Stock Market News & Stocks to Watch from StraightStocks » Emerging Markets

On the Ground in Brazil

Frank Holmes — Mon, 23 Nov 2009 06:00:00 +0000

If seeing is believing, natural resources and infrastructure opportunities abound in Brazil. The above photo was snapped by our global strategist Jack Dzierwa at Satilde;o Paulorsquo;s Guarulhos International Airport as he spent hours trying to board a domestic flight to Rio de Janeiro. Not surprisingly, he didnrsquo;t make the flight. Jack has traveled extensively around the world, and he says hersquo;s never seen anything like the hectic scene at Guarulhos, which just canrsquo;t service the rapidly growing number of Brazilians who can now afford to travel by air. Scenes like this are important for investment managers to experience in order to grasp the significance of whatrsquo;s taking place in emerging countries like Brazil. You just canrsquo;t get the full flavor of the chaos at Guarulhos from an economic data spreadsheet or a research report. Jack traveled to Brazil to collect some insight on the countryrsquo;s infrastructure development and the best prospects for investment. His experience at the airport gives him tacit knowledge and a clear understanding that Brazil will have to expand on its domestic infrastructure. Brian Hicks, who co-manages our Global Resources Fund (PSPFX), has also spent the week in Brazil ndash; he has been doing research and meeting with natural resources companies. Brazil is a key driver for natural resources and infrastructure markets. It is home to 190 million people, many of them moving into the middle class, and itrsquo;s also one of the worldrsquo;s fastest-growing economies. Similar to China, this rise of the middle class will increase demand for oil and other commodities, and its expansion will put growing pressure on the countryrsquo;s inadequate infrastructure. Just a couple of weeks ago, a blackout left nearly 60 million people without electricity and another 7 million without water. Traffic in downtown Satilde;o Paulo is so bad that many businessmen use helicopters as taxis to get around the city. Brazil only has three main international airports, despite that it has 14 cities with at least 1 million residents. The U.S. Energy Information Administration estimates that Brazil has more than 12 billion barrels of proven oil reserves. That number is certain to grow as we learn more about the large discoveries recently made off its southeastern coast. In addition to vast reserves of oil, it is also a leading producer of iron ore, aluminum, platinum and other industrial metals. This natural wealth puts Brazil in an enviable position compared to some other large emerging economies. As the domestic demand for resources increases with infrastructure expansion, much of that demand can be met from internal sources. This benefits the economy on both ends and sets the stage for further economic growth. Please consider carefully a fundrsquo;s investment objectives, risks, charges and expenses. For this and other important information, obtain a fund prospectus by visiting www.usfunds.com or by calling 1-800-US-FUNDS (1-800-873-8637). Read it carefully before investing. Distributed by U.S. Global Brokerage, Inc. All opinions expressed and data provided are subject to change without notice. Some of these opinions may not be appropriate to every investor. Foreign and emerging market investing involves special risks such as currency fluctuation and less public disclosure, as well as economic and political risk. Because the Global Resources Fund concentrates its investments in a specific industry, the fund may be subject to greater risks and fluctuations than a portfolio representing a broader range of industries. #09-818

A Warning Shot for Washington

Frank Holmes — Thu, 12 Nov 2009 06:00:00 +0000

I often say that money goes to where itrsquo;s treated best, and a Bloomberg News story this week shows that Irsquo;m not the only one who believes that. The CEO of Emerson Electric, which makes a wide range of industrial and technology products, says the U.S. governmentrsquo;s plans for greater regulation and higher taxation are pushing his company to move more of its business operations overseas. David Farr, who heads the $21 billion company, didnrsquo;t pull any punches: ldquo;Washington is doing everything in their manpower, capability, to destroy U.S. manufacturing.rdquo; And Farr predicts he will have plenty of company in the exodus to China, India and other places ldquo;where people want the products and where the governments welcome you to actually do somethinghellip; Im not going to hire anybody in the United States. Im moving.rdquo; Government policies for peace and prosperity are a key component in determining a countryrsquo;s growth prospects and attractiveness for investors. Worries about the unintended consequences of Washingtonrsquo;s policies have been growing ndash; David Farrrsquo;s blunt assessment speaks for those concerned about the risks of governmental overreaching. Read the Bloomberg Story Here By clicking the link, you will be directed to Bloomberg.com. U.S. Global Investors does not endorse all information supplied by this website and is not responsible for its content. All opinions expressed and data provided are subject to change without notice. Some of these opinions may not be appropriate to every investor. None of U.S. Global Investors family of funds held any of the securities mentioned in this article as of 9-30-09. #09-798

Nigel Rendell: Buy Brazil, sell eastern Europe

Prieur du Plessis — Tue, 10 Nov 2009 07:33:46 +0000

This post features an interview with Nigel Rendell, emerging market strategist of RBC Capital Markets about a broad spectrum of emerging-market related issues.

Fuel Your Portfolio With BHP Billiton (NYSE: BHP): The Best-Run Commodities Company In The World

Investment U — Thu, 05 Nov 2009 14:37:22 +0000

Fuel Your Portfolio With BHP Billiton (NYSE: BHP): The Best-Run Commodities Company In The World by Tony Daltorio, Investment U Research Some companies just stand out – both in their own sectors and in the larger market. Australian firm BHP Billiton (NYSE: BHP) is one of them. As the largest and most diversified commodities producer in [...]

Bank On HSBC Holdings (NYSE: HBC) and the Asian Equation

Investment U — Wed, 04 Nov 2009 17:40:44 +0000

Bank On HSBC Holdings (NYSE: HBC) and the Asian Equation Tony Daltorio, Investment U Research “Go west, young man, go west!” Written by Indiana journalist John Soule in 1851 and popularized by New York Tribune founder Horace Greeley the same year, that now-famous saying advised people to take advantage of the rapid growth in the [...]

Prieur’s readings (November 4, 2009)

Prieur du Plessis — Wed, 04 Nov 2009 09:32:08 +0000

This post provides links to a number of interesting articles I have read over the past few days that you may also enjoy. Please also add the links to any other worthwhile articles you would like to share to the comments section.

Marc Faber: Buy emerging market stocks

Prieur du Plessis — Wed, 04 Nov 2009 09:30:03 +0000

Marc Faber, author of the Gloom Boom & Doom Report, said that the dollar should have "some kind of a rebound", but longer term is in a "structural bear market". He advises investors to increase holdings in emerging markets and says cash is less attractive than stocks.

The Rise of the Rest

Trading School — Thu, 29 Oct 2009 10:46:12 +0000

One great thing about my position here as Director of Marketing is my extensive contact list. I say that because I have access to thousands of excellent traders, investors, and economists at my finger tips! So when things around the world catch my attention, I can quickly find someone who can give me the skinny [...]

Emerging Market ETFs… Five Ways to Play

Investment U — Wed, 21 Oct 2009 18:38:54 +0000

Emerging Market ETFs: Five Ways to Play Tony Daltorio, Investment U Research Crises have a way of overturning the established order. And as the recent G20 meeting in my native Pittsburgh reminded me, the continuing financial and economic crisis is no exception. The very fact that the group has expanded from the original [...]

Copenhagen 2009 and Equity Markets

Richard Shaw — Tue, 20 Oct 2009 21:06:11 +0000

We don’t know if the furor over climate, economic and sovereignty issues coming to a head over the impending December Copenhagen climate treaty is correct, incorrect, exaggerated or spot-on. Obama on Cost Impact of Climate Policies (March 18, 2009): Warren Buffett on Cost Impact of Climate Policies (March 9, 2009): There is now concern that Obama will sign [...]

As if China’s Offering Weren’t Enough, Russia Also Plans International Bonds

The Daily Reckoning — Mon, 19 Oct 2009 20:00:23 +0000

Not to be outdone by China’s recent bond offering, Russia is now planning to raise $18 billion in its first international bond sale in about ten years. The securities will be dollar-denominated and offered toward the beginning of 2010. Russia is planning to take advantage of its position as an emerging market, with yield spreads that [...]

As if China’s Offering Weren’t Enough, Russia Also Plans International Bonds originally appeared in the Daily Reckoning. The Daily Reckoning, a FREE daily e-letter, offers a "uniquely refreshing" perspective on the global economy, investing, and today's markets.

Looking for Potential Sinkers in the SP 1500

Richard Shaw — Fri, 16 Oct 2009 20:12:39 +0000

This is a practical follow-up to our recent article on volume as an indicator, and on divergence between volume and price action in particular. We screened the S&P 1500 for stocks with rising prices and falling volumes. More specifically, we looked for stocks with “sinker” attributes: last closing price > 21-day simple moving average price positive 21-day price [...]

Volume Perspective on U.S. and China ETFs

Richard Shaw — Fri, 16 Oct 2009 09:41:18 +0000

In our last article, we estimated the probable price range of the S&P 500 based on historical and implied volatility, and suggested that the positive area of the range was more likely than the negative area for the next few weeks, because of the moving average trend indicators and the declining volatility of the 1-month [...]

Energy, Brazil, Gold: What More Could You Want?

Byron King — Fri, 09 Oct 2009 19:33:21 +0000

pLet’s take a quick look at what’s happening in Brazil, over and above the 2016 Olympics being awarded to Rio de Janeiro./p p“I don’t know if I will live to see it,” said Brazil’s president Luiz (Lula) da Silva a couple weeks ago. “But Brazil has to transform itself into a big power in the 21st century. We have everything to make it happen. We are not talking about a little country here.”/p pNo, indeed. Brazil is not “a little country” anymore. Any prudent investor has to consider how to hitch a ride on the Brazil growth story. Brazil is transforming into one of the world’s great powers in this century. It’s important to follow the news from Brazil. At the same#8230;/p

In praise of emerging markets

Prieur du Plessis — Mon, 05 Oct 2009 05:30:06 +0000

"We are currently in the midst of a synchronized global recovery, and with aggressive government stimulus, strong balance sheets and an ever-growing share of global GDP, emerging markets are likely to outperform the developed markets due to strong domestic consumption and forward-looking infrastructure investments," said John Derrick in this guest post. A few interesting charts are included.

