Don’t Like the Weather on Wall Street? Wait it minute. It’ll change.
General Stock Market Performance
Monday, 4.11.2008 Gains since 1.2.08
Dow: 12,325.42 -6%
Nasdaq: 2,290.24 -12%
S&P: 1,332.83 -8%
Market Commentary
Overall, the weather forecast for 2008 is weakness and volatility, at least through June. The markets have been performing true to those expectations, thus, the only money being made are those day-traders who buy low and sell high, in very short windows, and those options traders who are buying and selling put options (bets that the share price goes down) in very short windows.
The markets lost money between January and April. However, anyone who bought at the low in mid-January and sold at the high in February made money, as did anyone who bought at the low in early March and sold at the high on April Fool’s Day. Puts (options betting that the share price will go down) were the easy money, however. (See our Cooling Off list for companies expected to go down in value.)
On the other hand, the stock market gains over the last 39 years have been steady and reliable – performing well above real estate, gold and bonds. During those 39 years, there have been plenty of tough times, including 2000-2002, Black Monday 1987, 9.11 and more, and still the overall return is above 10% for stocks. That means that on average, over the course of 20+ years, odds are good that you’ll still make $100 for every $1000 invested, even if your portfolio is slightly down or limping along in 2007-2008.
Investment Portfolio: Average Annual Gains 1968-2007
Small Cap Stocks 12.22%
Large Cap Stocks 10.52%
Corporate Bonds 8.47%
Gold 7.97%
Real Estate 6.4%
Source: Morningstar and Realtor.org © 2008
So, if you’re a nervous Nellie, turn off the tv, keep tithing to your Buy My Own Island Plan, make sure that you’ve got a percent equal to your age safe in bonds, Treasury Bills or the money markets and take a long term view. That perspective pays off over time, as you can see in the above chart.
If you are someone who is willing to work a little harder for gains, then the trick is buying great companies (especially those with a wide range in their 52-week low and high) when they are trading for a song and taking your profits early and often (which can be a few hours or a few days). If you’d like to learn my trading strategies, which have proven to beat the market in up and down cycles, be sure to sign up for the Get Rich and Green Retreat, which will be in Santa Monica, California, May 14-16, 2008. Call 866.476.7442 NOW, as only a handful of seats are available, or email Heather@NataliePace.com. You can find out more about this retreat at the Get Rich and Healthy banner ad on the home page.
To learn "Trading Tips for Turbulent Times" and how to "Recession-Proof Your Portfolio," read the articles of the same names from the February 1, 2008 ezine, which is archived at NataliePace.com in the online magazines section.
Market Movers:
The Bureau of Economic Analysis released its final report on the 4th quarter GDP growth on March 27th. The numbers came in at .6% -- a screeching halt from the robust 4.9% GDP growth in the 3rd quarter of 2007. The next GDP growth report – advance estimates for the 1st quarter 2008 GDP growth – will be released on April 30, 2008. This is a report that will be widely watched by institutional investors, so expect April 30th to be another wild ride in the markets – up if the numbers are more robust than anticipated (not expected), down, if the numbers are as anemic as the 4th quarter of 2007 was.
The market’s wild mood swings are almost directly correlated with headlines – up when Federal Reserve Board Chairman Ben Bernanke saves the day with another interest rate cut, crashing down whenever the reality of the depth and breadth of the real estate crunch hurts another fundamental measurement (like GDP growth). In short, I wouldn’t expect great news on April 30th. However, remember that if you’re capitalizing on the volatility in the markets, bad news one day usually means a rate cut the next day (and yet another rally). This month, the Federal Open Market Committee’s 2-day meeting begins the day before the GDP numbers are released, on April 29th, so be careful getting too gleeful about a Fed rate cut if they choose to take preemptive action on the GDP growth numbers.
Anticipate that April 30th could feature a different headline about the economy’s dangerous descent into negative growth (and a recession), unless a miracle happens and the economy performed better in the first quarter of 2008 than it appeared to have. (You’ll notice that I’ve taken most of our profits on the Hot News list anticipating a tough market towards the end of the month.)
