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31 December 2008

5 Signs Your Investment Advisor May Be Dishonest

Do you have a sinking feeling that your money manager is benefitting from investing your money more than you are? Can you sleep at night entrusting your hard earned savings with your money manager? If you have some reservations about where you've invested your money, here are some red flags to consider:

  • The background check doesn't check out
  • You don't understand the strategy
  • Your manager makes a bundle even if you don't
  • No one else is watching the books
  • Your fund manager doesn't invest alongside you

Ask these questions when choosing your money manager. If you already have a money manager and these 5 issues are concerns then you can read more here...

Financial Forecast for 2009

Do you wonder how your investments will perform in 2009? Here are some highlights from Jon Markman's newsletter.

No. 1: Infrastructure spending plans will bog down in Congress.

No. 2: The unemployment rate will approach 10%.

No. 3: Weak second-quarter earnings will dash hopes.

No. 4: Synchronized swoon will become an Olympic event.

No. 5: Markets will reach lower lows.

No. 6: Chinese growth will slow to the 0%-to-4% range -- or worse.

No. 7: Russian, Persian Gulf and Japanese investors won't bail out the U.S.

No. 8: Treasurys will trump corporate debt.

No. 9: Market timing will beat buy-and-hold.

No. 10: Investors will seek low-risk growth.

No. 11: Russia will seek its own bailout.

Fill in the blanks -

30 December 2008

Israel Retaliates Against Hamas

Is Israel's retaliation justified? Is it excessive use of force? Should Israel invade the Gaza Strip and overthrow Hamas?

Would the United States (or any other country for that matter) sit idly by as a neighboring country lobbed rockets over the border, killing civilians and destroying buildings?

Hamas is nothing more than a terrorist organization determined to exterminate Israel, aligning themselves with the ideology of Iran.

As Israel continues its fourth day of attacks, the death toll reaches 375 and the Prime Minister warned that the air offensive is only the beginning.

Israel is in the first stage of their operation with a ground attack looming. Israel says its offensive is only against Hamas militants, but Palestinian parliament member Mastafa Barghouti has called the raids a "war on the Palestinian people" and said the incursion is politically motivated.

Like most terrorists, Hamas militants are firing rockets and killing civilians then, in a show of courage, hiding behind their own civilians .

This is an area of the world where there can, unfortunately, never be peace. It is a terrorist breeding ground that the United States recently made worse with the destabilization of Iraq. The fight's against terrorism and terrorists, but since kids in the region are raised to hate and to fight, the war will be difficult to win.

26 December 2008

Year in Review - 8 Days to Remember

The year 2008 was a wild ride for investors and a turning point in the American economy. It could be very well the year that marks the end of economic dominance by the United States. Here are some defining days in this wild ride.

June 6, 2008

Crude oil prices were soaring, this was the worst day on Wall Street before the credit crisis hit. Oil had risen $16 in two sessions, was up $10.75 that Friday. Wall Street sold off 394 points or 3.13% but was still at 12,209.

Consumer spending became a huge worry as gas prices spike to $4 a gallon and unemployment jumped to 5.5%, biggest one month surge in 20 years. Demand dropped leading to gas prices plummeting in late summer.

The government's $100 million stimulus package was having little effect.

September 15, 2008

The stock market dropped 504 points or 4.42% as the 158 year old investment bank Lehman Bros. declared bankruptcy. The Dow was trading at 10,917.

Stocks traded lower on further news that AIG was having trouble raising capital to fend off a downgrade. Later that week the government would bail out the company for $85 billion.

Also, Merril Lynch sold itself to Bank of American and Washington Mutual searched for a white knight to avoid bankruptcy. One month later it would become the biggest bank failure in history.

Quick action by the Federal Reserve, FDIC, Treasury and lawmakers would pour trillions of dollars in rescue money into the system. This day would make the start of the credit freeze.

September 29, 2008

Congress rejected a $700 billion bailout plan presented by the Treasury and Federal Reserve. Investors expected this to pass, when it didn't stocks would sell off in its worst day ever, dropping nearly 800 points in one day. The plan would pass a week later.

October 9, 2008

The Dow fell 2,400 points in the trading sessions spanning Oct. 1- Oct. 10, a drop not seen since 1930. On this day the Dow, trading at 8,579, dropped 7.33% as Treasury officials said they would purchase equity stakes in banks.

Announced just a week after the bailout plan was approved, the plan was radically different than the plan that was sold to Congress. The market shunned the strategy shift.

The Chicago Board Options Exchange Volatility Index, a measure of investor fear, rose as high as 64 on Oct. 9th, the first time it ever rose over 60. Later in the month it would reach 90 before falling back to 50. The index typically trades between 15-20 and never rose above 30 before this year.

October 13, 2008

The Dow would rally back 936 points or 11.2% cutting its loss from the 8 day slide in half. A series of global initiatives and details about the $700 billion bailout plan being announced was credited for the bounce.

In addition to buying up equity stakes in banks, and, eventually, mortgage-backed securities, Treasury said it would purchase whole mortgage loans, insure home loans against default and help keep delinquent borrowers in their homes.