In Praise of Emerging Markets

Frank Holmes — Mon, 05 Oct 2009 05:00:00 +0000

This commentary is from John Derrick, U.S. Global Investorsrsquo; director of research. If you believe now is a good time to invest in U.S. stocks, emerging markets may offer even more opportunity. We believe global growth is the most powerful investment theme now and for the foreseeable future. You can see this playing out as countries like China, India and Brazil grow in economic stature. As we saw in Pittsburgh last week, the G-7 is being supplanted by the more inclusive G-20 when it comes to global economic decision-making. Emerging market stocks were hit especially hard during the financial crisis but have been among the best performers during the rebound. We are currently in the midst of a synchronized global recovery, and with aggressive government stimulus, strong balance sheets and an ever-growing share of global GDP, emerging markets are likely to outperform the developed markets due to strong domestic consumption and forward-looking infrastructure investments. The chart below from Goldman Sachs on consumer spending illustrates that point. Goldman estimates that consumer spending in China will increase by about 10 percent in 2010, while India and Brazil will be in the 4 percent to 6 percent range. At the same time, negative growth is expected in Spain, Britain and Italy, and the forecast for the United States is flat. Industrial production in emerging markets has recovered to roughly where it was when the recession began; in developed markets, IP is still down nearly 20 percent. This second chart, also from Goldman Sachs, compares the operating margins in developed and emerging markets for the companies in Europersquo;s Dow Jones Stoxx 600 Index. The analysis going back to the early 1990s found that the emerging-market operations of these companies have consistently yielded higher margins, and oftentimes the spreads have been significant. U.S. Global Investors recently hosted a global outlook webcast that featured Dr. Marc Faber, the well-known investor based in Hong Kong. In the course of that webcast, Dr. Faber addressed the developed-versus-emerging issue: If you look at the next 10 to 20 years in the West, I donrsquo;t see how the lifestyle of the average person will improve meaningfully. On the other hand, if you look at a country like Vietnam, they have a GDP per capita annually of $800 which may go to $3,000 over the next 15-20 years. The same is true for China and India. You suddenly have a middle class of 230 million people in India who will be buying cars like the $2,500 Nano and other goods. Once a family moves from the bicycle to the motorcycle, itrsquo;s an improvement in their standard of living. But when you move to the car and drive your children to school in your car, itrsquo;s a huge increase in your standard of living and your social class. Global growth has been a tremendous benefit for commodities, with the key driver being strong demand from China. And as we pointed out in a recent webcast focused on China, that use of commodities is less to fuel export growth and more to satisfy domestic demand as income levels rise. Increasing demand for commodities and the corresponding rise in prices has positive knock-on effects for much of the developing world. The increasing importance of emerging countries in the world order also argues for their currencies to strengthen relative to the dollar. International stock markets outperformed the U.S. market during the 1970s and much of the 1980s, with much of that outperformance relating to relative currency strength. A continuation of the dollarrsquo;s decline in the face of slow growth and yawning budget deficits ndash; nearly $11 trillion between 2009 and 2019, according to White House estimates ndash; would provide a significant tailwind for globally-minded investors. All opinions expressed and data provided are subject to change without notice. Some of these opinions may not be appropriate to every investor. Foreign and emerging market investing involves special risks such as currency fluctuation and less public disclosure, as well as economic and political risk. The Dow Jones STOXX 600 Index is an index of 600 stocks representing large-, mid- and small-capitalization companies in the developed countries of Europe.

Investing in Emerging Markets: Three Reasons Why You Should Buy India, Not China

Investment U — Fri, 02 Oct 2009 13:52:37 +0000

Investing in Emerging Markets: Three Reasons Why You Should Buy India, Not China by Karim Rahemtulla, Advisory Panelist India has come a long way since 1997. The year marked my first trip to the country – and I remember it well, as I headed back to America with a resounding “sell” ringing in my ears with [...]

Think China vs. India

Contrarian Profits — Wed, 30 Sep 2009 18:02:46 +0000

pThe U.S.’ potential conflict with Iran might pale in comparison to a fight brewing between China and India, says a href="http://www.contrarianprofits.com/articles/author/chris-mayer/" class="alinks_links"Chris Mayer/a. “This one doesn’t seem to get much attention in the Western media, but I’ve read some dire stuff from the Eastern media. By their lights, the Sino-Indian border hasn’t been this tense since 1986-87, when the skirmishes broke out between Indian and Chinese troops./p p“The issue is a disputed border between the two. They fought a 32-day war over it in 1962. China emerged victorious, but the whole thing settled nothing. The border between the two remains hotly contested. It is nearly 2,500 miles long and winds its way across difficult mountainous terrain. There is a northeastern state in India#8230;/p

Financial Crisis Gives Chinese Car Companies a Chance to Get Up to Speed

Contrarian Profits — Thu, 24 Sep 2009 20:04:01 +0000

pThere’s no question that the big “winner” in the global financial crisis has been China. While for the past two years developed economies have been scrambling to keep afloat China has taken a nuanced approach to achieving its economic and political goals./p pChina has used depressed commodities prices a href="http://www.moneymorning.com/2009/02/16/invest-in-china-companies/"to stock up on long-term supplies of raw materials such as oil, copper, and iron/a. And it’s used structural weakness in the U.S. financial system as a href="http://www.moneymorning.com/2009/03/23/emerging-markets-dollar/"justification for replacing the dollar as the world’s main reserve currency/a./p pNow, the Red Dragon is looking to make headway on the highway by winning global market share in the automotive market while U.S. heavyweights spin out./p p“a href="http://www.bloomberg.com/apps/news?pid=20601080#38;sid=aLM9hILW4GLU"We aren’t afraid of the financial crisis/a,” Zhou Fuquan, vice president of#8230;/p

The Next Great Oil Frontier

Byron King — Thu, 24 Sep 2009 18:32:01 +0000

pOffshore Nambia is quickly becoming one of the world’s greatest frontier oil provinces./p pBack in the 1960s and 1970s, a few major companies took out oil exploration concessions there from the government of South Africa. In 1974, Shell (NYSE: a href="http://www.google.com/finance?q=NYSE%3ARDS.A"RDS.A/a / a href="http://www.google.com/finance?q=NYSE%3ARDS.B"RDS.B/a) discovered a gas field off the southwest coast with the Kudu project. Early estimates were 1 trillion cubic feet of reserves, but current estimates range up to 10 trillion. Kudu was big, but nobody much cared about natural gas back then. Gas was too cheap, and southern Africa was too far away./p pThere was hardly any development around Kudu for the next 20 years. South Africa was under international sanctions due to its apartheid regime, so oil companies and other outside#8230;/p

How China became the ‘800-Pound’ Gorilla in the Gold Market

Don Miller — Wed, 23 Sep 2009 14:24:46 +0000

pWith prices testing their record high of $1,033 an ounce set last year gold has again become the hot topic of conversation./p pBut while many analysts are focusing on threat of inflation – which could be a byproduct of the U.S. Federal Reserve’s reluctance to withdraw monetary stimulus – investors should really be watching China./p p“In the post-financial crisis global economy, China is quickly becoming the proverbial ‘800-pound gorilla’ – the player that has to be courted, but that can’t be tamed,” said strongema href="http://www.moneymorning.com" class="alinks_links"Money Morning/a/em/strong Contributing Editor Peter Krauth./p pIn a recent article for strongemMoney Morning/em/strongem, /emKrauth said that he believes the stage has been set for gold to make a lasting run above $1,000 an ounce, in no small part because of China./p pFor#8230;/p

Asian Economies to ‘Lead the Recovery,’ Says ADB

Contrarian Profits — Wed, 23 Sep 2009 13:23:38 +0000

pAsian economies are recovering faster than previously thought and will lead the charge out of the worst global downturn since the 1930s, according to new forecasts by the Asian Development Bank (ADB) – a Manila-based institution that promotes economic and social progress in the Asia-Pacific region./p pAfter slashing its forecast for the region in March, the ADB reversed course in its updated ema href="http://www.adb.org/Documents/Books/ADO/2009/Update/" target="_blank"Asian Development Outlook (ADO) 2009/a/emem. The bank said developing economies in Asia would grow by 3.9% this year, up from its previous forecast of 3.4%./em/p p“Despite worsening conditions in the global economic environment, developing Asia is poised to lead the recovery from the worldwide slowdown,” said ADB Chief Economist Jong-Wha Lee./p pHowever, the growth will not be evenly distributed. Economic growth#8230;/p

Kimberly Clark Corp. Offers a Strong Defensive Position and a Generous Dividend Yield

Contrarian Profits — Mon, 21 Sep 2009 19:06:30 +0000

pIn the last few months we have seen a very strong stock market rally. The market has recovered from highly distressed levels and posted exorbitant gains. In addition the “wall of money” from the U.S. Federal Reserve has pushed risk-prone investors back into the market, pushing its general level up. /p pYou see, the massive fiscal stimuli and ultra-easy money from the Fed does indeed have real effects on the economy. Whether you want to call them artificial or real, the stimuli have moved and will continue to move profits, until it is withdrawn. And the timing of the deployment of the fiscal and monetary stimuli, the timing of its positive effects and the timing of its eventual removal are uncertain./p pIn#8230;/p

China Gets in on the Trade of the Decade

Contrarian Profits — Mon, 21 Sep 2009 18:03:13 +0000

pThis week, the big story was once again coming from the gold market. Mid-week, the yellow metal hit $1020 – but the rally was not of the usual variety. Generally, investors flock to gold when the dollar is weak and inflationary fears run high. But as we all know, inflation is not a problem right now – despite the Fed’s best efforts./p pNo, this rally had another factor pushing it: our friends in the Far East. The Chinese have been quite vocal with their concern over the US dollar and have increased their official gold reserve holdings by 75% in the spring. Smart move./p pIn the Weekend Edition’s Highlight of the Week, a href="http://www.contrarianprofits.com/articles/author/bill-bonner/" class="alinks_links"Bill Bonner/a looks closely at where the recent rise in gold#8230;/p

Investing in ADRs: The Most Powerful Way to Reduce Market Risk

Contrarian Profits — Mon, 14 Sep 2009 20:39:44 +0000

pIt’s official: You can reduce your investment risk simply by chucking darts at a list of stocks, then buying them./p pThat’s if you believe a Nobel economist, of course. His crude “experiment” was the start of em“/ememmodern portfolio theory”/em decades ago. The downside, however, was that with a reduction of risk came a dampening of profits. So scratch that idea./p pHow about this? A startling study in the late 1970s showed that owning a portfolio of large U.S. companies with international divisions drops your risk 10% below a domestic stock portfolio. Much better. But that wasn’t the eye-popper…/p pThe study also found that owning stocks in international companies cuts your risk in half…/p pTake that, “efficiency” theorists! Yet the stuffy professors still tried to refute#8230;/p

Kraft’s Bid for Cadbury Not Sweet Enough

Contrarian Profits — Thu, 10 Sep 2009 17:31:19 +0000

pKraft Foods Inc.’s (NYSE: a href="http://www.google.com/finance?q=NYSE:KFT"KFT/a) $16.7 billion unsolicited takeover attempt of Cadbury PLC (NYSE ADR: a href="http://www.google.com/finance?q=NYSE:CBY"CBY/a) is the latest sign of consolidation in the highly competitive food industry, and will likely lead to two things: A bidding war for Cadbury and further consolidation in the sector./p pThe world’s second-largest foodmaker went public with its bid for Cadbury earlier this week after being snubbed privately. Kraft’s offer – a 31% premium to the chocolate maker’s Friday closing price of $37.46 a share, but less than – “fundamentally undervalues” Cadbury, it said. The offer is less than 15 times Cadbury’s 2008 earnings before interest, tax, depreciation and amortization (EBITDA)./p p“Any follow-up offer by Kraft would likely involve a higher price,” Moody’s Investor Service senior#8230;/p

