Archives for February 2013

February 2013 - Page 9 of 17 - Money Morning - Only the News You Can Profit From

Investing in China: Out With the Dragon, In With the Snake

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During this Chinese New Year, more than a billion people will be welcoming in the Year of the Black Water Snake, celebrating with family and friends all week long.

The previous Year of the Black Water Snake was in 1953, which was when China launched its first Five-Year Plan and the average annual income for a family in the U.S. was about $4,000.

As the Dragon took its last breath of the year, it exhaled plenty of fire into China: Looking at year-over-year data as of the end of January, new bank loans, passenger car sales and exports all rose while inflation was slightly lower. Imports of key commodities we track, crude oil, aluminum and copper, were also exceptional, with month-over-month increases of 6 percent, 4 percent and 3 percent, respectively.

Eurozone Debt Crisis: Why U.S. Investors Still Can't Relax

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After nearly four years, billions in bailouts and increasingly strict austerity measures, not only is the Eurozone debt crisis no closer to resolution, but the attempts to solve it are pushing the region deeper into recession.

According to Eurostat, the Gross Domestic Product (GDP) for the 17-nation Eurozone plunged 0.6% in the final quarter of 2012, a steeper drop than the 0.4% economists had expected and the worst decline since 2009.

It's the third consecutive GDP decline for the Eurozone, reaffirming that the area is mired in a recession that started with the 2008 financial crisis and has been exacerbated by the ongoing Eurozone debt crisis.

For all of 2012, the Eurozone economy shrank 0.5%, while the U.S. economy grew 2.2%. Even the GDP of beleaguered Japan increased 1.9%.

Most ominously, the GDP decline of the Eurozone's largest and strongest economy, Germany, mirrored that of the region as a whole, falling 0.6%.

Long one of the few bright spots, Germany is slowly getting dragged down by its weak neighbors, which include Italy, Spain, Greece and even France.

The bad GDP news also belies the sunny assessments recently delivered by many economists and EU leaders.

"These are horrible numbers, it's a widespread contraction, which does not match this positive picture of stabilization and positive contagion," Carsten Brzeski from ING told the BBC.

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Why Buying Silver Coins is One of the Hottest Trends of 2013

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So far in 2013, buying silver coins has been one of investors' favorite ways to profit from a climb in the white metal's price.

The demand for physical silver from small investors in the form of coins is really remarkable. A record 7.5 million ounces of silver coins were sold in January.

In mid-January, the U.S. Mint was forced to announce that it was forced to suspend sales of the 1-ounce American Eagle silver bullion coins because, after just two weeks, it was sold out of its entire inventory.

Silver bullion coin sales were strong going into the close of last year as investors became concerned over the state of the U.S. economy with Congress debating the fiscal cliff and the debt ceiling.

UBS noted, "With the U.S. Mint reporting notable sales volumes last November – when the U.S. held elections – and again this month when U.S. fiscal issues are at the forefront, it is easy to infer that some element of the 'fear trade' may be at play."

UBS was skeptical of the fear trade, but added "Nevertheless, it is important to keep an eye on U.S. coin sales in the coming months to see if volumes remain elevated as the debt ceiling showdown plays out."

Famous investor Jim Rogers is also a fan of buying silver coins.

"You can't get [silver coins]. They sell out," Rogers, who owns a rare 2013 silver coin, said on Yahoo! Finance's"The Daily Ticker" earlier this month. "Several mints have run out of coins because everybody's worried about the future of the world."

Are Insiders Signaling These Companies are Stocks to Sell?

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Recently Money Morning Chief Strategist Keith Fitz-Gerald pointed out that insider selling has been soaring of late. He pointed out that according to Vickers Weekly Insider Report the ratio of insider selling to buying by officers and directors stood at better than 9 to 1.

This is a level that has been predictive of near-term tops in the stock market and individual investors need to be on alert for potentially falling stock prices ahead. While this indicator is not a precise timing measurement it is a red flag telling us that the people running publicly traded companies have concerns about valuation and prospects as we head deeper into 2013.

