How did your stocks do today? Did they follow the general path lower, or were you one of the enlightened who was smart enough - or lucky enough - to buy the right stocks at the right time. From an investment point-of-view, today was a good day to buy. Always buy on down days and sell on up days, if you can.
That's how the stock market works - in reverse. You almost have to be counter-counter intuitive to make money trading stocks, although, if you have enough dough, like Warren Buffett, for instance, you buy whole companies, or at least significant enough stakes in those companies that you get a seat on the board and have a say in how the company is actually run.
Buffett's management style is pretty hands-off, unless the man wants something specific. He's a smart, seasoned buyer of companies, putting his money to work at firms which meet his strict criteria. Low profit margins? Out. Unproven technology? Out. Inexperienced management team? Out. We should all be so disciplined and successful, but we're not, mostly because we require more bang for our bucks. Trying to make money with a billion dollars is a lot easier than making good lettuce with $100,000.
Most people have some money in speculative ventures, more in "safe" investments, and probably very little in dividend-producing companies, which are usually the best of breed, by the way. Buffett's companies all return dividends. That used to be the mantra. Now it's "trading, playing and going all in." Wall Street has the little guy by the short hairs, but not old, wise Warren. That's why he's rich and you're not.
Anyway, stocks were off their gains today, putting to rest a swell winning streak on the S&P (5 days? 6? Who cares?)
Dow 10,626.43, -37.56 (0.35%)
NASDAQ 2,282.31, -30.10 (1.30%)
S&P 500 1,136.18, -10.80 (0.94%)
NYSE Composite 7,370.48, -78.57 (1.05%)
Losers beat winners, 4795-1728, almost 3:1, so if you're one of the regular folk, you probably got beaten down today. Doesn't feel very good, does it? If that money was in cash, you'd still have it all. But, you want to play the market, so speculate away and watch your kid's college fund or your own retirement saunter off further into the distance.
There were 299 new highs and just 36 new lows. I've been saying that the highs were close to topping out, and yesterday, they did, with over 900 issues making new tops. Looks like we're in for a downhill ride from here. Watch what happens this earnings season. Money will be heading out of stocks either just before they release their 4th quarter and full year data, or directly afterwards. Whether their reports are good or bad, big money will be looking to lock in profits. Stocks, over the next three weeks in particular, are not going to be good investments.
NYSE Volume 5,231,147,500
NASDAQ Volume 2,268,025,250
This is a great time to be in gold or silver, as is any time. Here's a question? How much of your portfolio is in actual gold or silver? Not an EFT - those are for suckers - but actual phycial gold and/or silver coins, bars, high-end jewelry that can be easily converted to cash at a moment's notice. 25%, 15%, 10%, none? Most people have less than 1% in physical precious metals, and that's a real shame, because, well, gold's up something like 400% in the past 6 years and silver has appreciated nicely as well.
There's a reason for that. It's because paper money and stocks are sometimes worth less today than yesterday. As far as commodities are concerned, gold fell $22.00, to $1,129.30, while silver dropped 34 cents, to $18.36. Oil slipped $1.73, to $80.79. It's still overpriced. But gold and silver just seem to keep going higher. If investors ever get a whiff of inflation (there isn't any, right now), silver is likely to double in two year's time. Gold will probably do as well if not better. People love gold, and there isn't much of it around.
Getting to the title of this post, when is a penny worth 2 cents?
The answer is pretty simple: When the penny in question was minted between 1909 and 1982 (with the exception of 1943, when steel was used in place of copper) and copper is priced above $3.10/pound (rough estimate). Right now, pennies from those dates (95% copper) are worth 2.2 cents in melt value. So, if you can find somebody who will pay you fair value, you can double your money on your old pennies. You can check on how much old pennies are worth here. And if your pennies happen to be from prior to 1959, they're called "wheaties" after the wheat stamping on the backs, before we started putting an image of the Lincoln Memorial on the back of pennies. They're worth even more, because people like and collect them.
You can get an idea of what "wheaties" are worth, here. Expect those prices to rise.
So, if somebody mentions the old adage, a penny saved is a penny earned, you can smile wryly, knowing that it's now 2 cents, and maybe more.
Tuesday, January 12, 2010
Monday, January 11, 2010
This is getting a little bit old, isn't it?
Stocks were generally up today, though the NASDAQ was down. So what? Are you richer, poorer, or just think you are?
