Wealth Itself » Stock Market

Clean Energy Jobs, Tax Credits & Investing

andum — Mon, 11 Jan 2010 01:28:45 +0000

The US Map above graphically illustrates the 43 states whose companies received tax credits to support clean energy projects . If you are an investor, consider researching some of the companies that received the grants in order to see if these grants could materially benefit these companies and thus the share price. I looked at a few companies on the list (see the bottom of this page for an excel spreadsheet) and found that each one of the company’s share price increased after the announcement.

Wall St. Bank Stock Recommendations

andum — Tue, 27 Oct 2009 19:23:01 +0000

Are you thinking about investing in the major US banks? Zero Hedge put together the above graphic to show the cozy relationship between the major US banks. Each of the green arrows shows one bank recommending the stock of another bank. Most of the red arrows come from an analyst at a European bank. Go to Zero Hedge to read the post and see the graphic in more detail. What I want to know is how much of each of these bank’s assets include stock in the banks that they are recommending. I also want to know if they were buyers or sellers after their recommendations came out. Buying stock solely on the basis of a recommendation is a loser’s strategy. You should have a basis for the investment (fundamental and/or technical) that you understand and a target price or plan to sell. This is not a time to buy and hold. Stock downgrades typically come out too late and/or after the institutional stock owners have sold.

10 Year Treasury Note Predicting Stock Market Drop?

andum — Mon, 31 Aug 2009 01:30:31 +0000

Andy Dufresne at Zero Hedge just posted the above chart from StockCharts.com of the 10 Year Treasury Note and S&P index (see his post here). Please note on the chart how the 10 Year (in red) peaks before the market peaks and bottoms before the market bottoms, with a lag of 3 to 4 months. If the 10 Year is now rolling over and the same correlation holds true as the chart shows, the market should bottom in the Fall. The good news is that mortgage rates will drop, since rates are tied to the 10 Year Note.

April 2009 US Government Receipts – Free Falling

andum — Wed, 13 May 2009 04:13:33 +0000

Last October I pulled some retirement funds out of the market and moved them into a money market fund. I couldn’t bear to watch the shrinking balance, especially when the economic news seemed so dire. I decided I would rather preserve the reduced balance rather than take a chance that there was more pain to follow (there was). Since then I decided to spend more time reading about the economy, both optimistic and pessimistic viewpoints. My opinion, based on this reading, continues towards believing that there is more bad news looming for the economy – even in the presence of the ongoing stock market rally. It is difficult to think differently based on the new release of the US Treasury Monthly Statement (see document here ). Receipts for April 2009 – the month that typically results in the largest inflow of the year – was 34% less than April 2008 (see Table below). Receipts for what should be the best income month of the year for the US government were less than government outlays (as has every month since September 2008). This number suggests that the deficit estimates are probably optimistic (even after the upward revision this week), that the dollar will weaken and that the threat of inflation will start to play an even more prominent role in investor psyche. (credit to The Automatic Earth / Alea)

S&P Chart – Bear Rally or New Bull Market (April 2, 2009)?

andum — Thu, 02 Apr 2009 22:28:33 +0000

Chart from dshort.com - Click on chart for full size

I have posted a chart from dshort.com that contains the plots of the S&P averages during the last four major bear markets. While the stock market seems to be roaring ahead now, it is wise to remember that bear markets do not go straight down – even the crash of 1929 had bear market rallies. Also, the chart points out that we are 18 months into this recession – it took 30.5 months to reach the bottom of the tech market crash that started in 2000. Sometimes wealth preservation is the better option than wealth creation.