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Opinions expressed here are those of J. F. Phillips, a total amateur and may be entirely
inaccurate and off the mark. Do not trade on the basis on these opinions. They are mostly
for entertainment purposes and for those curious about what goes on in the mind of J. F.
Phillips. Always seek professional advice and independent verification before making a
trade and remember...J. F. Phillips may have positions in the underlying investments
mentioned. This sure as hell is not an offer or solicitation to trade in anything!
COSMIC INVESTOR·°. MARKET NOTES...
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continue to check back here throughout the day for late breaking comments
NOTE:
Along with the obvious sham charities that prey on tragic times,
there are legitimate corporations, banks, radio stations, religious
groups and the like that would love for you to give them your
donations. Oh yes, eventually those donations may make their way
to some credible work...but meanwhile they will sit in the collector's
bank account earning interest for the collector. MIGHT BE BEST TO DONATE
MONEY TO THE FEDERAL GOVERNMENT THE WAY THINGS ARE GOING!!! Heads up out there!
Monday, October 24, 2005
IS ANYBODY OUT THERE?
I hate it when I return to an interesting website only to find it hasn't changed
any in the passing months or that it has been discontinued altogether...yet that
seems to be the case with my own website!
Where have I been? Right here, not doing much. I've been trying to find stocks I
can hold for the long term. My favorite had been FORTUNE BRANDS (FO) but I recently
sold it. Its share price had been slipping and it finally dawned on me that FO has
a huge exposure to the hard liquor market and that hurrican Katrina really put a hurt
on New Orleans. Any idea how much hard liquor is consumed in New Orleans? Quite a bit
I would think, so no wonder FO's share price has been falling.
I sold my Fortune Brands stock and put it all into GOOGLE (GOOG). That was back around
October 10, 2005. I sold FO at around $77.73 a share and bought GOOG at around $311.10 a
share...right before the big earnings release and the accompanying sky rocketing rise in
GOOG's share price. In fact, I estimate I made back anything I might have lost by selling
stock to buy GOOG.
GOOGLE is now my favorite long term holding. Sorry I didn't give anybody a heads-up on my
impending sale of FO and purchase of GOOG but I feel any sell off in GOOG is still a sound
buying opportunity.
Tuesday, February 17, 2004
INTO THE NEW YEAR
Under the Bush economy, NASDAQ has remained less than half its average under Clinton,
but the Dow Jones Industrials have done rather well. This means, large companies with
oil, gas and chemical interests and defense contracts have done well but bright, new,
innovative companies have suffered. Gold stocks have also done well under Bush since
the world feels the end is near with this beady-eyed bozo running things.
It's clear to me, Bush never was popular. He "won" the 2000 election by the thinnist
of margins. He's even less popular today. John Kerry should have no problem defeating
him in November. If Bush does manage to pull another 2000, I would expect war in the
streets, hence buy more gold stocks. But with Kerry in the White House, I hope to see
more gains for ordinary NASDAQ type companies.
Many NASDAQ companies, and investors, are already anticipating a Kerry victory. I have
sold my Ford (F) and Goodyear Tire (T) stocks and invested in Electroglas Inc (EGLS),
Intrusion Inc (INTZC) and Kimco Realty Corp (KIM).
I also still like day trading Coeur D'Alene Mines (CDE) and I am still holding my
shares in Ameritrade (AMTD).
Below are notes I made to myself, which I am sharing here.
WHAT I CALL STEADY GROWTH STOCKS:
North Fork Bancorp (NFB) Mangement Buying Tons of Shares, Expects New Growth From Expansion
Fortune Brands Inc (FO) Earnings Up 20%, Solid Name Brands, Small Dividend, Expects Double
Digit Growth
American Capital Strategies Ltd (ACAS) Solid Chart, Dividend but May be Interest Rate
Sensitive
Kimco Realty Corp (KIM) Nation's No. 1 Shopping Center REIT, Earnings Up 29%, Modest
Dividend, Solid Chart
Emerson Electric Co (EMR) Strong Volume, Modest Dividend, Continued Upturn Seen
Piedmont Natural Gas Inc (PNY) Strong Volume, Nice Dividend, Modest Insider Buying
WHAT I SEE AS STOCKS RISING FROM THE BOTTOM:
Intrusion Inc (INTZC) Still Has Loss but Revenue Up 26% From Last Q, 34% From Year
Ago, May Have Hit Bottom
Electroglas Inc (EGLS) Strong Volume, Sees Continued Upturn
STOCKS I THINK ARE POISED FOR GROWTH:
American Retirement Corp (ACR) Solid Future but No Dividend
Cornell Companies Inc (CRN) Anticipates Bright Future
DTE Energy Co (DTE) May Go Lower Near Year's End
Priceline.Com Inc (PCLN)Lower Costs, New Services, Showing Profit
Sandisk Corp (SNDK) Lots of Analysts Bad Mouthing SNDK but Strong Insider Buying,
New Products.
SBA Communications Corp (SBAC) Enormous Share Buying By Capital Firm, Plans for the Future
Sizeler Property Investors, Inc. (SIZ) Modest Revenue Improvements, Solid Insider Purchase,
Hefty %7 Dividend Rate
Talk America (TALK) Total Revenue Up 24%, Business Growing, Expanding, Big Insider Purchase
ValueClick, Inc. (VCLK), Revenues Up 61%, Company is Optimistic For Year, Large Insider Buy
Vitesse Semiconductor (VTSS), Revenues up 39%, Some Favorable Analyst Reports, Sizeable
Insider Buys
STOCKS I LIKE FOR DAY TRADING:
Aetrium Inc (ATRM)
Compudyne Corp (CDCY)
Savvis Communications Corp (SVVS)
Forbes Medi-Tech Inc (FMTI)
Hartmarx Corp (HMX)
Centex Corp (CTX)
Coeur D'Alene Mines (CDE)
IN MY OPINION, HIGH RISK, HIGH REWARD PLAYS:
Incyte Corporation (INCY) Strong Chart, Volume, Strong Analyst Report
Kmart Holding Corp (KMRT) Strong Inventory Management, Reducing Unprofitable Moves,
Sees Profit Short Term
Midway Games Inc (MWY) Last Quarter Revenues Down 78%, But New Report Due Feb. 25,
May Be Moving Up Again Midway Insider Buying; Hundreds of Thousands of Shares Purchased
by Sumner M. Redstone
Mayor's Jewelers (MYR) 41% Increase in Net Income, May Have Some Cumulative Dividends
Problems but May Have Hit Bottom. Company was Formerly Jan Bell Marketing, had to end some
472 concession sites at Sam's Club in 1993, causing a huge sell-off of the stock. Was trading
around $12 a sh, dropped to around $7 a sh after Sam's Club agreement ended. Company has been
restructuring itself (CLICK HERE). Canadian Henry Birks supposedly owns 72% of company. Mayor's
seems happy with the arrangement, hoping Birk's expertise will rescue it. His Preferred Stock
will convert into 58% of the common stock as I understand it. Mayor's now runs 28 luxury
jewelry stores in FL and GA.
Optical Cable Corporation (OCCF) Shares Were Trading in $60 - $100 range until Fall 2001.
In 2001 OCCF got hit with a shareholder class action lawsuit (CLICK HERE) and with a race/
gender lawsuit by the U.S. Federal Government EEOC(CLICK HERE). The shareholder lawsuit was
supposedly settled in Fall 2002 (CLICK HERE). As of January 14, 2004, mangement said, "We
remain cautiously optimistic about future net sales and have seen some preliminary signs
our markets are firming. However, it is still unclear when our markets will begin to show
sustainable growth," CLICK HERE.
Penn Treaty American Corp (PTA) Dropped from $20 - $30 a share to under $2 a share on
investor class action lawsuit CLICK HERE for not having enough reserves but PTA seems to
have settled the lawsuit and has raised enough capital to cover reserves and is being
allowed to recompense business in several states including California (CLICK HERE), and
officers have bought modest amounts of company's stock (CLICK HERE).
Questcor Pharmaceuticals (QSC), "acquires, develops, markets and sells brand name
prescription drugs through a U.S. direct sales force and overseas distributors and
marketing partners." Has $83 million accumulated deficit, but price shot up 18% to
$0.93 a share Feb. 13 on hopes that its newly acquired product, Nascobal, is progressing
well (CLICK HERE).
Home Insider Trades Editorials Statistics Interesting Web Sites Mututal Funds
Monday, August 11, 2003
I HAVE CASHED IN MY AWA SHARES
Last week I decided to sell my
AMERICA WEST (AWA) stock.
The share price had had a phenomenal
runup and lately has been steadily falling.
The fall, I believe, is due to profit taking,
panic selling and most importantly, IMO, the
renewed fears of airline security and terrorism.
Added to this is the weak July traffic report
(CLICK HERE) and the traditional slow period
for airlines that follows the end of summer vacation,
usually on Labor Day.
To be sure, there is also some strong buying
going on for AWA shares and this is creating
a fine short-term, day trading opportunity for
those with the nerves for it. I sold on a recent
anticipated rally at around $7.51 a share.
I took much of the proceeds and bought more
GOODYEAR TIRE (GT) shares at around $5.19 a
share. I think GT is still a bargain in the
$5.00 a share range.
Monday, May 26, 2003
BANK OF AMERICA CHAIRMAN DUMPING SHARES
According to Yahoo! Finance Insider & Form
144 Filings, BANK OF AMERICA (BAC) Chairman
Kenneth Lewis is planning to sell 228,572
shares of BAC stock, worth an estimated
$13,714,320 (CLICK HERE).
BAC's share price does appear to be peaking
at it's 10+ year high of $74.00 a share and
more worrisome is the effect deflation may
have on bank stocks in general.
The U.S. dollar is very weak overseas which,
in my opinion, means Europeans don't much
care to buy American goods so U.S. companies DELATION MAY HURT BANKS
are having to slash prices.
With lower prices, companies are less willing
to pay higher loan rates. If inflation causes
bank rates to rise, then deflation causes
bank rates to drop and every investor knows
(or should know) low rates hurt banks' Net
Interest Margin (the spread difference between
the interest banks pay on deposits compared
to the interest banks charge for loans).
Thursday, May 01, 2003
FIRST QUARTER UPDATE
I've been away the last few months a NEW COSMIC INVESTOR WEB LINKS:
bit dispondent over the gloomy attitude
many investors have regarding my efforts Scroll down Cosmic Investor home
to educate them. Why bother, I often page to OTHER NEWS SOURCES for
wonder. Well, I'm rolling up my shirt links to THE CHARLOTTE OBSERVER
sleeves and once again pontificating on and HOUSTON CHRONICLE as regional
the markets. adjuncts to The New York Times,
Los Angeles Times and Chicago
I sold my gold mining stocks and moved Sun Times.
into more traditional blue chips such
as SEARS (S) and FORD MOTOR COMPANY (F) I like The Charlotte Observer
and my longterm favorite, AMERITRADE (AMTD). for its ease of access and
recent coverage of The Dixie
As for gold, I think it is still fine for Chicks and feel the Houston
short-term trading due to the SARS scare, Chronicle is more independent
a possible U.S. war with Iran and Syria, The Dallas Morning News.
European backlash against U.S. businesses,
a weakening U.S. dollar and rising U.S.
deficits but I don't see much longterm
profits to be made anymore from gold. Just
my opinion. The big fear of possible hugh
U.S. losses in a war with Iraq as well as
serous terrorist reprisals are no longer
valid to many investors, so gold is moving
on economic news.
For the present I would keep my eyes on
SUN MICROSYSTEMS (SUNW) and AMERICA WEST
AIRLINES (AWA).
I have been following AWA for several months
and like its performance. It deals exclusively
with North America, some 59 desinations in U.S.,
Canada and Mexico so may not be as effected by
terroism and SARS. It also runs a well regard
travel agency that together with its airline
operations offers solid vacation packages.
Inside Flyer Magazine recently awarded AWA the
"Freddie Award" for best Elite-Level frequent
flyer program based on some 250,000 frequent
flyer voters (CLICK HERE).
AWA was also recently upgraded by Deutsche
Securities and there has been some stong
insider buying of its stock by Par Investment
Partners, L.P. (CLICK HERE).
I believe once the economy fully recovers and
people start taking nicer vacations, AWA's stock
price could easily hit above $10 a share.
Now as for SUN MICROSYSTEMS (SUNW), I think it's
stock price looks great at the $3.00 a share
range but it may full further. There is still
solid insider selling even in the $3.00 a share
range and SUNW will probably lower prices to
attract more customers. So, I think it's worth
following and worth considering a purchase at
around $2.50 a share.
Well, be in touch later!
Wednesday, February 05, 2003
UPDATES ON PLP, GOLD AND GOODYEAR TIRE
PHOSPHATE RESOURCE PARTNERS LIMITED PARTNERSHIP (PLP),
reported here on January 01, 2003, will not make a cash
distribution for the quarter ended December 31, 2002
(CLICK HERE).
And CLICK HERE for PLP's recent 2002 4TH Quarter
and full year results.
Furthermore, while some PLP investors remain
bullish about DAP (di-ammonium phosphate,
used in common fertilizers) prices will rise,
another major producer (Australian firm, WMC
RESOURCES LTD (WMC) saw DAP prices fall below
US$150 a ton during the fourth quarter and
expects prices to "stay around these levels,"
as demand from China slackens and world
supplies increase. Some U.S. producers (PLP???)
may even quit the business (CLICK HERE FOR
ARTICLE).
GOODYEAR TIRE AND RUBBER (GT), mentioned here
November 21, 2002, has recently decided to
stop paying dividends (CLICK HERE FOR DETAILS).
I had foreseen as much and cautioned readers
to wait for GT to truly hit bottom before
bargain hunting its shares. IMHO, that time
is now.
GOLD PRICES are again moving up on fears of
a U.S. war with Iraq. Yet gold mining stocks
(the best way, IMHO, to play gold) haven't
gone much beyond their 52 week highs. Gold
mining share prices will probably spike
upwards as war begins but fall very quickly
as the war fails to linger. I'd say get out
the closer gold mining stocks approach their
52 week highs. In fact I sold my COEUR
D'ALENE (CDE) stock at the first of the year
and bought into GT and AMERITRADE (AMTD).
I paid through the nose for both. I knew
they would fall in price but I didn't want
anyone accusing me of driving down the
market by not buying. Okay? I did my work,
the rest is up to you.
Thursday, January 23, 2003
SOME HIGH DIVIDEND STOCKS
UPDATED NOTE (THURSDAY, JANUARY 23, 2003: 7:30 p.m. EST)
I'm still holding THORNBURG MORTGAGE, INC. (TMA),
but believe it is interest rate sensitive in that
as rates drop more people refinance their exisiting
mortgages or take out new ones which helps TMA's
business. As rates rise, however, the opposite
occurs which may hurt TMA's business.
However, I believe that rates will remain low for
quite some time and that TMA's expansion plans will
help make up for any business that would happen to
drop.
Meanwhile I am keeping an eye on TECO ENERGY, INC. (TE)
since I feel it may drop futher as the economy worsens.
Thus, as the economy improves and interest rates rise,
TMA will probably drop and TE will rise, so I will at
some point switch from one to the other but right now
I think there is still money to be made on TMA.
**********************************************************
Recently I came across some high dividend yielding
stocks. What with the Bush administration push to
end "double taxation" on dividends and money market
funds yeilding a paltry 1.8% at most, a lot of investors
are shopping around for high dividend yielding stocks.
In fact, I have parked some of my "idle" in cash in one
of them, THORNBURG MORTGAGE, INC. (TMA).
TMA currently yields around 11.7% with its
$2.34 annual dividend payments.
TMA originates and acquires single family
residential mortgages. It generates income
for its investors based on the difference
between the yield on its portfolio and the
cost of its borrowings.
Many other investors think I'm crazy for
investing in this company during a time
of low mortgage rates but TMA stcok has
gone from around $16.49 in October, 2002
to around $20.15 just yesterday.
It also recently released its year-end
and Fourth Quarter results with stated
earnings-per-share for 2002 up over 24%
from 2001.
The Chairman called 2002 "a banner year," CLICK HERE FOR 4TH QUARTER REPORT
and the President said, "Our outlook for
2003 looks just as promising."
TMA seeks to become one of the top 50
mortgage lenders in the U.S. with a
15 - 20 percent increase in business during
2003 "even though total residential mortgage
originations in the U.S. are expected to
decrease by at least 25%."
TMA believes its business model is important
"to ensuring consistent earnings and dividends
over time" and has a stated objective of deliviering
"a 15% plus annual total return to shareholders
over time."
TECO ENERGY, INC., DIV. YLD., 9.38%
This came to my attention through a CBS MarketWatch
article on high dividend paying Fortune 500 companies.
TE is a holding company the owns all the stock
of Tampa Electric Company plus interests in
various gas utilities, power projects and even coal.
However, Fourth Quarter profit, reported yesterday, CLICK HERE FOR
fell 23% on debt refinancing charges and adjustment 4TH QUARTER REPORT
for the value of properties it is considering selling.
I know many TE investors are concerned about the
status of the dividend and trading for TE stock was
indeed halted before the market opened, and has received CLICK HERE FOR CBS MARKETWATCH
at least one down grade, but many people like its potential, ARTICLE ON HIGH DIVIDEND STOCKS
including Kelley Wright quoted in the aforementioned CBS
MarketWatch article.
TE, which was off almost 5% to close at $14.42 a share,
closed as high as $26.47 back in May, 2002 and as high
as $32.62 a share back in May, 2001. Guess some folks
feel at the $14.00 a share range, they might easily
double their money when the economy improves.
TORCH ENERGY ROYALTY TRUST (TRU), DIV. YLD., 21.7%
CAUTION: THIS COMPANY MAY CEASE OPERATIONS ANYTIME
AFTER MARCH, 2002 AND ADDED EXPENSES MAY LIMIT OR
CURTAIL ANY FURTHER DISTRIBUTIONS.
THE TRUST DEPENDS ON OIL, GAS, AND COAL DEPOSITS,
ALL OF WHICH ARE BEING DEPLETED.
Since TRU is a Trust, it technically doesn't have CALL 302-651-8775 FOR
earnings and its cash payments are called "distributions" MORE INFORMATION ON TRU
instead of dividends, thus it doesn't usually register
among most searches for high dividend yielding stocks.
I came across it by accident. And while it may cease
operations and/or distributions, I believe it has a
healthy trading volume of some 37,000 average shares
a day.
According to documents filed with the SEC,
The Trust was formed October 1, 1993 under the Delaware CLICK HERE FOR 4THQ
Business Trust Act. Torch and Velasco Gas Co. are DISTRIBUTION REPORT
owners of certain oil and gas properties (and apparently
some coal deposits) in Lousiana, Texas and Alabama.
Torch and Velasco created net profit interests and
conveyed such interests to Torch which then conveyed
them to the Trust in exchange for 8,600,000 units (or
"shares" as it were) which were then offered to the
public for trading via various underwriters cir: November,
1993.
As a Trust, Torch is therefore supposedly not subject to NEXT EARNINGS ANNOUNCEMENT
Federal income tax since the income, after having the IS FEBRUARY 17, 2003
company's general and administrative expenses deducted, is
divided pro rata among the unitholders (or "shareholders,"
as it were) who are then taxed normally.
Between Nov. 14, 2001 to Nov. 22, 2002 (if my math
is correct!), TRU paid out some $1.15 in income
distributions. The share (or "unit" as it's called)
price for TRU back around Nov. 5, 2001 was $5.58 a
share and it came down a bit from that a few days later.
But at $5.58 a share an investor would have collected
$1.15 in distributions, for a yield of 20.6% (again,
if my math is correct!).
This pretty much jives with the Yahoo finace page for
TRU which lists $1.11 in distriubtions for a yield
of 21.73 percent.
Friday, January 10, 2003
EARNINGS, THE DJIA AND MARKET BOTTOM
.......................................................................................
.
UPDATE: JANUARY 29, 2003
.
Since this report first appeared January 10, 2003 .
several new earnings reports have been issued making .
my estimated earnings per share for the Dow Jones .
Industrial Average stocks as $1.70 instead of my .
original estimate of $2.04 per share and my .
caluclated Price/Earnings Ratio for the DJIA is .
now 23.9 instead of my original calculation of .
20.82 (the 23.9 P/E is also more in line with .
Yahoo's finance page P/E average of 23.2). .
.
I still believe the DJIA will fall a bit more, while .
DJIA earnings on average must improve to around $2.72 .
per share (from my original estimate of $2.66 per .
share) to achieve a DJIA P/E ratio of 15. .
