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Global Investing

Can Kuroda's New Round of "Easy Money" Finally Revive Japan?

By , Chief Investment Strategist, Money Map Report - • Print | Email

[Kyoto, Japan] – I think I hear the sounds of helicopter engines warming up in Tokyo.

Newly elected 2nd time Prime Minister Shinzo Abe has officially tapped Haruhiko Kuroda as the next head of the Bank of Japan and the financial markets here seem quite pleased.

Since rumors of his nomination surfaced in conjunction with Shinzo Abe's election campaign last November, the Nikkei has risen nearly 30%. But the Nikkei's rise is based on little more than hope and "Abenomics" – which is not unlike U.S. markets that have risen with each new infusion of Bernanke Bucks.

Unfortunately, disappointment is the more likely outcome when reality sets in.

It's not that there is anything wrong with Kuroda-san. He's aggressive and has a solid track record as president of the Asian Development Bank. Like many here he wants to ease monetary policy even further to stimulate the economy out of the hole it's dug for itself over the past 23 years.

I just question what "else" he possibly can do to fix it.

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Energy investing

The Next U.S. Shale Oil Boom Could Be in California

By , Contributing Writer, Money Morning - • Print | Email

The U.S. shale oil boom has hit Texas and North Dakota – and is now looking to take over the Golden State of California.

California's Monterey Shale formation covers 1,750 square miles from southern to central California and is believed to contain more shale oil than North Dakota's Bakken and Texas's Eagle Ford combined.

The potential of the Monterey Shale formation is enormous. According to IHS Cambridge Energy Research Associates, Monterey may hold about 400 billion barrels of oil – roughly half the amount of conventional oil that Saudi Arabia has.

The energy research director at IHS, Stephen Trammel, told CNNMoney, "Four-hundred-billion barrels, that doesn't escape anyone in this [oil] business."

Even if that is an overly optimistic estimate, there is enough recoverable oil there to make it worthwhile.

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Stock Market Today

Dow Hits Record High - What Does That Say About the U.S. Economy?

By , Money Morning - • Print | Email

Equity market cheerleaders got very excited about the Dow Jones Industrial Average hitting a new record high yesterday (Tuesday).

The Dow closed at 14,253.77, topping its previous record close of 14,164.53 on Oct. 9, 2007.

While it is nice to see a sign that equities are improving following the devastating shock of the financial crisis of 2008, today's Dow Jones Industrial Average is not the same index as it was in 2007.

In fact, if we look back at when the Dow Jones Industrial Average last exceeded 14,000, we'll see that the Dow seems to have less of a connection now to what is really happening in the economy than it did in 2007.

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Global Trends

Why Now Is the Time to Add Australia to Your Portfolio

By , Money Morning - • Print | Email

There weren't many developed countries that managed to dodge the worst of the financial crisis, but Australia was one of them.

With strong ties to over six billion emerging market customers yearning to adopt a more Western lifestyle, "The Land Down Under" has been left relatively unscathed.

And with interest rates that are above inflation and a veritable treasure trove of much-needed natural resources to rely on, Australia will enjoy prosperity for decades to come.

Unlike the rest of the West, what's going on there is a bona fide growth story.

In fact, according to the Economist's team of forecasters, Australia's GDP is expected to grow 2.7% in 2013.  Among the world's "rich countries" that's only behind the East Asian trio of Singapore, South Korea and Taiwan — all of which are expected grow at 2.9%-3% this year.

Australia is also doing significantly better than the other Western mineral-rich economy, Canada, which is expected to grow by 1.9% in 2013.

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Tech Investing

How to Become a Graphene "Wildcatter"

By , Defense + Tech Specialist, Money Morning • @Robinson_STI - • Print | Email

You've got a rare opportunity to be a high-tech "wildcatter" – thanks to a new miracle material that is destined to revolutionize just about any industry you can think of.

Medicine and biotechnology … electronics … energy … computers … they'll each be revolutionized by this new substance.

For instance:

Doctors will soon use it to create implants that will end brain disease…

Technologists will use it to take the power of 1,000 mainframe computers and hardwire it into your smartphone …

And biotechnologists will use this very same substance to work as "synthetic blood."

I'm talking, of course, about graphene – a substance that I like to refer to as the "miracle material" of the 21st century.

You see, I've been following this exotic new substance for some time now and am struck by the high level of interest you readers have in this unique form of graphite (which, of course, is the stuff that's in the tip of your pencil).

And these days, I get more comments and questions about graphene than I do on any other high-tech topic that I cover.

