Archives for September 2011

September 2011 - Page 7 of 10 - Money Morning - Only the News You Can Profit From

Our Economic Recovery has been Hijacked

Money Morning Chief Investment Strategist Keith Fitz-Gerald joined CNBC Asia's "Squawk Box" program to discuss U.S. President Barack Obama's new jobs proposal. President Obama is in a tough spot, trying to get approval for new tax increases to pay for a $447 billion jobs package — and Fitz-Gerald said it's unlikely he'll be able to […]

Read More…

We Warned You U.S. Stocks Could Plunge - Here's the Safety Play You Need to Make Now

U.S. stocks reversed course in the final minutes of trading yesterday (Monday) to push the Dow Jones Industrial Average back over 11,000 – but that still wasn't enough to make a dent in the index's 4.8% loss so far this month.

Europe debt fears and dismal economic news have caused the Dow to fall in five of this month's seven trading sessions, each time by more than 100 points.

We warned you September would be a tough market month – several times.

What's more, we showed you how to protect yourself.

To continue reading, please click here...

How to Hedge Gold

Gold prices have had a phenomenal run over the past year, but the distinguishing feature of the market in recent weeks has been extreme volatility – volatility that has many investors nervous about protecting the big profits they've rolled up and looking for ways to hedge gold.

Now, we don't advise jumping off the gold bull's back just yet – especially since Money Morning's leading gurus see a gold price climb to $5,000 possible over the long haul. But you may want to consider taking out a little short-term "insurance" on your precious metals profits.

In fact, we suggested readers do just that in the Aug. 22 issue of Money Morning Private Briefing. We even went a step further and issued step-by-step instructions for a gold-hedging strategy.

Just two days later, on Aug. 24, gold suffered its third-worst down day in history, plunging 5.6%.

Readers who took our advice reaped windfall profits as a result. And now we're giving you the same opportunity.

We're back today with another strategy to help "insure" your gold profits.

The Secret Way to Hedge Gold

The only thing you need to do to hedge gold is follow this simple options strategy.

.

To continue reading, please click here

Amazon Kindle Tablet Will Plump Revenue and Disrupt Market

A rumored Amazon Inc. (Nasdaq: AMZN) Kindle Tablet will deliver billions of dollars in fresh revenue next year.

In addition to its hardware sales, the tablet will provide a quick and convenient way for Amazon to capture a bigger chunk of the digital media market and allow customers to buy any of its millions of offerings from almost anywhere.

The 7-inch tablet is expected to appear within the next month or so and cost just $250. Such a low price from a trusted brand like Amazon will disrupt the entire tablet market.

"A proprietary tablet would allow Amazon to widen itscompetitive moat, improve consumer experience and benefit from the rapid growth in mobile usage," Jefferies & Co.'s (NYSE: JEF) Youssef Squali wrote in a report.

Although analysts expect Amazon to make little profit from the tablet itself, its potential for selling more of its digital wares such as e-books, movies, music and Google Inc. (Nasdaq: GOOG) Android apps is boundless.

The Kindle e-reader shows how hardware can drive media sales. It has helped Amazon capture 90% of the e-book market.

The Kindle e-reader will account for 9.9% of Amazon's total revenue next year, just five years after its debut, according to Citigroup Inc. (NYSE: C) analyst Mark Mahaney. Mahaney estimates about half of that revenue, $6.1 billion, will be from sales of the device, with the other half from e-books.

An Amazon Kindle Tablet will open up multiple digital avenues of growth.

Take online video sales, for example. Amazon has just 4.2% of that market, well behind the 65.48% share of Apple Inc.'s (Nasdaq: AAPL) iTunes Store.

In terms of additional revenue, the Kindle tablet could quickly rival that of the e-reader.

To continue reading, please click here...

Investment Protection: These Dividend Stocks Yield Twice as Much as Treasuries

Do you know what the ultimate investment protection is?

It's not gold, and it's certainly not Treasuries.

It's dividend stocks.

Companies that pay consistent dividends are in better fiscal shape than the U.S. government and the payouts significantly outpace those of Treasuries. The advantage over gold of course is that the yellow metal yields nothing – it's simply a store of value.

And yet dividend stocks also protect against inflation, since profits for the companies behind them tend to rise alongside prices.

To understand the advantages dividends can provide an investor during a down market, just look at the implosion of the dot-com bubble in 2000.

According to Morningstar research, the Standard & Poor's 500 Index lost 9%, while dividend-oriented mutual funds – including high-yielding stocks in the financial-services, mutual-fund and real-estate sectors – gained anywhere from 10% to 30%.