.
.......................................................
Originial text from Cosmic Investor, BreakAway Notes, January 10, 2003
Following the rising share price of My result was a P/E of 20.82, dviding the
AMERITRADE (AMTD) leads me to consider average DJIA price per share by the average
if the Dow Jones Industrial Average earnings per share.
(DJIA) has hit bottom.
A P/E of 21.59 would have to drop 30.5% to
Some of the tough old investor birds equal a P/E of 15; thus either the DJIA needs
out there have been waiting for the to drop 30.5% (to around 6,000!) or else the
collective DJIA price/earnings ratio DJIA earning-per-share (EPS) need to improve
to hit 14 - 15 before moving back into 30.5% to around $2.66 per share from my
the market. estimate of the DJIA current average EPS of
$2.04 per share.
I've wondered, since Microsoft and Intel
are now part of the DJIA and since neither I think it's more likely that EPS will improve
of them has ever had a P/E ratio much below 30.5% than the DJIA will drop 30.5%; in my
30, is it even reasonable to look for a humble opinion.
DJIA P/E of 14 - 15?
Many market watchers feel the first quarter of
According to last week's issue of Barron's, 2003 will see the last of poor earnings, with
the DJIA P/E is around 21.59; and a rough maybe a couple more big market sell-offs. The
calculation based on Yahoo finance pages market will probably hit bottom then.
yields much the same figure.
Get ready to load up on some bargains during
Apparently it based on year-end earnings those sell-offs. IMHO.
for the underlying DJIA stocks.
Below is my table of the DJIA stocks, their
Now, I'm no financial analyst wiz but I past four quarterly earnings-per-share and
have painstakingly gone through the 30 Thursday afternoon's share prices. I claim
stocks making up the DJIA and listed their no competence in this. Earnings are for the
reported earnings for the past four quarters. most part diluted and reflect any charges.
I added them up, took their average and
divided that into Thursday morning's average I tried to list the oldest earnings first.
DJIA share price. Some companies have already issued 4thQ
earnings but for convenience I list them
all as:
(4thQ-2001) (1stQ-2002) (2ndQ-2002) (3rdQ-2002)
THE DOW JONES INDUSTRIALS: QUARTERLY EARNINGS, P/Es AND RECENT SHARE PRICES
Ticker 2001 2002 2002 2002 Total Mid Day P/E
Symbol Company 4thQ EPS 1stQ EPS 2ndQ EPS 3rdQ EPS EPS Sh. Price Ratio
AA Alcoa $0.40 $0.26 $0.27 $0.23 $1.16 $ 22.35 19.27
AXP Am. Express 0.23 0.47 0.52 0.52 1.74 38.19 21.95
T AT&T -0.39 -0.28 -3.49 0.06 -4.10 27.62 0.00
BA Boeing 3.26 -1.56 -0.59 -0.12 0.99 33.91 34.25
CAT Caterpillar 0.59 0.23 0.58 0.61 2.01 47.01 23.39
C Citigroup 0.61 0.93 0.78 0.76 3.08 37.43 12.12
KO Coca-Cola 0.06 0.02 0.47 0.42 0.97 44.14 45.51
DD Du Pont 0.12 0.55 0.71 0.40 1.78 44.30 24.89
EK Eastman Kodak 0.33 0.13 0.97 1.15 2.58 39.95 15.48
XOM ExxonMobil 0.46 0.30 0.40 0.39 1.55 35.44 22.86
GE Gen. Electric 0.39 0.35 0.44 0.41 1.59 25.82 16.24
GM Gen. Motors 0.60 1.39 2.63 -1.42 3.20 39.00 12.19
HON Honeywell -0.38 0.46 0.56 0.50 1.14 25.42 22.30
HPQ Hew. Packard 0.06 0.25 0.13 -0.67 -0.23 20.43 0.00
HD Home Depot 0.33 0.36 0.50 0.40 1.59 21.36 13.43
INTC Intel 0.78 0.45 0.07 0.10 1.40 17.21 12.29
IBM IBM 1.33 0.68 0.03 0.99 3.03 86.51 28.55
IP Int'l Paper 0.12 0.12 0.45 0.30 0.99 36.26 36.63
JPM J. P. Morgan 0.22 0.48 0.50 0.01 1.21 27.31 22.57
JNJ J'n & Johnson 0.49 0.59 0.54 0.57 2.19 56.74 25.91
MCD McDonald's 0.42 0.20 0.39 0.38 1.39 16.86 12.13
MRK Merck 0.84 0.71 0.77 0.83 3.15 59.89 19.01
MSFT Microsoft 0.40 0.47 0.44 0.23 1.54 55.59 36.10
MMM 3M Company 0.99 1.14 1.18 1.38 4.69 126.73 27.02
MO Philip Morris 2.88 1.09 2.30 4.34 10.61 41.20 3.88
PG Procter&Gamble 0.79 0.93 0.74 1.04 3.50 86.31 24.37
SBC SBC Com. 0.61 -0.02 0.55 0.53 1.67 28.97 17.35
UTX United Tech. 1.12 0.92 1.23 1.21 4.48 64.18 14.33
WMT WalMart 0.33 0.37 0.46 0.41 1.57 51.13 32.57
DIS Walt Disney 0.19 0.21 0.13 0.18 .71 18.16 25.58
Average Total EPS: 2.04
Average Share Price: 42.48
Average P/E (42.48/2.04): 20.82
CONCLUSION:
I don't think the high P/Es of Microsoft and Intel will have any real effect
on the DJIA hitting the traditional buy signal of a 14 - 15 P/E. A combination
of an improving EPS and a falling DJIA could find a happy medium whereby a P/E
of 14 -15 might indeed be achieved, probably in March - April 2003.
CLICK HERE FOR CURRENT DJIA
Wednesday, January 01, 2003
A STOCK TO WATCH:
PHOSPHATE RESOURCE PARTNERS
_________________________________________________
| |
| QUARTER, PHOSPHATE EARNINGS aprox. PLP |
PHOSPHATE RESOURCE PARTNERS, | YEAR PRICE/TON PER UNIT Unit Price |
LIMITED PARTNERSHIP (PLP) | 4thQ 2002 NA NA $1.70 | |
is a Limited Partnership which | 3rdQ 2002 $145.00 -0.01 2.25 |
trades on the New York Stock | 2ndQ 2002 135.00 -0.08 3.15 |
Exchange under the symbol PLP. | 1stQ 2002 134.00 -0.06 4.25 |
| |
As a general rule of thumb, | 4thQ 2001 123.00 -0.13 4.50 |
publicly traded limited | 3rdQ 2001 119.00 -0.18 4.50 |
partnerships consist of | 2ndQ 2001 132.00 -0.16 3.50 |
one general partner (the | 1stQ 2001 139.00 -0.12 3.25 |
corporation) and many limited | |
partners (the investing public). | 4thQ 2000 138.00 -0.11 4.00 |
| 3rdQ 2000 134.00 -0.09 4.00 |
This means investors will probably | 2ndQ 2000 130.00 -0.02 6.00 |
receive a Substitute Schedule K-1 | 1stQ 2000 132.00 0.04 6.50 |
from the company by which to determine | |
reportable income for tax purposes. | 4thQ 1999 131.00 0.03 9.00 |
There's usually plenty of easy to | 3rdQ 1999 156.00 0.07 10.00 |
understand instructions so it's not | 2ndQ 1999 168.00 0.23 10.00 |
as complicated as it sounds and many | 1stQ 1999 176.00 0.26 11.00 |
investors may end up not meeting the | |
various requirements needed to report | 4thQ 1998 180.00 0.32 11.00 |
anything. | 3rdQ 1998 182.00 0.26 10.00 |
| 2ndQ 1998 178.00 0.26 6.50 |
PLP is 51.6% owned by IMC Global, | 1stQ 1998 171.00 0.09 6.25 |
which itself trades on the NYSE under | |
the symbol IGL. IMC Global is the general | 4thQ 1997 175.00 -0.12 6.50 |
partner and provides administrative | 3rdQ 1997 175.00 -3.54 9.50 |
management all of which it assumed | 2ndQ 1997 176.00 0.30 11.50 |
when it merged with Freeport-McMoRan | 1stQ 1997 178.00 0.28 12.00 |
who was the old general partner of PLP. |_______________________________________________ |
Both PLP and IGL are involved in
producing, marketing and distributing
phosphate, most notably "diammonium
phosphate" (DAP) which is commonly used
as an argricultural fertilizer. Together,
PLP and IGL are among the world leaders
at this.
For the last few years, phosphate prices
have been dropping and so has PLP's stock
price but lately phosphate prices seem to
be headed upwards and so may be PLP's
stock price.
In the 2002 Third Quarter Report (dated Oct. CLICK HERE FOR THIRD QUARTER REPORT
24, 2002) Douglas A. Pertz, Chairman and
CEO of IMC Global said, "The third quarter
continued to support industry consultants'
forecasts that global phsophate market
fundamentals are in the early stages of a
multi-year recovery."
Back in late 1998 and early 1999 when
phosphate prices were around $176 - $180
per short ton, PLP's stock price often
closed at or above $11.50 a share, or
"unit," as it's called.
Near the end of August, 2002, Business Week
Magazine wrote favorably of the fertilzer
industry mentioning IMC Global and Scott's
Fertilizer as possible investment plays CLICK HERE FOR BUSINESS WEEK ARTICLE
I prefer PLP because at just blow the $2.00
a share range it is much cheaper than Scott's
or IMC Global. In fact it appears to be coming
off its 52 week low of $1.65 a share (unit).
PLP had been paying out a cash distribution
anywhere from $0.03 a unit to $0.30 a unit
but discontinued this in April, 2000 using
the money instead to repay loans to IMC Global.
Tuesday, December 17, 2002
NEXTEL MAINTAINS 2002 OUTLOOK
While the Dow, NASDAQ and tech stocks in general
have been tanking, NEXTEL COMMUNICATION (NXL) has
gone from a share price of $2.78 on July 02, 2002
to $12.82 Monday, December 16, 2002 (CLICK HERE
FOR PRICE HISTORY).
Outside players like Digital Radio LLC and Eagle
River Investment International LLC have tons of
planned sales on file but Chairman William E.
Conway, Jr. has been steadly buying shares as
have other key officers including a guy named
Craig McCaw (whom some may remember as a founding
father of wireless communications). (CLICK HERE
FOR INSIDER TRADE DATA).
This morning, December 17, 2002, the Reston,
VIrginia company announced it still expects
to add 1.9 million net subscribers for 2002
and is working with Motorola to double its
network's voice capacity and intends by the
middle of 2003 to have full nationwide two-way
"walkie-talkie" radio service (CLICK HERE FOR
NEXTEL OUTLOOK REPORT).
Thursday, November 21, 2002
GOODYEAR, INKTOMI MOVING OFF 52 WEEK LOWS
GOODYEAR TIRE AND RUBBER COMPANY (GT) has
had a spate of INSIDER BUYING lately, while GOODYEAR HISTORICAL PRICES
INKTOMI CORPORATION (INKT) had a spate of
INSIDER SELLING yet both appear to be moving
strongly from 52 week lows.
More or less, GT hit a low of $6.61 a share
November 1, 2002 while INKT hit $0.25 a share INKTOMI HISTORICAL PRICES
September 30, 2002.
As of 12:00 Noon EST, GT was at $7.50 while
INKT was at $1.26 a share.
I don't know about INKT, it may be riding the GOODYEAR FACES ABESTOS LAWSUITS
success of selling one of it's software lines
to another company for $25 million but I think
GT should drop in price next quarter on lower
sales and a possible dividend cut, plus possible GOODYEAR 3RDQ REPORT
abestos liabilities, analyis downgrades, and
pension contributions.
Meanwhile I look forward to COUER D'ALENE (CDE) INKTOMI UNIT BAGS $25 MILLION
topping the $2.00 a share mark during the next
six months on a U.S. war with Iraq. I will probably
sell it then.
AMERITRADE (AMTD)'s continued rise in share price
makes no sense to me other than the Chairman and
directors are probably still buying the stock.
Hold AMTD if you bought; buy it on dips probably
next quarter if you missed it the first time.
Tuesday, November 12, 2002
AUSPEX INVESTORS SAY, "BUY! BUY! BUY!"
Sometimes surfing publicly traded company
message boards can be interesting. To wit,
the AUSPEX MESSAGE BOARD at Yahoo is brimming
with praise and excitement for AUSPEX's stock,
trading around $0.30 a share.
There has also been some solid insider buying,
(CLICK HERE).
3RD QUARTER results reported a larger net loss
but also included a 13% gain in revenues, and
recently certified a device that can work with
StorageTek devices (CLICK HERE).
AUSPEX SYSTEMS (ASPX), according to its profile,
"Introduced the world’s first Network Attached Storage
(NAS) server over a decade ago. Today, Auspex continues
to play a visionary role in the industry, offering storage
solutions that far surpass that of the competition. As a
multinational corporation with offices in Europe, Asia,
Latin America and throughout the United States, Auspex
is there to meet the demands of the global business enterprise…
"With the highest scalability and fastest performance in the
industry, NS3000 network servers are used around the world for
storage applications requiring information consolidation,
secure Windows and UNIX data sharing from a single data image,
and continuous data availability."
CLICK HERE FOR AUSPEX HOME PAGE
Monday, November 4, 2002
ECONOMIA REPORT AND ROUNDUP
Major elections are dawning this week It's been mentioned by some
and many experts believe a Republican financial writers that the
majority in the U.S. Senate would lead Index of Leading Indicators has
to a mild if unsteady stock market boom. fallen four straight months and
durable goods orders have been
If Democrats retain the Senate then the well below forecasts.
markets may continue to reflect the wild
swings associated with the general air of It's not possible for interest
uncertainty. to fall much lower. If they
continue to drop and no economic
Ever since Yahoo (YHOO) reported better stimulus results then the government
than expected results the stock market has may be forced to give money away for
been improving. Financial insiders at leading free: in other words, the government
brokerage houses expect operating profits on would need to print more money, a
average will gain some 12% - 14% over year form of "positive" inflation but
2002 levels with at least a 7% improvement in inflation just the same.
operating profits for the Standard & Poor 500.
Billions of dollars in options have
However, in a bid to maintain margins, companies been exercised during 2002 and it's
are expected to cut back even further on my understanding the amounts must be
employment and consumer sentiment is still poor. deducted from corporations' reported
earnings for tax purposes and this
Foreign markets are extremely shaky and probably may tarnish the earnings picture for
will get worse in 2003 making it even more companies.
difficult for U.S. companies dependent on overseas
sales. Also, U.S. industrial capacity is
considered to be excessive which will
lead to more job cuts yet wages are
seen as continuing to increase adding
more pressure to inflation.
All in all, 2003 may see stock market
rallies on the good news of profit
growth but sharp declines on the poor
economic news. Investors currently
have discounted the gloomy economic
news celebrating the mildly solid
profit picture but economic reality
should sink in particularly if the
U.S. goes to war with Iraq.
I'm looking for things to get a lot
worse in 2003 before getting better.
Thursday, October 24, 2002
ANHEUSER-BUSCH INSIDERS MAY BE DUMPING STOCK
Yesterday, ANHEUSER-BUSCH (BUD) announced
its earnings for the Third Quarter. Net
Income was up 14.5% on revenues that were
up 4.8% and the company is shooting for 12%
EPS growth for next year, yet the company's CLICK HERE FOR EXCELLENT
stock price dropped around 4% and Morgan CBS MARKET WATCH REPORT
Stanley stood by its recent downgrading. ON ANHEUSER-BUSCH (BUD)
Seems the stock price is hitting a ceiling
and I wonder if insiders are dumping the
stock.
Check out the INSIDER REPORT; seems like
officers, including BUD's President, are
planning to sell some 112,756 shares; and
that's just for September, 2002.
Could be a bad sign for next year's
overall Dow Jones Industrials performance.
Remember, my thinking is that 2003 will
see the market hit 7,000 and probably
below which will be a signal to buy.
Thursday, October 17, 2002
ABAXIS SHOWING STRONG INSIDER BUYING
The stock market appears to have hit bottom
for this year, A lull in war talk from
the Bush administration has sent defense
stocks and precious metal stocks nosediving,
while better than expected results from Yahoo,
IBM and housing continues to rally the stock
market, but experts still expect things to get AUSTRALIAN STOCK MARKET
worse in 2003. Market breadth is a problem as FAILS TO RALLY
is jobless claims and sagging industrial
production and retail sales.
President Bush is still likely to go
to war with Iraq, terroists are still
likely to score at least one more
successful attack, and companies are
likely not to make much more progress.
2004 is still being seen as the year
of success against terroism and a
rebound in the nation's economy.
It's amazing how well AMERITRADE (AMTD)
is doing. I guess it's share price
won't be slipping much below $3.50 and
likewise I don't see COUER D'ALENE (CDE)
rising much above $2.00 a share.
Meanwhile, I noticed strong insider buying
at ABAXIS (ABAX). There is a string of
insider selling but it seems to be all
related to one former Vice President
(CLICK HERE); other officers appear
to be buying. Worth looking into.
Monday, October 14, 2002
THE BIG PICTURE
Whenver overall markets and individual
stocks make large moves either up or
down it's natural to be tempted to
reverse one's outlook. Thus when silver, NOT ALL ROSY FOR GENERAL ELECTRIC
which had been tracking gold as a hedge
against inflation and global tensions,
suddenly drops in value, many traders GENERAL ELECTRIC CEO JEFFREY IMMELT
thought silver was no longer a hedge ANSWERS DOUBTERS' CONCERNS
but was trading as an industrial
commodity like copper or aluminum.
And when stocks like Yahoo and General MANY COMPANIES' PENSION FUNDS
Electric turn in surprizing earnings, MAY BE UNDERFUNDED, WILL COST BILLIONS
some investors who had been preaching
about a soggy economy heading further
down begin thinking maybe the worse SOME ANALYSTS LIKE YAHOO, SOME DON'T
is over and the economy is rebounding.
Well, we need to keep the big picture
in mind. Great for Yahoo, yet beware ONLINE AD REVENUES MAY DROP 8%
that Yahoo's progress may be due much
to its increase in market share via
acquisistions and future quarters may
not show as strong an improvement. NO MAJOR NEW SERVICE CONTRACTS MAY HURT IBM
In fact, online revenue on which Yahoo
depends may drop as much as 8% by year's
end and another 3% in 2003 with no geniune
rebound until 2004.
Likewise, General Electric still hasn't
provided any guidance for its 2003
expectations and agreed that many of its
business lines are doing less than
originally forecast.
While IBM is expected to weather the stock
market storm, analysts are concerned about
a lack of major new service contracts. 5%
of IBM's total workforce has been laidoff,
including some 14,213 jobs cut from its
services division.
According to Merrill Lynch (if we can ever
again believe anything they say) the dramatic
drop in the stock market (where supposedly
much pension money is invested) will force
companies to charge billions of dollars to
earnings in 2003 to shore up sagging pension
funds. Ford and General Motors are expected
to be hit exceptionally hard due to union
pension rules.
Remember, the Dow Jones Industrial Average
almost broke below 7,000 just a few days ago,
so there was bound to be strong bargain buying,
but the economy remains weak. Retail sales
were reported off by 1.2% for September, worse
than the 0.9% drop that had been anticipated
while the University of Michigan consumer
sentiment index for October fell to 80.4
compared to 86.1 for September; again,
analysts had thought the October index would
be in the 65.7 range.
I expect another strong sell-off this week.
Wheather silver rises on industrial demand
or as a hedge against bad times, I still
like COUER D'ALENE (CDE).
Thursday, October 10, 2002
COUER D'ALENE MAY DROP NEAR $1.00 A SHARE
When there's a sell-off on the markets all one
can do is ask around to see why the big traders
have sold. There's been a sell-off on silver
and the reasoning is that future industrial
demand seems weak.
European traders (and Europeans in general) I
take it thought President Bush would announce
a forthcoming invasion of Iraq during his big
speech at Cincinnati a few days ago. When Bush
failed to make such a statement the Europeans
assumed all was well between America and Iraq
and began selling gold. When gold catches a
cold, silver gets pnuemonia. All that's left
is industrial demand which appears weak with
the sluggish world economy.
I'm told that a report from JP Morgan expects
silver to hit near the $4.00 an ounce range,
so COUER D'ALENE (CDE) could drop near $1.00
or less a share.
Such a price would be an excellant buying
opportunity in my opinion.