On Oct. 12, 15 European nations agreed to help their troubled banks by injecting capital and guaranteeing inter-bank lending. Additionally, the British government said it would pump $63 billion into three of the country's banks.

The U.S. Federal Reserve responded by offering an unlimited supply of dollars to three other central banks in an effort to keep money flowing. The list eventually grew to 13 foreign central banks.

October 15, 2008

In its biggest percentage drop since 1987, the Dow lost nearly 8%. It has fallen 35% year to date. The Dow is trading at 8,577.

The market was taking its cues from some gloomy economic indicators including a report that showed retail sales suffered their biggest drop in three years.

Comments by San Francisco Federal Reserve President Janet Yellen drove the point home by announcing that the economy "appears to be in recession".

November 5-6, 2008

While the nation rejoiced in Obama's victory, the market shifted its focus back to the economy. The Dow rose 300 points as the election got under way, but then quickly reversed to its worst ever two day point loss, dropping 929 points or 9.66%.

Unemployment was the stimulus for the declines as claims shot to a 25 year high.

December 1, 2008

Confirming what the rest of the world has known for the past year, the National Bureau of Economic Research announced that the economy is in a recession.

Stocks tanked, even though the news was not a surprise, on the predictions that the recession could last well into 2009 and be the longest in history.

The market's selloff came after a huge 5-day surge in which the Dow gained just under 17% in the closing week of November. In a sign of a tumultuous year, that rally came after stocks hit multi-year lows Nov. 20, with the Dow sinking to near 7,500 points.

Fed Chairman Ben Bernanke added that the economy will take some time to recover even after the credit crisis is over.

23 December 2008

Madoff Ponzi Scheme

Was Bernard L. Madoff's Ponzi scheme the largest in history. Investors lost $50 billion dollars. But what is a Ponzi scheme? Did you know it was named after a con artist named Charles Ponzi? He orchestrated a postal coupon scheme so large he made millions. It was so famous it prompted officials to name similar schemes after him.


22 December 2008

Army Robots to Help Save Soldiers

The Army has been using robot technology for some time now, but they are currently developing a robot called Battlefield Extraction Assist Robot or BEAR, built by Vecna Technologies. While still a prototype, BEAR will be able to retrieve injured soldiers from the battlefield.

BEAR is built in a semi human form with eyes, ears and arms and is capable of lifting 250 pounds while standing on its toes. Outfitted with lights, two cameras and infrared capabilities, it can travel up to 10 MPH and is remotely operated.

Robots can be outfitted to accomplish various duties. One can detect 38 different kinds of chemical or biological explosives from 3 to 5 meters and can be used to scan car doors or trunk lids for explosives or chemical residue.

About 10,000 robots are expected to be deployed in 2009. Packbot, already deployed in Iraq, is used for surveillance, reconnaissance and explosive removal. Packbot can be outfitted to react to voice commands given remotely through an earpiece.

Some robots can be outfitted with a retractable mast called a zipper mast or situational awareness mast. These mast are equipped with cameras or communications devices that can peer over a wall without risking a soldier.

Star Wars had a lot of foresight, robot warriors are on their way. Or is the military copying the movies?

19 December 2008

President Bush Announces Bailout Plan for Automakers

The Bush Administration will make $13.4 billion from the TARP funds available to U.S. automakers to keep them afloat for a few more months. The automakers will have until March 31st, 2009 to prove they are a viable company and will be able to operate profitably.

This loan uses most of the rest of the first $350 billion appropriated by Congress. If Congress approves the use of the last $350 billion, the automakers can borrow an additional $4 billion.

The loans are for 3 years but will have to be repaid within 30 days if they don't prove their viability by March 31st.

GM thanked the administration for the loans and looked forward to showing what American ingenuity can achieve.

The terms of the loan are similar to what was approved in the House but shot down in the Senate. The automakers must limit compensation and eliminate perks. They also must issue warrants, which convert to non-voting stock, to the government.

The terms don't include a car czar, but does say a government designee will determine if the automakers are making changes that will make them viable. It is expected that Treasury Secretary Henry Paulson will fill this role.

Details of the automakers plans must be submitted to the government by February 17th. The government wants the automakers to reduce their debt by two thirds via a debt to equity exchange with current bondholders and get the Unions to agree to wages and work rules competitive with non-union plants operated by Asian companies by the end of next year.

The government is also requiring GM and Chrysler to use their stock to pay for half of the future retiree health care expenses, which will be paid by union controlled trust funds rather than the automakers themselves, starting in 2010.

There is flexibility in the terms that allow automakers to hold the loans even if they don't meet the targets, if they can explain why they are still viable.

Automakers recently announced plant shutdowns that will last weeks longer then is typical for this time of year.

17 December 2008

Obama Names Secretary of the Interior

President-Elect Barack Obama named Ken Salazor the new Secretary of the Interior. Salazor is a first time democrat Senator from Colorado who spent 11 years as an environmental lawyer. He supports oil drilling on federal lands and is a champion on environmental issues and alternative energy. He wishes to reduce the dependency on foreign oil.

Thomas Vilsack, a former Iowa governor and attorney at the Dorsey Trial Group, was named the Secretary of Agriculture.

