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Market Week Wrap-up

– Leading global equity indices continued floating upwards this week while the inflation drumbeat just kept getting louder. In the US, the January y/y CPI figure hit +1.6%, its highest level since last spring, and some analysts were alarmed by higher food prices creeping into CPI data sooner than expected. China’s January CPI report was lower than expected at +4.9% y/y, but markets panned the figures as heavily massaged by basket revisions. In the UK, the BoE said CPI would likely continue growing at a 4-5% clip over the short term. The World Bank released a report indicating that food prices were up 15% since October 2010 and are now only 3% away from record highs hit in 2008. Commodities moves complicated the story somewhat. While silver has pushed out to 30-year highs, there were signs that inflated soft commodity prices were beginning to unwind, with cotton and grain prices both below recent highs. Crude and gold prices have been impacted by reports that Iran is sending warships through the Suez Canal and bloody protests in Bahrain (next door to Saudi Arabia), although WTI futures were well below recent highs seen in early February. The Obama Administration unveiled its $3.73T budget proposal for 2012, including an all-time high deficit of $1.65T, reflecting the tax-cut agreement reached with Republicans in December. For 2012, the administration sees the imbalance declining to $1.1T, giving the country a record four straight years of one trillion-plus deficits. Bond prices held steady after the details were released, and Congress sharpened its knives for a budget fight. The Feb Empire Manufacturing survey hit its highest level since last June, indicating that the US manufacturing expansion seen over the last several months is continuing. On Friday there was plenty of commentary out of the G20 conference, where leaders tried mightily to achieve some concrete steps in reforming the global monetary system. Fed Chairman Bernanke took a swipe at the Chinese in his policy address to the G20, warning that nations which keep currency values low create imbalances, while the PBoC’s Zhou continued to push for a higher profile for the IMF’s Special Drawing Rights (SDRs). For the week, the DJIA rose 1.0%, the Nasdaq gained 0.9% and the S&P500 was up 1.0%. – John Deere crushed earnings and revenue targets in its Q1 report and nearly doubled its guidance for FY11 equipment sales. The firm hiked its sales guidance for its key agriculture and construction units as well, and said its Q2 revenue would blow out consensus estimates. Later in the week Caterpillar released very favorable dealer metrics for the month of January, with North America machinery sales up a whopping 58% y/y in the month. – Iron ore miner Cliffs Natural Resources reported very strong Q4 profits on a big y/y gain in iron ore pricing. The company expects global steel production to continue to grow in 2011, although it warned that spot iron ore prices are unsustainably high. Reliance Steel also blew out earnings estimates, and said pricing would remain strong at least through the first quarter of 2011. – In tech, Dell’s profit was way ahead of the consensus in its Q4 report, thanks to a big improvement in margins. The company said it believes the corporate IT…

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Market Wrap-Up for Feb.18 (JWN, CF, DLR, SWK, EOG, WTW, more)

We’re saw a gradual rise for the DOW as other indices remained fairly flat, finishing what has been a generally solid week for the averages. We added a new yield-focused name to our recommended list today, while also removing three growth names from our list as well. Be sure to check out Dividend.com Premium for those stories if you did not read the e-mail alerts we sent out earlier today. Elsewhere, earnings results are lifting shares of Digital Realty Trust ( DLR ), a recent addition to our recommended list. Nordstrom ( JWN ) bounced off of earlier levels and closed higher following the company’s earnings report, as well as news the company was buying a private sales e-commerce company. Wall Street upgrades pushed several stocks higher, including Stanley Black & Decker ( SWK ), EOG Resources ( EOG ), and Raytheon ( RTN ). On the downside, fertilizer play CF Industries ( CF ) sold off after reporting better-than-expected results. Weight Watchers ( WTW ) also gave back just a smidgen of yesterday’s huge gains. The speculation in the venture capital space continues to rage on as we continue to hear about huge rounds of money being raised at ever-climbing market valuations. Mark Cuban just came out with some comments that echoed what I have been saying about the “game” that is going on, where eventually regular investors get burned with the usual late invitations to participate (post-IPO after the insiders have already cashed…

