Investors 411 Blog

by Barr Jozwicki
November 10, 2009

Market Updates – Making YOU money

Author: Barr Jozwicki - Categories: Market Update - Tags: , , , , , , , , , , ,

Making YOU money

$$$$$$$

Mega Trends, Investments. Fundamentals, Technicals, Economic and Politics all interact. Checkout OVERVIEW LINK section of blog. You can agree or disagree with the politics, but you can’t argue with the results.

  • FXI -our #1 position up over 50% this year
  • EWZ – our #2 position up over 100% this year
  • GLD – our #3 position – up over 20% this year
  • 5 year record of beating the benchmark S&P 500
  • See position section of blog below


American’s Just Don’t Get it

From Huffington Post – Fall of Berlin Wall

I don’t know if its ego, religious zeal, stupidity, greed or whatever.  We are totally out of step with the rest of the world on lots of major issues. One issue is especially relevant – 20 years after the fall of the Berlin Wall where supposedly Capitalism triumphed -

The BBC asked – Is Capitalism Working? Here’s the results from from 29,000 people in  27 countries – LINK

  • 11% yes capitalism is working well.
  • majority believe capitalism needs more regulation and reform – obviously not many members of the US congress seem to agree/
  • 23% believe it is fatally flawed.

YOUR Comments

Checkout recent posts by Sherwehe, Bob Sadinski (always passionate), & D .  Sherwehe has an excellent follow up to what’s happening to our financial system. LINK

D worries “are our investments safe.” Short answer is always NO. Nothing is absolute. Israel could nuke Iran tomorrow. But the mega trends continue

Right now, in the short term, its starting to be is a better time to take profits than add to positions.

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index Percentage % Volume
Dow +2.03% up
NASDQ +1.97% up
S&P500 +2.22% up
Russell2000 +2.06%
-

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

  • Brown = repeat statements
  • Green = usually bullish statements
  • Red = Usually bearish statements

Technicals, Fundamentals & Analysis

Another major rally in weak anemic volume

McClellan Indicator LINK Investors411 is going to include this forecasting tool far more often. There are other indicators that tell if a market is overbought or oversold, but this one is easy to understand and is really working well right now.

Key to chart – 0 is neutral and when you get to @ +60 you are overbought and approaching-60 you are oversold)( buy at oversold and sell at overbought) We are going to use this chart a lot more. Yesterday the index moved from @-10 to +20

As stated many times before The new #1 forecasting tool is what happens to the dollar.= Yesterday the dollar dropped was huge so the stock market rally

FEARLESS FORECAST FOR WEEK It looks like we are in rally mode . The dollar rules and yesterday it fell to its major support level. Usually a major support level at least temporarily halts any fall. However, last week India spooked the entire investment world by buying $7 billion in gold. This has put added pressure on the dollar that basically crashed yesterday. Best guess – we hang on for a while but dollar falls and stocks rise.

——–

Significant forecasting tools/Indexes for stock markets

(Besides #1 Volume & #2 Reaction to News)

BDI The Baltic Dry Index measures the flow of goods by price (world trade) .

The BDI is @ 18% off its high (early June) Before that it gained almost over + 630% from its all time low of 663 in Dec. of 2008 (April 2009 high of 4291 )

The BDI rose a significant +87 points yesterday and closed at 3480. We look to be starting another major move higher. A higher high price on its chart pattern has been confirmed The BDI has rallied almost 1400 points since late September. =  Bullish for stocks & world trade right now. Especially good for our positions in FXI & EWZ

——-

The Dollar is currently the #1 forecasting tool .

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

Mantra Dollar up = US stocks down & Dollar down = US stocks up

US dollar dropped a HUGE -0.92% yesterday. The dollar closed at $75.06 .  This is directly above its, line in the sand, support level.

From last week – The next important resistance level for the dollar is the falling 50 day moving average (blue line on chart). This is at $76.45 this AM . The support level is a t @$75.00 Both are important lines in the sand. A breakout on either side will move US equities in the other direction and the world will follow.

