Money Talk

Eurozone is crumbling, Italy and Greece in sovereign debt crisis, France no better, high unemployment, low consumer confidence, flat incomes, increasing costs, etc. all of these no doubt is the perfect recipe for a pessimistic outlook of the world. IMF chief Christine Lagarde warned today about a lost decade for not just the developed world but for the whole world if wealthier nations don't intervene referring to the Germanys and USs of the world. These are sobering days of the times we live in. Here is atleast one simple solution, that is certain to increase housing demand and thereby can most certainly increase the confidence in the economy. We are at 9% unemployment in the US, which means more than 90% are still with jobs. These people need to be encouraged to spend more. Since the biggest investment for any family is their home, why not start from there. Almost all houses have lost their values by atleast 15% to 50% for no fault of the ordinary people. We should remember this

A movement that has kept everyone in power guessing where it will go or lead to. A leaderless, rudderless, moneyless movement, but letting their strong feelings out to show they have to do something just like how a baby starts crying if he needs to be cared for. A majority of people in the country and now the world seem to join in this silent revolution, of sorts. The big question is not what these protester are crying for, its what it will eventually achieve. I for one, feel, it is powerful and is gaining traction in terms of at least one important agenda. Sensitizing people on the ills of a overly exploited capitalistic world. Capitalism is unquestionably the best out there, but unchecked capitalism will lead to the exact situations such as these. Disparity of the rich and the middle.Class war. Resentment builds, and an unconnected and unnecessary  chain of reactions result that can be worse than the intent of the revolution. Incidentally, Nobel Prize winning Economist Paul Krugma

Today the world lost a brilliant technology genius. Steve Jobs (56). Sad loss. In March this year he was the 109th richest billionaire in the world. He was rich but not perfect. Read what he said to Stanford graduates in 2005 about a few things that may have made who he became. He always spoke with immense pride about what he and his engineers accomplished at Apple. "Your work is going to fill a large part of your life, and the only way to be truly satisfied is to do what you believe is great work. And the only way to do great work is to love what you do," he told the Stanford grads in 2005. "If you haven't found it yet, keep looking. Don't settle. As with all matters of the heart, you'll know when you find it. And, like any great relationship, it just gets better and better as the years roll on."

Continuing my search for clarity to the economic mess we happen to be in and how and when we may get out of all this, I found this brilliant expose based on a very smart Risk Consultant from Australia, Satyajit Das. Never have seen one of this calibre with the most deepest and clearest analysis. The news is certainly not good, but it is good to know what kind of reality we are in and for how long.....read on... http://www.marketwatch.com/story/5-money-moves-one-debt-crisis-expert-is-making-now-2011-09-29?pagenumber=1

I like when there is hope. How about you? I like when there is energy. How about you? If you want to learn where we can see one and how we can develop it, read this from the following link. I respect Chris Farrell who narrated it this morning in a program called Marketplace on American Public Media. http://marketplace.publicradio.org/display/web/2011/09/23/mm-its-a-great-time-to-buy-a-house/

We are living in unusual times. A once in a century phase. A rarity. Call it whatever you think best fits the situation. The truth of the matter is its real and its here to stay. What I am referring to is the economic woes of the present times. I am more than convinced that the summary of the present times is leading to most certainly the worst decade of economic opportunity and wealth building. In turn deterioration of living standards. Not just for the middle class but every class from the rich to the poor, in all countries of the world. One could endlessly debate the causes, the strategies, the lessons from history, etc., but no policy maker or political leader or pundit is sure as to which one or combination of measures will work to help us dig out from the hole. Most would agree that if one thing needs to be present for the economy to look up, it is confidence. Consumer confidence! This is at its lowest ebb. Experts are arguing about the approach to raise the confidence. But we

I was just shocked to read this powerful prediction aired in one of the popular financial website, Daily Ticker. Setting: St. Regis Hotel on Fifth Avenue, New York In Attendance: Financial luminaries and hedge fund managers, including Peter Schiff of EuroPacific Capital, John Tamny of RealClearMarkets, Dmitry Balyasny of Balyasny Asset Management and Scott Schweighauser of Aurora Investment Management Host: The Ayn Rand Institute Occasion: annual "Atlas Shrugged Revolution" dinner When: Thursday night, September 15, 2011 Stunning prediction: ARI president Yaron Brook tells ..... why Rand's devotees believe the global economy is "heading for collapse.....We can buy time but we can't change the outcome". The real problem: .....  is with the philosophical belief our society has that governments can solve problems and more rules and regulations are the answer to our economic ailments. Why: In a nutshell, Brook believes

