Investing
The economy is in a slow period, and bankruptcies are making headlines. So, lately, I’ve been fielding a lot of questions about the pecking order investors assume when a publicly traded company goes into bankruptcy.
As Tony Robbins says, you don’t have to know how electricity works. All you need to know is how to flip the switch to get the light to come on...
Answer me this: Why have Exxon Mobil and some of the other oil majors been spending more of their cash on share buybacks than on exploration and production?
As a stock or bond holder, you are part owner of the corporation whose stock or bond you hold. So what happens if that company goes into Chapter 7 bankruptcy?
Economists really stink at predicting one of the most important events they track: Recessions. A recent study of 60 recessions that hit various countries in the 1990s found that only 3 percent of "consensus forecasts" (as they’re known in financial circles) made by groups of economists correctly predicted one of those recessions a year in advance. And when they did see one coming, they underestimated its severity by a long shot.
Commodity prices (especially oil, gold, and silver) have been falling sharply since July 15. Unfortunately, prices at the producer level and the consumer level are still rising.
Invest in strong sectors. Avoid weak ones.
This seems obvious, yes? But too often, people invest in weak sectors and avoid strong ones. Here are some of the culprits behind this backward thinking:
"As the baby boomers retire, will the selling of their 401(k)s for retirement income have a downward effect on the stock market for many years to come? At 52, I don’t want to take another major hit. What will happen to the stock market as the population ages? I feel I have all my eggs in the same basket as everyone else."
The longer I invest, the more I realize that simple investing works best. The fewer rules you have, the better.
Simple investing should be a natural outgrowth of having more knowledge and a better understanding of how investing works. Your ability to pick out what’s truly important and what works for you is key.
“I can understand the prices of oil, precious metals, food, etc. going up when the dollar is devalued - but how does that reconcile with housing and stock prices going down?”
The retail sector has been performing very poorly over the last year. The problems in the credit market have had a huge impact on the spending habits of consumers, and retailers have struggled as a result.
Wilbur Ross is a multi-billionaire and legendary investor. He made his money by buying hated assets - like steel when nobody was touching it and Japanese banks when they were saddled with debt. (Sound familiar?)
Last year, eight out of 10 major sectors went up. The reverse is happening this year. Eight out of the 10 are now in negative territory. Materials and energy are the only holdouts. Is either one worth investing in? Or are they just laggards that will be heading down any day now?
As recently as last November, Google was priced at over $700 per share. But the one-time Internet darling seems to have lost some of its allure.
When an economy is growing fast, opportunities are abundant. You don't have to be a genius to make lots of money. You simply have to be at the right place at the right time.
We have all been there...
Sitting at a bar, head in your hands, you're wondering how it happened. How could your favorite stock have fallen so far, so fast? It looked so promising months ago. But here you are, sick to your stomach over it.
The government controls billions of dollars. That kind of power can make or break an industry. And the effect that an Obama presidency could have on pharmaceutical companies is one you should be aware of.
Australian government bonds have never looked better than they do right now. And this is the perfect time to jump into them...
What started last summer with news of credit problems and uncertainty in the mortgage industry has now claimed its first major bank. The FDIC took control of IndyMac Bancorp on July 13, in what is the third-largest bank failure in U.S. history.
Recession. It's the boogeyman of the economic cycle. And while many people dread these low points, our economy would be worse off without them. How could something so negative make a positive impact on the economy? It's simple.
You may remember the old acronyms for Ford: "Found On Road Dead" and "Fix Or Repair Daily." People used them to make fun of the reliability problems Ford had in the past. But they could also apply to Ford's stock in recent years.
When I started looking for ways to make consistent profits from the stock market, the first thing I learned about was technical analysis. With technical analysis, you use stock charts and various indicators to get a read for where a stock price might be heading.
Traders are mercenaries. They have no allegiance to the bullish side or the bearish side, only to the side that will pay the most money. This is the only way to be successful as a trader. Some of the more famous mercenary traders who played both sides of the market include Jesse Livermore, Bernard Baruch, and Joe Kennedy.
The world of exchange traded funds (ETFs) is ever-evolving. Nowadays, you can invest in a fund that covers just about any niche market. One that has caught my interest lately is the Claymore/MAC Global Solar Energy Index ETF, with the ticker symbol TAN. (Apparently, even Wall Street has a bit of a sense of humor.)
Many investors rely on stocks that offer dividend payments to supplement their retirement income. But how do you know that the company you're looking at will continue to pay out steady dividends?
Too Many Witches
by Rick Pendergraft (07/07/2008)
If you've spent some time in the investing world, you have probably heard the terms "triple witching" and "quadruple witching." But that doesn't mean you know what they are or why they should concern you as an investor.
As the U.S. economy continues to struggle, investors are looking abroad for investment opportunities. While most of the attention is on China and its growing economy, one of the best opportunities is in the Western Hemisphere.
Wall Street has its own less helpful spin on "live and learn." It's "read and retch." So much of what we hear and read from so-called experts is simply garbage. Worst of all, it can lead to bad investment decisions.
It doesn't matter whether we're in a recession or an economic slowdown (which falls just short of a recession). The main point is, the economy is hurting.
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