamilton became axioms of Wall Street. While there are those who may think that... continue

by John Lansing  |  02/23/09

Refiners are Defying Gravity on Wider Margins

As I've mentioned before, a number of my screens over the last several weeks seems to have been dominated by healthcare and refining names. Many seem to have wondered why refiners? Easiest way to answer- this chart from Bespoke Investment Group. Basically- margins are expanding quite rapidly which would mean that VLO, TSO, SUN and FTO are more or less printing money right now. Credit default swaps on VLO declined to only 363 BPs. However, SUN's CDS spreads have actually... continue

by Vad Yazvinski  |  02/18/09  |  Stocks: FTO, SUN, TSO, VLO,

Alternative Energy Trends

Even as low oil prices and a severe recession have taken their toll on alternative energy demand, a green-oriented presidential administration has brightened the hopes for renewed growth in the sector - particularly for solar and wind power. These are some of the key findings from ChangeWave's latest Alternative Energy Industry survey, conducted December 29, 2008 through January 5, 2009. A total of 210 respondents working in the industry participated. continued... continue

by Paul Carton  |  02/12/09  |  Stocks: FSLR, GE, LDK, SI, SPWRA, STP, VO, VWS.CO, ZOLT,

Illumina Soars

One of my favorite Emerging Growth stocks, Illumina (ILMN) is surging higher in today's trading. The company is involved in genetic testing and its business has been red-hot lately (here's a great profile of Illumina from Wall Strip). Illumina reported fourth-quarter earnings of 22 cents a share and sales jumped 43% to $160.9 million. That was far higher than Wall Street's consensus which was looking for earnings of 17 cents a share and sales of $154.6 million. continued... continue

by Louis Navellier  |  02/09/09  |  Stocks: ILMN,

Sysco & AFLAC

We had two more earnings reports yesterday. Sysco (SYY) reported Q2 EPS of 40 cents which was down 10% from last year but still two cents above Wall Street. The company's COO said: "Though not in line with our historical performance, our results for the quarter were solid given the difficult economic conditions," Revenue dropped slightly to $9.1 billion. In November, the company raised its quarterly dividend from 22 cents a share to 24 cents a share, which translates to... continue

by Eddy Elfenbein  |  02/03/09  |  Stocks: AFL, SYY,

(Con) Tango, Anyone??

I have noticed that a growing number of people outside the world of Commodity Trading are gaining a familiarity with the terms used to describe the prices of Commodities Futures. I hear the term Contango all over the media now and I thought it was reserved just for us trading geeks. Contango refers to a condition where the futures are pricing that particular commodity or instrument at a higher price as time goes on. In many commodities, there are futures... continue

by thinkorswim  |  01/29/09  |  Stocks: USO,

Be very mindful of government's newly minted "eminent domain" powers!

If you were one of the many of us who thought that government's "eminent domain" powers only applied to real property - I have some bad news to report- as it turns out, our government can now condemn your intangible property as well, including all of your rights as a shareholder, including "fair disclosure", "equitable" compensation etc! Heh? What are you talking about, one might ask? continued... continue

by Vad Yazvinski  |  01/22/09  |  Stocks: BAC, JPM, MER, WFC,

Consumers Showed Little Appetite for Restaurants Last Month

It's been a rough ride lately for the U.S. economy, and nowhere has this been more evident than at your favorite restaurant. According to ChangeWave's December consumer survey, it looks like more belt tightening went on last month when it comes to dining out. The survey of 1,308 consumers focused on dining habits and found a further weakening in restaurant spending. More than half of respondents (51%) said they'll be spending less money at restaurants going forward - an all-time... continue

by Paul Carton  |  01/16/09  |  Stocks: CPKI, DRI, MCD, PFCB,

Investing Rules, to NEVER be forgotten

There are two things to remember whenever considering an investment. It will make money quickly, or it will make money reliably. The converse is it will lose money quickly, or it will hold value. The market offers no guarantees, either way. But, you can't have it BOTH ways. Oh sure, there is some middle ground, where you get a dividend, and a reasonable (but no bragging rights) stock price appreciation. Hey, that is not a bad scenario, in a NORMAL... continue

by Don Montcrief  |  01/08/09  |  Stocks: AXAS, DRYS, GNK, TBSI,

The Cash on the Sidelines Story

The media has finally discovered the big story that I've been talking about for several weeks--the huge amount of cash sitting on the sidelines: There's more cash available to buy shares than at any time in almost two decades, a sign to some of the most successful investors that equities will rebound after the worst year for U.S. stocks since the Great Depression. continued... continue

by Louis Navellier  |  01/05/09

The Option Holiday Recipe

'Tis the season to increase the beltline with traditional holiday recipes! You all know what I'm talking about. This is the time of year that you pull yourself up to the table and eat that top-secret family recipe that you crave the other 11 months out of the year. So while you're whetting your appetite at the table, I've got another recipe that will whet your trading appetite. The recipe is called the Option Holiday Recipe. Here are the ingredients:... continue

by thinkorswim  |  12/22/08

Ultra Short ETFs as new WMDs of Wall Street

An interesting article in WSJ about the impact of Ultra Short ETFs on all the wild swings we have seen recently during the afternoon trading... The final hour of trading has become significantly more active. In November, an average 26.2% of trading volume in the stocks in the Standard & Poor's 500-stock index took place in the final hour and 17.1% in the last 30 minutes, according to data from Credit Suisse. That's a much higher share than before: In... continue

by Vad Yazvinski  |  12/17/08

Let the Vix Pick Your Trade!

Goodbye VIX 25, 35, and even 45. We might not see those levels for a long time. We could be looking at a VIX trading range bound from 53-80 for at least a couple of months, or until the economy starts to recover again. So how do you trade the market with the VIX as your guide? First, think about products to trade. What products have a correlation with the VIX? Any index ETF will suffice. I like to trade... continue

by thinkorswim  |  12/15/08  |  Stocks: DIA, IWM, SPY,

Grim Snapshot - The U.S. Economy in Rapidly Accelerating Freefall

Most everyone knows it's a jungle out there for the U.S. economy, but how does this recession measure up to the last one we lived through in 2001? According to ChangeWave's latest corporate survey - conducted November 20th through December 1st - the U.S. economy is caught in the clutches of a recession far deeper and more painful than anything seen back in 2001. continued... continue

by Paul Carton  |  12/08/08

Why The Dollar Is Getting Stronger

Despite all the recent troubles in our economy, the dollar is actually getting strong. Stanley Reed explains why: First, there's the fear factor. During tough economic times, investors often flee foreign currencies and other risky assets for safe havens like the U.S. dollar. The demand drives up the price relative to other currencies. In four of the past five recessions since the 1970s, the greenback finished the downturn higher than where it started. continued... continue

by Louis Navellier  |  12/02/08

Time to revisit Harley Davidson

Below is a reprint of a blog on Harley I wrote in July. I hate to see rehashed articles as much as you do but give this one a look-over. I've got a friend who keeps pushing a certain pharm stock because he thinks some day it will be a great turnaround candidate. For those of you who read my blogs you know I'm a momentum investor/trader who dumps a stock when the price reverses but here is a value... continue

by Jim Van Meerten  |  11/25/08  |  Stocks: HOG,

A Bank That Said "NO": Tompkins Financial

Friday afternoon was the deadline for banks to apply to the Treasury's TARP program and Briefing.com was full of announcements from banks that were or were not participating. I decided to dig a little deeper into one of the banks that opted out on the theory that any bank turning down the government funds must be pretty confident in their prospects. Tompkins Financial (TMP) was the first 'thanks, but no thanks' announcement I saw, so decided to peel back a... continue

by Russ's Picks  |  11/19/08  |  Stocks: TMP,

Buy And Hold: Beware The Devil You Don't Know

I fully intended to write an article bashing the buy and hold strategy, and indeed part of me still wants to write such an article. There is much to bash. I even had a title prepared: Buy and Hold Didn't Die, It Never Really Lived. (Cue the YouTube video of Braveheart) But alas, it is difficult to confirm the death of buy and hold investing when so few of its defenders actually mean the same thing when they defend it.... continue

by Randal LaBine  |  11/18/08

Exposure to the Forex using Currency ETFs

Over the past three months, the US Dollar has been on a tear against the other global currencies. The dollar has gained, or more accurately "won back," 20% against the Euro, British Pound and Canadian Dollar in the past three months alone. In some cases this has reversed losses made over a year or more. This three month trend is not unique in the world of the Foreign Exchange. The valuation of one currency versus the other is primarily driven... continue

by thinkorswim  |  11/17/08  |  Stocks: FXA, FXB, FXC, FXE, FXF, FXM, FXS, FXY,

ABX and CMBX Markets Update

One thing that has most certainly surprised me during the Money Show in DC was the fact that there are still were so many visitors, despite the fact that the world is supposedly crumbling around us as we speak. The talk of the Great Depression and Armageddon hasn't really disappeared after the election as one might have hoped, and the only thing that seems to be changing daily is the finger pointing part- one day it's the Wall Street, the... continue

by Vad Yazvinski  |  11/14/08

Calling All Cellular Service Providers: The Trends Are Loud and Clear

Can you hear me now? Apparently yes - if you are one of the two leading cellular service providers. In September, we conducted a consumer survey on cellular service provider trends, and took a closer look at what is now clearly a two-horse race for leadership of the industry between AT&T (T) and Verizon (VZ). A total of 2,883 members of the ChangeWave Research Network participated. In the hotly contested battle for current market share among cell phone owners, AT&T... continue

by Paul Carton  |  11/13/08  |  Stocks: T, VZ,

The Death of Buy and Hold?

