Impact of Irish Bailouts

So the markets are reacting favorably to the Irish agreeing to be bailed out. But I believe this will be short lived.

The bailout has not actually occurred yet so there are plenty of “terms” to be worked out but suffice it to say the market “likes” the stability of an agreement.

The Terms of the agreement will be in the form of loans from other countries such as Germany and these terms will most certainly raise rates and in turn force Ireland to raise corporate and income tax rates.

These rate increases will affect companies such as Microsoft (MSFT), Hewlett-Packard (HPQ), Bank of America (BAC), Merrill Lynch, Google (GOOG) and Intel (INTC).

Of course these companies are in Ireland in the first place because of the lower subsidized rates (the lowest in the Euro-Union) that existed before and only helped to fuel the financial and international trade imbalance which existed and contributed to the need for this bail out in the first place.

The companies are not threatening to leave at this stage, but the statement - signed by executives from the four companies - does point out that while Ireland's tax rate may be low in European terms, it is not when compared with Singapore, India and China.

John Herlihy, head of Google's European headquarters in Dublin, said ''anything that impinges on Ireland's competitiveness is going to be a big thing for Google''.
So how did this mess happen? Well in some ways, it is the same greed and deals that ran rampant in the US which has contributed to the Irish demise.

Ireland has three big insolvent banks and several other smaller, equally insolvent financial institutions we won't bother to mention by name.

Ireland also has a large number of subsidiaries of European, British and American Banks. These subsidiaries are often registered as Irish and therefore on Ireland's tab not the nation of the parent bank. This often gets forgotten in the excitement.
Ireland also houses a very large chunk of the world's Special Investment Vehicles (SIV's) which are the shell companies which house trillions and trillions of dollars and Euros and pounds worth of Collateralized Debt Obligations (CDOs).

These are what Warren Buffett described as "weapons of financial mass destruction".
These CDOs, in turn, house an equal or greater nominal value of Credit Default Swaps (CDS) written upon the CDOs.

These subsidiaries were often registered as completely Irish companies. In other countries these same companies faced tighter and stricter policies. So the Irish registered subsidiaries provided a loop hole.

Rumors have it that banks would work the deals outside of Ireland, then send a banker over to Ireland, get them to sit at 'their' desk in Ireland, in the Irish bank, and do the deal there. The legal registration of the deal and the 'oversight' were all Irish. This is known in the financial world as jurisdictional arbitrage. You and I would call it cheating if we were feeling charitable and lying if we weren't.

The deal was properly overseen and approved by the appropriate Irish financial authorities and the profits would be banked at a very happy Irish bank. If any management of the 'deal' was required an Irish company would be hired, there are many, and an Irish manager often living not far from Cork, would 'manage' the money in and out.

Any bad deals, losses and improper oversight is question of wealthy bankers from all countries and the Irish companies, not the people. It should be the bankers who made the losses who should take them.

But as is the case with the US financial and economic woes, it is often the people who pay in the terms of lost jobs, property, income, and higher taxes.

Read more...

The Big Thaw

June was the warmest June in recorded history for Washington DC.

We had 18 days of 90+ degrees
The next three days of July are expected to reach 100.

All this warm weather make me wish we had Snowmagedon again.

Back in the cold old days (December 2009 - March 2010) we had record snow falls and record cold temperatures.

Between November 1, 2009 and May 1, 2010 the DOW rose nearly 15% from about 9700 to over 11,300.

Like the record heat and the memories of all that wonderful snow, all the profits we experienced during this brief recovery have melted away.

The DOW now sits at 9686.

Bye Bye Snow

Bye Bye Profits.








Two months ago I was worried that so much of the market was at 52 week highs and all the bail out and incentives for economic growth were expiring that we were due for a correction.

Now, along with all that, and a record oil spill, folks are talking about a double dip recession.

And I am still worried, not because of the abnormal record highs, but because now so much of the market is either at, or approaching, critical low support levels; that if they do not hold, we will be dipping back into a recessionary pattern.

If some of the stocks on my July watch list pan out, and the support levels hold, we could see a short term rebound. If not, well then the thaw continues and we are indeed in store for a rough ride.

Hmmm, just in case you did not notice, I just said that I was either going to make money or lose money in the stock market... Profound wisdom if I do say so myself...

So, with that said, here is my July watch list with a new, and still evolving format, (I've decided to list the Stock along with a short reason why to buy it and one reason why not to buy it )to help folks decide the pros and cons to investing in any of these ideas.

