"You know what the news is-- in a minute, you're going to hear the rest of the story"- Paul Harvey
For those of you who have not established a username and password for the newsletter link, I encourage you to do so soon. Several new features have been added as well as changes to the DG ETF top 10 list.
I am excited about our new stock lists. We have a list of growth stocks as well as a list of Under Loved, and Under Appreciated Value Stocks that could gain 200%-500% over the next 3-5 years.
Simply go to the newsletter link at the top of the page to sign up. The cost is free until the first of the year.
Here are some of our comments in the Newsletter this week;
"The news, or excuse for Friday's sell-off was on news that Dubai World's debt problems some how affect the debt problems we face in the U.S.. I believe the Dubai issue was concocted as a U.S. problem to distract investors".
"When I first heard of the Dubai build-out, my first thought was, "how are they going to make enough money to pay for all of this? And, who are the millions of consumers that are going to fly to Dubai (of all places) for a vacation? I can tell you that I would not be one of them".
Black Friday Baloney
"Am I the only one recognizing this, or have we seen ad after ad soliciting cash strapped consumers to sign up for debt consolidation services, and witnessed multiple news stories of home buyers being foreclosed on, and consumers filing for bankruptcy".
"For those still keeping their heads above water, the are watching TV programs like Dave Ramsey show (Fox) where he tells consumers to cut up credit cards, and only spend if you have the cash. Am I the only one recognizing the impact from this on consumer spending?"
Staying Focused on What Works
"If the economy is weak, and unemployment is high, consumers still need to eat, use energy to drive and heat their homes, need medicines, and sit home and surf the net for jobs or money saving/making ideas".
"As such, we need to remain nimble, and make changes to the portfolio that fit the current economic environment".
Today, the release of the Chicago PMI gave a short boost to the markets before sellers entered, and took prices down. After a 63% rise in the S&P 500 since March, investors are growing weary about corporate profits in the months ahead.
Clearly, the catalyst for taking profits came as word leaked out that department store sales are lagging optimistic forecasts after the Thanksgiving holiday weekend.
The National Retail Federation said more consumers were out shopping (looking or walking off dinner)) compared to last year, but on average they spent less.
Cost cutting has helped corporate earnings in recent months, but have not risen as much as stock prices and p/e multiples. The big question going forward is how can profit margins expand in light of a high unemployment rate, massive foreclosures rising, costs of energy and health care rising, and reduced credit availability? I don't think it can.
This being said, some stocks and sectors are still very attractive, and as long as consumers can get bargains, profits of some companies will continue to improve. Some stocks have been so severely beaten down, that they are trading below their book values. So, despite the rally, bargains do exist.