On Monday night, the Fast Money crew talked about the death of buy-and-hold investing. I agree that as a strategy, it's in intensive care, but I'm not so sure it's quite dead yet. First, whenever people start talking about the death of something, particularly with investing, it often the moment it's about to surge. The classic example of this is Business Week's "Death of Equities" cover from 1979. The other reason for my skepticism is a misunderstanding of the arguments... continue

by Eddy Elfenbein  |  11/12/08

Expanding Credit -- the Silver Lining

The headlines remain mostly gloomy. The economy keeps losing jobs - losing 240,000 jobs in October. Unemployment is up to 6.5% and is probably going higher. Manufacturing is down. Consumer confidence has plunged to the lowest reading in years. Corporate earnings reports tell a tale of a slowing global economy. Surprisingly, most media commentators still have not recognized the most important positive story. The LIBOR rate has come down. The interest rate on 30-year mortgages is coming down. The commercial... continue

by John Dessauer  |  11/11/08  |  Stocks: DIS,

Processing a Tough Economy - Graham Corporation Earnings Review

Graham (GHM) is a small company that was just included in the Russell 2000 this past summer. GHM manufactures processing equipment; the big heat exchangers, ejectors and vacuum equipment used in refineries, chemical processing and other process industries. This was by far my biggest dollar and percentage winner from the two Strategy Lab Open rounds. The stock has been very volatile over the past year with a split adjusted 52-week trading range of $12.50 - $54.91. The 6 November close... continue

by Russ's Picks  |  11/10/08  |  Stocks: GHM,

Software Industry Trends: Bleak Corporate Spending Outlook

A greater than expected pullback is occurring in software spending. That's according to ChangeWave's latest corporate software survey, which points to a striking deterioration in software spending plans for the next 90 days. Moreover, in a sharp reminder of the severity of the current U.S. recession, the purchasing decline cuts across all software categories. The ChangeWave survey was conducted October 6-15, 2008, and a total of 1,841 respondents involved with their company's software spending participated. Software Industry Faces Hard Times... continue

by Paul Carton  |  11/07/08  |  Stocks: CTXS, IBM, MSFT, ORCL, SAP, VMW,

Trading in a Down Market

Trading in a bear market can present volatile market swings and really hurt if you continually fight the downward trend. This is especially important if you have a long stock position in a 401K or IRA account. You should consider opening up a cash or margin account to offset some of the risk of being solely long stock and mutual funds in your tax-deferred accounts. You can trade bearish positions within your cash account that are still premium-selling, theta-collecting trades.... continue

by thinkorswim  |  11/06/08  |  Stocks: DIA,

Defined Benefit Plans - Another BIG Shoe to Drop!

The general market is still in a range where all the major indexes appear to still be trading lower at the end of the month than they traded on the first day of the month. The downward spiral is still there but slowing at a very cautious pace. I'm not sure we are at the bottom but it may be close. I'm not worried about calling the turn, I am willing to give up the top and bottom 10% of... continue

by Jim Van Meerten  |  11/05/08

ETF Investors Lose $94.14 Billion in October's Tempest

Investors lost $94.14 billion in exchange-traded funds in October, the worst returns in the industry's short history. Broad diversification actually hampered returns, as ETFs representing foreign bourses and commodities brought the total average decline to 17.4%, worse than the 16.5% decline of SPDR S&P 500 Trust, the investable form of the S&P 500 Index, which is the largest ETF. Forget about hiding from this bear market—it's taking down everything from Grandmother's gold to Brazil nuts. If you weren't short, you... continue

by Tim Middleton  |  11/04/08  |  Stocks: EEM, GLD, IEF, OIH, PHO, SHY, SKF, VNQ, XLV,

Buying Activision On EA's Miss

Electronic Arts, long considered the king of video game publishing, reported earnings Thursday that met estimates to the penny. However, EA's guidance was less than stellar, and as I write this (3:20pm, Halloween Friday) the stock is getting punished to the tune of -17%. Where it will close is anyone's guess in this volatility. But the bigger question for video game investors is this: Should we be worried about the video game industry, or just about EA in particular? There... continue

by Randal LaBine  |  11/03/08  |  Stocks: ATVI, ERTS, THQI,

What to Look for in Preferred Stocks

As an example below is a list of Bank of America prefs and their approximate return potential during the next 12 months or so. Obviously, this is my opinion of their potential only, and thus is not a recommendation in any way, but it does appear as if some of prefs of the companies BofA acquired over the last several years (Countrywide, MBNA and Fleet) are currently mispriced and offer an additional return when compared to the regular BAC prefs.... continue

by Vad Yazvinski  |  10/31/08  |  Stocks: BAC, DB, HSBC, JPM, STI, WFC,

ChangeWave Survey Foretold Apple's Earnings Call

Steve Jobs must be keeping a close eye on our ChangeWave survey findings. In a highly unusual move, he participated in Apple (AAPL) earnings phone call last week to ensure investors that despite the economic slowdown there's no reason to worry. And he did so even though Apple's outlook going forward came in well below the Street's expectations -- exactly as our September ChangeWave survey had predicted. In the conference call, CFO Peter Oppenheimer estimated Apple's sales would come in... continue

by Paul Carton  |  10/30/08  |  Stocks: AAPL,

Dollar/Yen Relationship

As the Japanese yen and US dollar continue their seemingly inexorable rise, it's becoming more and more clear just how large and diversified this market has become. The yen reached the almost unheard of level of 93 to 1 USD in early trading Tuesday while the dollar continues to appreciate against other major, and emerging, market, currencies. Even though the Yen quickly reversed from those levels, it still remains elevated relative to historic norms. Along with share prices and property... continue

by Jeff Manera  |  10/29/08

Fast Food and Steady Earnings - McDonalds 3rd Quarter Earnings Review

On Wed morning, McDonald's (MCD) reported per share earnings of $1.05, enough for something off the Dollar Menu with change back. Analysts were expecting $0.98. For the first nine months of 2008, MCD has earned $2.89 per share putting them on track to exceed analysts' full year 2008 estimates. Comparable sales and operating income were up in all global regions even after adjusting European and Asia, Pacific, Middle East and Africa sales for currency exchange rates. In the press release,... continue

by Russ's Picks  |  10/28/08  |  Stocks: MCD,

When Will It Turnaround?

Now that the S&P 500 hit another new low, investors are curious when things will finally turnaround. Is every rally just a bear market rally? The market hit a major intra-day level low exactly two weeks ago, and we've been hovering above it ever since. I'm no technical analyst but it does seem that the market likes to test its recent lows, and if no new low is made, prices rally. Fortunately, we didn't break through the intra-day low from... continue

by Eddy Elfenbein  |  10/25/08  |  Stocks: SPY,

My Opinion of the Bailout

Many of you have asked me what I think of the massive financial bailout package that was just passed by Congress. Basically, I think the package is merely a small Band-Aid on a very large problem. In fact, the bailout package won't begin to absorb the costs of the credit crisis which have now reached $1.8 trillion. I should add that that the $1.8 trillion figure doesn't even include the money that Treasury may have to loan the FDIC after... continue

by Louis Navellier  |  10/06/08  |  Stocks: GE, WB, WFC,

Candy Store

I am not a frequent NY Times reader but thought this article was a pretty good description of how events unfolded last week... "If we don't do this, we may not have an economy on Monday." -- Ben Bernanke Panic can cause a prudent person to do rational things that can contribute to the failure of an institution." -- William A. Ackman of the hedge fund Pershing Square Capital Management. Credit markets are completely frozen, fear is everywhere, but selling... continue

by Vad Yazvinski  |  10/03/08  |  Stocks: VIX,

Bailout Noise, Crazy Volatility, and Stocks to "Play"

I was traveling the day the Dow plunged 777 points, and was shocked when I heard about it even though I've had in mind for a while that a stock market crash is a real possibility. That was a glimpse of what could happen to the stock market if the credit markets don't stabilize. If most people are like me, there is a general lack of public understanding as to why the credit market is so important. Simply put, many... continue

by Randal LaBine  |  10/03/08  |  Stocks: ATVI, GME, NTDOY, TTWO,

Global Economic Crisis

People, I am an OPTIMIST, but this is getting UGLY. Yes, I am DEEPLY worried. Let's face some facts. When things get BAD, almost all markets will print money. EVERY government on the planet will. Because they have to. Thinking about a market? It will depend on the country you live in. Because most global trade will stop. Why? Because of the devaluation of every monetary item we have. And, it will NOT be about money any more. It will... continue

by The Freshman  |  10/03/08

Bailout - Why the Big Rush?

The question that has been coming up again and again is why this has to be done by Friday, by early next week, why can't we take our time and do it right? One answer Hank and Ben didn't volunteer was that the quarter ends on 9/30 and all of these mark to market values on MBS need to be pegged to the prices as of Tuesday. If as we have been told none of these things have been trading,... continue

by The Freshman  |  09/26/08

Physician -- Heal Thyself

t would seem that the government is once again pursuing blunders, and is still playing "Let's save the bank". How can I say that on the day the Fed siezed WAMU, for a quick sale to JP Morgan Chase? It is the bailout plan, and it has a HUGE flaw. First, and most important is the US is standing up to try to help resolve a GLOBAL credit crisis. That is to say, the US is part of the problem,... continue

by The Freshman  |  09/26/08

The "New Deal"

"Neither a wise man nor a brave man lies down on the tracks of history to wait for the train of the future to run over him" Dwight D. Eisenhower In my opinion, we have now officially passed the point where return to the "raw capitalist" functioning of our entire economic system was still feasible... I don't know what exact form will the next phase take yet, but the current system is officially over, finished, done, caput or whatever else... continue

by The Freshman  |  09/22/08

Last Week Marked a Capitulation Low

Last week, New York Stock Exchange volume averaged over 9.3 billion shares a day, about double the normal 4-5 billion. The Dow's range was over 500 points up and down each day from Monday through Thursday, and there was a major selling panic each day, until Friday. The subsequent flight to quality drove the yield on the three-month Treasury bill down to 0.03% at the end of Wednesday! To illustrate how stressed the banking industry is, the London Interbank Offered... continue

by The Freshman  |  09/22/08  |  Stocks: AIG, C,

Massive Buying Opportunity?

On Monday, I told my New World Investor subscribers after the market's close that investors seemed most worried about the lack of a solution for the problems at insurer AIG, although both Washington Mutual and Wachovia Bank also had people worried. But that's it for the poster children of the credit implosion. With Merrill Lynch being taken over by Bank of America and Lehman headed for liquidation, getting AIG, WaMu and Wachovia resolved should not take long. Well, Tuesday night's... continue

by The Freshman  |  09/18/08  |  Stocks: AIG, WB, WM,

Oil...

With all the financial turmoil in the equity markets, it's been easy to overlook the steady slide downward in crude oil. But it has suffered a dramatic decline. As oil traded downward, we took some nice profits on the U.S. Oil Fund puts and oil continued to slide south. It's now trading at about $92 a barrel. When oil was trading at nearly $150 a barrel, I was loudly suggesting -- and scoffed at by many -- that the markets... continue

by The Freshman  |  09/18/08  |  Stocks: AIG, DO, NE, RIG,

Moral Hazard - A Danger to our Financial System

Lately Hank Paulson has drawn a line in the sand - no more bailouts - no more "moral hazard." The reasoning is, if market participants think the government will bail them out of their mistakes, they will become reckless, which is moral hazard. I disagree. The true moral hazard is created by a financial system that permits a small band of manipulators to make leveraged bets in favor negative outcomes in situations where they have no other stake in the... continue

by The Freshman  |  09/18/08  |  Stocks: AIG, FNM, FRE, GE, LEH, MBI,

A Paroxysm of Pain

Stocks have been in free fall for most of the past week, as fear has mounted and hope has faded. Virtually everything we've been talking about over the past year has been coming to fruition in a paroxysm of pain. All the debt, all the excessive leverage, all the weak business plans and wishful thinking are coming undone at once. The heat in the market now is coming from forced asset liquidations. Every hedge fund that borrowed tons of money... continue

by The Freshman  |  09/18/08

Who got us into this mess???