STARTING LINEUP:

MDF - Metropolitan Health Networks
Why Buy? High inside ownership, Good Cash Flow, profitable, good return on assets, Maintaining valuation in down market.
Why Not? Still within 20% of 52 week high, Uncertainty in Healthcare field and increased risk with all the new regulations.
Reports August 2nd.

NBIX - Neurocrine Biosciences Inc
Why Buy? Still maintaining good money flow and relative strength. recently entered a deal with Abbott, which paid Neurocrine $75 million upfront, with the potential for another $500 million plus royalties still to come.
Why Not? May be cooling off of recent momentum swing and like any pharm company, their pipeline is always a gamble as to whether or not the product ever gets to market.
Reports August 2nd.

CKSW - ClickSoftware Technologies Ltd.
Why Buy? Money flow and Relative Strength are increasing, may be setting up into a reversal (double bottom or W) pattern after falling over 25%. A well run, profitable, not debt company.
Why Not? Pattern may not hold up and needs to be watched. Reasons for drop include economic crisis in Europe which accounts for a large portion of their revenue and two counter intuitive prospectus filings which worried many investors.
Reports July 15th.

CNU - Continucare Corp.
Why Buy? Near low support level of 3.4 – 3.5. No Debt. High inside ownership. Not under federal investigation.
Why Not? Federal investigations into other providers in the industry has driven all stock prices lower and may spook investors. May not bounce off of support levels due to selling pressures.
Reports September 6th.

COF - Capital One Financial Corp.
Why Buy? OK, how many of you said “what’s in your wallet”. Name Recognition. Federal Bail out. May be setting up a “w” pattern with buy in support near 38.
Why Not? Economy, debt and defaults are still a problem. Money flow, relative strength and trend lines are decreasing. The “w” pattern may not pan out and may actually be the signal of a reversal pattern. So this requires a close watch. Goal would to be buy at 38 and sell around 42.
Reports July 22nd.

DD - Du Pont
Why Buy? This is actually a good recovery stock to invest in over the long term – because the recovery will be long and choppy. Pays good dividends. Look for this stock to bounce off of a double support level close to 34.
Why Not? Market uncertainty and “double dip” recession will affect this global company and the 34 support level may not hold. Money flow and strength trending lower.
Reports July 27th.

IDCC - InterDigital, Inc.
Why Buy? wireless technology and patent company expanding overseas market which is one of the larger segments of this line of business. Currently at low support levels.
Why Not? Still under selling pressure with money flow and relative strength weakening.
Reports July 26th.

IPXL - Impax Laboratories Inc
Why Buy? Great generic drug manufacturer and distributor with opportunity to expand generic pipeline and nearing attractive price point between 17 and 18. No debt.
Why Not? Competition, patent infringement law suits, and current eroding of money flow and relative strength make this a gamble.
Reports August 2nd.

RGR - Sturm, Ruger & Company, Inc.
Why Buy? This took off for a 40% run the last time I put it on my watch list in March and has since fallen back off of its peak. Deserves a watch to see what happens price wise between 12 – 14. Recent economic downturn and favorable court ruling make this worth another entry on to the watch list. Profitable and no debt company.
Why Not? Although it is approaching another support point, trend lines have not completely stopped their downward movement off of the high points. The 12 support level is critical and is still more than 10% difference.
Reports July 26th.

SCL - Stepan Company
Why Buy? Well run specialty chemical company making investments world wide to expand capability and efficiency of delivery to a global market.
Why Not? Payoffs to these investments are at least a year away and current economic issues weigh, like other stocks, on the price of this investment opportunity.
Reports July 26th.

BENCH:

CEU - China Education Alliance, Inc.
Why Buy? at critical low support level (triple bottom pattern with not a lot of upward momentum support) - risky play to bet going back up but worth a watch. No debt, high profit margins, and inside investors.
Why Not? The Motley Fool has articles posted galore about this stock.. ;-) . Seriously though, this is an out of favor industry lately and they do face a fair amount of competition over seas.

CMFO - China Marine Food Group Limited
Why Buy? has been falling lately but an uptic in money flow and ownership might indicate the beginnings of an upswing - watch
Why Not? There have been rumors and accusations regarding fraud with this company however the fact of the matter is that many of their actions are concerned with “empire” building and stock price rather than building up tangible value in the company. This may all pan out in the future but for now this is purely a short term bet.

GFRE - Gulf Resources Inc
Why Buy? at a low support level - look to see if it drops closer to 8 - recent article about china investing in oil reserves to help support growing economy - may be time to buy into this. No Debt, high insider investment, high rate of return on capital and assets.
Why Not? In addition to the low support level, the stock has also failed to break top resistance either and this might be a sign of continued weakness.
Reports August 9th.