OPEC is expected to slow oil production,
Iraq is bound to violate inspection laws,
heralding a U.S. invasion, and the U.S.
economy is bound to get worse as global
concerns over Iraq make international
business more cautious and jittery. This
should ultimately help move precious metal
prices upward again.
Wednesday, October 09, 2002
YOU CAN'T SPELL "BULLSHIT" WITHOUT "BUSH"
Much has been said about President George W. Bush's
recent speech given in Cincinnati. Now look, the
hard fact is, like it or not, every U.S. President,
from Kennedy through Nixon, Reagan, Carter, etc.,
routinely gives truly important speechs from the
Oval Office...not from the Cincinnati Art
Museum! Thus, the speech Bush gave October 7th,
2002 really wasn't meant to be important, just some
rah-rah chest pounding bullshit meant to put
Democrats on the defensive as Fall elections near.
Oooo! Saddam might get a nuke by Christmas! Better CLICK HERE FOR TEXT OF
OF PRESIDENT GEORGE W.
vote Republican! Yeah. Right. BUSH SPEECH, OCTOBER 7TH,
2002, CINCINNATI, OHIO
Will Bush invade Iraq? I hope so! Gold and silver
should go through the roof on such action.
Overseas leaders, interestingly, saw some form of
softening on Saddam in the Bush speech. I didn't
detect any softening, but according to the experts
(professional world market traders) much of the
world thinks Bush isn't going to invade Iraq
afterall, thus gold and silver prices collasped.
I think the world is wrong. Bush sure as well will
invade Iraq...when the time suits his political
agenda. Yes. Bush is playing politics with Iraq.
Big deal. We may as well cash in on it too.
Major gold and silver fund managers have reportedly
been selling to take quick profits and I'm sure
they will be buying back on bargain hunting.
The world at large, in my opinion, has little
faith in George W. Bush. The man has no dimension,
no depth and lost the popular vote! I keep
saying, the value of any nation's currency is
merely a reflection of the confidence the world
has in that country's future and leadership, thus
I see the U.S. Dollar falling as world confidence
in Bush falls. As the dollar drops, precious metals
should rise. Inflation, a screwed up U.S. economy,
war talk, terroism, all should work to push up
precious metal prices.
Readers know I like AMERITRADE (AMTD), a long
term play for when the economy finally does recover.
I think AMTD will continue to fall in share price, so
readers can take their time.
Readers know I like COUER D'ALENE (CDE), America's
largest silver producer. I think it's cheap right
now and while very risky, I think it's worth buying
today in the $1.40 a lower share price range.
Gee...wish I could say there's been a typo on the
stock screen and that Intel, Cisco, etc., are really
worth one-hundred times what the boards say they are,
but nope: those stocks are dead in the water and are
going to stay that way for a long, long time, IMHO.
Do yourself a favor. Look at AMTD and CDE, okay?
Tuesday, October 08, 2002
AMERITRADE CLOSES BELOW $3.50 A SHARE
I've been saying that AMERITRADE (AMTD) at the
$3.50 a share range is a bargain and I think it
may fall even further. Again, AMTD could very
well, IMHO, hit $15.00 - $20.00 or more a share,
once the economy recovers! I think recovery
is a ways off and there's plenty of time to buy
into AMTD at bargain prices.
My other favorite stock is COUER D'ALENE (CDE).
It's America's largest silver mine. Silver prices
have been dropping lately on fears that a slowing
economy will mean less demand for silver and gold.
Precious metal investors buy silver after gold gets
too expensive and right now gold prices have been
dropping on fears of a slowing economy. Also there's
fear that a Leftist win in Brazil's presidential
elections could spark a further drop on Wall Street
on fears that lack of confidence in dealing with a
Lefist administration may cause a default on Brazil's
debt hurting U.S. banks. Foreign mining companies
operating in Brazil may be hurt by a devalued real,
the currency of Brazil. However, impending war between
U.S and Iraq should spark gold buying as well as bargain
hunting.
To me, it's clear that traditional stocks are going to
be hit even harder in the coming months. The Bush
administration is not paying much attention to the global
economy and that is going to hurt the U.S. balance of trade.
Most, if not all, the big players in precious metals continue
to feel strongly that gold and silver are poised for strong
moves upward. I like CDE because it is cheap and I agree that
precious metals are bound to move up on the growing
uncertainties in the world.
Friday, September 27, 2002
MAYBE SILVER LINING FOR PRECIOUS METALS
As I keep harping away here, AMERITRADE (AMTD)
and COUER D'ALENE (CDE) are my two favorite
stocks. Buy AMTD, IMHO, if you favor a rebound
in the stock market and buy CDE if you favor
a lingering recession.
CDE has dropped a great deal recently from the Great New Cosmic
$2.00 a share range to around $1.60 a share and Investor Link:
in my opinion represents a strong buy. Likewise, THE BULLION DESK,
any more bad economic news, plus profit taking, Daily Precious
should send AMTD's share price downward allowing Metals Updates
it to be bought at a great bargain.
Precious metal stocks dropped yesterday on news
that Barrick Gold may not reach earnings targets
due to operating costs (CLICK HERE).
There also has been strong selling aparently by
funds but the selling may be over and bargain
hunting should begin (CLICK HERE).
Tuesday, September 17, 2002
AMERITRADE GOING PLACES
AMERITRADE (AMTD) was trading at around $3.22
a share just last week and is now over $4.00
a share.
News is that the future looks bright for
Ameritrade's merger with Datek (CLICK HERE).
New accounts are increasing (CLICK HERE) and despite
some selling by individuals there is still
insider buying by several officers (CLICK HERE).
However, I think the economy is still weak
and will get weaker which will be bad news
for Ameritrade but great news for the silver
producer COEUR D'ALENE (CDE) which I am
continuing to hold.
Ameritrade also expects a big $65 million
write-off next quarter (CLICK HERE) which
should bring the price back down. I still think
Ameritrade is where to be when this economy/stock
market finally does recover (I seem to remember
the chairman turning down a $15.00 a share offer
claiming the stock is worth twice that); I just
think there's plenty of time to wait.
Wednesday, September 04, 2002
PRECIOUS METALS UPDATE
Just a note to remind my readers that I am still
holding firm to my precious metals investments,
mostly COEUR D'ALENE (CDE).
It went up some 6% yesterday as the DJIA slid over
300 points. I am expecting CDE to hit $5.00 - $10.00
a share over the next couple of years.
In my opinion, any drop in CDE over the next few
days would be a great buying opportunity. It is the
largest silver producer in America with gold holdings
as well.
I hope to continue holding my CDE shares for the
long term, but others may prefer to make quick,
profitable trades as I'm sure CDE share prices
will go up and down on speculation. It's a matter
of market timing and I'm lousy at that. However,
I've noticed that AMERITRADE (AMTD) is around
$3.40 a share and tends, in my opinion, to rebound
strongly when the overall market rebounds. Precious
metal stocks, conversly, drop in price when the
overall stock market rebounds and tend to go up
when the market drops, in my opinion.
So, one could day trade AMTD and CDE. As one goes
up, the other will go down and vice-versa.
I expect the world situation to worsen. Afghanistan,
in my opinion, is very unstable and the puppet president
America has installed there may be overthrown sooner
rather than later. One attempt has already been made on
his life and he now has U.S. forces protecting him,
apparently not trusting his own men.
I think the Bush Administration is in a hurry to invade
Iraq because it fears Afghanistan may soon collaspe and
the U.S. won't be able to fight that war over again and
still invade Iraq.
Israel and Palestine, India and Pakistan, North and South
Korea...ah yes, I really do see things getting worse
before they get better.
Imagine if terroists take over a jet plane by impersonating
U.S. Sky Marshals! Indeed.
Friday, June 14, 2002
BACK TO PRECIOUS METALS
Okay. I screwed up on buying into RAZORFISH (RAZF).
I was actually hoping against hope that a "normal"
stock still existed for making money in this market.
Well, BACKYARD BURGERS (BYBI) still looks hopeful,
but I'm back into precious metals, mostly gold/silver
mining stocks, particularly COEUR D'ALENE (CDE) which
I bought for around $1.88 a share at the end of last
month (May 28th).
I also cashed my stock based mutual fund (at a hugh
loss) and bought into the investment company's precious
metals mutal fund.
That's my opinion. Buy into COEUR D'ALENE (which I
think is still undervalued) and transfer any stock
based mutual funds accounts into precious metals funds.
For those funds without a precious metal fund, I suggest
looking into USAA GOLD FUND (USAGX). In my opinion,
it is highly regarded and experienced in the world of
precious metals investing.
Precious metal prices have been heading upward since the
troubled U.S. Presidential election results of 2000.
Most, if not all, gold/silver mining company executives
and analysts see gold prices hitting $350 - $370 - $400
an ounce during the next several years. CLICK HERE
and HERE for gold/silver market news.
Warren Buffet has some $600 million worth of pure silver
bullion and Bill Gates has a 12% interest in silver mine,
Pan American Silver (PAAS). CLICK HERE FOR ARTICLE CITING
BUFFET/GATES SILVER CONNECTION.
Now, with some profit taking selling among
precious metals stocks, it is in my opinion,
a fine time to be buying.
PLEASE SCROLL TO BOTTOM OF THIS PAGE FOR MY
EARLIER OPINIONS ON GOLD/SILVER.
Friday, April 26, 2002
RAZORFISH, COME-BACK STOCK OF THE YEAR
Faithful readers may wonder what I have
been doing lately. Well I've been chasing
after quick day trades mostly among $2.00
a share NASDAQ stocks.
I haven't been writing on these activities
since timing is so crucial that by the time
I post them on my web page the entire dynamics
may have changed!
However, I think I have found a stock worth
holding for the longterm.
That stock is RAZORFISH (RAZF). It has largely
been trading at below $1.00 a share for about a
year since revenues ending March 31, 2001 were
off some 30% from the previous year (CLICK HERE).
On February 25th of this year it hit $0.12
a share in intraday trading: that's twelve cents
a share! (CLICK HERE).
Then suddenly RAZF produced a profit for the First
Quarter, 2002 (CLICK HERE) and the stock price doubled.
Whereas daily volume was around 500,000 shares,
the daily volume was up to over 60 - 70 million
shares!
Lately, RAZF has announced additonal funding from
private stock placement (CLICK HERE) and its audtior
has retraced its previous statement expressing
concern about company as a going concern (CLICK HERE).
I have dumped all my losers and loaded up on
RAZF at around $0.37 a share. Let the games begin.
Thursday, January 24, 2002
FAREWELL FINDWHAT.COM
Yesterday I supported FINDWHAT.COM (FWHT)
for the longer term; probably will have
a nice quarterly report sometime in mid-
February. But today I dumped the sucker
at around $3.37 - $3.38 a share. I took
a hugh loss, but I'm a private investor
answerable only to myself.
Insider selling (CLICK HERE) and looming
legal woes (CLICK HERE) are just too much
to expect a truly great report. Stock may,
in my opinion, hit the $2.50 a share range.
I reinvested the meager proceeds back
into another favorite of mine: BACKYARD
BURGRER (BYBI) at around $6.78 - $6.79
a share. I think BYBI can hit the $9.00
a share range by summer.
Wednesday, January 23, 2002
FINDWHAT.COM SHOULD REBOUND
FINDWHAT.COM (FWHT) is a difficult stock
to day trade. It has closed lower in price
for eleven consecutive days. Yet, according
to my understanding of probabilities...that
is not abnormal. Twelve, thirteen, or fourteen
straight days would be abnormal, abeit it would
be too late to matter at these prices!
Thus I believe FWHT is due for a serious
rebound. I think the next quarterly report,
said to be due in mid February, should once
again exceed expectations. I see a $4.99 - $5.02
stock price range within the next four weeks.
I am holding and would suggest others consider
buying more to dollar average down in price.
Wednesday, January 16, 2002
COSMIC INVESTOR RETURNS
Many have wondered, what became of me? Did
I go bust in the bear market? Did I get hired
away by a big money management firm? Did I
get married and settled? No, No, No.
Just got bored there for a while, chasing
girls, getting back in shape, that sort of
thing.
I haven't gone bust. Still have my original
capital and then some.
There's money to be made in this market by
trading short-term. By on sell-offs and take
whatever profit you can.
Ironically, my last post here on November
29, 2001 suggested it was a smart time to
buy back into FINDWHAT.COM (FWHT). Today, some
six weeks later, it's still, in my opinion,
a smart buy.
I bought into FWHT yesterday at around $4.69
a share. I believe it will soon hit the $5.00
a share range, and if the next quarterly report
is as remarkable as previous reports it could
hit the $6.00 a share range.
Other stocks I follow include, PLUG POWER (PLUG),
BACKYARD BURGERS (BYBI) and ASK JEEVES (ASKJ).
I also made some quick money on K-MART (KM) but
don't recommend it now. And I still follow
various silver/gold mining stocks which I
believe can give some quick profits to
nimble investors.
Thursday, November 29, 2001
MAYBE TIME BUY BACK FINDWHAT.COM
Although I don't short stocks, I said yesterday
was a fine time to short FINDWHAT.COM (FWHT). And
today maybe a fine time to cover those short
positions and start buying for the long-term.
FWHT has never ceased to amaze analysts with its
revenue stream and judging from the FWHT MESSAGE
BOARD, investors are very bullish about this company.
Wednesday, November 28, 2001
FINDWHAT.COM / ASK JEEVES TRADE CYCLE
It's been some three weeks since I last
posted anything here; such are the trials
and tribulations of a bear market.
Interestingly, my last post is much the same
as my new post: FINDWHAT.COM (FWHT) is a
short-term trade. Right now it is rising, making
it prime for short selling, although as a rule
I don't short sell.
Meanwhile, ASK JEEVES (ASKJ) which competes
with FWHT is undergoing some heavy selling after
moving up some 125% since the beginning of
November, going from around $1.02 a share
November 1st to around $2.30 a share November 26th.
In fact in closed higher for sme six days in a row,
despite being party to a class action lawsuit
(CLICK HERE)
I think the sell-off in ASKJ is a great buying
opportunity.
I am looking today or tommorrow, depending on
my feeling about things, to sell my FWHT shares
and buy into ASKJ.
Monday, November 05, 2001
BACK TO FINDWHAT.COM
Well, I should have believed management.
FINDWHAT.COM (FWHT) has been saying over
and over that they have a proven formula
for making customers money and that the
World Trade Center attack would not effect
earnings.
Stock is up some 3 times since trading
resumed September 17th. Record 3rd
Quarter earnings just as management
predicted (CLICK HERE).
I have sold my AMERITRADE (AMTD) at
around $5.59 a share and bought into
FINDWHAT.COM at around $5.30 a share.
Tuesday, October 16, 2001
REVERSING MY PRECIOUS METALS POSITION
Those familiar with me know I often Another key to selling gold/silver
reverse my positions. If I seem eratic, mining shares is that several analysts
well so does the market. Sometimes it seem to have gotten on the band wagon.
takes insanity to combat maddness. When rank-and-file analysts start talking
up an investment...it's usually (IMHO)
I had been expecting something big to time to sell.
happen. Well, I guess that would be the
destruction of the World Trade Center. I have sold all my precious mining stocks
And certainly, gold and silver prices and have bought into AMERITRADE (AMTD).
went up. But the U.S. and her allies There has been strong insider buying by
seem to have things under control. It's AMTD chairman/founder J. Joe Ricketts who
doubtful that the Taliban can seriously apparently still believes AMTD is worth
threaten stability in the Middle East. 4 - 5 times its current price of $5.50 a
share.
This is the key to precious metal prices.
Make no mistake about it. Gold advances
stronger than normal only if major countries
are faced with certain collaspe.
The U.S. may topple the Taliban but this will
be welcome news to the Middle East and many
rich moderate Muslim oil shieks will breathe
a sigh of relief.
Tuesday, September 25, 2001
WHY SILVER
PROLOGUE
I'd say all religion in America has been Shah Reza Pahlavi of Iran, for example,
watered down from many of its original ruled for over 30 years before his
beliefs and practices. people finally succeeded in revolting,
removing him from power. He tried to
Fundamental Christians don't crush infidels "modernize" Iran by allowing women to
between mill stones. Mormons have had to vote. Several fundamentalist Iranian
do away with polygamy. Jews and other faiths Muslims were outraged. The Shah's
cannot scarifice animals. Public stoning is notorius secret police (SAVAK) managed
not allowed. to suppress most rebellions but in 1979,
the people overthrew the Shah, replacing
Islam, founded in 611 A.D. by divine revelation him with the Ayatollah Ruhollah
to a wealthy Arab in Mecca named Mohammed, has Khomeini.
remained remarkably true to its original tenets.
Taking advantage of the shaky situation
Contact with the West, especially with the in Iran, Saddam Hussein of Iraq invaded
rise of the petroleum industry, has had its Iran in 1980. Afghanistan, fearing the
effect on watering down Islam but millions in revolution would spread to its soil,
isolated deserts and mountain villages still enlisted the Soviet military to help
believe and live much as the first Moslems did. squash its rebels. The rebels rebuffed
the Soviets and native Afghan Islamic
And these simple peasants have given rise to fundamentalists called the Taliban took
many rank and file Islamic militants who learn control.
of the evils of Westernization at the knees of
educated, well rounded, well traveled fanatics All this war: the Soviets, Saddam
such as Osama bin Laden who wish to restore all Hussein, Islamic militants, caused many
Muslim nations to the original faith by any wealthy, moderate Arab neighbors, like
means necessary. Saudi Arabia, to begin hoarding gold
in the advent their nation would fall
With some 2 billion Muslims in the world, there next and they would need to make a quick
are easily millions who side with the militants escape. By January of 1980 gold which had
in spirit if not in fact. Any attempt at Mid been trading around $165 an ounce, hit as
East moderation is not likely to last very long. high as $875 an ounce. Silver went from
around $10 an ounce to an all time high
of $52.50 in 1980.
SILVER TODAY
Inflation as well as unrest in the Middle East Today's turmoil may not be as intense
caused silver to rise in value in 1980, but so as back in 1980. Saddam Hussein may not
did the Hunt Brothers of Texas who tried to be on the prowl. The U.S. is far less a
corner the silver market. As word got out threat to moderate Islam than the old
of their buying, others bought driving the Soviet Union. But Muslim fundamentalists
price to the aforementioned $52.50 an ounce. are still a power to be reckoned with
When the Hunts got a $100 million margin and are sure to emerge again and again no
call they had to sell some of the silver to matter who is in power, keeping upward
cover the call. As they sold, others panicked pressure on gold and in turn on silver too.
and sold too and the price soon went back to
the $10 an ounce range. The Hunts filed for Silver has practical industrial uses.
bankruptcy. Kodak uses over 55 million ounces a year.
Warren Buffett is not some gun-slinging
Recently, back in 1997, famed equity investor Texas risk taker but a calculating man.
Warren Buffett, began buying up some 20% of It's assumed he is still holding his some
the world's available silver at around $5 an 130 million ounces of silver and may even
ounce. When word got out about this in February be buying more, waiting perhaps for $10
of 1998, silver reached a nine year high of an ounce before he sells.
around $7.23 - $7.31 an ounce.
As silver mines quickly began producing more
silver, and speculators pulled out, the price
went back down. It's now around $4.50 an ounce.
Monday, September 24, 2001
AFTERNOON UPDATE, 3:00 p.m., EDT
The markets are still up on bargain hunting Remember, recession is still looming
speculation. But, remember by September 14th big in the U.S. and Asia. Terrorist
notes, this may be the last major rally before reprisals may yet shake moderate Arab
yet another crash. nations to begin dumping stocks,
real estate and oil in favor of gold.
As the markets reopened Septermber 11th, I mentioned
that nervous investors could wait until after the China, who has always wanted access
selling. I sensed a rally would soon occur among the to Russia's underbelly by way of
blue chips with some profit taking among the precious Afghanistan could still come to the
metal stocks. At this point (which is now, today) assistance of the Taliban.
investors who have been waiting to sell their blue
chips and load up on precious metal stocks have a Muslim rebels in Chechnya could also
window of opportunity to do so. take advantage of the situation and
step up their attacks on Russia which
could hinder the allied war on terrorism.
MORNING UPDATE, 10:00 a.m., EDT
Rapid market rally among blue chips and Nothing wrong with taking profits this
sharp selling among gold/silver mining morning on COEUR D'ALENE MINING (CDE) or
stocks, as moderate Northern Afghanistan HECLA MINING (HL) while one still can.