16 December 2008

Stocks Rally Ahead of Fed Decision

The Stock Market awaits the Federal Reserves decision on what it will do with interest rates. Rates are currently at 1% and investors expect the Fed to lower them to 0.5%, some expect them to go to 0.25%. Either way they are almost as low as they can go and any rate cut is not expected by itself to have much effect on the economy. The Fed has been lowering rates since September of 2007 and the economy has actually gotten worse, not better.

Of most significance will be the accompanying statement the Fed will release about the economy, labor market and the credit crisis. Also, investors will be interested in what else the Fed has up its sleeve. Recently, the Fed has used a range of innovative tools to jump start the economy with little to no positive results.

The housing starts and building permits plunged 15% to record lows in November to an annual rate of 616,000 for both areas. These were worse than economists expected.

The consumer price index fell 1.7% in November after falling 1% in October. Economists expected a drop of 1.3%.

The core rate, which excludes the things consumers use most...uh, I mean the more volatile food and energy, was flat, versus an expected rise of 0.1%.

The dollar has resumed its decline falling to an 8 week low versus the euro and is hovering near a 13 year low versus the yen.

15 December 2008

5 Mistakes Investors Make

MSN posted an article on the '5 biggest investing mistakes'. While in general I can agree with the philosophies discussed during bull markets, it's a hard pill to swallow when we're going through what we are today. Granted, if you didn't get out of the market before the collapse, it may be too late to get out now. That is, if you think we're near a bottom. If you think the economy is on the verge of turning around, then now is probably a good time to buy. If you think that the economy is going to get worse before it gets better, then it may not be too late to sell your holdings and preserve your capital for even lower prices. The key is, however, you can't wait until the market recovers to where it is today to re-enter the market. You have to have a plan and determine when the risk of further economic deterioration has subsided.

The 5 mistakes MSN discusses are:

1. Panicking and Selling.

When the markets are tanking the way they did in October, most people will hope for a swift rebound then swear to sell if they can get most of their money back. But the downturn we had was bigger than most expected so investors tend to want to stop the bleeding and get out even with big losses.

MSN recommends holding your investments since your losses aren't realized until you sell. Past market downturns have eventually rebounded and in the long term you will be better off, you will recover your losses and even make money. Many investors will panic, sell low, then buy back in after the market recovers, essentially selling low and buying high.

I get this and can agree to a point. At some point, if you believe the market is not done tanking, it is not a bad idea to sell some or all of your holdings on a rebound, preserve your capital and return to the market when it looks like the economy has a chance of recovering. The markets love to suck in investors to steal their money in bear markets. This is called a suckers rally. I haven't seen anything that is screaming to me that the economy is done getting worse. The government is still bailing out corporations, unemployment is still rising, banks are still not lending, the auto industry is still on the brink of failure, etc, etc. I'm still glad that I went to cash 7 months before the stock market wipeout.

2. Tuning in Too Much.

There is a lot of information out there, on TV and the internet. People tune in and want to react to every little bit of information. One day the market is up and the next it is down. Reacting to every bit of news can kill your investments.

This information overload can cause investors to react emotionally instead of logically. I agree with this. Develop a long term plan and don't get bogged down too much with day to day stuff. Reposition your portfolio based on what your long term plan is.

3. Halting Retirement Contributions.

MSN recommends to continue contributing to your retirement plan. Many people have lost half or more of their retirement funds and don't want to throw good money after bad.

It is understandable that people are hesitant to contribute more money into a plan that is losing money at alarming rates. But you don't have to invest it in the stock market. Put your money in a money market fund or keep it in cash until you believe the economy is about to rebound and the market looks to be making a bottom, then begin to slowly invest back into the market.

4. Veering from Your Plan.

MSN says that during market downturns people will stray from the path of their long term plan. Instead of holding and waiting, investors begin to try and time the market for quick profits.

I think the long term plan is a good idea, but I think that considering downturns and readjusting your portfolio accordingly can be part of the long term plan. Trying to time the markets for quick profits is probably not a good idea for a retirement portfolio. Keep this speculative activity for a separate account. I'm not an advocate of buying stocks and not checking them again until the day before you retire, like many buy and hold advocates will tell you. Holding through downturns in a bull market when the economy is growing is fine, but holding through a downturn like we're having today is going to be costly. If you are close to retirement, it is possible that you may never recover the losses you are accumulating. Even though analysts don't like to compare this market to Japan's market in the 1990's, it is possible that, like Japan, this market could take 20 years or more to recover. Japan's still hasn't recovered after 18 years and given what's happening today, it could be another 18.

5. Holding One Basket on the Upswing.

It is important for investors to harvest cash when they have top performing stocks or funds during an upswing. Take some profits after a price increase; it is easier to sell during times of investor enthusiasm and get good prices, although greed keeps many investors from letting go of profitable trades. Also, investors should invest in a diverse cross section of the economy to take advantage of rising sectors and counterbalance sectors that aren't performing as well.

By taking profits from big winners it makes it possible to change the definition of portfolio diversity and buy investments that are more appropriate for the economic climate. Recently, as stocks plummeted, investors switched to bonds for safety. Soon they will need to re-evaluate this strategy and find the next hot sector.