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Taiwan Semiconductor (TSM): Tech Turnaround

Filed in Bank Gold, economy, lead, o by on February 18, 2011 0 Comments
Taiwan Semiconductor (TSM): Tech Turnaround

Filed under: China , Newsletters , Stocks to Buy “Taiwan’s economy and its stock market should post solid growth in 2011; we also see warming relations between the island of Taiwan and mainland China,” suggests global specialist Yiannis Mostrous . The editor of The Silk Road Investor explains, “Technology should be a major beneficiary of these near-term themes and Taiwan Semiconductor Manufacturing ( TSM ) is our favorite stock for exposure to the technology turnaround. “Demand for notebook computers remains solid and mobile phones are expected to sell strongly during the Chinese New Year holiday this week, which will lead to inventory restocking. Continue reading Taiwan Semiconductor (TSM): Tech Turnaround Taiwan Semiconductor (TSM): Tech Turnaround originally appeared on BloggingStocks on Fri, 18 Feb 2011 13:00:00 EST. Please see our terms for use of feeds . Permalink | Email this | Comments

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EOG Resources’ Target, Estimates Boosted at Goldman Sachs (EOG)

Natural gas producer EOG Resources, Inc. ( EOG ) on Friday saw its price target and earnings estimates raised by analysts at Goldman Sachs. The firm maintained its “Buy” rating on EOG and boosted its price target from $117 to $121. That new target implies a 16% upside to the stock’s Thursday closing price of $104.22. Goldman also raised its earnings estimates for the company through 2013, following its better-than-expected fourth quarter earnings results. The analyst commented, “EOG remains a leader in developing horizontal resource plays, and the combination of superior liquids growth (28% expected CAGR 2011-14), superior cash-on-cash returns (13.7% 2011-14 avg) and exploration upside as reasons why EOG should not trade at a discounted EV/EBITDA multiple vs. peers.” EOG Resources shares rose $1.04, or +1%, in premarket trading Friday. The Bottom Line Shares of EOG Resources ( EOG ) have a .59% dividend yield, based on last night’s closing stock price of $104.22. The stock has technical support in the $95-$100 price area. If the shares can firm up, we see overhead resistance around the $110-$114 price levels. EOG Resources, Inc. ( EOG ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars. Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .

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Market Wrap-Up for Feb.17 (WTW, DPS, CLF, WMB, KO, LO, SJM, more)

Filed in AMAG, Apple, dividend, earnings, Ford, Gold, Gold Bullion prices, lead, o, shares by on February 17, 2011 0 Comments