Insiders can tell us something about the potential performance of individual companies as well.

As far back as the mid-1960s Victor Niederhoffer and Jim Lorie combined on studies that showed insider cluster selling was predictive and indicative of lower prices over the next 12 months. Professor Nejat Seyhun of the University of Michigan has also done extensive research and concluded that when insiders sell in clusters it is likely that lower prices are ahead.

Given that insiders in the aggregate are warning of a market decline it is useful to take a look at which stocks are also showing warnings of lower prices ahead.

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What Should Apple Do with its $137 Billion Stockpile of Cash?

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Apple Inc.'s (Nasdaq: AAPL) been in the news a lot of late as its stock plunged. Meanwhile, the company sits on a cash pile of $137 billion.

When Apple stock was soaring, investors were happy. But since its stock value plunged some 35% since September, many investors have suggested Apple should share some of itsaccumulated wealth. Fund manager and investor David Einhorn went so far as to sue the company to try to force it to share more of its cash with shareholders.

Money Morning Chief Investment Strategist Keith Fitz-Gerald was asked on FOX Business what Apple (Nasdaq: AAPL) should do with its stockpile of money: Should the company pay dividends to shareholders, pursue major acquisitions or just keep its large cash position for future investments or other costs?

Check out what Fitz-Gerald and other panelists said on the FOX Business report in this accompanying video.



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Bear of the Day: J.C. Penney (JCP) - Bear of the Day

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This turn-around may take a little longer than expected. Is now the right time to take risk on in this struggling retailer? PENNEY (JC) INC (JCP): Free Stock Analysis Report PENNEY (JC) INC (JCP): Free Stock Analysis Report To read this article on Zacks.com click here.

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Buy, Sell or Hold: Is Microsoft Stock About to Break Out of Its 10-Year Slumber?

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Microsoft Corp. (NASDAQ: MSFT) is the world's largest software company. It's also the world's largest afterthought for most investors.

"It's an ancient relic," they say, "Apple and Google are the only games in town."

Or there is always this complaint: "Microsoft has no attractive products and there is no growth"…blah, blah, blah.

This ongoing apathy is one of the reasons why Microsoft stock has been stuck in the doldrums for years.

But if you are willing to look a little deeper, you'll discover this sleeping giant is coming out of its long slumber – and it's hungry.

Don't get me wrong, I'm not going to try and convince you that Microsoft is ready to change its stripes and become a full-scale growth company. Microsoft is what it is – the seller of the market-dominant PC operating system, Windows, and the seller of the market-dominant workplace productivity software, Office.

However, it does have the potential to become a major competitor in future growth markets like smartphones, tablets and enterprise solutions.

Why Some of the Best Investments for 2013 Come from this Region

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With low growth forecast in the United States, some investors have headed beyond U.S. borders in search of the best investments for 2013 – and landed in Latin America.

Latin America's largest economies, like Brazil, aren't the ones that will be delivering the biggest stock gains this year. As measured by the iShares MSCI Brazil Index Fund (NYSE: EWZ), equities in the region's largest economy are extending last year's glum pace as the exchange-traded fund (ETF) is off nearly 2% to start the year.

But while economies like Brazil and Argentina might not offer the best investments for 2013, there are some "unsung gems" that will deliver.

Here are some of the most promising Latin American names, both on the equity and debt fronts, that investors should consider this year.

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Apple iWatch, Google Glass First Shots in New Clash of Tech Giants

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Coming less than a year after Google unveiled its Google Glass Web-connected eyeglasses, reports that an Apple "iWatch" is in the works emphatically confirm that the battle is now joined for dominance over the next wave of tech – wearable computing.

According to the reports, Apple Inc. (Nasdaq: AAPL) has 100 people working on an iWatch users would wear on their wrists, but that would have many of the same capabilities as an iPhone.

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