Have a plan, diversify, but don't be afraid to reallocate your portfolio to investments appropriate to the economic climate. And if you fear a huge market correction, it is better to be safe than sorry. You may give up some short term gains, but you might be better off preserving capital for better opportunities. In this market, it is better to be a month late than a month early.

Home Values Plunge in 2008

Home values have dropped 8.4% year over year since 2007. That amounts to homeowners collectively losing over $2 trillion in value.

Some 11.7 million Americans are now "underwater" owing more on their mortgages than their home is worth. Most of the subprime loans that will fail, have failed. But there are still option ARM's that are expected to continue an increasing failure rate and the so-called 'liar loans' where incomes were not verified are expected to continue failing.

While the decline is beginning to slow, there is no bottom in sight. The worst performing market is in Stockton, Ca where housing prices have dropped more than 32%.

A few cities have registered gains over the past year with Jacksonville, NC leading the way with home values rising 4.9% year over year.

13 December 2008

Obama Names Housing Secretary

Shaun Donovan, New York City's housing commissioner was nominated by President Elect Obama to be the Secretary of Housing and Urban Development.

Donovan has said that addressing the mortgage crisis is essential for restoring the American Dream.

Obama has asked his economic team to develop a plan to keep Americans in their homes and stem the rise of foreclosures that are crippling the economy.

Donovan has experience working in business, academia and at HUD during the Clinton administration.

Last week jobless claims rose to a 30 year high and that 1 in 10 people who hold mortgages are in some form of distress, highest in ever recorded.

12 December 2008

Trader Pyschology

Succeeding at trading in the markets combines learning everything you can about the markets and trading tools and getting to know yourself as a trader.

Learning about the markets and technical analysis tools is the first thing that most traders dive into, they often are unaware of how important the roles of human nature and psychology play in defining markets and market success.

Becoming a profitable trader is more of a journey than a destination. Concentrate on learning the craft of technical analysis and try to become a better trader each day enjoying the progress you make. Focus on improving your trading skills rather than on the amount of profit or losses in your trading.

Feel good about a trade when you have followed your trading plan and congratulate yourself, regardless of the profit or loss on the trade.

Treat your trading like a business and maintain an even keel and professional outlook. Don't get to overly excited about winning trades or depressed about losing trades.

When entering a trade there is no certainty. You are looking for a preponderance of evidence or a high probability that a trade will react a certain way according to your indications of trend and reversals and your trading plan.


Learn how to use psychology to your advantage. Today's markets offer extraordinary opportunities for those that know how to spot the trends.

11 December 2008

Debt Drops for 1st Time Ever

The consumer debt that Americans hold dropped by 0.8% in the third quarter by an annualized $30 billion. Net worth also dropped as house prices and stock prices dropped.

On the surface that seems like a good thing. But since America's economy basically runs on debt, it's not good for the recovery. People are spending less and loans are harder to come by, so purchases of homes, cars, boats and other big-ticket items has fallen.

Americans are experiencing a major shift in their spending/saving philosophy. Instead of spending their entire paycheck as it comes in, they are saving for the future. Saving used to be the job of their house, as housing prices were rising. Now you can't depend on that.

With 70% of the GDP coming from consumer spending, this trend is a cause for concern.

Net worth of Americans dropped by 4.7% in the third quarter or by $2.8 trillion.

10 December 2008

Thoughts on the Future of the Markets

Fortune spoke to eight of the sharpest thinkers on the markets. Here is a summary of what they had to say. Click on the title to read the article posted on CNN.

Nouriel Roubini - Known as Dr. Doom, the NYU economics professor saw the mortgage-related meltdown coming.

Roubini says we are in the worst recession of the last 50 years. It is an unwinding of a huge leveraged - up credit bubble. All of the advanced economies will experience a hard landing and the emerging economies will experience a severe slowdown. And it will get worse.

GDP will be negative throughout 2009 and during the recovery in 2010 and 2011 will be very weak. So weak it will feel like a recession. Unemployment will peak in 2010 at 9% and housing prices will fall another 15%.

Roubini says that for the next 12 months, stay away from risky investments like the stock market and commodities and invest to preserve capital. Buy treasuries and bonds. It is better to make low returns than to lose 50% of your capital.

Bill Gross - The founder of bond giant Pimco warned of a subprime contagion back in July 2007.

In 2008, over $30 trillion worth of paper wealth was destroyed. This was not caused solely by the sub-prime mortgages alone. There was a great leveraging that embodied derivative structures of all types. As 2008 ends, investors are fearful that the recession may bring us to the brink of a depression.

Federal guarantees and trillions of dollars will be required to fill the gaps created by the deleveraging of private balance sheets. The process will take longer than 12 months and after the bottom is reached profit margins and earnings growth will be low.

Investors will have to be content with single digit returns for quite awhile and should stick with high quality bonds and preferred stocks, especially those that are part of the TARP bailouts. While the returns will be small they should be safer than most other investments.

Robert Shiller - The Yale professor and co-founder of MacroMarkets called both the dot-com and housing bubbles.