China’s Energy Acquisition: Three Ways to Invest in China

Contrarian Profits — Fri, 04 Sep 2009 18:30:12 +0000

pEvery country needs a few basic ingredients in order to achieve healthy, sustained economic growth./p ul type="disc" liReliable sources of energy./li liA modern, efficient infrastructure, consisting of a good road and rail system, reliable power grids and high-speed digital communications networks./li /ul pAnd if a country wants to be considered a “global economic powerhouse,” it’s nearly impossible for it to do so without these critical building blocks./p pSo it’s not too surprising that China is spending unprecedented amounts of money to beef up its infrastructure./p pIt’s also spending huge amounts of money on long-term oil and gas contracts. And with nearly $2 trillion on hand, it’s the perfect time for China to go on an energy acquisition spree./p pRight now, it’s spending like a thirsty sailor on shore leave…/p pYou#8230;/p

What Chinese Money Buys: Gold Goes Green

Chris Mayer — Thu, 03 Sep 2009 12:00:09 +0000

pU.S. banks are going bad as quickly as a bunch of over-ripe peaches in the summer heat. On the heels of the Colonial Bank failure comes another sizable bank failure./p pGuaranty Bank in Texas became the 81st U.S. bank to fail this year. It was the 11th largest bank failure in U.S. history. This kind of thing is becoming so regular it is hardly news when it happens./p pBut what’s interesting to point out about this one is that the FDIC sold Guaranty to Banco Bilbao Vizcaya Argentaria of Spain. This is the first time regulators have sold a failed bank to a foreign lender. Such a turn of events would have been unthinkable only a decade ago./p pSo the world turns. When#8230;/p

China and India: Canaries in the Coal Mine?

Richard Shaw — Wed, 02 Sep 2009 21:24:43 +0000

Here are two bits of business news that investors should factor into economic recovery projections. Hindustan Times (September 2, 200) Exports dip again, down 28.4% in July India’s exports contracted for the 10th successive month, plunging by 28.4 per cent in July as order books continued to dry out from two of the biggest growth regions—the US and [...]

Don’t Count Out Emerging Markets

Terence Chan — Fri, 28 Aug 2009 14:48:00 +0000

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Forget BRIC… These Emerging Economies Hold the New Keys to Growth

Chris Mayer — Wed, 26 Aug 2009 20:32:43 +0000

pIt’s become widely accepted when talking about emerging economies to focus on the so-called BRIC countries - Brazil, Russia, India and China. But there is a very important region that gets lost in that discussion./p pAnd it’s a region that holds the key to growth opportunities that could eclipse the growth in the BRIC countries./p pIn fact, this region collectively has a bigger economy than Brazil, Russia or India already. And in terms of growth, it is growing faster than any of these countries. In terms of population, it’s bigger than the U.S. and nearly as populous the EU. It holds 60% of the world’s proven oil reserves and nearly half of its natural gas./p pThat last clue probably gives it away. I’m#8230;/p

How Mexico’s Second Manifesto Could Pay You a Fortune

Contrarian Profits — Mon, 24 Aug 2009 22:39:51 +0000

pFrancisco Madero was a revolutionary Mexican leader in the fight for property rights in the early part of the 20th century. Madero, a longtime politician, upset the very powerful seven-time Mexican President Porfirio Diaz by running against him in the 1910 election./p pDiaz was willing to give up his presidency, but apparently not to Madero. Diaz imprisoned Madero on election day. Madero broke out and escaped to Texas, where he published his “Letter From Jail” — a manifesto for suffrage and term limits./p pIn this letter, the hint of agrarian reform and socioeconomic changes was enough to start the Mexican Revolution and seat him as the new president in 1911. While his presidency was a failure, his principles lived on./p pAfter a bloody#8230;/p

I’m Still Bullish on Frontier Markets

Michael E. Brisky — Mon, 24 Aug 2009 13:30:00 +0000

I want to preface this by saying I'm not as bullish on "frontier markets" as I am on "emerging markets". (I define frontier markets as Africa, the Middle East, Eastern Europe; I define emerging markets as the BRIC countries, and a few others). But while the frontier markets were marked down especially hard in 2008, I'm still bullish on their outlook. Many are resource rich, and with political stability, their economies will grow. Keep in mind also that I have a very long time horizon until retirement, and can afford to be patient with investments like these. I do own T Rowe Price's African and Middle East Fund (a href="http://finance.yahoo.com/q?s=tramx"TRAMX/a). A recent development for them (within the past year) is that they were allowed to buy shares in Saudi Arabia, which is one of the most attractive countries to invest in in that region. Although for the time being these countries mostly follow oil prices and the subsequent boom of the economy in areas like Dubai, I feel over time we'll continue to see more diversification, which will attract more investors.br /br /I saw this note out from Goldman Sachs regarding UAE banks today (a href="http://www.bloomberg.com/apps/news?pid=20601087amp;sid=az46SDUmvS5A"via Bloomberg/a):br /br /blockquotepUnited Arab Emirates’ banks may rise an average of 30 percent in a year as earnings “remain attractive” and valuations catch up with the emerging markets average, a href="http://www.bloomberg.com/apps/quote?ticker=GS%3AUS" t_above="true" t_static="true" t_fontcolor="#000000" t_fontface="Verdana,sans-serif" t_bgcolor="#ddedd9" t_width="110" t_delay="50"Goldman Sachs Group Inc./a said.br /br /Valuations of six out of the top seven U.A.E. banks that Goldman Sachs covers are likely to improve to 1.2 times their estimated 2010 book value from about 1 as they catch up with the peer average in Turkey, Russia and South Africa, Goldman Sachs’ analysts led by a href="http://search.bloomberg.com/search?q=William+A.+Mejiaamp;site=wnewsamp;client=wnewsamp;proxystylesheet=wnewsamp;output=xml_no_dtdamp;ie=UTF-8amp;oe=UTF-8amp;filter=pamp;getfields=wnnisamp;sort=date:D:S:d1" t_above="true" t_static="true" t_fontcolor="#000000" t_fontface="Verdana,sans-serif" t_bgcolor="#ddedd9" t_width="110" t_delay="50"William A. Mejia/a said in an August 21 report e- mailed today.br /br /Shares of the banks, which include a href="http://www.bloomberg.com/apps/quote?ticker=ADCB%3AUH" t_above="true" t_static="true" t_fontcolor="#000000" t_fontface="Verdana,sans-serif" t_bgcolor="#ddedd9" t_width="110" t_delay="50"Abu Dhabi Commercial Bank PJSC/a, a href="http://www.bloomberg.com/apps/quote?ticker=FGB%3AUH" t_above="true" t_static="true" t_fontcolor="#000000" t_fontface="Verdana,sans-serif" t_bgcolor="#ddedd9" t_width="110" t_delay="50"First Gulf Bank PJSC/a, a href="http://www.bloomberg.com/apps/quote?ticker=DIB%3AUH" t_above="true" t_static="true" t_fontcolor="#000000" t_fontface="Verdana,sans-serif" t_bgcolor="#ddedd9" t_width="110" t_delay="50"Dubai Islamic Bank PJSC/a and a href="http://www.bloomberg.com/apps/quote?ticker=UNB%3AUH" t_above="true" t_static="true" t_fontcolor="#000000" t_fontface="Verdana,sans-serif" t_bgcolor="#ddedd9" t_width="110" t_delay="50"Union National Bank PJSC/a, have already risen by 55 percent this year, although they are still about 50 percent lower than they were a year ago, the report said. a href="http://www.bloomberg.com/apps/quote?ticker=EMIRATES%3AUH" t_above="true" t_static="true" t_fontcolor="#000000" t_fontface="Verdana,sans-serif" t_bgcolor="#ddedd9" t_width="110" t_delay="50"Emirates NBD PJSC/a, the nation’s largest bank by assets, and second-ranked a href="http://www.bloomberg.com/apps/quote?ticker=NBAD%3AUH" t_above="true" t_static="true" t_fontcolor="#000000" t_fontface="Verdana,sans-serif" t_bgcolor="#ddedd9" t_width="110" t_delay="50"National Bank of Abu Dhabi PJSC/a, will face higher non-performing loans this year and a “more challenging” funding environment that will hurt growth, the report said. Although borrowing costs will stay high and slower loan growth will hurt revenue, banks’ “profitability levels in general will remain attractive,” the analysts said.br /br /“There is little to suggest U.A.E. banks should trade at a significant discount to global peers,” the report said.br /br /Goldman Sachs raised its rating on Abu Dhabi Commercial Bank and Dubai Islamic Bank to “neutral” from “sell” and cut National Bank of Abu Dhabi to “sell” from “neutral.” It reduced its rating on First Gulf Bank to “neutral” from a “buy.”br //pp /p/blockquotediv class="blogger-post-footer"img width='1' height='1' src='https://blogger.googleusercontent.com/tracker/819581243324579563-3154839122610596836?l=briskycapital.blogspot.com'//div

China Turning the Screws on Rio Tinto in Iron Ore Negotiations

Contrarian Profits — Sat, 22 Aug 2009 00:41:46 +0000

pChina is pressing Rio Tinto PLC (NYSE ADR: a href="http://www.google.com/finance?q=NYSE:RTP" target="_blank"RTP/a) hard for a sharp reduction in the prices the company charges for its iron ore. But mining companies like Rio, who have had their bottom lines eviscerated by a slump in commodities prices, may have a hard time acquiescing. /p pChina’s a href="http://www.nytimes.com/aponline/2009/08/13/business/AP-AS-China-Steel.html?_r=2#38;scp=5#38;sq=steel%20prices#38;st=cse" target="_blank"470 million ton demand for steel is considerably lower than the country’s annual production capacity of 660 million tons/a, and to that effect, China announced a three-year ban on new mills strongemThe New York Times/em/strong reported./p p“Disorderly competition” has pushed up iron ore prices, caused a glut of production capacity and resulted in “serious losses,” said China’s Information Minister Li Yizhong. “My ministry will not approve any expansion-related projects in the iron and#8230;/p

The End of Cheap Water?

