Press Esc to close

Welcome to Money Morning - Only the News You Can Profit From.

Close

Wednesday's "Earnings Beat" Makes This The Perfect "Bad-Market" Tech Stock

In last week’s Private Briefing report Our Experts Show You the Stocks to Pick in a ‘Stock-Picker’s Market’,” Money Map Press Chief Investment Strategist Keith Fitz-Gerald identified SanDisk Corp.(NasdaqGS: SNDK) as one of three stocks to buy in the face of the stock market sell-off.

And now we see why…

  • Featured Story

    Disastrous U.S. Jobs Report Pummels the Market

    Let's just say it: The May U.S. jobs report released today (Friday) was abysmal.

    American businesses in May added the smallest number of workers in a year, only 69,000 - less than half of the median analysts' estimate of 150,000.

    The unemployment rate unexpectedly ticked up from 8.1% to 8.2% as job seekers returned to the workforce, the Labor Department report revealed.

    In addition, revisions from previous months showed the economy gained fewer jobs in March and April than originally believed. March's employment numbers were reduced by 11,000 jobs to total 143,000, while April's plunged by 38,000 to total a lousy 77,000.

    The disappointing numbers cast doubt on the strength of the U.S. economic recovery, and also overshadow any evidence that the labor market is improving.

    The news sent the Dow Jones tumbling some 160 points on the open and more than 220 points by noon, with the other indexes following. While many traders were anxious to see May end, June hasn't started off in the right direction.

    "Yuck, this is really not good," Michael Mullaney, who helps manage $9.5 billion as chief investment officer at Fiduciary Trust, bluntly told Bloomberg News. "We're at a very precarious point right now as far as investors' psyche is concerned."

    To continue reading, please click here...
    Read More...
  • Double-Dip Recession

  • A U.S. Double-Dip Recession? Why George Soros is Wrong In an interview with Der Spiegel, investing legend George Soros says the Standard & Poor's downgrade of the U.S. credit rating means that it's more likely than ever there will be a U.S. double-dip recession.

    But here's the thing.

    He's wrong.

    As much as we respect Soros as an investor, barring an outside shock, a U.S. double-dip recession isn't in the cards. Not for now, at least.

    And we can prove it.

    To find out how, you need to read Martin Hutchinson's analysis in today's (Tuesday's) issue of Private Briefing.

    If you're a charter subscriber, just log in. If you're not, please click here.

    News and Related Story Links:



    Read More...
  • Sorry Mr. Bernanke: There Will be a Double-Dip Recession Despite what U.S. Federal Reserve Chairman Ben S. Bernanke said in his speech at the International Monetary Conference yesterday (Tuesday), it looks very much like we're headed for a double-dip recession.

    Indeed, the economic reports of the last week or so demonstrate that the U.S. job machine was never really jump-started after the Great Recession of 2008-09.

    The upshot: The U.S. economic recovery is stalling, and we're almost certainly looking at a double-dip downturn.

    Recessions are always painful - and double-dip recessions are even more so.

    And this second "dip" may be more of the same - a bloody economic downturn that leads into a feeble recovery with unemployment spiking to even higher levels than we're currently seeing.

    But there's a slight chance that this double-dip recession could prove quite productive for the U.S economy.

    Let me explain.

    To continue reading, please click here... Read More...
  • U.S. Economy Forecast: Five Ways to Profit in 2011 – Even With a Double Dip Recession It's been a dull year for the U.S. economy.

    But don't expect a repeat in 2011.

    In fact, as we enter the New Year for the U.S. economy, investors face some major risks. Should the U.S. Federal Reserve opt to maintain its record-low-level of interest rates, it's very likely that we'll see the kind of virulent inflation that will send commodity prices skyward, and inflict some real long-term damage in the process.

    With higher rates, the U.S. economy could experience its second downturn in three years, the kind of "double-dip" recession that would boost an already scary jobless rate - while also sending U.S. stocks into a bearish tailspin.

    With uncertainty the watchword for the New Year economy, U.S. investors need to position themselves to cash in should the currently anemic U.S. advance continue, while at the same time making sure to protect themselves against a potential downturn.

    As contradictory as that might sound, it is possible to do both.

    For top investment ideas for 2011, please read on...

    Read More...
  • The 10 Most Pressing Questions About the U.S. Economy – And Their Answers Will the economy lapse into a double-dip recession? What can be done about the soaring U.S. budget deficit? What's next for the stock market?

    These are just a few of the tough questions facing investors. And there may be no one better to offer answers, insight, and advice than Money Morning Contributing Editor Shah Gilani.

