Stock Market News & Stocks to Watch from StraightStocks » Switzerland

Pashminadepot.com, Inc. Changes Name to SwissINSO Holding Inc. (SWHN.OB)

QualityStocks — Mon, 23 Nov 2009 14:23:52 +0000

SwissINSO Holding Inc. (SWHN.OB), formerly PASH.OB, recently announced the company’s reincorporation in Delaware on October 28, 2009, and new name change that reflects the previously disclosed acquisition of SwissINSO SA. This acquisition was completed on October 19, 2009. Effective immediately, SwissINSO is trading under the ticker symbol SWHN and CUSIP number 87101R105. Formed in 2006 [...]

Producer Price Index Tame – Analyst Blog

Dirk Van Dijk — Tue, 17 Nov 2009 15:44:31 +0000

In September, the Producer Price Index rose by 0.3%. While this is an acceleration from the 0.6% decline in September, it is well below consensus expectations of a 0.5% increase.

All of the price pressures were coming from food and energy. If they are stripped out to get the Core Producer Price Index, prices fell by 0.6% for the month -- a much faster decline than the 0.1% decline last month, and even farther below the consensus expectations of a 0.1% increase for the month. Both food and energy rose by 1.6% at the finished level in September.

For energy, though, it was just a partial reversal of the 2.4% decline in September. In September, finished food prices fell only 0.1%. On a year-over-year basis, the total Producer Price Index is down 1.9%. However, last month the year-over-year decline was 4.8%. Thus on a year-over-year basis, the deflationary pressures are abating -- but just think about where we were a year ago!

The finished goods producer price index is the one that gets all the headlines. The core producer price index at the finished level also gets a fair amount of attention. However, the Bureau of Labor Statistics also provides data on what is happening further up the food chain, with data on intermediate and crude goods. To keep the three levels straight in your mind, think Wheat (crude), Flour (intermediate) and Bread (finished).

At those levels, there is some evidence of minor inflationary pressures, but again it is all driven by food and energy costs. At the intermediate level, prices rose 0.3% following a 0.2% increase in September. On a year-over-year basis, prices are down 7.5% at the intermediate level. The huge price declines of a year ago are rolling off.

In September, the year-over-year decline in the intermediate producer price index was 11.7%. Intermediate food prices were down 0.2%, following a 0.5% decline in September. Energy prices rose by 2.3% at the intermediate level -- more than reversing a 2.1% decline in September. Core prices at the intermediate level dropped by 0.2%, following a 0.9% increase in September. Keep in mind price swings tend to be more extreme at the intermediate level than they are at the finished goods level.

Far more extreme, though, are the swings in the crude level producer price index. After all, there is another name for crude goods -- commodities. Overall crude goods rose by 5.4% in October, more than making up for the 2.1% decline in September. Over the last year, prices for crude goods have dropped by 14.1%.

The bulk of that decline, however, came last year as the price of all commodities absolutely collapsed. In October of last year, the crude goods index plunged 16.1% and it was followed by a further 13.1% decline in November. Those will roll off soon, so the year-over-year numbers are going to show much smaller declines. Core crude prices rose by 0.5% in October, on top of a 0.5% rise in September. Crude energy prices rose by 8.3% -- more than offsetting a 5.4% decline in September. Similarly, crude food prices were up 5.2% for the month after having fallen by 1.9% in September.

This report shows that aside from food, and especially energy, there is no real inflation pressure in the economic system. Even looking far up the production chain, price pressures for core goods are very moderate. Thus the Fed should continue to hold down interest rates and be as accommodative as possible. After all, the Fed has two mandates -- price stability and full employment.

With core producer prices falling for two months in a row, and in four of the last six months, price stability would argue for MORE inflation, since we are facing deflation. Yes, the deflationary pressures are less than a year old, but year-over-year declines -- even throwing in food and energy prices of 1.9% -- are a far cry from Weimar Germany, or even the U.S. experience of the 1970’s.

The enemy right now is unemployment, not inflation. It also means that people should just shut the heck up about the decline of the dollar and stop treating it like it's some type of disaster. Yeah, it is sort of bad that a ski trip vacation to Davos, Switzerland will cost a lot more, but hey, maybe it will cause some folks to decide to ski Aspen, instead. Perhaps a few Europeans or Japanese will decide to come vacation in the U.S. since with the low dollar, vacations here are very cheap for them. That would actually create a few jobs in restaurants and hotels here.

More importantly, perhaps companies will decide to buy products made by General Electric (GE) instead of the competing products made by Siemens (SI). We might just start to shrink the yawning trade deficit that is an absolute cancer on the economy.

Talk of the Fed tightening is probably premature by at least a year. Yes, a weaker dollar will mean higher prices for internationally traded goods, most importantly for oil. That, however, would help stimulate more drilling activity, greatly helping the bottom lines for companies like Pride International (PDE) and making the existing reserves of companies like Anadarko (APC) much more valuable. It might just help keep demand for oil down, and accelerate the shift to alternative energy sources, such as wind and solar.

Don’t overlook natural gas as a potential alternative energy source, since we have vast supplies of it here in North America. That would be good news for firms like EnCana (ECA). Yeah, nobody really wants to pay more at the pump, but with other price pressures being kept well at bay, we can afford it -- especially if it leads to more jobs.

Look for the gap between headline and core producer prices to continue to widen, but overall, price pressures are very well contained. This gives the Fed free reign to keep interest rates at extraordinarily low levels for a very extended period of time. And not doing so would be extremely irresponsible.
Read the full analyst report on "GE"
Read the full analyst report on "SI"
Read the full analyst report on "PDE"
Read the full analyst report on "APC"
Read the full analyst report on "ECA"
Zacks Investment Research

NeurogesX Wins Big Approval – Analyst Blog

Zacks Market Commentaries — Tue, 17 Nov 2009 13:30:22 +0000

FDA Approves NeurogesX's Qutenza

After the market closed on November 16, 2009, NeurogesX (NGSX) announced that the U.S. FDA had approved Qutenza (capsaicin patch) for the management of neuropathic pain due to postherpetic neuralgia (PHN). We expect management to spend the next several months preparing for the launch by facilitating reimbursement procedure, establishing distribution channels, hiring and training the specialty sales force, and conducting the manufacturing for commercial supply.

Key to our bullish sales forecast for the drug will be establishing a permanent reimbursement code for both the product and application, as Qutenza requires administration by a physician or healthcare professional.

Qutenza is a cutaneous (skin) patch designed to treat peripheral neuropathic pain conditions. The Qutenza patch provides a pure high concentration (8%) of a synthetic capsaicin, known as trans-capsaicin, directly to the site of pain via a rapid-delivery cutaneous delivery system designed to provide three months of relief with minimal potential for side effects, abuse, or drug-drug interactions.

Qutenza has been studied in roughly 2,500 patients during its clinical program. Clinical studies have shown that PHN pain can be reduced for up to 12 weeks following a single one hour treatment. In the phase III PHN trial, patients administered Qutenza saw an average 30% to 32% reduction in pain vs. 20% to 24% for the control. Additionally, a significant number of patients on Qutenza demonstrated greater than a 30% reduction in pain over the course of treatment.

We believe management’s goal in the U.S. is to promote the product through an in-house specialty sales force -- eventually that may grow to the size of 80 to 100 representatives. The company has spent the last few months expanding the senior management team to bring in directors of marketing, commercial operations, sales and business development.

Management also recently conducted a qualitative and quantitative marketing study in preparation of approval. As of now, our financial model assumes a launch during the first half of 2010 with a small specialized sales force of around 20 to 25 representatives. This group will target the top quartile or so of the 5,000 pain centers and 10,000 neurologists that are high-prescribers for PHN. When progress is made here, management will probably look to expand through expansion of the force or signing a co-promotion agreement.

Outside the U.S., NeurogesX has partnered Qutenza with Japanese large-cap pharmaceutical company Astellas. NeurogesX received approval for Qutenza in the European Union in May 2009. The deal with Astellas includes all 27 EU member states, plus Iceland, Norway, Liechtenstein and Switzerland, along with the Middle East and Africa. Astellas plans to be ready to launch the product during the first half of 2010, and will pay NeurogesX a scaling mid-teen to mid-twenty percent royalty on sales.

We continue to be positive on NeurogesX. We are maintaining our Outperform rating and expect the share to trade upwards towards are $12 target over the near-term.
Read the full analyst report on "NGSX"
Zacks Investment Research

Zacks Analyst Blog Highlights: Apple Inc., Microsoft Corp, Quality Systems Inc., Allscripts-Misys Healthcare Solutions, Inc. and Cerner Corp. – Press Releases

Zacks Market Commentaries — Mon, 16 Nov 2009 13:45:26 +0000

For Immediate Release

Chicago, IL – November 16, 2009 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Apple Inc. (AAPL), Microsoft Corp (MSFT), Quality Systems Inc. (QSII), Allscripts-Misys Healthcare Solutions, Inc. (MDRX) and Cerner Corp. (CERN).

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513

Here are highlights from Friday’s Analyst Blog:

Apple Opens New Store in New York

To ensure a high-quality buying experience for its products, in which service and education are emphasized, the company has expanded and improved its distribution capabilities by opening its own retail stores in the U.S. and internationally.

The company operates a network of 280 retail stores in 10 countries across the world, including the U.S., U.K., Italy, Australia, Canada, Japan, China, Switzerland, Germany and France to drive the demand for its other products. Further, Apple is soon to open two new stores in Shanghai as well as London and Paris.

The company further plans to open 40 to 50 new larger retail stores next year, about half of which are expected to be outside the U.S. Apple had earlier estimated that it would open 25 to 50 new stores.

Retail sales increased 4.0% to $6.57 billion (averaging $26.0 million per store annually). Store traffic grew to around 170 million in fiscal 2009. The company has extended its footprint in international retail markets. Growing its presence in the international retail market, Apple opened its first store in Sydney and Beijing and opened stores in Switzerland, France and Germany during the calendar year 2008.

Apple's business strategy leverages its ability, through the design and development of its own operating system, hardware and many software applications and technologies, to provide its customers around the world with compelling new products and solutions, superior ease-of-use, seamless integration and innovative industrial design.

To attract customers during the holiday season, the company plans to offer gift-wrapping of any iPod or portable Mac for just $5. It will also allow customers to set aside a gift and pick it up at their local Apple store for free from Dec. 15 to Christmas Eve.

Apple’s stores hosted 42.7 million visitors during the last quarter, an increase of 7% from the year-ago period. The stores posted revenue of $1.87 billion ($7.6 million per store) in the quarter, the highest level ever and up 15% from the year-ago period.

Last month, Microsoft Corp (MSFT) announced the opening of its own first retail store in Arizona. But we do not expect Microsoft to catch up anytime.

Quality Systems Barely Beats

Quality Systems Inc. (QSII) reported fiscal second-quarter earnings of 41 cents, beating the Zacks Consensus Estimate by a penny and the year-ago earnings by 4 cents.

Total revenues for the quarter increased 21.5% to $71.69 million from $58.98 million. The company’s NextGen Healthcare Information Systems division posted revenue of $67.4 million for the reported quarter, representing a 23% increase from the previous year.

Category-wise, System sales, including software, hardware and supplies, increased 5.9% to $26.24 million from $24.78 million. Revenues from maintenance, electronic data interchange (EDI), revenue cycle management (RCM) and other services grew 32.9% to $45.46 million from $34.19 million in the year-ago period.

The total cost of system sales, including software, hardware and supplies increased 16.8% to $7 million. Total cost of maintenance, EDI, RCM and other services for the quarter were $21.27 million as against $15.2 million in the year-ago quarter, up 39.9%. Consequently, total cost of revenues for the quarter increased 33.4% to $28.3 million. The company reported a gross profit of $43.4 million for the quarter opposed to $37.8 million in the year-ago period, up 14.8%.

Research & development spend for the quarter increased 30% to $4.34 million for the quarter. Selling, general and administrative expenses for the reported quarter increased 11.7% to $20.4 million.

Quality Systems exited the quarter with cash and cash equivalents of $75.4 million opposed to cash and cash equivalents of $70.2 million at the end of fiscal 2009.

Quality Systems, headquartered in Irvine, California, develops and markets healthcare information systems that automate certain aspects of medical and dental practices, networks of practices such as physician hospital organizations and management service organizations, ambulatory care centers, community health centers, and medical and dental schools. The company competes with players like Allscripts-Misys Healthcare Solutions, Inc. (MDRX) and Cerner Corp. (CERN).

Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5515.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: http://at.zacks.com/?id=5517

About Zacks

Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978 by Leonard Zacks. As a PhD in mathematics Len knew he could find patterns in stock market data that would lead to superior investment results. Amongst his many accomplishments was the formation of his proprietary stock picking system; the Zacks Rank, which continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros at http://at.zacks.com/?id=5518.

Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts

Disclaimer: Past performance does not guarantee future results. Investors should always research companies and securities before making any investments. Nothing herein should be construed as an offer or solicitation to buy or sell any security.

Contact:
Mark Vickery
Web Content Editor
312-265-9380
Visit: www.zacks.com

Zacks Investment Research

Apple Opens New Store in New York – Analyst Blog

Zacks Market Commentaries — Fri, 13 Nov 2009 22:45:25 +0000

Apple Inc. (AAPL) will open its newest retail store with an 8,500 square feet retail space in New York tomorrow. The store will help Apple deliver more Macs, iPods and iPhones, taking advantage of the coming holiday season. The new store is the fourth in Manhattan and fifteenth in New York.

To ensure a high-quality buying experience for its products, in which service and education are emphasized, the company has expanded and improved its distribution capabilities by opening its own retail stores in the U.S. and internationally.

The company operates a network of 280 retail stores in 10 countries across the world, including the U.S., U.K., Italy, Australia, Canada, Japan, China, Switzerland, Germany and France to drive the demand for its other products. Further, Apple is soon to open two new stores in Shanghai as well as London and Paris.

The company further plans to open 40 to 50 new larger retail stores next year, about half of which are expected to be outside the U.S. Apple had earlier estimated that it would open 25 to 50 new stores.

Retail sales increased 4.0% to $6.57 billion (averaging $26.0 million per store annually). Store traffic grew to around 170 million in fiscal 2009. The company has extended its footprint in international retail markets. Growing its presence in the international retail market, Apple opened its first store in Sydney and Beijing and opened stores in Switzerland, France and Germany during the calendar year 2008.

Apple's business strategy leverages its ability, through the design and development of its own operating system, hardware and many software applications and technologies, to provide its customers around the world with compelling new products and solutions, superior ease-of-use, seamless integration and innovative industrial design.

To attract customers during the holiday season, the company plans to offer gift-wrapping of any iPod or portable Mac for just $5. It will also allow customers to set aside a gift and pick it up at their local Apple store for free from Dec. 15 to Christmas Eve.

Apple’s stores hosted 42.7 million visitors during the last quarter, an increase of 7% from the year-ago period. The stores posted revenue of $1.87 billion ($7.6 million per store) in the quarter, the highest level ever and up 15% from the year-ago period.

Last month, Microsoft Corp (MSFT) announced the opening of its own first retail store in Arizona. But we do not expect Microsoft to catch up anytime.

We maintain our Outperform rating on Apple, partly because of the remarkable success of the Apple Store.
Read the full analyst report on "AAPL"
Read the full analyst report on "MSFT"
Zacks Investment Research

Gilead Awaits Committee Outcome – Analyst Blog

Zacks Market Commentaries — Fri, 13 Nov 2009 06:30:09 +0000

Gilead Sciences, Inc (GILD) is awaiting the outcome of the Anti-Infective Drugs Advisory Committee of the US Food and Drug Administration (FDA) scheduled on December 10, 2009. The committee will review Gilead ’s aztreonam for inhalation solution, an investigational product for the treatment of chronic pulmonary infections due to Pseudomonas aeruginosa (P. aeruginosa) in patients with cystic fibrosis (CF). Earlier, in September 2008, the drug was denied approval by the FDA, which then asked Gilead to resubmit the application with more data.

In September 2009, the drug received conditional marketing approval in Canada and Europe under the trade name Cayston (aztreonam lysine 75 mg powder and solvent for nebuliser solution). Gilead plans to make the product available in Germany and the UK in early 2010. Aztreonam formulated with lysine is a proprietary formulation of aztreonam developed specifically for inhalation, which has orphan drug status in the US and Europe . Applications for marketing approval of Cayston are pending in Australia , Switzerland and Turkey .

CF is a chronic, debilitating genetic disease that affects the respiratory and digestive systems of approximately 70,000 people worldwide, including 35,000 people in the European Union. Cayston was granted conditional marketing authorization to address the unmet medical need of the CF patients. A decision regarding full marketing authorization will be based on the completion of the ongoing phase III study examining the efficacy and safety of Cayston compared to Novartis’ (NVS) tobramycin inhalation solution (TOBI) in CF patients with pulmonary P. aeruginosa.

During the third quarter conference call, Gilead stated that it expects to complete enrollment by the year end and make the data available towards the middle of next year. We believe positive data from this study will help it to receive approval from the regulatory authorities in both US and Europe . We have a Neutral recommendation on the stock.
Read the full analyst report on "GILD"
Read the full analyst report on "NVS"
Zacks Investment Research

Zacks Analyst Blog Highlights: Southern Copper Corporation, Logitech International, Cisco Systems Inc., Microsoft Corp. and Koninklijke Philips Electronics NV – Press Releases

Zacks Market Commentaries — Thu, 12 Nov 2009 12:55:28 +0000

For Immediate Release

Chicago, IL – November 12, 2009 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Southern Copper Corporation (PCU), Logitech International (LOGI), Cisco Systems Inc. (CSCO), Microsoft Corp. (MSFT) and Koninklijke Philips Electronics NV (PHG).

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513

Here are highlights from Wednesday’s Analyst Blog:

Southern Copper’s Earnings Jump

Southern Copper Corporation (PCU), one of the leading copper producers in the world, posted net earnings of 37 cents in the third quarter of 2009, better than the Zacks Consensus Estimate of 31 cents. Earnings jumped 78.6% from 21 cents sequentially while it declined 22.3% from 47 cents year on year. The company attributed lower costs for driving earnings. Operating costs decreased 15.8% year over year due to higher productivity.

Copper production in the quarter improved 1.3% to 120,240 tons from 118,657 tons, driven by higher production at the La Caridad mine in Mexico and the Peruvian mines, on the back of better ore grades. Molybdenum production increased 14.3% to 5,191 tons, compared to 4,541 tons in the year-ago quarter. Higher ore grades and recoveries lead to an increase of 631 tons at La Caridad and 734 tons production at the Cuajone mine in Peru. These increases were partially offset by 715 tons of lower production at the Toquepala mine in Peru due to lower ore grades.

Logitech Acquires LifeSize

Logitech International (LOGI) announced that it has agreed to acquire privately held LifeSize Communications of Austin, Texas for $405 million in cash. LifeSize is a global leader in high definition (HD) video communication solutions, with more than 9,000 video conferencing customers across 80 countries in large enterprises, small-to-medium businesses (SMBs) and public healthcare, education and government organizations.

The acquisition will enable Logitech to extend its leadership in video communication beyond the desktop.

Logitech and LifeSize plan to pursue existing and new relationships with unified communications, collaboration and VoIP industry partners and competitors to drive the development of an open eco-system for interoperable video communication.

LifeSize expects approximately $90 million in revenues in CY 2009, with CY 2010 revenues expected to grow between 40% and 60%. Logitech expects the acquisition to be neutral to slightly positive to its operating income (excluding acquisition-related charges) in FY 2011, ending March 31, 2011, and positive thereafter.

For a long time, videoconferencing was limited to big businesses that could afford to build expensive systems in their conference rooms. But videoconferencing has become more accessible because Internet connections are commonplace, video has become more efficient and the price has dropped for high-definition cameras and displays.

Now, many companies are trying to reach small businesses and individuals that previously used low-quality webcams on PCs. In the previous month, Cisco Systems Inc. (CSCO) announced its intension to buy Tandberg, a Norwegian video communications company, for $3 billion. Tandberg makes smaller and less expensive videoconferencing tools that can be fitted on desks.

Logitech engages in design, manufacture, and marketing of personal peripherals for personal computers and other digital platforms in Europe, the Middle East, Africa, the Americas, and the Asia Pacific. The company was founded in 1981 and is based in Apples, Switzerland. Major competitors include Microsoft Corp. (MSFT) and Koninklijke Philips Electronics NV (PHG).

Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5515.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: http://at.zacks.com/?id=5517

About Zacks

Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts

Contact:
Mark Vickery
Web Content Editor
312-265-9380
Visit: www.zacks.com

Zacks Investment Research

Logitech Acquires LifeSize – Analyst Blog

Zacks Market Commentaries — Wed, 11 Nov 2009 18:45:55 +0000

We currently have a Neutral recommendation on LOGI.

Read the full analyst report on "LOGI"
Read the full analyst report on "CSCO"
Read the full analyst report on "MSFT"
Read the full analyst report on "PHG"
Zacks Investment Research

Pipeline Pact

Robert Amsterdam — Tue, 10 Nov 2009 15:12:28 +0000

This in from the Wall Street Journal on the somewhat disturbing, political dimensions of Russia's Nord Stream pipeline. Approved just last week by Finland and Sweden after ecological concerns were overcome, the project is now ready to get off the...

Blogging – taking a break while visiting Europe

Prieur du Plessis — Mon, 09 Nov 2009 05:30:45 +0000

I am traveling in Europe - Switzerland and Slovenia - at the moment, exploring business opportunities and gathering a feel for the economic climate in Western and Central Europe. The downside is that blog posting will be very slow for most of the time while I am on the road. The normal blogging service will be resumed on my return to Cape Town on October 16.

DrStockPick.com Stock Report! 11/05/09, CVG, CVAT, COIN, SYX, SIGA, RTN

Dr. Stock Pick — Thu, 05 Nov 2009 15:30:52 +0000

Dr Stock Pick HOT News & Alerts! _______________________________________ FREE Daily Stock Alerts From DrStockPick.com _______________________________________ Thursday November 5, 2009 DrStockPick.com Stock Report! ************************************************************** Cavitation Technologies, Inc. (OTC Bulletin Board: CVAT) announced recently that it has signed Miura Engineering Co., Ltd. Tokyo, Japan (www.miura21.co.jp) as its new agent to serve markets in Japan for CTI’s Nano-Cavitation Process Systems. Miura is [...]

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 [...]

Initiating Oxygen Bio at Outperform – Analyst Blog

Zacks Market Commentaries — Mon, 26 Oct 2009 16:48:34 +0000

We are initiating coverage of Oxygen Biotherapeutics, Inc. (OXBO) with an ‘Outperform’ rating. Despite what has been a tumultuous past for the company and a abysmal fate for competitors attempting to develop similar products, the potential upside that Oxycyte offers is too significant to ignore.

Does Oxycyte do what management says it does? (Key Efficacy Question)

In theory, Oxycyte has the potential to be a wonder drug -- a sort of WD-40 of medicine. Preclinical data suggests that Oxycyte has astounding potential for the treatment of traumatic brain injury (TBI), decompression sickness, carbon monoxide poisoning, sickle cell crisis, organ preservation and as a neuroprotectant in patients with myocardial infarction or stroke.

The effects in TBI were clearly evident in the phase I program conducted by Oxygen Bio in 2006. Initial phase II data from STOP-TBI will become available in 2010. However, data from small animal studies show that intravenous injection of Oxycyte following lateral fluid percussion injury acts as a neuroprotectant in preserving neuronal cell counts and improving brain tissue oxygen consumption. Other small animal studies suggest that Oxycyte can improve circulating oxygen levels and cerebral blood flow following an induced ischemic stroke.

These results suggest that Oxycyte treatment can greatly improved the cognitive recovery and prevent cell damage in patients with brain injury, spinal cord injury or ischemia due to MI or stroke. The high gas solubility characteristics of Oxycyte suggest significant potential in treating decompression sickness, carbon monoxide poisoning and surgical iatrogenic air embolism.

For the topical Oxycyte applications, Dermacyte should begin recording sales later this year. The product will be marketed over-the-counter (OTC) as an oxygen-rich cosmetic gel that promotes healthy looking skin.

Is it safe? (Key Safety Question)

Oxycyte is biochemically and metabolically inert. It is thermal stable, and produces no immune response or antibody formation. There were no signs of thrombocytopenia in the preclinical or phase I program. Plus, perfluorocarbons are clearly safer than hemoglobin-based oxygen carriers when it comes to risk of vasoconstriction.

For the phase II STOP-TBI program, management has established a "platelet and thrombocytopenia" task force to assess the coming data along with an independent data safety monitoring board (DSMB). If management can alleviate the FDA’s concerns on thrombocytopenia, U.S. registration trials shouldn’t be too far off after STOP-TBI from Switzerland and Israel.

Does Oxygen Bio have the cash to see this through? (Key Financial Question)

Oxygen Bio exited the fiscal first quarter 2010 (July 31, 2009) with $2.5 million in cash and investments. Burn for the first quarter was $1.5 million. In June 2009, management entered into a securities purchase transaction with Vatea Fund for a potential total of $20 million. The first tranche was purchased in July 2009 at $5 million. Management used $2.8 million to re-purchase existing warrants outstanding.

The first milestone under the Vatea Fund transaction was achieved in September 2009 with the initiation of the phase IIb STOP-TBI program. This is worth $6 million, and is exercisable in early December 2009.

Cash balance at the end of the fiscal Q2 2010 (October 31, 2009) will be less than $1 million. However, the accounts receivable will be roughly $6 million. Therefore, we estimate that Oxygen Bio will exit the calendar year 2009 with north of $5 million cash on hand. This should be enough to fund operations into the fall of 2010.

Assuming management meets the milestones agreed upon with Vatea, the company has access to an additional $9 million in cash.

Conclusion

Risks are still high and the company is still a few years away from sustained profitability. Normally we would not recommend investors acquire shares in a company based on preclinical data alone, but Oxycyte (and perfluorocarbons in general) is a molecule well-studied over the past decade. Our answers to the above three questions give us enough confidence that we can recommend investors take a look at the stock.

Does it work and is it safe? So far, the data looks very intriguing. Is the company financially sound? We outlined above the current financial situation -- cash enough to make it into the calendar third quarter 2010. This is enough cash to fund STOP-TBI to interim data. Plus, Vatea can still contribute an additional $9 million in milestones, and sales of Dermacyte will help reduce cash burn in calendar 2010 and 2011.

With positive interim efficacy data from STOP-TBI in 2010, we have no doubt that the Army (for TBI) and the Navy (for DCS) will begin purchase of Oxycyte for deployment in the field. With positive safety data, we have no doubt that management will be able to secure additional developmental partnerships for the next wave of indications including carbon monoxide poisoning, sickle cell crisis, organ preservation and even cardiovascular indications. The financial position improves as the clinical data on Oxycyte begins to roll in.

The stock sitting at only 46 cents per share creates a very intriguing risk/reward profile. The planned 1-for-15 reverse stock split and move to a major stock exchange in the next two months creates an opportunity.

Oxygen Bio is making an impressive move from OTC back to a major exchange. We have preformed a detailed NPV analysis for each potential indication for both injectable and topical Oxycyte using an aggressive 30% discount rate in our calculations, and arrived at a fair market value of $301 million. Based on the current weighted-average shares outstanding, we arrive at a price target of $1.02 per share.

Additional information can be found in our full initiation report on our website.
Read the full analyst report on "OXBO"
Zacks Investment Research

Time for New Stock Market Leadership?

Frank Holmes — Mon, 26 Oct 2009 05:00:00 +0000

This analysis is from John Derrick, U.S. Global Investors Director of Research. The market has rallied dramatically since the March 9 low, with the biggest beneficiary of this rally being low-quality companies. This intuitively makes sense, given that companies with the most troubled outlooks are the ones most likely to have a strong recovery when the dire outcomes predicted at the bottom of the crisis failed to transpire. Quality may have different meanings to different investors, but in a recent research piece, Citigroup ranked performance based on multiple definitions of quality. Samp;P earnings quality ranking, debt-to-capitalization ratio and return on equity were used as proxies for quality. The research universe was the small-cap Russell 2000 Index, but I believe broader market conclusions can be drawn as well. Based on Samp;P earnings quality rankings, companies with C or D (the two lowest categories) ratings returned about 55 percent over the past six months, while the highest-rated stocks returned about 11 percent. As a whole, the Russell 2000 universe returned 30 percent over that time period. This trend is also broadly true for the other measures of quality. Generally speaking, companies with higher debt burdens outperformed companies carrying low debt, and companies with negative return on equity outperformed the broader market as well as the companies with the highest return on equity. Morgan Stanley also recently released a research report that looked at low-priced stocks as a proxy for low-quality and found that Samp;P 500 stocks trading below $5 dramatically outperformed. The same analysis was conducted on the MSCI Europe Index with very similar results, indicating a broad-based global phenomenon. Morgan Stanley highlighted that the recovery so far has been driven by multiple expansion ndash; the valuation that investors are willing to pay has increased, but that has not been supported by an increase in earnings in the current period. But we are now potentially at an inflection point at which the junk rally has more or less run its course and the market is beginning to focus on earnings growth. The business cycle plays a significant role in market valuations in the sense that the market anticipates a recovery and pays up for the anticipated earnings stream. Once the recovery takes hold, however, investors focus on actual earnings power as the primary driver of valuations. One persuasive indicator that the recovery has indeed taken hold can be seen in the ISM Manufacturing Index, which moved above 50 about six weeks ago, indicating that the economy is expanding. What has worked so far in this stock market recovery will not likely carry us into 2010 and beyond, so the time could be right to reposition for the next leg of the recovery. All opinions expressed and data provided are subject to change without notice. Some of these opinions may not be appropriate to every investor. The Russell 2000 Index is a U.S. equity index measuring the performance of the 2,000 smallest companies in the Russell 3000. The Russell 3000 Index consists of the 3,000 largest U.S. companies as determined by total market capitalization. The MSCI Europe Index is a free float-adjusted market capitalization index that is designed to measure developed market equity performance in Europe. As of September 2002, the MSCI Europe Index consisted of the following 16 developed market country indices: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, the Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, and the United Kingdom. The Samp;P 500 Stock Index is a widely recognized capitalization-weighted index of 500 common stock prices in U.S. companies. The ISM manufacturing composite index is a diffusion index calculated from five of the eight sub-components of a monthly survey of purchasing managers at roughly 300 manufacturing firms from 21 industries in all 50 states. #09-734

Philip Morris Tops, Ups Guidance – Analyst Blog

Zacks Market Commentaries — Thu, 22 Oct 2009 22:06:29 +0000

Earlier today, cigarette manufacturer and marketer Philip Morris International Inc. (PM) reported better-than-expected third-quarter results, benefiting from price increases in some markets. Earnings per share came in at 93 cents, 3 cents above the Zacks Consensus Estimate.

On a year-over-year basis, Philip Morris’ earnings per share was flat (excluding a tax benefit of 8 cents in 2008), while net revenues declined 4.6% to $16.6 billion, attributable to unfavorable currency translations and weak results in the European Union (EU), Eastern Europe and Middle East & Africa (EEMA) markets.

Revenue, Volumes & Margins

On an organic basis (excluding currency and acquisitions), revenues increased 4.1% driven by favorable pricing. Cigarette volume was down almost 3% year-over-year to 219.3 billion units, mainly because of declines in EU, EEMA and Asia. The first two regions were adversely affected by the economic crisis (especially in Spain and Ukraine) and unfavorable comparisons due to a strong third quarter in 2008, while Asian volumes suffered from unfavorable trade inventory movements in Pakistan. This was partly offset by strength in Latin America & Canada, buoyed by the acquisition of Rothmans Inc.

Organic cigarette shipment volume declined 4.0%. Marlboro volumes declined 4.3% due to the cigarette market contracting in the EU and EEMA, primarily from the effects of the economic crisis in Spain and the weakening of the premium segment in Russia and Ukraine. Nevertheless, Philip Morris gained market share in Algeria, Argentina, Belgium, Brazil, Bulgaria, Canada, the Dominican Republic, Egypt, Hungary, Korea, Mexico, Pakistan, the Philippines, Portugal, Russia, Slovakia, Switzerland, Turkey and the Ukraine.

The gross margin remained flat at 25.8%, while the operating margin expanded 62 basis points to 17.5%. Interest expense increased 220% from $69 million to $221 million due to a higher average debt level.

Dividends & Share Buyback

Recently, Philip Morris announced a 7.4% increase in its quarterly dividend to 58 cents per share ($2.32 per share annualized). During the quarter, the company repurchased 31.5 million shares for $1.5 billion.

Guidance

Concurrent with the earnings release, management raised guidance for 2009. Annual earnings are expected to be in the range of $3.20 to $3.25 per diluted share versus previous guidance of $3.10 to $3.20. Guidance includes an unfavorable currency impact of 52 cents per share.

Excluding currency, diluted earnings per share are expected to increase by approximately 12% to 14%, including a pre-tax charge of $135 million ($93 million after-tax or $0.04 per share) related to the Colombian Investment and Cooperation Agreement and excluding the impact of any potential future acquisitions, asset impairment and exit costs, and any other unusual events.
Read the full analyst report on "PM"
Zacks Investment Research

Beacon Enterprise Solutions Group, Inc. (BEAC.OB) Continues Engagement with Fortune 100 Pharmaceutical Company

QualityStocks — Mon, 19 Oct 2009 18:20:03 +0000

Today, Beacon Enterprise Solutions Group, Inc., an emerging global leader of high performance Information Transport Systems (“ITS”) infrastructure solutions, announced that it has expanded its relationship with an existing Fortune 100 pharmaceutical client to provide ITS infrastructure documentation, design, installation and ongoing management services. Valued at approximately $27 million, the engagement will initially focus on [...]

Zacks Analyst Blog Highlights: Cognizant, UBS AG, Infosys Technologies Ltd, Repsol YPF S.A. and Eni S.p.A. – Press Releases

Zacks Market Commentaries — Mon, 19 Oct 2009 12:48:02 +0000

For Immediate Release

Chicago, IL – October 19, 2009 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Cognizant (CTSH), UBS AG (UBS), Infosys Technologies Ltd (INFY), Repsol YPF S.A. (REP) and Eni S.p.A. (E).

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=5513

Here are highlights from Friday’s AnalystBlog:

Cognizant Buys UBS ISC

Headquartered in Zurich and Basel, Switzerland, UBS AG is a global firm providing services to private, corporate and institutional clients. New Jersey-based Cognizant is a leading provider of consulting, technology and business process outsourcing (BPO) services.

The transaction is expected to close by the end of 2009. As part of the transaction, UBS and Cognizant have entered into a multi-year service agreement under which Cognizant will provide a range of business process outsourcing (BPO), knowledge process outsourcing (KPO), IT, and remote infrastructure management services to UBS divisions around the globe. Cognizant aims to help these divisions to reduce time-to-market, expand service delivery, and improve productivity, operational efficiency and quality.

UBS is a leader in wealth management, investment banking, asset management, research and remote IT infrastructure management. Management at Cognizant believes that this acquisition will help Cognizant strengthen its business and knowledge process capabilities, deepen its financial services domain knowledge, and improve its capabilities to provide integrated services across consulting, technology, and outsourcing.

Cognizant continues to outperform its peers and remains a leader in IT services. Compared to its competitors Tata Consultancy Services Ltd and Infosys Technologies Ltd (INFY), CTSH is setting a more robust tone going forward.

Repsol Confirms Gas in Venezuela

Following the test on recently found gas resource in the shallow waters of the Gulf of Venezuela, Repsol YPF S.A. (REP) confirmed reserves of between 5.6 trillion and 7.8 trillion cubic feet of gas. With an estimated area of 33 square kilometers, it is the country’s largest discovery.

Repsol (32.5% interest) partners with Italy's Eni S.p.A. (E – 32.5%) and Venezuela's state-owned oil company Petroleos de Venezuela SA (35%) for future production on this resource.

While Venezuela aims to increase natural gas output to overcome the current deficit, Repsol wants to boost oil and gas production through new discoveries off the coasts of Brazil and Venezuela after four years of declining output.

Want more from Zacks Equity Research? Subscribe to the free Profit from the Pros newsletter: http://at.zacks.com/?id=5515.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today: http://at.zacks.com/?id=5517

About Zacks

Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts

Contact:
Mark Vickery
Web Content Editor
312-265-9380
Visit: www.zacks.com

Zacks Investment Research

Cognizant Buys UBS ISC – Analyst Blog

Zacks Market Commentaries — Fri, 16 Oct 2009 21:20:46 +0000

Cognizant (CTSH) recently announced a definitive agreement to acquire UBS India Service Centre Private Limited for about $75 million. Based in India, UBS ISC is a captive service provider to UBS AG (UBS) and currently employs 2,000 associates.

Headquartered in Zurich and Basel, Switzerland, UBS AG is a global firm providing services to private, corporate and institutional clients. New Jersey-based Cognizant is a leading provider of consulting, technology and business process outsourcing (BPO) services.

The transaction is expected to close by the end of 2009. As part of the transaction, UBS and Cognizant have entered into a multi-year service agreement under which Cognizant will provide a range of business process outsourcing (BPO), knowledge process outsourcing (KPO), IT, and remote infrastructure management services to UBS divisions around the globe. Cognizant aims to help these divisions to reduce time-to-market, expand service delivery, and improve productivity, operational efficiency and quality.

UBS is a leader in wealth management, investment banking, asset management, research and remote IT infrastructure management. Management at Cognizant believes that this acquisition will help Cognizant strengthen its business and knowledge process capabilities, deepen its financial services domain knowledge, and improve its capabilities to provide integrated services across consulting, technology, and outsourcing.

Cognizant continues to outperform its peers and remains a leader in IT services. Compared to its competitors Tata Consultancy Services Ltd and Infosys Technologies Ltd (INFY), CTSH is setting a more robust tone going forward.

The company earlier acquired Pepperweed Advisors, the IT consulting services division of Pepperweed Consulting in a move to strengthen its IT Infrastructure Services (IT IS) practice in two areas -- IT Service Management (ITSM) and IT Asset Management (ITAM). Management had earlier stated that the demand environment remains positive and the increase in demand for the company’s services continued into the third quarter as well after a strong second quarter.

The company remains well diversified among verticals such as financial services, health care and life sciences, retail, manufacturing and logistics. This diversification has helped the company maintain its top line even in this tough economic climate.
Read the full analyst report on "CTSH"
Read the full analyst report on "UBS"
Read the full analyst report on "INFY"
Zacks Investment Research

Equinix Works on Enhanced Solution – Analyst Blog

Zacks Market Commentaries — Mon, 12 Oct 2009 15:30:00 +0000

Through a recent press release, Equinix Inc. (EQIX) announced that the company, in collaboration with Alcatel-Lucent (ALU), is developing an enhanced solution for the exchange of data traffic between carriers providing Ethernet services.

Equinix will use Alcatel-Lucent’s service router to equip the Equinix Carrier Ethernet Exchange platform in order to deliver high performance global Ethernet services. Equinix is looking to apply its expertise in interconnection for resolving the challenges faced by different carriers planning to enhance their Ethernet services.

Ethernet connection generally provides quality, cost advantage and speed, but is generally provided within a geographical region. The Equinix Carrier Ethernet Exchange platform is different in the sense that it will focus on developing a multi-provider carrier Ethernet interconnection that meets Metro Ethernet Forum standards.

This solution will be delivered through Equinix International Business Exchange (IBX) data centers located across the globe. Additionally, the company is expanding its data centers across geographies. Recently, Equinix unveiled its plan to set up a 4,500 square meter or 48,400 square foot data center in Geneva , Switzerland.

The company is in the process of expanding its global data center network to meet the growing demand for data center services. This second data center in Geneva falls within the company’s $1.4 billion expansion plan to be executed within the 2007 – 2010 time period, under which the company expects to expand its operations in 15 out of 18 markets, where the company operates.

We believe that the setting up of a carrier-neutral Ethernet services platform is in-line with the company’s data center expansion plans, as these services will be delivered through the company’s data centers. Alcatel-Lucent is considered to be a leader in Ethernet technology, while Equinix has around 10 years experience in developing network interconnections, so we believe that this joint venture is a good strategic move by Equinix and will provide a new dimension to the Ethernet technology.
Read the full analyst report on "EQIX"
Read the full analyst report on "ALU"
Zacks Investment Research

UBS Boosts Energy Lending Biz – Analyst Blog

Zacks Market Commentaries — Thu, 08 Oct 2009 16:45:53 +0000

As part of strengthening its Global Energy banking practice UBS Investment Bank, a subsidiary of UBS AG (UBS), is hiring 18 Investment bankers who will focus on energy lending. Based in Dallas , this new team will have Darrell Holley serving as Managing Director and Global Head of energy lending.

The new team has significant expertise in energy lending and will complement UBS’s existing Energy Banking team in Houston and New York .