Chris Mayer — Fri, 21 Aug 2009 00:30:06 +0000

pThe price of water is starting to rise in a big way, at least in China. I’ve expected this for a few years./p pTo set the table, strongwater rates in China have been so far below the global average it’s ridiculous./strong Especially when you consider the severe water problems in China. The graphic below is from emThe Wall Street Journal/em (“China Cities Raise Water Price in Bid to Conserve” by Andrew Batson):/p pThe Chinese are water-poor. They are sucking their aquifers dry. It is particularly bad in the north of China. The groundwater under the North China Plains is draining away quickly. By some estimates, China will exhaust this water supply in the next ten years./p p style="text-align: center;"/p pYou probably know that the city of Venice is#8230;/p

Why Asia Will Supplant Detroit as the Global Center of the Auto Industry

Contrarian Profits — Wed, 19 Aug 2009 18:00:55 +0000

pAsia is poised to become the “new” Detroit./p pHere in the United States, at a cost of a mere $3 billion, the “Cash-for-Clunkers” program appears to have given new hope to the U.S. auto industry./p pBut that new hope is destined to be short-lived./p pIt’s true that - in terms of value delivered for the money invested - “Cash for Clunkers” has eclipsed every other stimulus program that has been tried. But the program has a projected lifespan of only three months, meaning it can’t reverse the powerful global forces that are destined to turn the U.S. auto market from leader to laggard on the global stage./p h3Financial Crisis Fallout Reshapes Sector/h3 pThanks to the financial crisis whose impact continues to be felt, worldwide automobile#8230;/p

Trend Condition of Country Funds

Richard Shaw — Tue, 18 Aug 2009 02:04:51 +0000

There were some substantial price moves today for many country and region funds. How do they look now relative to their 200-day simple moving averages? The chart below shows the ratio of the price to the 200-day average, and the 100-day average to the 200-day average, for 35 country and region funds as of end-of-day August [...]

High-Speed Rail Puts Investors on the Fast Track to Profits in China, but Languishes in the U.S.

Contrarian Profits — Tue, 18 Aug 2009 00:36:23 +0000

pUnderstanding that high-speed rail (HSR) could provide millions of Americans with a cleaner, more efficient way to travel, President Barack Obama allocated $13 billion to its development over the next five years as part of the a href="http://www.recovery.gov/" target="_blank"American Recovery and Reinvestment Act/a (ARRA) passed in February./p pBut Obama’s high-speed rail initiative has gotten off to a sluggish start, while a much bigger, $300 billion plan to create the world’s largest and most sophisticated high-speed rail network is already rapidly unfolding in China./p p“Railroads were always the pride of America, and stitched us together. Now Japan, China, all of Europe have high-speed rail systems that put ours to shame,” Obama said in April./p pIn a proposal called “a href="http://www.fra.dot.gov/Downloads/RRdev/hsrspfacts.pdf" target="_blank"A Vision for High-Speed Rail in America/a” Obama and#8230;/p

GrenTech: China Does it Again

Andrew Snyder — Fri, 14 Aug 2009 23:35:14 +0000

pChinese stocks are dominating the domestic equities market. If you think the trend is going to end sometime soon, you had better think again. Winners like China GrenTech (NASDAQ:strong/strongstronga href="http://www.google.com/finance?q=grrf" target="_blank"GRRF/a/strong) are here to stay./p pThere are few certainties in this overbought market, but one common theme lately has been the dominance of China’s small caps. Seemingly every day, a little-known Chinese company is topping the biggest-mover list./p pToday’s list leader is no exception.br / strongbr / China GrenTech (NASDAQ:a href="http://www.google.com/finance?q=grrf" target="_blank"GRRF/a) /strongshareholders are watching their positions surge by nearly 50% as investors try to get their hands on this thinly traded microcap./p pWith an average of just 70,000 shares exchanging hands in any given session, today’s massive trading of over four million shares is a sign investors are willing to#8230;/p

Hot Stocks: With an Emerging Markets Foray, Molson and SABMiller Quench Their Thirst For Global Growth

Jason Simpkins — Wed, 12 Aug 2009 18:24:09 +0000

Obscure Law Forces Companies to Come Clean on Gold Mandatory government filing NI 43-101 required gold mining companies in Canada to disclose how much gold they really have. This one company’s filing just revealed that it’s sitting on the 7th largest gold strike in North American history. Few know about this yet. And for [...]

QA on emerging markets with Mark Mobius

Prieur du Plessis — Wed, 12 Aug 2009 08:09:08 +0000

Short-term corrections aside, Mark Mobius remains bullish on emerging markets. Read on for an interesting interview with him.

With an Emerging Markets Foray, Molson and SABMiller Quench Their Thirst for Global Growth

Contrarian Profits — Tue, 11 Aug 2009 23:30:30 +0000

pWith sales volume plunging in Western markets, Molson Coors Brewing Co. (NYSE: a href="http://www.google.com/finance?q=tap" target="_blank"TAP/a) and SABMiller PLC (OTC ADR: a href="http://www.google.com/finance?q=OTC%3ASBMRY" target="_blank"SBMRY/a) are tapping into emerging markets for refreshing growth./p pSABMiller, for instance, saw beer sales slump 7% in Europe and 0.8% in the United States, while Africa and Asia combined for 11% sales growth. Sales in China alone soared 17% in the quarter./p p“a href="http://www.sabmiller.com/files/reports/ar2009/2009_annual_report.pdf" target="_blank"While demand in Europe has dropped sharply/a, countries in emerging markets such as Africa and Asia have fared relatively well despite falling back from the high - one might say unsustainable rates of growth of recent years,” said SABMiller Chairman Meyer Kahn./p pAs a percentage of commercially produced alcohol, beer now accounts for 49.0% of the market in Africa and 32.8% in#8230;/p

China Bubble Version 2.0

Contrarian Profits — Tue, 11 Aug 2009 19:30:48 +0000

pHow do you say bubble in Mandarin?/p pChinese property sales are up over 60% so far this year, the nation’s National Bureau of Statistics proclaimed yesterday. That puts the housing bubble here to shame. We’ve heard a bunch of nosebleed data points come outta there in the last few weeks… check these out:/p ul liNew loan issuance has tripled in the first half of 2009, to $1.1 trillion. That’s more than half of the entire Chinese GDP over the same period./li liem95% of those loans went to state-owned enterprises or provincial entities/em/li liThe Shanghai Composite is up 79% year to date, the best major market performance in the world/li liStocks on the Shanghai Composite trade for 35.4 times earnings, double that of the MSCI Emerging Markets#8230;/li/ul

$75 Billion in New Treasuries this Week

Contrarian Profits — Tue, 11 Aug 2009 19:00:30 +0000

pCurrencies adrift all day yesterday#8230;Data prints begin today with Productivity#8230;Stop to think! Chinese data is impressive#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Terrific Tuesday to you! Well, no data yesterday left the markets drifting about the open waters. Stocks rebounded, which gave the risk assets a bias to be bought, but for the most part, the day was much like being a drift in the ocean, with no direction or cares!/p pThat will all change beginning today with the Nonfarm Productivity report for the 2nd QTR#8230; Long time readers know my dislike for this data, as I believe it simply shows that one person works longer hours! The Fed Heads used to be all over this data like a cheap suit,#8230;/p

Best Sectors for Income Seekers

Contrarian Profits — Mon, 10 Aug 2009 19:35:11 +0000

pIt’s been a rough year for dividends, but if you know where to look, your income will be just fine. /p pBelow is a breakdown of S#38;P 500 yields by sectors:/p p style="text-align: center;"a class="flickr-image alignnone" title="Dividend Yield" href="http://www.agorafinancial.com/5min/the-debt-ceiling-dividend-plays-a-currency-sea-change-and-more/"/a/p pAs you can see, the biggest loser on the list is financials, which shouldn’t be a surprise. The segment’s dividend yield fell 300 basis points (right-hand column) from last year to now./p pThe sector that pays the most is doing so under the radar: telecommunication services. This is a favorite of ours. That 14 basis point increase is primarily due to AT#38;T (NYSE:a href="http://www.google.com/finance?q=AT%26T"T/a) and Verizon (NYSE:a href="http://www.google.com/finance?q=Verizon"VZ/a) — both paying out around 6%./p pThese dividends aren’t nearly as safe as we’d like, though. Instead of gunning for the U.S. telecom industry, we like to#8230;/p

Best Sectors for Income Seekers

Contrarian Profits — Mon, 10 Aug 2009 19:35:11 +0000

Bloomberg: Mobius Says Stocks Face 30% Correction

Michael E. Brisky — Mon, 10 Aug 2009 15:01:00 +0000

I found this a href="http://www.bloomberg.com/apps/news?pid=20603037amp;sid=a2uzw71az3O0"interesting story /aabout emerging market specialist Mark Mobius. I've copied a couple of quotes here:br /br /blockquotepMark Mobius said global stocks will drop as much as 30 percent following their recovery from last year’s rout as companies take advantage of the rebound to sell more shares.br //pp“When you have these rapid increases, almost without correction, you will definitely have a correction at some point, so we can expect a lot of volatility,” Mobius, the executive chairman of Templeton Asset Management Ltd. said in an interview in Kuala Lumpur today. “Increases of 70 percent will be followed by decreases of 20 to 30 percent.”br /br /The biggest risk for global stocks is the increase in initial share sales and bond issues, Mobius said today. Investors will be “selling to take up new stocks, that will impact the prices,” he said. Mobius, who oversees about $25 billion, on July 29 said he plans to double Templeton Asset Management’s emerging-market assets within two years.br /br /The so-called correction “can happen anytime, probably this year,” Mobius said. “It may not be all at once, you may not see a decrease of 20 percent suddenly, it could be 10 percent here, and a rise of 5 percent then another 10 percent, you’ll see this kind of volatility in the markets.” He added that he was referring to shares “globally.”br /br /“I don’t think it’s a bubble,” because “you don’t have the irrational exuberance so to speak that you would normally find in a bubble activity,” Mobius said. The government’s policies to rein in bank lending are a “good thing,” he said.br //p/blockquotebr /My take on this: This is the line of thinking that I tend to align with. If you look back last week, I a href="http://briskycapital.blogspot.com/2009/07/couple-of-afternoon-links.html"posted some commentary /aby Ken Fisher where he said there is "zero incentive" for China to curb lending. I agree with Mobius. br /br /I think a correction is only natural after a strong bounce back rally. If we don't see a correction, it would likely lead to a good sized bubble in emerging markets, if that hasn't already begun.br /br /I say this not to imply that emerging markets aren't good investments. They will be leading growth for many years to come. Its more just a shorter term trend that I'm looking at. I still like China and particularly Brazil.div class="blogger-post-footer"img width='1' height='1' src='https://blogger.googleusercontent.com/tracker/819581243324579563-1127108462704603327?l=briskycapital.blogspot.com'//div

The Secrets to Global Dividend Investing

Contrarian Profits — Fri, 07 Aug 2009 00:24:39 +0000

pIf you want a stable dividend, focus on global companies. Dividends still matter. But you have to know a href="http://www.oxfonline.com/mm_webinar/summit_cj.html" target="_blank"where to look/a./p pA record setting 367 companies reduced their dividends during the second quarter, no doubt leading many shell-shocked investors to conclude that income is dead./p pBut there’s more to this story. A total of 283 companies actually said that they boosted their payouts, and an even-larger group of companies maintained their current dividend payouts, a href="http://www.google.com/finance?cid=4907797" target="_blank"Standard #38; Poor’s Inc/a. reported./p pNot surprisingly, each of the two groups of companies featured some defining characteristics. The companies that had cut their dividends were largely domestic in nature, or at least had a decidedly domestic emphasis. By and large, the firms that were able to maintain or#8230;/p

The Brewer’s Art: Beer Companies Quench Their Thirst For Growth by Tapping Into Emerging Markets

Jason Simpkins — Fri, 07 Aug 2009 00:17:57 +0000

1,100 People Just Learned How To Collect $4,000 In One Month No tricks or “catches” were involved. No fancy investment “plays” either. In fact, the $4,000 was guaranteed. No ifs, ands, or buts. All these people had to do to get this money was take a few simple steps every investor knows how to do [...]