For more BEA release dates, go to the BEA.gov website and be sure to visit the NataliePace.com calendar section often.
The Federal Open Market Committee and Monetary Policy
The Federal Open Market Committee has dropped the Fed Fund Rate each of the last five sessions. The Fed funds rate currently stands at two and one-quarter percent. Expect the Federal Reserve Open Market Committee to continue to ease investor worries, while monitoring inflation. The prevailing sentiment is still weak growth, a continued housing slump, more subprime foreclosures, a weak dollar, anemic consumer spending, turmoil in banks and financial services and rising unemployment.
Volatility prevails. In your nest egg, take a long term view and make sure that your assets are properly allocated. Keep a percentage equal to your age + 10-20% safe, i.e. not invested in the stock market (which means NOT invested in mutual funds, ETFs or bond funds). Safer investments include bonds, Treasury Bills, money markets, certificates of deposits, etc. FYI: Modern portfolio theory recommends that you always keep a percent equal to your age safe. Adding 10-20% is called overweighting into the safe categories, which is a good idea in turbulent, down-trending markets.
If Dr. Marc Miles, global strategist, is correct in his forecasts, the bottom of the market might occur between May and July of 2008. For more of Dr. Miles’ observations, be sure to read the transcript of his online chat in the March 2008 NataliePace.com ezine.
EDUCATIONAL OPPORTUNITES AND INFORMATION:
1. FOMC Information: Interested in reading the minutes of the March 18, 2008 FOMC meeting for yourself? You can. The official Federal Reserve document is available online. Click on FOMC, or go to FederalReserve.gov, to read! According to the minutes, "Further declines in house prices led to a noticeable decrease in the ratio of household wealth to disposable income in the fourth quarter. The downturn in equity prices since December further reduced household wealth in the first quarter."
The tentative FOMC meeting schedule for the 2008 calendar is: April 29-30, 2008 (Tuesday-Wednesday), June 24-25, 2008 (Tuesday-Wednesday), August 5, 2008 (Tuesday), September 16, 2008 (Tuesday), October 28-29, 2008 (Tuesday-Wednesday), December 16, 2008 (Tuesday). The fact that the Federal Open Market Committee decided to increase the number of 2-day sessions from two to four in 2008 is an indicator of the concern in the economy at this juncture.
2. Calendar Section: Conferences, Online Chats and more: Check out the Calendar section of NataliePace.com regularly. There are many wonderful opportunities to chat one-on-one with millionaire money managers, life coaches, economists, respected money gurus, real estate veterans and CEOs! Be sure to check out the dates of the mid-month Hot News on Cool Stocks Update and the publication date of our next ezine. Get more information on how to best use our articles in the FAQs article, located under the Investor Edu link on the home page of NataliePace.com. Don’t miss the Milken Global Conference, the biggest gathering of billionaires, CEOs, Nobel Laureates, policymakers and money managers of the year.
3. Survey Results
Who is your favorite Presidential candidate? What will be the top performing asset class in 2008? Make your opinion count with our online surveys.
Hot Stocks List
Investors who "never pay retail," note that highlighted stocks are trading at their 52-week lows or near the price featured in NataliePace.com’s article. This may be a good buying opportunity. The companies that are listed below which are not highlighted may not be in a good buying range, but they appear to be poised to continue performing well (if you have already purchased them). There are never any guarantees in life, and all stocks are risk-based investments. Consult your certified financial planner before making any changes to your investment strategy.
Hot News List (highlighted)
Nothing. Waiting on the sidelines to see what happens at the end of the month.
DELETIONS:
Echelon
General Electric
LDK Solar
Satcon
Suntech Power Holdings
Trina Solar Ltd.
World Water & Solar
Zoltec
For more news on the companies we are featuring on the Hot News on Cool Stocks list, the Watch List and the Cooling Off List, go to the home page at NataliePace.com and click on the article of the same name. if you are trying to access the Hot News list when the article is not on the home page, simply click on Online Magazines (across the navigation bar) and select Hot News.
