Published April 29th, 2007
in Portfolio - Updates (all).
The DOW breaks 13,000 and the bubbleheads are already talking about 14,000. If the 13,000 was adjusted for inflation - we would still be below the highs from 2000, but that doesn’t make for a good news story. The mantra on Wall Street is typically sell in May go away. However, this year everyone is afraid of missing the run. It will be interesting to see how this plays out.
On the commodities front, Precious and Base Metals lagged: Gold -2.0%, Silver -2.7% and Copper -2.4% for the week. Oil found the plus side +3.6% for the week.
So, how did the portfolios perform? Continue reading ‘Week in Review 4/27 - DOW Breaks 13,000′
This thread tracks real trades in one of my portfolios. Refer to backgrounder for more info.
Another week of under performing the averages. It’s kind of difficult to keep up, while sitting on 40% cash. Hopefully, I will get a couple of buy set-ups this week. Let’s take a look at what happened this past week.
Continue reading ‘Real Money Portfolio - Update 4/28′
Published April 28th, 2007
in Investing - General and Economics.
In spite of all of the big hoopla, the DOW simply isn’t what it used to be.
Source: Peter Schiff
Despite its recent eclipse of 13,000 the Dow now buys 30% fewer euros than it did then back in 2000 when it was priced at approximately 11,500. It also buys 35% fewer gallons of milk, 40% fewer bushels of corn or wheat, 65% fewer ounces of silver, 70% fewer barrels of oil, 80% fewer pounds of copper, and 90% fewer pounds of uranium. Try figuring what the Dow will buy in terms of other necessities, such as housing, insurance, college tuition or hospitalization. Any way you measure it, the Dow is worth far less today then it was in January of 2000.
The point to remember is that when it comes to records, it is real purchasing power, not nominal value, that counts. Measured by its purchasing power, the Dow has clearly lost value over the past seven years. Those who have remained invested in Dow stocks during that time period are clearly poorer as a result. Those who continue doing so will likely loss even more wealth in the years ahead, regardless of how many more nominal record highs the Dow sets.
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Published April 26th, 2007
in Personal Finance 101 and Women and Money.
Articles written specifically for women on money issues most often include lessons for men as well. I found the following table quite interesting and alarming.
This quote follows the table:
“You’ll notice there aren’t any contribution suggestions for you 45-year-olds if you don’t have at least 3 times your income saved. That’s because T. Rowe doesn’t think you have much of a chance of making your goal.”
If you find yourself light on savings and short on time start preparing yourself to work past 65, but most importantly - if you have kids take this table and plaster it on their foreheads!
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I am sure many were concerned on April 19th as it appeared that the markets were in for a repeat of the China led melt-down on February 27. The Chinese Stock Market’s negative take on the countries 11.1% first quarter growth rate spilled over to Europe and cast a black cloud over the U.S. Markets as it opened. The surge in growth rate coupled with a higher than acceptable consumer price index and a 23.7% growth in fixed-asset investment prompted statements such as the following from the government:
“If this type of fast growth continues, there is the possibility of shifting from fast growth to overheating. There is that risk,” Li Xiaochao, spokesman for the National Bureau of Statistics, told a news conference.
The government will work to “reduce the country’s large trade surplus, limit rapid growth in house prices and maintain basic price stability” – was posted on the State council’s Web site following a meeting chaired by Premier Wen Jiabao
Continue reading ‘Is China Too Hot?’
Published April 24th, 2007
in Economics and Investing - Energy.
I paid 55 bucks to fill up my car this weekend. That’s only going to cover 3/4 of a tank soon. Looks like it is time to bulk up on Oil Company stocks. That will more than cover the increased gas expenses.
April 23 (Bloomberg) — Whether it’s $50 to fill up your Prius or $130 for the Ford Expedition, $4-a-gallon gasoline is coming to a pump near you.
Fuel prices are rising at a pace not seen since Hurricanes Katrina and Rita knocked out a third of the U.S. oil refining industry in 2005. Gasoline consumption is climbing twice as fast as last year and will accelerate when summer travel begins late next month.
“What we’re surprised by is the increased demand,” said James Mulva, chief executive officer at ConocoPhillips, whose refineries from California to New Jersey produce 56 million gallons of gas a day, enough to meet 14 percent of the country’s needs. “Even though the price of gasoline is up, the demand is up,” he said in an April 12 interview in Houston.
Continue reading ‘Gasoline at $4 Coming to a Pump Near You, Unfazed by Rising Tab’
Published April 22nd, 2007
in Portfolio - Updates (all).
China Melt-Down II couldn’t stop the DOW from making record closing highs on Wednesday, Thursday and Friday. Thursday had feelings of deja vu when China’s market fell 4% on concerns of an overheating economy. This carried over to the U.S. markets in early trading, but by the close the DOW managed its way back to positive territory. By Friday, traders determined that growth is good and pushed the DOW up 146 points. The DOW, S&P 500 and NASADAQ for the week closed up 2.8%, 2.3% and 1.4% respectively.
The commodities were a mixed bag. One would think a booming economy would increased demands for energy. That’s not how the market interpreted China’s 11.1% Q1 growth rate. Oil was down 3.3% for the week, but King Copper continued its roll closing up 2.4%. Gold and Silver moved in opposite directions. Gold was up 0.9% and Silver was down 0.9% for the week.
So, how did the portfolios perform? Continue reading ‘Week in Review 4/20 - DOW Makes Record High’
This thread tracks real trades in one of my portfolios. Refer to backgrounder for more info.
Volatility ruled the week as growth in China was bad one day, but not so bad the next. Unfortunately that whip-sawed us out of a couple of positions and has the portfolio trailing the S&P 500 again. Let’s take a look at what happened.
Continue reading ‘Real Money Portfolio - Update 4/21′
Published April 21st, 2007
in Entrepreneurship and Young Investors.
What were you doing when you were 15 years old? Jasmine was discussing her million dollar business on Oprah.
Source: Financial Times
Two years ago, nearly all Jasmine Lawrence’s hair fell out after a chemical perm went horribly wrong. Today, partly because of that accident, she is at the helm of a haircare products group whose sales could top $1m this year.
Not a bad achievement for someone who cannot yet drive, drink alcohol or sign most legal documents: Ms Lawrence, the founder and chief executive of Eden Body Works, is 15 years old.
At the age of 15, she has already learned the difference between a life of financial independence and one tied to a 9 to 5. A 9 to 5′er would have filed a lawsuit - she saw an opportunity.
Read about her days leading up to the Oprah show here….
Published April 20th, 2007
in Investing - General.
Caterpillar, a member of the Big Build-Out (BBO) portfolio, reported better-than-expected quarterly earnings today. What’s exciting about the report is how they exceeded expectations. The company raised its outlook, saying “exceptional growth” outside North America was offsetting weakness in the U.S. residential housing and on-highway engine markets. Whatever happened to the saying “when the U.S. sneezes the rest of the world catches a cold.”
The key to making money in this market is to look for companies that have international reach - which is the objective of the BBO. The following quote says it all.
Eli Lustgarten, an analyst at Longbow Research, said while Caterpillar’s results were lifted by an asset sale that contributed as much as 5 cents to earnings per share, “It’s a bigger quarter than we expected.”
He said the results showed while North American trucks and housing are “material markets,” they’re “not all that important because Caterpillar is so international and so diversified.”
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