MARKET ROUNDUP | |
Dow | -17.73 to 18,029.85 |
S&P 500 | -0.66 to 2,099.68 |
Nasdaq | +6.80 to 4,906.07 |
10-YR Yield | -0.079 to 2.066% |
Gold | +1.60 to $1,210.20 |
Crude Oil | -$1.83 to 51.70 |
“America First” was the mantra when it came to investing last year. But these days, that’s starting to change.
In the services I manage, in fact, I’ve recently recommended …
A Chinese energy giant that is too cheap to pass up — one that could rally another $30-$40 before looking pricey!
 A Brazilian bank that’s gotten beaten down by the plunging Brazilian real — but that could surge back if that currency decline is just about over, as I expect!
A pair of higher-yielding ETFs that invest in extremely undervalued securities issued in select, dirt-cheap foreign currencies.
|
|
I’m starting to warm up to foreign-oriented investments |
Naturally, I can’t share the exact names and tickers, or “buy” and “sell” levels, here. That wouldn’t be fair to my paying subscribers (though you can certainly get more details on how to join them by calling my customer service staff at 800-291-8545).
But the common theme should be apparent: After avoiding many of these foreign-oriented investments like the plague for a long time, I’ve warmed to the compelling value and opportunities available out there.
I’m not alone, either. Robert Shiller, the Nobel Prize-winning economist who (along with me) identified and condemned the housing bubble in advance, said he’s shifting money abroad because foreign shares are just so darn cheap. Billionaire hedge fund giant George Soros is shifting hundreds of millions of dollars to equities in Europe and Asia, regions Omega Advisors bigwig Leon Cooperman also expects to outperform the U.S.
The good news is, you can invest in foreign markets more easily now than ever before. There are a whole host of ETFs that track regions of the world and individual countries. There are also plenty of liquid American Depository Receipts (ADRs) that trade on the NYSE or over-the-counter here in the U.S., and which allow you to profit from moves in the underlying stocks in their home markets.
“You can invest in foreign markets more easily now than ever before.” |
Digging into them was largely a waste of time last year because the surging U.S. dollar hurt the value of most foreign investments. But the currency outlook is much more nuanced these days. So I’d start doing some research on the various iShares products that track foreign markets, as well as the listing of foreign stocks available from the Nasdaq website. Or consider getting on board with me, before this nascent rally in names like those I highlighted earlier turns into a full-on stampede!
So are you buying foreign stocks and bonds? Or do you think that’s just too risky? Any markets in particular that look extra-attractive? Any that you would avoid? And what do you think of investors like Soros — do you tend to follow their moves or just ignore ’em?
Hit up the Money and Markets website and let me know!
Our Readers Speak |
Greedy longshoremen milking the system and demanding overly generous wages and benefits. Businesses whining about the cost of getting goods from overseas … when it was them in the first place who insisted on shipping our manufacturing jobs overseas. The relative benefits and drawbacks of battery-powered or fossil fueled-cars.
You sure didn’t hold back when it came to discussing my recent columns!
Reader Bob said the costs of the longshoremen dispute on the west coast is being felt throughout the economy, particularly by the little guys. His take: “This slowdown has put many small businesses in dire straits (no pun intended)! Christmas trees arrived for New Year’s Day. Apples to help celebrate Christmas rotted in the containers due to delays. Customers are being lost daily. They’ll find reliable people to get their business done!
“We have three container ships parked in our bay today. Expect more. This never happened before! Big companies will survive. Smaller companies are being ‘deep sixed’ by the ports!”
Reader George said the blame lies with the union workers who are simply asking for too much. He added: “With salaries in the six figure-plus range, and a benefit package that exceeds most other workers’ actual wages, it would seem there is an over abundance of union greed with this Teamster ports problem. It’s a compelling reason that businesses that are abused by unions are going to more and more robotics.”
But Reader Jesse M. said there’s plenty of blame to go around on both sides. His view: “As some broadcaster recently described it, ‘the port labor problems are like the NFL and the players battling it out to see who can get the most money, because there is a lot of money to be made.’ The customer and the economy are the losers. Definitely not an acceptable system.”
Me?
I’m all for American workers getting a bigger share of the earnings pie. But it does sound like the wages and benefits packages being earned by dockworkers are darn generous compared to what many Americans make.
At the same time, it’s hard to shed many tears for companies like Wal-Mart who are facing logistics headaches. If they bought fewer foreign-made goods, and utilized more U.S.-based suppliers, they wouldn’t be in this … ahem … boat.
