I have always felt that for all the blabbing we do -- or blogging, in my case -- we should try as best we can to be accountable for our good and bad calls. This report is long overdue, but I will post it anyway since all of my past year's picks and results have been made public.
The market was very harsh in the early part of 2009, filling investors fear and trepidation, and sinking to a March 9, 2009 bottom. Perhaps some of the bleeding has stopped, but the economy has not healed as bears and bulls seem to carry the day, or every other day.
Continue reading Chasing Value™: 2009 Results Crushed the S&P 500
Robert Prechter is best known for his use of the Elliott Wave theory. He rose to prominence in the 80s, especially after he advised clients to exit ahead of the 1987 crash. Today, Prechter foresees the U.S. economy sinking into a deflationary depression with stocks plunging. The Dow Jones Industrial Average may sink to between 1,000 and 3,000
Prechter uses the Elliott Wave principle to plot market movement in waves. In a traditional bull market Prechter projects a five wave primary bull pattern. In a primary bear market he uses three waves down (ABC). According to his theory, the first leg down was from Dow 14,000 to 6,400 (A). The next wave up was from Dow 6,400 to 11,000 (B). He feels that we are now in wave (C) down. This is the most powerful and vicious wave.
Continue reading Prechter Forecasts Dow 1,000
So, how is that Summer of Recovery working out? Following Tuesday's drop, the market was slightly lower Wednesday morning thanks in part to the ADP payroll report. According to the report, employers added 13,000 jobs in June, falling short of the consensus estimate for 60,000 jobs. This data looks at private-sector jobs only and suggests that payroll gains were tame in June thanks to small businesses that were cutting jobs.
All of Wednesday morning's news wasn't bad, as the European Central Bank (ECB) offer of three-month funds came in short of expectations. This data means that the region's banks may not be as ECB-dependent as some thought. In addition, the financial sector is prospering as the exposure to European banks was made to appear a bit less toxic. Furthermore, Democrats in Congress decided to take a bank tax off the table in the new financial overhaul bill. This move has helped bring Republicans on board and makes the bill look like it may pass.
Continue reading Dow on Verge of Worst Second Quarter Since 2002
With the Dow looking set to open below the 10,000 level this morning, I decided to take a look at some technical statistics for the blue chip barometer. I was looking for some sort of signal that the Dow may be ready to turn around, perhaps the Dow was near some sort of support. Perhaps there is some technical formation that this latest "slight correction" has come to an end.
Something I found was that it looks like the Dow may have set a double bottom in the 9,900 region. A look at a weekly chart shows that this region acted as support in February, sending the Dow to its latest rally. Last week, the Dow bounced off this level and staged a late-week turnaround. The question is whether the Dow can maintain the momentum that started last week. In addition, the Dow may have found a measure of support from its 20-month moving average.
Continue reading Has the Dow Set a Double Bottom?
So, Europe has stepped to the plate and agreed to a almost $1 trillion rescue plan to help avert a debt crisis, with the U.S. Federal Reserve pledging to do its part for overseas loans. The move has been cheered on the Street, as the major indices are significantly higher, the Dow Jones leading the way with a more than 400-point gain. This gain makes up a good portion of last week's plunge, which was driven by fears that Greece's debt problems would eventually spread to all of Europe. The fear was that such a scenario would put the future of the euro and the economies of the 16 countries using the currency in economic peril.
Continue reading Dow Jones Jumps 400 Points, Now What?
As soon as the opening bell sounded this morning, the Dow Jones Industrial Average (DJIA) plummeted more than 150 points - effectively ruining yesterday's 143-point gain. In fact, as I write this blog, the Dow fell past a 200-point loss.
Why the drop? Blame it on Greece
, as the euro fell against the dollar thanks to worries that the Greek government will not be able to meet the rather stringent guidelines of its aid package. Moreover, the German government is set to provide most of the EU's support, and there is no guarantee that the electorate will back Chancellor Angela Merkel. Add this to the fact that German retail sales dropped more than 2% in March, and we have a full-blown European panic hitting Wall Street.