And I shouldn't need to remind you that dividends account for the majority of the stock market's returns.

A study by Yale economist Robert Shiller showed that in the 109 years from 1889 to 1998, the average real return on common stocks was 7%, of which 4.7% was represented by dividends.

While stock prices have been plunging, dividend payments are rising. Through Aug. 31, 243 companies in the Standard and Poor's 500 Index increased or initiated a dividend payment. In fact, dividend payments are expected to end 2011 up 18% from 2010.

That's the case for dividend stocks. Now I'm going to give you some potent investment ideas to help you get on board.

Investing in Dividend Stocks

Generally speaking, there generally are two types of dividend stocks. There are large blue chips, which have a reliable but modest payout. And then there are the obscure companies, which have a higher yield but less safety.

In the first set you'll find companies like

to continue reading, please click here...

Investing In Wine: How To Invest In Wine For Profit

At a time when the only thing consistent in the stock market is volatility, investing in wine offers you steady profit growth – with a more fun, tasty experience than your typical investment opportunity.

You can't buy a share of Google and have close friends over to drink some of it. You can, however, have good company over to taste your 1989 Bordeaux. David Sokolin, a highly respected wine merchant with years of experience, states that IGW ("Investment Grade Wines") should return between 10 and 12 percent annually. He also says that they will also do this with lower volatility compared to stocks and bonds. For example, from 2002-2007, Coca-Cola's stock (NYSE:KO) went up 9.72%. If you were to buy a case of 2005 La Mission Haut Brion back in 2008 for $7,800, you might expect it to be valued at $30,000 in the year 2018, a 284.6% gain!

That's pretty impressive for a bunch of fermented grape juice.

To continue reading, please click here...

Buying Silver As An Investment

Right now, Silver ETF prices are on a major tear. They are poised to break even higher by the end of the year.

And this report shows why that's not about to end any time soon – and exactly how far silver is expected to run.

In fact, silver could be the most lucrative precious metal of 2011.

Here's why

No Housing Bottom in Sight

Economic Intersection Article of the Week Guest author: Keith Jurow is the author of the MVP Housing Market Report. This article was posted at Minyanville with the title "There Is No Housing Bottom in Sight" At the end of June 2011, macromarkets.com released the results of a poll in which 108 leading economists and housing […]

Read More…

Obama's Jobs Plan Will Barely Dent Unemployment

Even if passed intact, U.S. President Barack Obama's jobs plan, though ambitious, would at most nudge down unemployment by a single percentage point over the next year.

Furthermore, the Republican-controlled House of Representatives will surely object to several provisions in the American Jobs Act – particularly the total $447 billion price tag – further diluting its impact.

President Obama's jobs plan includes:

  • Tax breaks for both individuals and businesses.
  • Financial aid to states aimed at repairing schools and retaining public sector jobs such as policemen and teachers.
  • An extension of unemployment insurance.
  • And money to repair and upgrade transportation infrastructure, such as highways, railroads, and airports.

Wall Street, already worried about events unfolding in Europe, seemed less than impressed by the proposals. Stocks started down Friday, the morning after President Obama's jobs speech, and meandered lower throughout the session. The Dow Jones Industrial Average slipped 2.69%, while the Standard & Poor's 500 Index dropped 2.67%.

"There was nothing in the president's speech that would inspire the stock market one iota forward, and I think we can see that reflected already this morning," Money Morning Capital Waves strategist Shah Gilani said on the Fox Business Network program "Varney & Company."

To continue reading, please click here.

Chesapeake Energy Corp. (NYSE: CHK) Could Be the Sector's Best Takeover Target

When you hear the term "takeover target," you typically think of a small biotech or technology company – but that's not the case here.

I've found a company that logged $1.4 billion of adjusted EBIDTA and $1.2 billion of operating cash flow. And it just happens to be the second-largest natural gas producer in the United States.

I'm talking about Chesapeake Energy Corp. (NYSE: CHK) – a company that has increased production for 21 consecutive years.

In addition to being the second largest U.S. gas company, Chesapeake is the No. 1 horizontal-well driller in the world, and the most active new-well driller in the United States. The company holds a large portfolio of shale properties, and it plans to triple profitable liquids production.

Even aside from the fact that the company is an attractive takeover target, Chesapeake has enough going for it that it deserves a place in our portfolio.

So it's time to buy Chesapeake Energy Corp. (**).

Read more…

Read more...