ABC - AmerisourceBergen Corp
Why Buy? A financial management company in an out of favor industry that has a good dividend yield an good profit margins and is nearing a historical low point. Definitely one worth watching in my book. This falls into my ideal contrarian mold.
Why Not? A fair amount of debt, lower than ideal profit margins and low insider investing.
Reports July 26th.

AMGN - AMGEN INCWhy Buy? A big, I mean really big pharm company at a low support level with a good pipeline of prospects makes this a stock worth putting on the watch list.
Why Not? As with any pharm company, not everything in the pipeline will succeed nor is it immune from competition and patent infringement lawsuits.
Reports July 29th.

BBY - BEST BUY CO INC
Why Buy? If an economic recovery kicks in, this is a great stock to have. It is currently at low support levels and looking as an attractive buy.
Why Not? Well, if nobody gets jobs, then the economy will stall, and people will not buy stuff from Best Buy. Carries a fair amount of debt which could also put it at risk.
Reports September 14th.

CEPH - Cephalon, Inc.
Why Buy? Just like AMGN - good returns, pipeline, expanded research and all time support low
Why Not? It has been mired in lawsuits and patent infringement cases throughout it’s history.
Reports July 27th.

CRVP - Crystal Rock Holdings, Inc.
Why Buy? Well, penny stocks so rarely make my lists that I just had to take a closer look at this one. For a penny stock they have decent numbers and are at the bottom of a well established trading range.
Why Not? I do not see any long term expansion plans, or new marketing plans. Therefore not huge amounts of growth. However, they could be bought out by a large cap competitor but this is the equivalent of winning the lottery.
Reports September 13th.

MSFT - MICROSOFT CORP
Why Buy? The stock is approaching an attractive buy in price and they have recently entered into a new product upgrade cycle with Windows 7, which has good reviews, and Office 2010. Business will upgrade to these new and improved products.
Why Not? Though attractive price it has not reached a support level nor is there any guarantee exactly when business will feel compelled to spend the money on upgrades. This is obviously dependent on the economic recovery.
Reports July 22nd.

SNDK - SanDisk Corp
Why Buy? Approaching good support and buy in price of 40 with anticipated future demand for chips in the Tech market a buy for this stock.
Why Not? Tech stocks are particularly susceptible to market and economic sentiment, especially bad economic news.

Read more...

Challenging Times

Challenge #1:

Well, as usual, I should have followed my own advice and sat out on the sidelines for the past week.

You see, the selling pressure on the stock market was just too much even for some of my good potential setups.

And, guess what, I still am not following my advice... Sort of ...

You see, I pulled out of my positions with KERX and RGR (though I still think RGR is a worthy one to watch). One trend of a bad economy and irrational fear of losing the right to bare arms is that gun and ammo companies tend to do well. In my mind, those two conditions still exist today and can make for continued success in these companies.

The reason I am still invested is that one of the overriding tenants I follow, like Warren Buffet, is to look for good companies at bargain prices. ARO is just that sort of company. After hitting highs earlier this year, (yes I invested on the way up and sold when I reached my goal) , the combination of a natural pull back off of the high point and all the negative economic selling pressure made this stock worth another go around. We will see how correct I am over the next couple of weeks. Between hitting low support levels and a good quarterly report, that combination was worth a 5% jump in price since Thursday.

Challenge #1a:

The economy. Yes all the European financial crisis stuff is not good news. It puts yet another huge strain on the world financial markets and like the US financial crisis last year, the fixes may save us from Armageddon by only delaying the next inevitable challenge of huge debt and inflation.

Unlike the US Financial Crisis, the European crisis helps certain key areas of our economy. It makes the US dollar and investment vehicles attractive. This helps keep our rates down and inflation low and certain key prices (such and gasoline) low. All of this helps the United State counter the negative financial influence of Greece and Europe by making it easier for consumers and investors to naturally stimulate our own economic recovery.

My prediction: Our economic recovery probably has bottomed out and even started recovering but because of the European Crisis, and our very own stock market over-reacting - it never does that now does it… ;-) , (it is up over 60% in the past 12 months from it’s low point last year and still panics sells because of over exuberant traders, programs and lack of stop gaps ) Our “economic recovery” will have it starts and stops and mixed signals for another 12 months. This will only prolong the true recovery and result in both the economy and the stock market experience continued volatility.

Challenge #2:

It’s not fantasy football time yet, but that has not stopped me from thinking about it. So, I have started doing a little research and as always I read some of the “expert” commentary and wonder why?

