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Sunday, July 30, 2006
Dr. Weiss's Stock Market Recommendations: Sell These Stocks Now
From the Weekend Edition of Money and Marketsby Weiss Research, Inc. Martin here with an urgent update on stocks that are getting killed right now and what you should do about it.
Just this week, for example, Countrywide Financial, a major mortgage lender, fell out of bed.
Meanwhile, Fannie Mae, the worlds most indebted mortgage company, has seen its share price plummet nearly 16% in four months.
Investors are losing still another fortune in the shares of Toll Brothers, a high-end home builder, already down a whopping 32% ... and in Centex, another housing player down 15% just since May 8.
Many U.S. technology stocks are also getting killed, just as Tony Sagami has been warning you. The main reason: With higher interest rates and stagnant home values, homeowners cant tap their home equity any more to buy electronic goodies like they used to.
Take Dell Computer, for example. It was selling for $41 one year ago, $33 just three months ago, and now its selling for about $21 per share.
The declines in all of these stocks are taking place right now. And they are continuing whether the Dow is up or down. Regardless of what happens in the broad market, these sectors are in their own, private bear market.
What to Do Immediately ...My First Recommendation: With the housing market crumbling and interest rates already pounding these sectors, now more than ever before make sure you keep a big chunk of your money in safe investments. My favorite vehicle: Short-term Treasuries or money market funds specialized in Treasuries.My Second Recommendation: If you own the natural resource stocks weve been recommending, stick with them. Unlike the vulnerable sectors Ive been telling you about here, stocks like these stand to benefit from the same forces that have driven interest rates higher rising natural resources and inflation. My Third Recommendation: If you still own shares in interest-sensitive sectors like mortgage lenders or home builders get rid of them immediately. Theyre destined to fall much further.My Fourth Recommendation: Sell U.S. tech stocks, especially those that cater mostly to consumers. Already, just since the beginning of April, the Nasdaq has fallen as much as 13%. More declines are coming . . . .This investment news is brought to you by Money and Markets. Money and Markets is a free daily investment newsletter from Martin D. Weiss and Weiss Research analysts offering the latest investing news and financial insights for the stock market, including tips and advice on investing in gold, energy and oil. Dr. Weiss is a leader in the fields of investing, interest rates, financial safety and economic forecasting. To view archives or subscribe, visit http://www.MoneyandMarkets.com
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Tuesday, July 25, 2006
See Internet Marketing Guru Mark Joyner on New Video Clip
Just a quick link for today that I think you all will enjoy. The guys at Nitro Marketing are launching a fascinating new product they created from a private $10k consultation they received from Mark Joyner. I just saw a great 20 minute online video clip from the eXtreme Business Makeover course that they made available here: Extreme Biz MakeoverI am sure you know Mark Joyners books (available at Amazon.com) on Internet marketing, and have heard of some of his great successes. Its fun edutainment to see him in action on this video. Watch the clip and see how much youll learn in 20 minutes. I did ... (and Im glad I did it!).
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Monday, July 24, 2006
Middle East Wars, Oil, Inflation, and Your Investments
Republished from the newletter Money and Markets
(with permission) by Weiss Research, Inc. Its very early Monday morning, and I just got back from a short walk outside.
South Floridas sunrise is still two hours away, and theres no moonlight. So its pitch black, difficult to see anything beyond a few feet ahead.
But 850 miles to the north-northeast, the darkness engulfing the Federal Reserve Board in Washington especially its Chairman, Ben Bernanke seems far greater.
Raging inflation is on his doorstep, but he cant see it. The numbers are staring him in the face, but he refuses to acknowledge the dangers.
This is not a new phenomenon. We saw the same blindness afflict Fed Chairman Arthur F. Burns in the early 1970s. And we saw it again in Fed Chairman G. William Miller in the late 1970s.
Both men presided over massive increases in money supply and big declines in the U.S. dollar. Both ignored the obvious signs of inflation until it was too late. Now, Fed Chairman Bernanke is doing the same, paying no attention to history.
Perhaps no one has shown him this chart of surging commodity prices.
The chart demonstrates unambiguously and without bias that the next wave of inflation could be among the biggest of all.
In particular, three waves of price surges stand out vividly:
1. In the early 1970s, the Reuters CRB Index, representing a broad range of commodities, doubled from an index of 100 to around 200.
The primary cause: Energy prices going through the roof.
The consequence: Soaring inflation.
2. In the late 1970s, commodity prices jumped again, this time from the 200 level to about 330.
The primary cause: Energy prices going through the roof.
The consequence: Soaring inflation.