Holley will report to Stephen Trauber, Global Head of Energy banking at UBS. Previously, Holley was with Fortis Bank in Dallas , where he was Global Head of Oil and Gas banking.

Over the last month, UBS added more than a dozen of Managing Directors to its Investment Banking Department. The focus on the energy lending business is a strategic move as a result of the energy sector’s resiliency during the economic turmoil. Management also expects this sector to be most active in mergers and acquisitions, equity and debt financings with the recovery of the economy.

Recently, UBS announced its intention to close its relationship with the Swiss government by purchasing its toxic assets back from the bad bank deal and anticipated to turnaround by next year. With the recent rebound in the credit markets, the company believes that it could add its assets back to its balance sheets. However, this would not be possible before the second half of 2010.

The Director of FINMA, Switzerland’s financial independent supervisory authority, has however commented that UBS’s financial situation has now stabilized though it would take some more time to become profitable once again.

The ongoing global economic turmoil has severely hurt the Swiss banking major’s balance sheet after the subprime crisis led to record losses. In particular, the investment banking arm of UBS experienced large trading losses after significant decreases in commissions and fee income.

The bank’s asset quality is beginning to turn negative and is expected to worsen further in the coming quarters. Moreover, upon request from French tax authorities, Switzerland has recently signed an agreement to share banking information from Jan 2010. This has resulted in large fund outflows as worried investors are eyeing a safe haven. However, we expect the recent signs of economic recovery to herald happy times for UBS. Additionally, the government’s exit from UBS and such restructuring activities provide some relief to the stock.
Read the full analyst report on "UBS"
Zacks Investment Research

Equifax Grows through Partnership – Analyst Blog

Zacks Market Commentaries — Thu, 08 Oct 2009 16:15:27 +0000

Through a recent press release, Equinix Inc. (EQIX) announced that the company, in collaboration with Alcatel-Lucent (ALU), is developing an enhanced solution for the exchange of data traffic between carriers providing Ethernet services. Equinix will use Alcatel-Lucent’s service router to equip the Equinix Carrier Ethernet Exchange platform in order to deliver high performance global Ethernet services.

Equinix is looking to apply its expertise in interconnection for resolving the challenges faced by different carriers with a plan to enhance their Ethernet services. Ethernet connection generally provides quality, cost advantage and speed, but is generally provided within a geographical region. The Equinix Carrier Ethernet Exchange platform is different in the sense that it will focus on developing a multi-provider carrier Ethernet interconnection that meets Metro Ethernet Forum standards. This solution will be delivered through Equinix International Business Exchange (IBX) data centers located across the globe.

Additionally, the company is expanding its data centers across geographies. Recently, Equinix unveiled its plan to set up a 4,500 square meter or 48,400 square foot data center in Geneva , Switzerland . The company is in the process of expanding its global data center network to meet the growing demand for data center services. This second data center in Geneva falls within the company’s $1.4 billion expansion plan to be executed within the 2007 – 2010 time period, under which the company expects to expand its operations in 15 out of 18 markets, where the company operates.

We believe that the setting up of a carrier-neutral Ethernet services platform is in-line with the company’s data center expansion plans, as these services will be delivered through the company’s data centers. Alcatel-Lucent is considered to be a leader in Ethernet technology, while Equinix has around 10 years experience in developing network interconnections, so we believe that this joint venture is a good strategic move by Equinix and will provide a new dimension to the Ethernet technology.
Read the full analyst report on "EFX"
Read the full analyst report on "ESI"
Zacks Investment Research

SurModics New Licensing Deal (NASDAQ:SRDX)

Jyotsna Ramani — Wed, 07 Oct 2009 17:45:16 +0000

On early Tuesday morning, SurModics announced their new licensing deal with Roche. SurModics Inc. said that they have licensed their drug delivery technology to Roche and Roche’s Genentech unit for a deal ...

Equinix Grows Swiss Operation – Analyst Blog

Zacks Market Commentaries — Tue, 06 Oct 2009 16:30:47 +0000

At a recent press release, Equinix Inc. (EQIX) unveiled its plan to set up a 4,500 square meter or 48,400 square foot data center in Geneva , Switzerland . The company is in the process of expanding its global data center network to meet the global demand for data center services. This second data center in Geneva falls within the company’s $1.4 billion expansion plan to be executed within 2007 – 2010 in which the company expects to expand its operation in 15 out of 18 markets.

This new GV2 data center will be completed in phases. The first phase is scheduled to open in December 2009, increasing the company’s cabinet capacity by 380. The data center will have a total capacity of 780 cabinets after completion. This GV2 data center will run on the services of the company’s existing data center (GV1) which supports functions of internet service providers and telecom companies providing services to banking and non-banking companies.

As a leading provider of data center services, Equinix is well-positioned in a market that has become much less competitive over the past few years, creating a more favorable pricing environment. The company is continuously acquiring new clients, and expanding its current facilities. The company continues to exhibit fiscal discipline as well.

Equinix is committed to increasing its operations in Europe . Geneva being a good market, offers reasonable business opportunity for the company. We are positive about the company’s recurring revenue model and its expansion into the European market, which has very favorable characteristics. However, we believe that it would require significant capital expenses to build out its data centers, which may put some pressure on the financial resources of the company.
Read the full analyst report on "EQIX"
Zacks Investment Research

The Big Russia-Georgia Report

Robert Amsterdam — Wed, 30 Sep 2009 13:11:23 +0000

Unless you have been living under a rock, everybody knows all about the very big deal being made out of this very big European Union report headed up by Swiss diplomat Heidi Taglivini (she must have drawn a very short...

UBS May Leave Bad Bank Deal – Analyst Blog

Zacks Market Commentaries — Tue, 29 Sep 2009 22:26:10 +0000

UBS AG (UBS) intends to close its relationship with the Swiss government by purchasing its toxic assets back from the bad bank deal and hopes to turnaround by next year. With the recent rebound in the credit markets, the company believes that it could add back its assets to its balance sheets. However, this would not be possible before the second half of 2010.

UBS AG is engaged in a fight with FINMA, Switzerland’s financial independent supervisory authority over its plan to opt out of the bad bank scheme. Under the bad bank scheme, the company incurs hefty charges for protecting against huge losses on toxic assets. However, FINMA has ruled out such possibilities in the midst of the current unstable market. Though the Swiss government sold its 9% stake in UBS last month, around $23.5 billion of UBS assets are there in the government’s bad bank.

Of late, UBS is making headlines for all the wrong reasons. The U.S. officially started gathering account details of 4,450 UBS clients in America who allegedly evaded taxes after Switzerland agreed to provide the relevant facts.

Switzerland recently signed an agreement to share banking information from January 2010 upon request from French tax authorities. This has resulted in large fund outflows as worried investors are eyeing a safe refuge.

Swiss banks have enjoyed large foreign deposits inflows over the years as a result of the country’s tax system, which emphasizes extreme secrecy. However, the adoption of the Organization for Economic Co-operation and Development standards for tax cooperation coupled with the US Internal Revenue Service’s lawsuit against UBS have led to dilution of secrecy.

The ongoing global economic turmoil severely hurt the Swiss banking major’s balance sheet after the subprime crisis led to record losses. In particular, the investment banking arm of UBS experienced large trading losses after significant decreases in commissions and fee income. Its asset quality is beginning to turn negative and is expected to worsen further in the coming quarters. However, we expect the recent signs of economic recovery augur well for UBS.
Read the full analyst report on "UBS"
Zacks Investment Research

Citi Sells Chunk of Diners Club – Analyst Blog

Zacks Market Commentaries — Tue, 29 Sep 2009 18:44:01 +0000

Citigroup, Inc. (C) has sold off a part of its Diners Club credit card processing business to Elavon, a subsidiary of US Bancorp (USB), as it continues to rid itself of unwanted assets.

Elavon acquired Citibank's Diners Club Card merchant-location portfolio in Western Europe, which represents more than 75,000 merchants. Small and mid-size businesses that accept Diners Club cards in the region will now process their transactions through Elavon. Terms of the deal were not disclosed.

Separately, Elavon has also signed an agreement with Diners Club International, a unit of Discover Financial Services (DFS). The agreement will enable Elavon to provide processing, funding and customer support services for merchants that accept Diners Club International cards in the U.K., Ireland, France, Switzerland and Germany.

Citigroup, once the largest U.S. bank by assets, fell behind last year after a series of acquisitions by rivals. The bank has been severely hurt by billions in losses and write-downs of problem loans and toxic assets.

During the second quarter of 2009, Citigroup reported results separating the firm into Citicorp and Citi Holdings. The company is currently undergoing a major restructuring in its businesses and plans to hold down its assets and divest non-core businesses in Citi Holdings.

The U.S. government injected $45 billion in bailout funds into the bank, $25 billion of which was recently converted to a 34% ownership stake. Top-level management at the company is conceiving plans to downsize the government’s stake in the company through a multibillion-dollar stock offering.

Last week, Citigroup also decided to scale back its U.S. retail footprint to just six major metropolitan areas and limit lending mostly to wealthy customers.

Citigroup will release its third quarter 2009 earnings on Oct. 15, 2009 with a conference call scheduled later in the day to discuss its results. Ahead of its results, we maintain our Neutral recommendation on the stock.
Read the full analyst report on "C"
Read the full analyst report on "USB"
Read the full analyst report on "DFS"
Zacks Investment Research

The United States is the New Tanzania? Ugh…

Investment U — Mon, 28 Sep 2009 15:12:46 +0000

The United States is the New Tanzania? Ugh… by Robert Williams, Publisher Switzerland sits atop the overall ranking in The Global Competitiveness Report, just released by the World Economic Forum, representing the first time since 2004 that the United States doesn’t hold the top spot. But hey, that’s what being at the epicenter of a global financial [...]

Medidata Solutions: The One Healthcare Stock That’s Not Sucking Up to Washington

Louis Basenese — Fri, 25 Sep 2009 21:58:34 +0000

pWhen it comes to the healthcare debate, let’s keep one obvious fact in mind: Expenses are out of control and must be reined in. That’s true with or without a massive reform bill./p pAnd that plays right into the hands of strongMedidata Solutions Inc./strong (Nasdaq: a href="http://www.google.com/finance?q=MDSO" target="_blank"MDSO/a)./p pThe company is a leading provider of electronic data capture (EDC) and clinical data management systems (CDMS). In laymen’s terms, it helps drug companies go from the Dark Age into the Digital Age./p pAnd it’s a transformation that we desperately need. Here’s why…/p pstrongAnyone For a Tedious, Time-Consuming Paper Trail?/strongstrong /strong/p pRoughly 75% of all clinical trials – the most critical function of drug companies, yet also the biggest drain on resources ($45 billion, annually) – are done on paper./p pThat’s right.#8230;/p

Rio Tinto Reduces Debt – Analyst Blog

Zacks Market Commentaries — Fri, 25 Sep 2009 19:18:01 +0000

Rio Tinto PLC (RTP), the heavily indebted miner, has now cashed in over $7 billion in total by selling its non-core assets after its merger with Canadian aluminum group Alcan.

Last week, Rio agreed to sell its Alcan composites business to Switzerland's Schweiter Technologies for $349 million. The deal is expected to close by the end of the year.

The company targets to sell $15 billion in assets to lighten its debt burden it piled up from the $38 billion acquisition of Alcan in 2007. At the end of June 2009, Rio's total net debt was $39.1 billion. However, after the rights issue scheme in July, it managed to cut down its debt to $24.3 billion. It completed the $15.2 billion of rights issue in July.

The biggest check the company has received so far from its clearance sales was for divesting its business in Alcan's pharmaceuticals, global tobacco and food packaging divisions for $2.0 billion to Amcor Ltd in August 2009. This deal is the latest in Rio’s ongoing divestment program aimed at reducing its debt.

The company has $8.9 billion of debt maturing in 2009, $9.1 billion maturing in 2010, and another $10.0 billion in 2012.

Looking forward, we believe it is very important for the company to realize attractive prices for its assets in order to pay down debt. But if the company ends up selling non-core assets at distressed prices, meeting its debt reduction targets might be difficult.

Given the tough market conditions, we believe it could prove difficult for the company to dispose its assets at attractive prices, which in turn could have a negative impact on the shares.
Read the full analyst report on "RTP"
Zacks Investment Research

Medidata Solutions: The One Healthcare Stock That’s Not Sucking Up to Washington

Investment U — Thu, 24 Sep 2009 21:42:22 +0000

Medidata Solutions: The One Healthcare Stock That’s Not Sucking Up to Washington by Louis Basenese, Advisory Panelist When it comes to the healthcare debate, let’s keep one obvious fact in mind: Expenses are out of control and must be reined in. That’s true with or without a massive reform bill. And that plays right [...]

Swiss Banks Choose Safety Over Secrecy – Analyst Blog

Zacks Market Commentaries — Thu, 24 Sep 2009 19:00:28 +0000

On Wednesday, the US and the Swiss governments officially signed the new dual tax treaty which represents an important development for the Obama administration’s endeavor to fight international tax evasion.

The Swiss government has agreed to the international standard on exchange of data. The treaty calls for compulsory arbitration in some tax cases. It also demands changes in the dividend treatments when a pension or retirement fund holds shares.

The US government pursued a tax evasion case against UBS AG (UBS), which was settled last month with the Swiss bank agreeing to provide account details of its 4,450 American clients who allegedly evaded taxes.

Over the years, Swiss banks have enjoyed large foreign deposit inflows as its domestic tax system emphasizes extreme confidentiality. However, adoption of the Organization for Economic Co-operation and Development’s standards for tax co-operation coupled with the lawsuit between the US Internal Revenue Service and UBS led to a dilution of secrecy.

Recently, Switzerland signed an agreement for sharing banking information upon request from France's tax authorities from January 2010. There have been huge outflows of funds as anxious investors eye a safe refuge.

Formed through merger of Union Bank of Switzerland and Swiss Bank Corp. in 1998, UBS is one of the largest banks in the world. The ongoing global economic turmoil has severely hurt its balance sheet since the subprime crisis led to record losses. The investment banking arm of UBS particularly recorded large trading losses after significant decreases in commissions and fee income. Its asset quality is beginning to turn negative and is expected to worsen further in the coming quarters.

Read the full analyst report on "UBS"
Zacks Investment Research

Oxygen Biotherapeutics, Inc. (OXBO.OB) Receives Go-Ahead for Phase II-B Trial

QualityStocks — Thu, 24 Sep 2009 12:19:37 +0000

Yesterday, Oxygen Biotherapeutics, Inc. announced that the company has received approval from Israel’s Ministry of Health to begin a Phase II-b clinical trial for use of Oxycyte(R), a perfluorocarbon therapeutic oxygen carrier, in traumatic brain injuries. With four centers in Israel, the clinical trial is part of a larger study that also includes seven trial [...]

Motorola Wins Major Contract – Analyst Blog

Zacks Market Commentaries — Wed, 23 Sep 2009 15:15:00 +0000

Recently, Motorola Inc (MOT) was awarded a contract to supply EuroDOCSIS 3.0 digital video modems to UPC Broadband for its pan-European network. UPC Broadband is the European division of Liberty Global Inc (LBTYA), the largest cable TV operator in Europe.

Using Motorola’s SBV6120E EuroDOCSIS 3.0 voice and data solution, UPC will deliver high-speed (120 Mbps) data and IP voice and services to its customers in The Netherlands, Austria, Czech Republic, Hungary, Slovakia and Switzerland. The SBV6120E is part of Motorola's complete portfolio of bandwidth-expanding EuroDOCSIS 3.0-certified technologies.

EuroDOCSIS 3.0 standard is based on 8 MHz channels whereas U.S. DOCSIS 3.0 standard is based on 6 MHz channels. Motorola’s DOCSIS 3.0 solutions enable cable operators to cost-effectively introduce new value-added services, increase bandwidth for feature-rich services, generate higher return on investment, and increase revenues.

Although the financial terms of this contract haves not been disclosed, we believe the UPC contract will act as a major catalyst for the company’s cable modem termination system (CMTS) business since Motorola is quickly losing its ground to both its larger peer Cisco System Inc (CSCO) and the emerging dark-horse Arris Group Inc (ARRS).

According to a recent report of Infonetics Research, Arris has become the new world leader in the CMTS market commanding approximately 47% of the global CMTS market having taken over leadership from Cisco System (39%) and Motorola (10%).

According to our assessment, the DOCSIS 3.0 market will continue to remain healthy in the near future as Intense competition among cable operators, satellite carriers and telecom service providers for broadband market share has forced the cable MSOs to opt for cost effective bandwidth enhancing technology for high-speed network.

Major cable MSOs in the U.S. are aggressively deploying the DCOSIS 3.0 technology. This in turn may result in significant demand for Motorola’s fiber-based network architectures such as, passive optical networks and DOCSIS 3.0 solutions.
Read the full analyst report on "MOT"
Read the full analyst report on "LBTYA"
Read the full analyst report on "CSCO"
Read the full analyst report on "ARRS"
Zacks Investment Research

RA’s Daily Russian News Blast – September 23, 2009

Robert Amsterdam — Wed, 23 Sep 2009 08:42:19 +0000

TODAY: EU chief has faith that Russia will not stand in the way of sanctions against Iran; US reproaches Russia on human rights; hope for WTO bid? Yushchenko suggests NATO bid would receive popular backing; ethnic haters charged; new...

RA’s Daily Russian News Blast – September 22, 2009

Robert Amsterdam — Tue, 22 Sep 2009 08:44:04 +0000

TODAY: Chief of staff denies decisions on Kaliningrad plan; Churkin criticizes US 'cold war attitude'; arms reduction talks not progressing as smoothly as they may appear. Israel maintains choice in Iran; Russia suggests onus on NATO to improve ties;...

Behold, The Power Of Cheese… And Chocolate

Investment U — Fri, 18 Sep 2009 14:43:35 +0000

Behold, The Power Of Cheese… And Chocolate Tony Daltorio, Investment U Research The typically sleepy world of food makers woke up this week to the loud sounds of Kraft’s bold takeover offer for Cadbury. Cadbury, the confectionery company that makes Britain’s best known chocolate, has sold cocoa and chocolate since John Cadbury founded it in the [...]

What China Could Do to the Price of Gold

Bill Bonner — Wed, 16 Sep 2009 11:07:03 +0000

pem“I’m Brazilian. I have gold. And I’ve just arrived from Rio richer than anyone#8230;”/em Thus sang one of the characters in an operetta by Jacques Offenbach. But that was in the mid-19 th century. But hey#8230; what goes around#8230; /p pGuess what happened last year? According to a study from Boston Consulting Group, the only area of the world that got richer last year was Latin America#8230; led by Brazil!/p pThe rest of the world got poorer. By 11%, according to BCG. Down in the rum and sun zone, on the other hand, they got 3% richer./p pSo maybe our investments in South and Central America will turn out all right after all./p pMeanwhile, back in the developed world#8230; what’s going on? There are two#8230;/p

Bullion – a viable alternative to fiat currencies

Prieur du Plessis — Wed, 16 Sep 2009 09:38:43 +0000

Although the declining dollar has been one of the catalysts for the rise in the gold price, it is also important to note that gold bull markets are usually characterized by the metal making headway in all currencies. This is now happening with bullion rising in terms of most major (and minor) fiat (paper) currencies. Read on ...

Protectionism Wars, Here We Come!

Contrarian Profits — Mon, 14 Sep 2009 19:06:26 +0000

pCurrencies back off gains#8230;Administration slaps tariff on China#8230;And Yen rallies#8230;Quotes from Davos#8230;And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Marvelous Monday to you! I hope your weekend was grand#8230; I was supposed to be traveling back from Williamsburg today, so this is a bonus day for you all! HA! On Friday morning, I told the early arrivers that the currencies were strong, Gold was strong, it was all good, and we needed to close up shop and go home, because it wasn#8217;t going to get an better than that, and that the rest of the day had nothing but disappointment risk! Boy did I nail that one on the head! Let#8217;s get to the goings on./p pThe currencies added to their gains#8230;/p

The 4 Reasons to Skip Today’s Gold Rush

Contrarian Profits — Fri, 11 Sep 2009 20:22:59 +0000

pIn the spirit of not suffering from confirmation bias, in today’s emstrongNotes/strong/emstrong /strongwe will try to make the bearish case emagainst/em gold. So before you storm emstrongNotes/strong/em HQ in Buenos Aires craving blood, hear us out. Many of our staff here love gold and have long term holdings. /p pThis issue is entirely in the contrarian spirit of playing devil’s advocate. So put your pitchforks down. Take a deep breath. There is plenty of space to poke holes in (or rant) about our thesis by writing to a href="mailto:info@contrarianprofits.com" target="_blank"info@contrarianprofits.com/a/p pSo here it goes. The four reasons you shouldn’t buy gold today…/p pReason 1: Did you know that the seventh largest holder of gold in the world is not a country, but an exchange traded fund? Yes, gold ETF SPDR Gold Shares#8230;/p

Cemex Announces Public Offering – Analyst Blog

Zacks Market Commentaries — Thu, 10 Sep 2009 16:00:43 +0000

This week, Cemex S.A.B. de C.V. (CX) started a global public offering of 1,200 million Ordinary Participation Certificates (CPO), directly or in form of American Depositary Shares (ADS). The world’s third-largest cement producer has also given underwriters to offer up to an additional 180 million CPOs, directly or in the form of ADSs, to cover overallotments.

