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Comfort Zone Investing: Road signs, good and bad, to navigate the market

Unlike Commissioner Gordon who can send out the Bat signal to call his helpmate against crime, there is nothing investors can do to summon aid in times of stress. They have to go it alone. But they can be armed with intelligence that helps. Here are few of the most prominent data points that will make a difference for all stocks, a macro perspective that should make navigating the stock market highway a little easier.

However, taken on a one-time basis, these aren't going to solve the mystery that is the market. Rather, data has to show a trend before it can be used. Even then, a trend stops and another begins. So even though the trend can be your friend, it can just as easily turn and become your enemy. As they used to say on Hill Street Blues: Be careful out there.

Continue reading Comfort Zone Investing: Road signs, good and bad, to navigate the market

Cramer on BloggingStocks: Deficit tally to make stocks more fragile

TheStreet.com's Jim Cramer says that rather than selling and moving into cash, consider these reasons to hold firm.

Look, the deficit numbers are awful. They are totally daunting. We have to hope they don't come true because they are way too big to cope with no matter what we do with taxes. The dollar will get killed. Our kids will be stuck with some horrifying bills. The disaster that Matt Horween outlined in his multi-part op-ed series a couple of weeks ago will happen.

So, why don't I say you should go into cash because of it? Couple of reasons: First, I have to have some faith that the government will grow up, that they will get serious about spending, that President Obama will get serious about spending. Second, I hope we have much more growth than people realize and therefore we can grow our way out of this jam.

Continue reading Cramer on BloggingStocks: Deficit tally to make stocks more fragile

U.S. government right-sizing: Will your local post office be closed?

Could your local post office, particularly those in small-town America, close? My DailyFinance colleague Bruce Watson says indeed, that could be the case, and I want to encourage you to read his analysis of the issue.

The U.S. Postal Service's budget problems -- it has amassed a $7 billion deficit -- highlight several points/realities that are relevant for investors.

Continue reading U.S. government right-sizing: Will your local post office be closed?

U.S. Q2 GDP report: Era of 'frugal consumer' continues

The key statistic in the U.S. Q2 GDP report, aside from the 1% decline in GDP, which was below the 1.5% Bloomberg News consensus estimate: the decline in consumer spending.

Consumer spending declined 1.3% in Q2, compared to a 0.7% increase in Q1. In Q2, durable goods decreased 7.1%, compared to an increase of 3.9% in Q1; nondurable goods decreased 2.5%, in contrast to an increase of 1.9%; and services increased 0.1%, compared to a decrease of 0.3%.

Continue reading U.S. Q2 GDP report: Era of 'frugal consumer' continues

Ignore Washington -- keep saving; General Patton makes a point

General George S. Patton was attributed with saying: "No poor bastard ever won a war by dying for his country. He won it by making other bastards die for their country." This was played out to perfection by George C. Scott in the Oscar winning 1970 movie 'Patton'.

I feel the same way when I hear and read about how we need to spend more to revive the economy. You should let the other poor bastard spend for his country -- you should be saving!

Reuters reported earlier in the month that consumer spending continues to fall and savings are increasing. That's a good thing. The public gets it, the government does not.

e won it by making the other poor dumb bastard die for his country."
- Attributed to General George Patton Jr

Continue reading Ignore Washington -- keep saving; General Patton makes a point

An infrastructure play that's still really cheap

Not all infrastructure plays are created equal. What has been a fabulous trend to ride since the lows of November has left a few players behind. One of those is Manitowoc Company (NYSE: MTW).

Granted MTW has improved off it lows, but it has not shared the same momentum heading into 2009 as others. Shares MTW sold off to the tune of 12% Thursday and lost another 3% on Friday.

The company stated that profit will likely come in at the low end of its previously announced guidance range of $3.15 to $3.25 per share. Given that there's only a 3% difference between earning $3.15 per share and $3.25 per share, what accounts for the other 9% of today's sell-off?

The company manufactures and sells cranes: lattice-boom crawler cranes, mobile telescopic cranes, tower cranes and boom trucks for use in energy, petrochemical, industrial projects and infrastructure development such as the building of roads, bridges, commercial and residential construction, and mining and dredging.

These are just the things that will do well once the new administration passes its massive infrastructure spending bill. For whatever reason, the stock cannot ride the coattails of this expected boom to its business. MTW now forecasts earnings for '09 of just $1.35 to $1.60 per share. Analysts, on average, were expecting earnings of $2.63 per share, so I take the sell-off not as an indictment of 2008 earnings, but of 2009 earnings.

These downside revisions are troubling to be sure, but do they set the table for future earnings gains?

Continue reading An infrastructure play that's still really cheap

Putting $120 trillion into the global economy?

Almost everyone who can get a quote in the newspaper or five minutes on TV has a solution to the global economic meltdown. These range from more financial regulation to stimulation of housing to government programs to create new jobs.

The head of the IMF put all of that into context with his opinion that spending by nations around the world to help get it out of a deeper and deeper recession has not been nearly enough. According to Reuters, "The IMF has called for fiscal stimulus -- higher government spending and temporary tax cuts -- worth $120 trillion, or 2 percent of global annual economic output, to fill the gap caused by slumping private demand following the credit crunch."

The view is, to a large extent, mirrored by the plan Obama has suggested. Spend money now even if it puts the government into a huge debt hole. But, does it make any sense?

Continue reading Putting $120 trillion into the global economy?

Sunday Funnies: When will Bush start fiddling?

President George W. BushSome might say that President Bush started fiddling with things during his first election. Many in the opposition certainly felt that one of the Bush's was fiddling with something down in Florida. In any event a whole lot of fiddling has been going on since that time. Whatever credit he wants to take for the economy because of his tax cuts (think manipulation or confuscation) of which I am a benefactor, I think it is more delusion on his part.

The real reason as most would acknowledge, even if it is in hindsight, has been the easy credit. We have heard of dumb money -- this was stupid money or insane money -- but fiddle he did. And now that the house (deflated of course) of cards is in the process of coming down, along with the value of our currency we do not see anyone stepping up to shoulder the blame or offer true leadership how to improve our position. Instead we see a lot of finger pointing.

So any day I expect to see President Bush pick up a fiddle just like Nero, position himself on the balcony and start to whip out a tune. As he does, you can just picture Hillary Clinton ordering him to be gently lifted out of the White-house while he continues to play, not realizing that his time has past and it is her turn to point fingers.

Even though Hillary Clinton appears to have high negative sentiment in certain corners, it is also looking more and more like she can start thinking about running mates. Not publicly of course, but the nomination seems to be hers to lose on the Democrat's side. On the Republican side there does not seem to be a bounty of ideas, and none of the candidates will be able to help themselves in any way by linking their futures to Bush or any recent successes of the party. As it stands now, no matter who wins the Republican nomination, it is hard to run on $100 a barrel oil, 40% less potent dollars, no game plan for Iraq, growing deficits, and more.

Continue reading Sunday Funnies: When will Bush start fiddling?

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DJIA+73.0010,270.47
NASDAQ+18.862,167.88
S&P 500+6.241,093.48

Last updated: November 14, 2009: 09:34 PM

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