Positions

The  Positions Section (top of blog) to see all the latest buys and sells

Sorry have not had a chance to update this in over a week .

Investors

FXI – China – (now 25% of portfolio) At new high – up over 50+% this year

EWZ- Brazil (now 20% of portfolio) At new high – up over 100+% this year

GLD (now 11% of portfolio) At new high – up over 20+% this year

Comments – All major positions have beaten the benchmark S&P 500 . With all our major positions.  This is clearly NOT the time to add to these positions.  Investors 411 buys the dips. Short term investors could even take some profits.

Going to add Indonesia & Vietnam ETF’s – but waiting for dips. Also going to add DGP (this ETF does about 2x what the GLD does) – More explanation later.

SPX – Sold entire 20% position for 1085 (this was done to free up cash for other investments and take profits)

Traders (short term plays) These are no t ETFs, but individual stocks

Extra Note of Caution here – Even though I always warn you AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING! please note I’m far less confident in individual stock picks

NVS – (5% of portfolio)  We’ve already sold 1/2 of this. Now up 15+% since bought

CSCO – (5% of portfolio) Flat since we bought position a few weeks ago.

AMZN – (10% of portfolio) Bought last Wednesday – Got lucky and this stock has risen 9% in less than a week. Going to sell 1/2 (hopefully into a rally today) and let the rest ride.

Long Term Outlook – The dolar looks like it may bred down through major support and the benchmark S&P 500 is on the verge of a yearly high – Outlook will change to CAUTIOUSLY BULLISH when this happens.

Long Term Outlook = NEUTRAL

See Changes in STRATEGY, POSITIONS, & OVERVIEW sections of blog

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

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October 26, 2009

Market Update – Tom Friedman’s Dream or Nightmare

Author: Barr Jozwicki - Categories: Market Update - Tags: , , , , , , , ,

Tom Friedman’s Dream/Nightmare

Sunday TF wrote an editorial LINK that opened with imagining President Obama in 2012 standing in Iraq under a banner “Mission Actually Accomplished .”

This is the dream of anyone who wants to build a 20th century colonial empire.  The person who should be standing ALONE under any banner in Iraq in 2012 or any future date is an Iraqi President.

  • Britain got out of India – It wasn’t pretty but the end result is the world’s largest democracy in India and a fragile democracy in Pakistan.
  • The US got out of Vietnam – Again it wasn’t pretty, but now Vietnam has one of the world’s fastest growing economies and even its own ETF – VNM . Like China there is one party rule, but millions are coming out of poverty into a growing middle class.

Our efforts to colonize the Muslim world have made the overall situation worse, cost trillions in dollars and who knows how many lives. Let the nightmare of colonialism go .  If there is a clear and present danger – act. Now we are on the verge of nation building in Afghanistan whose #1 economic product is opium not oil. It’s long past time for a change to a new strategy.

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index Percentage % Volume
Dow +1.08% up
NASDQ +0.50% up
S&P500 +1.22% down
Russell2000 +2.04%
-

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

  • Brown = repeat statements
  • Green = usually bullish statements
  • Red = Usually bearish statements

Technicals, Fundamentals & Analysis


Reading the Tea Leaves BE CAUTIOUS volume has in no way confirmed the move higher. If you look at the beginning of the bull run (March April and May)(check out weekly charts of a major US index) there was huge volume behind the move higher. You expect some slower volume in the summer, but volume has not returned to the markets. In fact there has been significantly more volume on downside days than upside days this month.  Our #1 confirmation factor of price moves is calling for – bears to rule

The Dollar (see below) The slow/moderate fall of the dollar is a trader’s dream . One danger for a fall in the dollar is the rise in oil prices. $100 dollar oil would negatively impact stocks.  As long as the dollar falls it holds up stocks. – Bullish for stocks

Bottom Line – Still CAUTIOUSLY BULLISH Long Term Outlook (see below) The dollar trend is the trump card that is firmly in place. Every big volume decline is trumped by the falling dollar that pushes US equities higher. The second major reason is the stimulus packages in emerging markets like China, India and Brazil have worked. China, especially, never entered recession and the growing middle classes here has led the world equities higher.