Resistance Forces took over a small Afghan
town once ruled by the Taliban. Town could But anything can happen. A strong,
be key to more strategic takeovers. solid strike against a Muslim neighbor
by the Taliban, or another successful
Rumors also of British special forces already large scale terrorist attack by Osama
lending Northern Resistance a hand. bin Ladin against the U.S., and gold/
silver prices will undoubtedly go through
All this means less fear among Arab nations of the roof. I'm still holding CDE and HL.
takeover by more extreme Islamic fundamentalists.
It is this fear of Islamic extremism that causes
more moderate Arabs to buy gold and silver.
Oil prices are also dropping as world traders are
more assured that OPEC will not be disrupted by
the U.S. war on terrorism. Lower oil prices
will help lower inflation. Inflation is another
reason why investors would buy gold. Lower
inflation means investors are less likely to buy
gold.
COSMIC INVESTOR ADDS NEW WEB LINKS
In view of the attraction of gold and silver
related investments, Cosmic Investor has
added several new gold/silver daily/historical
pricing links to its homepage.
Just click on HOME and scroll down to
TECHNICAL INDICATORS.
Friday, September 21, 2001
GOOD NEWS: ONLY 1,000 POINTS MORE TO FALL
I've been saying the DJIA would hit
around 7,300 this year or next and
stay there for 12 - 16 months.
This is based on the fact that the
historical average PE for DJIA stocks
has been around 14. Below are the
current DJIA stocks, their current PE
and current price and what their price
must be to yield a PE of 14 and a PE
of 10.
The corrsponding DJIA could be around
5,600 - 4,100.
DOW JONES INDUSTRIALS COMPANIES:
Closing
Stock Symbol Price PE Price to Price to
(09-20-01) Get PE of 14 Get PE of 10
Aluminum Co. of America AA 28.59 18 22.24 15.88
American Express AXP 26.10 16 22.84 16.31
AT&T T 18.13 NA NA NA
Boeing Co. BA 29.80 9 46.36 33.11
Caterpillar Inc. CAT 41.69 17 34.33 24.52
Citigroup Inc. C 36.31 15 33.89 24.21
Coca-Cola Co. KO 48.35 37 18.29 13.07
DuPont DD 34.12 34 14.09 10.04
Eastman Kodak EK 32.58 15 30.41 21.72
Exxon Mobil Corp. XOM 37.02 15 34.55 24.68
General Electric GE 30.37 24 22.42 16.01
General Motors GM 41.70 16 36.49 26.06
Honeywell International HON 23.59 37 8.93 6.38
Hewlett-Packard Co. HWP 14.50 22 9.23 6.59
Home Depot HD 32.80 31 14.81 10.58
Intel INTC 20.67 28 10.34 7.38
Int'l Business Machines IBM 93.40 21 62.27 44.48
Int'l Paper IP 32.50 NA NA NA
J. P. Morgan JPM 31.56 19 23.25 16.61
Johnson & Johnson JNJ 52.35 31 23.64 16.89
McDonald's MCD 27.37 21 18.25 13.03
Merck & Co. MRK 66.85 22 42.54 30.39
Microsoft MSFT 50.76 39 18.22 13.02
Minnesota Mining & Mfg. MMM 90.32 24 52.69 37.63
Philip Morris Cos. MO 47.43 13 51.08 36.48
Procter & Gamble PG 72.81 36 28.32 20.23
SBC Communications SBC 45.90 19 33.82 24.16
United Technologies UTX 41.64 12 48.58 34.70
Wal-Mart Stores WMT 45.31 32 19.82 14.16
Walt Disney CO. DIS 16.98 93 2.56 1.83
DJIA: 8,376.21 5,810.24 4,150.77
Wednesday, September 19, 2001
THINGS ARE GETTING WORSE
Readers may want to see me update my notes Thousands of companies are already
during this time of crisis but I really expected to lower their earnings
have nothing new to say. estimates because of fallout from the
World Trade Center beating.
Things have been getting worse since George
W. Bush beat John McCain in the South Tens of thousands more will be losing
Carolina primary back in the summer of 2000. their jobs.
I guess "insiders" knew then old George Bush, Recession is a sure bet.
Sr. was planning a coupe with his idiot son
G. W. installed as a puppet and started buying I still say stocks of silver mining
into gold and silver stocks. companies are undervalued, but won't
be for long. I like COEUR D'ALENE (CDE)
The current Bush administration is a rehash of and HECLA (HL) and am long both.
the old Desert Storm cabal spoiling for a fight
with anybody in the Middle East. I just hope I said it before: a lot of diehard
the Bush government allows us to capitalize on Republicans are crusty, old gold hoarders
it by trading gold/silver stocks. and won't rest until they see $900.00 an
ounce gold.
CLICK HERE FOR ECONOMIC NEWS ROUND-UP
Tuesday, September 18, 2001
SOME OF MY RECENT TRADES
Yesterday I sold my holdings in FINDWHAT.COM (FWHT) The markets have been looking for
between $1.54 - $1.60 a share and sold my holdings direction and U.S. President George
in NATIONSRENT (NRI) at between $0.25 - $0.27 a W. Bush has finally provided a
share and bought into COUER D'ALENE MINES (CDE) definitive vision for his term: war
at around $0.80 a share and HECLA MINING (HL) at and recession. Trade accordingly
around $0.95 - $1.00 a share. (see Cosmic Investor Special, September
14, below for details).
I see a recession coming which will be long and
bitter and expect both FWHT and NRI to be lowering
earnings estimates sometime in the near future.
I think both CDE and HL are great buys at or
below $1.00 a share.
Sharp rallies in precious metals stocks and
defense industry stocks may lead to profit
taking sell-off...great opportunity for
shorts, particularly NEMONT MINING (NEM)
and ALLIANT TECHSYSTEMS (ATK). And, IMHO,
these stocks are also great to buy on any
weakness.
Cosmic Investor Special, September 14, 2001
BLACK HOLE MONDAY
Make no mistake about it, regardless of who STOCKS FOR THE NEXT 3 - 4 YEARS:
you voted to be U.S. President, the United
States of America is going into recession. ALLIANT TECHSYSTEMS (ATK)
ATK is a $1.6 billion aerospace and defense
Many of us could not believe things would company with leading positions in propulsion,
get this bad this soon, even myself who kept composite structures, munitions, and precision
fearing something of this magnitude would capabilites. Assumed to be the Pentagon's
happen. chief munitions supplier.
(CLICK HERE FOR LATEST QUARTERLY REPORT)
And I dare say, we might as well face it:
things are going to get worse. The "war LOCKHEED MARTIN CORPORATION (LMT)
against terrorism," even by G. W. Bush's LMT is a $29 billion aerospace/telecom company
estimation will last at least for the remainder known primarily for its U-2 spy plane. Recent
of his term in office. And, contrary to popular earnings already tripled from last year.
belief, war is not good for the economy. It (CLICK HERE FOR LATEST QUARTERLY REPORT)
creates uncertainity and disrupts markets and
causes supply and demand shortages. CBS MARKET WATCH DEFENSE STOCKS WRITE-UP
Be prepared for companies to now issue new CBS MARKET WATCH MARKET ADVICE WRITE=UP
downgraded earnings estimates to reflect the new
slowdown not only from the decimated World Trade CHEVRON CORPORATION (CHV)
Center but from businesses and consumers taking The machinery of war will need lots
a wait and see approach to any new spending. of oil and Chevron's recently approved
merger with Texaco makes it the No. 2
Most experts agree, Monday morning, September oil company in the world. Proven reserves
17th, 2001 will see enormous volume and it could be double that of BP Amoco.
will be difficult for many investors have their Bush chief foreign policy advisor,
orders filled at desired prices. I expect a hugh Condoleeza Rice used to be on CHV's board
sell-off...but also a slight rebound. This rebound of directors. I expect it will do well.
may be as soon as late Monday afternoon, or take (CLICK HERE FOR MERGER REPORT)
1 - 2 weeks. But I will undoubtedly be selling as
soon as I can sense a rally. EOTT ENERGY PARTNERS, L.P. (EOT)
Big Texas based indie marketer/transporter
Understand, the selling by myself and others will of crude oil in North America. Second
not be from panic or fear but from a change in Quarter net income rose 24%, full year
economic growth. No more high tech/smokestack earnings target raised 58%, all while
growth. The growth will now be in defense industry market conditions were seen as "less
stocks and precious metals, in my humble opinion. favorable" than a year ago. 8.4% yield.
(CLICK HERE FOR LATEST QUARTERLY REPORT)
If you must sell into the downturn Monday, I
suggest selling a few rounds of stock at a time. COEUR D'ALELNE MINES CORPORATION (CDE)
Dumping all your shares at once is more than Well, this one is extremely risky.
likely to work against you. Forget trying to It is the largest of U.S. located silver
save a few dollars on added commissions. Sell producers. Silver prices are rather low,
a few shares at a time to gather a sense of the but if gold prices continue soaring,
market and trade executions. investors will soon be buying silver.
At 75 cents a share, CDE could hit
I have no guaruntee the Bush Administration will $4.50 a share, where it was about two
co-operate, but I am hoping Bush will wait a week years ago. Lots of debt and CDE could
or two for the markets to settle before launching dilute its stock by issuing more shares
any major attack. I am guessing the major attack in lieu of dividends to its 13.375%
will occur sometime around 10 - 11 a.m. New York convertible junk bond holders.
City time, the morning of October 2nd, 2001. It (CLICK HERE FOR LATEST QUAERTLY REPORT)
will be around midnight then in Afghanistan and (CLICK HERE FOR JUNK BOND INFO)
there's a full moon scheduled for Oct. 2nd. I suspect,
Colin Powell is "old Army" and prefers the light HECLA MINING COMPANY (HL)
of a full moon which is helpful for forces to keep Like Couer d'Alene Mining, Hecla is also
their bearings when all else fails and all hell is a big U.S. based silver producer with a
breaking loose. bit of financing woes as 5.7 million new
shares issued via a private placement are
At any rate, again I have no guaruntee the Bush poised to trade on the open market one
Administration will accomadate the markets, but I year from now, plus there's a water
do hope he will wait a couple of weeks for Wall quality lawsuit looming in background;
Street's selling/buying frenzy to settle. During but at 85 cents a share, the risk may be
this time I intend to sell my holdings in worth it to some. It was trading at $6.00
NATIONSRENT (NRI) and FINDWHAT.COM (FWHT) and a share back in May, 1998.
buy shares in COUER d'Alene (CDE); the largest (CLICK HERE FOR LATEST QUARTERLY REPORT)
silver producer located in the U.S. (CLICK HERE FOR PRIVATER PLACEMENT DETAILS)
Cosmic Investor Special, September 12, 2001
U.S. ECONOMIC PROSPECTS UNDER
PRESIDENT GEORGE W. BUSH
NOTE: This report was written with the working date of AT THIS POINT THE BEST
September 7, 2001, four days before the horrendous attack INVESTMENT MAY BE TO
on America by an unknown source. I am not worried about YOUR LOCAL RED CROSS
current conditions. America is like Mike Tyson. Being the
champion of the world doesn't mean you can't get blind- RED CROSS VIA AMAZON.COM
sided and knocked on your ass but you come back up RED CROSS ONLINE DONATIONS
swinging. By Telephone: 1-800-HELP NOW
By Conventional Mail:
Our country has suffered blows before: the burning of AMERICAN RED CROSS DISASTER RELIEF FUND
our Capitol during the War of 1812; General Custer's P. O. Box 37243
defeat at Little Big Horn; the War Between The States Washington, D. C. 20013
Presidental assassinations, the attack on the U.S. Navy (make check out to:
ship, Maine; lynchings, Prohibition. We will rebound; AMERICAN RED CROSS DISASTER RELIEF FUND)
I am sure of that.
On September 7th, calling for a DJIA 7,000 - 7,900 by WITH THE MARKETS CLOSED,
Fall's end seemed ludicrous; thus I postponed it to the I AM FOREGOING THE LIST
Fall of 2002. However, I still maintain things will get I HAD PREPARED OF STOCKS
worse before getting better and the markets are not likely BEATING THE DOWNTURN.
to recover until after Fall 2002. This report follows word
for word, just I had it planned as of September 7, 2001. OFF HAND, I WOULD SAY
BUY GOLD MINING STOCKS,
We mustn't forget that George W. Bush did not win the OR JUST HOLD THE STOCKS
popular vote. And despite all recount efforts nobody has YOU ALREADY OWN UNTIL
yet figured out how many Patrick Buchanan votes should THINGS TURN AROUND IN
have gone to Al Gore. Had Bush any decency he would have 3 - 5 YEARS.
resigned the Presidency at the start. Nor can much be said
about a man who speaks English less well than the President FOR THE BRAVE, THERE
of Mexico where it's not even his native tongue. SHOULD BE SOME GREAT
BUYING OPPORTUNITIES,
My outlook for the U.S. economy under President George PARTICULARLY BLUE CHIPS.
W. Bush is that things will get a lot worse before getting
better. Unemployment will continue to grow; tax revenues
will drop; Americans will be called upon to tighten their
belts in the wave of Federal government spending cuts,
and the world outside America will become more dangerous
making it less safe for American global businesses.
I expect to see a Dow Jones Industrial Average in the
7,000 - 7,900 range, with a corresponding drop among
most New York Stock Exchange and NASDAQ stocks of
30% - 55% before the bottom is seen.
Things will probably hit bottom in the Fall of 2002.
Market crashes have typically occurred in the Fall
of the year and I think the recent sell-off is just
the beginning. I look for several more 250 point
losses in the DJIA which will probably close below
9,000 by November - December and limp along for most
of 2002. Thus, by October of 2002, the time will be
right for buying.
Trouble in the Middle East directly effects the price of
gold which in turn effects the strength of the U.S.
dollar. Likewise, the value of the U.S. dollar is a direct
vote of confidence or lack thereof in the U.S. Presidency.
Since the plight of the U.S. Navy spy plane in China back
in April, 2000, George W. Bush and his administration have
exhibited a total lack of world leadership and global
domination. Gold prices and shares of gold mining companies
have been rising since the November, 2000 crisis developed
with the American presidential election. The growing unease
around the world continues to fuel gold prices.
Keeping the world safe means making it safe for U.S.
capitalism and Bush is not up to the job. Rather than
meeting with Arab and Israeli leaders to open a dialogue
for peace, George W. Bush President of the United States of
America would rather host a state dinner for his friend,
Vincente Fox, the President of Mexico. America's security
depends on dialogue with Asia and the Middle East...not
friends across the Rio Grande.
I am assuming the U.S. Secretary of State Colin Powell
wants Israel to emerge triumphant, vanquishing the PLO for
once and for all. True, a strong Israel and a destroyed PLO
will lead to stability in the Middle East, but it will be a
bloody, violent process which will continue to rock U.S.
corporations' overseas profits. Thus do I say things will
get worse before getting better.
The Bush tax rebate is another example of this man's lack of
vision and inability to lead. While a wealthy few are receiving
four, five and six figure rebates, the vast working class of
America is seeing only $20.00 or a few hundred at the most.
It would have been better to have saved the U.S. budget surplus
for a rainy day, for when these workers will need unemployment
compensation and Medicaid assistance.
It seems the poor working class were convinced by the Republicans
that they could be rich too, if only the liberal Democrats were
voted out of office. Now the working class will be forced to
lower their wages and standard of living to compete with Mexican
labor. And while this may benefit a few corporations, it will
hurt the overall U.S. economy. Democrats tend to try to benefit
large classes of people while Republicans tend to try and benefit
a few well connected individuals. Thus do I see a trend for
Texas based firms to do better than their non-Texas peers. Texaco,
Inc., for example, with roots going back to 1902 Texas, has had
its shares perform much better under Bush than the Exxon Corporation
whose roots go back to Rockefeller and the Eastern capitalist
establishment of 1882.
While some think lower taxes will generate greater tax revenue
it needs to be pointed out that tax revenues actually dropped from
between 1982 -1983 while the unemployment rate rose from 5.6% in
1979 to 10.8% by the end of 1982. And while tax revenues rose 140.3%
between 1970 - 1979 from $192.8 billion to $463.3; tax revenues rose
just 75.8% between 1980 - 1988 from $517.1 billion to $909.0 billion.
From 1972 - 1979, tax revenues rose an average of 11.23% a year,
while from 1983 - 1990 (under President Ronald Reagan's tax cut)
tax revenues rose just an average of 6.71% a year.
The drop in tax revenue growth could not be matched with a
corresponding drop in Federal spending which led to deficit
spending...sending the Prime Rate from from 6.75% to 15.5%
between 1976 - 1979 and onward to 20.50% by 1981. Everybody
wants the government to cut expenses except when there's a
flood, drought, hurricane or forest fire then these same
people are lined up with their hands out for Federal
assistance.
Bush himself is already looking to raise spending for education
by some 10%. If Republicans feel Clinton increased government
spending too much then why is Bush also increasing spending? If
tax revenues under Bush grow by only the 6%- 7% as they did
under Reagan and yet Bush proposes spending increases of 10% or
more the result will be Federal deificits. And any suggestion of
an unproven, costly Missle Defense Shield will just exacerbate
the Bush economic problem.
The tax cut under President John F. Kennedy took the top
rate from near 94% to just around 70%, while Reagan's tax
cut took that 70% rate and lowered it to around 52%. The
Bush tax cut seems to be a modest 10% reduction...not enough
to stimulate the economy but enough to make people feel some
degree of uncertainty about their future.
And while Kennedy was battling unemployment which had grown
from 3.7% in 1957 to 7.5% in 1958; and while Reagan was
fighting both unemployment and inflation, George W. Bush
put forth a tax cut without any real need for it. A cut in the
capital gains tax would have been nice, as well as tax
exemption for reinvested dividends. But no, Bush thought he
would follow Reagan's lead and give a tax cut which makes
as much sense as addressing the issue of racial profiling
by following Abraham Lincoln's lead to free the slaves.
Americans are not clamoring for tax cuts; they are
clamoring for leadership.
Monday, December 04, 2000
GOLD STOCKS SEEM TO BE MOVING UP
A few weeks ago I mentioned that gold prices
were flat and stocks of gold mining companies MONEX GOLD CENTER FOR
were risky. I mentioned it as "proof" that the GOLD MARKET NEWS
uncertainity surrounding the U.S. Presidential
election was not that much of a crisis.
Gold moves up on uncertainity, threat of inflation
and major crises. Well, I still don't think the
election is that big a problem and the price of
gold still seems flat but gold mining stocks do HISTORICALLY, GOLD STOCKS
seem to be moving up again. The reason is that the MOVE UP AS THE STOCK MARKET
U.S. Dollar may be weakening against foreign currencies. HITS BOTTOM
The strength of a nation's currency is a reflection
of how much confidence the world at large has in that
nation's ability to run things. The U.S. dollar may be
dropping due to the Presidential issue but also because
it has been rather overly high and should be trending
downward.
Add to this the fact that gold traders are short some ANOTHER WAY TO PLAY GOLD IS
4.6 million ounces. The last time they were this short THROUGH A GOLD FUND, AND I
was back in September, 1999 and gold moved up some $60 BELIEVE USAA IS THE BEST
an ounce as shorts covered their positions.
Gold trading is very, very risky. If there is a big
one day price move, I would suggest selling: gold rallies
are extremely short lived.
Buying gold itself can be expensive and complicated. Best
left to professional gold dealers and mining companies
hedging their operations. Most "average" investors play
gold by buying shares of gold mining stocks.
There are over 50 gold mining stocks on the various
exchanges, but many are facing bankruptcy and several ANGLOGOLD HOME PAGE...
are selling off assets to meet operational expenses, POOR INVESTMENT RIGHT NOW
not to mention land claim lawsuits and environmental I THINK; BUT NICE PICTURES
and labor problems. OF SEXY MODELS WEARING GOLD
When considering a gold mining stock, look at the amount
of reserves and production cost per ounce among other factors.
I list below five, in my opinion, of the better ones.
NEWMONT MINING (NEM)
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Opinions expressed here are those of J. F. Phillips, a total amateur and may be entirely
inaccurate and off the mark. Do not trade on the basis on these opinions. They are mostly
for entertainment purposes and for those curious about what goes on in the mind of J. F.
Phillips. Always seek professional advice and independent verification before making a
trade and remember...J. F. Phillips may have positions in the underlying investments
mentioned. This sure as hell is not an offer or solicitation to trade in anything!
COSMIC INVESTOR·°. MARKET NOTES... The Bible of Market Capitalism......
continue to check back here throughout the day for late breaking comments
Monday, October 24, 2005 IS ANYBODY OUT THERE?