I've been posting here almost every business day for more than 3 years and stocks have gone up, down and sideways without much to do with underlying fundamentals, or charts, or anything other than buyer and seller sentiment. I've come to some conclusions, most of which point up the futility of trading in stocks. After all, you are buying into something over which you have no control - unless you're on the BOD - and subject to the whims of the market, general sentiment, the perception of analysts and all sorts of other outside influences.
What are stocks, really? Just pieces of paper, as the renowned Jim Cramer might say. It's worse than that, really. They are electonic bits and bytes. The little numbers you see in your investment accounts are electrons, protons, neutrons. You really don't own anything. You just think you do.
From my perspective, there really isn't anything you should want to own other than hard assets - real estate, gold, silver, art, rarities, currency, automobiles, articles of known value and clothing. Everything else, unless it is being put to use as a business, is pretty much without much value.
Most people these days don't know a thing about money and how to use it properly. Many people actually believe in a system that works, with a government that cares about our well-being and proper values for everything. If the events of the past 24 months or thereabout have taught anybody anything, it should have been a lesson how the federal government and Wall Street are in cahoots to preserve each other's wealth and best interests, not those of the ordinary citizen, and, as such, neither should be trusted, and further, the stocks they are selling are not to be trusted as reliable investments, either.
The current economies of the nations - great and small - are such that they could be whisked away in an instant and entire peoples thrust into despair. Currencies fluctuate; stocks and bonds go up and down. Is this as it should be? I think not. There should be more stability in our economy, though despite the efforts of the investment world, the mainstream media and the federal government to have us believe that our system is sound, and stable, it is far from it.
I may go on posting every day, maybe even more often than just once a day, but I am not going to talk about stocks to any great extent in the future. Instead, I'll be focusing this blog on more practical applications of what to do with your money other than to buy and sell electronic representations of shares of company X, Y or Z. Your (and mine) financial future is at risk. It is up to all of us to devise a better system.
Dow 10,663.99, +45.80 (0.43%)
NASDAQ 2,312.41, -4.76 (0.21%)
S&P 500 1,146.98, +2.00 (0.17%)
NYSE Composite 7,449.05, +23.70 (0.32%)
Gold gained $12.80, to $1,151.70. Silver was up another 23 cents, to $18.70. Gold and silver are actual commodities you can own and keep. Their prices, and the way they've been rising over the past 10 years, is telling you something. Listen carefully and you can here them say, "we are safe. We are real money, not fiat paper."
NYSE Volume 4,741,295,500
NASDAQ Volume 2,088,954,250
Tomorrow, and in days ahead, we'll focus more on actual wealth and how to build it, rather than on the nuanced reproductions of it which Wall Street sells.
One last thought: Stock gains are taxable, and at varying rates. Ask yourself if that's right. When you make money with your money, you pay taxes on the gains. Should not the government give back when you lose?
It's a grand scam and ordinary people need not be involved in it.
I've been posting here almost every business day for more than 3 years and stocks have gone up, down and sideways without much to do with underlying fundamentals, or charts, or anything other than buyer and seller sentiment. I've come to some conclusions, most of which point up the futility of trading in stocks. After all, you are buying into something over which you have no control - unless you're on the BOD - and subject to the whims of the market, general sentiment, the perception of analysts and all sorts of other outside influences.
What are stocks, really? Just pieces of paper, as the renowned Jim Cramer might say. It's worse than that, really. They are electonic bits and bytes. The little numbers you see in your investment accounts are electrons, protons, neutrons. You really don't own anything. You just think you do.
From my perspective, there really isn't anything you should want to own other than hard assets - real estate, gold, silver, art, rarities, currency, automobiles, articles of known value and clothing. Everything else, unless it is being put to use as a business, is pretty much without much value.
Most people these days don't know a thing about money and how to use it properly. Many people actually believe in a system that works, with a government that cares about our well-being and proper values for everything. If the events of the past 24 months or thereabout have taught anybody anything, it should have been a lesson how the federal government and Wall Street are in cahoots to preserve each other's wealth and best interests, not those of the ordinary citizen, and, as such, neither should be trusted, and further, the stocks they are selling are not to be trusted as reliable investments, either.
The current economies of the nations - great and small - are such that they could be whisked away in an instant and entire peoples thrust into despair. Currencies fluctuate; stocks and bonds go up and down. Is this as it should be? I think not. There should be more stability in our economy, though despite the efforts of the investment world, the mainstream media and the federal government to have us believe that our system is sound, and stable, it is far from it.