Here is an example:

Opensports rated the ease of schedule for each position. They gave the Washington Redskins and Donovan McNabb a #1 QB rating based on strength, or lack there of, of schedule.

ARE THEY CRAZY!

IMHO, they offensive line is marginally better than last year and I fear that poor Donovan will be getting all too good a view of the Goodyear Blimp’s underbelly.
This rating is based on passing defensive statistics from last year and does not take into account all the offseason trades, cuts, and draft acquisitions.

And take one look at our schedule and one realizes that it is tough!

They only bright spot in all this is the huge fact that we have Shanahan and Allen firmly in control of the team and together they have restored proper law and order (along with some new creative thinking) back into the team!

Fortunately, with regards to fantasy football, I have plenty of time to over analyze and prepare for the real start of the season later this summer.

Challenge #3:

Lately I have come across a couple different ideas for promoting web sites and new visitors.

The first was a blog hop sponsored by LifewithDogs.tv


It is a blogger type of contest/activity/challenge originally created and hosted by LinkyTools.com .

He did what is called a blog hop which basically gets followers to list and follow other blogs by listing entries. This type of linking can really help generate new visitors, traffic and help with search engine rankings.

The second is something called a Yakezie Challenge.


Basically this gets you entered into an Alexa search engine and Internet content ranking system by generating comments, ratings and links to other Alexa sites. This site uses it’s own browser toolbar to help promote, track and rank sites. You do not have to download or install the toolbar to register your site on Alexa, but it helps. Be aware that this has the same advantages and disadvantages that all toolbars have in the form of tracking cookies.

The third is having various contests or in this case challenges.

This actually ties into the previous two ideas.

I have tired, and failed miserably before with contests – though Sam and Grace probably do not think so – and I am hesitant to try yet again. But as I am a glutton for punishment, here is my idea(s).

Challenge #3a:

A fantasy football challenge. Time for everyone, famous and not, to ante up and prove their luck / knowledge is better than others. I am thinking of setting up a Fumbled Returns Fantasy Football League comprised of all the self and Internet proclaimed experts out there. Of course I would prefer to have true geniuses such as myself and SAM part of this league but it would be really cool to get a truly diverse mix of people to belly up to the challenge.

Challenge #3b:

A Stock Picker Challenge. Perhaps similar to what I do here with a monthly watch list and “recommended” picks type of format. Like the Fantasy Challenge, you do not have to put up money just submit your ideas and picks.

So, what do people think of these challenges? Perhaps between the Linky tools and the Yakezie Challenge, I can get enough people interested to do both.

So, with that in mind, my first step is to find more like minded folks out there who are willing to share ideas and participate in a little friendly competition. I have entered in the Yakezie Challenge AND started a Linkytool feedback form to gather interested parties AND promote fellow blogger web sites.

The true objective of these challenges is not really to prove who is right or wrong or better but to gather ideas regarding both which in the long run will make all of us smarter.

And of course have some fun!

After all, with challenge and change comes opportunity. In this case hopefully an opportunity to have some fun, meet new bloggers, and perhaps learn something along the way.

Just click on the top blogger widget box at the beginning of my blog entries!

Who’s interested?

Read more...

Time for a time out?

I could just take my year to date investment gains and just sit on the side lines.









After all , my goal was something like 24% return, and I have reached that already.









And for anybody else currently in the stock market, pulling out now and holding on to cash may not be a bad idea.

From European Debt crisis, to Gulf Gooo, to Failed fail safes, and circumventing reporting and documentation guidelines, the stock market certainly looks scary right about now.




Unfortunately, the current state of the world economy and the stock market , corporate America, and most everything in general reminds me that everyone seems to to be behaving like a bunch of monkeys. Namely these monkeys.










And that is never a good situation.

But I still have a couple stock ideas that just might pan out so I think I will at least keep my feet in the mix and make sure that I have those stop loss orders in place to protect my investments.

I am currently invested in two companies, volatile Bio Pharm KERX and a weapons company RGR. Both KERX and RGR were setting up for an upswing before the whole bottom of the stock market, and the Greek Debt crisis caught hold of everybodys attention. Since then neither has broken upwards but neither has significantly fallen, yet.

Two stocks which report this week are ARO and CPWM.

ARO is a good strong company that I expect to give a decent quarterly report, however, recent data and retail sales statistics indicate that although the retail sector is no longer going down, it may still have a long way to go before it truly goes back up. CPWM has also weathered the recent turmoil well and could be ready to go back up with a good report.