What about the auto debate? Well, Reader Gavin T. pointed out that the juice used to power battery-powered cars doesn’t all come from “dirty” fuels like coal or nuclear. His comments:
“You failed to mention hydro, wind, and solar when you identified where the electricity used to charge electric cars might come from, implying that electric motors are no cleaner than internal combustion. Come on, Mike, you can do better.”
But Reader Van B. said electric isn’t the way to go, and that fuel cell-powered vehicles make more sense. The comments:
“As far as electric cars, they are not the answer. It takes at least seven years of ownership to pay back the amount of energy needed to make the batteries in the first place, according to reports I’ve read. Not to mention the hazardous waste from used batteries.
“Hydrogen fuel cell powered vehicles are going to be the wave of the future as far as green transportation is concerned. Many of the large automakers are already getting ready to roll out hydrogen fuel cell powered vehicles very soon. Who wants to have to wait long periods of time waiting for their cars to charge when you could just fill up with hydrogen just like you would with gasoline?”
Excellent thoughts all around. I personally believe a range of technologies are going to be tried over the next several years, including electric, fuel cell, biodiesel, compressed natural gas, and more. It’s only through this real world testing and trial and error period that the industry will be able to figure out which gasoline-replacement system actually works for consumers — and which can be adopted by manufacturers in a cost-effective manner.
Â
Other Developments of the Day |
Ukraine’s army suffered a major defeat in the contested city of Debaltseve overnight, withdrawing to the west under significant pressure from pro-Russian rebels. It remains to be seen whether forces on both sides will now adhere to the terms of the cease-fire signed in Minsk a few days earlier.
As for the U.S. economy, housing starts fell 2 percent to a seasonally adjusted annual rate of 1.07 million in January. Building permit issuance slipped 0.7 percent to 1.05 million. Those figures were just a bit worse than economists were looking for.
What about inflation? It collapsed at the wholesale level last month. The Producer Price Index dropped 0.8 percent after falling 0.2 percent in December. January’s decline was the biggest since the government revised its data tracking method in November 2009.
Even if you strip out the impact of falling energy prices, you see that price pressures are generally easing further up the inflationary “food chain.” Or so says the gubmint!
It was a Beagle Blowout at the Westminster Kennel Club showdown in New York yesterday. The four-year-old “Miss P.” from Canada won the Best in Show award, and can now look forward to such rewarding and glamorous prizes as a meet-and-greet with Donald Trump and a part in the musical Kinky Boots.
Feel free to comment on these or any other stories at the website.
Until next time,
Mike Larson
{ 14 comments }
Re hydro, solar and wind
Most hydro power has been developed in N.A. The few that are planned (Peace River in British Columbia for example ) are being attacked by environmentalists.
In Ontario, Canada, they found that solar and wind power was 4 to 5 times more expensive than other electricity. They also had to build gas fired plants as backup for wind and solar. Wind and solar may be competitive in the future but right now they are not productive (can’t pay for themselves without subsidies) infrastructure
Mike Larson. You’re a good analyst, but your “Afternoon Edition” has no substance. You build it around your portfolio, but then pull the rug out each time with the old “you can’t see this unless you sign up for my newsletter”. I understand that you can’t give the names of your trades to anyone but your subscribers, but come on. I did enjoy your articles before the Afternoon Edition as they were very informative. This new format appears to be little more than a Facebook page in the “let me know what you think….” aka Please Like Me. Any way, I’m just venting. You can do whatever you like in your article, but you may end up harming your credibility, without substance.
Mr, Trimble, for me, “the harm” has already happened. I have been reading Larson for almost three years, I did not alway agree with him, but I respected his opinion because he said what he thought was right and did not equivocate. I thought through his reasoning in those instances when I did not agree, and that is beneficial to me. Now ? Not so much, The End-Of-The-World-As-We-Know-It script for his last sale pitch really turned me off. Reminded me of somebody from Stansberry Research. Then comes the “tell me what you think” campaign. Is Weiss turning into a public opinion survey group ? I do not knwo what Weiss wants to become, but it is not the organization I started listening to and subscribing to three years ago.
I always find it interesting that when it comes to anything related to unions the blame for the problems rests on the union member being to greedy. But then they hardly ever mention what the salaries of the executives are? If a union worker is paid $25 to $75 per hours it’s to much, but when executives make millions and not a peep?
I think it is unfortunate when any union or company can do so much damage to all of America for their own personal good especially when they already are one of the highest paid blue collar workers in the country and represent such a small number of members. I wish we had a President like Reagan who wold do like he did with the air traffic controllers but that will not happen with this administration. Instead many will suffer for the benefit of a few. The argument about the executives is stupid, it does no matter, they are not shutting down the ports. The grass is always greener on the other side of the fence and no one is happy with what they have. It is not the American way I was brought up with.