The offering includes 595 million CPOs that will be sold on Cemex’s behalf by three of its subsidiaries. Of the 1,200 million CPOs being offered, 900 million CPOs are expected to be offered in the United States and in other countries outside Mexico. Approximately 300 million CPOs will be offered in a concurrent public offering in Mexico. The deal is subject to market and other conditions. The company is likely to offer the CPOs on Sept. 23.

Cemex plans to use the proceeds to repay debt, which will be crucial in the coming quarters as its huge leverage is a rising concern. Net debt at the end of the second quarter was $18,272 million and is more than 5x the expected EBITDA for 2009. It is all the more urgent for Cemex as it is battling with leading cement makers like France’s Lafarge SA and Switzerland’s Holcim Ltd in a difficult market.

Cemex intends to reduce its net debt by about $3.6 billion in 2009 to reach $14.3 billion at the end of the year in order to restore financial flexibility as soon as possible and meet its financial commitments. The company is indeed making a huge effort to restore its creditworthiness and adapt itself to new and much more difficult market conditions.

Read the full analyst report on "CX"
Zacks Investment Research

DrStockPick.com Stock Report! 9/10/09, SGMA, GNBT, NOC, NLC, ZVTK, SLTM

Dr. Stock Pick — Thu, 10 Sep 2009 13:22:55 +0000

DrStockPick.com Stock Report! Thursday September 10, 2009 ************************************************************** SigmaTron International, Inc. (Nasdaq:SGMA), an electronic manufacturing services company, today reported revenues and earnings for the fiscal quarter ended July 31, 2009. Revenues decreased to $26.3 million in first quarter of fiscal 2010 from $38.5 million for the same quarter in the prior year. Net [...]

A Recovery Impersonator

Bill Bonner — Wed, 09 Sep 2009 19:06:09 +0000

pThis recovery is wonderful in every way, except the important ones. It is like a shiny new airplane. It has glossy aluminum wings. It has plush seats in the first class section. Trim stewardesses serve drinks. Movies are available on demand in all sections… /p pA majority of those polled by Bloomberg think it’s great; 61% said they thought they economy had taken off and was flying high. Stocks are up. Commodities are up. And here’s another Bloomberg headline: “Global investors give Federal Reserve Chairman Ben S. Bernanke top marks#8230;”/p pThe recovery has won the approval of economists and the public. It has almost everything going for it. It just won’t fly!/p pComes news this morning that the US economy is still on#8230;/p

This Swiss Logic Has More Holes Than Their Cheese

Investment U — Wed, 09 Sep 2009 17:20:17 +0000

This Swiss Logic Has More Holes Than Their Cheese Switzerland is the most competitive economy in the world, according to… the Swiss. Really, Switzerland? We had such respect for you before this. This study is like Detroit releasing a study that says Americans only want cars from Detroit. It’s nice to daydream, but [...]

U.S. Ousted as Most Competitive Economy

Frank Holmes — Wed, 09 Sep 2009 05:00:00 +0000

The global recession claims another victim - the United States is no longer the worlds most competitive economy. Switzerland, a beacon of relative stability during the past 18 months of worldwide economic turmoil, toppled the topsy-turvy U.S. from the No. 1 spot in the latest update of quot;The Global Competitiveness Reportquot; from the World Economic Forum. The WEF uses a wide range of metrics to measure competitiveness, which it defines as quot;the set of institutions, policies and factors that determine the level of productivity of a countryquot; as a means to produce prosperity for its citizens. The U.S. was panned in the report for too-close relationships between government regulators and the private sector, and for quot;the perception that the government spends its resources wastefully.quot; Specifically mentioned were the massive additions to the federal deficit made by the Bush and Obama administrations, used to finance the Iraq war and economic stimulus. Singapore ranked third, with Sweden, Denmark, Finland, Germany, Japan, Canada and The Netherlands rounding out the top 10. At the other end of the list, corruption- and inflation-plagued Zimbabwe - a prime example of how not to run an economic or political system - somehow managed to move up one spot from the bottom. It was replaced by Burundi at No. 133. The WEF said in its report that the three largest BRIC countries - Brazil, India and China - are among the few countries likely to improve their global competitiveness as a result of the recession. Some of the reasons: focus shift from export to domestic markets, greater efficiency by thinning out non-competitive producers, and more emphasis on improving education and other foundational issues. Each of these three also have challenges. For China (ranked 29th in the WEF report), they include lack of technology and rigid labor markets. India (49th) has to deal with huge prosperity gaps between its thriving cities and its rural areas. Brazil (56th) also has inequality issues, along with upgrading its public and private institutions. Russia, the fourth BRIC, is seen as one of the economies most likely to see negative ramifications from the recession. Its dependence on oil and natural gas exports expose it to more economic risk than the other BRIC components, which are far more diversified and have better financial markets. Weak property rights and government favoritism issues also hurt Russia (63rd, down 12 spots from a year earlier) in the rankings. Emerging Europe on the whole saw its competitiveness fall as a result of the financial crisis after years of booming consumption paid for by borrowing from foreign banks. All 492 pages of quot;The Global Competitiveness Reportquot; for 2009-10 are available *here. *This link goes to the World Economic Forum Web site. U.S. Global Investors does not endorse any information supplied by this website and is not responsible for any of 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.

U.S. Ousted as Most Competitive EconomyU.S. Ousted as Most Competitive Economy

Frank Holmes — Wed, 09 Sep 2009 05:00:00 +0000

Prieur’s readings (September 6, 2009)

Prieur du Plessis — Sun, 06 Sep 2009 05:00:17 +0000

In the absence of the “Words from the Wise” review while I am traveling, this post provides links to a number of thought-provoking articles I have read over the past few days that you may also find interesting. Please also add the links to any other worthwhile articles you would like to share to the comments section.

Switzerland’s Oldest Bank Flees America’s Iron Tax Curtain

Justice Litle Editorial Director Taipan Publishing Group — Fri, 04 Sep 2009 05:00:00 +0000

A 268-year-old Swiss bank has elected to say “Farewell America,” both figuratively and literally, as America’s iron tax curtain descends upon the world. Dark portents loom, some prophesied by an...div class="feedflare" a href="http://feeds.taipanpublishinggroup.com/~ff/taipan?a=8fDwSelENvA:A5xDnBvKSQI:yIl2AUoC8zA"img src="http://feeds.feedburner.com/~ff/taipan?d=yIl2AUoC8zA" border="0"/img/a a href="http://feeds.taipanpublishinggroup.com/~ff/taipan?a=8fDwSelENvA:A5xDnBvKSQI:V_sGLiPBpWU"img src="http://feeds.feedburner.com/~ff/taipan?i=8fDwSelENvA:A5xDnBvKSQI:V_sGLiPBpWU" border="0"/img/a a href="http://feeds.taipanpublishinggroup.com/~ff/taipan?a=8fDwSelENvA:A5xDnBvKSQI:F7zBnMyn0Lo"img src="http://feeds.feedburner.com/~ff/taipan?i=8fDwSelENvA:A5xDnBvKSQI:F7zBnMyn0Lo" border="0"/img/a a href="http://feeds.taipanpublishinggroup.com/~ff/taipan?a=8fDwSelENvA:A5xDnBvKSQI:wd9GD17jvC4"img src="http://feeds.feedburner.com/~ff/taipan?d=wd9GD17jvC4" border="0"/img/a a href="http://feeds.taipanpublishinggroup.com/~ff/taipan?a=8fDwSelENvA:A5xDnBvKSQI:l6gmwiTKsz0"img src="http://feeds.feedburner.com/~ff/taipan?d=l6gmwiTKsz0" border="0"/img/a /divimg src="http://feeds.feedburner.com/~r/taipan/~4/8fDwSelENvA" height="1" width="1"/

U.S. Asks UBS for Data – Analyst Blog

Zacks Market Commentaries — Tue, 01 Sep 2009 16:56:03 +0000

The United States has officially started the process of gathering account details on 4,450 American clients of UBS AG (UBS) who have allegedly evaded paying taxes. This formal request has been made after Switzerland agreed to provide the relevant client details.

Over the years, Swiss banks have enjoyed large foreign deposits inflows as a result of its domestic tax system, which comprised extreme secrecy. However, the adoption of the Organization for Economic Co-operation and Development (OECD) standards for tax co-operation coupled with the lawsuit between the U.S. Internal Revenue Service (IRS) and the Swiss bank UBS led to a dilution of secrecy.

Recently, Switzerland signed an agreement to share banking information upon request from France's tax authorities from January 2010. As a result, there have been huge outflows of funds as the anxious investors are eyeing a safe refuge.

UBS, formed after the 1998 merger of Union Bank of Switzerland and Swiss Bank Corporation, is one of the largest banks in the world. However, we expect this news to weigh heavily on UBS whose balance sheet has already been severely impacted by the subprime crisis and has reported record losses.

Moreover, recent global market turmoil has taken a toll on UBS, particularly at the investment bank, resulting in significantly declining commission and fee income and large trading losses. In addition, asset quality has begun to turn negative and will deteriorate further as the business cycle progresses.
Read the full analyst report on "UBS"
Zacks Investment Research

Let’s meet up – in Slovenia

Prieur du Plessis — Tue, 01 Sep 2009 09:20:43 +0000

I will be in Slovenia next week as I am taking a group of South African business people on a fact-finding mission. If you happen to be in Ljubljana on Monday, September 7, join us for a special day the Slovenian Chamber of Commerce and JAPTI have organized to facilitate interaction between our delegation and Slovenian business people. Blog posting will be slow (and totally absent on some days) while I am on the road.

Grab Secret Penny Stock Gains from the World’s Best Blue Chips

Contrarian Profits — Tue, 25 Aug 2009 21:32:35 +0000

pSo far this year, three of the world’s safest blue chip stocks returned 58.5%, 85.2%, and 112.5%, but most investors weren’t even able to touch them. Today, I’ll show you how you can…/p pThose gains came from companies you are probably already familiar with: a href="http://www.google.com/finance?q=OTC:RHHBY"Roche Holdings/a, a href="http://www.google.com/finance?q=OTC:WMMVY"Wal-Mart of Mexico/a, and a href="http://www.google.com/finance?q=ETR:ADS"Adidas/a. These three companies have a combined market cap of $177 billion, yet produced enormous penny stock-sized gains./p pBeyond being large, international, and profitable, these three have something else in common: none of them trade on a major U.S. exchange./p pRoche is Swiss, Adidas is German, and Wal-Mart of Mexico is a southern neighbor. So unless you live in Switzerland, Germany, or Mexico, you might be wondering how you can get in on#8230;/p

Manas Petroleum Corp. (MNAP.OB) is “One to Watch”

QualityStocks — Tue, 25 Aug 2009 19:04:22 +0000

Manas Petroleum Corp. is an international oil exploration and development company. Founded in 2004, they have their corporate headquarters in Baar, Switzerland. The company spent its first two years acquiring and developing their Kyrgyz Republic, Tajikistan, and Albanian projects. Trading on the OTCBB, the company’s focus is on exploring and developing projects in Southeastern Europe, [...]

BBV, PWRM, DrStockPick Watch List! for Monday August 24, 2009, Banco Bilbao Vizcaya Argentaria, S.A. and Power 3 Medical Products Inc, PWRM.OB

Dr. Stock Pick — Sun, 23 Aug 2009 20:35:40 +0000

BBV, Banco Bilbao Vizcaya Argentaria, S.A. PWRM, Power 3 Medical Products Inc, PWRM.OB DrStockPick Watch List! DrStockPick Watch List! for Monday August 24, 2009 My Picks for Monday August 24, 2009 are: ************************************************************** BBV, Banco Bilbao Vizcaya Argentaria, S.A. BBV is a financial services group with more than $750 billion in total assets, 48 million clients, 8,000 branches and approximately 108,000 [...]

Rationing? I Have to Disagree – Analyst Blog

Dirk Van Dijk — Fri, 21 Aug 2009 14:17:10 +0000

In yesterday’s Wall Street Journal, Martin Feldstein, Ronald Reagan’s top economist and a Harvard professor, claims the current health care proposals are all about rationing. I have to disagree. Excerpts from his article are below, along with my critique.

"Although administration officials are eager to deny it, rationing health care is central to President Barack Obama's health plan. The Obama strategy is to reduce health costs by rationing the services that we and future generations of patients will receive.

"The White House Council of Economic Advisers issued a report in June explaining the Obama Administration's goal of reducing projected health spending by 30% over the next two decades. That reduction would be achieved by eliminating 'high cost, low-value treatments' by 'implementing a set of performance measures that all providers would adopt' and by 'directly targeting individual providers . . . (and other) high-end outliers.'"

First and foremost, it is important to recognize that the current system already relies on rationing. It uses rationing by price. If you can’t afford the treatment, or are one of the over 47 million uninsured, tough.

However, insurance companies like Aetna (AET) and United Health (UNH) will also routinely decide that a treatment is not covered because it is too costly. For many conditions, there are several potential treatment alternatives.

The major health care reform proposals (there are currently 4 on the table, and one more is still being worked on) plan on looking at which methods work best, and eliminating costly treatment options that don’t work very well (but which might be highly lucrative to the doctor and/or hospital) in favor of lower cost, more effective options. If that be rationing, sign me up. Sounds like simple “best practices" to me.

"The president has emphasized the importance of limiting services to 'health care that works.' To identify such care, he provided more than $1 billion in the fiscal stimulus package to jump-start Comparative Effectiveness Research (CER) and to finance a federal CER advisory council to implement that idea.

"That could morph over time into a cost-control mechanism of the sort proposed by former Sen. Tom Daschle, Mr. Obama's original choice for White House health czar. Comparative effectiveness could become the vehicle for deciding whether each method of treatment provides enough of an improvement in health care to justify its cost."

Could, could, could -- but Marty, you provide absolutely no evidence as to the probability of that occurring. If the CER finds, for example, that radiation therapy is more effective than surgery for the treatment of a certain type of cancer, and that radiation therapy is also 30% less expensive, it seems downright stupid to keep having doctors do a lot of that type of surgery. The surgeons might make less money, but that is not anything like the specter that has been floated of the government denying care to old folks.

"In the British national health service, a government agency approves only those expensive treatments that add at least one Quality Adjusted Life Year (QALY) per £30,000 (about $49,685) of additional health-care spending. If a treatment costs more per QALY, the health service will not pay for it.

"The existence of such a program in the United States would not only deny lifesaving care, but would also cast a pall over medical researchers who would fear that government experts might reject their discoveries as 'too expensive.'"

There is nothing in any of the proposals that would prevent people from paying extra to get these marginal treatments, either by paying out of pocket or through supplemental insurance. It would not deny lifesaving care, it would simply decline to pay for every procedure, regardless of how expensive or how ineffective.

It might also focus researchers to look for treatments that bring down costs and are more effective. Those procedures would get a much bigger market share and would be very lucrative.

"One reason the Obama Administration is prepared to use rationing to limit health care is to rein in the government's exploding health-care budget. Government now pays for nearly half of all health care in the U.S. , primarily through the Medicare and Medicaid programs.

"The White House predicts that the aging of the population and the current trend in health-care spending per beneficiary would cause government outlays for Medicare and Medicaid to rise to 15% of GDP by 2040 from 6% now. Paying those bills without raising taxes would require cutting other existing social spending programs and shelving the administration's plans for new government transfers and spending programs."

Note that government spending is about 20% of GDP now, so it is not just existing social spending programs that would have to be cut, but just about everything. That includes the military. Going on the current trajectory on health care spending has the potential to seriously harm national security.

"The rising cost of medical treatments would not be such a large burden on future budgets if the government reduced its share in the financing of health services. Raising the existing Medicare and Medicaid deductibles and coinsurance would slow the growth of these programs without resorting to rationing. Physicians and their patients would continue to decide which tests and other services they believe are worth the cost.

"There is, of course, no reason why limiting outlays on Medicare and Medicaid requires cutting health services for the rest of the population. The idea that they must be cut in parallel is just an example of misplaced medical egalitarianism."

“Misplaced medical egalitarianism" -- we are talking life and death here! Every year, 18,000 Americans die prematurely because they lack access to proper medical care. That is more than 6x as many who died when the Twin Towers came down.

Raising the deductibles and coinsurance for Medicaid? Just who does the good Harvard professor think is on Medicaid? Here is a news flash for ya, Marty -- it's poor people. This would result in rationing of the very worst sort, not you get treatment A instead of treatment B because A is more cost effective, but you get no treatment at all and just suffer or die.

If Grandma can’t afford the higher deductable and copayment then what happens? Does the plug get pulled? Does he seriously think that runaway medical cost inflation outside of Medicare and Medicaid is not a problem for the economy, even though costs in those two programs have already been rising slower than overall medical costs?

"But budget considerations aside, health-economics experts agree that private health spending is too high because our tax rules lead to the wrong kind of insurance. Under existing law, employer payments for health insurance are deductible by the employer but are not included in the taxable income of the employee.

"While an extra $100 paid to someone who earns $45,000 a year will provide only about $60 of after-tax spendable cash, the employer could instead use that $100 to pay $100 of health-insurance premiums for that same individual. It is therefore not surprising that employers and employees have opted for very generous health insurance with very low copayment rates.

"Since a typical 20% copayment rate means that an extra dollar of health services costs the patient only 20 cents at the time of care, patients and their doctors opt for excessive tests and other inappropriately expensive forms of care. The evidence on health-care demand implies that the current tax rules raise private health-care spending by as much as 35%.

"The best solution to this problem of private overconsumption of health services would be to eliminate the tax rule that is causing the excessive insurance and the resulting rise in health spending. Alternatively, Congress could strengthen the incentives in the existing law for health savings accounts with high insurance copayments. Either way, the result would be more cost-conscious behavior that would lower health-care spending."

The result would be to push people out of group employer-sponsored plans and into the individual health insurance market. That market is FAR more abusive than the employer group market. That is where people get rejected for pre-existing conditions. That is where people get their health care coverage cancelled on the flimsiest of excuses as soon as they file a serious claim and actually need the insurance.

While I agree that the self-employed and those who are working for small businesses that don’t offer health benefits deserve a break, absent something reasonable to replace it, it would be reckless to dismantle the employer sponsored system. Now if you want to argue for scrapping the system and replacing it with a single-payer Medicare for All system, that would make a lot of sense.

Our current system is not something that anyone designed, but an outgrowth of wage controls during WWII, and is not what anyone starting from scratch would design. It is the system we have in place, and without a replacement it would be dangerous to get rid of it.

"But unlike reductions in care achieved by government rationing, individuals with different preferences about health and about risk could buy the care that best suits their preferences. While we all want better health, the different choices that people make about such things as smoking, weight and exercise show that there are substantial differences in the priority that different people attach to health.

"Although there has been some talk in Congress about limiting the current health-insurance exclusion, the Administration has not supported the idea. The unions are particularly vehement in their opposition to any reduction in the tax subsidy for health insurance, since they regard their ability to negotiate comprehensive health insurance for their members as a major part of their raison d'être."

Funny, the AFL-CIO has long argued for a single-payer system, one that would completely eliminate that major part of their raison d’etre. It is not just about your preferences for spending more or less on health care. Demand is the combination of desire for something plus the ability to pay for it. If you are poor, your desire to live and not to suffer counts for nothing in the world that Dr. Feldstein inhabits.

"If changing the tax rule that leads to excessive health insurance is not going to happen, the relevant political choice is between government rationing and continued high levels of health-care spending. Rationing is bad policy. It forces individuals with different preferences to accept the same care.

"It also imposes an arbitrary cap on the future growth of spending instead of letting it evolve in response to changes in technology, tastes and income. In my judgment, rationing would be much worse than excessive care.