Of course, this is all dependent on IF the markets don’t panic again and continue the downward trends.

With consumer and investor confidence low, and mixed recession ending data being reported, these are all really big IF’s.

So, stand by for a bumpy ride.

Read more...

Recovery and Speculation...

OK, so I've recovered from insanity, sort of...

At least I've restored my blog theme back to the way it was.

So, in that respect, I've recovered.

However, my April watch lists seem to be quite speculative and perhaps investing in some of this is slightly crazy but here we go with the Fumbled Returns April Watch Lists.

Starting Lineup

QDEL - Quidel Corp
This is one from last years pandemic list and has shown some good strengthening in price lately.
ARQL - ArQule Inc
This is a bio tech company which has turned itself around and is showing promise.
ATSG - Air Transport Services Group Inc
An airline company that seems to be bucking the trend and showing profit.
EMAN - eMagin Corp
I hate 3D. But this company produces diodes and other optic and electronic parts that are necessary for the latest and greatest tech/AV craze. And as a result, its stock has been on a real rocket ride. Best of all, if this craze does take off, there is very little institutional money in this stock. Once they discover it, watch out!
GENT - Gentium SpA
Another Biotech/Pharm company that has posted good profits and expects positive cash flow for 2010; which is always a good thing.
IDSA - Industrial Services of America Inc
Recycled metals. Either an industry on the rebound or companies are targets for acquisitions (a competitor NGA was recently bought out). Either way, speculation wise, these are positive influences for a stock.
MFLX - Multi-Fineline Electronix Inc
This is actually one of my few pattern plays in that MFLX looks like it might be setting up for a breakout from a cup and handle pattern.
ZQK - Quiksilver Inc
A retail distributor that has more than profited from the rebound in the retail market and hopes that the economy has/is starting a recovery.
AAPL - Apple
ipad fever. Thats it.
FDO - Family Dollar
Recovery in the retail market along with continued unemployment and reduced wages are both positives for this retailer.

Bench

LINC - Lincoln Educational Services Corp
A stock that has fallen about 10% from recent 52week highs. Worth watching for a possible continuation of a rebound.
AFAM - Almost Family Inc
A left over from last month which has a good balance sheet and continued interest as a result of the Obamacare legislation.
COCO - Corinthian Colleges Inc.
A good well run educational company which stands to profit so long as folks are willing to return to school for added marketability in this troubled economy.
ENDP - Endo Pharmaceuticals Holdings Inc
Speculation drove this stock up. A less than stellar quarterly report knocked it back down, but, it has bounced off of the low support level and all those speculators look like they are willing to keep this stock afloat.
IDCC - InterDigital Inc
A digital communications company whose stock has truly leveled off. Good news will drive it up. Bad news will pull it back down. I just can't decide which will happen first. Worth a watch but until definitive news, maybe pick one of my other listed stocks.
POZN - POZEN Inc
Another biotech/pharm company with FDA report due by the end of the month. Speculation and a good report will do wonders for this stock.
SNTA - Synta Pharmaceuticals Corp
Another speculative biotech/pharm company which is actually able to come close to profitability.
SNTS - Santarus Inc
Ditto.
ARO - Aeropostale
Wow! not another biotech/pharm company. Rather a well run retailer, with a recent good quarterly report, and a recovering economy. All positive signs.
GME - Game Stop
Between a good bounce off of record low price, speculations of a possible take over and the prospects of a recovering economy; this stock shot up well over 25% last month. Perhaps the hype, like the economic recovery, is not over.

Last month I hit two good quarterly reports (always a risky proposition during reporting season and a possible recession) and got lucky. FDO 12.5% and then ARO 10% netted me a +20% gain for March.

There are some carry overs from last months list(s) such as FDO, ARO, COCO, GME, AFAM; but lots of new speculative additions. Normally I hesitate to have too many eggs in one basket (biotech/pharm) but then again, I am never one to shy away from opportunity.

We shall see how things pan out for April.

Hope everyone had a great and joyous Easter weekend.

Read more...

Setup

OK so now that my Fantasy Football season is over, I can turn more attention to stocks.

Because the chance to play the stock market is never over.

So, how have my December Stocks done so far?



















Well, I have done OK, not great but OK. It looks like I had one really good winner and overall matched up against the indexes just fine.

The DOW is up 1%
The NASDAQ is up 2%


But I did not invest in any of these...



Instead I invested in a pick from last month which remained in my ever watch full eye.
















IAX specializes in absorbent materials and products for the pet industry. Basically Kitty Litter and Beds/Pillows. It is a small company with high insider ownership and low industry ownership and low availability of outstanding shares.