Bernake has been quoted on Larry Kudlow's show tonight as being in favor of this "bailout that isn't a bail out" of Freddie & Fannie and why not? He and His "Gang of 12" caused it and it gets them off the hook. There was a very interesting article in the Charlotte Observer by Dr. MIke Walden this Sunday. He is the William Neal Reynolds Distinguished Professor and Extension Economist in the Department of Agriculture and Resource Economics at the... continue

by The Freshman  |  09/12/08  |  Stocks: FNM, FRE,

Caught in a Trap...

We're caught in a trap / We can't get out.... I'm not channeling The King this week; I'm just looking at a market that has been in a long consolidation off the July bottom. Every failed advance and every aborted decline is simply adding to the congestion and increasing the available energy for the next leg, up or down. This long volatile-but-sideways pattern has established clear breakout and breakdown points on the S&P 500 at 1302 and 1235. That's an... continue

by The Freshman  |  09/12/08  |  Stocks: LEH,

Is This The Bottom? Only For Lehman...

Well, I do think Lehman Bros. (LEH) will get absorbed by someone, probably over the weekend, but your guess is as good as mine on how it shakes out. For speculation, check the latest on Bloomberg or the Wall Street Journal. First question: What will the immediate market reaction be? For the answer, flip a coin. The market could bounce, only to plummet the next day, a la Fannie and Freddie. There's just no telling. Second question: Is this type... continue

by The Freshman  |  09/12/08  |  Stocks: FNM, FRE, LEH, SKF,

Oil Prices Suffer Big (But Temporary) Drop

There are big headlines today about oil plunging to a 5-month low, losing more than $6 a barrel. Some news outlets are hyping an even bigger number, pointing to the $10 drop from the weekend high to an intraday low. Both these numbers lack an important element that is crucial to investing in this market: Perspective. Sure, it's a 5-month low. But does anyone want to guess what the average price of oil was in 2007? About $65. Even if... continue

by The Freshman  |  09/04/08

Post-Labor Day Trend Watching

While I still think the market will resolve this long period of consolidation to the upside, what I know is that between 1265 and 1302, the market is not telling us anything useful. It is just consolidating. So no one can tell you which direction the market is going to go next until the market itself tells us by either decisively breaking 1265 to the downside or 1302 to the upside. That could happen this week week, as the portfolio... continue

by The Freshman  |  09/04/08

Improvements in Home Improvement? (LOW, HD)

The latest existing home sales report from the National Association of Realtors showed an increase of 3.1% over the previous month with sales rising to about 5 million units a year annualized. When the last twelve months of data is plotted, there's a clear bottoming pattern being formed. The report also shows home prices continuing to fall and the inventory of unsold homes increasing. That's bad news for sellers but good news for buyers since the increasing inventory should continue... continue

by The Freshman  |  08/29/08  |  Stocks: HD, LOW,

Breaking News: Attempts To Call A Bottom In Financials Unsuccessful

Everyone wants to know when the financials will bottom. Despite many guesses and months of speculation by experts on CNBC and amateurs in my office, no one really knows. The folks at Investor Place Blogs have asked me several times to write on the prospects for financial stocks, and every time I have given a similar response. I'm going to review those responses below, not for the sake of saying, "I told you so," but for the sake of putting... continue

by The Freshman  |  08/29/08

China after the Olympics

Now that the Olympics are over, China is also concerned about slower growth. On Tuesday, J.P. Morgan reported that Beijing is considering a stimulus package of up to $58 billion, in addition to other monetary-policy-easing measures. J.P. Morgan's head of Chinese Research, Frank Gong, wrote that "the top leadership is carefully considering an economic stimulus package of between 200 billion and 400 billion yuan" ($29 to $58 billion). That's in addition to 600 billion yuan ($87 billion) recently spent on... continue

by The Freshman  |  08/27/08

The right way to play the oil "bounce"

"Turn your face to the sun and the shadows fall behind you." Maori Proverb As one should have expected oil and other commodities have staged a short rebound over the last several days, and while I still think oil will end the year lower, I couldn't resist to take a part in this "inevitable" bounce- what goes down so quickly has to go up for a little while :) Remember the "dead cat bounce" analogy- given how fast commodity stocks... continue

by The Freshman  |  08/22/08  |  Stocks: CSUN, CY, FCL, FSLR, JASO, LDK, SPWR, STP, VO,

Scouting for a Top

The clock is running out on the stock market's rally off the July lows. If you're sitting on stocks or funds that have given you trouble, now is the time to take your lumps and move on. Sounds pretty dire, doesn't it? Not really. I've suggested to my subscribers for the past couple of weeks that the market will probably need to drop back to the vicinity of its July lows (1214 on the Standard & Poor's 500, closing basis)... continue

by The Freshman  |  08/22/08

Here's What I Expect to Happen...

The stream of headlines and economic data pouring out of Wall Street--from the Russia-Georgia conflict to falling oil prices to a shrinking deficit to more writedowns--has shaken up investors. And the market is responding. Here's what I expect to happen: -Are we through the bad times? No, there is still a lot of bad news set to hit next year. I think it's important to name these market ogres now, recognize that they are on their way and then plan... continue

by The Freshman  |  08/22/08

Not all emerging markets are the same...

"Every beginning is a consequence - every beginning ends something" Paul Valery As I mentioned in my previous post, it does certainly appear as if the unstoppable outperformance of emerging markets has hit an invisible wall recently and is now coming to an end. But is it a logical result of slowing global growth, or rather simply a short term trend that is likely to reverse itself during the next several months? Unfortunately for the global market cheerleaders, I believe... continue

by The Freshman  |  08/15/08

An Innovative Solution to the Housing Crisis

In an interview with The Wall St Journal, former Fed chairman Alan Greenspan offers the most innovative solution to the national residential real estate crisis that I have seen. It's wacky but clever: Change immigration rules to let in a lot more skilled immigrants, who will form new US households and buy excess housing inventory. He tells the Journal the only sustainable way to increase demand for vacant houses is to spur the formation of new households. Admitting more skilled... continue

by The Freshman  |  08/15/08

What Gilead Can Teach Us about Wall Street

I'm always amazed at how irrational Wall Street can be. This is why I emphasize diversification so much, because one stock alone can often hop around without any good reason. A perfect example is Gilead Sciences (GILD) which is one of my favorite Blue Chip Growth stocks. Last month, Gilead reported earnings that were two cents shy of Wall Street's expectations. The next day, Wall Street panicked and Gilead lost $5.67 a share which was a drop of over 10%.... continue

by The Freshman  |  08/15/08  |  Stocks: GILD,

Happy Hour postponed due to technical difficulties

Due to technical difficulties, the Happy Hour scheduled for today in our chatroom has been postponed until next week. We'll be back on track in no time at all and ready to mix and mingle as planned at the same time, same place next Thursday, August 21. We hope you all stop by! With our sincerest apologies, The InvestorPlace Blogs Team... continue

by The Freshman  |  08/13/08

JUST MISSED!!! Live Chat MSN Columnist Bill Fleckenstein, Wednesday @ 2pm EST!

Bill Fleckenstein, author of the Contrarian Chronicles on MSN Money, just concluded an hour long chat hosted by Jamie Dlugosch, editor of InvestorPlace Blogs. Keep your eyes right here for the transcript which will be posted very soon on InvestorPlcaeblogs.com.... continue

by The Freshman  |  08/11/08

Bull Riding in a "Rodeo Market"

It's a rodeo market-if you can stay on the bull more than eight seconds, you win. Rodeo bulls are experienced, tricky animals that twist, jump and drop in explosive ways to unseat their riders as quickly as possible. Sound familiar? Beginning bull markets do the same thing, chasing everyone to the sidelines before they start their big up-move. Bear markets, in contrast, are like a lazy summer day by a sweet-smelling river, lulling everyone to sleep just before the flash... continue

by The Freshman  |  08/11/08

The US Economy Isn't the Only Weak Spot

I know you don't hear this on CNBC or the evening news, but Europe is suffering more than the U.S. right now. Last Tuesday, it was announced that Germany, Europe's largest economy, contracted by about 1% in the second quarter. Also on Tuesday, it was announced that the euro-zone's service sector contracted in July and is now at a five-year low. Due to declines in both the manufacturing and services indices, the overall PMI index fell to 47.8, tying a... continue

by The Freshman  |  08/11/08

Harmonic (HLIT): Music to My Ears

Harmonic (HLIT) is the leading independent producer of video broadcast and distribution equipment. The company had a history of lumpy quarters and missing guidance until Patrick Harshman took over as CEO in the June 2006 quarter. Since then, trailing four quarter revenues have grown from $234 million to $347 million after the quarter reported yesterday. The company has rationalized their operations, slightly increased head count, and made a big push for international business. They are about to open a European... continue

by The Freshman  |  08/01/08  |  Stocks: HLIT,

The Trouble in Financials is Far from Over

Last week, there was lots of new evidence of a recession brewing in the U.S. More banks failed, Chrysler ended all lease financing, and housing statistics turned even uglier. Many financial stocks were on the way up again, but after a rough Thursday we saw the massive short covering rally in financial stocks flame out. Banks experienced their biggest one-day loss in eight years, proving that the trouble in financials is far from over. This credit crisis has real impact... continue

by The Freshman  |  08/01/08

Allstate - Still a good buy

Allstate (ALL) recently reported 2Q 2008 Earnings, .05 per share, a 98% decline year over year. The decline was caused by a combination of higher than usual catastrophe losses and change in intent write-downs on the investment portfolio. While the numbers are unsettling at first glance, they do not affect my view that Allstate is undervalued based on its strong industry position and long-term earnings potential. Before going into the conference call and current issues, here is a brief overview... continue

by The Freshman  |  08/01/08  |  Stocks: ALL,

23 "common sense" investing rules from the Skeptical Capitalist

The world is round and the place which may seem like the end may also be only the beginning." -- Ivy Baker Priest We have only a few days left in this round of Strategy Lab, and while my portfolio return has been fluctuating around the double-digit range for the past several months, it has also been solidly beating all the indexes pretty much from the beginning. All in all, I am extremely happy not only with how well my... continue

by The Freshman  |  07/25/08

Will WaMu Cheat the Hangman

I'll remember Tuesday's madcap trading for a long time. How often does a blue chip company report an $8.9 billion quarterly loss -- and the stock proceeds to skyrocket 27% in a single session? Yet that's exactly what happened with Wachovia (WB). The North Carolina-based bank not only announced that eye-popping loss but also slashed its dividend for the second time this year. Predictably (one might almost say, sensibly), the shares plunged in the market's opening minutes. But then, suddenly,... continue

by The Freshman  |  07/25/08  |  Stocks: wm,

JUST MISSED! Jim Jubak of MSN Money Joined InvestorPlace Blogs for an Exclusive Chat