I hate it when I return to an interesting website only to find it hasn't changed any in the passing months or that it has been discontinued altogether...yet that seems to be the case with my own website! Where have I been? Right here, not doing much. I've been trying to find stocks I can hold for the long term. My favorite had been FORTUNE BRANDS (FO) but I recently sold it. Its share price had been slipping and it finally dawned on me that FO has a huge exposure to the hard liquor market and that hurrican Katrina really put a hurt on New Orleans. Any idea how much hard liquor is consumed in New Orleans? Quite a bit I would think, so no wonder FO's share price has been falling. I sold my Fortune Brands stock and put it all into GOOGLE (GOOG). That was back around October 10, 2005. I sold FO at around $77.73 a share and bought GOOG at around $311.10 a share...right before the big earnings release and the accompanying sky rocketing rise in GOOG's share price. In fact, I estimate I made back anything I might have lost by selling stock to buy GOOG. GOOGLE is now my favorite long term holding. Sorry I didn't give anybody a heads-up on my impending sale of FO and purchase of GOOG but I feel any sell off in GOOG is still a sound buying opportunity.Tuesday, February 17, 2004 INTO THE NEW YEAR
Under the Bush economy, NASDAQ has remained less than half its average under Clinton, but the Dow Jones Industrials have done rather well. This means, large companies with oil, gas and chemical interests and defense contracts have done well but bright, new, innovative companies have suffered. Gold stocks have also done well under Bush since the world feels the end is near with this beady-eyed bozo running things. It's clear to me, Bush never was popular. He "won" the 2000 election by the thinnist of margins. He's even less popular today. John Kerry should have no problem defeating him in November. If Bush does manage to pull another 2000, I would expect war in the streets, hence buy more gold stocks. But with Kerry in the White House, I hope to see more gains for ordinary NASDAQ type companies. Many NASDAQ companies, and investors, are already anticipating a Kerry victory. I have sold my Ford (F) and Goodyear Tire (T) stocks and invested in Electroglas Inc (EGLS), Intrusion Inc (INTZC) and Kimco Realty Corp (KIM). I also still like day trading Coeur D'Alene Mines (CDE) and I am still holding my shares in Ameritrade (AMTD). Below are notes I made to myself, which I am sharing here. WHAT I CALL STEADY GROWTH STOCKS: North Fork Bancorp (NFB) Mangement Buying Tons of Shares, Expects New Growth From Expansion Fortune Brands Inc (FO) Earnings Up 20%, Solid Name Brands, Small Dividend, Expects Double Digit Growth American Capital Strategies Ltd (ACAS) Solid Chart, Dividend but May be Interest Rate Sensitive Kimco Realty Corp (KIM) Nation's No. 1 Shopping Center REIT, Earnings Up 29%, Modest Dividend, Solid Chart Emerson Electric Co (EMR) Strong Volume, Modest Dividend, Continued Upturn Seen Piedmont Natural Gas Inc (PNY) Strong Volume, Nice Dividend, Modest Insider Buying WHAT I SEE AS STOCKS RISING FROM THE BOTTOM: Intrusion Inc (INTZC) Still Has Loss but Revenue Up 26% From Last Q, 34% From Year Ago, May Have Hit Bottom Electroglas Inc (EGLS) Strong Volume, Sees Continued Upturn STOCKS I THINK ARE POISED FOR GROWTH: American Retirement Corp (ACR) Solid Future but No Dividend Cornell Companies Inc (CRN) Anticipates Bright Future DTE Energy Co (DTE) May Go Lower Near Year's End Priceline.Com Inc (PCLN)Lower Costs, New Services, Showing Profit Sandisk Corp (SNDK) Lots of Analysts Bad Mouthing SNDK but Strong Insider Buying, New Products. SBA Communications Corp (SBAC) Enormous Share Buying By Capital Firm, Plans for the Future Sizeler Property Investors, Inc. (SIZ) Modest Revenue Improvements, Solid Insider Purchase, Hefty %7 Dividend Rate Talk America (TALK) Total Revenue Up 24%, Business Growing, Expanding, Big Insider Purchase ValueClick, Inc. (VCLK), Revenues Up 61%, Company is Optimistic For Year, Large Insider Buy Vitesse Semiconductor (VTSS), Revenues up 39%, Some Favorable Analyst Reports, Sizeable Insider Buys STOCKS I LIKE FOR DAY TRADING: Aetrium Inc (ATRM) Compudyne Corp (CDCY) Savvis Communications Corp (SVVS) Forbes Medi-Tech Inc (FMTI) Hartmarx Corp (HMX) Centex Corp (CTX) Coeur D'Alene Mines (CDE) IN MY OPINION, HIGH RISK, HIGH REWARD PLAYS: Incyte Corporation (INCY) Strong Chart, Volume, Strong Analyst Report Kmart Holding Corp (KMRT) Strong Inventory Management, Reducing Unprofitable Moves, Sees Profit Short Term Midway Games Inc (MWY) Last Quarter Revenues Down 78%, But New Report Due Feb. 25, May Be Moving Up Again Midway Insider Buying; Hundreds of Thousands of Shares Purchased by Sumner M. Redstone Mayor's Jewelers (MYR) 41% Increase in Net Income, May Have Some Cumulative Dividends Problems but May Have Hit Bottom. Company was Formerly Jan Bell Marketing, had to end some 472 concession sites at Sam's Club in 1993, causing a huge sell-off of the stock. Was trading around $12 a sh, dropped to around $7 a sh after Sam's Club agreement ended. Company has been restructuring itself (CLICK HERE). Canadian Henry Birks supposedly owns 72% of company. Mayor's seems happy with the arrangement, hoping Birk's expertise will rescue it. His Preferred Stock will convert into 58% of the common stock as I understand it. Mayor's now runs 28 luxury jewelry stores in FL and GA. Optical Cable Corporation (OCCF) Shares Were Trading in $60 - $100 range until Fall 2001. In 2001 OCCF got hit with a shareholder class action lawsuit (CLICK HERE) and with a race/ gender lawsuit by the U.S. Federal Government EEOC(CLICK HERE). The shareholder lawsuit was supposedly settled in Fall 2002 (CLICK HERE). As of January 14, 2004, mangement said, "We remain cautiously optimistic about future net sales and have seen some preliminary signs our markets are firming. However, it is still unclear when our markets will begin to show sustainable growth," CLICK HERE. Penn Treaty American Corp (PTA) Dropped from $20 - $30 a share to under $2 a share on investor class action lawsuit CLICK HERE for not having enough reserves but PTA seems to have settled the lawsuit and has raised enough capital to cover reserves and is being allowed to recompense business in several states including California (CLICK HERE), and officers have bought modest amounts of company's stock (CLICK HERE). Questcor Pharmaceuticals (QSC), "acquires, develops, markets and sells brand name prescription drugs through a U.S. direct sales force and overseas distributors and marketing partners." Has $83 million accumulated deficit, but price shot up 18% to $0.93 a share Feb. 13 on hopes that its newly acquired product, Nascobal, is progressing well (CLICK HERE).Home Insider Trades Editorials Statistics Interesting Web Sites Mututal Funds
Monday, August 11, 2003 I HAVE CASHED IN MY AWA SHARES
Last week I decided to sell my AMERICA WEST (AWA) stock. The share price had had a phenomenal runup and lately has been steadily falling. The fall, I believe, is due to profit taking, panic selling and most importantly, IMO, the renewed fears of airline security and terrorism. Added to this is the weak July traffic report (CLICK HERE) and the traditional slow period for airlines that follows the end of summer vacation, usually on Labor Day. To be sure, there is also some strong buying going on for AWA shares and this is creating a fine short-term, day trading opportunity for those with the nerves for it. I sold on a recent anticipated rally at around $7.51 a share. I took much of the proceeds and bought more GOODYEAR TIRE (GT) shares at around $5.19 a share. I think GT is still a bargain in the $5.00 a share range.Monday, May 26, 2003 BANK OF AMERICA CHAIRMAN DUMPING SHARES
According to Yahoo! Finance Insider & Form 144 Filings, BANK OF AMERICA (BAC) Chairman Kenneth Lewis is planning to sell 228,572 shares of BAC stock, worth an estimated $13,714,320 (CLICK HERE). BAC's share price does appear to be peaking at it's 10+ year high of $74.00 a share and more worrisome is the effect deflation may have on bank stocks in general. The U.S. dollar is very weak overseas which, in my opinion, means Europeans don't much care to buy American goods so U.S. companies DELATION MAY HURT BANKS are having to slash prices. With lower prices, companies are less willing to pay higher loan rates. If inflation causes bank rates to rise, then deflation causes bank rates to drop and every investor knows (or should know) low rates hurt banks' Net Interest Margin (the spread difference between the interest banks pay on deposits compared to the interest banks charge for loans).Thursday, May 01, 2003 FIRST QUARTER UPDATE
I've been away the last few months a NEW COSMIC INVESTOR WEB LINKS: bit dispondent over the gloomy attitude many investors have regarding my efforts Scroll down Cosmic Investor home to educate them. Why bother, I often page to OTHER NEWS SOURCES for wonder. Well, I'm rolling up my shirt links to THE CHARLOTTE OBSERVER sleeves and once again pontificating on and HOUSTON CHRONICLE as regional the markets. adjuncts to The New York Times, Los Angeles Times and Chicago I sold my gold mining stocks and moved Sun Times. into more traditional blue chips such as SEARS (S) and FORD MOTOR COMPANY (F) I like The Charlotte Observer and my longterm favorite, AMERITRADE (AMTD). for its ease of access and recent coverage of The Dixie As for gold, I think it is still fine for Chicks and feel the Houston short-term trading due to the SARS scare, Chronicle is more independent a possible U.S. war with Iran and Syria, The Dallas Morning News. European backlash against U.S. businesses, a weakening U.S. dollar and rising U.S. deficits but I don't see much longterm profits to be made anymore from gold. Just my opinion. The big fear of possible hugh U.S. losses in a war with Iraq as well as serous terrorist reprisals are no longer valid to many investors, so gold is moving on economic news. For the present I would keep my eyes on SUN MICROSYSTEMS (SUNW) and AMERICA WEST AIRLINES (AWA). I have been following AWA for several months and like its performance. It deals exclusively with North America, some 59 desinations in U.S., Canada and Mexico so may not be as effected by terroism and SARS. It also runs a well regard travel agency that together with its airline operations offers solid vacation packages. Inside Flyer Magazine recently awarded AWA the "Freddie Award" for best Elite-Level frequent flyer program based on some 250,000 frequent flyer voters (CLICK HERE). AWA was also recently upgraded by Deutsche Securities and there has been some stong insider buying of its stock by Par Investment Partners, L.P. (CLICK HERE). I believe once the economy fully recovers and people start taking nicer vacations, AWA's stock price could easily hit above $10 a share. Now as for SUN MICROSYSTEMS (SUNW), I think it's stock price looks great at the $3.00 a share range but it may full further. There is still solid insider selling even in the $3.00 a share range and SUNW will probably lower prices to attract more customers. So, I think it's worth following and worth considering a purchase at around $2.50 a share. Well, be in touch later!Wednesday, February 05, 2003 UPDATES ON PLP, GOLD AND GOODYEAR TIRE
PHOSPHATE RESOURCE PARTNERS LIMITED PARTNERSHIP (PLP), reported here on January 01, 2003, will not make a cash distribution for the quarter ended December 31, 2002 (CLICK HERE). And CLICK HERE for PLP's recent 2002 4TH Quarter and full year results. Furthermore, while some PLP investors remain bullish about DAP (di-ammonium phosphate, used in common fertilizers) prices will rise, another major producer (Australian firm, WMC RESOURCES LTD (WMC) saw DAP prices fall below US$150 a ton during the fourth quarter and expects prices to "stay around these levels," as demand from China slackens and world supplies increase. Some U.S. producers (PLP???) may even quit the business (CLICK HERE FOR ARTICLE). GOODYEAR TIRE AND RUBBER (GT), mentioned here November 21, 2002, has recently decided to stop paying dividends (CLICK HERE FOR DETAILS). I had foreseen as much and cautioned readers to wait for GT to truly hit bottom before bargain hunting its shares. IMHO, that time is now. GOLD PRICES are again moving up on fears of a U.S. war with Iraq. Yet gold mining stocks (the best way, IMHO, to play gold) haven't gone much beyond their 52 week highs. Gold mining share prices will probably spike upwards as war begins but fall very quickly as the war fails to linger. I'd say get out the closer gold mining stocks approach their 52 week highs. In fact I sold my COEUR D'ALENE (CDE) stock at the first of the year and bought into GT and AMERITRADE (AMTD). I paid through the nose for both. I knew they would fall in price but I didn't want anyone accusing me of driving down the market by not buying. Okay? I did my work, the rest is up to you.Thursday, January 23, 2003 SOME HIGH DIVIDEND STOCKS
UPDATED NOTE (THURSDAY, JANUARY 23, 2003: 7:30 p.m. EST) I'm still holding THORNBURG MORTGAGE, INC. (TMA), but believe it is interest rate sensitive in that as rates drop more people refinance their exisiting mortgages or take out new ones which helps TMA's business. As rates rise, however, the opposite occurs which may hurt TMA's business. However, I believe that rates will remain low for quite some time and that TMA's expansion plans will help make up for any business that would happen to drop. Meanwhile I am keeping an eye on TECO ENERGY, INC. (TE) since I feel it may drop futher as the economy worsens. Thus, as the economy improves and interest rates rise, TMA will probably drop and TE will rise, so I will at some point switch from one to the other but right now I think there is still money to be made on TMA. ********************************************************** Recently I came across some high dividend yielding stocks. What with the Bush administration push to end "double taxation" on dividends and money market funds yeilding a paltry 1.8% at most, a lot of investors are shopping around for high dividend yielding stocks. In fact, I have parked some of my "idle" in cash in one of them, THORNBURG MORTGAGE, INC. (TMA). TMA currently yields around 11.7% with its $2.34 annual dividend payments. TMA originates and acquires single family residential mortgages. It generates income for its investors based on the difference between the yield on its portfolio and the cost of its borrowings. Many other investors think I'm crazy for investing in this company during a time of low mortgage rates but TMA stcok has gone from around $16.49 in October, 2002 to around $20.15 just yesterday. It also recently released its year-end and Fourth Quarter results with stated earnings-per-share for 2002 up over 24% from 2001. The Chairman called 2002 "a banner year," CLICK HERE FOR 4TH QUARTER REPORT and the President said, "Our outlook for 2003 looks just as promising." TMA seeks to become one of the top 50 mortgage lenders in the U.S. with a 15 - 20 percent increase in business during 2003 "even though total residential mortgage originations in the U.S. are expected to decrease by at least 25%." TMA believes its business model is important "to ensuring consistent earnings and dividends over time" and has a stated objective of deliviering "a 15% plus annual total return to shareholders over time."TECO ENERGY, INC., DIV. YLD., 9.38%
This came to my attention through a CBS MarketWatch article on high dividend paying Fortune 500 companies. TE is a holding company the owns all the stock of Tampa Electric Company plus interests in various gas utilities, power projects and even coal. However, Fourth Quarter profit, reported yesterday, CLICK HERE FOR fell 23% on debt refinancing charges and adjustment 4TH QUARTER REPORT for the value of properties it is considering selling. I know many TE investors are concerned about the status of the dividend and trading for TE stock was indeed halted before the market opened, and has received CLICK HERE FOR CBS MARKETWATCH at least one down grade, but many people like its potential, ARTICLE ON HIGH DIVIDEND STOCKS including Kelley Wright quoted in the aforementioned CBS MarketWatch article. TE, which was off almost 5% to close at $14.42 a share, closed as high as $26.47 back in May, 2002 and as high as $32.62 a share back in May, 2001. Guess some folks feel at the $14.00 a share range, they might easily double their money when the economy improves.TORCH ENERGY ROYALTY TRUST (TRU), DIV. YLD., 21.7%
CAUTION: THIS COMPANY MAY CEASE OPERATIONS ANYTIME AFTER MARCH, 2002 AND ADDED EXPENSES MAY LIMIT OR CURTAIL ANY FURTHER DISTRIBUTIONS. THE TRUST DEPENDS ON OIL, GAS, AND COAL DEPOSITS, ALL OF WHICH ARE BEING DEPLETED. Since TRU is a Trust, it technically doesn't have CALL 302-651-8775 FOR earnings and its cash payments are called "distributions" MORE INFORMATION ON TRU instead of dividends, thus it doesn't usually register among most searches for high dividend yielding stocks. I came across it by accident. And while it may cease operations and/or distributions, I believe it has a healthy trading volume of some 37,000 average shares a day. According to documents filed with the SEC, The Trust was formed October 1, 1993 under the Delaware CLICK HERE FOR 4THQ Business Trust Act. Torch and Velasco Gas Co. are DISTRIBUTION REPORT owners of certain oil and gas properties (and apparently some coal deposits) in Lousiana, Texas and Alabama. Torch and Velasco created net profit interests and conveyed such interests to Torch which then conveyed them to the Trust in exchange for 8,600,000 units (or "shares" as it were) which were then offered to the public for trading via various underwriters cir: November, 1993. As a Trust, Torch is therefore supposedly not subject to NEXT EARNINGS ANNOUNCEMENT Federal income tax since the income, after having the IS FEBRUARY 17, 2003 company's general and administrative expenses deducted, is divided pro rata among the unitholders (or "shareholders," as it were) who are then taxed normally. Between Nov. 14, 2001 to Nov. 22, 2002 (if my math is correct!), TRU paid out some $1.15 in income distributions. The share (or "unit" as it's called) price for TRU back around Nov. 5, 2001 was $5.58 a share and it came down a bit from that a few days later. But at $5.58 a share an investor would have collected $1.15 in distributions, for a yield of 20.6% (again, if my math is correct!). This pretty much jives with the Yahoo finace page for TRU which lists $1.11 in distriubtions for a yield of 21.73 percent.Friday, January 10, 2003 EARNINGS, THE DJIA AND MARKET BOTTOM ....................................................................................... . UPDATE: JANUARY 29, 2003
. Since this report first appeared January 10, 2003 . several new earnings reports have been issued making . my estimated earnings per share for the Dow Jones . Industrial Average stocks as $1.70 instead of my . original estimate of $2.04 per share and my . caluclated Price/Earnings Ratio for the DJIA is . now 23.9 instead of my original calculation of . 20.82 (the 23.9 P/E is also more in line with . Yahoo's finance page P/E average of 23.2). . . I still believe the DJIA will fall a bit more, while . DJIA earnings on average must improve to around $2.72 . per share (from my original estimate of $2.66 per . share) to achieve a DJIA P/E ratio of 15. . . ....................................................... Originial text from Cosmic Investor, BreakAway Notes, January 10, 2003 Following the rising share price of My result was a P/E of 20.82, dviding the AMERITRADE (AMTD) leads me to consider average DJIA price per share by the average if the Dow Jones Industrial Average earnings per share. (DJIA) has hit bottom. A P/E of 21.59 would have to drop 30.5% to Some of the tough old investor birds equal a P/E of 15; thus either the DJIA needs out there have been waiting for the to drop 30.5% (to around 6,000!) or else the collective DJIA price/earnings ratio DJIA earning-per-share (EPS) need to improve to hit 14 - 15 before moving back into 30.5% to around $2.66 per share from my the market. estimate of the DJIA current average EPS of $2.04 per share. I've wondered, since Microsoft and Intel are now part of the DJIA and since neither I think it's more likely that EPS will improve of them has ever had a P/E ratio much below 30.5% than the DJIA will drop 30.5%; in my 30, is it even reasonable to look for a humble opinion. DJIA P/E of 14 - 15? Many market watchers feel the first quarter of According to last week's issue of Barron's, 2003 will see the last of poor earnings, with the DJIA P/E is around 21.59; and a rough maybe a couple more big market sell-offs. The calculation based on Yahoo finance pages market will probably hit bottom then. yields much the same figure. Get ready to load up on some bargains during Apparently it based on year-end earnings those sell-offs. IMHO. for the underlying DJIA stocks. Below is my table of the DJIA stocks, their Now, I'm no financial analyst wiz but I past four quarterly earnings-per-share and have painstakingly gone through the 30 Thursday afternoon's share prices. I claim stocks making up the DJIA and listed their no competence in this. Earnings are for the reported earnings for the past four quarters. most part diluted and reflect any charges. I added them up, took their average and divided that into Thursday morning's average I tried to list the oldest earnings first. DJIA share price. Some companies have already issued 4thQ earnings but for convenience I list them all as: (4thQ-2001) (1stQ-2002) (2ndQ-2002) (3rdQ-2002) THE DOW JONES INDUSTRIALS: QUARTERLY EARNINGS, P/Es AND RECENT SHARE PRICES Ticker 2001 2002 2002 2002 Total Mid Day P/E Symbol Company 4thQ EPS 1stQ EPS 2ndQ EPS 3rdQ EPS EPS Sh. Price Ratio AA Alcoa $0.40 $0.26 $0.27 $0.23 $1.16 $ 22.35 19.27 AXP Am. Express 0.23 0.47 0.52 0.52 1.74 38.19 21.95 T AT&T -0.39 -0.28 -3.49 0.06 -4.10 27.62 0.00 BA Boeing 3.26 -1.56 -0.59 -0.12 0.99 33.91 34.25 CAT Caterpillar 0.59 0.23 0.58 0.61 2.01 47.01 23.39 C Citigroup 0.61 0.93 0.78 0.76 3.08 37.43 12.12 KO Coca-Cola 0.06 0.02 0.47 0.42 0.97 44.14 45.51 DD Du Pont 0.12 0.55 0.71 0.40 1.78 44.30 24.89 EK Eastman Kodak 0.33 0.13 0.97 1.15 2.58 39.95 15.48 XOM ExxonMobil 0.46 0.30 0.40 0.39 1.55 35.44 22.86 GE Gen. Electric 0.39 0.35 0.44 0.41 1.59 25.82 16.24 GM Gen. Motors 0.60 1.39 2.63 -1.42 3.20 39.00 12.19 HON Honeywell -0.38 0.46 0.56 0.50 1.14 25.42 22.30 HPQ Hew. Packard 0.06 0.25 0.13 -0.67 -0.23 20.43 0.00 HD Home Depot 0.33 0.36 0.50 0.40 1.59 21.36 13.43 INTC Intel 0.78 0.45 0.07 0.10 1.40 17.21 12.29 IBM IBM 1.33 0.68 0.03 0.99 3.03 86.51 28.55 IP Int'l Paper 0.12 0.12 0.45 0.30 0.99 36.26 36.63 JPM J. P. Morgan 0.22 0.48 0.50 0.01 1.21 27.31 22.57 JNJ J'n & Johnson 0.49 0.59 0.54 0.57 2.19 56.74 25.91 MCD McDonald's 0.42 0.20 0.39 0.38 1.39 16.86 12.13 MRK Merck 0.84 0.71 0.77 0.83 3.15 59.89 19.01 MSFT Microsoft 0.40 0.47 0.44 0.23 1.54 55.59 36.10 MMM 3M Company 0.99 1.14 1.18 1.38 4.69 126.73 27.02 MO Philip Morris 2.88 1.09 2.30 4.34 10.61 41.20 3.88 PG Procter&Gamble 0.79 0.93 0.74 1.04 3.50 86.31 24.37 SBC SBC Com. 0.61 -0.02 0.55 0.53 1.67 28.97 17.35 UTX United Tech. 1.12 0.92 1.23 1.21 4.48 64.18 14.33 WMT WalMart 0.33 0.37 0.46 0.41 1.57 51.13 32.57 DIS Walt Disney 0.19 0.21 0.13 0.18 .71 18.16 25.58 Average Total EPS: 2.04 Average Share Price: 42.48 Average P/E (42.48/2.04): 20.82 CONCLUSION: I don't think the high P/Es of Microsoft and Intel will have any real effect on the DJIA hitting the traditional buy signal of a 14 - 15 P/E. A combination of an improving EPS and a falling DJIA could find a happy medium whereby a P/E of 14 -15 might indeed be achieved, probably in March - April 2003. CLICK HERE FOR CURRENT DJIAWednesday, January 01, 2003 A STOCK TO WATCH: PHOSPHATE RESOURCE PARTNERS