"Those who worry about too much health care cite the Congressional Budget Office's prediction that health-care spending could rise to 30% of GDP in 2035 from 16% now. But during that 25-year period, GDP will rise to about $24 trillion from $14 trillion, implying that the GDP not spent on health will rise to $17 billion in 2035 from $12 billion now. So even if nothing else comes along to slow the growth of health spending during the next 25 years, there would still be a nearly 50% rise in income to spend on other things.

"Like virtually every economist I know, I believe the right approach to limiting health spending is by reforming the tax rules. But if that is not going to happen, let's not destroy the high quality of the best of American health care by government rationing and misplaced egalitarianism."

For starters there is a typo in the article, it is to $17 trillion, not billion. Leaving that aside, using his numbers, if we could just keep spending at 16% of GDP (keep in mind the next highest level of spending in the OECD is Switzerland at 11% of GDP, and everyone knows what a hellhole Swiss hospitals are), we are talking about a difference of $3.36 Trillion a year by 2035. That is a lot of money in my book.

Dr. Feldstein must have an awfully small circle of economists he knows (doubtful) to make that statement. There are few questions in economics that are universally agreed upon, and that is certainly not one of them. Taxing “platinum plans" might be a useful way to raise some of the revenues needed to help cover the uninsured, but to think just changing the tax code would solve the problem by itself is just plain silly.

The high quality of the best of American health care means little if it is only available to a tiny fraction of the population. If a few people ride around in Mercedes and Bentleys and most people have to walk does that mean you have a great transportation system? The claim that America has the best health care system in the world is not one that Dr. Feldstein should be making.

On every major public health indicator tracked by the World Health organization the U.S. is way down the list, and overall we rank neck and neck with Cuba, and far below places like France, Canada or the U.K. Sometimes when you pay the most, you get the best, other times it just means you are getting ripped off. The latter is clearly the case with the U.S. health care system.
Read the full analyst report on "AET"
Read the full analyst report on "UNH"
Zacks Investment Research

J&J Gets FDA Warning – Analyst Blog

Zacks Market Commentaries — Thu, 20 Aug 2009 22:30:51 +0000

We are disappointed with the Food and Drug Administration’s (FDA) warning to Johnson & Johnson (JNJ) on clinical trial related issues. The agency cautioned the company for not maintaining proper records and checks during the trial of ceftobiprole. Ceftobiprole is a broad-spectrum antibiotic for methicillin-resistant staphylococcus aureus (MRSA) and is being studied for the treatment of complicated skin infections and nosocomial pneumonia. In 2005, Basilea Pharmaceuticals licensed the drug to J&J.

The new drug application (NDA) for the drug is pending since May 2007. Protocol related issues came up even during the initial stages. In November 2008, the FDA issued a Complete Response letter asking J&J to conduct additional audit work of clinical investigation sites and to address questions related to site monitoring.

The latest decision by the FDA proves that the company has not been able to convince the agency yet. Some of the violations include inability to ensure proper storage of the drug while patients were using it at home, failure to maintain proper documents on the dosage, not examining all the patients thoroughly, enrolling some patients who did not meet its own eligibility criteria for the study and hiring unqualified investigators.

Apart from the postponement of the FDA’s decision, the European Union (EU) also delayed a ruling on the drug last February. The review process has been halted until a Good Clinical Practice inspection is completed. The drug was launched in Canada and Switzerland last year under the trade name Zeftera.

The concerns raised by the FDA will push back the NDA approval. At present, Johnson & Johnson has 15 working days to explicate its corrective action. The FDA has threatened to take “regulatory action" if the company fails to give a detailed response. We hope J&J comes up with a comprehensive map of the course of corrective action to satisfy the FDA.

Read the full analyst report on "JNJ"
Zacks Investment Research

STM Enhances Digital TV Experience – Analyst Blog

Zacks Market Commentaries — Wed, 19 Aug 2009 15:45:03 +0000

In order to meet the growing global demand for accessing digital terrestrial television services, STMicroelectronics NV (STM) recently introduced a single-chip DVB-T silicon tuner that enables manufacturers to simplify product assembly and supply-chain management.

As consumers switch from analog to digital television broadcasting, the demand for digital set-top boxes and integrated digital televisions (iDTVs) is on the rise. This transition has already taken place in nine countries, including the USA, parts of Europe and Scandinavia, and is underway in other nations.

With its STV4100, the company offers complete chipsets for digital-terrestrial receivers, including the tuner and a choice of demodulators, MPEG decoders and combined demodulator/decoder ICs.

Silicon tuners are replacing those supplied by third-party providers, which combine multiple discrete components in a metal enclosure and must be individually adjusted for optimum performance. STMicroelectronics’ new device saves up to 30 separate components, has a compact QFN 5 x 5mm footprint and needs no adjustment. Moreover, operation on only 600mA of electricity helps to minimize power consumption of products like set-top boxes, iDTVs, PC-TV receivers, and DVD or Blu-ray recorders.

The STV4100 is in production and is priced at $1.80 in quantities of 10,000 units. STMicroelectronics also announced the general availability of PGI Visual Fortran (PVF) Release 9.0 for Windows workstations, servers and clusters. PVF 9.0 is the first product that supports building, launching and debugging of Microsoft MPI (MSMPI) Fortran applications within the Microsoft Visual Studio integrated development environment.

Based in Geneva, Switzerland, STMicroelectronics is a global independent semiconductor company. It designs, develops, manufactures and markets a broad range of semiconductor integrated circuits (ICs) and discrete devices. These gadgets are used in a wide variety of microelectronic applications, including telecommunication systems, computer systems, consumer products, automotive products, industrial automation and control systems. Its major competitors are Texas Instruments Inc. (TXN) and Infineon Technologies.

Read the full analyst report on "STM"
Read the full analyst report on "TXN"
Read the full analyst report on "IFNNY"
Zacks Investment Research

The Four Stages of a Bear Market

Frank Holmes — Tue, 18 Aug 2009 05:00:00 +0000

Global markets have been in decline the past several trading days and many are now asking, is the rally over? If history is any guide, a correction is coming but wersquo;re not there yet. Morgan Stanley recently evaluated the performance of 19 bear markets in different countries around the world. Itrsquo;s a comprehensive list that includes the bear market in Switzerland during the 1960s, Japan in the 1990s and Australia in the 1980s among others. What they found is that the median fall from a marketrsquo;s peak is 56 percent and lasts 29 months. The Samp;P fell 58 percent over 18 months from its peak in October 2007. U.S. markets have rebounded roughly 51 percent in 5 months from March lows but the median bear market rebound is 70 percent over 17 months. This suggests the market rally still has some legs. However, Morgan Stanley discovered that 12 of 18 equity market rebounds stalled 1 to 3 months prior to interest rates being raised. Their conclusion was that when governments begin to withdraw stimulus, the market begins to falter. It doesnrsquo;t appear that will be a problem in the U.S. The Fed made it clear last week they were prepared to keep interest rates low for an extended period of time and that deflation remained their chief concern. In addition to our monetary efforts, there are some fiscal policies that should aid us along. With more than half of American Recovery Act money waiting to be distributed, the government has the funds allocated to continue stimulating the economy even if we see conditions improve. The danger will be if we become too complacent in our recovery before economic strength has been fully restored. 09-568

European ETF Giant Sets Sight On U.S. Commodities Market

IndexUniverse Staff — Tue, 18 Aug 2009 04:00:00 +0000

ETF Securities made a big splash with its new silver fund, SIVR. Next up on its wish list are funds focusing on gold, platinum and palladium.

William Rhind is head of sales and marketing at ETFS Marketing LLC, the U.S. arm of London-based ETF Securities. The U.S. unit opened operations in July with the launch of its first exchange-traded fund, the ETFS Silver Trust (NYSEArca: SIVR).

The former iShares executive for Barclays Global Investors’ European operations recently discussed with IndexUniverse.com’s Murray Coleman plans by ETFS to expand in the U.S. marketplace.

IU: Has a move into the U.S. been something that ETFS has been considering for awhile?

Rhind: Our chairman, Graham Tuckwell, invented the gold ETF in 2003 and launched the first gold ETF in Australia. The first ETF in the U.S., the SPDR Gold Shares (NYSEArca: GLD), was made possible by the structure invented by Graham. After launching the first gold product, ETF Securities was established in 2005, and we built the largest exchange-traded commodities business in Europe.

IU: And that led you to the U.S.?

Rhind: Yes. When you get to the size we are now, we feel very strongly that we want to be the leading provider of exchange-traded commodities products in the world. The natural extension to our franchise in Europe is to expand into the U.S.

We think the U.S. equity ETF market is very competitive and arguably very saturated. But we feel that the U.S. commodities marketplace is under-served. We want to set new standards for transparency and education and service in the U.S. commodity ETF market and see ample opportunities for future expansion.

IU: What areas could those expansion plans lead to in terms of new types of products?

Rhind: At the moment, if you look at our filings with the SEC, you can see that we’re initially planning on launching precious metals products in the U.S. (See full story here.) In Europe, we essentially offer all types of commodities products from single commodities to baskets and indices. In the U.S., we’d like to at least offer a subset of those products here initially.

IU: Specifically, what else is in your U.S. pipeline?

Rhind: We recently launched the ETFS Silver Trust. (See related story here.) SIVR is designed to track the price of silver, less the associated expenses. SIVR has been very well received in the U.S. and now has assets under management of over $85 million. We have also filed for gold, platinum and palladium. The palladium exchange-traded product would be the first of its kind in the U.S.

That would be true with the platinum as well. The gold product will compete against GLD. We’re still in the registration period, so I can’t say too much other than what is publically available, but the key difference is that the gold will be stored in Switzerland rather than the U.S. or London, as GLD does. By having a product vaulted in Switzerland, it removes concerns about the nationalization of gold as a product in the U.S. In 1933, the U.S. government confiscated personal holdings of gold through a special presidential order.

IU: Isn’t your existing European gold ETF stored in London?

Rhind: Yes, by providing two separate gold ETFs, we’re allowing for more diversification on the part of investors worldwide.

IU: The gold ETF is going to use J.P. Morgan as the head custodian. Why not appoint a Swiss custodian directly?

Rhind: Essentially, they’re a large precious metals custodian with tremendous resources to handle a large-scale global business. So we believe that scalability is going to be important. We want to work with someone who can facilitate the business as it grows, and J.P. Morgan is a partner who can provide that.

IU: How do you view the regulatory environment for commodities investing in the U.S.?

Rhind: The CFTC is investigating behavior in certain futures markets. But the commodity market as a whole continues to function the way it always has. When it comes to commodity ETFs, there has been some scrutiny on some of the energy products that utilize futures contracts. However, the SEC just approved issuance of additional shares for UNG [U.S. Natural Gas Fund] which is a positive step for the industry.

I think the majority of people recognize that ETF or index investors are generally long-term investors by nature. They want transparency, liquidity and stability in markets. Overall, we feel there is a positive regulatory environment in the U.S. for new commodity ETFs. People accept and understand physical asset-backed commodities funds like gold or silver, and the return profile is easy to understand. After all, gold funds actually physically hold bullion and silver funds like SIVR actually holds silver bullion.

IU: Commodities are still just a small portion of most investment portfolios, aren’t they?

Rhind: Correct, but they’ve been becoming ever larger, especially during the past 12 months. Traditionally, people have been allocating 2-3% to commodities. But we’ve been seeing in some places that now up to 5-8%. That’s one area of growth in the U.S. market for us. And naturally, there are going to be more products as we broaden our fund offerings. People will be able to allocate to different commodities in different sectors. A pension fund, for example, probably wants to hold a broadly diversified commodities ETF.

As we build our business, we’re certainly going to have more than just precious metal funds. We want to develop a one-stop shop where investors can come and find any type of commodity investment they’d like. That’s what we have in Europe, with about $12.5 billion in assets under management. We’ve got more than 130 ETFs worldwide. We firmly believe the U.S. business could be bigger than the European business.

IU: In Europe, you’re mainly focused on commodities. But you’ve also been branching into different asset classes, haven’t you?

Rhind: Yes, and it has only been within the past several months. That’s a very new business for us and represents about $200 million of our total assets. But we want to build the biggest and best business in the U.S. Right now, we’re just focused on building our commodity business in the U.S. However, we reserve the right to expand into other asset classes at some point. But for right now, we want to become the No. 1 provider of commodity ETFs in this market.

(Editor's note: This story also appears on IndexUniverse.com's sister European site here.)

What Do We Owe, And To Whom?

QualityStocks — Fri, 14 Aug 2009 19:30:16 +0000

You may have noticed that you’re hearing a lot about America’s national debt recently. No doubt you’ll be hearing a lot more about it in the future. And, along with it, you’ll be hearing a lot more of the “T” word (trillion). In fact, it’s about the only time the average person will ever hear [...]

Mixed Ruling for Amgen’s Drug – Analyst Blog

Zacks Market Commentaries — Fri, 14 Aug 2009 17:05:51 +0000

Yesterday, the U.S. Food and Drug Administration's (FDA) advisory panel ruled in favor of Amgen’s (AMGN) osteoporosis drug denosumab (proposed trade name: Prolia), but with certain exceptions.

While the advisory panel unanimously gave its stamp of approval to the injectable drug for prevention of bone fractures in women with postmenopausal osteoporosis, it stated that the drug should only be used by patients facing the highest risk of fractures. The ruling was based on safety and efficacy data from 30 studies of the drug involving more than 12,000 patients.

However, the panel did not approve use of the drug in the prevention and treatment of bone loss in women with breast cancer undergoing hormone ablation. It demanded additional data to ensure that denosumab would not hasten tumor growth in such patients, but supported use of the drug for prostate cancer as it appeared safer for men.

The committee also did not approve Prolia as a preventive measure for women with low bone density. The panel asked Amgen to provide more detailed data on denosumab before recommending it to patients who do not suffer from bone disease. It advised Amgen to submit a Risk Evaluation and Mitigation Strategy for Prolia, which could include a medication guide and a healthcare provider communications plan.

Even though the panel's advice is not binding on the FDA, it usually follows the ruling. The agency has set a Prescription Drug User Fee Act (PDUFA) action date of October 19. Prolia is also under review in the European Union, Australia and Switzerland, where GlaxoSmithKline (GSK) will market the potential multi-billion dollar blockbuster drug.

Despite only a partial nod from the panel, we feel that Amgen will be able to address safety concerns on Prolia and position it for blockbuster status. With all key products set to lose patent protection over the next few years (Enbrel - 2012, Epogen - 2013, Neupogen - 2013, Aranesp - 2014, and Neulasta – 2015), the company is depending on the approval and successful commercialization of denosumab.

We believe the candidate has potential to emerge as a leading cure for osteoporosis and will cater to a huge market, once launched. Osteoporosis affects about 10 million Americans, while nearly 45 million people are at risk. Global sales of osteoporosis medication hit $8.4 billion last year, including vitamin brands and drugs like Glaxo’s Boniva and Merck's (MRK) Fosamax.

We are bullish on denosumab, but any hiccup, either with respect to a delay at the FDA, a miss in any of the other ongoing late-stage programs, or safety concerns post-launch, will weigh heavily on the shares. We have a Neutral rating on Amgen.

Read the full analyst report on "AMGN"
Read the full analyst report on "MRK"
Read the full analyst report on "GSK"
Zacks Investment Research

Germany France Exit The Recession

Contrarian Profits — Thu, 13 Aug 2009 15:05:11 +0000

pCurrencies rally#8230; Eurozone growth unexpectedly stronger! FOMC extends QE#8230; Norges is the first!br / And Now#8230; Today#8217;s Pfennig!br / Good day#8230; And a Tub Thumpin#8217; Thursday to you! Well#8230; Turn-around Tuesday came 24 hours later this week! HA! Yes, the currencies came back yesterday, but not with a lot of conviction#8230; You see#8230; Stocks rallied, but that doesn#8217;t mean what I talked about yesterday still won#8217;t happen#8230; Be careful there!/p pThe euro has received some additional love this morning, as the Eurozone#8217;s economic growth printed better than expected, albeit still negative#8230; But#8230; Germany and France showed growth, which I must say is very unexpected! That means that both Germany and France have exited the recession#8230; Well, that is at least for now! For those of you keeping score#8230;/p

Trading Currency Crosses…

Trading School — Thu, 13 Aug 2009 10:00:29 +0000

The risk and sheer volatility of the forex market can be enough to scare away new comers. As with anything a good education is essential to be successful. Today Mike from FxMadness.com is going to cover the basics of forex pairs. Be sure to check it out and comment with your own forex experiences. ============================================================================= The Majors. For [...]

Manas Petroleum (MNAP.OB) Drills Second Well in Kyrgyzstan

QualityStocks — Thu, 13 Aug 2009 01:54:18 +0000

Manas Petroleum reported that it has started drilling its second exploratory well in Kyrgyzstan, a country located in central Asia. The well, called the Huday Nazar SPC-1, is set to be drilled to a depth of 2400 meters and take from 30-40 days to complete. The company has six exploration licenses in Kyrgyzstan covering 3,152 [...]

UBS Refuses to provide names – Swiss Law Stands

Alex Stanczyk — Tue, 11 Aug 2009 13:29:46 +0000

A great win today for financial privacy. Not to mention rule of law. U.S. Lets Swiss Banking Giant UBS Off the Hook Traditions die hard. Since the founding of the Swiss Confederation in 1291, Switzerland has protected the privacy of its financial accounts. It may be the world#8217;s most secretive banking jurisdiction, with a vaunted ability to [...]div class="feedflare" a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=YHcWJye8AN0:9mK9FpBr2QM:yIl2AUoC8zA"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?d=yIl2AUoC8zA" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=YHcWJye8AN0:9mK9FpBr2QM:F7zBnMyn0Lo"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?i=YHcWJye8AN0:9mK9FpBr2QM:F7zBnMyn0Lo" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=YHcWJye8AN0:9mK9FpBr2QM:7Q72WNTAKBA"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?d=7Q72WNTAKBA" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=YHcWJye8AN0:9mK9FpBr2QM:V_sGLiPBpWU"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?i=YHcWJye8AN0:9mK9FpBr2QM:V_sGLiPBpWU" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=YHcWJye8AN0:9mK9FpBr2QM:qj6IDK7rITs"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?d=qj6IDK7rITs" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=YHcWJye8AN0:9mK9FpBr2QM:l6gmwiTKsz0"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?d=l6gmwiTKsz0" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=YHcWJye8AN0:9mK9FpBr2QM:gIN9vFwOqvQ"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?i=YHcWJye8AN0:9mK9FpBr2QM:gIN9vFwOqvQ" border="0"/img/a /div

“Advances in Development Reverse Fertility Declines” – Science or Hocus Pocus?