Emerging Markets… A Contrarian Take

Investment U — Thu, 06 Aug 2009 19:37:12 +0000

Emerging Markets… A Contrarian Take by Louis Basenese, Advisory Panelist Editor’s Note: We apologize for anyone who tried to reach our website over the last few days. One of the perils of our globally interconnected web is that we – like many high profile companies – are constantly under invasion from malicious web attacks. To say emerging markets [...]

With Its Economy Ignited by Stimulus Spending, China Is Leading the Global Recovery

Contrarian Profits — Mon, 03 Aug 2009 16:30:42 +0000

pChina’s economy grew by 7.9% in the second quarter, exceeding most analysts’ expectations, and lending credence to Beijing’s goal of 8% annual growth. Now, with the nation awash in liquidity and the economy picking up steam, the only task ahead of the central government is deciding when to rein in lending and let the economy stand on its own two feet./p pThe momentum behind China’s economy is staggering./p p#8220;a href="http://www.google.com/hostednews/ap/article/ALeqM5iBJZ40edyOp6ERIan-_6PmgP3E1wD99LGBSO0" target="_blank"China is increasingly becoming a responsible citizen in the global community/a,#8221; economist Allen Sinai of Decision Economics told strongemThe Associated Press/em/strong. #8220;No longer lawless, no longer difficult to deal with, much more responsible. It is now a powerhouse among economies and finance. And it’s a rich country.#8221;/p pIn just the past few weeks, two of the#8230;/p

Buy, Sell or Hold: The Coca-Cola Company (NYSE: KO) Continues to Deliver Knockout Profits

Contrarian Profits — Mon, 03 Aug 2009 14:51:38 +0000

pBack on a href="http://www.moneymorning.com/2009/02/17/ko-coca-cola/" target="_blank"Feb. 17, as the market was on sell-off mode, I recommended buying/a strongThe Coca-Cola Co./strong strong(NYSE: a href="http://www.google.com/finance?q=ko" target="_blank"KO/a)/strong. The stock is up some 16% from our entry point. That’s because Coca-Cola recently reported a near-20% jump in profit, which soared to 67 cents a share, excluding restructuring charges./p pCoca-Cola beat earnings, increased guidance, increased dividends and reinstated its stock buyback program. The company plans to repurchase $1 billion in shares of stock in the second half of 2009. What more do we need? The answer is: Consistent performance./p pAs I tracked the developments in Coca Cola and their global markets, I ascertained that my original view remains unchanged and Coca Cola should keep growing profits consistently, which should keep propelling its stock up./p pRemember, on March 9,#8230;/p

ABB Wins $540 Million Order in Brazil

Michael E. Brisky — Sat, 01 Aug 2009 18:38:00 +0000

I'm a shareholder and pretty frequent follower of Swiss industrial/electrical company ABB (a href="http://finance.yahoo.com/q?s=ABB"ABB/a). They are constantly getting new orders, and I don't report them all, but a href="http://www.abb.com/cawp/seitp202/06c9cd09d993758cc1257601003db274.aspx?leftdb=abbzh250amp;v=553Eamp;e=us"this is a big one/a.br /br /blockquoteABB, the leading power and automation technology group, has won orders worth over $540 million from the Abengoa Group to deliver the key technology for the world’s longest power transmission link to be constructed in Brazil. pThe power highway will link two new hydropower plants in the northwest of the country with São Paulo, Brazil's main economic center, over a distance of 2,500 kilometers. Power will be transmitted at very high voltage (600 kilovolts) to minimize transmission losses.br /br /This will be the second transmission project in Brazil using HVDC (high-voltage direct current) at 600 kV. The Itaipu project, with two transmission lines built by ABB in 1984 and 1987, is the world’s highest-voltage DC power transmission system currently in operation. ABB pioneered HVDC transmission technology more than 50 years ago and remains the world leader in this domain.br /br /“HVDC technology is ideally suited for the efficient transmission of renewable energy generated in remote areas, such as hydropower,” said Peter Leupp, head of ABB’s Power Systems division. “With the Itaipu project celebrating 25 years of successful operation this year, ABB is proud to continue partnering Brazil in its ongoing efforts to strengthen the country's power network.”br /br /ABB will provide two 3,150 megawatt HVDC converter stations, and an 800-MW HVDC back to back station to transmit power to São Paulo and the alternating current network in the northwest of the country. The stations are scheduled for completion in 2012 and are a part of the government’s Accelerated Development program.br /br /HVDC has lower losses and a smaller footprint than traditional AC transmission systems, and is able to stabilize intermittent power supplies that might otherwise disrupt the grid. For these reasons, it is the technology of choice for long-distance transmission projects which can deliver electricity from remote generation sources to the centers where it is needed.br /br /Abengoa is a technology-based company that applies innovative solutions for the sustainable development of the infrastructure, environmental and energy sectors. It is present in more than 70 countries, where it operates with its five Business Groups: Solar, Bio-energy, Environmental Services, Information Technology and Industrial Engineering and Construction.br /br /ABB (www.abb.com) is a leader in power and automation technologies that enable utility and industry customers to improve performance while lowering environmental impact. The ABB Group of companies operates in around 100 countries and employs about 120,000 people.br /br / /p table class="standard" width="100%"tbodytr class="headerRow" valign="top"th width="100%"Rio Madeira will be the longest HVDC link ever built /th/tr tr class="altRow" valign="top"td width="100%"img src="http://www04.abb.com/global/seitp/seitp202.nsf/0/2054723516a3f819c125760100494bb0/$file/HVDC_Brazil_09_map.jpg" width="538" border="0" height="462" /br /The 2,500-kilometer long high voltage direct current transmission link will connect two new hydropower plants in northwest Brazil with São Paulo, the country's main economic center on the east coast. Power transmitted at very high voltage (600 kilovolts) will minimize electricity losses.This is the second ABB-built power link in Brazil using 600-kV HVDC transmission./td/tr/tbody/table/blockquotebr /ABB is at the center of the "growing faster than the rest of the world, which is contracting" emerging markets. Brazil is a great market that is commodity independent, and is experiencing solid growth. br /br /Their stock has been moving as it trades as a proxy to emerging markets at this point (even though they get a lot of orders in Europe). They haven't been unscathed in this recession, but appear to being positioned for good performance once we return to more normal times.br /br /Not buying the stock here, but would add if we got back to the lower teens again.br /br /Disclosure: Long ABB.div class="blogger-post-footer"img width='1' height='1' src='https://blogger.googleusercontent.com/tracker/819581243324579563-7526625744318461562?l=briskycapital.blogspot.com'//div

Beware of the Obama Stimulus Trap

Contrarian Profits — Fri, 31 Jul 2009 21:00:44 +0000

pUpbeat headlines have been everywhere in recent weeks, and they all seem to point to a single conclusion: The U.S. economy is in the early stages of a very rapid recovery./p pIn fact, when you peruse the news it’s difficult to come to any other conclusion. For instance:/p ul liA number of key earnings reports have been much better than expected, and company executives buttressed those profit figures with positive comments about the next 18 months./li liThe trading operations of Goldman Sachs Group Inc. (NYSE:a href="http://www.google.com/finance?q=NYSE%3AGS" target="_blank"GS/a) and JPMorgan Chase #38; Co. (NYSE: a href="http://www.google.com/finance?q=NYSE%3AJPM" target="_blank"JPM/a) a href="http://www.moneymorning.com/2009/07/17/jpmorgan-chase-accounting-mirage/" target="_blank"both just reported record profits/a./li liU.S. housing prices rose in May a href="http://www.moneymorning.com/2009/07/30/housing-market-bottom/" target="_blank"for the first time in three years/a. Initial jobless claims have plunged 15% since their April peak. The Conference Board’s Index of#8230;/li/ul

Dollar Rally Peters Out

Contrarian Profits — Thu, 30 Jul 2009 19:30:26 +0000

pObama defends his policies#8230;Commodity currencies should outperform#8230;Global Power Shift Index#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And happy Thursday to everyone! Hope everyone made it through the #8216;hump day#8217; with no worries. We started the morning here with rainshowers, but it ended up being a beautiful afternoon and evening. Currency markets were similar to the weather here, as most currencies started Wednesday in the loss column vs. the US$, but rallied as the day progressed. The dollar had strengthened over the past couple of days due to #8217;safe haven#8217; demand; but a surprisingly strong durable goods number (ex autos) combined with an #8216;all clear#8217; signal from President Barack Obama had investors moving back into riskier assets. The commodity based currencies also got#8230;/p

Get Ready for Another Crash

Bill Bonner — Thu, 30 Jul 2009 19:00:19 +0000

pComes word this morning that the a style="font-weight: bold; color: #006b99;" href="http://www.cscec.com.cn/english/index.htm" target="_blank"China State Construction Engineering company/a has gone public. strongIt’s the biggest public offering – at $7.3 billion – in more than a year/strong. It’s also China’s biggest homebuilder. And as soon as the shares hit the market yesterday they soared#8230; closing 56% higher than the IPO price. At that price, it trades at about 40 times forecast 2009 earnings. /p pWhy would you pay 40 times earnings for a homebuilder? It’s a fairly easy business to enter. No barriers to entry that a little money#8230; a few connections#8230; and a circular saw can’t overcome. With no barriers to entry, profit margins are always squeezed by competition. And growth is limited too#8230; other builders are always starting#8230;/p