If you missed the dynamic and informative chat with MSN Money's Jim Jubak that took place Wednesday in the InvestorPlace Blogs Chatroom, you can now read the entire transcript here. This famed contrarian shared his views on the market as well as insights into the economy and some of his favorite stock picks. The transcript for the chat will be posted asap! And keep an eye out for future chats hosted by InvestorPlace Blogs' very own Jamie Dlugosch.... continue

by The Freshman  |  07/23/08

Make Money in Bank Stocks

This week the editors asked for comments on the financial industry, the banking sector in particular and I have to admit I'm very afraid of individual banking stocks. I don't think there is any analyst in the industry who can honestly analyze the numbers. I have an accounting and a law degree and have passed the GA CPA, Certified Internal Auditor and Georgia Bar Exams and I wouldn't even to attempt to read and tear apart any bank's 10Q. I... continue

by The Freshman  |  07/18/08  |  Stocks: SKF, UYG,

The Lunatics are Running the SEC

In the classic Edgar Allen Poe story, The System of Dr Tarr and Professor Fether, a gentleman visiting an insane asylum learning about the innovative methods of treating the inmates, sees that many bizarre practices are being employed for treatment. By the end of the story, he realizes that the inmates had overpowered their keepers, and the lunatics were running the asylum. The idea is that those that are in charge that should be looking out for society's best interest... continue

by The Freshman  |  07/18/08  |  Stocks: BSC, FNM, FRE, LEH,

Making Money off of Volatility Moves

Writing on July 3rd. Happy Independence Day and welcome back to the Daily Swim. As I wrote about before, earnings season will soon be upon us with July 8th marking the beginning of the season and the announcement of Alcoa (AA) earnings. Hopefully, you have been tracking the front month implied volatility since my last post when July volatility was trading 52%. As I noted before, implied volatility tends to increase as the earnings date approaches. If we look at... continue

by The Freshman  |  07/18/08  |  Stocks: AA,

Oil and Airlines - One way to Profit...

Airlines have been especially hard hit by the spike in crude oil prices. This week they got to together and made some noise, targeting the oil speculators and the opaque commodity futures markets in general as a major contributor to the recent nearly vertical rise in crude and its distillates (such as gasoline, heating oil and jet fuel). A consortium of 12 U.S. airlines sent a letter to Congress, correctly stating that oil speculators currently purchase 66% of all oil... continue

by The Freshman  |  07/11/08

iRobot's New Invention Makes the Cut

iRobot (IRBT) recently filed an 84-page patent for a robot lawnmower. The "Lawnba" filing covers an all-electric or a hybrid gas/electric mower in various configurations, from the Roomba disc shape to a pentagon, with two to five cutting heads. It uses optical and acoustic sensors to stay away from hard surfaces, water or barriers, and can sense uncut grass. The barrier methods include perimeter wires, solar-powered spikes GPS navigation as well as a radio beacon. RFID tags or proximity sensors... continue

by The Freshman  |  07/11/08  |  Stocks: IRBT,

Interested in Annuities?

There's an old investment tool that, after falling out of favor in the past few years, may be on the verge of a comeback. I'm talking about annuities. Annuities aren't designed to shoot out the lights in terms of investment performance. They do carry costs. However, they can also save on taxes (a key benefit if tax rates go up under a new presidency), while providing certain valuable guarantees. Here's a quick overview of how annuities work. You deposit money... continue

by The Freshman  |  07/11/08

Wells Fargo - Almost There

So far 2008 has not been a lot of fun for the management and shareholders of Wells Fargo (WFC).Shares in the bank trade at the lowest levels in 5 years and are less than a dollar off of 52 week lows. The bank has been hit by its large exposure to residential real estate, particularly the difficult California markets. Analysts have steadily downgraded the stock pointing out that continued consumer weakness is going to make it difficult for debts to... continue

by Tim Melvin  |  07/07/08  |  Stocks: WFC,

Will July 4th Weekend Bring A Rally? Or Panic? Or Both?

Time for a context check. There will be a bear market rally at some point. The beginning of a bear market rally never feels good--usually you're so sick of the downtrend that you want to puke up your stocks at the first sign of better prices. Are we close to that point? I don't know. I should mention that I didn't sell any of my short ETFs today, although I was tempted. What stopped me? The panic didn't seem panicky... continue

by The Freshman  |  07/03/08

Top 3 Techniques to Get You Through the Tough Times

If there's anything investors crave in these unsettled times, it's stability. They're looking for a little peace of mind. But where do you find it? Many folks look in the wrong places and come up disappointed. You don't have to be one of those people. With three reliable techniques you can control your risk in today's roller-coaster markets. With a stable base under you, you can reach for all the great growth opportunities that our dynamic global economy has to... continue

by The Freshman  |  07/03/08

Will China Meddling Save Chinese Markets?

That's the problem with free markets: when they are making everyone money, they're the best thing since electronic trading. When they are going into the toilet, everyone collectively curses, assigns blame, and jumps out the nearest window--Unless you happen to be in a pseudo-free market, like China. The Chinese markets are in turmoil right now, clocking a 40% plus loss since last October--and we think we have it bad. For those with money in FXP, the ultrashort China ETF, it's... continue

by The Freshman  |  07/03/08  |  Stocks: FXP,

Harmonic (HLIT): A 4-Star Technology Performer

My New World Investor subscribers have owned Harmonic (HLIT) since I first recommended it almost two years ago. So what could cause me to hold a stock for such a long span of time? The truth is that I just love a good innovative buy. Who doesn't? Just today this stock caught a little press attention when it's Direct-to-Edge cable IPTV solution, Media Prism, a demand content preparation soft ware, and it's PWRLink 1310 nm DWDM transmitters both earned 4-star... continue

by The Freshman  |  06/27/08  |  Stocks: BGR, HLIT,

A United Fed

Why are we still moving down? In other words, why can't the Fed just fix this thing like it has so many times in the past? We need to understand the Fed's action through the prism of the dollar. For the first time in the postwar era, our central bankers are fighting a two-front war. On the one hand, they must cut interest rates to a level at which home mortgages become so affordable that the depressed residential construction market... continue

by The Freshman  |  06/27/08

Total World Stock Index (VTWSX) Launches, Fees Drop

Vanguard Total World Stock Index (ticker symbol: VTWSX) is now trading. Tracking the FTSE All-World Index, a benchmark of a bit under 3,000 stocks in 47 countries, it's the first global stock index fund at Vanguard, coming head to head with Global Equity (VHGEX), Vanguard's actively managed global fund. Duane F. Kelly and Ryan E. Ludt will co-manage the new fund from within Vanguard's indexing shop. Like many of the Vanguard index funds, Total World Stock Index comes complete with... continue

by The Freshman  |  06/27/08  |  Stocks: VHGEX, VT, VTWSX,

A Little Excitement in my Trading

I have to come clean and admit that I occasionally like a little excitement in my trading. Sure I love to make money and be profitable with high probability spreads that have defined risk, but that can be dull. And I don't mind dull to make money. Understand I use these strategies (Verticals, Iron Condors) continually as my revenue generator so that I can take very small pieces of capital and get kooky with them. When I say kooky I... continue

by The Freshman  |  06/20/08

Stay Away from Goldman Sachs

Goldman Sachs (GS) reported earnings today of just over $2 billion which was more than Wall Street was expecting. Despite the good news, I still don't favor owning the shares. The financial mess isn't over just yet. Goldman's profit last quarter was 10% lower than the year before. This was still a big improvement from the first quarter when Goldman's profit was cut in half. I give the company a lot of credit for managing its way through this crisis... continue

by The Freshman  |  06/20/08  |  Stocks: gs,

How to Invest: Doing the Opposite and Playing Defense

Over the weekend, I was thinking of George Costanza and how to invest in the market. Last week was certainly volatile, and I'm sure produced the kind of frustration for traders that someone like George could appreciate. But by following the George method of doing the opposite of what seemed right, you would have made money. Consider this: Since last Monday, June 9th, the market has gone the opposite direction of how it opened every day except for one suspicious... continue

by The Freshman  |  06/20/08

Fannie Who?

Fannie Mae (FNM) has been a bastion in the finance world for many new and moving up homeowners. Until the subprime crisis, I'd have called the stock a bedrock in any portfolio. Fast forward from high praise to current conditions. My message is to run, run, run from this and most of the financial stocks. Sure value players are probably casting gleeful eyes at Fannie now that the price has dropped precipitously. But waiting for the rise in value stocks... continue

by The Freshman  |  06/06/08  |  Stocks: FNM,

Research In Motion Blows Away the Competition - Even As Overall IT Spending Remains Soft

Defying an otherwise weak IT spending environment, Research In Motion (RIMM) is continuing to blow away the competition -- expanding on its already vast share of the corporate smart phone market. Corporate IT spending is far less robust elsewhere, however. After a long and unsettling decline there are signs the spending slowdown may be stabilizing. First, the good news from ChangeWave's May survey of 2,049 respondents involved with IT spending in their organization -- it's all about smart phones. In... continue

by The Freshman  |  06/06/08  |  Stocks: AAPL, PALM, RIMM,

The Elephant in the Room - MBI & ABK

Moody's is reviewing MBI and ABK for likely downgrades to Aa, or in MBI's case, A. This has generated a lot of news coverage, but rather than rehash that information this post will focus on the question - why the prices for CDS referencing ABK or MBI imply junk status, while the ratings agencies have been holding the line at triple A or double A? This has been referred to as the Elephant in the Room, so's let's start a... continue

by The Freshman  |  06/06/08  |  Stocks: ABK, MBI,

What the Cost of Oil Might Do to Airline Stocks

Warren Buffett is famously averse to airlines. You can't help but wonder if the cost of oil has something to do with his sentiment. He said that between the first flight at Kitty Hawk and the present day, the net return from money spent on airlines is zero or less than zero. After a misadventure investing in an airline, he declared himself an "aeroholic" and claimed to have an 800 number he can call so someone will talk him out... continue

by The Freshman  |  05/23/08  |  Stocks: AMR, LUV,

UnitedHealth Group - A healthy investment?

UnitedHealth Group (UNH) is involved in what I would consider one of the more complex industries in the country and what has to be one of the more essential products we all need -- health insurance. With the ballooning costs of health care services, government regulation and a moral duty to decide if a procedure or treatment is necessary, and bottom line to the health insurers, is it worth the cost? As an example of this dilemma, I saw a... continue

by The Freshman  |  05/23/08  |  Stocks: UNH,

Starbucks: Can The Mermaid Mimic Ronald McDonald?