Edward Hugh — Sun, 09 Aug 2009 08:28:00 +0000

by Edward Hugh: : L'Escala de Empordàbr /br /According to a once-upon-a-time post on the Economist's a href="http://www.economist.com/blogs/certainideasofeurope/2007/07/a_fistful_of_reply.cfm#list-comments"Certain Ideas of Europe Blog/a Edward Hugh “was very cross” about some of the journalism they were serving up over at that prestigious journal. Well, not to worry, since this time he is hopping mad. And the issue which lies behind his wrath is essentially the same one, how to interpret and understand the demographic processes which are currently so evidently affecting our societies. In what is simply the latest episode in a long and sorry saga (if you want documentation, please see the comments Claus Vistesen and I nailed to their "Wall" in the above linked post) this week's print issue contains a href="http://www.economist.com/sciencetechnology/displaystory.cfm?story_id=14164483"a research review from their science and technology correspondent/a who is evidently not backward in coming forward with headline grabbing claims. According to the said corresponedent the demographic transition (a process which has been ongoing for over two hundred years now) has finally and definitively gone into reverse gear:br /blockquote"One of the paradoxes of human biology is that the rich world has fewer children than the poor world. In most species, improved circumstances are expected to increase reproductive effort, not reduce it, yet as economic development gets going, country after country has experienced what is known as the demographic transition: fertility (defined as the number of children borne by a woman over her lifetime) drops from around eight to near one and a half. That number is so small that even with the reduced child mortality which usually accompanies development it cannot possibly sustain the population.br /br /If Mikko Myrskyla of the University of Pennsylvania and his colleagues are correct, though, things might not be quite as bad as that. A study they have just published in Nature suggests that as development continues, the demographic transition goes into reverse."/blockquotebr /br /Well quite a strong claim is being made here. The idea that a group of researchers have come up with a finding that shows the "rule....that people have fewer children as their countries get richer...no longer holds true" is certainly not one to be sniffed at. Such a strong claim needs some very heavy backing you would think, given all the research that has gone into the topic in recent years.br /br /In fact, the research makes no such direct claim, since Myrskylä et al simply find statistically significant evidence for a reversal in the relationship between the human development index (HDI)br /and the total fertility rate (Tfr) at HDI levels around 0.85–0.9. The rest is only interpretation. As we will see, to move from a simple statististical correlation to formulating a hypothesis you need an explanatory framework, and you need to be able to make falsifiable predictions. The Nature letter from Myrskylä et al is far from being at this stage of development. They have simply found an interesting correlation, and the rest is in the eye of the observer.br /br /blockquote"Back in 1975, a graph plotting fertility rate against the Human Development Index fell as the Human Development Index rose. By 2005, though, the line had a kink in it. Above an HDI of 0.9 or so, it turned up, producing what is known in the jargon as a “J-shaped” curve (even though it is the mirror image of a letter J). As the chart shows, in many countries with really high levels of development (around 0.95) fertility rates are now approaching two children per woman. There are exceptions, notably Canada and Japan, but the trend is clear."/blockquotebr /br /However, according to the Economist the trend is clear. But is it? Edward has been doing some digging.br /br /In fact the problem goes beyond the Economist, since the source behind the article is a letter published in Nature. Below a href="http://www.nature.com/nature/journal/v460/n7256/full/nature08230.html"you can read that letter/a.br /br /blockquote"During the twentieth century, the global population has gone through unprecedented increases in economic and social development that coincided with substantial declines in human fertility and population growth rates. The negative association of fertility with economic and social development has therefore become one of the most solidly established and generally accepted empirical regularities in the social sciences. As a result of this close connection between development and fertility decline, more than half of the global population now lives in regions with below-replacement fertility (less than 2.1 children per woman. In many highly developed countries, the trend towards low fertility has also been deemed irreversible. Rapid population ageing, and in some cases the prospect of significant population decline, have therefore become a central socioeconomic concern and policy challenge10. Here we show, using new cross-sectional and longitudinal analyses of the total fertility rate and the human development index (HDI), a fundamental change in the well-established negative relationship between fertility and development as the global population entered the twenty-first century. Although development continues to promote fertility decline at low and medium HDI levels, our analyses show that at advanced HDI levels, further development can reverse the declining trend in fertility. The previously negative development–fertility relationship has become J-shaped, with the HDI being positively associated with fertility among highly developed countries. This reversal of fertility decline as a result of continued economic and social development has the potential to slow the rates of population ageing, thereby ameliorating the social and economic problems that have been associated with the emergence and persistence of very low fertility."/blockquotebr /br /br /Here is the chart (reproduce from Nature data) which the Economist presents to illustrate the 'J curve' relationship.br /br /a href="http://3.bp.blogspot.com/_ngczZkrw340/Sn1c5QH2KJI/AAAAAAAAOw8/9EElMH7Rg3w/s1600-h/Nature+Chart.png"img style="TEXT-ALIGN: center; MARGIN: 0px auto 10px; WIDTH: 252px; DISPLAY: block; HEIGHT: 277px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5367548469545674898" border="0" alt="" src="http://3.bp.blogspot.com/_ngczZkrw340/Sn1c5QH2KJI/AAAAAAAAOw8/9EElMH7Rg3w/s400/Nature+Chart.png" //abr /br /Nice, isn't it? Nature even go to the lengths of a putting up a special "event" podcast featuring an interview with Hans Peter Kohler (a href="http://www.nature.com/nature/podcast/"click here for link/a) as if to underline the importance of the "finding") But does any of this have any compelling validity?br /br /Methinks not as much as the authors of the letter, or those who are covering it in the media, are trying to make out. There are many issues which are raised here, but I would just like to mention three.br /br /The first is the decision of the research team to work with a period based fertility measure which is known to be very unreliable for "tempo" reasons (the Total Fertility Rate- Tfr) as the basis for a longitudinal study. And let us remember, the authors only really claim to have found a correlation between HDI levels in the 0.85–0.9 range and movements in the Tfr, and there could be many explanations for this. Indeed the authors themselves even offer one of them in their supplementary information - "countries at development levels near the critical level HDI = 0.86 might have a more rapid postponement of childbearing than more advanced countries.. " - a possibility which, in fairness to the authors, they try to test for.br /br /And you don't have to rely on me for the suggestion that the Tfr is hardly the most desireable measure for what they want to do, since the authors themselves point this very fact out in the supplementary information (and the only thing which surprises me is that nobody else who has reviewed the research seems to have twigged the implications of this). So the very title of the Letter is totally misleading, they have not found that "Advances in Development Reverse Fertility Declines" -since in the first place the direction of causality is not adequately determined (it might be that reverses in fertility decline advance development, as I try to show in a piece referenced below) and in any event the research only shows movements in the HDI correlate with movements in the Tfr (and not with "fertility").br /br /blockquoteThe recent literature on low fertility in developed countries has pointed to the important role of delayed childbearing, that is, the ongoing postponement of childbearing to increasingly later ages. In the context of this paper, delayed childbearing is potentially important because the postponement of childbearing can distort the total fertility rate as a measure of the quantum (or long-term level) of fertility. “Tempo effects”, or the reductions in the total fertility rate resulting from a postponement of childbearing, have been shown to partially explain the very low fertility rates observed in some European countries./blockquotebr /br /So this is the first issue. Due to the phenomenon of birth postponement, the Tfr is a hopelessly unreliable indicator, and what is often called "the birth recovery" is in fact a statistical issue produced by the fact that the Tfr first sinks to very low levels (the birth dearth) and then recovers as women reach the new (higher) childbearing age. Since all of this is simply so obvious, I am absolutely astounded that two such well known and highly respected demographers - Hans-Peter Kohler and Francesco Billari - have placed their name on a piece of research that could almost be described as a publicity stunt. I am even more astounded by the way Nature appear to have been hoodwinked.br /br /Basically, I don't think that there can be any doubt that if they used a more comprehensive measure of fertility - say completed cohort fertility - they wouldn't get the correlation they claim to have found, since CFRs never fell so low, and have not bounced back in the same way. This is essentially because this indicator removes the temporal component found in the TFR (older first birth ages among women in developed societies) and only focuses on quantity. True, they did carry out a robustness test using an adjusted Tfr, but the results are much weaker, and the sample far from satisfactory (at least for the claims being made), and the authors well know this (see below).br /br /In their longitudinal study the authors look at Tfrs for a number of countries over the period 1975 to 2005 and compare these to the lowest Tfr reading observed while a country's HDI was within the 0.85–0.9 window. For all countries considered, the HDI in 2005 was found to be higher than the HDI in the reference year. For 18 of the 26 countries that attained a HDI 0.9 by 2005, the Tfr in 2005 was found to be higher than the TFR in the reference year. As I say, this is hardly surprising, given the tempo impact on Tfrs. The "2005 18" are Norway, the Netherlands, the United States, Denmark, Germany, Spain, Belgium, Luxembourg, Finland, Israel, Italy, Sweden, France, Iceland, the United Kingdom, New Zealand, Greece and Ireland.br /br /Perhaps it is more surprising (and interesting) to learn that they found six countries where the HDI was over 0.9 but where the Tfrs didn't pick up: Japan, Austria, Australia, Switzerland, Canada and South Korea. Clearly the absence of "rebound" in even the Tfrs is something of a cause for preoccupation in these countries, and examining the background to what is happening in these countries could at the end of the day turn this research into something quite interesting. That is to say, if for their level of development we might have expected the tempo effect to be more or less over, why do some countries continue to have very low fertility levels?br /br /Basically, to shoot a hole straight through their hypothesis (falsify it that is, surely in science things should be falsifiable), I would say it is only necessary to find a significant number of countries in the first group where fertility as measured by a better indicator didn't rise. Unfortunately we don't have a really good time series for such an indicator, but Eurostat have published statistical estimates for Completed Cohort Fertility Rates (Cfrs) for EU countries up to the 1989 cohort. That is, estimates of what fertility is likely to be for women who were 30 in 2009. Looking at this data, the following countries would appear to offer no evidence whatever for a rebound in cohort fertility in what we know to dat: Norway, Netherlands, Denmark, Germany, Italy, Finland, Sweden, France, Iceland, the UK, Greece and Ireland. That is to say, as far as I am concerned, the whole hypothesis falls till at least subsequent data confirm it.br /br /I haven't been able to check foir the US (but the Cfr is probably up) Israel (also) or New Zealand. Belgium has little available data. So the only two European countries which you could say with some degree of security actually could confirm the hypothesis would be Luxembourg and Spain - but if you just look at the increases in Spain - from 1.34 to 1.35 - and think about the fact that 5 million new migrants arrived (mainly in childbearing ages) between 2000 and 2009, then the result is hardly dramatic, and if you look what just happened to the economy, it is more than likely that GDP per capita is plummeting, and and household income (which has a weighting of more than one third in the HDI) with it. Which brings me to the second question, the reference year. But before I move on to that, as I say above, the authors are perfectly well aware of the issue with using Tfrs.br /blockquoteIn particular, one could speculate that tempo effects might be—at least partially—responsible for the observed change in the development–fertility association. For example, countries at development levels near the critical level HDIcrit = 0.86 might have a more rapid postponement of childbearing than more advanced countries. If this were the case, tempo effects would reduce the TFR more strongly at intermediate than at advanced HDI levels, and the positive association between HDI and TFR in Figures 1–2 could be partially explained by differences in the pace of fertility postponement, rather than by variation in levels among advanced countries./blockquotebr /br /The authors therefore carry out a robustness test which effectively amounts to a cross-sectional study (cross-sectional note, not longitudinal) of the relationship between the total fertility rate with and without adjustment for tempo effects, and the human development index in 1975 and 2005. Tempo adjusted TFRs are not available over the period in question so they simply took data for 2005 (for those countries for which it is available from the ’European Demographic Data Sheet 2008’ (published by the Vienna Institute of Demography, Vienna, Austria) and from McDonald P, Kippen R. The Intrinsic Total Fertility Rate: A New Approach to the Measurement of Fertility (Population Association of America Annual Meeting 2007, New York, 2007). What they can then show is that the HDI–TFR relationship at persists at advanced development stages persists even after adjusting the total fertility rate for tempo effects. But, as I say, this is cross sectional, not longitudional. What does this jargon mean? It means there is no clear causal relationship, since equally it could be better HDIs which is driving better fertility, and hence you can use the HDI to explain differences between countries if you wish, but not the evolution of fertility in individual countries. The 2005 result is show as a black line in the chart below, where you can see that as HDI goes up, Tfr also seems to be higher.br /br /a href="http://1.bp.blogspot.com/_ngczZkrw340/Sn1xBKpJlQI/AAAAAAAAOxE/GnOAvjVfEW4/s1600-h/cross+section.png"img style="TEXT-ALIGN: center; MARGIN: 0px auto 10px; WIDTH: 400px; DISPLAY: block; HEIGHT: 371px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5367570595746256130" border="0" alt="" src="http://1.bp.blogspot.com/_ngczZkrw340/Sn1xBKpJlQI/AAAAAAAAOxE/GnOAvjVfEW4/s400/cross+section.png" //abr /br /Which is very much to the point, and brings me to my second issue, since in my blog post "Taking Solow Seriously - Does Neoclassical Steady State Growth Really Exist?" (a href="http://edwardhughtoo.blogspot.com/2009/06/taking-solow-seriously-does.html"which you can find here/a) - I demonstrate using a few simple charts that the evolution in GDP per capita (which accounts remember for one third of the HDI) may well be a function of underlying population dynamics, since three countries with stronger population growth and higher fertility (the US, the UK and France) evidently perform much better than three will low-to-negative population growth and very low fertility (Italy, Japan and Germany).br /br /Also, it should be remembered, as I mention, we need to think about base years. 2005 was the mid point of a massive and unsustainable asset and construction boom. I think there is little doubt that if we took 2010 or 2011, the results would be rather different.br /br /Finally, the piece in the Economist article that I personallyfind most interesting is the following:br /br /"Dr Myrskyla’s data, however, suggest the ultimate outcome of development may not be a collapsing population at all but, rather, the environmentalist’s nirvana of uncoerced zero population growth."br /br /I want to stress, I certainly think this stationary population idea is certainly one possibility in the more highly developed nations - but if we move to stationary populations, with higher and higher proportions of the population in the older age groups the result is - as we know - a rising median population age. It is the economic impact of the abrupt rise in median age that I personally am focused on, and how just this rise, and the resulting fall in living standards for many young people, might feedback in a negative way on fertility and thus produce ever more rising median ages. In recent days, some have been asking why people like myself are so focused on what is going on in Latvia, which is after all, a pretty small country. Well, I think here in the issues raised by the Nature letter we have just one more reason why that country is important, since in a sense it is conducting a "live" experiment.br /br /Finally, I want to say, none of the above should be read as suggesting that there isn't a great deal of interest and material to talk about in the study the authors have carried out. Nor would I hold them entirely responsible for the way in which others have used and abused their work. I just the reserach doesn't demonstrate what they want it to demonstrate, and that the study doesn't deserve the kind of high media profile it has been receiving, since it is going to mislead the general public more than it will enlighten them, given the important methodological issue which are still to be clarified.br /br /The heart of the problem is twofold. The excessive reliance on a rather problematic indicator (the Tfr) and the causality issue when it comes to GDP per capita and higher fertility (which way does the arrow point?). In fairness the authors do attempt to construct their own combined time series based on a mixture of tempo-adjusted Tfrs and Tfrs, a procedure which seems at the very least to be somewhat problematic if you want to reverse fifty years of academic consensus. And they do get the same sort of result, but the outcome is much weaker and is based on a much smaller sample of only 25 countries. But even this result is at the very least odd, since, as I argue above, cohort fertility hasn't really increased in most of thecountries concerned. So I think we really all need to see more details of how the authors actually constructed the time series to be able to form a better judgement.br /br /But all this being said, and whatever the original intentions of the authors, serious scientific debate does seem to have been turned here into something of a media circus. Wasn't it blogs that were supposed to do that?br /br /strongAppendix/strongbr /br /Below I offer a series of charts showing estimated completed cohort fertility rates based on data compiled by Eurostat using the distribution of births by parity (first and second or higher order births) and mean age of mothers at respective parities to carry out the calculations. Evidently, the most recent data for hard data on completed cohort fertility comes for the 1960 - 1965 cohort. These charts should not be treated as hard data, but a rule-of-thumb type quick visual inspection suggests that it is hard to accept the case for a substantial fertility rebound in many European countries.br /br /a href="http://3.bp.blogspot.com/_ngczZkrw340/Sn3PO8BEe7I/AAAAAAAAOx8/9eOvojQ9XYQ/s1600-h/Switzerland+and+Slovenia.png"img style="TEXT-ALIGN: center; MARGIN: 0px auto 10px; WIDTH: 400px; DISPLAY: block; HEIGHT: 203px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5367674186431232946" border="0" alt="" src="http://3.bp.blogspot.com/_ngczZkrw340/Sn3PO8BEe7I/AAAAAAAAOx8/9eOvojQ9XYQ/s400/Switzerland+and+Slovenia.png" //abr /br /a href="http://4.bp.blogspot.com/_ngczZkrw340/Sn3PJ0CFCQI/AAAAAAAAOx0/yu_FnUR5KkM/s1600-h/norway+and+denmark.png"img style="TEXT-ALIGN: center; MARGIN: 0px auto 10px; WIDTH: 400px; DISPLAY: block; HEIGHT: 203px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5367674098388633858" border="0" alt="" src="http://4.bp.blogspot.com/_ngczZkrw340/Sn3PJ0CFCQI/AAAAAAAAOx0/yu_FnUR5KkM/s400/norway+and+denmark.png" //abr /br /a href="http://3.bp.blogspot.com/_ngczZkrw340/Sn3PGVm-g8I/AAAAAAAAOxs/1jEqYkUYjqE/s1600-h/netherlands+and+Italy.png"img style="TEXT-ALIGN: center; MARGIN: 0px auto 10px; WIDTH: 400px; DISPLAY: block; HEIGHT: 201px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5367674038682289090" border="0" alt="" src="http://3.bp.blogspot.com/_ngczZkrw340/Sn3PGVm-g8I/AAAAAAAAOxs/1jEqYkUYjqE/s400/netherlands+and+Italy.png" //abr /br /a href="http://1.bp.blogspot.com/_ngczZkrw340/Sn3PCbmMTYI/AAAAAAAAOxk/6BPfKQPDsIc/s1600-h/luxembourg+and+spain.png"img style="TEXT-ALIGN: center; MARGIN: 0px auto 10px; WIDTH: 400px; DISPLAY: block; HEIGHT: 203px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5367673971570134402" border="0" alt="" src="http://1.bp.blogspot.com/_ngczZkrw340/Sn3PCbmMTYI/AAAAAAAAOxk/6BPfKQPDsIc/s400/luxembourg+and+spain.png" //abr /br /a href="http://3.bp.blogspot.com/_ngczZkrw340/Sn3O-cYGe_I/AAAAAAAAOxc/ktZadAXfAaU/s1600-h/ireland+and+Greece.png"img style="TEXT-ALIGN: center; MARGIN: 0px auto 10px; WIDTH: 400px; DISPLAY: block; HEIGHT: 204px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5367673903059991538" border="0" alt="" src="http://3.bp.blogspot.com/_ngczZkrw340/Sn3O-cYGe_I/AAAAAAAAOxc/ktZadAXfAaU/s400/ireland+and+Greece.png" //abr /br /a href="http://4.bp.blogspot.com/_ngczZkrw340/Sn3O6b_brlI/AAAAAAAAOxU/eGWratutFCw/s1600-h/Iceland+and+Sweden.png"img style="TEXT-ALIGN: center; MARGIN: 0px auto 10px; WIDTH: 400px; DISPLAY: block; HEIGHT: 201px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5367673834237046354" border="0" alt="" src="http://4.bp.blogspot.com/_ngczZkrw340/Sn3O6b_brlI/AAAAAAAAOxU/eGWratutFCw/s400/Iceland+and+Sweden.png" //abr /br /a href="http://4.bp.blogspot.com/_ngczZkrw340/Sn3O2NEgbvI/AAAAAAAAOxM/sfcSNnQpjQc/s1600-h/finland+and+germany.png"img style="TEXT-ALIGN: center; MARGIN: 0px auto 10px; WIDTH: 400px; DISPLAY: block; HEIGHT: 202px; CURSOR: hand" id="BLOGGER_PHOTO_ID_5367673761512320754" border="0" alt="" src="http://4.bp.blogspot.com/_ngczZkrw340/Sn3O2NEgbvI/AAAAAAAAOxM/sfcSNnQpjQc/s400/finland+and+germany.png" //adiv class="blogger-post-footer"img width='1' height='1' src='https://blogger.googleusercontent.com/tracker/8991369883287712098-4815330640925891745?l=globaleconomydoesmatter.blogspot.com'//div

Switzerland sold 1550 tons of gold between 2000 and 2009, roughly 127.78 tons per year

Alex Stanczyk — Fri, 07 Aug 2009 17:31:32 +0000

Switzerland sold 1550 tons of gold between 2000 and 2009, roughly 127.78 tons per year according to this article. They also say that no further sales are planned for the foreseeable future. That is a whopping 127.78 tons per year LESS supply to the worlds demand. Is this bullish for gold? Original Article: http://www.20min.ch/finance/news/story/Schweiz-verkauft-kein-Gold-mehr-30046438 Translated from German to English via [...]div class="feedflare" a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=Ld0S4gUAYb8:Uav8N6Si-To:yIl2AUoC8zA"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?d=yIl2AUoC8zA" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=Ld0S4gUAYb8:Uav8N6Si-To:F7zBnMyn0Lo"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?i=Ld0S4gUAYb8:Uav8N6Si-To:F7zBnMyn0Lo" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=Ld0S4gUAYb8:Uav8N6Si-To:7Q72WNTAKBA"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?d=7Q72WNTAKBA" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=Ld0S4gUAYb8:Uav8N6Si-To:V_sGLiPBpWU"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?i=Ld0S4gUAYb8:Uav8N6Si-To:V_sGLiPBpWU" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=Ld0S4gUAYb8:Uav8N6Si-To:qj6IDK7rITs"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?d=qj6IDK7rITs" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=Ld0S4gUAYb8:Uav8N6Si-To:l6gmwiTKsz0"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?d=l6gmwiTKsz0" border="0"/img/a a href="http://feeds.feedburner.com/~ff/YourFinancialFuture?a=Ld0S4gUAYb8:Uav8N6Si-To:gIN9vFwOqvQ"img src="http://feeds.feedburner.com/~ff/YourFinancialFuture?i=Ld0S4gUAYb8:Uav8N6Si-To:gIN9vFwOqvQ" border="0"/img/a /div

PennyOmega.com Stock Report! 8/05/09, SAP, ADTN, PQ, XSEL, SFE, ACTG

PennyOmega.com — Wed, 05 Aug 2009 11:08:31 +0000

<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<<

U.S. Manufacturing Is Recovering…

Contrarian Profits — Tue, 04 Aug 2009 20:30:34 +0000

pA strong currency move Monday#8230; RBA leaves rates unchanged#8230;And moves bias to neutral#8230;Central Bank warnings have no teeth! And Now#8230; Today#8217;s Pfennig!/p pGood day#8230; And a Terrific Tuesday to you! First day back yesterday was a killer for yours truly#8230; Went home, and went to sleep#8230; But, I#8217;m back today, and feeling good. I did something to my left knee on vacation that left me hobbling, and leaning on my cane more than I usually do. But today, it seems a bit better, so I#8217;ve got that going for me!/p pYesterday, I left you with the euro popping back and forth over the 1.43 level#8230; But in a wink of an eye, the 1.43 level was gone, and the euro was trading#8230;/p

XO Holdings Inc. (XOHO.OB) Subsidiary Provides Secure Communications Capabilities through Domestic and International Partnerships

QualityStocks — Mon, 03 Aug 2009 20:26:00 +0000

XO Communications, a subsidiary of XO Holdings Inc., provides advanced communications services through its nationwide and metro networks and broadband wireless capabilities. The company today announced the expansion of its domestic and international MPLS network capabilities by securing domestic and international partner agreements. The communications company now provides coverage in all 50 states and 22 [...]