3. Now its happening all over again, but much worse.
The latest rise in commodity prices is even greater than the two surges of the 1970s: The Reuters CRB Index has more than doubled, from 186 at the end of October of 2001 to 386 at the end of last month.
The primary cause: Energy prices going through the roof!
The likely consequence: Soaring inflation!
And thats based exclusively on the commodity price rises weve witness so far.
It does not take into consideration the new surges that are still in the making, driven by the rampant demand from China and India.
Nor does it consider the elephant in the room ...
The Next Big Wave of War
Just five years ago, there were no wars in the oil-rich Persian Gulf or the Middle East. Nor were there any wars in nearby regions that could impact them. None.
Now, there are four:War #1. Afghanistan, heating up dramatically in recent months, with a major resurgence of the Taliban.War #2. Iraq, sinking rapidly into a full-scale civil war, now claiming at least 100 lives each day.War #3. Gaza and West Bank, suddenly transformed from a low-level rebellion into an all-out conflict.War #4. Lebanon, just startingto explode, with shocking new surprises on the near horizon.
Are these four wars the last? I certainly hope so. But right now, I see the real possibility of several more:Possible War #5 Iran vs. the U.S. or IsraelIsrael is already at war with Irans protégées the Hezbollah of Lebanon, the group Ive been warning you about for many months.
Indeed, last year, I told you about the direct link between Hezbollah and Irans special al Quds Force, which, in turn, is under the direct auspices of Irans Revolutionary Guard.
I explained why these forces are far greater threats to the West than al Qaeda. And I told you it was only a matter of time before they attacked.
Thats whats just happened in Lebanon. And now, you dont needme to connect the dots for you. You can do it yourself:· The U.S.is the chief arms supplier and financial backer of Israel.· Israel is at war with Hezbollah.· Hezbollah gets its weapons and financing mostly from Iran.· Ergo, indirectly, the U.S. is already at war with Iran.
If there were no other source of conflict between the U.S. and Iran, it could be more easily. But never forget:
- Iran and the U.S. have had no diplomatic relations since Iranian students stormed the U.S. embassy in Tehran a quarter-century ago.
- Irans agents have been pouring into Iraq, training and arming Shiite militias, establishing alliances both inside and outside the government.
- Iran has just thumbed its nose at the U.S. and Europe, refusing to budge in its drive to become a nuclear power.
- Iran is poised to resupply Hezbollah and quickly replenish its missiles destroyed in recent days.
Now, with all these conflicts converging in one time and place, Larrys forecast of a war with Iran, the first I heard from any analyst anywhere, seems closer than ever to reality.Possible War #6 Syria vs. the U.S. or IsraelThe U.S. has had Syria on its radar screen since the beginning of the Iraqwar, accusing its leaders of complicity in the Iraqi insurgency.
The U.S. and the West have accused Syrias top leaders of assassinating Lebanons former prime minister Rafiq Hariri, with a U.N. investigation into the murder still ongoing.
The U.S. has charged that Syria is also a major backer of the terrorist Hezbollah.
The U.S. is further angered by Syrias emerging alliance with Iran. And just yesterday, Bush administration officials said they are seeking ways to separate the two countries. If they cant, the implication is that Syria could also be a target.
Most ominous of all, Syrias information minister has just declared that if Israeli ground troops approach its border, it will enter the conflict, a serious widening of the war with untold consequences for both sides.Possible War #7 Turkey vs. KurdistanIn my last report, I explained the immediate consequence of a civil war in Iraq: The emergence of a new independent Kurdish nation in the northwest Iraqi Kurdistan.
The big problem: In that scenario, Turkey has vowed to invade Iraq with its own ground troops.
Reason: About half of all Kurds live in Turkey, numbering some 15 million. And for over 85 years, they have rebelled unsuccessfully to create their own nation.
The Turkish government will do virtually anything suppress any further rebellions. And the formation of an independent Kurdistanon their Eastern border is their most feared threat. They will not let it happen.
To most Americans, all this may seem irrelevant. But nothing could be further from the facts. Turkeyis a member of NATO. And for the first time, two NATO nations the U.S. and Turkey would be on opposite sides.Possible War #8 India vs. PakistanSince their independence from Brittan after World War II, India and Pakistan have gone to war four times: in 1947, 1965, 1971 and as recently as 1999.
Until recently, these two South Asian nuclear powers were engaged in a peace process which seemed to be moving forward.
But the terrorist blasts in Mumbai this month have dealt a severe blow to peace. India obliquely blames Pakistan for the attacks. Pakistan blames domestic Indian terrorists.
The governments on both sides want the peace process to continue. But the extremists on both sides want to derail the process, cause chaos and precipitate another war. And, unfortunately, if the pattern in Iraq and Lebanon is any indication, the extremists have a reasonable chance of succeeding.