It was an overall steady day for the markets, along with a decent number of dividend payouts coming over the wires. Earnings boosted several dividend names, but the biggest winner of the day was Weight Watchers ( WTW ) after the company just stunned analysts with the size of its 2011 earnings estimates. Shares of WTW rallied over $20 this morning on that news. Other earnings plays that had a good day included recently-recommended name Dr. Pepper Snapple Group ( DPS ). Cliffs Natural Resources ( CLF ) and J.M. Smucker Company ( SJM ) traded in the green as well following earnings results. Williams Co. ( WMB ) was up on news the company will be splitting in two. The company also announced a dividend boost. Late in the morning, beverage giant Coca-Cola ( KO ) announced a 7% increase in its dividend payout. Tobacco play Lorillard ( LO ) announced a 16% increase in its dividend payout to lift shares almost 2%. We had removed shares of Lorillard from our recommended list recently on concerns we have surrounding the coming FDA judgement/opinion on use of menthol in cigarettes, which accounts for the majority of Lorillard’s sales. I have to admit, I am a big fan of American Idol. My kids and I really enjoy the whole “dreams can come true” mindset for the contestants. Last night was another episode of “cut-downs” as singers needed to perform as part of groups. It’s always interesting to see the type of friction this can cause as egos are clashing everywhere you turn. What amazes me is that often times the individual performers that we thought were amazing on their own, begin to crumble when taken into a different situation. They lose sight of what needs to be done to get through to the next rounds. You see some completely unravel and throw the opportunity they had once cherished right down the drain. This phenomenon isn’t unlike the investing world in that many individuals know what needs to get done to build wealth, but for some reason or another, can not seize the moment. Whether it is just putting some extra coin to the side every month, spending some money to find quality research and investment ideas, or swallowing their pride when an investment idea doesn’t pan out, investors consistently make big mistakes. I know the market continues to move higher and some people may be waiting for a pullback. There is nothing wrong with doing so, but don’t skip your monthly investments you can be making because of that. There are plenty of good yield plays that you can still find to put money to work in, even after the nice run the market has had. Taking financial responsibility and knowing what you can afford to do is the key. I talk about investing in quality dividend-paying stocks as a great way to build up your future income, but if you are spending like there’s no tomorrow as well, then that is a risk that could eventually negate all the good you might be doing on the investment side. Saving is a mantra that needs to also be adopted…

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Will Android Capture First Place?

Filed in Apple, E Reader, Google, lead, o, South African Gold by on February 15, 2011 0 Comments
Will Android Capture First Place?

Filed under: Internet , Competitive Strategy , Google (GOOG) , Smartphones , Technology If we look back to the days of the search engine revolution, Google ( GOOG) built not only the most powerful search engine, but a business model based on that search engine that has made the company No. 1 in that category. The company is on the move again — and Google’s Android is leading the way. Google sees the next leg of the Internet revolution in the smart phone, tablet and e-reader market — and there’s already a fierce battle raging. Google’s Android is making inroads into the iPhone turf. How deep is the penetration? Singapore research firm Canalys said, ” Google shipped twice as many devices as Apple’s iPhone. in the fourth quarter,” capturing 33% of shipments, up from 8.7% a year ago. Continue reading Will Android Capture First Place? Will Android Capture First Place? originally appeared on BloggingStocks on Tue, 15 Feb 2011 10:00:00 EST. Please see our terms for use of feeds . Permalink | Email this | Comments

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Sysco Confirms Our Worst Fears

Filed in AMAG, BP, GOld juniors, Gold Market, HAL, inflation, lead, Lear, o, target by on February 14, 2011 0 Comments