Shiller sees similarities between now and the 1930's. The percentage rise and fall of the stock market, interest rates and housing prices. Unemployment is not anywhere near the '30's, however.

Other similarities include consumer confidence (even though our numbers don't go back that far, it is likely at its lowest level since then), volatility, biggest one month drop in consumer prices and it's a world wide event.

He thinks we'll manage it better this time around, but we are still vulnerable. One of the lessons from the Depression is that things can smolder for a long time. Consumer confidence needs to return to get things rolling again.

The PE ratio reached a record high at 44 and has since fallen below the average of 15. It is now 13, but in the '30's it fell to 6, so that is a concern. Investors may feel comfortable that valuations are good right now, but there still is the risk they could fall by half.

Sheila Bair - The FDIC chairman has been pushing to get mortgage relief for borrowers.

Chairwoman Bair is a believer in the basics of investing. That is find a stock you like and hold on for the long haul. That seemed to work for her mother and she would like to see America return to that philosophy.

The crisis we are currently experiencing was caused by investors not doing adequate homework in their investments and as housing prices deteriorated the problem began feeding on itself and getting worse.

Jim Rogers - The commodities guru predicted two years ago that the credit bubble would devastate Wall Street.

This forced liquidation we're in has only happened 8 or 9 times in the last 150 years. It's no fun, but the way to make money is to buy investments that are unimpaired by their fundamentals. GM and Citigroup are impaired.

The only group that Rogers can find that is unimpaired is commodities. He especially likes agriculture. The cost of raising crops is increasing and the supply of commodities is decreasing. At the same time the demand for food is increasing. Getting loans to acquire the goods needed to continue produce commodities is also getting harder. This is a recipe for higher prices.

Rogers has been buying Chinese stocks and stocks in Taiwan for the first time. He has covered his shorts on U.S. stocks and is shorting Bonds. There is a huge amount of bonds coming onto the market and soon inflation will return.

Rogers feels stocks are still overpriced. Historically, you buy stocks when yields are 6% and selling at 8 times earnings. You sell when they are 22 times earnings and 2% yield. Stocks are cheap, but yielding only 3%. To get to that 6% yield the market will have to drop to 4,000. If an investor is still solvent at that point you should be buying everything in sight.

To read what Wilbur Ross, John Train and Meredith Whitney have to say about the markets click here.

09 December 2008

Automakers to Get $15 Billion

It appears that Congress will give the automakers $15 billion. While we are still waiting for the vote, most analysts expect that the automakers will get a bridge loan designed to get them through until the Obama administration can do something more fundamental.

The government will get a 20% stake in the company calculated by how much each car maker gets in loans. So, if GM takes $10 billion the government would get $2 billion in stock. Now with GM being worth $3 billion, this means that the taxpayers will own 2/3 of the company.

In addition, executive salaries will be capped, stop paying dividends; answer to a car czar and there will be no corporate jets.

Now, it has been said that GM could need up to $50 billion over time in order to survive. If a company is worth $3 billion but needs $50 billion to avoid bankruptcy, I'm thinking they are already bankrupt. And maybe it would be better for the company to go into Chapter 11.

I know what the implications of that are. People won't buy cars from a bankrupt company; lenders won't lend to people buying from a bankrupt company; suppliers to the company could go out of business; more jobs would be lost; and on and on.

On the other side of the coin, somebody will come in and buy the company, reorganize, make it more efficient, start building the cars that are in demand and emerge with a better, more profitable company.

The current management failed to have the foresight to produce products that would survive this environment and lost billions of dollars, falling behind their competitors who did have the foresight to build the right products. I'm not convinced current management will use the bailout money effectively, losing more billions and maybe going bankrupt anyway.

And here's the real kicker, Chrysler won't open its books to Congress because they are a private company. Congress doesn't even know for sure if Chrysler needs the money, they are just taking their word for it. Chrysler won't even tell Congress who is on the board of directors.

Now, I could be missing something here, but I believe Congress has been admonishing banks, investment bankers, Freddie Mac and Fannie Mae executives and others involved in this financial crisis that one of the reasons for being in this mess is because people who were applying for housing loans were not required to prove their income, in some cases they didn't even have to disclose their income.

Now Congress is about to make the same mistake. Give GM and Ford money, but withhold Chrysler loans unless they disclose financial information to Congress. The rest of us have to fill out an application and disclose financial information, Chrysler shouldn't be exempt from that.

08 December 2008

Stock Market Profits - How to Make Money

We are experiencing the most turbulant stock market in recent history. One day the market is wildly higher and the next it is just as wildly lower. If you are a day trader this type of volatilty is a great way to make money. Of course, you need to be quick on your feet. Buy! Sell! Sometimes trades lasting minutes or less.

Day trading is very difficult and not many are successful at it. Most people don't have the temperment it takes to successfully trade this way. Usually when most people have losses they want to wait until the market recovers, then they'll get out and hopefully breakeven. But successful day traders know that sometimes you will take a loss and you have to take it and move on to the next trade.