All of this adds up to a bit of a greater risk and, quite frankly it was a bit of a risk to invest in this stock. What attracted me to this stock was the fact that it was small, profitable, at an attractive price, and had an interesting "step" setup pattern.

This setup can have great potential if all the pieces are in play. Such as good relative strength, money flow, and volume. Trouble was this was not 100% true. Look at Mid April, Late May and Mid August stats for Money Flow and Relative Strength. Each time there was a pick up of activity prior to the price jump and maintained during each rise. This time I did not see this pick up, but I did see that the price was maintaining strength above the 50day moving average.

So I took a chance.

As it turned out, I was lucky. IAX agreed to be bought out by Kinderhook Industry which specializes in buyouts and acquisitions of Value Companies and Good Management Teams. This obviously was good news for the stock which shot up nearly 20%.

SOLD!.

So, Which stocks look like they have favorable setups now?

Lets start with the chanciest and end with perhaps the safest.

FLR

















FLR is basically an engineering and construction company which specializes in the energy field. As you can see by the chart, the stock has been falling quite a bit lately. And normally one is wise to listen to the old saying about trying to catch a falling knife...

But... This is actually a well run company with a good pipeline of contracts. I believe much of this fall in price is due to the scary condition of the energy exploration industry overall.

So why do I consider this a setup? Well, for two reasons.

Recently Jim Cramer shouted a Buy! Buy! Buy! on this stock and the Commonwealth of Kentucky issued a draft air permit for Kentucky NewGas, a planned coal-to-natural-gas facility that will take about four years and 1,200 jobs to build.

Rumor has it FLR is/will be a big player in this. And we can add a third reason...
Saudi Arabian Mining Co (Maaden) 1211.SE has received four bids for an $1 billion contract to build an alumina refinery. Guess who is a big part of this bid?

Now for the full discloser. I HATE JIM CRAMER!!!

In fact I would probably do the opposite of anything he says. But...

I love buts conditional clauses...

His Buy Buy Buy shout out seemed to generate a 7% gain in this stock over night. Couple this with the two contract announcements... Coincidence ? Perhaps. But maybe something is about to turn around and maybe there is just enough hype to go along with this increase in contracts to fuel this bounce.

Now for a less risky setup...

AGX

















This diversified company focuses on either acquiring or financing other companies that provide products and services to growth industries.

Currently their subsidiaries include:

Gemma Power Systems LLC (www.gemmapower.com), a leading power plant designer and builder with expertise in engineering, design, procurement and construction.

Southern Maryland Cable, Inc. (www.smcinc.biz) , provides inside premise wiring services to the federal government.

Vitarich Laboratories (www.vitarichlabs.com) is a farm to market, vertically integrated private label manufacturer that manufactures, packages, and distributes premium nutraceutical products, including nutritional and whole food dietary supplements and other personal healthcare products.

AGX stock has recently maintained a good support line at $12.00 and has seen good relative strength and money flow at the same time. As long as it maintains the $12.00 support level, it could provide a good chance to reverse its pattern and start climbing back up the charts.

And Finally...

MSFT

Everybody knows Microsoft.
















Microsoft is currently hitting up against highs either at or near $30.00
If you look at the chart, the stock is well above the 50day moving average, (a good sign) has established a cooling off period after a good run without loosing price, ( another decent sign) and if you look at the pattern, each hit at the top is followed by a dip. Now, what is important here is that each of the low points are higher than the previous. This can often signal what is called a breakout past resistance.

Of course, it could fail in its breakout and go back down to it previous (26 -28) range before moving back up. But with the anticipation of the holiday season and new releases, it may be a safe bet that folks are thinking that good ol' Microsoft stands a chance to make a buck or two and positively reflect this is the price of the stock.

Read more...

For Sale: Heaven and Hell !!!

Yes folks! Yours today! Get em' while they last!

Just in time for the Holidays!

Your Chance, or that of an acquaintance, for a spot in Heaven or Hell!

Reserve today!















Reserve a Spot in Heaven


And while you are at it....

Don't miss out on your chance to send that someone special to the eternal hot seat!!!

Or, perhaps you, yourself, already know your fate and are willing to accept it and actually look forward to sweating it out and drinking shots with all your fellow drug addicts and strippers.













Reserve a Spot in Hell

This has got to be one of the best, silliest and unique new business sites I have seen in quite a while.

Alas, I am not imaginative, nor quite brave enough to venture into this realm of online sales.

But bravo to those who did and boldly went where we have not.