Track Record of my financial news Reporting
While the markets have fallen in 2008, the Hot News and Cooling Off lists below have a winning track record – in bear and bull market years. 18 companies listed below have performed quite strongly, while the year has stumbled with negative returns, versus just six that went in the opposite direction of the reporting. Even during the flat year of 2007, our featured companies had outstanding performance between Oct. 2006 and June 2007! 4 out of 9 companies – almost half – doubled or more from the time they were featured to the time they were taken off of the list. 48% of the companies featured in my stock newsletter between 2002 and 2005 – 25 out of 52 companies -- DOUBLED as well, and the majority of the remaining 52% well outperformed the marketplace. (See the chart in the article, "25 of Our Companies Have Doubled," from volume 4, issue 4, the April 2007 ezine, for a listing of companies.)
3 out of 5 Company of the Year selections more than doubled. My 2003, 2004 and 2007 Companies of the Year have posted up to 9000% gains (Taser), up to 690% gains (Opsware) and up to 215% gains (Suntech Power Holdings), respectively. MySpace, my 2006 Company of the Year, was a large part of News Corp’s success with shareholders that year. Only OSI Pharmaceuticals, my 2005 Company of the Year, has lost money. So three out of five are superperformers, one is performing well above the market and one is down. That’s the kind of record that puts you on top on Wall Street. (I launched my first publication on 11.15.02, and featured the first Company of the Year on 1.1.03.)
TipsTraders.com has ranked me at the top of over 830 A-list pundits, where I’ve repeatedly occupied the #1 position. TipsTraders.com listed me as a Highly Recommended Stock Picker, in 2006 and 2007. Some of our best picks include: Bioteq Environmental (BQE) +144%, Blockbuster Video (BBI) +82.5%, Genentech (DNA) +415%, Google (GOOG) +545%, Las Vegas Sands (LVS) +139%, LifeCell (LIFC) +180%, Macerich (MAC) +150%, Opsware (OPSW) +690%, Rio Tinto (RTP) +145%, Sohu (SOHU) +150%, Suntech Power Holdings (STP) +107%, Taser (TASR) up to 9000% gains and World Water & Solar (WWAT) +181%.
Monday, 4.11.2008 Gains since 1.2.08
Dow: 12,325.42 -6%
Nasdaq: 2,290.24 -12%
S&P: 1,332.83 -8%
Market Commentary
Overall, the weather forecast for 2008 is weakness and volatility, at least through June. The markets have been performing true to those expectations, thus, the only money being made are those day-traders who buy low and sell high, in very short windows, and those options traders who are buying and selling put options (bets that the share price goes down) in very short windows.
The markets lost money between January and April. However, anyone who bought at the low in mid-January and sold at the high in February made money, as did anyone who bought at the low in early March and sold at the high on April Fool’s Day. Puts (options betting that the share price will go down) were the easy money, however. (See our Cooling Off list for companies expected to go down in value.)
On the other hand, the stock market gains over the last 39 years have been steady and reliable – performing well above real estate, gold and bonds. During those 39 years, there have been plenty of tough times, including 2000-2002, Black Monday 1987, 9.11 and more, and still the overall return is above 10% for stocks. That means that on average, over the course of 20+ years, odds are good that you’ll still make $100 for every $1000 invested, even if your portfolio is slightly down or limping along in 2007-2008.
Investment Portfolio: Average Annual Gains 1968-2007
Small Cap Stocks 12.22%
Large Cap Stocks 10.52%
Corporate Bonds 8.47%
Gold 7.97%
Real Estate 6.4%
Source: Morningstar and Realtor.org © 2008
So, if you’re a nervous Nellie, turn off the tv, keep tithing to your Buy My Own Island Plan, make sure that you’ve got a percent equal to your age safe in bonds, Treasury Bills or the money markets and take a long term view. That perspective pays off over time, as you can see in the above chart.
If you are someone who is willing to work a little harder for gains, then the trick is buying great companies (especially those with a wide range in their 52-week low and high) when they are trading for a song and taking your profits early and often (which can be a few hours or a few days). If you’d like to learn my trading strategies, which have proven to beat the market in up and down cycles, be sure to sign up for the Get Rich and Green Retreat, which will be in Santa Monica, California, May 14-16, 2008. Call 866.476.7442 NOW, as only a handful of seats are available, or email Heather@NataliePace.com. You can find out more about this retreat at the Get Rich and Healthy banner ad on the home page.
