Archives for September 2012

September 2012 - Page 3 of 19 - Money Morning - Only the News You Can Profit From

Play Rising Silver Prices With These ETFs

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Silver prices hit a six-month high at the end of the last week, closing around $35 per ounce.

In the last month, silver has undergone an 18% rally and year-to-date it is up 24.28%.

Silver and gold, which hit its own six-month highs, provide a nice hedge from inflation resulting from recent central bank action such as the U.S. Federal Reserve's latest stimulus measure, QE3.

"While QE1 and QE2 clearly did little to help the unemployed, their effects on the markets were undeniable," said Money Morning Global Resource Specialist Peter Krauth. "Commodities soared. Since March 2009, Gold is up 97%, silver is up 162%, oil is up 122%, and the Continuous Commodity Index (CCI) is up 55%."

Something metals investors should note: The white metal has been outperforming gold.

After February highs for both metals, gold rebounded sooner than silver did. By mid-May, it was back, while silver took until June to see gains again.

When rumors started earlier this year that QE3 would be announced, silver was just coming off of its low. The rumor mill gave it enough fuel to light a fire under the price, and after the recent Fed announcement silver price gains have outpaced those for gold.

Since Team Bernanke announced QE3 on Sept. 13, silver prices are up 2.7% while gold has gained about 0.6%.

Now that Fed Chairman Ben Bernanke just gave metals a shot in the arm, here's how to play a nice silver price rally with exchange-traded funds (ETFs).

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Will Global Unrest Slash Your Profits?

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Riots in Spain and protesters in Greece are wreaking havoc in those countries, causing concern that violence could spread throughout Europe. There is also heightened speculation and fear over the effects of aggressive political messages from Iranian President Mahmoud Ahmadinejad. So as an investor what should you do with the increasing global unrest? Money Morning's […]

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The QE3 Dangers Bernanke Isn’t Telling You About

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Hoping the third time is the charm, the U.S. Federal Reserve voted on Sept. 13 to launch another bond-buying program, QE3.

Equity and commodity markets cheered the Fed's move. Stocks rallied and analysts raised precious metals price forecasts.

QE3 differs from the first two rounds in that it is an aggressive open-ended purchase program of $40 billion per month of mortgage-backed securities. The buying is slated to continue until we reach substantial and sustained improvement in the U.S. economy, which won't be a short-term achievement.

The program aims to lower long-term interest rates, stoke consumer demand and bring down the elevated unemployment rate.

But some opponents think the latest stimulus measure from Fed Chairman Ben Bernanke will fail to achieve any of that.

In fact, the QE3 doubters have a lot to say – and anyone with money in the markets right now should pay attention to what could happen.

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Hot Picks for Fed Money Printing

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  • QE3 could be $1.2 to $2.0 Trillion
  • Will Ben Bernanke Awaken the Inflation Monster?
  • How to Invest When Fire Hoses of Money Are on Full Blast
  • Use Gold Futures & Options to Send Your Profits Soaring!

The latest round of quantitative easing by Fed Chairman Ben Bernanke was anticipated by Wall Street-but it's also a game changer.

That's because

the sheer size and scope of QE3, as it is called, will have tremendous and long-lasting effects from Wall Street to Washington and across America.
We saw a game-changer in the Federal Reserve's decision to proceed with a new round of quantitative easing (this one is focused on mortgage backed securities), an extension of Operation Twist through the end of the year, and keep interest rates low "at least through mid-2015."

This
amounts to a flood of money, and that rising tide should lift asset prices, including both commodities and stocks.

For many investors, the biggest question is "what should I do with my money now?" In this special report, we'll show you what history tells us about quantitative easing … why this QE is so different … how this could send ripples through the market for years to come…and what your best bets are to protect your money and invest for potentially big, fat profits.

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Mixed 4Q for Jabil - Analyst Blog

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Jabil Circuit Inc. (JBL) reported fourth quarter 2012 earnings of 44 cents (including stock- based compensation of $21.3 million), which missed the Zacks Consensus Estimate by 6 cents. This miss was primarily due to higher operating expenses in the quarter. Quarter Details Revenue increased 1.4% year over year to $4.34 billion. This was within management’s […]

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Packaging Corporation of America - Growth & Income

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Shares of Packaging Corporation of America (PKG) are nearing its 52-week high as the third-quarter earnings release approaches. The manufacturer of containerboard and corrugated products has beaten the Zacks Consensus Estimate for the past five quarters. This Zacks #2 Rank (Buy) has also been consistently distributing dividends, and currently has a solid 3.0% yield. Promising […]

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Is the Soaring Stock Market Hiding a Darker Truth?

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In my role as executive editor, I subscribe to dozens of newsletters, wire services, trade journals and news-bulletins. They roll into my e-mail box each day like an eight-hour-long avalanche.