There are a lot of brokers who are willing to give their advice on what stocks to buy, but you have to wonder if they have another making commissions or if they really have superior information that can lead to stock profits. Could be a little of both really, but wouldn't it be nice to increase your confidence in a stock pick?

A pair of computer programming "geeks" while contracted to Goldman Sachs have now developed a Stock Trading Robot they've coined "Marl" (a combination of both their first names) that they've documented picking stocks with a high percentage and low risk of doubling your money.

"Marl" works by analyzing each stock using technical analysis, which is a fancy way of saying it analyzes a stocks past price movements to attempt to determine a stocks future price movements.

Marl can easily monitor hundreds of stocks at the same time, while most individuals can only monitor a few stocks at once.

Marl can process 1,986,832 mathematical calculations per second and; Marl looks at volume traded, Support and Resistance levels, Trend reversal patterns, Consolidation patterns and Channels a stock trades in.

They claim their program averages a 105.28% trading profit which comes unsually within 3 hours of the market opening. They don't claim, however, to make money on every trade. They have, in fact, documented and displayed some losing trades. These trades are generally small compared to the winning trades.

Their software program is so expensive that the average person can't afford it up front. I suppose after some successful trades you could take another look at the cost of it. But they do have an alternative. They offer a weekly newsletter and updates that can provide some very profitable trades.

In these turbulant times information is very important. Having a successful advisor in your corner can be the difference between making money in the stock market and losing your retirement account.

To learn more about this amazing service click here!

Stocks Get Boost From Obama's Comments

President - Elect Obama pledge to boost public spending on infrastructure. Obama's speech is having a positive effect on the stock market with gains reaching highs not seen for about 3 weeks. The hope of stock investors, of course, is that the spending will filter down and help the bottom line of thousands of U.S. companies.

Oil and oil related companies as well as copper prices have been early benefactors of Obama's comments with prices sharply higher today.

President Bush has agreed to a troop pull out plan as he tries to salvage his legacy. Bush in a recent interview admitted that he wished he had better intelligence before making the decision to invade Iraq. Too bad he can't have do-overs, we all wish he had better intelligence too.

Dow Chemical is joining other large Dow Jones Corporations and will be cutting 5,000 jobs and closing 20 plants as the economy continues to worsen despite all the promises and current Congressional work to boost it.

Barney Frank thinks there is a deal between the White House and the Automakers. It's not quite what the Auto CEO's had in mind, but it has to be better than nothing. The government is willing to loan the automakers $15 billion, but may re-consider the $25 billion. They were asking for $34 billion.

Obama has accused the auto CEO's of taking a "head in the sand" approach to long festering problems. He believes that the CEO's should lose their jobs. Sen. Dodd argees with Obama and called for GM CEO Wagner to move on. Stands to reason that the current management of the automakers couldn't keep the companies from losing billions and keep them competitive with other automakers, what makes us think they will do it now?

05 December 2008

Economy Worsens in November

Job losses in November were the highest since 1974 with 533,000 jobs lost. That brings the year to date total to 1.9 million and the unemployment rate jumps to its highest since 1993 at 6.7%.

Also, job losses for September and October were revised higher at 403,000 and 320,000 respectively. Just in the last three months 1.3 million jobs have been lost.

The job losses in this recession have now surpassed the 2001 recession by 300,000 jobs. One big difference from 2001 though is that when the tech bubble burst the job losses were confined to mostly one sector, this time they are spread out throughout the economy. The labor department confesses this may be one of the worst reports they've ever had.

Analysts expect more job losses over the next 3-6 months while Obama's team works on getting an economic stimulus plan put together for approval immediately after he is sworn in. That package is projected to be around $600 billion. The printing presses are running overtime.

The so-called under employment rate, which includes part-time workers and those that have become discouraged and stopped looking for work has risen to an all-time high at 12.5%

California may resort to depression era IOU's as the recession hits particularly hard there.

Oil hits $40 a barrel and gasoline futures traded as low as .92 cents. Prices at the pumps are generally 60-70 cents higher than futures prices, signaling some relief for consumers at the pump.

03 December 2008

How to Become a Master Stock Trader

Have you been trading the stock market and been taking a beating? Are you having problems trying to decide the perfect entry and exit points? Is your system only working part of the time? You're not alone.

Have you ever thought you were going to wake up one day, plunk down a few thousand of your hard earned dollars and make a killing in the market, only to discover that by the end of the day your hard earned cash was gone. It gives you a sinking feeling in your stomach and you either never want to trade again or you are more determined then ever to get your money back!

From time to time, we all need some guidance when investing in the market. It likes to throw unwary investors for a loop as often as possible. Truth is there is nothing wrong with improving your knowledge of the markets no matter how experienced a trader you are.

Sometimes traders go into slumps, like baseball players, and it is helpful to get a new perspective on your trading strategies.

Well now there is a book that can help you make money every day the stock market is open.

You will learn:

* The shortcut secrets to day trading profits you don't know about...

* How to cream the market for all it's worth day in and day out...

* How to turn your passion for investing into a full time business that can set you up for life...

The markets will give all beginners a thrashing at least once. If you want to learn how to make profits it is a very rewarding business. It can give you the freedom to do what you want, live anywhere, travel, work when you want. If you know a few little secrets investing can be safe and predictable.