I may go on posting every day, maybe even more often than just once a day, but I am not going to talk about stocks to any great extent in the future. Instead, I'll be focusing this blog on more practical applications of what to do with your money other than to buy and sell electronic representations of shares of company X, Y or Z. Your (and mine) financial future is at risk. It is up to all of us to devise a better system.
Dow 10,663.99, +45.80 (0.43%)
NASDAQ 2,312.41, -4.76 (0.21%)
S&P 500 1,146.98, +2.00 (0.17%)
NYSE Composite 7,449.05, +23.70 (0.32%)
Gold gained $12.80, to $1,151.70. Silver was up another 23 cents, to $18.70. Gold and silver are actual commodities you can own and keep. Their prices, and the way they've been rising over the past 10 years, is telling you something. Listen carefully and you can here them say, "we are safe. We are real money, not fiat paper."
NYSE Volume 4,741,295,500
NASDAQ Volume 2,088,954,250
Tomorrow, and in days ahead, we'll focus more on actual wealth and how to build it, rather than on the nuanced reproductions of it which Wall Street sells.
One last thought: Stock gains are taxable, and at varying rates. Ask yourself if that's right. When you make money with your money, you pay taxes on the gains. Should not the government give back when you lose?
It's a grand scam and ordinary people need not be involved in it.
Friday, January 8, 2010
Poor Employment Picture Doesn't Faze Wall Street
The highly-anticipated December Non-farms payroll report, issued by the Commerce Department prior to the opening bell, didn't have much of an effect on the overall tone of trading in the final day of the first week of 2010. The report showed a loss of 85,000 jobs for the month, far worse than expected, but traders seemed unmoved and the major indices, while trending lower most of the session, still managed to post small gains, primarily due to the weaker dollar.
As has been the case for the past 10 months, stocks just keep going up, no matter the news. Analysts and professionals seem to be able to twist any data into positive signs of recovery, just the kind of attitude tha leads to bubble-like markets, over-bought conditions and stock which have multiples that are based more on fiction than the reality of fundamental analysis.
Using the stock indices as yardsticks, one would believe that we're 60% better than we were a year ago. At the very least, that stocks are worth 60% more, or will be. One can only imagine the short positions being taken up by the truly savvy players in anticipation of what are likely to be shaky 4th quarter reports from a slew of companies over the next two to three weeks.
It should be a spectacle worth witnessing.
Dow 10,618.19, +11.33 (0.11%)
NASDAQ 2,317.17, +17.12 (0.74%)
S&P 500 1,144.98, +3.29 (0.29%)
NYSE Composite 7,425.35, +31.42 (0.42%)
Advancing issues led decliners, 4059-2409, the margin building through the week to its best level on Friday. New highs were achieved by 697 stocks, with only 80 making new lows. Volume moderated a bit from the previous two sessions, but remained solid. Those chasing performance may have taken a wait-and-see approach and an early exit for the weekend.
NYSE Volume 4,872,173,500
NASDAQ Volume 2,163,779,500
The commodity markets lollygagged through the day. Crude oil gained all of 9 cents, to $82.75 per barrel. With the weaker dollar underpinning trades, gold rose $5.50, to $1,139.20. Silver continued its ascent, gaining 12 cents, to $18.46. The speculation in natural gas seems to have gone to its limit, near term, with that commodity losing 5 cents, to $5.71/mmbtu.
For the week, stocks trended higher, though Friday's finish was suspect, with almost all of the action commencing in a frantic final half hour. Most of the progress for the week was made on Monday, when traders kicked off 2010 with the best gains.
Alcoa kicks off earnings season on Monday, though one company's results are unlikely to move markets dramatically.
As has been the case for the past 10 months, stocks just keep going up, no matter the news. Analysts and professionals seem to be able to twist any data into positive signs of recovery, just the kind of attitude tha leads to bubble-like markets, over-bought conditions and stock which have multiples that are based more on fiction than the reality of fundamental analysis.
Using the stock indices as yardsticks, one would believe that we're 60% better than we were a year ago. At the very least, that stocks are worth 60% more, or will be. One can only imagine the short positions being taken up by the truly savvy players in anticipation of what are likely to be shaky 4th quarter reports from a slew of companies over the next two to three weeks.
It should be a spectacle worth witnessing.
Dow 10,618.19, +11.33 (0.11%)
NASDAQ 2,317.17, +17.12 (0.74%)
S&P 500 1,144.98, +3.29 (0.29%)
NYSE Composite 7,425.35, +31.42 (0.42%)
Advancing issues led decliners, 4059-2409, the margin building through the week to its best level on Friday. New highs were achieved by 697 stocks, with only 80 making new lows. Volume moderated a bit from the previous two sessions, but remained solid. Those chasing performance may have taken a wait-and-see approach and an early exit for the weekend.