To learn "Trading Tips for Turbulent Times" and how to "Recession-Proof Your Portfolio," read the articles of the same names from the February 1, 2008 ezine, which is archived at NataliePace.com in the online magazines section.
Market Movers:
The Bureau of Economic Analysis released its final report on the 4th quarter GDP growth on March 27th. The numbers came in at .6% -- a screeching halt from the robust 4.9% GDP growth in the 3rd quarter of 2007. The next GDP growth report – advance estimates for the 1st quarter 2008 GDP growth – will be released on April 30, 2008. This is a report that will be widely watched by institutional investors, so expect April 30th to be another wild ride in the markets – up if the numbers are more robust than anticipated (not expected), down, if the numbers are as anemic as the 4th quarter of 2007 was.
The market’s wild mood swings are almost directly correlated with headlines – up when Federal Reserve Board Chairman Ben Bernanke saves the day with another interest rate cut, crashing down whenever the reality of the depth and breadth of the real estate crunch hurts another fundamental measurement (like GDP growth). In short, I wouldn’t expect great news on April 30th. However, remember that if you’re capitalizing on the volatility in the markets, bad news one day usually means a rate cut the next day (and yet another rally). This month, the Federal Open Market Committee’s 2-day meeting begins the day before the GDP numbers are released, on April 29th, so be careful getting too gleeful about a Fed rate cut if they choose to take preemptive action on the GDP growth numbers.
Anticipate that April 30th could feature a different headline about the economy’s dangerous descent into negative growth (and a recession), unless a miracle happens and the economy performed better in the first quarter of 2008 than it appeared to have. (You’ll notice that I’ve taken most of our profits on the Hot News list anticipating a tough market towards the end of the month.)
For more BEA release dates, go to the BEA.gov website and be sure to visit the NataliePace.com calendar section often.
The Federal Open Market Committee and Monetary Policy
The Federal Open Market Committee has dropped the Fed Fund Rate each of the last five sessions. The Fed funds rate currently stands at two and one-quarter percent. Expect the Federal Reserve Open Market Committee to continue to ease investor worries, while monitoring inflation. The prevailing sentiment is still weak growth, a continued housing slump, more subprime foreclosures, a weak dollar, anemic consumer spending, turmoil in banks and financial services and rising unemployment.
Volatility prevails. In your nest egg, take a long term view and make sure that your assets are properly allocated. Keep a percentage equal to your age + 10-20% safe, i.e. not invested in the stock market (which means NOT invested in mutual funds, ETFs or bond funds). Safer investments include bonds, Treasury Bills, money markets, certificates of deposits, etc. FYI: Modern portfolio theory recommends that you always keep a percent equal to your age safe. Adding 10-20% is called overweighting into the safe categories, which is a good idea in turbulent, down-trending markets.
If Dr. Marc Miles, global strategist, is correct in his forecasts, the bottom of the market might occur between May and July of 2008. For more of Dr. Miles’ observations, be sure to read the transcript of his online chat in the March 2008 NataliePace.com ezine.
EDUCATIONAL OPPORTUNITES AND INFORMATION:
1. FOMC Information: Interested in reading the minutes of the March 18, 2008 FOMC meeting for yourself? You can. The official Federal Reserve document is available online. Click on FOMC, or go to FederalReserve.gov, to read! According to the minutes, "Further declines in house prices led to a noticeable decrease in the ratio of household wealth to disposable income in the fourth quarter. The downturn in equity prices since December further reduced household wealth in the first quarter."
The tentative FOMC meeting schedule for the 2008 calendar is: April 29-30, 2008 (Tuesday-Wednesday), June 24-25, 2008 (Tuesday-Wednesday), August 5, 2008 (Tuesday), September 16, 2008 (Tuesday), October 28-29, 2008 (Tuesday-Wednesday), December 16, 2008 (Tuesday). The fact that the Federal Open Market Committee decided to increase the number of 2-day sessions from two to four in 2008 is an indicator of the concern in the economy at this juncture.