Bob, Google “William Domhoff Who Rules America” and get informed before you really embarrass yourself. The United States Middle Class grew strong during the 1950s and 1960s and most people in this country had a decent standard of living. Then about the time we were starting to help the really poor and disadvantaged, along came the “Great Communicator” leading the conservative revolution. I know, I worked hard for his election three times – 1976 Texas Presidential Primary, 1980, and 1984. I’m not going to get into a debate over the ATC union, but the union broke the law, and RR did what he had to do. He was not anti union, he had been a union president, but he had been a law abiding union president, and when the ATC union broke the law, he did what was necessary. The worst thing that came out of that conflict was the national general offensive to end collective bargaining in this country. Every conservative wannabe misinterpreted the action against the ATC union as Holy Writ without understanding why Reagan took the action, and the Middle Class has paid the price for 35 years.
I was going to sit out the 2008 election, but I heard an Obama speech in which he addressed the income disparity in American corporations, and he said he was going to do something about it, so I voted for the man. Not surprisingly, he has done nothing in the intervening 6 years, but then, he is a politician, and politicians are known for promising Heaven and delivering Hell.
If you enjoy the 1% Wealth Royalty standing on your neck, or if you enjoy the fact that the CEO of the corporation for which you probably work makes 200X, 300X, maybe 400X what you do, then keep drinking the Kool-Aid. The 1% has you right where they want you. Stupid and compliant. If you are tired of the other side having ALL the advantages, read “Who Rules America†and get really angry and do something to level the playing field.
It doesn’t look like the Ukrainians are in the same league as “the rebels”. Putin will supply them with whatever weapons they need to win while The West sends old blankets. The rebels will use the cease fire to resupply and infiltrate into the next city. Putin is playing chess while The West plays checkers. The Russians have lost most of their buffer states but I don’t think they are going to give up on this one, and may decide to take a few more back while they are at it. Who is going to stop them? Jim
Jim, “the rebels” are Russian Army troops equipped with Russian heavy armour and artillery – you think “rebels” could afford a few divisions of Russian tanks and just magically know how to operate them ? Read Reuters reports from the front. The fighting was heavy YESTERDAY, 3-4 days after the cease fire went into effect. I grew up during the Cold War listening to Kruschev and Breshnev lie through their teeth. Putin is an ex-KGB thug. He is not elegant like a chess player, he just lies, cheats, and steals at every opportunity. Look at a picture of the guy – look into those squinty little pig eyes. I’m not sure he is human, but I do know this. You are bever going to negotiate anything with that cretin. You wreck his country economically until the people throw him out of office, or you turn the western border of his “country” into a mile-wide devoid-of-life barrier with a 250,000 year radiation half-life. Unfortunately, I do not see a Presidential candidate in the foreesable future with the cajones to do that, so plan A seems to be the only choice.
The dock workers make too much money?? Their average of 142,000 would be over the top in……Mississippi, the average home price in California? $ 437,400, gas prices are second highest in the nation… to Hawaii. Given where they live, sounds pretty close to me,
Hydro power isn’t the clean fuel source that most think. It’s damage is immense. Over 50% of the Columbia River salmon spawning habitat has been permanently destroyed by dams. In China, whole cities have been moved to allow for dam reservoirs. You can rest assured that those displaced were not compensated as we would think was fairly.
Well, I bought ITUB at $22, it’s only $12 now. I’m skeptical about making $$ on this Brazil bank
Come-on guys, electric cars, fuel cells and other novice bad ideas. I like to see a electric car going up the hills in Duluth and also survive our cold weather. We have a very safe and abundant fuel called “natural gas”. We have it everywhere and we can suck it out of the ground in our back yard. If we suck it out in the gulf and something catastrophic happens – it just evaporates out of the water and out of the air, no environmental damage is done. Clean, does not pollute our air are or water. Keeps car engines clean and running, less maintenance. Drawback, not as powerful as gas. So the trade off is your not going to spin your tires in place like you can with a gas engine. Because of the abundance of national gas, it can be cheap, although you will need a little more of it in our car compared to gasoline, as it will give you a little less mileage.
Hey Mike, what is your take on the Utility sector lately? I did great in a related ETF up to the end of January 2015 then got clobbered over the last 3 weeks. You mentioned a trend change and what worked in 2014 may be opposite for 2015 so is that your view for Utilities as well?
Marc
I am skepticle but vigilant with these sights.