The drag is concentrated in the USA. Why – We already had a huge debt, our financial industry still has  huge phony unregulated profits, and we are/will be wasting trillions trying to nation build.

——–

Significant forecasting tools/Indexes for stock markets

(Besides #1 Volume & #2 Reaction to News)

BDI The Baltic Dry Index measures the flow of goods by price (world trade) .

The BDI is @ 30% off its high (early June) Before that it gained almost over + 630% from its all time low of 663 in Dec. of 2008 (April 2009 high of 4291 )

The BDI rose a significant +42 points yesterday and closed at 3043. A higher high price on its chart pattern has been confirmed The BDI has been rising (with one bump) since late September. =  Bullish for stocks & world trade right now

——-

The Dollar is currently the #1 forecasting tool . It would be a wild guess to predict he daily moves of the dollar, but longer term fundamentals are clearly negative – the trend of a falling dollar should continue.

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

Mantra Dollar up = US stocks down & Dollar down = US stocks up

US dollar rose a significant +0.56% The dollar closed at $75.47 . Bullish for stocks

Last year’s low was around $71,(March 08 ) so there is a long way to go before the major and very crucial support level is reached . The dollar does have a support level around $74.00( a high from about a year ago – see long term chart)


Positions

The  Positions Section (top of blog) to see all the latest buys and sells

Trades made this week are updated at the end of the week. -  Sold 50% of position in EWZ and all of EWY. This sure looks like – a big mistake – Should have been adding instead of subtracting – especially EWZ – Still no one ever went broke taking profits. - Sorry – Did not update Positions section.

Outside the USA in Emerging Markets (especially China, & Brazil) are much better in the long run - My problem is one of timing. We can’t get a 5 to 10% dip to invest. Investors 411 should have much larger positions in emerging markets .

For Traders (not long term Investors )

NVS - One of the 2 stocks owned (the other is CSCO). This is a swine flu play. Obama has declared a national swine flu emergency and NVS’s vaccine is not due to be distributed till mid December.  NVS is going to have too little too late. Taking profits today. (You could also sell 50% and put in a stop/sell order)

EWZ – Yes it was a mistake to sell 9% of this. Buying it back.  Will add to both FXI (China) and EWZ this week  A falling dollar is just an additional fundamental reason to own these areas. Other reasons have been listed over and over again.

Traders – Three major tech stocks leading the charge – Hope CSCO joins them when it reports earnings.

  • AAPL – cutting edge computers and telecom revolution (phone’s) moving into China.
  • AMZN – Fabulous earnings report and forecast.
  • GOOG – Internet adds is growing even in USA.


Long Term Outlook = CAUTIOUSLY BULLISH

See Changes in STRATEGY, POSITIONS, & OVERVIEW sections of blog

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

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September 9, 2009

Market Updates – The End of Democracy?

Author: Barr Jozwicki - Categories: Market Update - Tags: , , , , , , , , , , , , ,

The End of Democracy?

E.J. Dionne who writes primarily for the Washington Post had an editorial entitled It Could Be the End of Democracy as We Know It . LINK

What Dionne is referring to is an upcoming Supreme court decision that threatens to overrule a 1990 decision that upheld the long-standing ban on corporate money in campaigns.

Yes, McCain/Feingold legislation made it much harder for corporate giving and it still got through. However this legislation would open the floodgates.

HAVE WE so quickly forgotten the #1 lesson of the 2008 economic meltdown-that Greenspan as he admitted was wrong and “free markets” could not regulate themselves ? This week US corporations may be given unfettered access to buy politicians. Indeed as Dionne explains “President Barack Obama’s health care speech on Wednesday will be only the second most consequential political moment of the week.”