Gold, Silver Hit 7-week Highs on Weak Dollar

Contrarian Profits — Mon, 03 Aug 2009 17:45:39 +0000

pGold and silver prices climbed to their highest in seven weeks on Monday, as the dollar#8217;s slide to its lowest since mid-December boosted interest in hard assets./p pSpot gold hit an intra-day high of $961.00 an ounce, its highest since June 11, and was bid at $959.10 an ounce at 1329 GMT, against $953.90 an ounce late in New York on Friday./p pU.S. gold futures for August delivery on the COMEX division of the New York Mercantile Exchange rose $5.70 to $959.40 an ounce./p p#8220;At the moment we#8217;re seeing the dollar as the key factor to movements in the gold market,#8221; said Eugen Weinberg, senior analyst at Commerzbank./p p#8220;In the past few months (gold) has gone from being a safe haven to becoming a dollar play.#8230;/p

GSK’s (Plague) Ship Comes In

Adam Lass — Mon, 03 Aug 2009 15:23:11 +0000

One drugmaker has figured out how to pull down $2.52 billion over the next six months off a single disease – here’s how to get your piece of the action. It could easily have been a headline from the 19th century. “Plague Ship Docks at Marseille: The arrival of the Norwegian flagged “Voyager of the Seas” [...]

CEMEX: Neck-Deep in Trouble – Analyst Blog

Zacks Market Commentaries — Wed, 29 Jul 2009 15:40:38 +0000

On July 28, debt-laden Mexican cement maker CEMEX, S.A. de C.V. (CX) posted weak results for the second quarter of 2009. Net debt at the end of the second quarter was $18,272 million, representing an increase of $238 million during the quarter.

Consolidated net sales decreased to $4,188 million, representing a decrease of 34%, compared to the second quarter of 2008 due to lower volumes from U.S. and Spanish operations, which was partially mitigated by price inelasticity. EBITDA decreased 41% year over year to $812 million and EBITDA margin decreased by 220 basis points from 21.6% in the second quarter of 2008 to 19.4% at the end of June, 2009.

Operating income decreased to $411 million in the second quarter of 2009 from $899 million in the year-ago quarter. This decline was due to the increase in costs and expenses on lower volumes both in the U.S. and Spain. Thus, net income stood at $187 million, versus $444 million in the second quarter of 2008.

Currently, the cement industry is suffering based on the probability of new rules to limit emissions from the energy-intensive kilns that are core to the business, and more so CEMEX, which is battling with leading cement maker in U.S. like France's Lafarge SA (LAFP) and Switzerland's Holcim Ltd (HOLN) in a difficult market. Moreover, the company lost its profitable Venezuelan operations in 2008, and needs to repay $4.1 billion of debt by the end of 2009 and the remaining in 2010 and 2011.

CEMEX has huge exposure to the U.S., Spanish and British construction businesses; countries that are experiencing a difficult moment in its real estate cycle at present. In fact, prolonged downturns in the residential sector and tight credit conditions have negatively affected all segments of the construction sector around the world. The private sector is shrinking and the U.S. and European housing sectors are facing a huge crisis.

Meanwhile, almost all major governments in the world, including the U.S., European Union, China and Brazil, have been trying to stimulate infrastructure investment in the coming quarters. We believe it is still too early to tell when these programs will provide immense demand to fuel growth for the company and generate cash flow to reduce its huge debt and return to normal profitability. Thus, we are keeping our Sell recommendation on CEMEX.

Read the full analyst report on "CX"
Zacks Investment Research

Cartesio+ to Navigate STM – Analyst Blog

Zacks Market Commentaries — Tue, 28 Jul 2009 15:00:51 +0000

STMicroelectronics (STM) announced a new application processor with embedded GPS to be used as portable navigation systems in cars. It is named Cartesio+ and it combines superior processing power and positioning accuracy at a low cost.

Cartesio+ offers high integration and performance features and has high-sensitivity embedded positioning capabilities. It satisfies the highest automotive quality control parameters while consuming low power.

It is manufactured in ST’55 nanometer process technology and integrates a powerful processor with a GPS subsystem enhanced with indoor sensitivity. It integrates video input port for connecting auxiliary devices such as a rear-view camera for safe parking. The device also supports dynamic scaling of the core frequency to improve battery life.

The new Cartesio+ processor has been designed to meet demanding standards of quality and reliability in the automotive market. Cartesio+ is scalable and is available in two variants: the STA2064 and STA2065, which have been crafted for cost-sensitive and performance-demanding applications, respectively. Samples are now available to lead customers while commercial production is scheduled for December 2009.

Automotive, Consumer, Computer & Telecom Infrastructure (ACCI), which is making the Cartesio+ processor, is the largest segment of STM. This group is comprised of three major product lines; Home Entertainment & Displays (HED), which now includes the Imaging division; Automotive Products Group (APG); and Computer and Communication Infrastructure (CCI), which now includes the Communication Infrastructure division.

Based in Geneva, Switzerland, STMicroelectronics N.V. is a global independent semiconductor company. It designs, develops, manufactures and markets a broad range of semiconductor integrated circuits (ICs) and discrete devices. These devices are used in a wide variety of microelectronic applications, including telecommunication systems, computer systems, consumer products, automotive products, and industrial automation and control systems.

We maintain our Hold rating on STM.

Read the full analyst report on "STM"
Zacks Investment Research

Intersil Tops, Guidance Strong – Analyst Blog

Zacks Market Commentaries — Fri, 24 Jul 2009 11:48:18 +0000

Intersil Corporation (ISIL) reported second quarter results that beat the consensus revenue estimate by 22.3% and EPS estimate by 8 cents. The results were as expected, reflecting reduction in channel inventories (down 7%), as well as stronger end markets. Yesterday Linear Technology (LLTC) reported results that beat the consensus, as expected. We also expect peer companies Maxim Integrated Products (MXIM) and Semtech (SMTC) to beat the consensus.

Revenue of $147.3 million was up 24.6% sequentially and down 31.9% year over year. The sequential increase was attributable to recovery in the computing and consumer markets. Computing revenue was up 40.7% sequentially, driven by strength in notebooks, market share gains in netbooks and stability in desktops and servers. There was particular strength in single phase power management products for Intel’s atom processors. Consumer revenue was up 51.9% sequentially, driven by ambient light sensors, proximity sensors and display power products. The strength in notebooks, MIDs and UMPCs is likely to be constrained by panel shortage in the channel. Strength in Gaming should continue. Industrial revenue was up 2.9%, indicating a bottom in the global market. The company benefited from strength in new general purpose products. Communications revenue increased 1.7% sequentially, as the Chinese stimulus program drove pockets of strength in DSL.

The book to bill was well over 1, which increased the backlog. Customer lead times also started stretching out. As a result, required turns were down slightly.

Gross margin for the quarter was 54.7%, down 102 basis points (bps) from the previous quarter’s 55.7%. The gross margin decline was primarily on account of mix, as the growth in low-margin computing and consumer products was much stronger than the growth in high-margin industrial and communications markets. The negative impact was partially offset by employee-related cost reductions, transition to quarter micron manufacturing processes, migration from gold to copper wire bonding and a significantly higher utilization rate.

The operating expenses of $59.1 million were higher than the previous quarter’s $53.6 million. The operating margin was 14.5%, up 421 bps sequentially from 10.3%. The increase was related to benefits of cost reduction initiatives, which lowered SG&A as a percentage of sales by 422 bps, R&D by 211 bps and COGS by 98 bps.

The pro forma net income was $17.4 million, or 11.8% of sales compared to $10.8 million, or 9.1% in the previous quarter and $48.8 million, or 22.6% in the year-ago quarter. Including restructuring charges, stock based compensation, intangibles amortization, gain on deferred compensation investments and one-time tax expense related to the relocation of headquarters from Switzerland to Malaysia , the GAAP EPS was $0.05 compared to $0.02 in the previous quarter and $0.30 in the year-ago quarter. Excluding the special items, the pro forma EPS was $0.15.

The balance sheet is very strong and debt free. Inventory was down 4.9%, yielding inventory turns of 2.8x. DSOs decreased from 47 to 43 days. The cash balance increased $16 million to $324.2 million. Principal uses of cash were $1.3 million on capex and $15 million on dividend.

Guidance was strong. Revenue is expected to be $156-162 million (up 6-10% sequentially) and gross margin to increase slightly due to better mix, higher volumes and increased efficiencies. Interest income should be flat at $1.4 million and GAAP tax rate 17%, yielding GAAP EPS of $0.08-$0.11 based on a diluted share count of 122.2 million. One-time items include stock based compensation ($700K in COGS, $3.4 million in R&D and $3 million in SG&A) and intangibles amortization of around $3.2 million. Capex is expected to be $2-3 million in the third quarter. By end market—consumer to grow significantly (almost normal seasonality), industrial up modestly, and computing and communications up slightly.
Read the full analyst report on "ISIL"
Read the full analyst report on "LLTC"
Read the full analyst report on "MXIM"
Read the full analyst report on "SMTC"
Zacks Investment Research

McDonald’s Shifts Euro HQ – Analyst Blog

Zacks Market Commentaries — Mon, 13 Jul 2009 15:57:18 +0000

An announcement was made on July 11, 2009, that McDonald’s Corporation (MCD) will relocate its European headquarters from London to Geneva later this year to take benefit of preferential intellectual property tax laws.

The tax laws in Switzerland, particularly for intellectual property, have lured many foreign companies, particularly the regional European headquarters of US multinationals. Corporate tax rates can substantially be lower in Switzerland compared to the U.K. because of favorable Swiss tax laws.

However, the company notified that the move was undertaken to help the company manage its key international intellectual property rights effectively, including the licensing of those rights to its franchisees.

McDonald’s headquarters has been in London for a very long time. The company’s first outlet in the U.K. was opened in London in 1974. With this transition, the company joins Kraft Foods (KFT), Procter & Gamble (PG), Google (GOOG), Yahoo (YHOO) and Colgate Palmolive (CL), who have shifted operations to Switzerland to take advantage of the country's congenial tax regime.

The changes in the U.K. tax laws on taxation of foreign profits from intellectual property rights, such as patents and trademarks will require McDonald’s pay twice as much tax on foreign profits from intellectual property.

McDonald’s European operations have grown rapidly in recent years, compared to its core US division operations and is now the largest region by sales. McDonald’s now operates in more than 40 markets in Europe. Comparable sale for the month of May 2009 jumped 7.6% in Europe compared to a rise of 2.8% in the U.S.

McDonald’s Corporation operates in the Quick Service Segment, which has been resilient to the economic turmoil to some extent. With lower disposable income, the consumers are shifting base to Quick Service Restaurants from Upscale and Casual Dining segments because of their lower priced menu. McDonald’s in the Quick Service Segment competes with Krispy Kreme Doughnuts (KKD), Yum! Brands (YUM), Papa John's International (PZZA) and Chipotle Mexican Grill (CMG).

We maintain our Buy rating on the stock with a six-month price target of $59.00.

Read the full analyst report on "MCD"
Read the full analyst report on "KFT"
Read the full analyst report on "PG"
Read the full analyst report on "GOOG"
Read the full analyst report on "YHOO"
Read the full analyst report on "CL"
Read the full analyst report on "KKD"
Read the full analyst report on "YUM"
Read the full analyst report on "PZZA"
Read the full analyst report on "CMG"
Zacks Investment Research

Prieur’s readings (July 13, 2009)

Prieur du Plessis — Mon, 13 Jul 2009 07:43:37 +0000

This post provides links a number of interesting articles I have read over the past few days that you may also enjoy.

Rebecca Wilder: World economic updates (July 3–10) – finding some turning points

Prieur du Plessis — Sat, 11 Jul 2009 06:49:24 +0000

"... the turning points have yet to materialize in much of the US domestic reports. However, globally the first derivative action (actual monthly growth) is more obvious," said Rebecca Wilder in this guest contribution.

ETFS Amends U.S. Filing For Gold ETF

IndexUniverse Staff — Fri, 10 Jul 2009 22:44:22 +0000

As reported first on Bullion Desk, London-based commodities specialist ETF Securities has amended its filing with the Securities and Exchange Commission in order to launch a physically-backed gold tracker product with custody in Switzerland.

Earlier this year, as reported on IndexUniverse.com, ETF Securities made filings to the SEC to launch ETFs tracking gold, silver, platinum and palladium, called the ETFS Gold, Silver, Platinum and Palladium Trusts, respectively. The platinum and palladium funds will be the first of their type available in the US market.

On 2 July the ETFS Gold Trust filed with the SEC to issue up to US$1 billion in ETFS Physical Swiss Gold Shares. The custodian will be JP Morgan Chase Bank NA, who will, in turn, select a sub-custodian in Zurich to hold the trust’s allocated gold.

The existing physically-backed gold trackers run by ETF Securities in Europe, Gold Bullion Securities (LSE: GBS.L) and ETFS Physical Gold (LSE: PHAU.L), both have HSBC Bank USA as their custodian. HSBC was named as the custodian in the original US registration for the ETFS Gold Trust.

In recent months gold ETFs run by Swiss banks ZKB and Julius Baer have gained market share amongst bullion trackers, with many observers citing the location of the funds’ gold custody in Switzerland as a key selling point.

The ETFS Physical Swiss Gold shares will trade on NYSE ARCA under the symbol “SGOL”. The management fees to be levied on the shares have not yet been determined, a spokesman for ETF Securities said.

ETF Securities’ new filing comes at a time of intensifying competition in the gold tracker market. Last week Source, the London-based issuer of exchange-traded products, launched the Source Physical Gold ETC, whose management charge, at 0.29% per annum, undercuts competing products by at least 10 basis points.

The US-based SPDR Gold Trust (NYSEArca: GLD) remains the largest gold exchange-traded product in the world by some margin, with over US$33 billion under management.

And Then There’s This…Friday, July 10, 2009

Contrarian Profits — Fri, 10 Jul 2009 19:00:49 +0000

pFrom the close of trading in New York on Wednesday afternoon at 5:15 Eastern Time#8230;and the close of trading 24 hours later on Thursday at the same time#8230;the U.S. dollar lost about 90 basis points. That#8217;s a strongbig/strong drop. Gold#8217;s response? Up three bucks#8230;and silver was actually down on the day./p pYesterday#8217;s low tick on the U.S. dollar occurred around 2 p.m. in New York at 79.72 cents#8230;plus or minus a couple of ticks. Gold#8217;s peak price in the first few days of June was around $990#8230;when the dollar printed a low of about 78.70 cents. In five weeks, the U.S. dollar has gained a full cent [one percent and change], while the US$ gold price has been hit for 77 big#8230;/p

Paradise in Heidi’s country

Prieur du Plessis — Fri, 10 Jul 2009 08:07:58 +0000

This post shares a few paragraphs on my present whereabouts in Europe.

The Long Road to Ruin

Bill Bonner — Thu, 09 Jul 2009 15:00:20 +0000

pThe stock market seems to be rolling over. Investors read the news. It’s probablybr / becoming clear to them that the economy is not going back to normal any time soon./p pYesterday, the strongDow lost another 131 points/strong. Another big day down and it will be in thebr / 7,000-range. Oil sank too – down to $62. The dollar, bonds, and gold stayed about wherebr / they were./p pEconomists are still talking about an “exit strategy.” But in view of what is actually goingbr / on in the economy, they’ll probably want to stay on this highway a lot longer. This is thebr / long road to ruin, of course. It may be fatal, but it is not – yet – unpopular.br / Broadly, strongwhat is happening is exactly what should be happening/strong./p pThe stock market rally#8230;/p

And Then There’s This…Wednesday, July 8, 2009

Contrarian Profits — Wed, 08 Jul 2009 19:30:49 +0000

pGold didn#8217;t do a lot in Far East trading on Tuesday. The low of the day occurred at the open in London#8230;and for the next two hours, gold put on a spirited rally [$10+] that ended with the price going vertical about half an hour before the Comex open. However, as is always the case at moments like these, the usual not-for-profit sellers showed up and did their dirty until it was time for them to go for lunch at 12:00 noon in New York. Once #8216;da boyz#8217; were at lunch, gold made a $7 run higher, which ended the second that floor trading was over on the Comex#8230;and electronic trading began. /p pAnd by the time that gold trading was#8230;/p

Gold Steadies as Dollar Recovers, G8 Eyed

Contrarian Profits — Tue, 07 Jul 2009 21:30:43 +0000

pGold steadied today, Tuesday, erasing earlier gains, as the dollar recovered lost ground against a basket of currencies, reducing the precious metal#8217;s appeal as an alternative asset./p pTraders are awaiting fresh direction from the foreign exchange markets after a meeting of G8 leaders later this week./p pSpot gold was bid at $922.65 an ounce at 1544 GMT, against $924.00 an ounce late in New York on Monday, having earlier touched a high of $931.55./p pU.S. gold futures for August delivery on the COMEX division of the New York Mercantile Exchange eased $1.20 to $923.10 an ounce./p pWith physical demand sluggish despite a price dip, the gold market is largely being driven by currency moves, traders said./p pThe precious metal edged lower on Tuesday as the dollar recovered#8230;/p

And Then There’s This…Tuesday, July 7, 2009

Contrarian Profits — Tue, 07 Jul 2009 19:30:58 +0000

pFrom the first paragraph of my Saturday commentary#8230;#8221;I don#8217;t know what it is about that [one hour and change] stretch of time between the Sydney close and the London open#8230;but if there is going to be a down day#8230;it starts right there a large percentage of the time.#8221; Any questions? Actually, both gold and silver got sold off the moment that the New York bullion banks opened for business 6:00 p.m. on Sunday night#8230;which is very early Monday morning in Far East trading. Shortly before 3:00 p.m. in Hong Kong, gold had almost made it back to unchanged#8230;and silver was actually up a couple of cents when the hammer fell. The bottom for gold came very shortly after the London#8230;/p

Pity the Poor Rich

Bill Bonner — Mon, 06 Jul 2009 21:48:07 +0000

p class="byline"There is little financial news today; markets in America were closed for the 4th of July weekend. So, we begin our week with a quote from our favorite philosopher: Yu Faz. “The rich man’s heart breaks…just like the poor man’s. For all his money, he cannot buy another one.”/p div class="entry-content" pYu should know. He was exiled after he had a liaison amoureuse with one of Genghis’ concubines./p pPity poor Yu! strongPity the poor rich…!/strong Here at emThe a href="http://www.dailyreckoning.com" class="alinks_links"Daily Reckoning/a/em, as long-term emDR/em sufferers know, we always take the part of the underdog. We almost never saw a lost cause that we didn’t want to join. We admire die-hards…and we like the company of scalawags./p pSo, today, we take up the banner of one group that is all these things…a group that#8230;/p/div

Video-o-rama: Roller-coaster ride into the long weekend

Prieur du Plessis — Sat, 04 Jul 2009 06:04:08 +0000

The holiday-shortened week saw investors pondering the depth of the economic rabbit-hole. As investors vacillated, most financial markets were characterized by a roller-coaster ride. Friday's worse-than-expected jobs data left no doubt that the economy was in recession. The highlights of the discussions were captured on video and are included in this video-o-rama compilation.