NYSE Volume 4,872,173,500
NASDAQ Volume 2,163,779,500
The commodity markets lollygagged through the day. Crude oil gained all of 9 cents, to $82.75 per barrel. With the weaker dollar underpinning trades, gold rose $5.50, to $1,139.20. Silver continued its ascent, gaining 12 cents, to $18.46. The speculation in natural gas seems to have gone to its limit, near term, with that commodity losing 5 cents, to $5.71/mmbtu.
For the week, stocks trended higher, though Friday's finish was suspect, with almost all of the action commencing in a frantic final half hour. Most of the progress for the week was made on Monday, when traders kicked off 2010 with the best gains.
Alcoa kicks off earnings season on Monday, though one company's results are unlikely to move markets dramatically.
Thursday, January 7, 2010
Payrolls on the Mind
Stocks traded sideways most of the session, though the NASDAQ spent the entire day in negative territory, finishing lower y a point. Once again, there was little to no motivation to buy stocks, though the majors all posted gains. Investors are still awaiting Friday's non-farm payroll data.
Initial unemployment claims came in 484,000, which was one thousand more than last week, so there's no movement in that department. Jobs may be more scarce in some areas and for different ethnic and age strata, but there's no lack of money anywhere. Cash, currencies and currency equivalents are circulating at a steady pace, thanks to government stimulus efforts, but mostly to easy interest rates. That's why there is so much worry over rates and when the Fed decides to start raising them, because once they begin, they usually don't stop until they're around 5% on a 10-year note, or higher, depending on how much pent-up demand surfaces in real spending.
Dow 10,606.86, +33.18 (0.31%)
Nasdaq 2,300.05, -1.04 (0.05%)
S&P 500 1,141.69, +4.55 (0.40%)
NYSE Composite 7,393.93, +16.23 (0.22%)
Advancing issues finished far ahead of decliners, 3864-2684, and new highs beat new lows, 584-68. Volume was again on on the high side of moderate. From the volume today and the preceding two, it's become apparent that some strong positions are being filled. Tomorrow's employment number may have almost no net effect on stocks at this level, unless, of course, it's a disappointing one.
NYSE Volume 5,869,563,500
Nasdaq Volume 2,302,742,000
Commodities took a breather from their breakneck gains, except for silver, which continues to be on fire. Copper prices have also been on the rise, though lower today. Oil was off 52 cents, to $82.66. Gold lost $2.90, to $1,133.60. The aforementioned silver: up 18 cents, to $18.35. Silver is close to 18-month highs, though considering the 2009 move in gold, has some catching up to do.
Tomorrow, the wait is over. The government can announce a loss of 45,000 or so jobs and we'll go back to work, or sleep. The market has been very quiet of late, which may be the best thing that could happen.
Initial unemployment claims came in 484,000, which was one thousand more than last week, so there's no movement in that department. Jobs may be more scarce in some areas and for different ethnic and age strata, but there's no lack of money anywhere. Cash, currencies and currency equivalents are circulating at a steady pace, thanks to government stimulus efforts, but mostly to easy interest rates. That's why there is so much worry over rates and when the Fed decides to start raising them, because once they begin, they usually don't stop until they're around 5% on a 10-year note, or higher, depending on how much pent-up demand surfaces in real spending.
Dow 10,606.86, +33.18 (0.31%)
Nasdaq 2,300.05, -1.04 (0.05%)
S&P 500 1,141.69, +4.55 (0.40%)
NYSE Composite 7,393.93, +16.23 (0.22%)
Advancing issues finished far ahead of decliners, 3864-2684, and new highs beat new lows, 584-68. Volume was again on on the high side of moderate. From the volume today and the preceding two, it's become apparent that some strong positions are being filled. Tomorrow's employment number may have almost no net effect on stocks at this level, unless, of course, it's a disappointing one.
NYSE Volume 5,869,563,500
Nasdaq Volume 2,302,742,000
Commodities took a breather from their breakneck gains, except for silver, which continues to be on fire. Copper prices have also been on the rise, though lower today. Oil was off 52 cents, to $82.66. Gold lost $2.90, to $1,133.60. The aforementioned silver: up 18 cents, to $18.35. Silver is close to 18-month highs, though considering the 2009 move in gold, has some catching up to do.