Yet.

PS. I found this from the MSN article "America's Best Home Business Ideas"

Read more...

It's about time

And paying attention.

This month was horrible for stocks. Specifically mine.
I must admit, that I was worried about the market having gone up nearly 60% amid a recession. But according to the Federal Government the recession is over.















Don't all you unemployed folks stand up and cheer at the same time.

Fact is, everything was due for a correction. A cooling off of sorts. And all it took was fear that the recovery was not sustainable, fear that everything is not going back to normal, (see unemployment figures) and that the upcoming retail season will be less than enthusiastic.

In fact, many analysts, were predicting a jobless recovery out of this recession and it looks as though they are right.

Also, not all the mortgage and financial problems that got us into this mess are completely over yet either. I mentioned this earlier this year and also saw this article recently which seemed to highlight my thoughts and this trend.

So what about all this stimulus and bailout money that either saved or created hundreds upon thousands of jobs and saved the auto and finance industries?

Well, the cash for clunkers was very temporary and if our recent experience shopping for newused cars is any indication, the auto industry still has a long way to go. In short, the dealers are desperate to make a sale. What usually takes weeks of me gong back and forth with dealerships negotiating, took only a matter of days to close the deal.

The bailout money to banks and finance institutions kept them from going under and probably saved us from going immediately into a depression. But as we saw in the previous article, there is still a lot of bad dept out there both on the residential side as well as on the commercial side.

And as for the saved jobs, many could be temporary if funding and the economy does not get better.

So, is all doom and gloom? Is it scary?

Hopefully the answers are no and maybe...

Here are the results for October.

















My Starting lineup lost over 10% and my Bench lost more than 6%.
And what is truly amazing is that many of the stocks were up quite a bit half way through the month.

Case in point, CTFO which ended down 22%, was at one point up nearly 30% !
A 50%+ swing in less than one month !!!

Amazing!

So should we all bail out of the stock market and run for the cover of Bank CD's and Bonds?

If you do not like volatility, yes.

If you don't mind it, and are willing to pay attention, you just might be able to profit from the volatility.

Actually, I am in a way glad to see everything come down. At the beginning of last month, I was looking at the stocks in my watch lists and the market overall and saw A LOT of peeking chart patterns and stocks hitting 52 week highs. I figured it was time for a correction and this makes stock picking more difficult.

Guess I did not pay enough attention and heed my own advice...

This falls into my "I hate it when I'm right" category.

So, where does this leave us, and me, for stocks in November?

Well, here is my November Watch list(s).






















For this month, I looked for stocks which past my screens and were either positioned for a recovery, near support levels, and or well run and well diversified to take advantage of areas of a strengthening economy even though not all parts seem to be recovering at the same pace.

Starting lineup:

UEPS Net 1 Ueps Technologies Inc
This is one that was on earlier watch lists and has a good business model which works well in any financial condition. It has recently dropped from recent highs, nearing a support range and is once again worth watching.

GME GameStop Corp
Another one from earlier this year. Even though Retail is expected to be down, this stock was hit by recent sell off and is well positioned to capitalize on the holiday / and post holiday season.

CNU Continucare Corp
Approaching critical support level - watch to see if it holds or looses support.

NTES Netease.com Inc
Time to buy back in. Recently seems to have bounced off of a good support low. They report earnings on the 18th.

IAX International Absorbents Inc
Pets supplies and bedding - Has maintained good results even in recession -recent good qrtly report. One thing I have learned over the years, people love their pets and they often spend the money to make them comfortable and healthy.

FCFS First Cash Financial Services Inc
Financially strong company with a recently good earnings report. It is currently in a dip hitting support levels.

GHM Graham Corp
Good well run company up over 30% for year - good pipeline - reports and recently pulled back to a more attractive potential buy in level.

ENSG Ensign Group Inc
Good play on aging population and seems to have weathered the recession better than some of its competition. Company reports earnings Tuesday.

OFI Overhill Farms Inc
Recent 52 week highs with an even more recent 10- 12 % pull back nearing support levels. Deserves a watch.

BKE Buckle Inc
Recent pull back to support levels with earnings release set for the 19th. Worth a watch even with uncertainty in retail sector.

BENCH:

HOGS Zhongpin Inc
Do not like pattern - could be head and shoulders pattern. But I love the name. ;-)
Seriously, a bit of a risky play but there is always a chance it will maintain support levels but deserves caution.

BBND BigBand Networks Inc
Risky but in a good sector for growth. This company just might be potentially good take over position wait until after earnings report on the 9th.