So today I'm going to tell you about two brand-new breakthroughs that will hasten graphene's arrival as a commercially viable substance.

And I'm also going to show you how graphene can put profits right into your pocket.

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Commodities

Why Junior Miners Are Struggling to Survive

By , Money Morning - • Print | Email

Junior miners, small mining companies still in the exploration or early production stages of mine development, are having an increasingly hard time raising sufficient funds to get their mines into production.

With companies quickly burning through their limited capital, Bloomberg News estimates that on average, junior mining companies have only 5.7 months worth of cash on their balance sheets, down 25% from last year. Unless smaller mining companies can raise more capital, they will be unable to fund ongoing exploration projects and will have to cease operations.

Mitchell Krebs, chief executive officer of Coeur d'Alene, told Bloomberg, "You will see a lot of companies hit the wall in 2013."

That makes them tempting targets for some of the bigger, well-financed mining companies such as Coeur d'Alene Mines Corp (NYSE: CDE).

If a junior miner sitting on a strong claim gets shut out of the capital markets, a well-funded buyer can acquire the company and its claim for a song.

"Everyone seems to be running away from it now and looking at selling off assets," Newmont Mining (NYSE: NEM) CEO Gary Goldberg said in a Bloomberg interview Feb. 25. "That's the time to look in the opposite direction from the herd to see what opportunities might be out there."

Hot Stocks

Stocks to Buy Now: Cash in on Dividend Growth in this Energy Subsector

By , Money Morning - • Print | Email

Income investors looking for stocks to buy in the energy space have had several prominent choices over the years.

Integrated names such as Exxon Mobil Corp. (NYSE: XOM) and Chevron Corp. (NYSE: CVX), for example, have lengthy dividend increase streaks, though neither fit into the high-yield category.

Royalty trusts and master limited partnerships (MLPs), two asset classes abundant in the energy sector, have surged in popularity in recent years mostly due to their large payouts and high yields. MLPs have also proven popular with conservative investors due to the predictable, prosaic nature of the oil and gas transportation business that leads to a steady stream of rising dividends.

But broadly speaking, the oil services subsector has been left out of the energy dividend conversation.

Oil services investors have had only a couple options within the sector when looking for dividend stocks to buy.

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Stock Market Today

Stock Market Today: With Dow at Record High, Will the Climb Last?

By , Contributing Writer, Money Morning - • Print | Email

The Dow Jones Industrial Average was at a record high after nearly six years, as the stock market today (Tuesday) rallied enough to push the index up nearly 70 points at the open.

Just minutes after the opening bell, the Dow sailed passed its all-time high of 14,165 hit on Oct. 9, 2007. Less than a half-hour into the trading session the Dow roared higher by triple digits propelling benchmark to yet another record.

By 1 p.m. the Dow was up 146.99, or 1.04%, at 14,274.81. The Standard & Poor's 500 Index added 17.32 or 1.14%, to 1,542.52, leaving it in striking distance if its record close of 1,565 hit in 2007. The Nasdaq climbed 43.39 or 1.37% to 3,225.42.

Money has poured into stocks over the last several months as individuals have begun to feel more comfortable about the health of the economy – but can it last?

"The question is, can the Dow maintain these levels? The market is interested in risk-that's why the Dow is higher, why the riskier currencies are higher," Matthew Lifson, currency trader at Cambridge Mercantile Group in Princeton told Reuters.

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Global Economy

Five Signs the Bull Market Is Getting Close to Topping Out

By , Associate Editor, Money Morning • @DavidGZeiler - • Print | Email

With the current bull market celebrating its fourth birthday by flirting with all-time highs, investors need to look hard for signs of where stocks are going from here.

Last week, the Dow Jones Industrial Average came within 20 points of its all-time record close of 14,164.53. Two weeks ago the Standard & Poor's 500 Index came within 31 points of its all-time high of 1,561.80.

Unfortunately, most market indicators are suggesting that the bull market that has carried U.S. stocks a long way from the lows of March 2009 is just about out of steam.

"There are a lot of measures that tell us markets are overbought at this point," Philip Saunders, head of multi-asset funds at Anglo-South African fund manager Investec, told the Financial Times. "Nothing goes up in a straight line."

That's not to say necessarily that we're facing a full-blown stock market crash, but that the likelihood of some sort of downturn has increased dramatically in recent months.

Many of the best indicators of a nearing change in the direction of stock markets are contrarian – that is, they appear to tell you the opposite of what you're currently observing.

But that's also what makes them valuable. No one wants to be the last person to leave the party, particularly when that party is a bull market.

Here are five indicators investors need to bear in mind:

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