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Stocks

The Generational Investments to Stay Safe in This Market

Prisoner shackle with word "debt" on the iron ball, concept of escaping debt and dependency on credit. Isolated on white background.

Stocks actually rose last week, although you'd be hard-pressed to find an investor or hedge fund manager who is feeling good about things right now.

But the Dow Jones Industrial Average did in fact gain 105 points or 0.7% to close at 16,093.53 while the S&P 500 rose by 1.4% or 27 points to 1906.90. The Nasdaq Composite Index, home of the FANGS, added 2.3% to close at 4591.18. But as the title of the novel goes, it's "been down so long it looks like up to me."

All three markets are still down sharply on the year and many hedge funds are nursing double digit losses just three weeks into the year.

Here's How Low the S&P 500 Could Go in This Bear Market

stock-market-chart-gaph

The bear market deepened last week as investors sold everything that wasn't tied down that had the faintest tinge of risk associated with it - stocks, commodities, junk bonds, you-name-it.

The Dow Jones Industrial Average lost 358 points or 2.2% to close below 16,000 at 15,988.08 while the S&P 500 fell 42 points or 2.17% to close under 1900 at 1880.33.

But losses could get even steeper from here...

The Next Financial Crisis Is Unfolding Now

Sign Yield

Money Morning Members should know two things. First: the 2008 financial crisis was caused by a housing bubble, centered in the U.S., that radiated out through the rest of the world and almost destroyed the global financial system.

Second: The next financial crisis - which is starting to unfold as we speak - was caused by a commodities bubble centered in China that radiated out through the rest of the world and will cause enormous financial damage, threatening the global financial system.

Both crises were aided and abetted by central banks printing massive amounts of debt that can never be repaid. That leaves the world with three choices for how to deal with that debt - currency depreciation (which is why you should buy gold), inflation, and default.

The Two "Bandits" Ripping Off Investors This Week

nasdaq stocks

Just because central bankers want to lead investors over the cliff like they did in 2008 doesn't mean that people should follow them.

Unfortunately, that's exactly what investors did last week. In a year that has seen many foolish rallies, Friday's massive rally in stocks - coming just a day after a massive sell-off - was the most foolish of all.

Let's take these one at a time...

Here's the Truth About Macy's Inc.'s Direction (NYSE: M)

red-macys-sign

For the last few years, the Wall Street has been a non-stop cheerleader for Macy's Inc. (NYSE: M), the iconic retailer.

But the music has stopped. Because behind the uncritical boot-licking of Wall Street analysts and television presenters and Macy's Thanksgiving Day Parade balloons, the traditional retail business was rotting away.

In the last four months, the stock has collapsed by more than 40% to $39.05. Unfortunately, a lot of investors really got hurt on this one - especially last week.

Here's the truth about Macy's direction.

The World Can No Longer Ignore These Threats

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As the world reels from the barbarous, but all too predictable, terrorist attacks in Paris on Friday evening, markets will also be trying to regain their balance after a difficult week. What the Paris attacks have in common with last week's market losses is that they both disabused observers of the illusions that they can continue ignoring the consequences of political and policy weakness.

Continue reading...

Tech Stocks Poised to Rise on This Economic News

tech stocks

As we've talked about in several recent conversations, I live by the credo "always have some money invested in tech stocks" - no matter how much "noise" you hear out of Wall Street and Washington.

Otherwise, you'll miss opportunities to buy winning stocks when they are "on sale." Worse, you'll miss taking a big profit from the rebound.

Here's a breakdown of brand-new market data proving this - and why you should be bullish about tech investing for the rest of 2015...

Why Wall Street Is So Desperate for Your Investment Dollars Right Now

Financial News

Now is the time when Wall Street is most dangerous to your financial health.

After being 100% wrong about the market all year, Wall Street's big shot strategists are now telling investors to "get ready for a big fourth quarter rally."

You never hear a discouraging word from these so-called experts.  They all read off the same script - and that script is designed to get John Q. Public to buy as many stocks and bonds as Wall Street can sell them.

Read more...

Shelter from These Storms in the Distance

greem-stocks

In South Florida, we call the dog days of summer the "mean season", as vicious thunderstorms move over the Everglades every afternoon and attack the east coast with lightning strikes and blinding downpours. We keep our fingers crossed that the storms won't morph hurricanes that can sweep the ocean over the land and cause catastrophic destruction.

After a period of intense hurricane activity in the early 2000s, it's been ten years since we've been hit by any serious storms, and we are being told that strong El Nino conditions will likely protect us again this season. But we know that sooner or later our luck will run out, and we will be back in the eye of dangerous winds and storm surges. And, at least for a moment, we'll wish we lived somewhere other than in paradise.

Stock market investors are experiencing similar feelings after a six year hiatus from reality, courtesy of the Federal Reserve.

Paradise is starting to give way to a very mean season...

In July, Investors Were Guests at the Market's "Red Wedding"

market high illistration

The simultaneous blood baths in commodities and U.S. stocks continued in July but failed to penetrate the skulls of U.S. stock investors who continue to allow themselves to be brainwashed into believing that they can only make money by owning an overbought market.

The S&P 500 (INDEXSP:.INX) recovered all of its June losses, gaining 2.1% in July including 1.2% last week to close the month at 2103.92, not far off its record closing high of 2,134.72. The index is now up 2.2% (excluding dividends) for the year.

At this point, investors can no longer ignore the fact that the knives are coming out...

Navigating the Shoals of an Overvalued Market

1. IPOS

Stocks have struggled to rally in recent weeks, but that hasn't stopped the IPO market from offering investors the chance to leave reason behind.

Last week, two particular deals demonstrated that while the overall market is expensive, pockets of it are undeniably in a bubble.

Here's what you should know about the IPOs and the week...

Here's what you should know about the IPOs and the week...

Teva Finally Puts a Number on Mylan Deal, Investors Stand to Profit

stocks

Teva is a 114-year old maker of pharmaceutical generics, and they've generated lots of cash along the way. They've been coy about their intention to purchase Mylan, but now there's a healthy number on the table, and share prices are on the way up...

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Arrest of "Flash Crash" Trader Could Reshape High-Frequency Trading

small-cap stocks

The arrest of alleged flash-crash architect Navinder Singh Sarao could reshape the debate over high-frequency trading. The British futures trader reported to be largely responsible for the 2010 flash crash is fighting extradition to the U.S., where he faces a potential 380 year sentence for market manipulation and fraud, according to Bloomberg.

His arrest, and the heavily punitive charges against him are a "very significant" development...

Avoid the Spread of This "China Syndrome"

china gold dragon

Stocks were sailing toward new record highs last week until they suddenly came crashing down on Friday. The shift occurred after China took steps to rein in its parabolic market by easing restrictions on short selling and raising margin requirements.

This is what happens when equity investors decide to ignore weak earnings, deteriorating economic conditions and geopolitical chaos and place all of their faith in the ability of central banks and other regulators to bail them out time after time...

Keith Appears on CNBC's Street Signs

big banks

Money Morning's Keith Fitz-Gerald nails China's GDP growth, gives his quick read on big bank's reported earnings, and cautions against taking a short-term view during any earnings season.

Keith's thoughts as he appears on CNBC...