Continue reading Dow Jones Falls Below 11,000
3M Company (MMM
) benefited from a comment from brokerage Morgan Stanley. The brokerage house believes that 3M will rally after an optimistic forecast from Danaher (DHR
), which operates in many of the same markets as 3M. The broker believes that the stock will enjoy a nice 30-day run thanks to DHR's forecast
The thing is, if the stock continues the performance it started in early 2009 -- we shouldn't need a brokerage to tell us that the stock will do well during the next 30 days. Shares of 3M have advanced along the double-barreled support of its 10- and 20-month trendlines. The last time the equity finished a week below both of these trendlines was more than a year ago.
Continue reading 3M Company Enjoys a Solid Day
The negativity in the market place has been palpable for several years and is only thawing out now, in some people's view, while others rant about a "double-dip" or "W-shaped" recovery. In contrast to those who shun the market, I have been buying stocks at bargain basement prices over the past year with a return on investment that is "staggering," to quote a Wells Fargo Financial Consultant familiar with my account.
I am well aware that the record deficit spending in the United States is even more staggering. Everyone knows about the high unemployment rate, foreclosure rate, bank failure rate, and tepid consumer confidence. So why am I so optimistic about the economic recovery? Here's why, as simply as I can state the case:
Continue reading Serious Money: Optimistic Economic View
Looking back just a few weeks, the markets ushered in the new year with euphoria. Within a few short weeks, things have turned sour. The Dow dropped below the 10,000 mark last week. S&P 500 is down 7.3% from its 15-month closing peak.
Now the question facing investors and traders is whether the market is in a corrective phase. Eric Kuby of NorthStar Investment Management Group thinks so. "I'm in the camp that believes that we are in a correction," he said.
Continue reading Are U.S. Stocks in a Correction Phase?
After reading an unbelievable sell recommendation by one of my BloggingStocks colleagues, I didn't know whether to laugh or cry. In Thirteen Dow stocks that are doomed, we are informed that 13 of the 30 are going down and we should all bail out before it is too late.
I find this silly on many levels. For one, 13 stocks amount to a large-cap index fund and since large-cap stocks have lagged the market the probability that they will outperform going forward is real and has many investors promoting them.
Continue reading Serious Money: These Dow Dogs are not -- AA, T, BAC, BA ...
Now that the U.S. economy is growing -- GDP grew at a 3.5% annualized rate in Q3, according to U.S. Commerce Department data
, one key question for investors large and small is: Is the U.S. economic expansion sustainable?
Investors can immerse themselves in data on consumer spending, retail sales, new home sales, auto sales, and factory output etc., and all of those provide clues, no question. But if you're time-pressed and you want one metric to gauge the U.S. economy's likely health 6-9 months from now, monitor: monthly non-farm payrolls,
as tallied by the U.S. Labor Department. I.E., how many jobs the U.S. economy lost or created in the previous month.
Continue reading Want to know where the Dow is headed? Keep an eye on job growth
We've watched stock market numbers bounce around for two years. Unemployment stats have served as unpleasant reminders that, for some, leading indicators haven't translated to reality. We look for so many ways to understand the brutal economic environment with which we've had to contend, and all the choices can make your head spin. So, let's make it simple. Here are eight ways to tack a label onto the financial world in which we live.
1. Lost market value
Total stock market losses from October 2007's top to March 2009's bottom: $11.2 trillion
Total gains in the stock market since the bottom: $4.6 trillion
Lost ground: $6.6 trillion
2. Bad days
Percentage of the 10 worst days in history for the Dow Jones Industrial Average that happened in 2008, by point drops: 60%
Percentage of the 10 worst days in history for the DJIA that happened in 2008, by percentage drops: 30%
3. Mutual funds
Value of mutual fund assets at the end of 2007: $6.5 trillion
... and a year later: $3.7 million
Lost value: $2.8 trillion
But, it got a little better at the end of August 2009: $4.5 trillion (value of assets)
Continue reading Eight ways to define the recession
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