InvestTalk Podcast & Blog

Jobs

Investtalk — Sat, 04 Feb 2012 02:09:13 +0000

The jobs report for January was a big surprise with 243,000 new jobs, dropping the unemployment rate to 8.3%. Also, the previous two months were revised upward.

These numbers are good and should be looked at in that context but it is wrong not to look deeper to get a complete picture on what is going on. One good trend is in manufacturing which continues to be the strongest growth component of job growth. Manufacturing in the U.S. is gaining strength on the back of increasing exports. I think this trend will continue. The world is becoming a flatter playing field where cheap wages in other countries are starting to look less like a big advantage. Transportation costs and U.S. productivity tilt in our favor. Also, in Asia demand for higher wages is starting to gain traction.

In one sense the jobs report is misleading. Well over one million workers dropped off the employment rolls. What happened to them? They are still unemployed. Many just stopped looking for jobs. Also, many are older workers and they may never reenter the job market as their skills wane.

We all know that the government has never properly counted the number of unemployed and underemployed but no matter how you read it January was a good month for returning workers.

Good Trading
Steve Peasley

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Investing Advice from three wise men

Investtalk — Sat, 04 Feb 2012 02:07:27 +0000

Todays Stocks and Topics (KOG) Kodiak Oil and Gas Corp., (YPF) YPF S.A. ADS, Banks, Tradeing, (TZA) Direxion Daily Small Cap Bear 3 x Shares, Facebook, (F) Ford Motor Co., (PGF) PowerShares Exchange Traded Fund Financial Preferred Portfolio, (AVP) Avon Products Inc.

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Video Market Commentary, February 2012, Issue 1

Investtalk — Fri, 03 Feb 2012 15:39:16 +0000

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Generating Reliable Income in Retirement

Investtalk — Fri, 03 Feb 2012 02:07:08 +0000

Today’s Stocks and Topics: Money Making Ideas, The Stock Market, (MA) MasterCard Inc. Cl A, (PRGO) Perrigo Co., Cash reserve Funds, Dividends, (BMY) Bristol Myers Squibb Co., (ABT) Abbott Laboratories, (STD) Banco Santander S.A. ADS, (NOK) Nokia Corp. ADS, (XRX) Xerox Corp., (AA) Alcoa Inc.

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Economic and Stock Market Cycles

Investtalk — Thu, 02 Feb 2012 02:02:17 +0000

Determining the direction of the stock market in the short run is very difficult. There are so many unforeseen factors that can disrupt the most diligent analysis that calling an up or down market is akin to looking into a crystal ball. You need only look back to 2011 and the earthquake in Japan that disrupted the worldwide supply to understand how difficult projections can be. The economist that forecasted 3% growth in the U.S. can’t factor in natural disasters. They also underestimated the impact of the European debt crisis on our stock market.

This does not mean you should not make the effort to gauge the strength or weakness of the future economy, but one should always understand the weaknesses of that effort.

If the economy grows stock prices generally go up and if it shrinks it falls. The economic cycle runs ‘behind’ the stock market cycle. If one can broadly predict the economic cycle then it is easier to understand the stock market cycle. Stock markets move up at bottoms of the economic cycle and fall before the economy falters.

The effort is difficult but worth it, warts and all.

Good Trading
Steve Peasley

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Will February’s Market give us a Chill?

Investtalk — Thu, 02 Feb 2012 02:01:51 +0000

Today’s Stocks and Topics: (SWI) SolarWinds Inc., (JRCC) James River Coal Co., The Stock Market, Stock Purchasing, (TRV) Travelers Cos. Inc., (DMND) Diamond Foods Inc., Gold, (AAPL) Apple Inc.

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Markets Swings

Investtalk — Wed, 01 Feb 2012 02:08:23 +0000

We have had a long run starting in the middle of December of rising stock prices. We are now near the highs made last May and June. Last summer we fell to the lows of the year and at that time we suggested that you buy the market. Today is a time to begin to sell the market.

This moving money in and out is often called market timing and it has not been in favor with established opinions by the large institutions or for that matter the SEC. However, ever since the dot.com collapse of 2000 the stock market has been in a Secular Bear mood. If you bought the indexes in 2000 you would still be at loss today in 2012. In the 1990’s we were in a Secular Bull market and buy and holding stocks would have worked, but no longer. At some point we will return to a Secular Bull market but until then you need to be more cautious.

Recognized swings in the market such as we have seen for 11 years is a prudent way to reduce risk and try and maximize return. It does not always work but often enough to make the effort valuable. It does not mean you sell completely out and then put it all back in at one time. It is more of an effort to capture as much of the upside and not be caught unprepared for the downside. Then when the market completes its correction buy back in those stocks that are on sale.

It is never easy but it is rewarding.

Good Trading
Steve Peasley

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Beware – Social Media Securities Fraud.

Investtalk — Wed, 01 Feb 2012 02:07:07 +0000

Today’s Stocks and Topics: (XOM) Exxon Mobil Corp., (BP) BP PLC ADS, (AMZN) Amazon.com Inc., Dividends, Bonds, (GBDC) Golub Capital BDC Inc., Investing in Wealth Preservation, (PETS) PetMed Express Inc., (INTC) Intel Corp.

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Money-Markets, CDs, and Bonds: The Ups and Downs of Stashing Your Cash.

Investtalk — Tue, 31 Jan 2012 02:04:15 +0000

Today’s Stocks and Topics: (LO) Lorillard Inc., (CLF) Cliffs Natural Resources Inc., (NOK) Nokia Corp., (LINE) Linn Energy LLC, (TNH) Terra Nitrogen Co. L.P., Commitment of Traders – COT Chart, Cash Flow.

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Do Not be Fooled

Investtalk — Sat, 28 Jan 2012 02:09:52 +0000

This morning the first look at the fourth quarter GDP number was released. It rebounded from a low 1.7% in the third quarter to 2.8% in the fourth. That was less than the more optimistic expectation of 3%. For all of 2011 the GDP number looks to be about 1.8%. We won’t have a final number for another month or two and by that time we won’t care. In fact looking back to the fourth quarter is interesting but does us little good when investing in the market.

As an investor and trader you need to look forward and in doing so we see complacency, or in other words, too many people are expecting calm and that the market will continue to rise. That will not last. We have had a period of low volatility so far this year and history is likely to reassert itself so expect a pick up in movement but not necessarily to the upside in the short term.

The market is cheap and fundamentally it appears that this year will be good one for stocks but there will be swings up and down and we are due for a down movement. That movement will give everyone an opportunity. Do not fear the coming correction but use it to your advantage.

Good Trading
Steve Peasley

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