    A retired hedge-fund manger, Gilani has routinely been there to shepherd investors through blinding market uncertainty. He's used his contacts on Wall Street to give Money Morning readers the inside scoop on the collapse of American International Group Inc. (NYSE: AIG), the May 6 "Flash Crash," and most recently the "Mortgagegate" scandal that currently threatens to undermine the fragile U.S. recovery.

    Indeed, Gilani has been a tireless advocate for investors and a prescient market maven. That's why Money Morning's editors recently sat down with Gilani to talk about today's most pressing issues and discover what he expects for financial markets in the months and years ahead.

    In the partial transcript of that interview below, Gilani discusses why it's a good time to invest in stocks, what steps should be taken to fix the U.S. economy, and whether or not gold prices have peaked.

    In short, the U.S. government has failed the public as a matter of course, but there is still a way out of our current economic malaise and ample opportunity for investors to profit.

    To find out the answers to the ten most pressing questions facing the economy, read on... Read More...
  • Will The Fed Fall Back on Treasury Purchases to Fuel Economic Growth? Faced with a faltering recovery, the U.S. Federal Reserve today (Tuesday) will again consider ramping up purchases of Treasuries, a policy known as quantitative easing, to promote growth.

    The Standard & Poor's 500 Index closed yesterday with a 1.5% gain on speculation that the Fed would at least indicate to investors that it is prepared to take further action to support the economy.

    The Fed conducted its last major round of Treasury purchases from January 2009 to March 2010, buying $1.25 trillion in mortgage-backed securities and about $175 billion in debt owed by government agencies. The Fed planned on gradually reducing its balance sheet as the debt matured or was prepaid.

    But last month the Fed signaled it might resume its quantitative easing steps when it voted to reinvest the principal payments in longer term Treasury securities. And with little improvement in the U.S. economy since then, analysts think the central bank is preparing to take the next step.

    "The Fed's rhetoric will get the markets ready for the real possibility of expanding their balance sheet at a later meeting this year," Richard Clarida, a Columbia University professor and global strategic adviser for PIMCO, said Monday in a Bloomberg radio interview.

    Read More...
  • Why Investors Need to Pay Attention to These Emerging Markets The U.S. market showed improvement last week, but is still falling short of the continued growth and profit opportunities that emerging markets have to offer.

    Stocks inched higher on Wall Street over the past week, taking heart from news of a modest improvement in jobs and a narrowing of the U.S. trade deficit. Both acted to counter the argument that the U.S. economy is speeding for a cliff in a foreign-badged car.

    Bonds finished down slightly, crude oil rose 2.6%, and gold was down slightly.

    A tad dull, sure. But the fact that there wasn't a rout after the big gains of the first week of the month, though, has to be considered a win for the bulls.

    And some updates from the corporate world and overseas markets should keep investors cheering this week.

    To read why investors have reason to celebrate -- and what opportunities they can't ignore -- click here.

    Read More...
  • Three Ways to Brace for a Double-Dip Recession Economists are torn... Is the U.S. economy on the upswing? Or are we facing the dreaded "double dip recession"? Either way, there are a few things every smart investor needs to do now to protect their nest eggs. Find out what you should do in this free report. Read More...
  • Question of the Week: Government Intervention in the U.S. Housing Market Does More Harm than Good Experts fear that the already-battered U.S. housing market is getting ready to stall again, leaving the Obama administration to decide what - if anything - it should do next.

    Standard & Poor's Case-Shiller Home Price Indices reported last week that home prices rose 3.6% in the second quarter from a year earlier - but the boost came from the first-time homebuyer tax credit that expired in April. And that doesn't bode well for the housing market's near-term outlook.

    "The numbers were inflated by the homebuyer tax credit," David Sloan, a senior economist at 4Cast Inc. in New York, told Bloomberg. "The numbers will be going down in the coming months. We could see some significant declines."

    Read More...
  • Obama Floats $350 Billion Stimulus Package to Re-Ignite Economy Faced with pre-election polls showing strong Republican support leading up to the mid-term elections in November, President Barack Obama is floating a $350 billion stimulus package designed to assuage the fears of troubled homeowners and create jobs.

    In another move aimed at stabilizing a shaky economic recovery, the president today (Wednesday) will officially unveil a new $200 billion tax cut that gives businesses across the country incentives to buy new equipment, an anonymous administration official told CNN.

    The proposal would be in addition to a $100 billion permanent extension of the business tax credit for research and development, as well as a $50 billion six-year program to fix roads, railways and runways and modernize the air-traffic control system.

    Read More...
  • Stock Market's Rally A Salute to Slow Growth The markets staged a relief rally last week that reflects Wall Street's attitude about the overall economy. Simply put, investors are saying they can live with slow growth, so long as the U.S. can avoid a double-dip recession.