China Turns it Up Another Notch

Contrarian Profits — Wed, 29 Jul 2009 00:30:43 +0000

p class="byline"Here it comes, slowly but surely: “We sincerely hope the U.S. fiscal deficit will be reduced, year after year,” China’s Assistant Finance Minister Zhu Guangyao said overnight after talks with Treasury Secretary Geithner. Could he lay it out any more clearly than this? /p p class="byline"“The Chinese government is a responsible government, and first and foremost our responsibility is the Chinese people, so of course we are concerned about the security of the Chinese assets.”/p pThe Chinese now own over $801 billion in U.S. debt, nearly double their holdings at the start of 2007 and by far the world’s largest stash of American paper./p p“We are committed,” responded Tim Geithner, “to taking measures to maintaining greater personal saving and to reducing the federal deficit#8230;/p

ABB Still Well Positioned

Michael E. Brisky — Sat, 18 Jul 2009 15:46:00 +0000

In doing my normal Saturday reading, I came across a a href="http://online.barrons.com/article/SB124786932728760309.html"feature in Barrons/a about Swiss industrial/electrical giant ABB (a href="http://finance.yahoo.com/q?s=ABB"ABB/a). I've held shares in this company for about a year, and I continue to like this company, even though it has hit a rough patch (who hasn't?) Here's a couple of meaningful quotes from the Barron's feature:br /br /ulliABB's fortunes in the past year have been dented by exposure to the automobile and construction industries, but the Swiss engineering giant's power-transmission and distribution activities should continue to generate earnings that offset the weakness./liliProduct mix and geographic diversity so far have insulated span id="ataglance_stock_DWC_label" class="chartToolTip" onmouseover="com.dowjones.rolloverQuotes.show(this,'abb');" onmouseout="com.dowjones.rolloverQuotes.hidelater();" a class="verdana rolloverQuote" href="http://online.barrons.com/public/quotes/main.html?type=djnamp;symbol=abb"ABB/a/span (ticker: ABB) from the worst of the recession, and it looks well positioned to prosper. Its balance sheet is still one of the best in the industry, with $2 billion in net debt and nearly $5 billion in cash giving the company a solid financial buffer and a war chest for acquisitions./liliThose prospects aren't reflected in ABB's shares. The stock has shed about one-third of its value during the past 12 months; late Friday, ABB's American depositary receipts were trading at $16.15. The Dow Jones Europe Stoxx 600 industrial-goods and services sector has fallen about 25% during the same period. ABB trades at a trailing 12-month average price/earnings ratio of 11.3 times./li/ulbr /Their automation and robotics sectors are getting hit pretty hard. But their power systems and process automatic sectors are really doing well(up 36 and 10 percent YOY respectively) , as they are picking up orders all over the world. These guys are specifically hitting it hard in emerging markets. In fact, their order growth in the Middle East and Africa is up 119% year over year, and now making up 21% of all orders.br /br /They are well diversified with their four largest business segments making up 29, 24, 23, and 22 percent of all orders.br /br /ABB is right at the center of alternative energy production as well. Think up smart grid technology, which is just starting to expand, as well as wind and solar products, and we all know the potential of those.br /br /If you have time, check out this presentation detailing their latest updates in the industry and how they stand as a company. a href="http://www02.abb.com/global/abbzh/abbzh259.nsf/bf177942f19f4a98c1257148003b7a0a/e28aa3a5106f5d26c12575b6003a19b8/$FILE/EPG%20Conference%202009%20.pdf"Click to view presentation/a (pdf).br /br /The bottom line here is that although they are still being hurt by the recession, its a company that is holding up well (almost 5billion in net cash), and will certainly be strong when the economy recovers. Stock wise, it has hovered in the 15-16 range for quite some time. They report earnings this week, and we should get a clearer picture on where orders are coming in. If we get any negative reaction from the market, I might very well use the opportunity to add shares.a onblur="try {parent.deselectBloggerImageGracefully();} catch(e) {}" href="http://4.bp.blogspot.com/_VQGtBvsQTCg/SmHzH9eNB5I/AAAAAAAABTs/HUyc9SzgjIQ/s1600-h/smart+grid.GIF"img style="margin: 0px auto 10px; display: block; text-align: center; cursor: pointer; width: 400px; height: 253px;" src="http://4.bp.blogspot.com/_VQGtBvsQTCg/SmHzH9eNB5I/AAAAAAAABTs/HUyc9SzgjIQ/s400/smart+grid.GIF" alt="" id="BLOGGER_PHOTO_ID_5359832349633480594" border="0" //abr /br /Disclosure: Long ABB.div class="blogger-post-footer"img width='1' height='1' src='https://blogger.googleusercontent.com/tracker/819581243324579563-60009171104323895?l=briskycapital.blogspot.com'//div

China Booms… Too Good to be True?

Contrarian Profits — Fri, 17 Jul 2009 19:45:00 +0000

pChina has once again snatched the leadoff spot in our daily lineup. And once again, they’ve knocked the cover off the ball. The Chinese economy expanded at a dizzying 7.9%, their government announced yesterday. That far exceeds analyst expectations and China’s still-impressive 6.1% first-quarter growth. /p pConveniently, the second-quarter jump — plus revised GDP growth expectations of 8% in the third quarter and 9% in the fourth — puts China perfectly on track for the 8% annual growth they promised earlier this year./p pLooking through the fine print of today’s data… oy, these are some la-la land numbers:/p ul liNew lending in the first half soared 201% compared to the year before/li liFirst-half property sales up 53% per annum/li liChinese home prices are growing at a 10%#8230;/li/ul

Profit From the “New Decoupling”

Investment U — Thu, 16 Jul 2009 20:39:57 +0000

Profit From the “New Decoupling” Tony Daltorio, The Investment U Research Team Emerging markets first hit investors’ radar screen about 20 or so years ago. There was a lot of skepticism and a lack of understanding about emerging markets, which was understandable because there were few emerging markets open enough (or large enough) [...]

International Destinations for your Portfolio

Daniel Hung — Thu, 16 Jul 2009 04:32:36 +0000

Intel’s forecast, today, highlighting their belief that Asian consumers would drive the economic rebound got me thinking. Could international stocks recover quicker and grow faster than domestic U.S. stocks over the next few years? To get a better grasp, I’ve decided to compare the performance of various international ETFs and take a better look. In the [...]

Mark Mobius on the outlook for emerging markets

Prieur du Plessis — Sat, 11 Jul 2009 06:42:51 +0000

“The outlook for emerging markets remains positive thanks to their relatively strong fundamental characteristics and faster growth than their developed counterparts,” said emerging markets guru Mark Mobius in this guest contribution.

The Debate is Over. China Wins!

Andrew Snyder — Thu, 09 Jul 2009 23:30:29 +0000

pChina is pouring hundreds of billions of dollars into its economy trying to permanently displace its reliance on American money. With more than a trillion dollars up for grabs, are you ready to get your share?br / Forget about a quickly inflating bubble that could lead to devastation in just a few years, China wants growth and it wants it now./p pThanks to Beijing’s recent $586 billion stimulus attempt, the country is growing at a pace that is stomping the rest of the economically depressed world./p pInstead of following Bernanke and Geithner’s plans to revive the economy through monetary policy, China is following a purely fiscal strategy. With a fixed currency and a slew of massive state-owned corporations, spending easy money is about all#8230;/p

Could a BRIC Alliance Crash the Dollar?

Contrarian Profits — Wed, 08 Jul 2009 12:01:55 +0000

pThe G-8 summit starts today in L’Aquila, Italy. The G-8 are the old guard: US, UK, Germany, France, Italy, Japan, Canada and Russia. And their opinions are starting to look a little redundant in the aftermath of the credit crisis./p pThe credit crisis has shifted the balance of power. Not since the days of the conquistadors has there been such an imbalance. Back then the Pope was the ultimate power and carved the New World in two between Spain and Portugal. Now it#8217;s the split between old and new economies./p pThe levels of debt raised by the developed nations to bail out their banking systems is crippling compared to the emerging nations. According to recent International Monetary Fund forecasts by 2014 the#8230;/p

Oil Prices Due for a Short-Term Setback, Although Long-Term Outlook Remains Bullish

Contrarian Profits — Mon, 06 Jul 2009 16:01:40 +0000

div class="entry" pWhile the long-term outlook for oil prices remains bullish, don’t be surprised to see a near-term correction. After tumbling to a low of $33.98 a barrel on Feb. 12, crude oil more than doubled in price, soaring to $69.82 on the New York Mercantile Exchange (Nasdaq: a href="http://www.google.com/finance?q=NASDAQ%3ACME" target="_blank"CME/a) – before tumbling nearly 4% on Thursday on a worse-than-expected jobs report./p pIndeed, strongema href="http://www.moneymorning.com" class="alinks_links"Money Morning/a/em/strong predicted precisely that kind of a run-up for crude oil, a href="http://www.moneymorning.com/2008/12/29/oil-2009/" target="_blank"first in January/a and then a href="http://www.moneymorning.com/2009/04/16/opec-oil-prices/" target="_blank"again on April 16/a./p pAs a basis for those previous analyses of the oil market, we cited the declining value of the U.S. dollar, falling production, and the possibility that demand for oil would soar as the global economy emerges from the worst financial crisis since World War II. And those factors#8230;/p/div

Gold Will Blast Above $1,000 Per Ounce Within 100 Days!

Contrarian Profits — Thu, 02 Jul 2009 22:23:30 +0000

pIt’s just a matter of time before $1,000 becomes the floor price for gold. Once gold breaks above the $1,000 per ounce psychological resistance level, the sky is the limit. Gold could easily hit $1,200 or even $1,300 per ounce by year end. But you must act fast, because you may never see gold under $1,000 per ounce again. Investors that position themselves correctly today will have the opportunity to make 100% or more gains in the months ahead. Let me explain why…/p pInflation is just one of the reasons to buy gold. The U.S. government is on track to spend $1.8 trillion more this year than it brings in. America’s national debt is well over $11 trillion. This is the#8230;/p

EPS Forecasts Portend Positive Market … Sort Of

Richard Shaw — Thu, 02 Jul 2009 02:56:28 +0000

If the consensus earnings estimates coming out of Standard & Poor’s and “the Street” (via Thompson Reuters) are realistic, then it looks pretty good for a stable to rising market value. We say value instead of prices, because price and value don’t always coincide. At 923 the S&P 500 is about 12 times the 2010 $74.10 [...]