SYNT Syntel Inc
Recently fell past support at 38 next level at 30. May still fall more. But if it holds, look for a good rebound.

CFSG China Fire & Security Group Inc
A good china play that requires attention to timing.

NVO Novo-Nordisk A/S ADR
Hit Support Level and is a good play on the risky Pharma sector.

GRMN Garmin Ltd
I am not convinced that, even hitting support, this company will please analysts enough over the holidays for a stock price recovery. But, I've been wrong before and the screens seem to think it is a possible candidate for upward movement. But they've been wrong before too...

CHNG China Natural Gas Inc
Leveling off after slight pull back and reports on the 9th.

CTFO China TransInfo Technology Corp
This is the big swing stock I mentioned earlier. So, why do I keep it on a watch list? Well, Support levels were at 9 , 8 , 7, 6 (with 6 being the critical one. Peak / Drop (Triangle) pattern has been exaggerated by recent scare. May be ready for a bounce and or recovery. But be careful. It could still go lower to the critical 6 support level.

POWL Powell Industries Inc
Good sound company bouncing off of 52 week highs. Look to buy on bigger dips in price.

ISSC Innovative Solutions and Support Inc
Has been recently awarded contracts and appears to be on the move. Though I am not seeing clear buy signs at the moment (pattern wise) so I have it here on my bench watch list.

Read more...

A Recovery?

Lets look at the evidence..and expectations!

Wall Street:
- DOW up nearly 20% since recent lows but still down 5% for the year.
- NASDAQ up 13% for the year.

Many recent company reports have been bad but not as bad as feared or expected.

Unemployment Rate:
- 9.6% and still rising.

Most recent report was significantly higher than expected.

Home Sales and Construction:
-As of May, sales of existing homes nationwide were up two straight months while pending home sales were up four months in a row.
- Inventory of homes is still close to highs of 11 months.
- Nationwide, home prices dropped by 16.8 percent in May as foreclosures continued to home values down.
- Construction spending saw a bigger-than-expected drop in May, down 0.9 percent according the Commerce Department report released this month.
Overall, the sector has only seen one positive period in the last eight months.
- The International Council of Shopping Centers said 6,913 retail stores -- of all types -- announced closures last year (2008), compared with 4,603 in 2007… And the numbers continue to grow…

Consumer Confidence:
- One report, the University of Michigan’s confidence index, reached its highest level since February 2008.
- The Conference Board confidence index, meanwhile, dropped during the same period.
- While consumer spending rose in May, the national savings rate also hit a 15-year high during the same period, according to the Commerce Department.

The mixed results likely reflect a more positive yet cautious outlook among consumers.

Stimulus vs. Inflation vs Interest Rates:
- Stimulus packages have given the appearance of stabilizing the financial sector.
- All this extra money has yet to increase inflation or interest rates, yet.

So, What is my take on all this?


Expectations have been set:
- The administration has set the expectation that the economy will get better but some things may get worse before we are out of the woods. Basically they have set the bar low so that they can generate positive expectations and HOPE.

To quote Martha Stewart... "this is a good thing"

The Stock Market:
- The financial sector is, at least temporarily, stabilized.
- Hopefully business reports, although down, will continue to be "not as bad" as expected.
- Companies are continuing to shrink both in number of offices, stores but also in employees.
- This helps boost returns by cutting costs and getting rid of negative revenue.
- Overall, the stock market likes this - believe it or not.

So, overall for the short term, I see stocks continuing to rise.

... "this is a good thing"

But expect things to be volatile!

As we all have seen; any negative news; such as a worse than expected unemployment rate, will drive the overall market down.

But there is opportunity to make money based on this volatility.

... "this is a good thing"

However...

For the Long Term:

- Inflation will be critical!
- Interest rates will be critical!
- Basic Supply and Demand principles will be crucial!

Until the unemployment rate at least levels off and more importantly goes back down, true recovery will not occur.

People need jobs to generate income.
Income is needed to spend money on buying things.
Things from: Houses, to groceries, to discretionary items.
The more people spend vs save the more stores will increase sales and distribution.
Until that happens, storefronts will not recover.
Until storefronts recover, construction will not increase.
Until home prices stop falling, it will not matter how good rates will be because people will not have the money to spend on home purchases.
Until construction (demand) increases, jobs will not increase.

So, here is to hope and expectations for continued progress in getting out of these troubled times.
It will not be easy,
It will not be over a short period of time,
nor will it be, as some people (generations) seem to have recently developed expectations, "entitled" to get better or go back up,
But rather, we will all have to work for it!

Read more...