I'm sipping a latte this morning, and it's not from Starbucks (SBUX), despite the retro "edgy" logo they're trying out. The beans are also not from Starbucks, nor is the mug. In fact, I rarely go to SBUX, as it's become the McDonald's (MCD) of coffee--fast, not especially good if you are a coffee connoisseur, but consistent if you're in a pinch. And I do like the retro logo--it's strange, and when was the last time you saw something strange... continue

by The Freshman  |  05/23/08  |  Stocks: MCD, SBUX,

The Mortgage Meltdown Continues

The bad news regarding housing values and foreclosures continues. Because of the major downturn in property values in the areas of the country where prices increased so much during the boom many homeowners are finding themselves owing more on their mortgages than their houses are worth (upside down). There is a great expectation that many people in this position will simply walk away from their mortgages and houses. This phenomena will not just affect sub-prime loans, but even fixed loans... continue

by The Freshman  |  05/14/08

AIG - More Mark to Market

American International Group (AIG) is the nation's largest insurer, and operates on a global scale. The company just reported a very large loss for the 1st quarter, 7.8 billion, and in addition to bearing the blame for the market's poor start this morning was rewarded with downgrades from S&P and Fitch. The company plans to raise 12.5 billion in order to fortify their balance sheet: as they explain it, to restore their capital cushion to around 20 billion which they... continue

by The Freshman  |  05/14/08  |  Stocks: AIG,

Tape Readers, Take Notice

Ok...Ok...Ok, so the tape says the market wants to go higher. SPX recently drove above 1400. Now the market is resting just below this important level, but recent selling has been rather light. Many traders looking at the SPX charts see bottoming formations such as a double bottom or inverted head and shoulders. Either one is bullish. If we consider ourselves tape followers we must assume prices will go higher..... Thinking positive delta on strong stocks in industries that are... continue

by The Freshman  |  05/14/08  |  Stocks: SPX, SPY,

HNR: Is the recent price drop justified by deterioration in fundamentals?

I have previously posted about my rationale for a large position (in fact my largest holding) in Harvest Natural Resources (NYSE:HNR). Lately, the stock has not done too well - in fact it is down about 25% in the last few weeks. So I have been doing some digging to see if anything changed regarding the fundamentals. The main trigger for the decline seems to be an analyst downgrade (2 levels below previous). Rather strangely, the main reason he gave... continue

by Kim Stup  |  05/07/08

Has Berkshire Lost Its Hathaway?

How is Buffett doing in his plan to take over the municipal bond insurance market? The Berkshire Hathaway shareholders meeting featured a discussion of progress to date, as well as the potential risk to the financial system posed by the large amount of outstanding credit default swaps. For a person who once characterized derivatives as financial instruments of mass destruction, Buffett is very comfortable with them, remarking that Berkshire has written two types of them and expects to make very... continue

by Kim Stup  |  05/07/08

Time for the Fed to Stop

"In matters of style swim with the current, in matters of principle-stand like a rock" -Thomas Jefferson Someone famous once said "Invest in inflation. It's the only thing that is going up" and you know what- I could not agree more. In this world of fiat money one thing is guaranteed - your money will be worth less tomorrow than today. As you might have guessed from my previous posts I am not a great believer in politicians' abilities to... continue

by The Freshman  |  05/01/08

Throwing Oil Overboard - The Case for $90 Oil

$90 Oil? Are you serious? Yes I am. In fact, I jumped on the train selling oil short last week. More about the trades in a bit. The dents in the armor of skyrocketing oil are already in place, and the stage is being set for oil to fall. Most players are on the opposite side, looking to ride oil past $200 and beyond. I not only view even higher oil prices unlikely, but $200 oil is next to impossible... continue

by The Freshman  |  05/01/08  |  Stocks: DCR, DUG,

Another Boring Dividend Stock - SYY

I took nibble at another income stock yesterday. Sysco, the food and restaurant supply company. SYY is one of the 319 Mergent Dividend Achievers, meaning they have a long track record of annual dividend hikes. If I did the math correctly, the last 10-years' dividend hikes have all been double digit increases. Fundamentals are reasonable; forward PE of about 15, PEG of 1.22, and dividend yield of 3.2% with a 45% payout ratio. Today's close of 30.68 is near the... continue

by The Freshman  |  05/01/08  |  Stocks: SYY,

Why is the market rising and where do we go from here...?

Nature gave men two ends - one to sit on and one to think with. Ever since then man's success or failure has been dependent on the one he used most" George R. Kirkpatrick It's been full four weeks since I decided it was time to go long the market. At the time being bullish was quite unpopular, as fear was still ruling the market and thus it was a relatively easy call for me that in hindsight seem to... continue

by Hillary Mark  |  04/25/08  |  Stocks: JASO, MELI, RIG, SLB, VO, W,

Five Factors Helping Earnings

Even if the economy has an anemic recovery, corporate earnings are poised to surge in the second half of 2008. Third quarter earnings should rise by 30% and fourth-quarter earnings should rise by an amazing 70%. This will be the strongest earnings growth for the S&P 500 in decades. I know what you are thinking, "How can earnings surge so dramatically when it's not yet clear how strong the recovery will be?" Well, it's not that difficult to explain. The... continue

by Hillary Mark  |  04/25/08  |  Stocks: ^GSPC,

Airlines: Ouch!

At the onset of SLO2 I put one third of my portfolio into airlines. The airlines have done very poorly in the last few months. My thesis for airlines had three components and all three are still in play. I expect these components to come to fruition in two to three years, but the contest has a limited time horizon and I have no expectation any of them will recover by the end of this contest. I have sold all... continue

by Hillary Mark  |  04/25/08  |  Stocks: DAL, NWA,

34 Reasons Why This Market Bottomed

Starting back on January 22, 2008, John Lansing began giving reasons this market bottomed. He brings you these 34 reasons in his latest blog entry. Here are the top 5 reasons. Get reasons 6-34 when you click to read more! 1. The SP500 currently has a current Price/Earnings ratio of 14 and a forward P/E of 16.7. The SP500 has never, ever, topped with a P/E at these low levels. 2. A Bear market is defined as any market in... continue

by The Freshman  |  04/23/08  |  Stocks: CAT, CROX, CSCO, CSX, INTEL, JBHT, QCOM, RIMM, VSEA, WMT,

WaMu (WM) - Whats that smell?

I have heard investors asking since late 2007 have financials hit a bottom and when should I jump in? I don't think the economy is in near as bad a shape as most think, but I wouldn't buy these financials with your money! Citi (C) seems to have begun to right the ship, but if you listen to most of the prognosticators, you have the other shoes ready to be dropped-credit cards and commercial loans. I think the losses or... continue

by The Freshman  |  04/23/08  |  Stocks: C, WM,

Baby Boomers Go 'Bionic' as Body Replacement Devices Soar in Popularity

Many of us old enough to recall the 1970s TV show "The Six Million Dollar Man," know it was about a guy severely injured in a plane crash who was subsequently "rebuilt" in a high-tech, clandestine medical procedure costing six million dollars. In the show, the main character's right arm, left eye and both legs were replaced by "bionic" body parts that enhanced his strength, speed and vision far beyond that of mortal humans. Back then it was practically all... continue

by The Freshman  |  04/23/08  |  Stocks: MDT, SYK, ZMH,

Positioning for the Coming Commodities Bust

SLO players, including myself, have been loaded with great performing commodity stocks and ETFs that have buoyed us in the turbulent markets. Just take a minute to gaze at the portfolios of some of the top 50, and you'll see many with agriculture holdings (MON, MOS, POT, ADM), many with miners (PCU, BHP, AAUK, FCX, NEM, GC), and of course, coal and steel. Commodities have been king, and I am slowly jumping off of the bandwagon and shifting money the... continue

by The Freshman  |  04/15/08  |  Stocks: AAUK, ADM, BG, BHP, FCX, GC, GLD, MON, MOO, MOS, NEM, PCU, POT, SMN, SYT,

Cobra (COBR): Name Brand Merchandise - Cheap

Cobra (COBR) is the number one brand in the domestic radar detection market. Other products include CB radio, power inverters, marine products, and mobile navigation. They were unable to compete successfully with the likes of Garmin (GRMN) in mobile navigation and wrote off a lot of their investment in the area at the end of 2007. They will continue to compete in certain niche areas. It closed Friday at 3.12, a substantial discount to its tangible book value of 5.69.... continue

by The Freshman  |  04/15/08  |  Stocks: COBR, GRMN,

U.S. Inflation Worries Spiral as Spending Falls and Customers Stream to Costco and Wal-Mart

The discounters are back in vogue as inflation rears its ugly head. That's the verdict from ChangeWave's latest consumer survey, which shows a large-scale movement to discount retailers driven by skyrocketing inflation and an overall spending environment that continues to slow. The ChangeWave survey of 4,735 consumers, completed April 7th, looked at spending for the next 90 days. In a clear sign the economic downturn isn't over yet, this is the third-consecutive ChangeWave survey in 2008 showing a recession in... continue

by The Freshman  |  04/15/08  |  Stocks: COST, GPS, JCP, LIN, M, SHLD, VPHM, WMT,

Stock of the Week: Mosaic

Earnings season begins in just a few days for my Blue Chip Growth stocks. Subscribers can see the entire calendar of earnings here. We recently had some final earnings reports from companies whose quarter ended in February. The clear standout was Mosaic (MOS) which is this week's Stock of the Week. Mosaic is one of the world's largest makers of phosphate and potash crop nutrients. With the continued high price of corn, soybeans, wheat and other commodities that are in... continue

by The Freshman  |  04/10/08  |  Stocks: MOS,

Taking Jubak Behind the Woodshed

I couldn't believe what I read this morning when I checked in on the MSN money page and read Jubak's article entitled, "Where's the bailout for Main Street?" I feel like I am being a malcontent here, since I just railed on Jon Markman recently, and now I turn my aim toward Jim Jubak, someone who I respect (though I have never met him) and make his articles required reading. Here's a shout to Jubak, Markman, and anyone else who... continue

by The Freshman  |  04/10/08  |  Stocks: BKC, BP, FXP, MCD, PFE, RDSA, SBUX, WEN, XOM,

New Skeptical Capitalistic Ideas for the next 6-12 months...

As some of the more frequent visitors to my blog might already know, my investing style is somewhat different from a typical money manager out there. A significant portion of my portfolio is selected based on somewhat mechanical basis- it is intended to serve as a "hedge" against my more aggressive short and contrarian picks. Remember, the quant screens I use, utilize a number of factors that I personally (not necessarily conventional Wall Street quant funds) consider important. A lot... continue

by The Freshman  |  04/10/08  |  Stocks: APH, CELG, CLB, PACR, PPDI, RPM, SPN, WSONE,

Wal-mart to America: Smile, You Can't Afford Better Stuff!