Quantum Shift in Savings

Another unheralded event is not making headlines. That the quantum shift of Americans from net borrowers to savers . Since Reagan took office and reversed the trend of diminishing national deficits (see last Thursday’s blog for data on deficits as part of GDP) The shop till you drop,go into debt up to your eyeballs era is coming to a close for the American consumer.  MSNBC reports that in July “Americans cut debt by $21.6 billion in July; $4 billion was expected” LINK

Some conclusions from this data:

  • How is there a quick economic recovery if American’s save more?
  • Saving more is obviously a good thing and increasing debt bad.
  • Real Organic growth is going to come from outside the USA (countries like China who were huge net savers and are saving a little less now)

Financial flows like this reinforce the concept that in the USA any recovery in GDP is going to be slow to materialize and real organic growth is going to be led by emerging markets whose middle classes are growing and don’t have huge deficits.  Even countries like Germany who have been net savers and whose businesses do not worry about paying health care costs are at a distinct advantage over the USA.

This is why Investors411 focuses on foreign ETFs that have organic growth and growing economies/middle classes – Invest in where the money is and will be flowing

STOCKS

AS ALWAYS, DO YOUR OWN RESEARCH BEFORE INVESTING!

Index Percentage % Volume
Dow +0.59% up
NASDQ +0.94% up
S&P500 +0.88% up
Russell2000 +1.03% -

Investors411 record – 4 1/2 years of beating benchmark S&P 500

(see results for last 1/2 year – click  6/25 & scroll down)

  • Brown = repeat statements
  • Green = usually bullish statements
  • Red = Usually bearish statements

Technicals and Fundamentals

Major US indexes rose again.  This time volume rose,but was still below average.  Stocks are rising because the dollar is falling. It took a massive hit yesterday.

This week , FEARLESS FORECAST - is for an up week .

——–

Significant forecasting tools/Indexes for stock markets

(Besides #1 Volume & #2 Reaction to News)

BDI The Baltic Dry Index measures the flow of goods by price (world trade) It looks like we could be forming another lower high and that would reinforce the mid term bearish pattern . The BDI has leveled off and started to rise over the last two weeks, +33 yesterday.

Each day this looks more like a base has been formed above a key support level – Bullish short term outlook for BDI and we have certainly recovered from the devastating lows of Dec./Jan.

The BDI is 41% off its high (early June) Before that it gained almost +170% from early April to Jun e

——-

$USD - Check out the 6 month chart (to the left) or a multi year chart of the US dollar of the US dollar.

The dollar dropped of the table and through its major support level. It fell a whopping-1.16% % yesterday. Dollar closed at $77.26. Its  major support level is @$77.5 . Short term Bullish for stocks

Mantra Dollar up = US stocks down & Dollar down = US stocks up

Bottom Line – Both the BDI & the Dollar are forecasting at least a short term rally. Key to look for is can the dollar get back over its $77.5 support level.


Positions

The whole Positions Section has been revised (Click on “Positions” at top of blog). Check it out

Sold 1/3 (or 6% total stock) position in FXI (China) last week A Mistake . With both the dollar falling and the BDI finding technical support and rising China again looks like the place to be invested in. Investors411 has only 12% of its portfolio invested in China. Looking to now add to this position.

Individual stocks-Another reason I hate individual stocks is because an event like a big conference can impact the stock. Apple has one of those today.  Will Steve Jobs show up? How will he look, what new product will they feature? – I have no idea on how to answer these questions that will move the stock. All I know is technically it outperformed the major US markets and like NVS is at a new high.

Taking advantage of falling dollar. There is a downside to a falling dollar, especially a currency that falls like a stone. However for most American companies that rely on exports for real organic (not cost cutting) growth benefit from this.  It also inflates the prices of commodities. Its no accident that as the dollar reaches a yearly low commodities like gold, oil, and copper reach highs. So any country or commodity play looks good right now.

Right now Investors411 is caught with its pants down because we are not more fully invested in countries & sectors where the money is flowwing.

Have to update positions section (away all weekend) Investors411 problem is that we are under invested in equities. The predicted 5 to 10% correction this month almost happened last week (-4+%), but close doesn’t count.


Long Term Outlook = CAUTIOUSLY BULLISH

See Changes in STRATEGY, POSITIONS, & OVERVIEW sections of blog

AS ALWAYS DO YOUR OWN RESEARCH BEFORE INVESTING!

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