    Stocks leapt around the world last week like jets of water shooting out of a fountain that had been closed down for weeks. The major U.S. indexes rose 3%, the NASDAQ rose 4%, non-U.S. foreign big-caps rose 3.6% and small-caps rose 4.6%.

    Many of our plays on growth overseas rose even more: iShares MSCI Thailand Index Fund (NYSE: THD) jumped 4.9% and iShares MSCI Chile Investable Market Index Fund (NYSE: ECH) rose 4.4%, while iShares MSCI Singapore Index Fund (NYSE: EWS) rose 3.2% and iShares MSCI Turkey Index Fund (NYSE: TUR) rose 3.5%. Once again, as we have seen all year, the response in iShares FTSE/Xinhua China 25 Index ETF (NYSE: FXI) was more muted, up 2.4%.

    Read on to see where the next turning point for the market will come...

    Read More...
  • We Want to Hear From You: Should the U.S. Government Offer More Incentives to Help the Housing Market? Experts fear that the already-battered U.S. housing market is getting ready to stall again, leaving the Obama administration to decide what - if anything - it should do next.

    Standard & Poor's Case-Shiller Home Price Indices yesterday (Tuesday) reported that home prices rose 3.6% in the second quarter from a year earlier - but the boost came from the homebuyer tax credit that expired in April. And that doesn't bode well for the housing market's near-term outlook.

    "The numbers were inflated by the homebuyer tax credit," David Sloan, a senior economist at 4Cast Inc. in New York, told Bloomberg. "The numbers will be going down in the coming months. We could see some significant declines."

    Read More...
  • Can the Obama Administration's New Stimulus Plan Revive the Housing Market? Worries about the sorry state of the U.S. economy have officials from the Obama administration digging deep into their bag of tricks to stop the skid before it slips into a double-dip recession.

    Their latest move was announced Sunday when Housing and Urban Development Secretary Shaun Donovan said the White House plans in the next few weeks to set up an emergency loan program for the unemployed and a government mortgage refinancing effort.

    Despite all the monetary and fiscal firepower the U.S. Federal Reserve and the Treasury have deployed, economic growth has slowed to an agonizing pace. The slowdown has hit the housing market particularly hard, as evidenced by home sales that dropped to record lows in July.

    Read More...
  • Three Ways to Brace for a Double-Dip Recession: Recession-Proof Stocks Today (Friday) we conclude our series on bracing for a double-dip recession.

    In Part I of this investment series, "Three Ways to Brace for a Double-Dip Recession: Going for the Gold," we discussed ways investors could safeguard against the imminent decline of the U.S. dollar by buying gold.

    In Part II, "Three Ways to Brace for a Double-Dip Recession: Going Global," we explored potential investments in foreign countries that have more stable economies and better growth prospects.

    And today, we're going to conclude by looking at "recession-proof" stocks right here in the United States.

    Read More...
  • Three Ways to Brace for a Double-Dip Recession: Going Global The last time the U.S. economy suffered through a double-dip recession, this country was struggling to overcome the fallout from an Arab oil embargo, Vietnam War-era deficits, and an inflationary spiral that just wouldn't let go.

    That 1981-82 double-dip downturn - the result of an economic "shock treatment" aimed at curing those ills - consisted of two recessions that were separated by a single quarter of growth.

    The current backdrop is very different from the one that was in place back then, but the threat of a double-dip recession is no less real.

    The world's No. 1 economy lost 8.4 million jobs during the recession that got its start in December 2007, making it the worst national downturn since the Great Depression and the biggest loss of employment since the end of World War II.

    Read More...
  • Three Ways to Brace for a Double-Dip Recession: Going for the Gold The last time the U.S. economy suffered through a double-dip recession, this country was struggling to overcome the fallout from an Arab oil embargo, Vietnam War-era deficits, and an inflationary spiral that just wouldn't let go.

    That 1981-82 double-dip downturn - the result of an economic "shock treatment" aimed at curing those ills - consisted of two recessions that were separated by a single quarter of growth.

    The current backdrop is very different from the one that was in place back then, but the threat of a double-dip recession is no less real. Indeed, with each passing week, and with every new economic report that comes out, the possibility that the U.S. economy will backslide into a double-dip recession seems to become more of a probability - or even a likelihood.

    "For me a 'double-dip' is another recession before we've healed from this recession [and] the probability of that kind of double-dip is more than 50%," Robert Shiller, professor of economics at Yale University and co-developer of Standard and Poor's S&P/Case-Shiller home price indexes, told Reuters. "I actually expect it."

    Read More...