_________________________________________________ | | | QUARTER, PHOSPHATE EARNINGS aprox. PLP | PHOSPHATE RESOURCE PARTNERS, | YEAR PRICE/TON PER UNIT Unit Price | LIMITED PARTNERSHIP (PLP) | 4thQ 2002 NA NA $1.70 | | is a Limited Partnership which | 3rdQ 2002 $145.00 -0.01 2.25 | trades on the New York Stock | 2ndQ 2002 135.00 -0.08 3.15 | Exchange under the symbol PLP. | 1stQ 2002 134.00 -0.06 4.25 | | | As a general rule of thumb, | 4thQ 2001 123.00 -0.13 4.50 | publicly traded limited | 3rdQ 2001 119.00 -0.18 4.50 | partnerships consist of | 2ndQ 2001 132.00 -0.16 3.50 | one general partner (the | 1stQ 2001 139.00 -0.12 3.25 | corporation) and many limited | | partners (the investing public). | 4thQ 2000 138.00 -0.11 4.00 | | 3rdQ 2000 134.00 -0.09 4.00 | This means investors will probably | 2ndQ 2000 130.00 -0.02 6.00 | receive a Substitute Schedule K-1 | 1stQ 2000 132.00 0.04 6.50 | from the company by which to determine | | reportable income for tax purposes. | 4thQ 1999 131.00 0.03 9.00 | There's usually plenty of easy to | 3rdQ 1999 156.00 0.07 10.00 | understand instructions so it's not | 2ndQ 1999 168.00 0.23 10.00 | as complicated as it sounds and many | 1stQ 1999 176.00 0.26 11.00 | investors may end up not meeting the | | various requirements needed to report | 4thQ 1998 180.00 0.32 11.00 | anything. | 3rdQ 1998 182.00 0.26 10.00 | | 2ndQ 1998 178.00 0.26 6.50 | PLP is 51.6% owned by IMC Global, | 1stQ 1998 171.00 0.09 6.25 | which itself trades on the NYSE under | | the symbol IGL. IMC Global is the general | 4thQ 1997 175.00 -0.12 6.50 | partner and provides administrative | 3rdQ 1997 175.00 -3.54 9.50 | management all of which it assumed | 2ndQ 1997 176.00 0.30 11.50 | when it merged with Freeport-McMoRan | 1stQ 1997 178.00 0.28 12.00 | who was the old general partner of PLP. |_______________________________________________ | Both PLP and IGL are involved in producing, marketing and distributing phosphate, most notably "diammonium phosphate" (DAP) which is commonly used as an argricultural fertilizer. Together, PLP and IGL are among the world leaders at this. For the last few years, phosphate prices have been dropping and so has PLP's stock price but lately phosphate prices seem to be headed upwards and so may be PLP's stock price. In the 2002 Third Quarter Report (dated Oct. CLICK HERE FOR THIRD QUARTER REPORT 24, 2002) Douglas A. Pertz, Chairman and CEO of IMC Global said, "The third quarter continued to support industry consultants' forecasts that global phsophate market fundamentals are in the early stages of a multi-year recovery." Back in late 1998 and early 1999 when phosphate prices were around $176 - $180 per short ton, PLP's stock price often closed at or above $11.50 a share, or "unit," as it's called. Near the end of August, 2002, Business Week Magazine wrote favorably of the fertilzer industry mentioning IMC Global and Scott's Fertilizer as possible investment plays CLICK HERE FOR BUSINESS WEEK ARTICLE I prefer PLP because at just blow the $2.00 a share range it is much cheaper than Scott's or IMC Global. In fact it appears to be coming off its 52 week low of $1.65 a share (unit). PLP had been paying out a cash distribution anywhere from $0.03 a unit to $0.30 a unit but discontinued this in April, 2000 using the money instead to repay loans to IMC Global.Tuesday, December 17, 2002 NEXTEL MAINTAINS 2002 OUTLOOK
While the Dow, NASDAQ and tech stocks in general have been tanking, NEXTEL COMMUNICATION (NXL) has gone from a share price of $2.78 on July 02, 2002 to $12.82 Monday, December 16, 2002 (CLICK HERE FOR PRICE HISTORY). Outside players like Digital Radio LLC and Eagle River Investment International LLC have tons of planned sales on file but Chairman William E. Conway, Jr. has been steadly buying shares as have other key officers including a guy named Craig McCaw (whom some may remember as a founding father of wireless communications). (CLICK HERE FOR INSIDER TRADE DATA). This morning, December 17, 2002, the Reston, VIrginia company announced it still expects to add 1.9 million net subscribers for 2002 and is working with Motorola to double its network's voice capacity and intends by the middle of 2003 to have full nationwide two-way "walkie-talkie" radio service (CLICK HERE FOR NEXTEL OUTLOOK REPORT).Thursday, November 21, 2002 GOODYEAR, INKTOMI MOVING OFF 52 WEEK LOWS
GOODYEAR TIRE AND RUBBER COMPANY (GT) has had a spate of INSIDER BUYING lately, while GOODYEAR HISTORICAL PRICES INKTOMI CORPORATION (INKT) had a spate of INSIDER SELLING yet both appear to be moving strongly from 52 week lows. More or less, GT hit a low of $6.61 a share November 1, 2002 while INKT hit $0.25 a share INKTOMI HISTORICAL PRICES September 30, 2002. As of 12:00 Noon EST, GT was at $7.50 while INKT was at $1.26 a share. I don't know about INKT, it may be riding the GOODYEAR FACES ABESTOS LAWSUITS success of selling one of it's software lines to another company for $25 million but I think GT should drop in price next quarter on lower sales and a possible dividend cut, plus possible GOODYEAR 3RDQ REPORT abestos liabilities, analyis downgrades, and pension contributions. Meanwhile I look forward to COUER D'ALENE (CDE) INKTOMI UNIT BAGS $25 MILLION topping the $2.00 a share mark during the next six months on a U.S. war with Iraq. I will probably sell it then. AMERITRADE (AMTD)'s continued rise in share price makes no sense to me other than the Chairman and directors are probably still buying the stock. Hold AMTD if you bought; buy it on dips probably next quarter if you missed it the first time.Tuesday, November 12, 2002 AUSPEX INVESTORS SAY, "BUY! BUY! BUY!"
Sometimes surfing publicly traded company message boards can be interesting. To wit, the AUSPEX MESSAGE BOARD at Yahoo is brimming with praise and excitement for AUSPEX's stock, trading around $0.30 a share. There has also been some solid insider buying, (CLICK HERE). 3RD QUARTER results reported a larger net loss but also included a 13% gain in revenues, and recently certified a device that can work with StorageTek devices (CLICK HERE). AUSPEX SYSTEMS (ASPX), according to its profile, "Introduced the world’s first Network Attached Storage (NAS) server over a decade ago. Today, Auspex continues to play a visionary role in the industry, offering storage solutions that far surpass that of the competition. As a multinational corporation with offices in Europe, Asia, Latin America and throughout the United States, Auspex is there to meet the demands of the global business enterprise… "With the highest scalability and fastest performance in the industry, NS3000 network servers are used around the world for storage applications requiring information consolidation, secure Windows and UNIX data sharing from a single data image, and continuous data availability." CLICK HERE FOR AUSPEX HOME PAGEMonday, November 4, 2002 ECONOMIA REPORT AND ROUNDUP
Major elections are dawning this week It's been mentioned by some and many experts believe a Republican financial writers that the majority in the U.S. Senate would lead Index of Leading Indicators has to a mild if unsteady stock market boom. fallen four straight months and durable goods orders have been If Democrats retain the Senate then the well below forecasts. markets may continue to reflect the wild swings associated with the general air of It's not possible for interest uncertainty. to fall much lower. If they continue to drop and no economic Ever since Yahoo (YHOO) reported better stimulus results then the government than expected results the stock market has may be forced to give money away for been improving. Financial insiders at leading free: in other words, the government brokerage houses expect operating profits on would need to print more money, a average will gain some 12% - 14% over year form of "positive" inflation but 2002 levels with at least a 7% improvement in inflation just the same. operating profits for the Standard & Poor 500. Billions of dollars in options have However, in a bid to maintain margins, companies been exercised during 2002 and it's are expected to cut back even further on my understanding the amounts must be employment and consumer sentiment is still poor. deducted from corporations' reported earnings for tax purposes and this Foreign markets are extremely shaky and probably may tarnish the earnings picture for will get worse in 2003 making it even more companies. difficult for U.S. companies dependent on overseas sales. Also, U.S. industrial capacity is considered to be excessive which will lead to more job cuts yet wages are seen as continuing to increase adding more pressure to inflation. All in all, 2003 may see stock market rallies on the good news of profit growth but sharp declines on the poor economic news. Investors currently have discounted the gloomy economic news celebrating the mildly solid profit picture but economic reality should sink in particularly if the U.S. goes to war with Iraq. I'm looking for things to get a lot worse in 2003 before getting better.Thursday, October 24, 2002 ANHEUSER-BUSCH INSIDERS MAY BE DUMPING STOCK
Yesterday, ANHEUSER-BUSCH (BUD) announced its earnings for the Third Quarter. Net Income was up 14.5% on revenues that were up 4.8% and the company is shooting for 12% EPS growth for next year, yet the company's CLICK HERE FOR EXCELLENT stock price dropped around 4% and Morgan CBS MARKET WATCH REPORT Stanley stood by its recent downgrading. ON ANHEUSER-BUSCH (BUD) Seems the stock price is hitting a ceiling and I wonder if insiders are dumping the stock. Check out the INSIDER REPORT; seems like officers, including BUD's President, are planning to sell some 112,756 shares; and that's just for September, 2002. Could be a bad sign for next year's overall Dow Jones Industrials performance. Remember, my thinking is that 2003 will see the market hit 7,000 and probably below which will be a signal to buy.Thursday, October 17, 2002 ABAXIS SHOWING STRONG INSIDER BUYING
The stock market appears to have hit bottom for this year, A lull in war talk from the Bush administration has sent defense stocks and precious metal stocks nosediving, while better than expected results from Yahoo, IBM and housing continues to rally the stock market, but experts still expect things to get AUSTRALIAN STOCK MARKET worse in 2003. Market breadth is a problem as FAILS TO RALLY is jobless claims and sagging industrial production and retail sales. President Bush is still likely to go to war with Iraq, terroists are still likely to score at least one more successful attack, and companies are likely not to make much more progress. 2004 is still being seen as the year of success against terroism and a rebound in the nation's economy. It's amazing how well AMERITRADE (AMTD) is doing. I guess it's share price won't be slipping much below $3.50 and likewise I don't see COUER D'ALENE (CDE) rising much above $2.00 a share. Meanwhile, I noticed strong insider buying at ABAXIS (ABAX). There is a string of insider selling but it seems to be all related to one former Vice President (CLICK HERE); other officers appear to be buying. Worth looking into.Monday, October 14, 2002 THE BIG PICTURE
Whenver overall markets and individual stocks make large moves either up or down it's natural to be tempted to reverse one's outlook. Thus when silver, NOT ALL ROSY FOR GENERAL ELECTRIC which had been tracking gold as a hedge against inflation and global tensions, suddenly drops in value, many traders GENERAL ELECTRIC CEO JEFFREY IMMELT thought silver was no longer a hedge ANSWERS DOUBTERS' CONCERNS but was trading as an industrial commodity like copper or aluminum. And when stocks like Yahoo and General MANY COMPANIES' PENSION FUNDS Electric turn in surprizing earnings, MAY BE UNDERFUNDED, WILL COST BILLIONS some investors who had been preaching about a soggy economy heading further down begin thinking maybe the worse SOME ANALYSTS LIKE YAHOO, SOME DON'T is over and the economy is rebounding. Well, we need to keep the big picture in mind. Great for Yahoo, yet beware ONLINE AD REVENUES MAY DROP 8% that Yahoo's progress may be due much to its increase in market share via acquisistions and future quarters may not show as strong an improvement. NO MAJOR NEW SERVICE CONTRACTS MAY HURT IBM In fact, online revenue on which Yahoo depends may drop as much as 8% by year's end and another 3% in 2003 with no geniune rebound until 2004. Likewise, General Electric still hasn't provided any guidance for its 2003 expectations and agreed that many of its business lines are doing less than originally forecast. While IBM is expected to weather the stock market storm, analysts are concerned about a lack of major new service contracts. 5% of IBM's total workforce has been laidoff, including some 14,213 jobs cut from its services division. According to Merrill Lynch (if we can ever again believe anything they say) the dramatic drop in the stock market (where supposedly much pension money is invested) will force companies to charge billions of dollars to earnings in 2003 to shore up sagging pension funds. Ford and General Motors are expected to be hit exceptionally hard due to union pension rules. Remember, the Dow Jones Industrial Average almost broke below 7,000 just a few days ago, so there was bound to be strong bargain buying, but the economy remains weak. Retail sales were reported off by 1.2% for September, worse than the 0.9% drop that had been anticipated while the University of Michigan consumer sentiment index for October fell to 80.4 compared to 86.1 for September; again, analysts had thought the October index would be in the 65.7 range. I expect another strong sell-off this week. Wheather silver rises on industrial demand or as a hedge against bad times, I still like COUER D'ALENE (CDE).Thursday, October 10, 2002 COUER D'ALENE MAY DROP NEAR $1.00 A SHARE
When there's a sell-off on the markets all one can do is ask around to see why the big traders have sold. There's been a sell-off on silver and the reasoning is that future industrial demand seems weak. European traders (and Europeans in general) I take it thought President Bush would announce a forthcoming invasion of Iraq during his big speech at Cincinnati a few days ago. When Bush failed to make such a statement the Europeans assumed all was well between America and Iraq and began selling gold. When gold catches a cold, silver gets pnuemonia. All that's left is industrial demand which appears weak with the sluggish world economy. I'm told that a report from JP Morgan expects silver to hit near the $4.00 an ounce range, so COUER D'ALENE (CDE) could drop near $1.00 or less a share. Such a price would be an excellant buying opportunity in my opinion. OPEC is expected to slow oil production, Iraq is bound to violate inspection laws, heralding a U.S. invasion, and the U.S. economy is bound to get worse as global concerns over Iraq make international business more cautious and jittery. This should ultimately help move precious metal prices upward again.Wednesday, October 09, 2002 YOU CAN'T SPELL "BULLSHIT" WITHOUT "BUSH"
Much has been said about President George W. Bush's recent speech given in Cincinnati. Now look, the hard fact is, like it or not, every U.S. President, from Kennedy through Nixon, Reagan, Carter, etc., routinely gives truly important speechs from the Oval Office...not from the Cincinnati Art Museum! Thus, the speech Bush gave October 7th, 2002 really wasn't meant to be important, just some rah-rah chest pounding bullshit meant to put Democrats on the defensive as Fall elections near. Oooo! Saddam might get a nuke by Christmas! Better CLICK HERE FOR TEXT OF OF PRESIDENT GEORGE W. vote Republican! Yeah. Right. BUSH SPEECH, OCTOBER 7TH, 2002, CINCINNATI, OHIO Will Bush invade Iraq? I hope so! Gold and silver should go through the roof on such action. Overseas leaders, interestingly, saw some form of softening on Saddam in the Bush speech. I didn't detect any softening, but according to the experts (professional world market traders) much of the world thinks Bush isn't going to invade Iraq afterall, thus gold and silver prices collasped. I think the world is wrong. Bush sure as well will invade Iraq...when the time suits his political agenda. Yes. Bush is playing politics with Iraq. Big deal. We may as well cash in on it too. Major gold and silver fund managers have reportedly been selling to take quick profits and I'm sure they will be buying back on bargain hunting. The world at large, in my opinion, has little faith in George W. Bush. The man has no dimension, no depth and lost the popular vote! I keep saying, the value of any nation's currency is merely a reflection of the confidence the world has in that country's future and leadership, thus I see the U.S. Dollar falling as world confidence in Bush falls. As the dollar drops, precious metals should rise. Inflation, a screwed up U.S. economy, war talk, terroism, all should work to push up precious metal prices. Readers know I like AMERITRADE (AMTD), a long term play for when the economy finally does recover. I think AMTD will continue to fall in share price, so readers can take their time. Readers know I like COUER D'ALENE (CDE), America's largest silver producer. I think it's cheap right now and while very risky, I think it's worth buying today in the $1.40 a lower share price range. Gee...wish I could say there's been a typo on the stock screen and that Intel, Cisco, etc., are really worth one-hundred times what the boards say they are, but nope: those stocks are dead in the water and are going to stay that way for a long, long time, IMHO. Do yourself a favor. Look at AMTD and CDE, okay?Tuesday, October 08, 2002 AMERITRADE CLOSES BELOW $3.50 A SHARE
I've been saying that AMERITRADE (AMTD) at the $3.50 a share range is a bargain and I think it may fall even further. Again, AMTD could very well, IMHO, hit $15.00 - $20.00 or more a share, once the economy recovers! I think recovery is a ways off and there's plenty of time to buy into AMTD at bargain prices. My other favorite stock is COUER D'ALENE (CDE). It's America's largest silver mine. Silver prices have been dropping lately on fears that a slowing economy will mean less demand for silver and gold. Precious metal investors buy silver after gold gets too expensive and right now gold prices have been dropping on fears of a slowing economy. Also there's fear that a Leftist win in Brazil's presidential elections could spark a further drop on Wall Street on fears that lack of confidence in dealing with a Lefist administration may cause a default on Brazil's debt hurting U.S. banks. Foreign mining companies operating in Brazil may be hurt by a devalued real, the currency of Brazil. However, impending war between U.S and Iraq should spark gold buying as well as bargain hunting. To me, it's clear that traditional stocks are going to be hit even harder in the coming months. The Bush administration is not paying much attention to the global economy and that is going to hurt the U.S. balance of trade. Most, if not all, the big players in precious metals continue to feel strongly that gold and silver are poised for strong moves upward. I like CDE because it is cheap and I agree that precious metals are bound to move up on the growing uncertainties in the world.Friday, September 27, 2002 MAYBE SILVER LINING FOR PRECIOUS METALS
