Archives for February 2013

February 2013 - Page 13 of 17 - Money Morning - Only the News You Can Profit From

Bull of the Day: Michael Kors (KORS) - Bull of the Day

High-end and "accessible" luxury demand fashion this designer's growth around the world COACH INC (COH): Free Stock Analysis Report NORDSTROM INC (JWN): Free Stock Analysis Report MICHAEL KORS (KORS): Free Stock Analysis Report To read this article on Zacks.com click here.

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These Four Simple Words Are the Key to Your Investment Success

If there's one single, indispensable key to successful investing, it's to go with the flow.

That's my distillation of well-worn market mantras that you're probably familiar with.

They include:

The trend is your friend;

Don't fight the tape;

Trade the market you are given, not the one you want;

And don't fight the Fed.

Go with the flow.

You can do all the homework and analysis you want – and be right – and yet still lose money. That happens when you own stocks you love, but the market isn't loving any stocks. It can happen when you try to pick bottoms, and you get in before the market heads a lot lower.

And while you won't lose any money by not being in the market, you're not going to make any money in it either.

That brings us to today. We've had a furious up-move in the market since March 2009. We're scratching at new all-time highs, and global markets are dancing to the same tune.

But the world hasn't changed since last May – or the May before, when markets swooned on fears about Europe, America's fiscal fiasco, a slowing China, or any of the other dark clouds that, at any time, can rain on the markets.

So, are we going higher? Are we going to get a wicked correction? Is the sun rising or setting?

We don't know if the market is going higher from here or if it's headed down. But, we do know that the sun rises and the sun sets… every day.

That's why, even if you could distill all of the unknowns that you don't know into a plan of action, the only sensible plan is to not guess, but simply to go with the flow.

As Insiders Head For the Exits, Do They Know Something "We" Don't Know?

Whenever the markets begin to look toppy like they do now, I turn to short-term indicators to help me figure out "what's next" for the markets. It complements the fundamental analysis I rely on for the big picture.

Some people – lots of people, in fact – will tell you that this is a wasted exercise. Predicting the markets, they say, can't be done. I disagree if for no other reason that if that were true, guys like Jim Rogers, Warren Buffett, Steve Jobs, Richard Branson and Carlos Slim wouldn't be the legends they are today.

As I see it, learning to "read" the markets and anticipate its twists and turns is absolutely possible.

But let me qualify my statement. My goal is not necessarily to be "right."

Any savvy trader will tell you the objective is to get enough of a read – right or wrong -so that you can use the appropriate tactics needed to be profitable.

For example, the markets have one heckuva run and flirted with new highs in recent trading. To the casual investor, it appears that things are good because the economy is gradually recovering.

2013 Tax Changes: These 5 Deductions and Loopholes Might Get Slashed

Americans are still adjusting to the effects of the payroll tax increase, but these proposed 2013 tax changes could pack an even bigger financial hit.

That's because Washington is desperate for additional revenue streams.

To solve the problem, U.S. President Barack Obama and others have suggested closing some loopholes and altering deductions in order to reduce the budget deficit and avoid some of the automatic spending cuts.

Unfortunately, you probably benefit from some of these tax breaks right now.

Here's a breakdown of five tax deductions and loopholes that could be in danger.

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Why David Einhorn Needed to Sue Apple (Nasdaq: AAPL)

Outspoken fund manager David Einhorn feels so strongly about the need for Apple Inc. (Nasdaq: AAPL) to share more of its cash with its stockholders that he has sued the company.

Shareholders like Einhorn – whose Greenlight Capital fund owns between 1.3 million and 1.5 million shares of AAPL – think the Cupertino, CA-based company should use its monstrous cash pile of more than $137 billion to boost its return.

Einhorn's lawsuit came after his request last year that the tech giant create shares of preferred Apple stock that would exist solely to pay a dividend about twice what the common stock currently pays.

But Apple has included a proposal on its Feb. 27 shareholder ballot that would amend the company's corporate charter to eliminate its ability to create preferred stock. It also has combined that issue with two other unrelated issues in the same proposal.

Einhorn is suing Apple because he says Securities and Exchange Commission (SEC) rules prohibit such bundling, and because he wants to ensure the company will be able to create the type of preferred shares he has proposed.

To further hammer home his point, Einhorn wrote a letter to all Apple shareholders, which was released today, in which he explained his position and urged them to vote against Proposal 2 in the shareholder ballot.

"Proposal 2 is value destructive, impedes the Board's flexibility, and does not merit shareholder support," Einhorn wrote.

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Find the Best Stocks to Buy Now as M&A Activity Heats Up

The return of major deal making in 2013 could deliver huge profits to investors who know the right stocks to buy now.

After the financial crisis, deal making – once quite common a decade ago – came to a near halt. But corporate mergers, takeovers and LBOs started heating up at the end of last year.

The last three months of 2012 saw the highest three-month deal totals and highest deal spending in the past two years, with the year ending on a high note.

According to FactSet Research Systems Inc., "U.S. M&A activity went up in December, increasing by 20.2% with 918 announcements compared to 764 in November, the second largest increase in 2012."