China Has Stopped Stockpiling Metals

Dan Denning — Wed, 01 Jul 2009 20:45:46 +0000

pChina has stopped stockpiling metals, according to reports in the Chinese media. Will this put the cap on the recent strength in base metals prices? The AFP reports that, #8220;China has been building its inventories of metals, including 235,000 tonnes of copper, over recent months, Caijing magazine reported on its website over the weekend, citing Yu Dongming, an official with the state economic planner.#8221;/p p#8220;China also bought 590,000 tonnes of aluminium, 159,000 tonnes of zinc, 30 tonnes of indium and 5,000 tonnes of titanium, said Yu, who works in the National Development and Reform Commission#8217;s industry department.#8221; Now that metals prices have rebounded, though, will the stockpiling continue, even at high prices? Or was it a case of bargain shopping at#8230;/p

What’s Next for the Fastest-Growing Foreign Markets?

Andrew Gordon — Tue, 30 Jun 2009 22:45:47 +0000

pIt’s the perfect time to make money from some of the world’s fastest-growing markets as long as you invest in them the right way./p pSeveral countries have seen their markets surge in the past three months: India’s market shot up 50.3 percent, Indonesia’s 39.5 percent, Singapore’s 32.8 percent, Russia’s 32.5 percent, Hong Kong’s 31.7 percent, and Chile’s 29.6 percent. But the world’s most expensive major market rose a relatively modest 24 percent. Take a look at the chart…/p p style="text-align: center;"/p pTaiwan’s market is outrageously expensive. In terms of price-to-earnings (P/E), it’s going for almost twice the P/E ratio of the UK’s – the next most expensive market./p pThings are beginning to look up in Taiwan. Its big chip sector is seeing light at the end#8230;/p

The Next Saudi Arabia

Byron King — Mon, 29 Jun 2009 20:45:14 +0000

pThe oil resources off Brazil are in the same scope as those of Saudi Arabia. The oil potential is huge. Beyond huge. It’s a game changer for the world of energy. No, the Brazilian resource doesn’t mean that Peak Oil is history. But it does mean that history is about to change. Indeed, the angel of history is favoring the nation of Brazil./p pThe problem with the oil offshore Brazil is that the hydrocarbons are far out — up to 200 miles into the open ocean. They’re under one-two miles of seawater, and then buried under three-four miles of rock and salt. It won’t be easy to define the resource, or to extract it. Still, the investment opportunities are there./p pOne of#8230;/p

Buy, Sell or Hold: The TSW/Claymore Tax-Advantaged Balanced Fund is a Diversified Profit Play with a High Yield

Contrarian Profits — Mon, 29 Jun 2009 14:49:46 +0000

pLast week was a very important one. The U.S. Treasury placed a record level of debt, the Federal Reserve announced it would not expand its monetary easing, and we got many top players opining about the economy. In addition, we are facing the uncertainties about ‘a href="http://en.wikipedia.org/wiki/Cap_and_trade" target="_blank"Cap and Trade/a’ legislation and the healthcare reform. /p pAnd to cap it all, we are about to close the first half of 2009, with all the consequences in terms of portfolio adjustments that need to take place./p pThe Treasury debt placement was well received by the markets. We saw these issues amply oversubscribed and trading well after their placement. This was very encouraging. End of the half adjustments also saw a bid coming back into the#8230;/p

Emerging Markets: Leading or Following?

Richard Shaw — Sat, 27 Jun 2009 23:00:32 +0000

Are emerging markets leading the developed markets forward, or following their lead? The answer may depend on when you start the observation. Two key asset classes are stocks and bonds. Let’s look at total stocks and sovereign bonds for each of the United States, the non-US developed markets, and the emerging markets to see how they [...]

Monday Will Be a Big Day for These Two Emerging Market Nations

Contrarian Profits — Fri, 26 Jun 2009 19:50:41 +0000

pKeep an eye on the Chinese and Brazilian stock markets on Monday./p pThe two emerging market nations - both members of the BRIC group (Brazil, Russia, India, and China) - will each welcome a major new IPO to their respective stock markets./p pThe fact that they’re debuting on the same day is purely coincidental, but the story here is that both are very significant not only to their own countries, but could also underpin the emerging market area./p pLet’s take a look at these IPOs in the context of the broader emerging market topic… the effect this often volatile but flourishing pack of nations is having on the global economy - and how you can hitch a ride…strong/strong/p pstrongEmerging Markets Rebuilding Momentum/strong/p pIn the excellent#8230;/p

BRIC to BIC to BICI?

Richard Shaw — Thu, 25 Jun 2009 16:29:00 +0000

Goldman Sachs coined “BRIC” for Brazil, Russia, India and China. Some commentators have recently suggested that Russia’s stocks are too volatile, economy too fragile and politics too hostile to capital, and that maybe “BIC” is more attractive. Based on the recently released forecast for GDP growth by the World Bank and the OECD, maybe “BICI” [...]

Commodity Bulls Snared by China Stimulus Snafu

Justice Litle — Thu, 25 Jun 2009 15:45:06 +0000

pSome of China#8217;s stockpiling may well have been due to speculative excess, rather than any rational plan on the ground. That realization played a role in the market carnage seen this week./p pAs emGrant#8217;s Interest Rate Observer/em has been known to say, #8220;We wrote it. Did you read it?#8221;/p p style="PADDING-LEFT: 30px"emMy slim hope is that the Chinese really and truly know what they are doing, because, in fueling investor optimism with such flair, they are playing a high stakes game. My worry is that they drop the ball, somehow, and the result shows up as a violent wake-up call for #8220;high beta#8221; assets#8230; emerging market equities, energy, commodities and the like./em/p p style="PADDING-LEFT: 30px"emWhat happens next is far from clear. The huge [commodity] stockpiles could continue to#8230;/em/p

Buy What China Buys, Part II

Chris Mayer — Thu, 25 Jun 2009 15:05:41 +0000

pChina is hungry…and gets hungrier every day. Satisfying hunger requires fertilizer…lots of it. Think: Potash. China is not only getting hungrier, it is also developing a taste for the good life. Protein consumption always increases as a population’s wealth increases. /p pThat’s because wealthy populations tend to eat more meat than poor ones, while also eating more fresh fruits and veggies. The diet becomes more diverse, less centered on consuming base grains./p pThe demand for grains doesn’t diminish, though, because the need to produce meat increases the demand for grains exponentially. Depending on who’s doing the math, five to ten pounds of grain goes into every pound of beef that lands on a dinner plate./p pChina’s population is also increasing, of course, which#8230;/p

German Investor Confidence Is On The Rise…

Contrarian Profits — Tue, 16 Jun 2009 19:17:39 +0000

pCurrencies stop the dollar#8217;s run#8230;BRIC meeting could get ugly for the dollar#8230;RBA meeting notes good for Aussie dollars#8230;Depressing data / forecasts for housing#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Terrific Tuesday to you! Thundering storms moved through here this morning, as I was preparing to leave home and drive to the office. As slow as I am with getting around these days, I got pretty wet from my car to the office building. But, I didn#8217;t melt, as most would have thought! HA! And, I#8217;ll dry out soon enough#8230; Well before anyone else comes in!/p pOK#8230; Well#8230; When I left you yesterday, the dollar was on a rampage, from the comments by the Russian Finance Minister, Kudrin#8230; Was it an overreaction,#8230;/p

Forex Trading: An Interview With Forex Market Expert Thomas Fischer, Part 1

Investment U — Mon, 15 Jun 2009 21:14:17 +0000

Forex Trading: An Interview With Forex Market Expert Thomas Fischer, Part 1 by Dr. Scott Brown, Education Director of Investment U Forex trading is hot, hot, hot right now. And one of the biggest reasons why is that traders are using leverage to amplify returns by 200 times - where $1 controls $200 worth of foreign currency. [...]

QA on emerging markets with Mark Mobius

Prieur du Plessis — Sun, 14 Jun 2009 05:55:16 +0000

This post features a Q&A on emerging markets with Mark Mobius.

Over-Weight Emerging Markets

Richard Shaw — Fri, 12 Jun 2009 23:16:18 +0000

Everybody has a different stock / bond /cash allocation that is best for them. Whether the selected equity allocation is high or low, we think over-weighting emerging markets and under-weighting developed markets within the allocation is the better long-term strategy for long-term investors — except for investors currently relying on, or about to rely on, [...]

The Fate of This Rally May Rest in China’s Hands

Justice Litle — Fri, 12 Jun 2009 21:00:57 +0000

pThe fate of the global equity market rally now comes down to China. Will it continue to stockpile hard assets? Will the data points continue to soothe and impress? Much is at stake either way#8230; /p pIf you grew up in the United States, you know that English literature is one of those subjects they foist upon you in 10th grade or so. I recall very little from English Lit 101. Most of the stories and poems we read (or pretended to read) have become a hazy blur./p pBut after all these years, one poem still stands out. Due to its oddness and simplicity, I have never forgotten it. The poem is #8220;Red Wheelbarrow#8221; by William Carlos Williams, and it goes like#8230;/p

Brazil’s National Commitment to Energy – Bankrolled by China

Byron King — Fri, 12 Jun 2009 20:27:38 +0000

pBrazil is making a national commitment to develop energy resources located far offshore in the South Atlantic. Indeed, no nation has ever advanced such an ambitious plan for long-term comprehensive offshore development. And it’s being bankrolled by China./p pMuch of Brazil’s South Atlantic development will require emdrilling wells in waters up to two miles deep, through four-five miles of rock beneath the seabed/em. The prize at the end will be oil deposits with reserves estimated in the tens of billions of barrels. With access to this offshore bounty, Brazil expects to take its place among the first ranks of energy-producing nations in the world./p pBrazil’s state-controlled national oil company (NOC), Petroleo Brasileiro SA (NYSE:a href="http://www.google.com/finance?q=NYSE:PBR"PBR/a) plans to spend over $175 billion in the#8230;/p

Decoupling Is Still Dead And Here’s The Proof

Louis Basenese — Wed, 10 Jun 2009 20:33:00 +0000

pLast August, in an exclusive article to ema href="http://www.OxfordClub.com" class="alinks_links"Oxford Club/a/em members, I badmouthed decoupling - the theory that the rest of the world (particularly emerging economies) could somehow party on while the U.S economy endured a recession./p pA quick glance at the scoreboard proves my criticism was spot-on…/p pWhile the S#38;P 500 Index slumped 38.5% in 2008, 30 countries witnessed drops of 50% or more. Even more telling, the poster children for the decoupling trade: Brazil (-41.2%), Russia (-72.4%), India (-52.45%) and China (-65.39%) didn’t escape punishment either, despite wild predictions they would…/p pClearly, the old adage still applies, “When the United States sneezes, the rest of the world catches a cold.” (Or in some cases, like Russia, they get pneumonia.)/p pSo why resurrect the past?#8230;/p

Decoupling Is Still Dead And Here’s The Proof

Investment U — Tue, 09 Jun 2009 20:51:59 +0000

Decoupling Is Still Dead And Here’s The Proof by Louis Basenese, Advisory Panelist Senior Analyst, The Oxford Club Last August, in an exclusive article to Oxford Club members, I badmouthed decoupling - the theory that the rest of the world (particularly emerging economies) could somehow party on while the U.S economy endured a recession. A quick glance at the [...]