As I keep harping away here, AMERITRADE (AMTD) and COUER D'ALENE (CDE) are my two favorite stocks. Buy AMTD, IMHO, if you favor a rebound in the stock market and buy CDE if you favor a lingering recession. CDE has dropped a great deal recently from the Great New Cosmic $2.00 a share range to around $1.60 a share and Investor Link: in my opinion represents a strong buy. Likewise, THE BULLION DESK, any more bad economic news, plus profit taking, Daily Precious should send AMTD's share price downward allowing Metals Updates it to be bought at a great bargain. Precious metal stocks dropped yesterday on news that Barrick Gold may not reach earnings targets due to operating costs (CLICK HERE). There also has been strong selling aparently by funds but the selling may be over and bargain hunting should begin (CLICK HERE).Tuesday, September 17, 2002 AMERITRADE GOING PLACES
AMERITRADE (AMTD) was trading at around $3.22 a share just last week and is now over $4.00 a share. News is that the future looks bright for Ameritrade's merger with Datek (CLICK HERE). New accounts are increasing (CLICK HERE) and despite some selling by individuals there is still insider buying by several officers (CLICK HERE). However, I think the economy is still weak and will get weaker which will be bad news for Ameritrade but great news for the silver producer COEUR D'ALENE (CDE) which I am continuing to hold. Ameritrade also expects a big $65 million write-off next quarter (CLICK HERE) which should bring the price back down. I still think Ameritrade is where to be when this economy/stock market finally does recover (I seem to remember the chairman turning down a $15.00 a share offer claiming the stock is worth twice that); I just think there's plenty of time to wait.Wednesday, September 04, 2002 PRECIOUS METALS UPDATE
Just a note to remind my readers that I am still holding firm to my precious metals investments, mostly COEUR D'ALENE (CDE). It went up some 6% yesterday as the DJIA slid over 300 points. I am expecting CDE to hit $5.00 - $10.00 a share over the next couple of years. In my opinion, any drop in CDE over the next few days would be a great buying opportunity. It is the largest silver producer in America with gold holdings as well. I hope to continue holding my CDE shares for the long term, but others may prefer to make quick, profitable trades as I'm sure CDE share prices will go up and down on speculation. It's a matter of market timing and I'm lousy at that. However, I've noticed that AMERITRADE (AMTD) is around $3.40 a share and tends, in my opinion, to rebound strongly when the overall market rebounds. Precious metal stocks, conversly, drop in price when the overall stock market rebounds and tend to go up when the market drops, in my opinion. So, one could day trade AMTD and CDE. As one goes up, the other will go down and vice-versa. I expect the world situation to worsen. Afghanistan, in my opinion, is very unstable and the puppet president America has installed there may be overthrown sooner rather than later. One attempt has already been made on his life and he now has U.S. forces protecting him, apparently not trusting his own men. I think the Bush Administration is in a hurry to invade Iraq because it fears Afghanistan may soon collaspe and the U.S. won't be able to fight that war over again and still invade Iraq. Israel and Palestine, India and Pakistan, North and South Korea...ah yes, I really do see things getting worse before they get better. Imagine if terroists take over a jet plane by impersonating U.S. Sky Marshals! Indeed.Friday, June 14, 2002 BACK TO PRECIOUS METALS
Okay. I screwed up on buying into RAZORFISH (RAZF). I was actually hoping against hope that a "normal" stock still existed for making money in this market. Well, BACKYARD BURGERS (BYBI) still looks hopeful, but I'm back into precious metals, mostly gold/silver mining stocks, particularly COEUR D'ALENE (CDE) which I bought for around $1.88 a share at the end of last month (May 28th). I also cashed my stock based mutual fund (at a hugh loss) and bought into the investment company's precious metals mutal fund. That's my opinion. Buy into COEUR D'ALENE (which I think is still undervalued) and transfer any stock based mutual funds accounts into precious metals funds. For those funds without a precious metal fund, I suggest looking into USAA GOLD FUND (USAGX). In my opinion, it is highly regarded and experienced in the world of precious metals investing. Precious metal prices have been heading upward since the troubled U.S. Presidential election results of 2000. Most, if not all, gold/silver mining company executives and analysts see gold prices hitting $350 - $370 - $400 an ounce during the next several years. CLICK HERE and HERE for gold/silver market news. Warren Buffet has some $600 million worth of pure silver bullion and Bill Gates has a 12% interest in silver mine, Pan American Silver (PAAS). CLICK HERE FOR ARTICLE CITING BUFFET/GATES SILVER CONNECTION. Now, with some profit taking selling among precious metals stocks, it is in my opinion, a fine time to be buying. PLEASE SCROLL TO BOTTOM OF THIS PAGE FOR MY EARLIER OPINIONS ON GOLD/SILVER.Friday, April 26, 2002 RAZORFISH, COME-BACK STOCK OF THE YEAR
Faithful readers may wonder what I have been doing lately. Well I've been chasing after quick day trades mostly among $2.00 a share NASDAQ stocks. I haven't been writing on these activities since timing is so crucial that by the time I post them on my web page the entire dynamics may have changed! However, I think I have found a stock worth holding for the longterm. That stock is RAZORFISH (RAZF). It has largely been trading at below $1.00 a share for about a year since revenues ending March 31, 2001 were off some 30% from the previous year (CLICK HERE). On February 25th of this year it hit $0.12 a share in intraday trading: that's twelve cents a share! (CLICK HERE). Then suddenly RAZF produced a profit for the First Quarter, 2002 (CLICK HERE) and the stock price doubled. Whereas daily volume was around 500,000 shares, the daily volume was up to over 60 - 70 million shares! Lately, RAZF has announced additonal funding from private stock placement (CLICK HERE) and its audtior has retraced its previous statement expressing concern about company as a going concern (CLICK HERE). I have dumped all my losers and loaded up on RAZF at around $0.37 a share. Let the games begin.Thursday, January 24, 2002 FAREWELL FINDWHAT.COM
Yesterday I supported FINDWHAT.COM (FWHT) for the longer term; probably will have a nice quarterly report sometime in mid- February. But today I dumped the sucker at around $3.37 - $3.38 a share. I took a hugh loss, but I'm a private investor answerable only to myself. Insider selling (CLICK HERE) and looming legal woes (CLICK HERE) are just too much to expect a truly great report. Stock may, in my opinion, hit the $2.50 a share range. I reinvested the meager proceeds back into another favorite of mine: BACKYARD BURGRER (BYBI) at around $6.78 - $6.79 a share. I think BYBI can hit the $9.00 a share range by summer.Wednesday, January 23, 2002 FINDWHAT.COM SHOULD REBOUND
FINDWHAT.COM (FWHT) is a difficult stock to day trade. It has closed lower in price for eleven consecutive days. Yet, according to my understanding of probabilities...that is not abnormal. Twelve, thirteen, or fourteen straight days would be abnormal, abeit it would be too late to matter at these prices! Thus I believe FWHT is due for a serious rebound. I think the next quarterly report, said to be due in mid February, should once again exceed expectations. I see a $4.99 - $5.02 stock price range within the next four weeks. I am holding and would suggest others consider buying more to dollar average down in price.Wednesday, January 16, 2002 COSMIC INVESTOR RETURNS
Many have wondered, what became of me? Did I go bust in the bear market? Did I get hired away by a big money management firm? Did I get married and settled? No, No, No. Just got bored there for a while, chasing girls, getting back in shape, that sort of thing. I haven't gone bust. Still have my original capital and then some. There's money to be made in this market by trading short-term. By on sell-offs and take whatever profit you can. Ironically, my last post here on November 29, 2001 suggested it was a smart time to buy back into FINDWHAT.COM (FWHT). Today, some six weeks later, it's still, in my opinion, a smart buy. I bought into FWHT yesterday at around $4.69 a share. I believe it will soon hit the $5.00 a share range, and if the next quarterly report is as remarkable as previous reports it could hit the $6.00 a share range. Other stocks I follow include, PLUG POWER (PLUG), BACKYARD BURGERS (BYBI) and ASK JEEVES (ASKJ). I also made some quick money on K-MART (KM) but don't recommend it now. And I still follow various silver/gold mining stocks which I believe can give some quick profits to nimble investors.Thursday, November 29, 2001 MAYBE TIME BUY BACK FINDWHAT.COM
Although I don't short stocks, I said yesterday was a fine time to short FINDWHAT.COM (FWHT). And today maybe a fine time to cover those short positions and start buying for the long-term. FWHT has never ceased to amaze analysts with its revenue stream and judging from the FWHT MESSAGE BOARD, investors are very bullish about this company.Wednesday, November 28, 2001 FINDWHAT.COM / ASK JEEVES TRADE CYCLE
It's been some three weeks since I last posted anything here; such are the trials and tribulations of a bear market. Interestingly, my last post is much the same as my new post: FINDWHAT.COM (FWHT) is a short-term trade. Right now it is rising, making it prime for short selling, although as a rule I don't short sell. Meanwhile, ASK JEEVES (ASKJ) which competes with FWHT is undergoing some heavy selling after moving up some 125% since the beginning of November, going from around $1.02 a share November 1st to around $2.30 a share November 26th. In fact in closed higher for sme six days in a row, despite being party to a class action lawsuit (CLICK HERE) I think the sell-off in ASKJ is a great buying opportunity. I am looking today or tommorrow, depending on my feeling about things, to sell my FWHT shares and buy into ASKJ.Monday, November 05, 2001 BACK TO FINDWHAT.COM
Well, I should have believed management. FINDWHAT.COM (FWHT) has been saying over and over that they have a proven formula for making customers money and that the World Trade Center attack would not effect earnings. Stock is up some 3 times since trading resumed September 17th. Record 3rd Quarter earnings just as management predicted (CLICK HERE). I have sold my AMERITRADE (AMTD) at around $5.59 a share and bought into FINDWHAT.COM at around $5.30 a share.Tuesday, October 16, 2001 REVERSING MY PRECIOUS METALS POSITION
Those familiar with me know I often Another key to selling gold/silver reverse my positions. If I seem eratic, mining shares is that several analysts well so does the market. Sometimes it seem to have gotten on the band wagon. takes insanity to combat maddness. When rank-and-file analysts start talking up an investment...it's usually (IMHO) I had been expecting something big to time to sell. happen. Well, I guess that would be the destruction of the World Trade Center. I have sold all my precious mining stocks And certainly, gold and silver prices and have bought into AMERITRADE (AMTD). went up. But the U.S. and her allies There has been strong insider buying by seem to have things under control. It's AMTD chairman/founder J. Joe Ricketts who doubtful that the Taliban can seriously apparently still believes AMTD is worth threaten stability in the Middle East. 4 - 5 times its current price of $5.50 a share. This is the key to precious metal prices. Make no mistake about it. Gold advances stronger than normal only if major countries are faced with certain collaspe. The U.S. may topple the Taliban but this will be welcome news to the Middle East and many rich moderate Muslim oil shieks will breathe a sigh of relief.Tuesday, September 25, 2001 WHY SILVER PROLOGUE
I'd say all religion in America has been Shah Reza Pahlavi of Iran, for example, watered down from many of its original ruled for over 30 years before his beliefs and practices. people finally succeeded in revolting, removing him from power. He tried to Fundamental Christians don't crush infidels "modernize" Iran by allowing women to between mill stones. Mormons have had to vote. Several fundamentalist Iranian do away with polygamy. Jews and other faiths Muslims were outraged. The Shah's cannot scarifice animals. Public stoning is notorius secret police (SAVAK) managed not allowed. to suppress most rebellions but in 1979, the people overthrew the Shah, replacing Islam, founded in 611 A.D. by divine revelation him with the Ayatollah Ruhollah to a wealthy Arab in Mecca named Mohammed, has Khomeini. remained remarkably true to its original tenets. Taking advantage of the shaky situation Contact with the West, especially with the in Iran, Saddam Hussein of Iraq invaded rise of the petroleum industry, has had its Iran in 1980. Afghanistan, fearing the effect on watering down Islam but millions in revolution would spread to its soil, isolated deserts and mountain villages still enlisted the Soviet military to help believe and live much as the first Moslems did. squash its rebels. The rebels rebuffed the Soviets and native Afghan Islamic And these simple peasants have given rise to fundamentalists called the Taliban took many rank and file Islamic militants who learn control. of the evils of Westernization at the knees of educated, well rounded, well traveled fanatics All this war: the Soviets, Saddam such as Osama bin Laden who wish to restore all Hussein, Islamic militants, caused many Muslim nations to the original faith by any wealthy, moderate Arab neighbors, like means necessary. Saudi Arabia, to begin hoarding gold in the advent their nation would fall With some 2 billion Muslims in the world, there next and they would need to make a quick are easily millions who side with the militants escape. By January of 1980 gold which had in spirit if not in fact. Any attempt at Mid been trading around $165 an ounce, hit as East moderation is not likely to last very long. high as $875 an ounce. Silver went from around $10 an ounce to an all time high of $52.50 in 1980.SILVER TODAY
Inflation as well as unrest in the Middle East Today's turmoil may not be as intense caused silver to rise in value in 1980, but so as back in 1980. Saddam Hussein may not did the Hunt Brothers of Texas who tried to be on the prowl. The U.S. is far less a corner the silver market. As word got out threat to moderate Islam than the old of their buying, others bought driving the Soviet Union. But Muslim fundamentalists price to the aforementioned $52.50 an ounce. are still a power to be reckoned with When the Hunts got a $100 million margin and are sure to emerge again and again no call they had to sell some of the silver to matter who is in power, keeping upward cover the call. As they sold, others panicked pressure on gold and in turn on silver too. and sold too and the price soon went back to the $10 an ounce range. The Hunts filed for Silver has practical industrial uses. bankruptcy. Kodak uses over 55 million ounces a year. Warren Buffett is not some gun-slinging Recently, back in 1997, famed equity investor Texas risk taker but a calculating man. Warren Buffett, began buying up some 20% of It's assumed he is still holding his some the world's available silver at around $5 an 130 million ounces of silver and may even ounce. When word got out about this in February be buying more, waiting perhaps for $10 of 1998, silver reached a nine year high of an ounce before he sells. around $7.23 - $7.31 an ounce. As silver mines quickly began producing more silver, and speculators pulled out, the price went back down. It's now around $4.50 an ounce.Monday, September 24, 2001 AFTERNOON UPDATE, 3:00 p.m., EDT
The markets are still up on bargain hunting Remember, recession is still looming speculation. But, remember by September 14th big in the U.S. and Asia. Terrorist notes, this may be the last major rally before reprisals may yet shake moderate Arab yet another crash. nations to begin dumping stocks, real estate and oil in favor of gold. As the markets reopened Septermber 11th, I mentioned that nervous investors could wait until after the China, who has always wanted access selling. I sensed a rally would soon occur among the to Russia's underbelly by way of blue chips with some profit taking among the precious Afghanistan could still come to the metal stocks. At this point (which is now, today) assistance of the Taliban. investors who have been waiting to sell their blue chips and load up on precious metal stocks have a Muslim rebels in Chechnya could also window of opportunity to do so. take advantage of the situation and step up their attacks on Russia which could hinder the allied war on terrorism.MORNING UPDATE, 10:00 a.m., EDT
Rapid market rally among blue chips and Nothing wrong with taking profits this sharp selling among gold/silver mining morning on COEUR D'ALENE MINING (CDE) or stocks, as moderate Northern Afghanistan HECLA MINING (HL) while one still can. Resistance Forces took over a small Afghan town once ruled by the Taliban. Town could But anything can happen. A strong, be key to more strategic takeovers. solid strike against a Muslim neighbor by the Taliban, or another successful Rumors also of British special forces already large scale terrorist attack by Osama lending Northern Resistance a hand. bin Ladin against the U.S., and gold/ silver prices will undoubtedly go through All this means less fear among Arab nations of the roof. I'm still holding CDE and HL. takeover by more extreme Islamic fundamentalists. It is this fear of Islamic extremism that causes more moderate Arabs to buy gold and silver. Oil prices are also dropping as world traders are more assured that OPEC will not be disrupted by the U.S. war on terrorism. Lower oil prices will help lower inflation. Inflation is another reason why investors would buy gold. Lower inflation means investors are less likely to buy gold.COSMIC INVESTOR ADDS NEW WEB LINKS
In view of the attraction of gold and silver related investments, Cosmic Investor has added several new gold/silver daily/historical pricing links to its homepage. Just click on HOME and scroll down to TECHNICAL INDICATORS.Friday, September 21, 2001 GOOD NEWS: ONLY 1,000 POINTS MORE TO FALL
I've been saying the DJIA would hit around 7,300 this year or next and stay there for 12 - 16 months. This is based on the fact that the historical average PE for DJIA stocks has been around 14. Below are the current DJIA stocks, their current PE and current price and what their price must be to yield a PE of 14 and a PE of 10. The corrsponding DJIA could be around 5,600 - 4,100. DOW JONES INDUSTRIALS COMPANIES: Closing Stock Symbol Price PE Price to Price to (09-20-01) Get PE of 14 Get PE of 10 Aluminum Co. of America AA 28.59 18 22.24 15.88 American Express AXP 26.10 16 22.84 16.31 AT&T T 18.13 NA NA NA Boeing Co. BA 29.80 9 46.36 33.11 Caterpillar Inc. CAT 41.69 17 34.33 24.52 Citigroup Inc. C 36.31 15 33.89 24.21 Coca-Cola Co. KO 48.35 37 18.29 13.07 DuPont DD 34.12 34 14.09 10.04 Eastman Kodak EK 32.58 15 30.41 21.72 Exxon Mobil Corp. XOM 37.02 15 34.55 24.68 General Electric GE 30.37 24 22.42 16.01 General Motors GM 41.70 16 36.49 26.06 Honeywell International HON 23.59 37 8.93 6.38 Hewlett-Packard Co. HWP 14.50 22 9.23 6.59 Home Depot HD 32.80 31 14.81 10.58 Intel INTC 20.67 28 10.34 7.38 Int'l Business Machines IBM 93.40 21 62.27 44.48 Int'l Paper IP 32.50 NA NA NA J. P. Morgan JPM 31.56 19 23.25 16.61 Johnson & Johnson JNJ 52.35 31 23.64 16.89 McDonald's MCD 27.37 21 18.25 13.03 Merck & Co. MRK 66.85 22 42.54 30.39 Microsoft MSFT 50.76 39 18.22 13.02 Minnesota Mining & Mfg. MMM 90.32 24 52.69 37.63 Philip Morris Cos. MO 47.43 13 51.08 36.48 Procter & Gamble PG 72.81 36 28.32 20.23 SBC Communications SBC 45.90 19 33.82 24.16 United Technologies UTX 41.64 12 48.58 34.70 Wal-Mart Stores WMT 45.31 32 19.82 14.16 Walt Disney CO. DIS 16.98 93 2.56 1.83 DJIA: 8,376.21 5,810.24 4,150.77Wednesday, September 19, 2001 THINGS ARE GETTING WORSE
Readers may want to see me update my notes Thousands of companies are already during this time of crisis but I really expected to lower their earnings have nothing new to say. estimates because of fallout from the World Trade Center beating. Things have been getting worse since George W. Bush beat John McCain in the South Tens of thousands more will be losing Carolina primary back in the summer of 2000. their jobs. I guess "insiders" knew then old George Bush, Recession is a sure bet. Sr. was planning a coupe with his idiot son G. W. installed as a puppet and started buying I still say stocks of silver mining into gold and silver stocks. companies are undervalued, but won't be for long. I like COEUR D'ALENE (CDE) The current Bush administration is a rehash of and HECLA (HL) and am long both. the old Desert Storm cabal spoiling for a fight with anybody in the Middle East. I just hope I said it before: a lot of diehard the Bush government allows us to capitalize on Republicans are crusty, old gold hoarders it by trading gold/silver stocks. and won't rest until they see $900.00 an ounce gold. CLICK HERE FOR ECONOMIC NEWS ROUND-UPTuesday, September 18, 2001 SOME OF MY RECENT TRADES