I'll get to Wal-mart (WMT) in a minute--first, some context. Lately in my Strategy Lab portfolio, I've had quite a bit of churn. Why? Nothing seems to stick. One day, commodities are the only bull market; the next day, they are toast. One day, financials are an easy short; the next day, they rally sharply. There are two alternatives to churn: 1) Buy and hold. 2) Cash. Buy and hold, in this market, will get you crushed. On CNN the... continue

by Kim Stup  |  04/01/08

Apple vs RIM: Smart Phone Wars

The release of the Apple (AAPL) iPhone rocked the cellular industry last year, and some analysts are now asking if the pending release of Google's (GOOG) Android cellular phone operating system may have a similar impact. The answer: Not likely. According to a March 17-24 ChangeWave survey of 3,597 consumers, the smart phone industry continues to transform into a two-horse race between Research-in-Motion's (RIMM) BlackBerry and Apple's iPhone. While RIM currently dominates smart phone sales among consumers, the Apple iPhone... continue

by Kim Stup  |  04/01/08

Why Investment Banks are Not Cheap

"The unfortunate thing about this world is that good habits are so much easier to give up than bad ones" Somerset Maugham Here we go again-another backward looking February economic number came out early this morning and for whatever reason- stocks reacted to it... I mean, let's get real here. Why would anyone worry whether the GDP growth for Q4 2007 ended was confirmed at 0.6%? The original number has been reported weeks ago...I am struggling to understand why would... continue

by The Freshman  |  03/28/08  |  Stocks: BAC, JPM, WFC,

Apple (AAPL) - Navellier Stock of the Week

You can see my latest Stock of the Week feature at my NavellierGrowth.com website. This week's featured stock is Apple (AAPL). My Blue Chip Growth subscribers and I have taken a big bite out of Apple (AAPL)-to the tune of 354% profits since December 2004! Apple is benefiting from traditionally strong computer sales as well as the explosion in digital music, which it dominates with its iPod. In case you don't know what the iPod fuss is about, just ask... continue

by The Freshman  |  03/28/08  |  Stocks: AAPL,

LDK - Solar Stocks are "Hot"!

LDK is 1 of many players in the solar energy field. With the rapid increase in oil prices solar power is again on the front burner. There is no doubt solar will play a part in our future energy sources. But,how much and when is up to the solar companies such as LDK and when the cost basis for solar power is comparable to the public utilities energy cost. Solar power has been used in the most basic application for... continue

by The Freshman  |  03/28/08  |  Stocks: LDK,

LDK Solar: Solar Power

You probably remember the old Elton John song "Don't Let the Sun Go Down on Me." Well that's a song many players in the fast-growing solar power industry keep singing! Solar power is hot. Solar has become a buzz word in the renewable and alternative energy circles and with good reason, with oil at record levels over $110 a barrel and our planet struggling under the heavy haze of global warming and pollution after more than a century of concentrated... continue

by Kim Stup  |  03/24/08

Has a "Great Unwinding" Already Begun?

On Wednesday, Citigroup issued a fascinating report, which talked about the "Great Unwind," as markets and economies de-leverage across the globe. Citigroup strategists warned investors that they should avoid companies and countries (like the U.S.) that have grown to rely on too much borrowed money. Specifically, Citigroup predicted that hedge funds, private equity funds and real estate investments would lose market share and that plain old stock investing would likely pick up the slack and become increasingly attractive as investors... continue

by Kim Stup  |  03/24/08

Consumer Electronics Gets Whacked

Retail sales turbulence has slammed into the consumer electronics industry with a vengeance. ChangeWave's latest survey shows a sudden huge pullback in consumer retail purchasing on electronics by U.S. consumers - the largest one since we began measuring spending trends back in 2002. The February 18-25 survey of 4,427 consumers looked at a range of popular gadgets in the consumer electronics industry, including digital cameras, iPods and video game consoles. Only 19% of survey respondents say they'll spend more on... continue

by Kim Stup  |  03/21/08

Gold is Headed Higher

Sometimes I feel like the priestress of Troy, Cassandra, who urged it's citizens to "Beware of Greeks bearing gifts." Folks, the Fed are the Greeks and the gifts they are offering will stress our financial system. All of the "smart" traders baled out of gold the past two days and booked profits. I suffered a 7 percent decline in my portfolio, but I'm holding on. Why? Because a new twist can arrive at any moment and gold will resume it's... continue

by Kim Stup  |  03/21/08

Common Sense Econ: A Real Life Lesson

There have been several players posting blogs lamenting Bear Stearns, lamenting the dollar going down the tubes, lamenting commodity prices, and worried that we are headed into a depression. Take a collective deep breath, folks. It's not that bad. You have choices here. Let me give you a real life example of economics in action. Back in January of 1997, I was a mere PFC in the United States Marine Corps doing training at Camp Geiger, North Carolina. My unit's... continue

by Kim Stup  |  03/21/08

Risk, Volatility, Margin Calls, and Loss -- The Four Horsemen of the Stock Market Apocalypse

Here we are, guests at a Stockpicker's party. At a country estate, on the carefully landscaped grounds of a newly built mansion, we are enjoying a pleasant gathering, chatting with old friends, sipping a drink, munching on various delicacies, strolling through the spacious formal gardens. I forget who our host is, it doesn't really matter, there's plenty of good food and a truly wonderful spirit of companionship and camaraderie among all concerned. Day Traders, Active Traders, Swing Traders, Investors, Speculators,... continue

by The Freshman  |  03/17/08

Bearly Stearn: The Bailout of Bear Stearns

I want you all to stand up, open a window and yell, "I'm as mad as hell and I'm not going to take this any more". If we are truly headed back to the 70's we may as well quote the classic movie, Network. Friday's bailout of Bear Stearns (BSC) may very well begin the domino action that many have feared and the central bank is determined to avoid. We should all be concerned and frankly a bit mad. I... continue

by Kim Stup  |  03/17/08

Bear Stearns Cos: Collapse of Wonderland

Bear Sterns is being sold to JPM for a mere $2 a share which represents less than 3% of the company's book value... Too bad for anyone who believed in the "sure thing" earnings of the investment banks and wondered why in the hell would they sell at such ridiculously low P/E multiples... I am fully aware that tomorrow is likely going to bring a lot more pain to the net worth of most investors out there, I think that... continue

by Kim Stup  |  03/17/08

Crocs Director Marks Buys 250,000 Shares

Investors starved for good news can look to company insiders for one of the few positive signals about a market rattled by a credit crisis, falling consumer sentiment, rising unemployment and mounting fears of a recession. Analysts look to the buying and selling trends of insiders, who are typically long-term investors, for clues to the broader market outlook. Insider buying reached multiyear highs last August, when the subprime market meltdown first hammered stocks before they recovered somewhat in the fall.... continue

by Kim Stup  |  03/13/08

GPS Manufacturer Garmin Surges in Latest ChangeWave Survey

Lately, there's been some skepticism on whether Garmin (GRMN) is ever again going to enjoy monster growth. The world's number one GPS manufacturer has seen its stock price tumble 60% in the last four months, and is currently still in freefall. So what gives? Has the Street given up on one of its former high flyers? They've certainly got an excuse. Not only did Garmin's average unit selling price drop precipitously last quarter, but their CFO recently predicted it will... continue

by The Freshman  |  03/13/08  |  Stocks: GRMN,

Cepheid (CPHD): A False Hit Based on a False Claim

Before you read this post, please know that I do not own this stock, although I do recommend it in my service. I'm exposing this because it's a hatchet job done on a product category that can save tens-of-thousands of lives -- and because a company's stock took a hit for no reason. That company, Cepheid (CPHD), took a major hit yesterday after the close, due to an article in the Journal of the American Medical Association -- an article... continue

by Hillary Mark  |  03/13/08  |  Stocks: CPHD,

Google: More Questions than Answers

When I Google "GOOG" in my stockpicking brain, the result is a list of questions. 1) Why buy a "slowing growth" stock in a market that is punishing slowing growth stocks? 2) How can I trust the analysts (and their estimates) on GOOG? Price targets, according to Yahoo! Finance, range from $590 to $900. Why not $400? Why not $1000? 3) Is GOOG too big? Can GOOG monetize YouTube? The space program? 4) Why buy a stock that, as Dennis... continue

by Hillary Mark  |  03/10/08  |  Stocks: GOOG,

Running on MT (ArcelorMittal)

Rather than chime in on the QOTW this week, I thought I'd pull a thread highlighted in Uncle John's Cabin. John reminded us to look at the companies that are suppliers to the big name trend stocks, his pick was a supplier to the mining industry, Bucyrus. Bucyrus and Joy Global are busy building heavy mining equipment. China is reported to be building a power plant every week. Single hull oil tankers are being phased out and shipyard order books... continue

by Hillary Mark  |  03/10/08  |  Stocks: MT,

Sirius Satellite Radio - launching money into orbit

SIRI just issued an annual report, so there's some fairly current financial data - and it doesn't look promising to me. The balance sheet is, um, ugly. Long-term debt stands at about $1.3 billion. That's a lot of interest headwind to fight when you're trying to make it to profitability. For 2007, the loss from operations was $513 million and net loss was $565 million. Book value is negative. Current liabilities are about $1 billion, current assets are about $680... continue

by Hillary Mark  |  03/10/08

Running out of food? You're smoking POT, MON

Jon Markman, in his article Could We Really Run Out of Food, lays out a case for the possibility of a global food shortage due to increased demand, possible crop failures, the feeding of animals, weather in Australia, La Nina, and the production of ethanol. I really like reading Jon Markman, and I really hate to disagree with him, but on this one I think he is dead wrong. Markman says, "The very idea that the modern world could run... continue

by Hillary Mark  |  03/07/08  |  Stocks: MON, POT,

What a Bunch of Yahoos!