Tomorrow, the wait is over. The government can announce a loss of 45,000 or so jobs and we'll go back to work, or sleep. The market has been very quiet of late, which may be the best thing that could happen.
Wednesday, January 6, 2010
Investors Awaiting Friday Jobs Data; Markets Churn
Another day passed on Wall Street with little or no movement in the major indices. Topping the outlook was anticipation of December Non-farm Payroll data, due out Friday morning, January 8, prior to the opening bell. A glimpse of what the numbers may look like was provided by the monthly private payroll report by ADP, which showed employers shedding another 84,000 jobs during December, a figure much improved over November's -145,000.
Considering that November Non-farm payrolls came in at the best levels in 16 months, showing a loss of only 11,000 jobs, the ADP report should have been reassuring to anyone looking for a better employment picture on Friday. Expectations are that the government will show a loss of between 25,000 and 45,000 jobs, though estimates are ranging even into positive territory. Much depends on prior month revisions, and also the method by which the december figures are compiled.
Some private sources contend that the government figures are fudged for political purposes, which would not be beyond imagination, while others point out that the raw numbers do not include the hordes of workers who have exhausted unemployment benefits and are no longer counted. True unemployment, including distressed workers, is estimated to be closer to 18% than the 10% with which the government has been flirting.
In any case, traders seemed tenuous with stocks trading in narrow ranges for the second straight day. While the NASDAQ finished in the red, the other major indices all posted positive numbers, though their gains were marginal, at best.
Dow 10,573.68, +1.66 (0.02%)
Nasdaq 2,301.09, -7.62 (0.33%)
S&P 500 1,137.14, +0.62 (0.05%)
NYSE Composite 7,377.70, +22.83 (0.31%)
Gainers edged out losers on the day, by roughly the same margin as Tuesday, 3548-2965. Once more, new highs seemed to be topping out, with 798 stocks reaching 52-week highs, while only 73 made new lows. Volume was solid again, though considering how little movement there was, churning was the operative word to describe the session. People are still waiting for unemployment data and further out, earnings reports.
NYSE Volume 5,517,178,000
Nasdaq Volume 2,269,902,500
Commodity prices were sharply higher, as oil reached another 15-month peak, gaining $1.41, to $83.18 per barrel. Gold soared another $18.30, to $1,137.00, while silver bounded ahead another 38 cents, to $18.18.
The signal coming from commodity traders is that of recovery and inflation, though equity participants are being cautious on the same news, figuring that those two economic elements will force the Fed to raise rates sooner, rather than later. The widespread consensus is that any rate hikes before June will kill off the rally, now in it's 10th month.
Considering that November Non-farm payrolls came in at the best levels in 16 months, showing a loss of only 11,000 jobs, the ADP report should have been reassuring to anyone looking for a better employment picture on Friday. Expectations are that the government will show a loss of between 25,000 and 45,000 jobs, though estimates are ranging even into positive territory. Much depends on prior month revisions, and also the method by which the december figures are compiled.
Some private sources contend that the government figures are fudged for political purposes, which would not be beyond imagination, while others point out that the raw numbers do not include the hordes of workers who have exhausted unemployment benefits and are no longer counted. True unemployment, including distressed workers, is estimated to be closer to 18% than the 10% with which the government has been flirting.
In any case, traders seemed tenuous with stocks trading in narrow ranges for the second straight day. While the NASDAQ finished in the red, the other major indices all posted positive numbers, though their gains were marginal, at best.
Dow 10,573.68, +1.66 (0.02%)
Nasdaq 2,301.09, -7.62 (0.33%)
S&P 500 1,137.14, +0.62 (0.05%)
NYSE Composite 7,377.70, +22.83 (0.31%)
Gainers edged out losers on the day, by roughly the same margin as Tuesday, 3548-2965. Once more, new highs seemed to be topping out, with 798 stocks reaching 52-week highs, while only 73 made new lows. Volume was solid again, though considering how little movement there was, churning was the operative word to describe the session. People are still waiting for unemployment data and further out, earnings reports.
NYSE Volume 5,517,178,000
Nasdaq Volume 2,269,902,500
Commodity prices were sharply higher, as oil reached another 15-month peak, gaining $1.41, to $83.18 per barrel. Gold soared another $18.30, to $1,137.00, while silver bounded ahead another 38 cents, to $18.18.
The signal coming from commodity traders is that of recovery and inflation, though equity participants are being cautious on the same news, figuring that those two economic elements will force the Fed to raise rates sooner, rather than later. The widespread consensus is that any rate hikes before June will kill off the rally, now in it's 10th month.
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