Too Old to make Resolutions that at an age nature will eventually cure I thought I’d share some wisdom from Al Lewis, Commentator at MarketWatch, a part of Dow Jones.
Not this Al Lewis.
This Al Lewis.
- Al writes that if Uncle Sam was seriously interested in self-improvement he would resolve the following: Stop deficit spending before $15 trillion becomes $20 trillion.
- Fix Social Security & Medicare before the Baby Boomers all retire over the next 5 years.
- Address shortfalls in public and private pensions before the Boomers start pulling their money out.
- End Mortgage Foreclosure.
- Stop the unemployment crisis and sending jobs overseas.
- Admit the economy will never come back to normal.
- Prosecute financial criminals.
- Figure out what derivatives are.
- Stop corruption in Washington.
- Quit pretending there will never be inflation while printing unprecedented amounts of money.
- Do Something. Those are a few of Al’s thoughts as I edited them to fit the space.
Year-end 2011:
- DJIA +5.5
- S&P 500 0
- Stoxx 600 –1.34
- Euro –3.32
- 10 Year-Treasury –1.44
Bank of America- Market Cap Lost $80 Billion in 2011. Analysts say problems persist and Barrons remind us that the bank’s growth strategy is not very clear.
Food Prices Rising! The price of pork, beef and other foods up 68% in the last five years. Prices fell in November but don’t get used to it says Dorothy Hinchcliff who reports the U.S. isn’t the only place with higher food costs. Include India where veggies were up 22%, Ag play here with potash manufacturers clearly in the sights of traders for 2012.
Soros sees bear market for Gold. George Soros two years back cut his holdings calling gold a bubble. And he’s Baaaack! But, other than Soros the median analyst community suggest the metal could rally as much as 39% in 2012. Remember George got out of the business of investing for other people some time back. More on Gold ETF trade a little further on…
Amazon the amazing on-line retailer that customers, including me, are absolutely hooked on, has had its stock 
price pummeled in the final quarter, even though the business is up 15%. Goldman Sachs analyst Heather Bellini reiterated her neutral rating on the company. But Gene Munster, managing director at Piper Jaffray, sets Amazon’s price at $256. Steve Grasso said on CNBC that the new Amazon Kindle Fire will be an iPad killer. I bought three as gifts and my only complaint is that you can only charge it using an outlet and not by computer or other means. Both analysts were bullish on Apple and Amazon for 2012.
Smart Money Magazine Where to Invest in 2o12? Look to Emerging Markets as living standards rise in those countries and people want to eat better (hint- fertilizers ). Also cherry pick Europe-especially Germany where several companies shine: Siemans, SAP. Also, Internet advertisers as Google and Baidu. I am always hesitant about magazine recommendations.
Waddisay? China’s Purchasing Manager’s Index rose to 50.3 in December illustrating that market concerns over a slowdown in the world’s second largest economy has been overblown. The index moved up from 49.0 in November as China’s economy will not be seeing a big slide. A reading above 50 shows expansion while under 50 an economic contraction.
The Great Recession That Keeps Hanging On….State Street Global Advisors George Hoguet favors emerging markets over developed countries. In a 
Barrons interview he said the world is only half way through the recession. He went on to say it’ll take the UK banks until 2016 to get back to 2008 production. That’s a full lost eight years. It will be very difficult for the United States to decouple from a European recession. He concluded that his firm is overweight emerging markets. He said that in five or ten years emerging markets should be the core in everybody’s portfolios. The euro, he thinks, will weaken some more in 2012. The countries he finds most attractive include Brazil, Turkey and Indonesia. He also like South Korea and does not see an acceleration of tensions with the North. India, however, he is seriously underweighted because of inflation.
Dynamic Duo buying stocks that offer both growth 
and yield. Henry H. McVey of KKR’s Global and Macro Asset Allocation has compiled a list of those that are promising. Many are the same stocks that are seen on other screens by other managers. The usual suspects include:
- Lockheed Martin
- Philip Morris
- Conoco Safeway
- Time Warner
- Wal-Mart
There are about 20 other stocks Henry likes and I’ll keep tab on them as the year goes on. There are several mutual funds I like that fit this category.
Gold ETF may be a trade but not a long-term buy: Thomas H. Kee, Jr, technical analyst, writes that he doesn’t trust gold because there is no direct catalysts to influence price. (I’ve always thought of gold as an inflation trade.) But Mr, Kee says the technical's show that the gold etf GLD may be a buy at $141 and may head back to $161.
Autos Are Liked in Detroit Susan Tompor writes 
that local crystal ball gazers like Ford to $15.00 and GM to $34.00. Morningstar likes the autos but they like them a lot more with Ford $23.00 and GM $48.00.
Finally – It’s Election Year! Mark Hulbert writes that expectations are always greater in an election year and January seems to be the catalyst to get things going- a lot for the forthcoming year. But this January, Hulbert reports, is the 4th month of the 4th year charting from a Presidential Election Cycle from 1896 to the present. In that case this January historically produces a small loss. And, in a side bar – 
Portfolio Manager Michael Cuggino says that in 2012 investors will boost prices of gold, copper and other commodities.
Questions call Paul @ 877 783 7080 or write him at pstanley@westminsterfinancial.com. Share this blog with someone who cares about their money.
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