Most of Middle East, Persian Gulf and South Asia
Peering further into the future, if these wars cannot be prevented, the conflict is likely to spread to other neighboring Muslim nations, also rich in oil and natural resources.
That includes Turkmenistan, Uzbekistan and Kazakhstan to the North ... Saudi Arabia and Yemen to the south ... plus Jordan, sandwiched in between Iraq and Israel.
All told, the conflicts could cover an area twice the size of Europe, with triple the population.
This is very serious. And the inevitable financial consequences can be best summarized in one single word inflation.
These wars can only bring more debts, more deficit spending and more money-pumping by central banks around the world to help finance their armies.
And it means far broader threats to the supply of commodities than heretofore debated or imagined.
Look. These war-prone regions represent the overwhelming bulk of the worlds oil reserves.
Just in the Middle East alone, their oil reserves are over seven times greater than those of the next largest sources.
Plus the region has some of the largest deposits of natural gas, magnesium, tin, uranium, coal, iron, copper, zinc and gold.
Never before has there been a greater reliance by the worlds fastest growing economies on these resources! And never before have I seen a greater threat to these supplies. That explosive combination is a classic precursor to raging inflation.
I pray Lebanon and Israel will not wage an all-out war. I pray the raging civil war in Iraq will not split the country into three. I hope Iran, Syria, Turkey and Saudi Arabiawill not be dragged further into the conflicts.
But even in the best-case scenario, the commodity price surge weve seen so far is already enough to spur much more inflation.
That means more interest-rate hikes, despite anything Ben Bernanke may say.
It means more plunges in interest-sensitive stocks, despite any near-term rallies.
And it means you need to take firm action to protect yourself against the fall-out. My recommendations ...
First, Keep a Big Portion of Your Money Safe, in U.S. Treasury Bills
Treasury bills offer four major advantages:Advantage #1. No principal risk. As long as you can wait the three months until maturity, youre guaranteed a 100% return of your principal plus interest. Moreover, this guarantee is based on a direct guarantee by the U.S. Treasury Department, still the highest rated institution in the world today.Advantage #2. Exempt from local and state income taxes. This is a significant but little known advantage that Treasury bills offer, which CDs and other bank accounts do not offer.Advantage #3. Extremely liquid.If you want to sell your Treasury bills before maturity, you can do so in a very active, highly liquid secondary market. And with a Treasury-only money fund, you can move even more swiftly.Advantage #4. Rising yields. Each time the Fed raises its rates, your yield goes up promptly. Youre never locked in to old, lower rates. And right now, the T-bill rate has risen to the point where it covers the loss in purchasing power that you suffer with consumer price inflation.
The most efficient way to buy Treasury bills is through a Treasury-only money market fund.
You can withdraw your money at any time via wire transfer. You can write checks against your money fund shares and continue earning interest until the checks clear. Plus, in comparison to banking fees, the fees charged by most money funds are far lower.
Our favorite Treasury-only money funds, in alphabetical order, are:American Century Capital Preservation Fund (CPFXX; 800-345-2021)Dreyfus 100% U.S. Treasury Fund (DUSXX; 800-645-6561)Fidelity Spartan U.S. Treasury Fund (FDLXX; 800-544-8888)USGI U.S. Treasury Securities Cash Fund (USTXX; 800-873-8637)Vanguard Treasury MMF (VMPXX; 800-662-7447)Weiss Treasury Only Money Fund (WEOXX; 800-430-9617)
Second, Put Some of Your Money in Gold
If youve been following our gold and gold stock recommendations, your profits should already be impressive. And you have the potential to repeat the performance or better even if you start right now.
Consider streetTRACKS Gold Trust (GLD). This is the large, widely-traded exchange-traded fund (ETF) that tracks the price of gold bullion.
Until this ETF was available for purchase in U.S.markets, the only way you could directly invest in the yellow metalwas by buying gold bars or gold coins, incurring annoying storage and insurance costs. Now, however, you can effectively buy or sell gold just like you buy or sell any major stock. The price of GLD is set to one tenth of the price of an ounce of gold bullion.
Third, Maintain a Stake In Energy Investments
There are also quite a few exchange-traded funds that are dedicated to the energy sector:
Oil Service HOLDRs (OIH) focuses on companies that provide drilling, well site management and related products or services for the industry. Its the second-largest among the six energy ETFs, with a total market capitalization of over $1.74 billion.
SPDR Energy (XLE) invests primarily in energy companies that develop or produce crude oil and natural gas. With a market capitalization of over $2.6 billion, its the largest and most liquid of the energy ETFs.