The trend is expected to accelerate further this year.

Standard & Poor's predicts a whopping $1 trillion in mergers will be announced in 2013. That would be an 11% increase over last year and would mark the first time mergers would hit the $1 trillion mark since the Great Recession.

LBO volume is also expected to trend higher this year. LBO volume dipped in 2012 to $98 billion, down from $111 billion in 2011.

In fact, Dell Inc.'s (Nasdaq: DELL) announcement Tuesday that it agreed to a leveraged buyout (LBO) with Silver Lake Partners stoked plenty of talk about the best stocks to buy ahead of increased M&A activity in 2013.

Dell's $24.4 billion LBO wasn't the only activity fueling 2013 deal talks.

Also announced was a $16 billion deal between John Malone's Liberty Global (Nasdaq: LBYTA) and U.K. television and Internet provider Virgin Media (Nasdaq: VMED). In addition, rumors swirled Tuesday that Hewlett-Packard Co. (NYSE: HPQ) is considering breaking up the company.

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If You're Investing in Bonds, Bill Gross Has a Message For You

If you're investing in bonds, Bill Gross just delivered you a serious warning.

Gross wrote in his February newsletter that the factors that contributed to last month's 1% loss for U.S. Treasuries – the biggest since March 2012 – aren't going away any time soon.

Total debt, which includes corporate, government and household, has expanded from $3 trillion in the 1970s to about $56 trillion today, explained Gross. He said that's left bond yields in the 1% – 2% range, instead of the historic level of 3% – 4%.

Gross said the staggering amount of debt in the United States has created a "credit supernova" that could crush the bond market as the global credit bubble "is running out of energy and time."

"Our credit-based financial markets and the economy it supports are levered, fragile and increasingly entropic," Gross wrote.

Gross warned that anyone investing in U.S. government bonds should evaluate their exposure.

And he isn't alone. Jim Rogers and Goldman Sachs have both been bearish on bonds.

"I'm short long-term government bonds," Rogers said Feb. 6 on Bloomberg Radio. "I plan to short more. That bull market, that's a bubble."

So what should bond investors who want yield do with their money?

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Why a Rising Euro is Likely Despite Draghi Comments

European Central Bank President Mario Draghi warned about excessive euro strength at a press conference today (Thursday) following his announcement that the ECB had left interest rates unchanged, as expected.

In response to a reporter's question on whether there was a currency war in progress, Draghi said, "I think we should have in mind one thing: changes in the exchange rates that we see today are not really deliberate competitive devaluations. They are more the effect of macroeconomic policies that are meant to revamp the economies – for example, very low interest rates, promises to stay low for a very long time.

"However, if these policies produce consequences on the exchange rates that do not reflect the G20 consensus, we will have to discuss this."

Draghi said the exchange rate is not a "policy target" but is "important for growth and price stability," adding, "We certainly want to see whether the appreciation – if sustained – will alter our risk assessment as far as price stability is concerned."

Observers blogging and tweeting from the room where the press conference was being held felt Draghi was being very careful in choosing his words and interpreted this as a sign that he was, in fact, attempting to talk down the euro or at least slow its rise against other major currencies.

Traders immediately sold the euro against the U.S. dollar and against the Japanese yen. The euro is currently trading down about 200 pips against the U.S. dollar and is off more than 150 pips against the Japanese yen.

There is no doubt Draghi succeeded in halting the rise of the euro, at least for today. But if the ECB is serious about putting a lid on the euro's strength, its options are limited.

Because the ECB must take into account the laws and preferences of its constituent national central banks, it would not be easy to intervene in the foreign exchanges market – except in extreme circumstances – or to undertake a competitive expansion of the ECB balance sheet as the Fed and the Bank of Japan are doing.

The ECB could create new credit by purchasing private-sector assets, as the Bank of England and the Bank of Japan have done, but it is unclear how the conservative Germans would react to such a plan.

Or Draghi could just keep talking.

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Glaxo Strengthens Indian Presence - Analyst Blog

GlaxoSmithKline (GSK) recently increased its holding in its consumer healthcare subsidiary in India, GlaxoSmithKline Consumer Healthcare Ltd, from 43.2% to up to 72.5%. The transaction is valued at approximately £568 million. The final payment for the shares is expected to be made on or before Feb 13, 2013. We are positive on the deal, which […]

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This Hot New Patent Has the 3D Printing World Abuzz

Over the last two years 3D printing stocks have been on fire.

Stratasys Ltd. (Nasdaq: SSYS) has earned investors a two-year return of roughly 131%, while my favorite player, 3D Systems Corp. (NYSE: DDD), has delivered 255% gains.

I can't say I'm surprised. As I wrote last March, 3D printing is a $1 trillion dollar industry in the making.

It's what's known as a "disruptive technology."

And by the end of this decade, everyone from consumers to big businesses will be able to make their own unique products in just a couple of hours.

There's only one problem: Aside from Stratasys and 3D Systems, there haven't been many other ways for investors to play this hot market

Not only that, but the industry has gone through a consolidation as these two firms have snapped up several of the smaller players.

That has left investors with very few options-until now.