The food inflation strategies we outlined here and here and here may have sounded a bit gloomy, but considering what’s been happening in the commodity markets (inflation, weather-related disasters, and freezing conditions in Mexico), the well-timed strategies remain in place. ———————— Now that Sysco has confirmed their prices are rocketing (which also means your food prices will head north), it’s about to get a lot worse for the millions already struggling to pay their outrageous food bills… According to reports, you’ll pay double… even triple the price for produce within weeks thanks to a freeze that wiped out crops in Mexico and the southwestern US. And, according to Zero Hedge, “Now might be a good time to hit the frozen foods (or fresh produce if you’ve got a vacuum sealer) aisle at your local grocery store and stock up on your favorite fruits and veggies, as there may be a severe supply crunch coming in the next couple weeks lasting perhaps several months.” “Why pay premium prices later when you can prepare yourself today, before the rest of the country gets wind of it,” says Zero Hedge, as inflationary risks, supply problems, weather related incidents, and a recent freeze in Mexico that’s lead to an 80% and 100% crop damage makes life a bit more unbearable for companies that Sysco, which just released the following note: ALL OF OUR GROWERS HAVE INVOKED THE ACT OF GOD CLAUSE ON OUR CONTRACTS DUE TO THE FOLLOWING RELEASE. WE WILL BE CONTACTING YOU PERSONALLY TO REVIEW HOW THIS WILL AFFECT OUR CONTRACTED ITEMS WITH YOU GOING FORWARD. THE DEVASTATING FREEZE IN MEXICO IS WORST FREEZE IN OVER 50 YEARS… THE EXTREME FREEZING TEMPERATURES HIT A VERY BROAD SECTION OF MAJOR GROWING REGIONS IN MEXICO, FROM HERMOSILLO IN THE NORTH ALL THE WAY SOUTH TO LOS MOCHIS AND EVEN SOUTH OF CULIACAN. THE EARLY REPORTS ARE STILL COMING IN BUT MOST ARE SHOWING LOSSES OF CROPS IN THE RANGE OF 80 TO 100%. EVEN SHADE HOUSE PRODUCT WAS HIT BY THE EXTREMELY COLD TEMPS. IT WILL TAKE 7-10 DAYS TO HAVE A CLEARER PICTURE FROM GROWERS AND FIELD SUPERVISORS, BUT THESE GROWING REGIONS HAVEN’T HAD COLD LIKE THIS IN OVER A HALF CENTURY. THIS TIME OF YEAR, MEXICO SUPPLIES A SIGNIFICANT PERCENT OF NORTH AMERICA’S ROW CROP VEGETABLES SUCH AS: GREEN BEANS, EGGPLANT, CUCUMBERS, SQUASH, PEPPERS, ASPARAGUS, AND ROUND AND ROMA TOMATOES. FLORIDA NORMALLY IS A MAJOR SUPPLIER FOR THESE ITEMS AS WELL BUT THEY HAVE ALREADY BEEN STRUCK WITH SEVERE FREEZE DAMAGE IN DECEMBER AND JANUARY AND UP UNTIL NOW HAVE HAD TO PURCHASE PRODUCT OUT OF MEXICO TO FILL THEIR COMMITMENTS, THAT IS NO LONGER AND OPTION. WITH THE SERIES OF WEATHER DISASTERS THAT HAS OCCURRED IN BOTH OF THESE MAJOR GROWING AREAS WE WILL EXPERIENCE IMMEDIATE VOLATILE PRICES, EXPECTED LIMITED AVAILABILITY, AND MEDIOCRE QUALITY AT BEST. THIS WILL NOT ONLY HAVE AN IMMEDIATE…

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How Gold Could Save America from Nazi Theory

Keynesian economics is the root of economic problems for most countries around the world today. So it’s important to understand both what Keynesian economics stands for and what the opposing brand of economic thinking called Classical economics maintains. In a nutshell… Classical Economics: Keynesian Economics: Thrift, hard work, and productivity are virtues. The classical gold standard restrains the state from inflating and provides a stable monetary environment in which the economy can flourish. Government should strive for balanced budgets and fiscal responsibility. The state should adopt a general policy of laissez-faire of non-interventionism in economic affairs: low taxes, free trade, and minimal bureaucracy. Production is more important than consumption. Say’s Law: Supply is more important than demand since supply of one good creates the demand for another. An increase in savings can contract income and reduce economic growth. Consumption is more important than production, thus turning Say’s Law upside down. There is no need for a gold standard; fiat currency is preferable. Demand is more important than supply. Teaches that governments and politicians can be trusted. It’s no wonder politicians love Keynesian economics over Classical economics. To control the economy, most governments around the world have been using Keynesian economics for the past 75 years. It is the only economic thought that is taught in the schools and universities. “They” want us to believe they are wise and intelligent souls who know what is best for us. But nothing could be further from the truth throughout most of economic history… Read this quote from Adolf Hitler, who openly embraced Keynesian ideas: Gold is not necessary. I have no interest in gold. We will build a solid state, without an ounce of gold behind it. Anyone who sells above the set prices, let him be marched off to a concentration camp. That’s the bastion of money. The Nazis’ economic success when Hitler first came into power was a result of Hitler cooking the books. The rest of his time in power goes down in history as one of the worst atrocities in the history of mankind. Only two other twisted power-seeking devils in the annals of time are responsible for the killing of more people than Hitler &mdash…

