Investment & Finance Thread (Apr. 20 edition)

Daily investment & finance thread ^ | 04/20/2014 | Freeper Investors

[expat_panama]

This is the thread where folks swap ideas on savings and investment --here's a list of popular investing links that freepers have posted here and tomorrow morning we'll go on with our--

 

Open invitation continues always for idea-input for the thread, this being a joint effort works well.   Keywords: financial, WallStreet, stockmarket.

Here's what others are saying about what's going on--

Gold / Silver / Copper futures - weekly outlook: April 21 - 25

Investing.com - Gold prices ended the week sharply lower on Thursday, falling below the $1,300 level as indications that the U.S. economic recovery is progressing dampened safe haven demand for the precious metal.

Gold ends week below $1,300 level on stronger U.S. economic outlook

On the Comex division of the New York Mercantile Exchange, gold futures for June delivery ended Thursday’s session at $1,294.90 an ounce. The precious metal ended the week down 2.34%. The Comex was closed for Good Friday.

Gold came under pressure after upbeat U.S. data on manufacturing and employment pointed to underlying strength in the economy.

The Labor Department reported the number of people filing for unemployment benefits edged up to 304,000, below analysts’ forecasts and not far from the six-and-a-half year low of 300,000 touched the previous week.  [more here]

Stocks Rebound After Nasdaq Selloff

By Philip Springer on April 18, 2014

U.S. stocks ended a holiday-shortened week with the Standard & Poor’s 500 making its biggest weekly gain in nine months. For the four days, the S&P 500 added 2.7 percent and both the Dow Jones industrial average and the Nasdaq Composite advanced 2.4 percent.

The weekly result is worth noting because it marks a strong turnaround after six weeks of turmoil that primarily affected overpriced information technology, biotechnology and other issues, mostly in the Nasdaq Composite.

By the end of last week, the bursting of that bubble was showing an increasing tendency for the selling to spread to the broad market. That hasn’t happened, at least not yet. In its reversal from an oversold condition, the market benefited from several developments... [more here]

--and IBD still hasn't announced this correction's 'follow-thru-day', although fwiw if we get more consolidation it might be as early as Tuesday...

[expat_panama]

—and this on a day that stocks seem to be pushing in to new highs. Like, the correction’s spent and we’re finally getting back into an uptrend...

[Lurkina.n.Learnin]

Was the volume up enough to call it a follow thru ?

[expat_panama]

volume up enough to call it a follow thru ?

Just in: "Stocks Rise In Higher Volume; Gilead Up After Hours" but they don't mention what the outlook is.  Guess we got to wait for today's Market Wrap when it comes out.

[Lurkina.n.Learnin]

Not yet

“But while the market rebound has been robust, there is still no clear confirmation of the current rally attempt. Market price and volume gains so far haven’t been strong enough to conclude that a shift in market direction has occurred.”

[Lurkina.n.Learnin]

A Closer Look at What S&P Sector Performance is Saying

http://finance.yahoo.com/news/closer-look-p-sector-performance-141515046.html

Food for thought.

[expat_panama]

a lot there, [bookmarking etfguide.com]

[expat_panama]

A lot going on --believe it or not.  Sure, yesterday's uptick was in higher volume but the trade level was only higher than the nowhere level the day before --still quite a bit below average.  IBD TV says we're still in a correction.  This morning we're looking at metals up and stocks slightly off.

Steady PMIs, sluggish China puts brakes on European shares European shares edged down on Wednesday after three days of gains as data showing China's economy was still stuttering offset some broadly reassuring European purchasing manager index (PMI) numbers. Data compiler Markit's monthly PMI figures, seen as good indicators of future growth, showed that while France's economy was still a…

Existing home sales hit slowest pace since 2012. Why analysts aren't worried. (+ ... Christian Science Monitor - 3:03am The US housing market has cooled over the past several months, hampered by high mortgage rates and (like everything else), an unusually bad winter.

Why Even $1M May Not Be Enough for Retirement - Rodney Brooks, USAT

Census Bureau's Pattern of Falsifying Stats - John Crudele, New York Post

Eric Holder's Subprime Shakedown Destabilizes Banking - Editorial, IBD

[catfish1957]

Interesting article on inflation in today's article listing. Doesn't take too many rocket scientist to figure that one out. Just visit WMT on any successive weeks. Prices are consistently going up, or package sizes are shrinking.