Yesterday I sold my holdings in FINDWHAT.COM (FWHT) The markets have been looking for between $1.54 - $1.60 a share and sold my holdings direction and U.S. President George in NATIONSRENT (NRI) at between $0.25 - $0.27 a W. Bush has finally provided a share and bought into COUER D'ALENE MINES (CDE) definitive vision for his term: war at around $0.80 a share and HECLA MINING (HL) at and recession. Trade accordingly around $0.95 - $1.00 a share. (see Cosmic Investor Special, September 14, below for details). I see a recession coming which will be long and bitter and expect both FWHT and NRI to be lowering earnings estimates sometime in the near future. I think both CDE and HL are great buys at or below $1.00 a share. Sharp rallies in precious metals stocks and defense industry stocks may lead to profit taking sell-off...great opportunity for shorts, particularly NEMONT MINING (NEM) and ALLIANT TECHSYSTEMS (ATK). And, IMHO, these stocks are also great to buy on any weakness.Cosmic Investor Special, September 14, 2001
BLACK HOLE MONDAY
Make no mistake about it, regardless of who STOCKS FOR THE NEXT 3 - 4 YEARS: you voted to be U.S. President, the United States of America is going into recession. ALLIANT TECHSYSTEMS (ATK) ATK is a $1.6 billion aerospace and defense Many of us could not believe things would company with leading positions in propulsion, get this bad this soon, even myself who kept composite structures, munitions, and precision fearing something of this magnitude would capabilites. Assumed to be the Pentagon's happen. chief munitions supplier. (CLICK HERE FOR LATEST QUARTERLY REPORT) And I dare say, we might as well face it: things are going to get worse. The "war LOCKHEED MARTIN CORPORATION (LMT) against terrorism," even by G. W. Bush's LMT is a $29 billion aerospace/telecom company estimation will last at least for the remainder known primarily for its U-2 spy plane. Recent of his term in office. And, contrary to popular earnings already tripled from last year. belief, war is not good for the economy. It (CLICK HERE FOR LATEST QUARTERLY REPORT) creates uncertainity and disrupts markets and causes supply and demand shortages. CBS MARKET WATCH DEFENSE STOCKS WRITE-UP Be prepared for companies to now issue new CBS MARKET WATCH MARKET ADVICE WRITE=UP downgraded earnings estimates to reflect the new slowdown not only from the decimated World Trade CHEVRON CORPORATION (CHV) Center but from businesses and consumers taking The machinery of war will need lots a wait and see approach to any new spending. of oil and Chevron's recently approved merger with Texaco makes it the No. 2 Most experts agree, Monday morning, September oil company in the world. Proven reserves 17th, 2001 will see enormous volume and it could be double that of BP Amoco. will be difficult for many investors have their Bush chief foreign policy advisor, orders filled at desired prices. I expect a hugh Condoleeza Rice used to be on CHV's board sell-off...but also a slight rebound. This rebound of directors. I expect it will do well. may be as soon as late Monday afternoon, or take (CLICK HERE FOR MERGER REPORT) 1 - 2 weeks. But I will undoubtedly be selling as soon as I can sense a rally. EOTT ENERGY PARTNERS, L.P. (EOT) Big Texas based indie marketer/transporter Understand, the selling by myself and others will of crude oil in North America. Second not be from panic or fear but from a change in Quarter net income rose 24%, full year economic growth. No more high tech/smokestack earnings target raised 58%, all while growth. The growth will now be in defense industry market conditions were seen as "less stocks and precious metals, in my humble opinion. favorable" than a year ago. 8.4% yield. (CLICK HERE FOR LATEST QUARTERLY REPORT) If you must sell into the downturn Monday, I suggest selling a few rounds of stock at a time. COEUR D'ALELNE MINES CORPORATION (CDE) Dumping all your shares at once is more than Well, this one is extremely risky. likely to work against you. Forget trying to It is the largest of U.S. located silver save a few dollars on added commissions. Sell producers. Silver prices are rather low, a few shares at a time to gather a sense of the but if gold prices continue soaring, market and trade executions. investors will soon be buying silver. At 75 cents a share, CDE could hit I have no guaruntee the Bush Administration will $4.50 a share, where it was about two co-operate, but I am hoping Bush will wait a week years ago. Lots of debt and CDE could or two for the markets to settle before launching dilute its stock by issuing more shares any major attack. I am guessing the major attack in lieu of dividends to its 13.375% will occur sometime around 10 - 11 a.m. New York convertible junk bond holders. City time, the morning of October 2nd, 2001. It (CLICK HERE FOR LATEST QUAERTLY REPORT) will be around midnight then in Afghanistan and (CLICK HERE FOR JUNK BOND INFO) there's a full moon scheduled for Oct. 2nd. I suspect, Colin Powell is "old Army" and prefers the light HECLA MINING COMPANY (HL) of a full moon which is helpful for forces to keep Like Couer d'Alene Mining, Hecla is also their bearings when all else fails and all hell is a big U.S. based silver producer with a breaking loose. bit of financing woes as 5.7 million new shares issued via a private placement are At any rate, again I have no guaruntee the Bush poised to trade on the open market one Administration will accomadate the markets, but I year from now, plus there's a water do hope he will wait a couple of weeks for Wall quality lawsuit looming in background; Street's selling/buying frenzy to settle. During but at 85 cents a share, the risk may be this time I intend to sell my holdings in worth it to some. It was trading at $6.00 NATIONSRENT (NRI) and FINDWHAT.COM (FWHT) and a share back in May, 1998. buy shares in COUER d'Alene (CDE); the largest (CLICK HERE FOR LATEST QUARTERLY REPORT) silver producer located in the U.S. (CLICK HERE FOR PRIVATER PLACEMENT DETAILS)Cosmic Investor Special, September 12, 2001
U.S. ECONOMIC PROSPECTS UNDER PRESIDENT GEORGE W. BUSH
NOTE: This report was written with the working date of AT THIS POINT THE BEST September 7, 2001, four days before the horrendous attack INVESTMENT MAY BE TO on America by an unknown source. I am not worried about YOUR LOCAL RED CROSS current conditions. America is like Mike Tyson. Being the champion of the world doesn't mean you can't get blind- RED CROSS VIA AMAZON.COM sided and knocked on your ass but you come back up RED CROSS ONLINE DONATIONS swinging. By Telephone: 1-800-HELP NOW By Conventional Mail: Our country has suffered blows before: the burning of AMERICAN RED CROSS DISASTER RELIEF FUND our Capitol during the War of 1812; General Custer's P. O. Box 37243 defeat at Little Big Horn; the War Between The States Washington, D. C. 20013 Presidental assassinations, the attack on the U.S. Navy (make check out to: ship, Maine; lynchings, Prohibition. We will rebound; AMERICAN RED CROSS DISASTER RELIEF FUND) I am sure of that. On September 7th, calling for a DJIA 7,000 - 7,900 by WITH THE MARKETS CLOSED, Fall's end seemed ludicrous; thus I postponed it to the I AM FOREGOING THE LIST Fall of 2002. However, I still maintain things will get I HAD PREPARED OF STOCKS worse before getting better and the markets are not likely BEATING THE DOWNTURN. to recover until after Fall 2002. This report follows word for word, just I had it planned as of September 7, 2001. OFF HAND, I WOULD SAY BUY GOLD MINING STOCKS, We mustn't forget that George W. Bush did not win the OR JUST HOLD THE STOCKS popular vote. And despite all recount efforts nobody has YOU ALREADY OWN UNTIL yet figured out how many Patrick Buchanan votes should THINGS TURN AROUND IN have gone to Al Gore. Had Bush any decency he would have 3 - 5 YEARS. resigned the Presidency at the start. Nor can much be said about a man who speaks English less well than the President FOR THE BRAVE, THERE of Mexico where it's not even his native tongue. SHOULD BE SOME GREAT BUYING OPPORTUNITIES, My outlook for the U.S. economy under President George PARTICULARLY BLUE CHIPS. W. Bush is that things will get a lot worse before getting better. Unemployment will continue to grow; tax revenues will drop; Americans will be called upon to tighten their belts in the wave of Federal government spending cuts, and the world outside America will become more dangerous making it less safe for American global businesses. I expect to see a Dow Jones Industrial Average in the 7,000 - 7,900 range, with a corresponding drop among most New York Stock Exchange and NASDAQ stocks of 30% - 55% before the bottom is seen. Things will probably hit bottom in the Fall of 2002. Market crashes have typically occurred in the Fall of the year and I think the recent sell-off is just the beginning. I look for several more 250 point losses in the DJIA which will probably close below 9,000 by November - December and limp along for most of 2002. Thus, by October of 2002, the time will be right for buying. Trouble in the Middle East directly effects the price of gold which in turn effects the strength of the U.S. dollar. Likewise, the value of the U.S. dollar is a direct vote of confidence or lack thereof in the U.S. Presidency. Since the plight of the U.S. Navy spy plane in China back in April, 2000, George W. Bush and his administration have exhibited a total lack of world leadership and global domination. Gold prices and shares of gold mining companies have been rising since the November, 2000 crisis developed with the American presidential election. The growing unease around the world continues to fuel gold prices. Keeping the world safe means making it safe for U.S. capitalism and Bush is not up to the job. Rather than meeting with Arab and Israeli leaders to open a dialogue for peace, George W. Bush President of the United States of America would rather host a state dinner for his friend, Vincente Fox, the President of Mexico. America's security depends on dialogue with Asia and the Middle East...not friends across the Rio Grande. I am assuming the U.S. Secretary of State Colin Powell wants Israel to emerge triumphant, vanquishing the PLO for once and for all. True, a strong Israel and a destroyed PLO will lead to stability in the Middle East, but it will be a bloody, violent process which will continue to rock U.S. corporations' overseas profits. Thus do I say things will get worse before getting better. The Bush tax rebate is another example of this man's lack of vision and inability to lead. While a wealthy few are receiving four, five and six figure rebates, the vast working class of America is seeing only $20.00 or a few hundred at the most. It would have been better to have saved the U.S. budget surplus for a rainy day, for when these workers will need unemployment compensation and Medicaid assistance. It seems the poor working class were convinced by the Republicans that they could be rich too, if only the liberal Democrats were voted out of office. Now the working class will be forced to lower their wages and standard of living to compete with Mexican labor. And while this may benefit a few corporations, it will hurt the overall U.S. economy. Democrats tend to try to benefit large classes of people while Republicans tend to try and benefit a few well connected individuals. Thus do I see a trend for Texas based firms to do better than their non-Texas peers. Texaco, Inc., for example, with roots going back to 1902 Texas, has had its shares perform much better under Bush than the Exxon Corporation whose roots go back to Rockefeller and the Eastern capitalist establishment of 1882. While some think lower taxes will generate greater tax revenue it needs to be pointed out that tax revenues actually dropped from between 1982 -1983 while the unemployment rate rose from 5.6% in 1979 to 10.8% by the end of 1982. And while tax revenues rose 140.3% between 1970 - 1979 from $192.8 billion to $463.3; tax revenues rose just 75.8% between 1980 - 1988 from $517.1 billion to $909.0 billion. From 1972 - 1979, tax revenues rose an average of 11.23% a year, while from 1983 - 1990 (under President Ronald Reagan's tax cut) tax revenues rose just an average of 6.71% a year. The drop in tax revenue growth could not be matched with a corresponding drop in Federal spending which led to deficit spending...sending the Prime Rate from from 6.75% to 15.5% between 1976 - 1979 and onward to 20.50% by 1981. Everybody wants the government to cut expenses except when there's a flood, drought, hurricane or forest fire then these same people are lined up with their hands out for Federal assistance. Bush himself is already looking to raise spending for education by some 10%. If Republicans feel Clinton increased government spending too much then why is Bush also increasing spending? If tax revenues under Bush grow by only the 6%- 7% as they did under Reagan and yet Bush proposes spending increases of 10% or more the result will be Federal deificits. And any suggestion of an unproven, costly Missle Defense Shield will just exacerbate the Bush economic problem. The tax cut under President John F. Kennedy took the top rate from near 94% to just around 70%, while Reagan's tax cut took that 70% rate and lowered it to around 52%. The Bush tax cut seems to be a modest 10% reduction...not enough to stimulate the economy but enough to make people feel some degree of uncertainty about their future. And while Kennedy was battling unemployment which had grown from 3.7% in 1957 to 7.5% in 1958; and while Reagan was fighting both unemployment and inflation, George W. Bush put forth a tax cut without any real need for it. A cut in the capital gains tax would have been nice, as well as tax exemption for reinvested dividends. But no, Bush thought he would follow Reagan's lead and give a tax cut which makes as much sense as addressing the issue of racial profiling by following Abraham Lincoln's lead to free the slaves. Americans are not clamoring for tax cuts; they are clamoring for leadership.Monday, December 04, 2000 GOLD STOCKS SEEM TO BE MOVING UP
A few weeks ago I mentioned that gold prices were flat and stocks of gold mining companies MONEX GOLD CENTER FOR were risky. I mentioned it as "proof" that the GOLD MARKET NEWS uncertainity surrounding the U.S. Presidential election was not that much of a crisis. Gold moves up on uncertainity, threat of inflation and major crises. Well, I still don't think the election is that big a problem and the price of gold still seems flat but gold mining stocks do HISTORICALLY, GOLD STOCKS seem to be moving up again. The reason is that the MOVE UP AS THE STOCK MARKET U.S. Dollar may be weakening against foreign currencies. HITS BOTTOM The strength of a nation's currency is a reflection of how much confidence the world at large has in that nation's ability to run things. The U.S. dollar may be dropping due to the Presidential issue but also because it has been rather overly high and should be trending downward. Add to this the fact that gold traders are short some ANOTHER WAY TO PLAY GOLD IS 4.6 million ounces. The last time they were this short THROUGH A GOLD FUND, AND I was back in September, 1999 and gold moved up some $60 BELIEVE USAA IS THE BEST an ounce as shorts covered their positions. Gold trading is very, very risky. If there is a big one day price move, I would suggest selling: gold rallies are extremely short lived. Buying gold itself can be expensive and complicated. Best left to professional gold dealers and mining companies hedging their operations. Most "average" investors play gold by buying shares of gold mining stocks. There are over 50 gold mining stocks on the various exchanges, but many are facing bankruptcy and several ANGLOGOLD HOME PAGE... are selling off assets to meet operational expenses, POOR INVESTMENT RIGHT NOW not to mention land claim lawsuits and environmental I THINK; BUT NICE PICTURES and labor problems. OF SEXY MODELS WEARING GOLD When considering a gold mining stock, look at the amount of reserves and production cost per ounce among other factors. I list below five, in my opinion, of the better ones.NEWMONT MINING (NEM)
Considered to be the largest U.S. gold producer and second largest in the world.
Has "provable and probable" reserves of 56.6 million ounces of gold.
Third Quarter gold production was 1.14 million ounces at a cost of $175 an ounce
(up $1.00 from last year)
It had a Third Quarter loss of $0.11 a share due to low gold prices and non-operating
items but that was smaller than the $0.23 a share loss last year. Cash flow was up
at $0.57 a share versus $0.23 a share.
I believe NEM is merging with Belmont Gold (BMG). NEM MANAGEMENT SAYS, "We expect an
excellent fourth quarter and remain on target to produce a record 4.8 million ounces
of gold in 2000 at a total cash cost of $173 an ounce. As a result, we will see a
significant improvement in cash flow from 1999."
I think it could hit $18.00 - $20.00 a share by Spring - Summer of 2001.
MERIDIAN GOLD (MDG)
Meridian got started back in 1981 as FMC Gold, then reorganized as a Canadian company
in 1996 and changed its name to Meridian Gold. There may have been a tax advantage in
doing this, but I'm not sure.
Has "provable and probable" reserves of 1,657,000 ounces of gold and 14.4 million ounces
of silver.
Third Quarter gold production was 112,000 ounces at a cost of $155 an ounce.
It had a record Third Quarter profit of $0.14 a share versus a loss last year of $0.05 a share.
Things have been going very well for MDG since it started operations at its El Penor mine
in 4th Quarter 1999. El Penor is estimated to have 894,000 ounces of probable gold reserves
and is expected to yield 250,000 ounces a year at the extraordinary low cost of $100 per
ounce. El Penor is located in Chile and is considered the driest place on earth. The mining
operation is expected to have little effect on the local environment. CLICK HERE FOR THE
THIRD QUARTER REPORT.
I think it could hit $6.50 a share by Spring, 2001.
BARRICK GOLD CORPORATION (ABX)
According to its HOME PAGE, "Barrick Gold Corporation is a leading international gold producer
with five low-cost mines in North and South America and three major mines under development.
The Company's shares trade under the symbol ABX on the Toronto, New York, London and Swiss
stock exchanges and the Paris Bourse. Barrick entered the gold business in 1983." Also claims
to have the largest market capitalization of any gold mining stock on the market.
Has "provable and probable" gold reserves of 59.3 million ounces.
Third Quarter production was 897,767 ounces at a cost of $151 per ounce (versus $137 per
ounce one year ago but down from the $244 per ounce cost of 1999 year end).
Its Third Quarter was the 2nd best Quarter in the company's history earning $0.22 per share
versus $0.20 per share one year ago.
Management expects its Fourth Quarter "to be its best ever, the Company is on track for
another record year. For the year, the Company is on track to produce 3.7 million ounces
at cash costs of US$145 per ounce." New projects should increase production by 35% by 2003.
On November 16, 2000 TRC Corporation made an UNSOLILCITED "MINI-TENDER" OFFER for 4% of
ABX stock at around US$13.00 a share ($20.00 a share, Canadian). "Barrick does not recommend
or endorse this unsolicited offer." CLICK HERE FOR THE THIRD QUARTER REPORT.
There is also a CREDIT SUISSE FIRST BOSTON "buy" recommendation.
I think ABX could easily hit $16.00 a share by Spring, 2001.
GOLD FIELDS LIMITED (GOLD)
According to Gold Fields' FIRST QUARTER REPORT, "Gold Fields Limited is one of the world's
largest gold producers with approximately four million ounces of gold production per
annum, 145 million ounces of mineral resources, and reserves of 70 million ounces. Gold
Fields is focused on increasing value at its existing operations and on international growth.
In addition to being listed on the Johannesburg (GFI), London, Paris and Swiss Stock Exchanges,
Gold Fields trades on Nasdaq (GOLD) through an American Depositary Receipt program and on the
Brussels Stock Exchange through an International Depositary Receipt programme."
Despite two earthquakes hitting production killing six workers (Gold Fields is a South
African company with most of its mines in Africa), First Quarter gold production was
973,000 ounces at a cost of $226 per ounce.
First Quarter earnings were $0.44 a share versus $0.69 a year ago. The drop in earnings
was due mostly to a write-down from a mine due to "lack of mining flexibility."
GOLD is not a great company but solid. Management feels, "Overall the operational trends
continue in the right direction, which is proof that our strategies are sound."
It is a low priced stock with potential. I feel it could hit $3.50 - $3.75 a share by
Spring, 2001.
HARMONY GOLD MINING CO. (HMY)
Another S. African company, Third Quarter results were down from the previous Quarter
with earnings of $0.12 a share versus $0.17 a share the previous Quarter. Production was
at 534,956 ounces with costs per ounce at $245.00 up from $234.00 per ounce the previous
Quarter.
The drop in earnings is due in most part to an 8.5% increase in wages and grade problems
with the gold ore being mined. The dividend also appears to have suspended.
The company "expects overall improvement in grade and tonnage ore in the forthcoming
quarter." But the big attraction I see here is that HMY may become a takeover target.
The CEO says, "We believe that the local and international consolidation of the industry
will continue to present opportunities to our company." I read that as an invitation for
a takeover. CLICK HERE FOR THE THIRD QUARTER REPORT.
Share price may hit $4.25 a share, but its the takeover factor that makes the stock
attractive, otherwise I'd avoid it.
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