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Market Wrap-Up for Feb.9 (RL, DIS, AGU, IR, CSC, NYX, NOK, AAPL, more)

Federal Reserve Chairman Ben Bernanke was on the hot seat today as he gave his annual Washington presentations. With the markets being significantly higher than they were this time last year, he was certainly feeling better about some of the recent data. Some of his statements pointed to increased evidence that a self-sustaining recovery in consumer and business spending may be taking hold. Also, real consumer spending rose at an annual rate of more than 4 percent in the fourth quarter. There is no question that we have been seeing economic stabilization, and the markets have certainly been pricing stocks as if the lift can be sustained. We actually made some ratings changes this morning, removing four names from our recommended list. We continue to see opportunities in the market, but we are also aware that some names may just not have the risk/reward profile we are searching for, so we need to make changes when we see fit. You can check out the post if you did not read the e-mail alert we sent out to Dividend.com Premium members earlier. The markets were moving sideways early on, but some sellers did show up in certain areas, especially the commodity names. Earnings were in play today with buyers jumping at positive news from Polo Ralph Lauren ( RL ), Walt Disney ( DIS ), Syngenta ( SYT ) and Agrium ( AGU ). On the flip side, it wasn’t a great day for shares of Computer Sciences ( CSC ) or Ingersoll-Rand ( IR ) following both companies’ less-than-stellar results. Also, shares of NYSE Euronext ( NYX ) were halted for some time, but then popped higher when the stock was released for trading on reports the exchange was involved in merger talks with the Deutsche Börse. Interesting story making the rounds this morning about Nokia’s ( NOK ) CEO sending out a reality check memo overnight to everyone in the company. The memo details how the company has lost its way, with rivals Apple ( AAPL ) and Google ( GOOG ) eating their lunch. It’s a real admission that change needs to happen quickly or the company’s future could quickly dim further. I couldn’t help but think of how this relates to the many people that still today have not taken the financial steps to safeguard their later years (whether you are 5,10,20,or 30 …

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Oil Services Favorites: Schlumberger, National Oilwell Varco

Filed in Bank Gold, commodities, economy, lead, o by on February 9, 2011 0 Comments
Oil Services Favorites: Schlumberger, National Oilwell Varco

Filed under: Newsletters , Schlumberger Limited (SLB) , Commodities , Oil , Stocks to Buy “Oil had a good year in 2010, rising 15 percent, and 2011 looks to be even better, as a stronger global economy pushes demand for resources higher,” says Stephen Leeb . The editor of The Complete Investor explains, “Oil service and equipment companies are the most leveraged way to play rising oil prices. Here’s a look a Schlumberger ( SLB ) and National Oilwell Varco ( NOV ). “First is Schlumberger, operating in more than 80 countries. The company is the world’s leading supplier of energy technology, project management, and information solutions. Continue reading Oil Services Favorites: Schlumberger, National Oilwell Varco Oil Services Favorites: Schlumberger, National Oilwell Varco originally appeared on BloggingStocks on Wed, 09 Feb 2011 12:40:00 EST. Please see our terms for use of feeds . Permalink | Email this | Comments

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A Self-Employed Carpenter’s Thoughts on the Future