There are other benefits as well:

> You don't need a lot of money to get started.

> The time required to trade is minimal.

> Returns are almost immediate.

> It's easy to learn how to profit from the stock market.

Learn how to spot hidden trades poised to take off and put hundreds of dollars in your pocket everyday as a skilled trader using your own system.

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Here are some other hot topics covered in the book:

> The most important factor you must understand to avoid losing money... and... achieve a steady, consistent income just like professional swing traders! (Don't even think about trading until you discover this.)

> My step-by-step guide to setting up your own fail-proof trading system.
A complete explanation of market terms even a 10-year-old can understand. (No need to "crack" your brain trying to figure out complex jargon. I provide definitions of stock terms in plain simple English.)

> How to time the entry point just right so you pocket the biggest profits possible. (Here's how to spot the three trends that let you know when to get in.)

> A "secret weapon" used to pinpoint the potential of a stock going up or down. (No serious trader would be caught dead without this resource.)

> How to spot the famous "cup and handle" pattern everyone relies on to pick money making stocks!

> How to take advantage of short-term and long-term strategies to minimize your risk!

> Why you can make serious money trading stocks when prices go up or down! (I'll share with you a valuable lesson I learned by watching a stock drop form $13.80 to $13.05.)

> Four little-known rules you must memorize before you start trading... if... you want to put the odds of success in your favor!

> The basic "buy set up" strategy: How to always buy the right stock every time!

> All the "ins and out" of making a nice living as a day trading renegade!

> How a stock's moving average reveals the right time to buy or sell!

> My secret swing trading blueprint! (It took me months and plenty of mistakes to develop this process. But it works like crazy and puts you in control.)

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Here's what others have had to say about the book:

"I almost gave up but thanks to your ebook and training I am now averaging $4000 plus per week. I never thought trading could be this easy! I can't understand why nobody wrote a book like this before, Jens." Dave M., Nevada

" Dear Sir, I have been trading for many years, read many books and subscribed to many who claim that I can increase my return by 100% - none worked. The MasterTrader book that I have bought from you is worth a million dollars which I lost before I bought the master trader. No other book or newsletter teaches what the Master Trader teaches. I am sure that with the knowledge I gained from the MasterTrader I will be able to beat Wall Street. I call your book the green book..." U. Liberati Sr.

"This book is an amazing and invaluable resource for a beginner trader. Undoubtedly, the best and the most practical I have seen so far . I only wish I could have had all this information compiled in one place when I started trading. It would have literally saved me thousands." Sergei I., Canada

"Jens, I never read anything so comprehensive. I am a daytrader and will pass it on to my friends who are investing. The course covers about every aspect of the business." Dr. Mark V., Atlanta, GA


The order comes with 11 free bonuses and a 60 day money back guarantee. It is the most comprehensive trading book on the market. Learn everything you need to know in one short lesson. Become a Master Trader and earn great profits everyday do something you love to do.

Should the Government Bailout the Automakers?

The Big 3 Automakers again made their trek to Washington D.C., this time in automobiles, to make their pitch a second time to Congress. They are there to justify their need to acquire bridge loans from the federal government to regain their competitiveness in the world auto markets.

The first time they were in Washington they asked for $25 billion, this time they are going after $34 billion. GM says they will need $18 billion, but will only use the last $6 billion in case of emergency or if market conditions deteriorate further. I guess they don't consider this an emergency. Ford doesn't think they will need they $9 billion they are asking for, but want it there for a "backstop". Chrysler is asking for $7 billion.

The loans are said to help not only the automakers, but the entire economy. Without it, many analysts say the economy will suffer a major setback. This is the sales tact that the automakers are using to convince Congress they should give them billions of dollars. After all, they couldn't make their companies competitive before, losing billions in recent years, but this time will be different.

Will the bailout work or will it just put the economy in worse shape by forcing taxpayers to pick up a tab that may not get paid back? With all the money printing going on, at some point the fed will have to deal with inflation.

Congress may be fooled by the reports the Big 3 submitted, but the general public don't buy it. If fact, 61% of those polled believe that the automakers should not get the funding. Another 53% say that they don't think the funding will help the economy.

Only 15% say they will be directly affected if the automakers were to go bankrupt. As expected most of the opposition to the bailout comes from people in West, Northeast and South. But still 53% of people in the Midwest oppose the bailout.

Democrats are more supportive of the bailout, but still 53% oppose it, 70% of Republicans and 61% of Independents oppose the bailout. Seventy percent of Americans feel it is unfair to the taxpayer to bailout the automakers.

The poll was conducted by CNN/Opinion Research Corporation by phone with 1,096 adult Americans. The survey's sampling error is plus or minus 3 percentage points.

02 December 2008

Experts Warn of Terrorist Attack By 2013

Somewhere in the world, experts warn, there will be a terrorist attack with a weapon of mass destruction.

It is more likely that a biological weapon will be used than a nuclear weapon because it is easier to obtain and easier to use. There are a lot of scientists in the world that can develop biological weapons.