Usually, I just open the ones that happen to catch my eye. One was this recent headline from a MarketWatch.com bulletin that said, "Dow closes at highest level since December 2007."

My first thought was that the bulletin should have said: "Dow closes at highest level since December 2007 – despite faltering economy, stubborn unemployment, accelerating inflation and the highest level of uncertainty we've seen in decades."

I guess they couldn't fit all that into the subject line box.

My second thought was that Martin Hutchinson was right – again.

You see, for the last couple of years the administration in Washington and the so-called experts on Wall Street have repeatedly told us that inflation isn't a problem. They continue to insist that the bailout plans and easy-credit policies that were used to end the financial crisis have yet to ignite the rise in prices that you and I refer to as "inflation."

However, in the Aug. 21 Private Briefing, Martin completely dismissed this Pollyanna point of view. There is inflation, he said. In fact, it's staring us right in the face – as a soaring stock market.

According to Martin, the "Real Dow" should be much lower.

Another Stock Market Bubble

With so much economic uncertainty – read that to mean, so much "risk" – there's no way stocks should be zooming like this, Martin said. The fact that they are is proof of a cheap-money-fueled "asset bubble" – a form of inflation, he explained.

The Permanent Wealth Investor editor also predicted that U.S. stock prices would continue their advance – especially if the U.S. Federal Reserve appeared willing to add additional stimulus.

And as the MarketWatch.com bulletin illustrated, that's precisely what happened.

Here's the thing: Now that "QE Forever" has arrived, this inflationary surge is about to get much, much worse.

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The Consensus in Europe is Simple, Oil Prices are Headed Higher

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My latest trip to London may have centered on the briefings I gave on Iranian oil sanctions, but I also did a number of media appearances.

As I have mentioned before, questions from European interviewers are generally more knowledgeable and to the point than in the states. This may be because places like London are much closer to the events directly affecting oil prices.

However, there was a surprising element.

Nobody – be he/she a commentator, journalist, analyst, or expert – expected a fall in oil prices. The entire market environment in Europe is looking in the other direction.

In London, my predictions of $130 a barrel for Brent and $115 for WTI (West Texas Intermediate, the benchmark crude traded on the NYMEX) by the end of 2012 were considered on the low side.

My further suggestion of $150 for Brent and $130 for WTI by the end of 2013 have caused some disagreement in the states, but are par for the course averages for what people are saying over in Europe.

In fact, the overwhelming consensus in Europe is that oil will rise, absent exogenous economic or financial problems.

In other words, the price can go down, but such a move would be a result of another bout with credit crises, intra bank problems, or currency weakening.

In such situations, the lowering of oil prices has nothing to do with oil, or its supply/demand balance, or its trade. Rather, economic constriction results in concerns over short and medium-term demand and those translate into a lower price.

Left on its own, the consensus over here is simple. Oil goes up.

Concerns Grow in Europe Over Oil Prices

Now, unlike in the U.S., the conversation does not then immediately move to prices at the pump.

Gasoline is less of an issue for the simple reason that a combination of heavy taxation, lowered usage and a far better mass transit system has made driving more of a luxury than in the U.S.

Paying the equivalent of $7 a gallon tends to have that effect.

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If President Obama Wins Election 2012, What's Next?

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With nearly four years under President Barack Obama's reign, America's economic recovery is struggling to pick up speed and unemployment remains above an unhealthy 8%.

The Obama administration has repeatedly been harshly criticized for bailing out corporate businesses, for the massive national deficit and for the creation of the controversial healthcare bill dubbed Obamacare.

Yet, with just six weeks left before Americans head to the polls to cast their vote for the 45th president, President Obama has managed to eke out a slight lead.

In a mid-September interview with "60 Minutes," President Obama defended his term and said he and we need more time with him in office.

Here's what to expect if President Obama wins Election 2012.

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Why Facebook Stock Has Much Farther to Fall

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After Facebook Inc. (Nasdaq: FB) CEO Mark Zuckerberg addressed the public earlier this month to stem concerns over the stock's steep and steady fall, Facebook shares enjoyed a mild rally.

That was fun for investors while it lasted.

Facebook stock Monday renewed its descent, dropping 11% before stabilizing a bit to finish the day down 8.3% at $20.79.

Monday's intraday decline was the steepest since July 27. It was so sharp it tripped Nasdaq's circuit breakers meant to shield investors from short-seller manipulation.

Sparking this week's selloff was a fresh report from Barron's that said the company is overvalued. Renewed concerns over how quickly the social-networking behemoth can capitalize on revenue from the exploding number of users who access the site via mobile devices and tablets contributed to the drop.

Tuesday morning, the selling continued.

Before the recent selling spree, shares of the Menlo Park, CA-based company had given back some 45% since its hugely hyped initial public offering on May 18.

But that decline isn't enough.

Barron's gave Facebook a best-case scenario of $15 per share.

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