I see this accelerating this year, and it will finally get some traction of the news outlets.

Doesn't do the DJIA much good to go up 5% during the year if the CPI is rising 5-10%. CPI isn't showing that yet, but look out. (or watch the government fudge the #'s)

[Wyatt's Torch]

FUGLY new home sales numbers. Only a 9 standard deviation miss...

[Wyatt's Torch]

DAVID EINHORN: ‘We Are Witnessing Our Second Tech Bubble In 15 Years’
david einhorn

REUTERS/Brendan McDermid

David Einhorn.
Hedge-fund manager David Einhorn, who runs Greenlight Capital, says we’re seeing another tech bubble, CNBC reported, citing his fund’s quarterly investor letter.

“Now there is a clear consensus that we are witnessing our second tech bubble in 15 years. What is uncertain is how much further the bubble can expand, and what might pop it,” Einhorn wrote in the letter (PDF) posted online by @Levered_Hawkeye.

He continued: “In our view the current bubble is an echo of the previous tech bubble, but with fewer large capitalization stocks and much less public enthusiasm. Some indications that we are pretty far along include:

“The rejection of conventional valuation methods;
“Short-sellers forced to cover due to intolerable mark-to-market losses; and
“Huge first day IPO pops for companies that have done little more than use the right buzzwords to attract the right venture capital.”

In the letter, Einhorn writes that Greenlight is short some “high-flying momentum stocks” and “cool kid” companies that he’s dubbed the Bubble Basket.He explains that the basket approach allows him to make each individual short small in an effort to reduce risk.

The short positions weren’t disclosed in the letter.

However, the consensus on Wall Street continues to be that we are not in a tech bubble. Valuations aren’t as high, IPO activity isn’t as frenzied, and venture-capital funding isn’t exploding as it did a decade ago.

Earlier this month, Goldman Sachs put out a note giving six reasons we’re not in a tech bubble.

Unfortunately, it’s only after a bubble bursts that we realize we were in a bubble.

Einhorn, famous for his prediction of the Lehman Brothers collapse, also detailed a number of stocks in the letter that he’s long as well as some positions he exited during the first quarter of this year.

[Wyatt's Torch]

How not to invest (aka: FReepers saying the market is going to collapse as it rose 200%...)

[expat_panama]

...use this correction increase my position...  Brilliant! At this price, let's double it!

--which is exactly how I see the idea of buying 'on the dips'. 

Short term price swings by themselves are far too chaotic for market timing, but looking at longer term trends along with volume, econ reports, political sentiment, sector trends, we get much more of a fighting chance.  No way around it though, the pic does a darn good job of capturing a lot of common but avoidable market sentiment errors.  The good news is that ease of entry and exit of the marketplace tends to encourage resistance to that unfortunate chain of attitudes.

[catfish1957]

Loved that graph. Actually know some day trading idiots who pretty much follow this creed to the letter. Their comment? The system is biased against me.

[BipolarBob]

I appreciate the graph as well.

[BipolarBob]

Sold my SODA this morning. I’m happy. I’m looking at biotech for a spec.

[abb]

One of my coffee buddies this morning related that very same sentiment. A 72 year-old-retiree, who was told years ago by someone that “the market is rigged,” and kept his money in CDs. As a result his nest egg of probably less than a million (which ain’t bad), would be valued many-fold that amount had he fifty years ago systematically invested in equities.

[Wyatt's Torch]

AAPL announces 7:1 stock split

[Wyatt's Torch]

gap up:

[catfish1957]

Sounds a lot like my in-laws. they are quite a bit older than your coffee buddy, and lived through a small bit of the depression.

They did quite well, but I shudder at what they could have accomplished by even just moving 10% of their CD money to equities in the '50's to today.

And they are not alone. I am old enough to remember that 70-80% of those born at that time were ghastly afraid of the market, due to what happened in '29 and afterwards.

[catfish1957]

Hmmmmm ..... kind of could see this coming, as the shine has come off the apple. This screams two issues. (1) Sales projections may be lagging due to innovation lag. (2) Issue one has created a slight capitalization void.

I know AAPL has boat loads of cash, but things like rumors of rumors can even jar a stock price this lofty.

I think the folks there are a little worried, and how better to shore the Market Cap by generating a stock price that is affordable to the masses. Just think what would happen if BRKa would do a 1000:1 split