PowerShares Wilder Clean Energy (PBW) is quite different from the other two, focusing on alternative energy. Its based on the WilderHill Clean Energy Index typically renewable sources of energy and technologies. The fund is still small but growing nicely.
This gives you several alternatives. Plus, it should give you a good balance between safety and inflation protection.
Good luck and God bless!
Martin [D. Weiss]This investment news is brought to you by Money and Markets. Money and Markets is a free daily investment newsletter from Martin D. Weiss and Weiss Research analysts offering the latest investing news and financial insights for the stock market, including tips and advice on investing in gold, energy and oil. Dr. Weiss is a leader in the fields of investing, interest rates, financial safety and economic forecasting. To view archives or subscribe, visit http://www.MoneyandMarkets.com
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Sunday, July 23, 2006
Computer Home Business System
Are you good with computers and considering a home business where you can utilize your computer knowledge? You may be interested in starting a computer tech business from home offering support to the millions of Americans who own computers but often times become very frustrated with them. If you are planning this type of business with your spouse and have children, carefully consider this venture before stepping into it. You will need to be able to manage your time and have an excellent ability to communicate with each other. You do not want your partnership to turn into a power struggle or both your marriage and business can become at risk. Starting a home business requires both a financial and an emotional investment, so weigh your options carefully before jumping into the arena of home-based businesses. It will be important to divide the responsibilities within the business. Look at the strengths that both of you have and divide them up that way. If both you and your spouse have great skills when it comes to working with clients, one of you may prefer to do a different part of the business. Your business will succeed when you work together utilizing each other’s strengths as opposed to getting into a power struggle over who should work in which area of the business. Just as in a corporate environment, you have those who work in the forefront working with the customers and managing the day-to-day operations and others who work behind the scene generating the paperwork, payroll, and other office duties. Any large financial decisions should always be made together. Plan as to how you are going to handle disputes that arise, because they do arise in all businesses. Again look at how businesses are run--have weekly meetings or even morning daily meetings to look at what you are going to accomplish that day. If you never take time to communicate with each other as to what is happening, your business will fail. Having weekly or daily meetings will lessen the chance of something happening that is unexpected and you will be more able to handle the little things that crop up. If you have children in the home consider hiring someone to come in and take care of the kids while you are working. It does not have to be all day but maybe for a few select hours when you know that you and your spouse need to concentrate without interruptions. Although one of the reasons you probably wanted to start a home business is so that you can be home with your children, you will not be very effective if they are demanding your attention at each moment all day long. Your children will have to adjust to the business being in your home the same way you and your spouse are adjusting. Children, however, still like it when their parents are around, and parents can monitor them much more easily if they are only a room away. © 2006 HomeNetMonies.com
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Thursday, July 13, 2006
Work at Home, Work From Home - It's Still Work, Even at Home
It seems that many people dream about working from home and being their own boss these days. Just roll out of bed and drink fresh coffee while leisurely pondering through e-mails. There would be no commute, no one to distract you, and your focus will be impeccable. In reality it's not quite as easy as one might dream about. Being solely in charge of yourself and your time is not as easy as you might think. The overconfidence and then surprise of unexpected issues can cause great stress and confusion. There is also the problem of being able to self-motivate without the pressure of a boss on your back. Many people find themselves more distracted and less productive when left to their own demise. When you work from home you are responsible for managing your own time. To organize yourself better and get more done, try the following tips for successful time management as your own boss. 1. Make sure you have a separate work area in your home. This does not mean that you have to have a complete office in a private room. Just make sure you have a desk and all your accessories in a corner of one room. This will be your defined work area and everything you need should be in reach. 2. Learn how you work best. You really need to find the best place in your home that will make you the most productive. Make sure you are comfortable but not distracted by outside influences. 3. Be mentally ready to take on specific tasks. Make sure to plan your workday to fit your energy level. Be realistic on what you can accomplish. If you are a morning person then do the hardest things in the morning hours. Make sure to value your personal commitments--these will give the breaks you will need to clear your head and get energized. 4. Make sure you have the time to accomplish tasks by setting specific business time hours. Most people just figure that because you are at home you are available. This is not true. Interruptions are the biggest problems with the self-employed. Make sure the people know when you are to be working and not to call, IM, or e-mail you. Put the hours you are available on your web site to allow customers to know when you will be there physically. Also let friends and anyone not business-related know that during this time frame you will not be available for social calls. Realize that this way of working takes a lot of negotiating, planning, and prioritizing. No matter what you do, you will get that personal call or drop-in while you are trying to work. You will also get that business call or e-mail after your specified hours. It happens to everyone. Don’t stress out. Take the emergency approach. If this is a personal or business emergency deal with it immediately. If it is something that can wait till an appropriate time then let the person know.
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