The Case for Asian ETFs, expected to be worth up to $2 trillion globally by 2011

ETF Daily News — Mon, 08 Jun 2009 13:48:07 +0000

ETF Investors Buy in May

ETF Daily News — Fri, 05 Jun 2009 12:39:10 +0000

ETF investors seemingly ignored the old stock market adage: “Sell in May and go away.” In fact, the ETF industry posted its best month of the year, in terms of net inflows, attracting more than $14 billion in new assets during the month. For some context, this compares with May 2008 net ETF inflows of [...]

Chinese Hummers Just a Sign of the Times

Contrarian Profits — Wed, 03 Jun 2009 21:00:00 +0000

pAs you’ve likely heard, stronga Chinese company will soon own the Hummer brand./strong Heh, let’s count the ways this transaction epitomizes the new economic landscape#8230;/p p1. A Chinese company now owns an automaker that will build and sell cars in the U.S. – a first./p p2. That company – Sichuan Tengzhong Heavy Industrial Machinery – doesn’t even make cars. For its first foray into passenger automaking, it’s chosen Hummer, perhaps the world’s most challenging and polarizing brand./p p3. Business is so booming at Tengzhong HIM (its core is road construction and energy equipment) that the company will completely self-finance the deal…not one yuan borrowed from the Chinese government./p p4. While neither party will disclose the price, Hummer was likely sold for a song…less than $500#8230;/p

A Storm on the Horizon

Bill Bonner — Wed, 03 Jun 2009 20:19:57 +0000

pDow, Oil and Gold all Doing Well./p pYesterday was beautiful in London. We wandered along the banks of the Thames and crossed Waterloo Bridge over to Covent Garden. Everywhere, people were sitting out on the grass#8230; standing outside pubs#8230; walking hand in hand. Everyone had the same idea – to take advantage of the nice weather before it goes away./p pLast year, London had a beautiful summer too. But we were gone that week and missed it./p pAlas, many of the best things in life are fleeting. And thankfully, so are the worst things./p pWhat put us in such a reflective mood were yesterday’s news reports. The Dow rose again – up 19 points this time. Gold edged closer to the $1,000 mark –#8230;/p

The Russia Pick I Recommended to You Is Up 39 in 53 Days

Contrarian Profits — Mon, 01 Jun 2009 20:50:20 +0000

pFor quite some time I was interested in recommending that my readers invest in Russia. I still had concerns about some political issues and organized crime in the country. Most experts out there tell people to stay away from Russia, so I knew I had to do further research myself./p pOne day I told my lovely wife to get her passport ready because we were going to Moscow. She was quite excited because Moscow is a shopping mecca with many historical sites to see. But, I assure you—I was there for business./p pWe traveled to Russia in December of last year and I saw firsthand how the country operates. I observed that the Russians are a hard working and productive people that#8230;/p

High risk also brings potential for high reward, play this risk with ETFs

ETF Daily News — Mon, 01 Jun 2009 16:28:31 +0000

Our proprietary seasonality charts point to emerging markets as the most likely field from which to net profits in June. True, other fields offer opportunities, from inflation-protected bonds where I like the iShares Barclays Tips Bond exchange-traded fund (TIP) , to continued strength among mid-and small-cap stocks both here and abroad. But when I look at our [...]

Investment Guru Richard Russell’s Favorite Chinese Stock

Contrarian Profits — Fri, 29 May 2009 22:09:44 +0000

pHere´s a note about a compelling stock story from legendary newsletter writer Richard Russell./p pThis from Russell:/p blockquotepI usually don#8217;t spend a lot of time touting one stock. But there is one stock that fascinates me. It#8217;s the Chinese stock, a href="http://www.google.com/finance?q=HKG%3A0285"BYD/a. BYD is run by CEO Wang Chuanfu who, according to Charlie Munger, Warren Buffett#8217;s right-hand man, is a combination of Thomas Edison and Jack Welch. The company is only 14 years old and is already bringing in $4 billion in sales./p pBYD is now the world#8217;s leading manufacturer of batteries (they supply the batteries for Apple). BYD is now moving into the manufacturing of plug-in cars. I think in view of the company#8217;s history and capabilities, that BYD will be successful and#8230;/p/blockquote

Yuan to Jump on the Golden Bandwagon?

Mogambo Guru — Thu, 28 May 2009 20:45:09 +0000

pMaybe the fact that central banks, banks and governments around the world are acting like monetary idiots explains why gold is shooting up in price; or maybe that it is going up in price explains why there is such a new interest in gold; or maybe it just explains why people are as disrespectful of the dollar, as am I./p pAnd there are lots of them, as I gather from Jim Willie at GoldenJackass.com, who is warning us to keep an eye on the Chinese, and that we should expect them to move “toward creation of the Chinese yuan as a global reserve currency,” which is certainly interesting from a geo-political perspective, but which becomes Very, Very Interesting (VVI) when he#8230;/p

Invest in Brazil Now!

Contrarian Profits — Thu, 28 May 2009 18:05:13 +0000

pThe Brazilian stock market is on fire right now and they are immune to a lot of the ills that America is suffering from, like exposure to toxic assets. Make sure you put a small portion of your portfolio into emerging markets like Brazil./p pMy article for a href="http://www.investorsdailyedge.com" class="alinks_links"Investor’s Daily Edge/a on 04/09/09 recommended the a href="http://www.investorsdailyedge.com/best-ways-to-invest-in-the-brics.html" target="_blank"iShares MSCI Brazil Index/a (strongEWZ/strong). This Exchange Traded Fund holds a nice basket of Brazilian stocks and seeks to mirror the Brazilian stock market as measured by the MSCI Brazil index./p pIf you took my advice, you’d have seen a big short-term gain as the Brazilian ETF rose over 22% in less than two months. Our staff here at Investor’s Daily Edge strives to give you information that can help#8230;/p

Russian Rumors

Contrarian Profits — Thu, 28 May 2009 17:05:56 +0000

pDollar rallies on N. Korea warning#8230; Emerging Markets decouple#8230; A debt upgrade for New Zealand#8230; Swiss francs rise despite SNB warnings#8230; And Now#8230; Today#8217;s Pfennig!/p pWell#8230; The dollar came back with some vengeance yesterday pushing the Big Dog, euro, back well within the 1.38 handle, and all the other little dogs, other currencies, followed. There wasn#8217;t data to speak of yesterday to push the dollar higher, it was simply a case of fright, as safe haven flows went the dollar#8217;s way after the news of a N. Korea attack warning spread throughout the markets./p pFunny thing#8230; I get a daily email from a news source that gives the highlights at mid-day#8230; And yesterday, the email said, well, the email didn#8217;t really #8220;say#8221;#8230;/p

Will You Be Ready When They Push the Button

Andrew Snyder — Wed, 27 May 2009 20:47:59 +0000

pAs I have said countless times on these pages over the past several months, making money in the options market is all about being on the right side of volatility./p pEarlier today, I proved the notion to emTFN Strategic Trader/em investors as I alerted them to lock in profits of up to 90% on a recent position. You may have read about it./p pIf not, a href="http://tfnstrategictrader.com/welcome/" target="_blank"do it here/a./p pBut when it comes to volatility, nothing is as topsy-turvy as the political mess in Korea. Now that Russia is warning of a possible nuclear battle, the stakes are increasing by the minute. With every missile North Korea fires, the situation gets more and more critical./p pAs usual, the options market offers the best short-term opportunity to#8230;/p

Has The Next Investing Bubble Begun With This ETF?

ETF Daily News — Tue, 26 May 2009 21:24:58 +0000

Every month Merrill Lynch (or Bank of America Securities-Merrill Lynch for you scorekeepers) checks in with a bunch of big time money managers to take their bullish/bearish temperature. Collectively the 400 or so global managers in the May survey are pushing the buttons controlling portfolios worth nearly $1 trillion, so we’re not talking about a [...]

How To Find The Next China With ETF’s?

ETF Daily News — Tue, 26 May 2009 00:47:11 +0000

Lately, international investing, particularly emerging market investing, has been pretty poor. It’s hard to believe that, only two years ago, investors poured more than $16 billion into various emerging market mutual funds and exchange products. But then, the global slowdown came and growth, as well as stocks, have plummeted. While the recent market rallies have brought [...]

Increasing Dividends, Higher Total Return Mean Asian Equities Might Be Worth a Look

Eric Roseman — Wed, 20 May 2009 19:30:05 +0000

pTen years ago, Asian equities paid pitifully low dividends following the bull market in the late 1990s. But that’s all starting to change as many markets in the region now offer higher dividend payouts than the S#38;P 500 and many European equity markets…/p pAsia, unlike major Western markets, already suffered from an economic depression in 1997-1998 as country after country was sucked into a massive currency and debt crisis smashed into the region./p pAsia’s quick response to the crisis – mainly thanks to China – combined with easy credit financing from the West helped to lessen the severity and duration of the blow./p pCurrently, the FTSE Asia-Pacific Large-Cap Index (excluding Japan) yields 3.8% while the Tokyo Nikkei yields 2.7%. Both sectors yield more#8230;/p

Tapping Into Top Country ETFs

ETF Daily News — Tue, 19 May 2009 22:18:46 +0000

A quick glance at foreign stock ETFs will show you what’s happening around the globe. Since the beginning of the year, emerging market stocks (NYSEArca: EEM) are up 27.20%, making them the best performing segment within the global equity market. Certain regions of the world are doing better than others. European stocks (NYSEArca: VGK) are up 2.37%, [...]

China Performs a Kind of Financial Alchemy

Dan Denning — Tue, 19 May 2009 20:56:18 +0000

pWherever we#8217;re going, are we there yet? Nope! But we#8217;re getting there. That is, America is sleepwalking its way into poverty. China is performing a kind of financial alchemy. And Australia finds itself subject to American-style problems, but benefitting from China#8217;s Grand Economic Strategy./p pBut how about those powerful idealists on U.S. markets? Both the S#38;P 500 and the Dow were up nearly three percent. If you can believe it, they were led by financial stocks and retailers. Bank of America (NYSE:a href="http://www.google.com/finance?q=BAC"BAC/a) finished up 9.9% after Goldman Sachs (NYSE:a href="http://www.google.com/finance?q=GS"GS/a) put it on its #8220;conviction buy#8221; list. Home hardware retailer Lowes was up 8.1% after a survey of U.S. homebuilder confidence surged./p pBy the way, what the hell is a #8220;conviction buy#8221; list?#8230;/p