Weatherford Weathering Downturn – Analyst Blog

Zacks Market Commentaries — Thu, 02 Jul 2009 16:45:41 +0000

Weatherford Weathers Downturn on International Strength

Weatherford International (WFT), which recently moved its corporation to Switzerland from Bermuda, is a leading manufacturer and provider of equipment and services used in drilling, completion and production of oil and natural gas wells. The company carries out its operations along four geographical segments: North America, Latin America, Europe/West Africa/CIS and Middle East/North Africa/Asia.

Weatherford's large North American presence has become a liability in the current environment of tentative natural gas prices. But the company has a growing international footprint, particularly in the Eastern Hemisphere. International markets accounted for a little over 50% of total revenue earned last year, a ratio that is expected to materially increase this year due to the current slowdown in North American activity levels.

The slowdown in international activity levels is expected to be much less pronounced (an approximately 10% drop is expected from the 2008 levels), which works to Weatherford's advantage given its heavy international expansion efforts over the last few years. In fact, the company expects that all of its growth in 2009 will come from the international markets with a combined double-digit growth rate. In particular, Weatherford remains well positioned in Mexico and Iraq, both of which are expected to be major oilfield service growth markets in the coming years.

Additionally, we believe that the company's North American presence -- which may be a drag over the next few quarters due to the region's weak fundamentals -- should nevertheless provide plenty of exposure to the region's eventual recovery. Therefore, in spite of the stock's impressive run up in the last three months (the stock price has soared almost 80% to the current level of $19.56), we believe that this oilfield service name still offers upside from current levels.

As such, our Buy recommendation remains unchanged with a 12-month target price of $30.

Read the full analyst report on "WFT"
Zacks Investment Research

And Then There’s This…Tuesday, June 30th, 2009

Contrarian Profits — Tue, 30 Jun 2009 19:33:01 +0000

pGold price action on Monday looked similar to Friday#8217;s. The bottom for gold in the Far East came shortly after 3:00 p.m. in Hong Kong#8230;rose until shortly after London opened, declined a couple of bucks#8230;but once the London a.m. gold fix was in [10:30 a.m. in London...5:30 a.m. in New York], gold rose to its high of the day shortly after 11:00 a.m. This high [once again over $940] lasted until 9:00 a.m. in New York, shortly after the Comex opened#8230;then it got taken down eight bucks to its low of the day at 10:00 a.m. in New York#8230;which just happens to be the London p.m. fix#8230;3:00 p.m. over there. /p pFrom that point it rose right into the Comex close#8230;and#8230;/p

Words from the (investment) wise for the week that was (June 22 – 28, 2009)

Prieur du Plessis — Sun, 28 Jun 2009 08:37:06 +0000

“Words from the Wise” this week comes to you in a shortened format as I do not have access to my normal research resources while on the road in Europe. Although very little commentary is provided, a full dose of excerpts from interesting news items and quotes from market commentators is included.

Does the Price of Gold Rise or Fall in a Deflation?

Adrian Ash — Fri, 26 Jun 2009 19:42:29 +0000

pDeflation and the price of Gold. Give yourself an extra point for spotting the trick question. It#8217;s already tripping up plenty of would-be answers. Because gold must fall during deflation, since it rose so much during the inflation of the 1970s – right?br / #8220;Gold Prices, in real inflation-adjusted terms, unsurprisingly tended to increase during inflationary times,#8221; nods one commentator, writing in London but posted at the emstrong#62;Business Times/em in Singapore. #8220;Its purchasing power tended to sag during depressions and deflation.#8221;/p pThe source for this claim? Besides syllogism (#8221;The #8217;70s gave us inflation and a gold bull market; ergo, the opposite must be bad for gold#8230;#8221;) it was apparently Roy Jastram#8217;s emThe Golden Constant/em, that dry, dusty study of gold#8217;s enduring stability across the#8230;/p

Gone A.W.O.L – to Slovenia and Switzerland

Prieur du Plessis — Fri, 26 Jun 2009 08:31:57 +0000

I will find myself in Slovenia and Switzerland over the next two weeks, taking a break and soaking up some Northern Hemisphere sun. Blog posting will be slow while I am on the road and the normal service will be resumed on my return to Cape Town on July 11. (Click through to post to learn more about Slovenia.)

Slicing & Dicing On Steriods?

IndexUniverse Staff — Fri, 26 Jun 2009 08:00:00 +0000

Of course they're more volatile. But can emerging markets sector ETFs offer diversification tools to cut overlap and limit overall portfolio risks?

Bob Holderith is chief executive of Emerging Global Advisors. Richard Kang is chief investment officer for the New York-based company, which recently launched the first exchange-traded funds focused on specific sectors in emerging markets. (See related story here.)

EGA is expected to launch soon a third ETF that will act as a composite of the 10 underlying sectors in the Dow Jones emerging markets indexing series it’s using for current and upcoming funds.

The company says that nine more are in the works focusing on emerging markets sectors. Those will join the May launches of the EGS Emerging Markets Energy Fund (NYSE Arca: EEO) and the EGS Emerging Markets Metals & Mining Fund (NYSE Arca: EMT).

IndexUniverse.com’s Murray Coleman caught up with Holderith and Kang late Thursday to discuss the future of sector investing in developing markets.

IU: What is available for U.S.-based investors in terms of foreign sector ETFs now?

Holderith: The family of Select Sector SPDRs is the dominant ETF line providing sector-based exposures. They’ve got a long history. But those ETFs only focus on U.S. companies. For pure international exposure to foreign sectors, we’ve only seen two- to three- years worth of actual performance history. And that’s through the iShares’ global sector family of funds as well as those of State Street Global Advisors. The SSgA family is purely international sector ETFs.

IU: Then your firm’s line-up of international sector ETFs will compete most directly against those of SSgA?

Kang: No, since the SSgA ETFs are focused predominately on developed markets. For example, take the SPDR S&P International Financial Sector (NYSE: IPF). The top weighted countries are (in order): Japan, Canada, Australia, the U.K., Spain and Switzerland. The SSgA international sector ETFs do allow for some emerging markets exposure. But as cap-weighted indexes, they’re heavily skewed to developed countries.

IU: Why is your company going with pure emerging markets exposure rather than a mix of developed and emerging markets?

Holderith: There’s more than enough coverage of developed international markets now in the ETF marketplace. In terms of emerging markets, we’ve seen broad, regional and country specific funds. But we’re first to market with sector-specific ETFs for developing countries. The EMT and EEO ETFs are the first of a series we’re preparing to launch.

IU: What others are planned?

Holderith: We’ve got in the pipeline 10 ETFs still left to bring-to-market. Those will all use Dow Jones indexes, similar to those used by EMT and EEO. Dow Jones uses a classification system for sectors called the ICB (or industry classification benchmark) system. The other sector-specific ETFs in various stages of planning we’re working on launching cover: basic materials; consumer goods; consumer services; financials; health care; industrials; technology; telecom and utilities.

IU: You’ve also got a broader ETF that has received regulatory approval, don’t you?

Holderith: Yes, we’ve got a composite ETF that’s due to launch within the next few weeks. That’s an ETF tracking a Dow Jones index that takes the top 10 names from each of the 10 major emerging markets sectors. (It won’t include metals and mining, which is a subsector of basic materials.) So that will leave 100 names in the underlying composite index. And as in all of our ETFs, we have a rule that caps individual weightings at no more than 10%.

IU: In the composite index for such an emerging markets fund, what would the sector weightings look like then?

Holderith: Oil and gas along with financials are the dominant sectors in the composite index.

IU: What type of performance have you seen through back-tested data for emerging markets sector indexes compared to developed markets sector indexes?

Kang: We have data going back many years for the underlying benchmarks. The data for emerging markets, however, isn’t as robust as that for developed markets. So we really focus on data going back to December 2005 when comparing the Dow Jones composite benchmark we’re using for our emerging markets sector funds.

IU: What do those comparisons show?

Kang: Going back to 2005, returns were generally spectacular up through 2007 for emerging markets vs. developed markets. In the latter half of 2008, we saw greater volatility and bigger losses in emerging markets. As with any more volatile asset class, emerging markets offers the potential for greater long-term gains as a result. Clearly, some sectors performed better in relative terms during the periods when markets were going up versus others. The same is true in the bear market of 2008. That is the essence of the popularity of sector funds -- their selection during different stages of the market cycle.

IU: How correlated are emerging markets sectors to developed markets sectors?

Kang: That’s a tricky question. It depends on your timeframe. In statistical terms, there’s just not a lot of data. But you can draw some general conclusions. There are times, like in the bull market from 2005-2007, when many sectors in emerging markets and developed markets were highly correlated. Commodity stocks were highly correlated during the commodities boon regardless of location. On the other hand during the credit crisis, financials haven’t been as highly correlated because banks in the U.K, for example, have been exposed to more toxic assets than banks in places like China, Brazil and India.

IU: What do you see as the biggest benefits of breaking emerging markets into sectors?

Kang: A lot of investors managing their emerging markets exposures are doing so by allocating between countries. The question we asked at the very beginning of creating our ETFs is how much overlap there is between sectors and geography.

Let’s say you’re an American investor with heavy exposure to the S&P 500 index. Maybe you’ve tilted your portfolio a little to commodities through funds such as the SPDR Gold Shares (NYSE: GLD) and the iPath Dow Jones-AIG Commodity Index ETN (NYSE: DJP). If you’ve got that portfolio, you look more like a Canadian or an Aussie – both of those countries are heavily influenced by movements in natural resources prices.

IU: In other words, broader-based ETFs don’t add a lot in those situations?

Kang: The inclusion of broad emerging market ETFs as well as many of the country specific ETFs to this kind of portfolio would not provide diversification as correlations would be surprisingly high. For true diversification, the inclusion of certain sectors would likely provide more optimal risk-return characteristics to the overall portfolio.

Furthermore, many investors who invest in emerging markets country ETFs do so based on a sector-type of rationale. For example, let’s say someone wants to invest in Russia. The question I would ask is: Do you want to invest in that country to be more richly compensated with some sort of political risk associated with that country? Or, are you investing in Russia to make an oil and gas bet? If that’s the case, do you want to put all your eggs in one basket – Russia. Or, would you prefer to invest in a basket focused on oil and gas but with companies from Russia, India, China, Brazil and several others?

IU: Those are the top countries in EEO, aren’t they?

Kang: Yes. Those four countries comprise roughly two-thirds of the fund. And with EMT, the top countries are: South Africa, Brazil, China and Russia. Those take up more than three-quarters of the fund.

Breaking Emerging Markets Into Sectors

IndexUniverse Staff — Fri, 26 Jun 2009 08:00:00 +0000

Of course they're more volatile than rival iShares and SPDRs. But international sector ETFs focused on developing markets can help diversify portfolios, say firm's managers.

EGA is expected to launch soon a third ETF that will act as a composite of the 10 underlying sectors in the Dow Jones emerging markets indexing series it’s using for current and upcoming funds.

IndexUniverse.com’s Murray Coleman caught up with Holderith and Kang late Thursday to discuss the future of sector investing in developing markets.

IU: What is available for U.S.-based investors in terms of foreign sector ETFs now?

IU: Then your firm’s line-up of international sector ETFs will compete most directly against those of SSgA?

IU: Why is your company going with pure emerging markets exposure rather than a mix of developed and emerging markets?

IU: What others are planned?

IU: You’ve also got a broader ETF that has received regulatory approval, don’t you?

IU: In the composite index for such an emerging markets fund, what would the sector weightings look like then?

Holderith: Oil and gas along with financials are the dominant sectors in the composite index.

IU: What type of performance have you seen through back-tested data for emerging markets sector indexes compared to developed markets sector indexes?

IU: What do those comparisons show?

IU: How correlated are emerging markets sectors to developed markets sectors?

IU: What do you see as the biggest benefits of breaking emerging markets into sectors?

IU: In other words, broader-based ETFs don’t add a lot in those situations?

IU: Those are the top countries in EEO, aren’t they?

Slicing-And-Dicing On Steriods?

IndexUniverse Staff — Fri, 26 Jun 2009 08:00:00 +0000

Of course they're more volatile. But can emerging markets sector ETFs reduce exposure overlaps and limit overall portfolio risks?

EGA is expected to launch soon a third ETF that will act as a composite of the 10 underlying sectors in the Dow Jones emerging markets indexing series it’s using for current and upcoming funds.

IndexUniverse.com’s Murray Coleman caught up with Holderith and Kang late Thursday to discuss the future of sector investing in developing markets.

IU: What is available for U.S.-based investors in terms of foreign sector ETFs now?

IU: Then your firm’s line-up of international sector ETFs will compete most directly against those of SSgA?

IU: Why is your company going with pure emerging markets exposure rather than a mix of developed and emerging markets?

IU: What others are planned?

IU: You’ve also got a broader ETF that has received regulatory approval, don’t you?

IU: In the composite index for such an emerging markets fund, what would the sector weightings look like then?

Holderith: Oil and gas along with financials are the dominant sectors in the composite index.

IU: What type of performance have you seen through back-tested data for emerging markets sector indexes compared to developed markets sector indexes?

IU: What do those comparisons show?

IU: How correlated are emerging markets sectors to developed markets sectors?

IU: What do you see as the biggest benefits of breaking emerging markets into sectors?

IU: In other words, broader-based ETFs don’t add a lot in those situations?

IU: Those are the top countries in EEO, aren’t they?

Cement Industry Faces Bleak Future – Analyst Blog

Zacks Market Commentaries — Thu, 25 Jun 2009 16:21:25 +0000

The state of Texas recently filed a lawsuit against Cemex (CX) for $558 million in royalty payments the Mexican cement maker owed in the United States. Texas Land Commissioner Jerry Patterson alleged that the company had been mining a quarry near El Paso without paying royalties to the state's Permanent School Fund that owns the site. CX defended itself by saying that raw materials like aggregates, limestone and other rocks were not subject to royalties.

Although the suit is not legally correct and lacks merit, it is a matter of concern for the debt-ridden company. Cemex had drawn big short-term loans to buy Australia's Rinker in 2007 just before the U.S. housing crisis and the subsequent global financial disaster. It needs to repay $4.1 billion of debt by the end of the year and the remaining amount in 2010 and 2011. It is refinancing $14.5 billion in debt to stay afloat.

Currently, the whole industry faces a bleak future. Cemex, which competes with France's Lafarge and Switzerland's Holcim, is in a particularly vulnerable position after losing its profitable Venezuelan operations when socialist President Hugo Chavez ordered the nationalization of its assets in 2008.

The cement industry in U.S. on the whole is in a perilous state. Advocates of the cement industry in the country and environmentalists are facing off in hearings this week as federal regulators call for comment on new rules to limit mercury emissions from energy-intensive kilns that form core of the cement business. If approved, the restrictions would be effective from 2013.

The Portland Cement Association contends that the regulations proposed by the Environmental Protection Agency (EPA) would weaken the industry as operating costs would rise by $340 million and lead to a 10% reduction in domestic production.

The U.S. cement industry as well as many overseas firms such as Holcim, Lafarge, Germany's Heidelberg Cement, Italcementi, Cemex and Japan's Taiheiyo Cement, which own 80% of U.S. cement plants, will have to face the consequences.

Read the full analyst report on "CX"
Zacks Investment Research

NeurogesX Partners Qutenza – Analyst Blog

Zacks Market Commentaries — Mon, 22 Jun 2009 18:05:50 +0000

On June 22, 2009, NeurogesX (NGSX) announced that it has entered into a development and commercialization partnership for Qutenza, the company's cutaneous patch for neuropathic pain, with Astellas Pharmaceuticals. NeurogesX has licensed for commercialization Qutenza in all 27 EU member states, plus Iceland, Norway, Liechtenstein and Switzerland, along with the Middle East and Africa.

Astellas has also agreed to fund the required additional studies as requested by the European Commission, which include a long-term safety program in on-label indications. In return, Astellas has agreed to pay NeurogesX an upfront payment for Qutenza of e30 million ($42 million).

We expect that NeurogesX will recognize this payment over the life of the agreement. Astellas has also purchased an option to co-develop NGX-1998, the company's liquid formulation, for e5 million ($7 million). In addition to these upfront payments, Astellas has also committed e70 million ($97 million) in development and sales related milestones for Qutenza and NGX-1998.

NeurogesX will be entitled to a mid-teen to mid-20s percent scaling royalty on sales of the product. NeurogesX will continue to supply Qutenza to Astellas at a fixed transfer price. Astellas plan to be ready to launch the product during the first half of 2010.

We view the deal as a major positive for NeurogesX. The $49 million in cash provides a significant runway for management to push forward with commercialization plans in the U.S.

On the recent conference call, management noted that the 20-person bridging study requested by the U.S. FDA testing a 2.5% lidocaine + 2.5% prilocaine pre-application cream has completed and the company plans to being analyzing the data shortly. This data will be submitted to the FDA in July or August 2009. We expect that the FDA will push back the U.S. PDUFA action date from August 16, 2009 to October / November 2009. If approved, NeurogesX should be in position to launch the product during the first half of 2010.

The $49 million upfront payment from Astellas will help management fund the creation of a specialty sales force to promote the product. We view the current cash balance, which should stand between approximately $60 and $65 million at the end of the second quarter 2009, is sufficient to fund operations to cash flow positive by 2011.
Read the full analyst report on "NGSX"
Zacks Investment Research

UBS sells BPO and KPO units

Outsourcing Insider — Fri, 19 Jun 2009 12:57:07 +0000

Switzerland-based financial services provider UBS (NYSE: UBS) is reportedly selling its business process outsourcing (BPO) and knowledge process outsourcing (KPO) units. And is said to be in talks with Indian offshoring giants Infosys Technologies Limited (NASDAQ: INFY) and Wipro Limited (NYSE: WIT). The UBS Indian Service Center and UBS Krakow centre has an estimated value [...]

How the Bearer Bonds Saga Could Bring Down the US

Contrarian Profits — Thu, 18 Jun 2009 19:32:52 +0000

pToday’s emstrongNotes/strong/emstrong /strongreads more like a John le Carre novel than an investment newsletter. But bear with us. It tracks one of the most fascinating news stories you’ve never heard of. The news reports are maddeningly sketchy. And the mainstream media is doing a damn good job of not reporting the story./p pBut it’s clear the arrests by Italian authorities of two “Japanese-looking” men allegedly attempting to smuggle $134.5 billion worth of US bearer bonds across the Swiss border is the biggest financial crime in history. And one with major implications for America’s economic security./p pFor those of you who don’t know, a report surfaced on Monday, June 8, on an obscure Vatican-sponsored news website, AsiaNews.it, that Italy’s financial police (Guardia Italiana di Finanza)#8230;/p

And Then There’s This…Thursday, June 18th, 2009

Contrarian Profits — Thu, 18 Jun 2009 19:11:26 +0000

pThe low in Far East trading on Monday occurred shortly after the Hong Kong open#8230;and lasted until precisely 4:00 p.m#8230;.which was 3:00 a.m. in New York. From there, gold got sold off about $10 in London trading. The low price of the day occurred less than 15 minutes before the Comex open. The rally that began from that point lasted through the entire N.Y. trading session#8230;both Comex and electronic#8230;with gold tacking on about $12 and almost closing on its high of the day. It was a pretty quiet trading session, and there wasn#8217;t a lot of volume/p pAll of the above applied to silver as well./p pOpen interest changes for Tuesday showed that gold#8217;s o.i. fell another 2,588 contracts to 371,997#8230;on smallish#8230;/p

Nothing Fails Like Success

Bill Bonner — Wed, 17 Jun 2009 20:14:57 +0000

pWith the Rally Nearly Over the Germans are Buying Gold./p pThe Dow fell another 107 points yesterday. Oil held steady at $70. The dollar fell to $1.38. And gold rose $4 to 932./p pWhat if the rally is over? Could be#8230; It began on 9 March. That makes it more than 3 months old. Most likely, it will continue through the summer. But who knows?/p pThe important thing to remember is this: there can be no major, sustained bull market without one of two things happening./p pEither#8230; the mistakes of the Bubble Epoque must be cleared away#8230; allowing for a new era of genuine growth and real prosperity. At best, this would take a few years to achieve. Just imagine how long it will#8230;/p