But that is not to say that a nuclear event is off the table. There is still a risk of a nuclear weapon falling into the hands of terrorists. They are actively trying to acquire a nuclear weapon and with many countries seeking to develop nuclear power and others expanding arsenals, the risks of a nuclear device falling into the wrong hands increases.

We're talking about the worst possible weapons falling into the hands of the worst people in the world. The consequences would be catastrophic in terms of the number of people dead.

In 1918 a flu virus killed 40 million people. Experts warn that a biological weapon used by terrorists would multiple that number by a minimum of 10.

The report interviewed over 250 experts worldwide and warned that securing these weapons would not be cheap and would require sacrifice, but it was absolutely necessary.

Ford Unveils Plan to Congress

Ford unveiled its 33 page plan to survive the crisis to Congress calling for an investment of $14 billion with $9 billion being a bridge loan. Ford says it doesn't see that it will have a liquidity crisis in 2009 and expects to break even or make a profit by 2011.

Ford has reduced executive salaried employees wages by 40% and is cancelling bonuses. CEO Mulally agreed to work for $1 if Ford uses the loan from the government. The other CEO's have made the same promise.

It will also sell some of its corporate aircraft, reduce dealerships by 14% compared to 2005 levels, cut capital expenditures, explore balance sheet restructuring and raise equity capital.

Ford is in talks with the UAW to identify ways to cut expenses. Despite these cost cutting measures, Ford does not see an end to the crisis in the near term. It did not mention any new reductions in plants or capcity eliminations, but has made a committment to speed up hybrid and electric models of cars.

Ford shares rose on the news of the plan, in fact all auto shares are rising. The other companies, GM and Chrysler have not reportedly turned in their plans yet, but plan to by the deadline of 5:00PM. Although GM's plan is not known in detail, it is said to include the sale of corporate jets and the halting of corporate jet use.

01 December 2008

NBER Says It's Official, We're In a Recession

The National Bureau of Economic Research (NBER) is a leading group of private economists that are charged with determining the start and end dates for U.S. economic downturns. Because of the need to look at financial indicators, it takes a long time to declare a recession and figure out its start date.

The NBER stated that the deterioration of the labor market was the main reason for declaring a recession and choosing the start date as December of 2007. During the first 10 months of 2008 1.2 million jobs were lost and another 325,000 are expected to be lost in November when the government announces these figures on Friday.

The NBER also looks at real personal income, industrial production as well as wholesale and retail sales. All those measures peaked between November of 2007 and June of 2008.

In addition, the NBER considers GNP. Most people erroneously assume that GNP must decline 2 quarters in a row for there to be a recession. This has not taken place yet in this recession.

It did not give any reasons for the cause of the recession, but many believe that the housing downturn led to the broader economic collapse.

The falling housing prices that peaked earlier this decade, led to falling housing starts and home purchases. This also caused a rise in mortgage foreclosures, which in turn led to billions of dollars in loses to the nations largest banks and a tightening in credit.

This is the longest recession since the Great Depression in the 1930's and is not expected to bottom until mid 2009. The two most recent recessions in '91 and '01 lasted 8 months.

The government has pumped trillions of dollars into the economy to try and pump it up and get things rolling again. So far, the economy is slow to respond, but most economists don't expect this recession to turn into a depression even with all indicators in a tailspin.

The biggest government worry now is not, 'are we in a recession', but how do we fix it? With rising costs, rising unemployment, record foreclosures and depleted savings it is very important that the government do more to help American families make ends meet.

Obama Names National Security Team

President Elect Obama named his National Security Team today. No surprises to these well kept secrets though.

Senator Clinton was chosen as the Secretary of State and awaits confirmation by the Senate.
Napolitano was named to head up the Homeland Security Department.
Gates was asked to stay on for at least another year as the Secretary of Defense.
Susan Rice was named as a UN Ambassador.
Jim Jones was selected as the National Security Advisor.

Obama says that 16 months is the correct time frame for pulling the troops out of Iraq and turning security of the country over to the Iraqis.

India says Pakistani 'elements' were responsible for the Mumbai attacks and calls on Pakistan to follow up on its words with 'action' to punish those involved in the attacks.

In other market news:

Treasury's drop to a record low on economic concerns.

Financials reverse week long advance and drop in a big way to start December.

The Manufacturing Index fell to the lowest level since May of 1982.

Mutual Fund investors are stuck with capital gains tax even as the market suffers huge losses.

OPEC delays decision to cut oil output by 2 weeks; crude oil falls and trades below $50 a barrel.

Is the market rally we saw last week exaggerated by short covering? Stocks that were most heavily shorted beat the market averages last week.

The National Bureau of Economic Research (NBER) has given us the official word, that we all have known for months, that we are in a recession. They put the start date of the recession at December 2007. Now the government can finally stop denying we are in a recession.

The Automakers have until December 2nd to tell Congress their plan for using the bailout money and what they will do to turn the industry around. GM may get $10-12 billion, but they want $50 billion. So does this indicate that the $10-12 billion they might get is not enough to do any good and therefore a waste of money or is it an indication that GM is still in denial and unwilling to become more efficient?

Automakers are expected to make concessions and compromises to get their hands on that $25 billion.