I just read that Yahoo! is once again taunting Microsoft by extending the deadline to nominate board directors in hopes of a white knight to save them from a horribly "undervalued" takeover bid. Who might this white knight be? Time Warner/AOL? I certainly doubt it. Google? Umm, can we spell anti-trust? What I want to know is what Jerry Yang is smoking. When Microsoft made it's $31 per share or 41.7 billion dollar buyout bid, Yahoo! was trading at about... continue

by Hillary Mark  |  03/07/08  |  Stocks: MSFT, YHOO,

Beyond Take-Two and Electronic Arts: Video game stock roundup

As an investor in video game stocks, I'm beginning to worry that consolidation will remove pure-play opportunities for trading in my favorite sector. Activision (ATVI) got bought (sort of) by Vivendi, and now Take-Two (TTWO) is probably going the way of Electronic Arts (ERTS). The TTWO buyout is not all that surprising--I first speculated ERTS would take them over back in December on my personal blog. Lucky guess, even an amateur surfer catches a wave now and then. But the... continue

by Hillary Mark  |  03/03/08

Computer Sciences Corp (CSC): Cost reductions and share buybacks add up to a buy

Cost reductions and share buybacks should generate higher EPS. Computer Sciences Corp (CSC) is a large IT service provider. At 43.45, it currently trades at a P/E of 12.6, well below both the industry average (20.5) and its own 5 year average (21.1). I have followed it for several years - it was in S&P's Platinum Portfolio and I decided to track it due to the indications of good quality. They have been restructuring over the past year or more,... continue

by Hillary Mark  |  03/03/08

Avoid Sirius Satellite Radio

I would avoid SIRI because I am unable to project a time when it will be profitable as a stand-alone entity. I took the past 5 quarters of income statements, put them into a spreadsheet, and used Excel's Forecast Function to fill in the next three quarters. The company never shows a profit, and losses continue more or less at the same level as Q4 2007. The primary driver is a slowdown in Subscriber Revenue growth, quarter to quarter, which... continue

by Hillary Mark  |  02/29/08  |  Stocks: siri,

Why Oil Remains Stubbornly High

An explosion and fire at a Texas refinery was largely responsible for driving the futures price on light, sweet crude oil to over $100 per barrel two consecutive days last week. The Big Springs refinery, 290 miles west of Dallas, has the capacity to process 70,000 barrels of crude oil per day, but was completely shut down. It is expected to resume partial operations within two months, but frankly, this is a very small refinery. This panic shows that oil... continue

by Hillary Mark  |  02/29/08

Go Deep for Profits - Transocean (RIG) Earnings Review

Transocean (RIG) reported 4th quarter 2007 earnings on Feb 20th. This was the first earnings report since they completed a merger with former competitor Global SantaFe. For those not familiar with RIG, they are the largest offshore drilling company in the world. They own and operate drill rigs and drill ships that work under contract to oil companies. This is a very capital-intensive business, during the conference call questions, RIG executives estimated a new rig ordered today would be nearly... continue

by Hillary Mark  |  02/29/08  |  Stocks: RIG,

Stocks that go up when inflation rises

Today's trend seems to be a pickup in inflation. A quick way to make a few dollars is to invest in commodity related stocks in energy, materials, precious metals and agriculture. As the dollar drops and inflation increases these investments rise. This strategy will work wonderfully until the Fed begins raising rates. Since that won't be for awhile, lets look at some possible movers in the commodity related areas. Afraid to go all out on one stock and want some... continue

by Hillary Mark  |  02/27/08

Time to sell Imperial Sugar (IPSU)

I have entered orders to sell my positions in Imperial Sugar (IPSU) due to the recent explosion at their plant in Atlanta, Georgia. This was my favorite stock as outlined in my previous blog. I read an article which indicated that Imperial obtained this plant in 1997 when they acquired another company (I believe it was named Dixie Sugar). The article said that acquiring this company enabled Imperial Sugar to almost double their revenue. I was not sure how many... continue

by Hillary Mark  |  02/27/08  |  Stocks: IPSU,

ULTA -- the "ultimate" recession-proof stock

So, I get this semi-threatening letter from the SLO "powers that be" informing me that I need to blog to participate. Alright, 'ere goes. I'm 22, female, graduated college last May, started my first "Real" job in city planning in October. I am in no way qualified to give financial advice. I base my picks on market news, gut instinct, and observations from my point of view. I think ULTA is hot. It dropped down to about 12:50 last month,... continue

by Hillary Mark  |  02/27/08  |  Stocks: ULTA,

5 Reasons Crocs (CROX) is Still a Buy

Crocs Q4 Profit Surges On Holiday Orders; Reiterates FY08 Forecast - CROX Crocs, Inc. (CROX), a manufacturer of consumer products from specialty resins, on Tuesday said fourth quarter profit jumped 84.1% from last year, with revenues increasing significantly from the previous year period. The company also reiterated its previously issued growth targets for 2008. The Niwot, Colorado-based company said net income for the quarter increased to $38.3 million or $0.45 per share from $20.8 million or $0.26 per share for... continue

by Hillary Mark  |  02/21/08

Ride stock downturns to profits

We have all had a stock that takes a dip. Most of us had ridden a stock down way too far. I wish I could give you a golden rule about when to sell, but, truthfully I can't. I am not sure anybody can. As mentioned before, charts can help with that decision, but ultimately, it should be your faith in the fundamentals of a company as to whether you keep or sell it. And, not every decision you make... continue

by Hillary Mark  |  02/21/08

China's Attempts to Hold Down Inflation

The Capitalist Miracle took a hit the other week as the Chinese government reverted to its pre-market reform era and froze electricity prices after earlier capping coal prices. The recent freak snowstorms in China, where one inch of snow brought many cities to their knees, also caught the utility companies with low coal stocks, in part because mines shut down rather than continue to sell coal at regulated prices. The idea that Beijing can regulate prices in major sectors of... continue

by Hillary Mark  |  02/21/08

Lets Parse a few Sentences from the WSJ on ABK

This morning's WSJ has an article on two of my favorite topics, ABK and gambling. It will be instructive to review a few quotes: "It (the plan to divide Ambac) would pit policyholders and shareholders against both each other and regulators, and rankle investors, some of whom have been wagering through the credit-derivatives market that bond insurers would fail and default on debt." Isn't there an oxymoron here? Investors who wager? Gamblers wager, investors invest. Lets go on: "Any split... continue

by Hillary Mark  |  02/19/08  |  Stocks: ABK,

Is Accuray (ARAY) a Buy?

If enough people ask you a question, you should go out and find the answer. A few days ago I finished giving seminars at the Money Show in Orlando and four people asked me about a company I do not follow or recommend, Accuray (ARAY). After reading some and talking to others, I am still not recommending it in my service but thought you might want to take a look, in part because it was recently crushed when it reduced... continue

by Hillary Mark  |  02/15/08

Why I Added CROX

Everyone has seen them or has kids who have a pair (maybe you have a pair yourself). You know what I'm talking about: those "ugly, faddish clogs" that just seem to keep flying off the shelves with head-scratching ferocity. I'm talking about Crocs (CROX), the boat shoe that became a craze. The company's fundamentals are astounding: Sales growth of 226% over the last 12 months, income growth over 162%!!! While MSN money states their net profit margin is just over... continue

by Hillary Mark  |  02/15/08

It's the Monolines, Stupid!

To paraphrase a quote from a previous presidential race and put it in today's context, "It's the monolines, stupid!". Warren Buffett today announced that he would be willing to take the muni bond liability off the hands on the monoline insurers (MBIA, Ambac etc.) While I watch the pundits argue this on TV, the Dow and all the major indices have spiked based mostly on this single piece of hope. (Disclaimer: I am not a financial wizard and cannot even... continue

by Hillary Mark  |  02/15/08

How I Lost $33,000 in Less Than 30 Seconds--Know Your Limits

Most lessons in life are learned the hard way. As kids, we need to burn our hand on the oven, stick a fork in the electrical outlet, and slip while running on the swimming pool deck to make our parents warnings real. As adults, the same principle applies. Our actions have consequences, and many times we must learn the hard way instead of taking advice. On January 22nd, I learned the hard way about the importance of using limit prices.... continue

by Hillary Mark  |  02/08/08  |  Stocks: FXP, RXD,

Former General Electric CEO Welch Tells MSNBC 'No Recession'

On January 29/08, "There's no recession INTC, CSCO, CSX" was posted on the Blog, with the big guys in TECH saying no recession in Tech, and the CEO of CSX being confident there was no recession in transportation or elsewhere in the economy (Michael Ward said that he did not expect a downturn, and the U.S. Federal Reserve's 75-basis-point interest rate cut should boost the economy). Do others share the same view? Let's take a look: Former General Electric CEO... continue

by Hillary Mark  |  02/08/08  |  Stocks: AA, AMGN, CSCO, DOW, GE, INTC, MSFT, YHOO,

The Fed Cuts Interest Rates Another .50%

The Fed cut rates again by 0.50%, bringing the Fed Funds rate (short-term interest rates) down to 3.0%! Here's the official statement: The Federal Open Market Committee decided today to lower its target for the federal funds rate 50 basis points to 3 percent. Financial markets remain under considerable stress, and credit has tightened further for some businesses and households. Moreover, recent information indicates a deepening of the housing contraction as well as some softening in labor markets. The Committee... continue

by Hillary Mark  |  01/31/08

Deep Trouble In China?

The China Miracle looks to be in deep trouble in the stock market, just as I forecast, but I do expect them to rally back with the U.S. market to new highs after the Beijing Summer Olympics. Look at these recent IPO catastrophes: Xinyuan Real Estate (XIN): IPO date was December 11, with the price at $14. As of January 16, the price was at $9.90 -- -29% loss. ChinaEdu (CEDU): IPO date was December 10, with price at $10.... continue

by Hillary Mark  |  01/31/08  |  Stocks: CEDU, GA, NPD, XFMC, XIN,

Let's Start Our Engines

I am all charged up and ready to go for the next round of the Open. My engine is revved and here's what I'm thinking... 1. The market has taken a beating since October and now is the perfect time to go shopping because stocks are on sale. My top two value picks are Cognizant Technology Solutions Corp. (CTSH) and Helix Energy Solutions Group (HLX). 2. A growth stock that has fallen almost 50% (from $43 to $23) since October... continue

by Hillary Mark  |  01/31/08  |  Stocks: BVF, BWLD, CTSH, HLX, KFY, PG, RAIL, UNTD, VPHM,

Apple Core Hits Wall Street

The inherent value of any online investment community lies in the ideas generated by the community. Even more important is the performance of those ideas. We here at InvestorPlace Blogs are proud of the market-beating returns our bloggers have posted over the last few months. The top 25 participants in round one of our stock picking competition, Strategy Lab Open, racked up gains ranging from 14.85% to 49.02% during a time in which the markets were virtually unchanged. Strategy Lab... continue

by Hillary Mark  |  01/23/08  |  Stocks: AAPL,

TCM Continued

Firstly, as I did not participate in the last round, I am already wondering if it's going to be harder strategizing in this market with a 6-month "long-term" outlook or trying to figure how to make my first trade! Hopefully certain things will clear up when the round actually begins. So to continue on, what kind of strategy should one pursue at this juncture. A lot of people are saying that this is a good time to get into the... continue

by Neil DeFalco  |  01/22/08

Bond insurers - why I continue to hold ABK and MBI

Krishna Gullapalli suggested I amplify my reasons to hold these stocks. There is an article from Monday's Barron's (the online version is available today) on MBI, similar to ABK. MBI now trades at 8.xx. The writer from Barron's sees 30-40, and explains his position in more detail and with more clarity then I can do myself. Of great interest is some third party consultant work which Warburg Pincus relied on in agreeing to become involved with MBI. It gets down... continue

by Neil DeFalco  |  01/21/08

Portfolio tweaks

I've done a little tinkering with my sloport since the end of round one. Mostly trading around positions and easing cash into the market - a.k.a. catching falling knives. Good news is I'm beating the S&P, bad news is NAV has dropped below par. I cashed out my Rocky Mountain Chocolate Factory position at a loss, they reported a weak quarter and seem like the kind of discretionary company that will have trouble in a soft economy. The market hammered... continue

by Neil DeFalco  |  01/17/08

Are we there yet?