The world is changing. Currently, as a nation, we have a large and well-trained section of our work force dedicated to residential construction. Unemployment within the construction industry now exceeds 20%. That number takes into account only workers getting unemployment compensation. There are also many self-employed individuals, ineligible for unemployment compensation, who have simply run out of customers and work. That is the bad news. Now the worse news: Not only are those jobs not coming back, but the construction industry will continue to diminish for the foreseeable future. The real estate glut is not on hold; it is over. Waiting for its return is similar to waiting for next the big surge in typewriters, 35mm cameras, and home phones. Why are the construction jobs not coming back? There are three main reasons, the first of which is inflation. Decades of credit expansion and the recent printing of money (quantitative easing) have increased the overall volume of our fiat currency: dollars. Therefore, the value of each dollar unit has been reduced, causing prices to rise. This results in increased costs in construction of new homes. Higher new construction costs make staying in and repairing older structures, or renting, more attractive. The second reason is fuel costs. Living rurally and working in urban areas is becoming very expensive. Reasons one and two will keep an increasing number of younger workers and couples living and renting closer to work. Why take the financial and mobility risks associated with homeownership? The third reason is we are broke. Who are “we”? Western civilization, comprised mainly of the U.S. and Europe. Consider this…there are gold and silver coins and bullion: actual wealth storage vehicles. There are paper dollars: temporary wealth storage vehicles. And there are also trillions of “dollars” represented as pixels on screens in accounting software programs. When I say that we are broke it is because I don’t believe those pixel dollars represent anything. All of the wealth supposedly held in those pixels does not exist. It is a classic Ponzi scheme. If you go today and convert your pixels to actual dollars, everything is just fine. But if 10% of us go today and try to convert our pixels into dollars, the banks will shut down…Why? Because the money doesn’t exist. There is no actual wealth stored in any of those pixels. Spain and Portugal may require financial bailouts in 2011. Part of the fallout from the Greek financial crisis last year was the creation of a eurozone bailout fund of $1.01 trillion. That fund could be used to assist Spain and Portugal if necessary. Where did that $1.01 trillion come from? Was it removed from another sector of Europe’s economy? Supplied in gold bullion to EU headquarters in The Hague? Removed from the savings accounts of earnest Europeans? No, none of those could supply …

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Market Wrap-Up for Feb.8 (MCD, CL, AET, CLX, AVP, more)

The second interest rate hike in China in less than a month is being digested by Wall Street right now with a ho-hum reaction this morning. At some point the market will begin paying a bit more attention. With numerous M&A deals still being announced, and IPOs lining up on the runway, we’re not sure when the buying streak will begin to ease up, but we are carefully examining possible scenarios. Gold prices seem to be perking up today, as the last four months have been nothing but sideways action. At some point soon, we will see either a coiled spring effect and higher prices, or impatient investors heading for the exits. Elsewhere in the markets, shares of McDonald’s ( MCD ) got a nice boost from solid January sales. Colgate-Palmolive ( CL ) was also rallying on some takeover rumblings. Aetna ( AET ) and Clorox ( CLX ) had some decent buying following positive analyst comments. Avon Products ( AVP ) went in the opposite direction following lackluster earnings results. I was reading numerous accounts of AOL’s acquisition of the popular news site The Huffington Post yesterday. I tend to pay attention to what is happening in the web media space closely, as our firm is often grouped into that space, since “.com” is part of our brand. You have to question the uncanny love that is expressed for the deal, with the word “innovation” being tossed around in seemingly every other compliment. Sorry, but what is innovative about having 6000 contributors writing free content for your website, as Ms. Huffington managed to achieve? The company does only have 200 employees and can be described as lean and mean, but innovative? I’ve also seen a lot of insults leveled toward “old media” (newspapers, magazines) regarding their new goals of putting up so-called “pay walls” (which just means you charge users to access your content). If I were running the New York Times or any other major paper, I would’ve put some sort of pay wall up years ago. Why charge for a print version and give it away online for free! The lack of vision has costs thousands and thousands of jobs in the newspaper and magazine industries. Some people may say “who cares, it’s free now, I can get the same information anywhere on the web.” I don’t know about you, but reading articles created by content farms that pay writers $3 a post (if that) isn’t exactly very appealing. Unfortunately, that’s the direction that many online media plays are heading. I am not going to knock Arianna Huffington and her major payday, but at the end of the day, it wasn’t so much about innovation, as it …

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