2. Calendar Section: Conferences, Online Chats and more: Check out the Calendar section of NataliePace.com regularly. There are many wonderful opportunities to chat one-on-one with millionaire money managers, life coaches, economists, respected money gurus, real estate veterans and CEOs! Be sure to check out the dates of the mid-month Hot News on Cool Stocks Update and the publication date of our next ezine. Get more information on how to best use our articles in the FAQs article, located under the Investor Edu link on the home page of NataliePace.com. Don’t miss the Milken Global Conference, the biggest gathering of billionaires, CEOs, Nobel Laureates, policymakers and money managers of the year.
3. Survey Results
Who is your favorite Presidential candidate? What will be the top performing asset class in 2008? Make your opinion count with our online surveys.
Hot Stocks List
Investors who "never pay retail," note that highlighted stocks are trading at their 52-week lows or near the price featured in NataliePace.com’s article. This may be a good buying opportunity. The companies that are listed below which are not highlighted may not be in a good buying range, but they appear to be poised to continue performing well (if you have already purchased them). There are never any guarantees in life, and all stocks are risk-based investments. Consult your certified financial planner before making any changes to your investment strategy.
Hot News List (highlighted)
Nothing. Waiting on the sidelines to see what happens at the end of the month.
DELETIONS:
Echelon
General Electric
LDK Solar
Satcon
Suntech Power Holdings
Trina Solar Ltd.
World Water & Solar
Zoltec
For more news on the companies we are featuring on the Hot News on Cool Stocks list, the Watch List and the Cooling Off List, go to the home page at NataliePace.com and click on the article of the same name. if you are trying to access the Hot News list when the article is not on the home page, simply click on Online Magazines (across the navigation bar) and select Hot News.
Track Record of my financial news Reporting
While the markets have fallen in 2008, the Hot News and Cooling Off lists below have a winning track record – in bear and bull market years. 18 companies listed below have performed quite strongly, while the year has stumbled with negative returns, versus just six that went in the opposite direction of the reporting. Even during the flat year of 2007, our featured companies had outstanding performance between Oct. 2006 and June 2007! 4 out of 9 companies – almost half – doubled or more from the time they were featured to the time they were taken off of the list. 48% of the companies featured in my stock newsletter between 2002 and 2005 – 25 out of 52 companies -- DOUBLED as well, and the majority of the remaining 52% well outperformed the marketplace. (See the chart in the article, "25 of Our Companies Have Doubled," from volume 4, issue 4, the April 2007 ezine, for a listing of companies.)
3 out of 5 Company of the Year selections more than doubled. My 2003, 2004 and 2007 Companies of the Year have posted up to 9000% gains (Taser), up to 690% gains (Opsware) and up to 215% gains (Suntech Power Holdings), respectively. MySpace, my 2006 Company of the Year, was a large part of News Corp’s success with shareholders that year. Only OSI Pharmaceuticals, my 2005 Company of the Year, has lost money. So three out of five are superperformers, one is performing well above the market and one is down. That’s the kind of record that puts you on top on Wall Street. (I launched my first publication on 11.15.02, and featured the first Company of the Year on 1.1.03.)
TipsTraders.com has ranked me at the top of over 830 A-list pundits, where I’ve repeatedly occupied the #1 position. TipsTraders.com listed me as a Highly Recommended Stock Picker, in 2006 and 2007. Some of our best picks include: Bioteq Environmental (BQE) +144%, Blockbuster Video (BBI) +82.5%, Genentech (DNA) +415%, Google (GOOG) +545%, Las Vegas Sands (LVS) +139%, LifeCell (LIFC) +180%, Macerich (MAC) +150%, Opsware (OPSW) +690%, Rio Tinto (RTP) +145%, Sohu (SOHU) +150%, Suntech Power Holdings (STP) +107%, Taser (TASR) up to 9000% gains and World Water & Solar (WWAT) +181%.
posted by NataliePace.com at
11:25 AM
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