"If a fellow isn't thankful for what he's got, he isn't likely to be thankful for what he's going to get." Frank A. Clark What a disastrous month has it been so far for investors...One sector after another seem to be collapsing one day, recovering a bit the next day only to set a new low a day later. And I wish there were good news on the horizon...So far I don't see many. Today's MoneyGram collapse was significant for... continue

by Neil DeFalco  |  01/16/08

Weekly Summary 1/11/2008

Trader Talk The short term momentum oscillators remain negative, confirming the bearish stance of the AlphaKing Trading indicator. The accumulation/distribution profile remains in sell-mode, with a slew of higher volume distribution days over the past couple of weeks and zero accumulation days. The leadership profile remains very bearish, with Friday's close yielding 96 stocks making new 52 week highs versus 516 stocks making new 52 week lows. The 4% rule remains negative, while Federal Reserve policy remains positive. The VXO... continue

by Neil DeFalco  |  01/15/08

Hindsight is always 20/20

Its fitting we come to the end of the contest in the heart of the winter season. It is time to reflect. What went right. What went wrong. And what went sideways. Most importantly, I believe it is the lesson learnt from each trade and carried over to the next one, that makes you a better investor or a trader. I would like to hit you with my bullet "isms" that I have learned from this contest and in general... continue

by Neil DeFalco  |  01/10/08

Will the market ever be efficient?

"Confidence is preparation. Everything else is beyond your control" -Richard Kline It is simply amazing to observe how fast human emotions could swing from one direction to another. Several months ago with markets at record high - every "talking head" on TV has been screaming "Buy", analysts predicted that Fed has saved the day with prompt and aggressive rate cuts and even Fed governors themselves projected a significant economic turnaround early in 2008. Now the rhetoric has seem to have... continue

by Neil DeFalco  |  01/10/08

Swap out of bonds into divvy payers?

Thought I'd keep blogging occasionally even tho' SLO-1 has wrapped up. Still haven't decided if I'm going to play in the next round yet Bond yields are starting to look down right anemic. At today's market close, the 2-year yield is 2.76%, the 5-year 3.16% and the 10-year 3.84%. With those yields, I'm considering moving some of my bond fund investment to dividend paying stocks. Three candidates from my SLO-port are Novartis, Unilever and Anheuser Busch. Those three have done... continue

by Neil DeFalco  |  01/08/08

MON vs MON

Great Earnings from Monsanto Monsanto (MON), one of my favorite Blue Chip Growth stocks, just reported amazing earnings. Investor's Business Daily reports: Agricultural giant Monsanto (NYSE:MON) kicked off the year with a running start on Thursday, blowing out first-quarter views amid hefty demand from Latin America. The seeds and herbicides dynamo earned 46 cents a share, up 188% vs. a year earlier and 11 cents ahead of Wall Street forecasts. Sales grew 36% to $2.1 billion, the fastest growth in... continue

by Neil DeFalco  |  01/08/08

Mr. Market is Jonesing

Already the familiar symptoms are beginning to manifest themselves. Any bad news is catastrophic in its potential implications. Occasionally there is an attempt at a rally, which is promptly squashed by a wave of selling. Volume is high, a broad based decline sets in. Puts are at a premium. The VIX is over 20 again. Credit markets will seize up again. Fortunately the patient has an appointment scheduled for January 29-30. The kindly Dr. Bernanke and his colleagues will give... continue

by Neil DeFalco  |  01/08/08

Liars Can Figure And Figures Can Lie

I've been thinking these words since the government took food and energy costs out of the inflation forecast. The beginning of 2008 may present an opportunity for profits in energy, agriculture, and gold, but later in the year may set up one of the biggest buying opportunites for value investors in years. Sell off some of your profitable positions to raise cash in the first quarter so you will be well positioned to take advantage of the upcoming fire sale... continue

by Neil DeFalco  |  01/03/08

Top Ten Secrets Revealed

My simple investment strategy - The Right Mix • To outperform any market you need to adopt a simple decision making process, choose a diversified mix of fast growing companies in promising sectors/geographical regions and right size them as conditions changes. • The right decision making process sees opportunities and risks in rational and simple form, filters noise from valuable information and understands limits of opportunities and extents of risks. • Choosing the right companies is one part of successful... continue

by Neil DeFalco  |  01/03/08

China's Yuan Strengthens, to Fight Inflation

On Thursday, the Chinese government backed up its recent words with actions when it allowed the yuan to appreciate against the U.S. dollar at the fastest pace since China ended its peg to the U.S. dollar in mid-2005. Specifically, the Chinese yuan rose 0.37% to a new high of 7.3175 to the dollar ($0.1367), up 13% from a pegged rate of 8.28 ($0.1208) in 2005. Win Thin, the senior currency strategist at Brown Brothers Harriman, called this "a huge move,"... continue

by Neil DeFalco  |  01/03/08

Left turn Ahead? A Look At Corporate & Consumer GPS Trends

Survey shows Garmin in the lead, but Tom-Tom's putting itself on the map... For a technology that was once relegated to military applications, GPS has certainly come a long way. From tactical to practical, GPS technology is now ubiquitous, with an ever-growing number of applications across a wide range of industries including autos, telecom, aerospace and consumer electronics. To get a sense of where the GPS market is positioned, we conducted two ChangeWave surveys looking at market trends for portable... continue

by Neil DeFalco  |  12/27/07

"Do what you can, with what you have, where you are" T.Roosevelt

We now only have one week left until this first SLO contest is finished and I thought that now might be a great time to look back at the events of the last five months. My portfolio has been fluctuating around the 30-40% return range for a most of the last two months and absent any major events during the next three trading days I should finish the year in the Top 5... All-in-all I am extremely happy with how... continue

by Neil DeFalco  |  12/27/07

Is America "The Next China"

Last Wednesday, Beijing turned the tables on Treasury Secretary Hank Paulson. After enduring years of criticism from Washington on its handling of the Chinese economy and its currency, China's Chen Deming, the incoming Chinese Commerce Minister, said the falling U.S. dollar had pushed up the cost of imported resources and has been a destabilizing factor. Deming stated that "What I'm worrying about is the weakening dollar and its potential impact on global growth." Hmmm. I wonder if the Chinese are... continue

by Neil DeFalco  |  12/19/07

Stocks to Help you Sleep Better

Market madness has erupted and capitulation in all things financial is in the beginning stages. What's an investor to do in all this confusion? Let me share with you some under the radar stocks that may help you through these rough times and give you some income while you're waiting for the market to improve. Also, these stocks are all oil and gas related so they should have earnings as well as upside potential. First off is Buckeye Partners (BPL).... continue

by Neil DeFalco  |  12/19/07

After the Cuts - The Story Isn't Over

A quick postmortem of my analysis before the Fed decision and how am I going to slightly change my strategy after the cut: I had been postulating that the Feds would certainly cut and they may use shock and awe again. The Fed did cut but didn't go with the shock and awe immediately. However, the story is far from over. I had also mentioned that the Fed could induce the shock and awe in a different way this time... continue

by Neil DeFalco  |  12/14/07

Japan Contiunes to Spend Big on Semiconductor Equipment

Japan's economy is rebounding from difficulties in the late nineties and the early 2000s. According to the Economist, the short-term outlook remains favorable, with real GDP growth forecast at 2.3% in 2007 and averaging 2 percent a year over the next several years. Also, electronic manufacturers in Japan continue to innovate and develop technologies that ever increase the functionality of portable electronic devices. On the semiconductor equipment front, Japan has been the spending leader for the last five years. The... continue

by Neil DeFalco  |  12/14/07

The True Moral Hazard

A while ago there were quite a few references to the "Bernanke Put" as a source of moral hazard. The theory was that the belief there would be a bailout encouraged excessive risk taking among investors, lenders, etc. They were protected from the possible negative results of their actions, which created moral hazard. I believe the real moral hazard is created by a financial system which permits the use of insurance-like mechanisms to make leveraged bets in favor of negative... continue

by Neil DeFalco  |  12/10/07

Prudent Investing as I see it...

"When somebody buys a stock it's because they think it's going to go up and the person who sold it to them thinks it's going to go down. Somebody's wrong." If someone actually has read most of my previous posts one thing should have become obvious- I am not afraid to sell my positions quickly if something changes my view about a particular stock or sector but in other cases when I believe market is overreacting I simply stick with... continue

by Neil DeFalco  |  12/10/07

Quantifying Risk/Reward

Investment risk can be quantified - so can reward. It sounds so simple, obviously you just compare the two and the decision makes itself. In practice it involves various assumptions, more of an art than a science but still worth doing. The past few weeks have featured fantastic gyrations by my two largest positions, MBI and ABK, so I decided to quantify the risk/reward for MBI, as a way of keeping my eye on my long term objectives rather than... continue

by Hillary Mark  |  12/06/07

Three Stocks to Buy Under $13

The Dow Jones Industrial Average made news this week when it briefly fell below 13,000. But I'll tell you a little secret Wall Street doesn't want you to know. The Dow has badly underperformed the real stock market. Most people don't realize how bad it's been. The Dow just follows thirty mega-cap stocks and that's not where the best action has been. I'll give you a perfect example. If the Dow had merely kept pace with the S&P 600 Small-Cap... continue

by Hillary Mark  |  11/19/07

No way to Fannie Mae

Buy Fannie Mae??? My initial reaction to Ken's question of the week was very similar to toroandbruin's. But, a quick look at the numbers is in order to see if there might be a good deal here. From Yahoo's profile page, "Fannie Mae provides funds to mortgage lenders through the purchase of mortgage assets, and issues and guarantees mortgage-related securities that facilitate the flow of funds into the mortgage market in the United States." Not the best of businesses to... continue

by Hillary Mark  |  11/19/07

Value Traps and the Eye of the Beholder

The market correction has taken back the small gains that existed in my portfolio and then some. It wasn't a total surprise since the market's intermediate uptrend was broken on October 18 and on October 19 the DOW, NAS, Russell 2000 and S&P 500 all declined by more than 1% on heavy volume. The last time this happened was June 20 but at that time the market recovered within a week and moved to new highs in July. The October... continue

by Hillary Mark  |  11/16/07