Its really weird that when I wrote my Part I on this topic, I had some notes for Part II but how soon my notes become a thing of the past and something new emerges which is more "weightier" than the previous. By now you might have figured where I am going with this. Yes, its the hurricane, Irene. Not just because its a hurricane and it is headed towards the East Coast of the US. The bigger thing is, for the first time in the history of the USA, the Mayor of New York City has ordered evacuations in Manhattan - the financial capital of the world. That's huge, and what with all the power disruptions, infrastructure failures, not to mention the direction the stock market will tend to follow in the coming week/s. Ben Bernanke's talk at Jackson Hole, Wyoming seems dwarfed by the impact of Irene. Anyway he did not have much tangible to offer other than chiding the Congress to act! Who knows what that meant. I wanted to really talk a little about the European Bank crisis. I

Its been wild to say the least. Economy, Sovereign debt, Budget Deficits, Jobless Numbers, Industrial Production, Consumer Spending, House Prices, Assets, Stocks, Markets, and the list goes on. Every guy on the road knows what these terms are these days because it is being played out in our every day lives. I have hardly heard any assuring voice with a mature thought. It appears education and experience is just as good as a novice's  throw of dice idea of one should do in such a situation for both the short term and long term. I am disappointed honestly at the intelligentsia of this great country (US) and the corridors of knowledge, not to mention the seasoned brains of experience that lay scattered all over the breadth and lengths of this vast land. When we lose money in stocks, retirement funds, we are made to believe we don't have anyone to blame except ourselves because the investment decision is ours. This is a way how corporate and financial managers shield themselves f

World is busy absorbing many recent events, some sad, some good, some extremely good and understandably so. Its no surprise Japan is out of the news radar but not from the realities of the recent nuclear disaster. Many leading auto companies such as Honda and Toyota have had the greatest damage to their bottomline. The damages to the economy is still fresh. No one has the knowledge when these would be restored. Some say 6 months some say more than a year. It is so strange to me that Japan is still able to retain the number 3 position economically inspite of the 10 year long recession. Comparatively, US has almost emerged out of its recession in less than 3 years. That is some resilience. Economic drivers has a big role to play in this emergence. The biggest being the Debt that US has boldly taken upon itself. Its going to be a long time that US will see economic normalcy return. But for now incomes are growing and so also the spending. Lucky for those who still have an income strea

BTN and HOOK I covered in Sep last year have been pretty interesting on the rear view mirror now. BTN has lost about 8% as of now but had been hovering 10% higher or lower from the price point at about $8.20 from back then.  HOOK on the other hand has seen a very good uptick going from about $8 then to above $9 and about 10% but the good news is that its trend is strongly rising while BTN is either flat or moderately lower. Both stocks are in my kitty as good buys even at this price for a yearly gain of atleast 25%.

I have to report of two stocks Vasco Data Security (VDSI) and Hansen Natural (HANS) that have been steadily going up inspite of all gyrations in the market in the last 2 years after the recovery took hold. Third one is really a smart pick too, Reliance Steel (RS). I see a 50%, 25% and 20% upside respectively in the next 3-5 months. These three companies are all in excellent niche business environments for the present and may have very little negative impact from the current goings-on in the world.

I see some sharp reversals but a broad rally till the end of second quarter. Taking short positions in select tech and commodities stocks would be something to consider but prepare for a major reversal after 3 months. There are some daunting realities that US has to face....debt and deficit reduction and debt limits. There are estimates suggesting the indices could lose upto 50% from its current levels....ouch that could really hurt. So keep an eye on 50-day moving averages for reversals.

Japan is such a worry for the world currently as much for its own leaders. Radiation leaks into air, water and materials can find its way into almost everything from grains, vegetables, animals, meat, milk, sea food, fruits and finally into human beings over time indirectly and without warning as people may be taking in smaller quantities over time, what could prove to be highly risky or even fatal. Hypothetical as that may sound, there is nothing hypothetical about the thousands of lives lost and thousands more missing due to the direct impact of this month's tsunami.  The economic loss has been pegged at a whopping $300 billion! The US, which has twice or more of the GDP of Japan is still unable to square its deficits or debt obligations. And the US after having injected several rounds of stimulus funds borrowed from China and Japan among others still finds no light at the end of this long debt tunnel. One of the biggest of all stimuluses was the controversial, approx. $787 bil

Yes, the end is near, (not for the world), but for the tailspin of economic worries. How near? About 2-3 years or so, I would think. Why do I think the end is near you may ask. This is why. We got crushed with the excesses of unregulated free money (banks were the culprit) and its aftermath, now earthquakes and imminent fallout of nuclear catastrophe. Out of all destruction come good lessons and people learn prudence. When we get intensely punished for a protracted period of time (to me that is anything about or more than 5 years) we learn it the hard way to be prudent and innovative. The cause for this present metaphorically lousy climate for many people in the developed world is two fold. Natural calamity and man-made disasters. Right now the social unrest in the middle east coupled with natural disasters of earthquake and tsunami in Japan makes it a perfect storm of sorts. We are going to discover our roots and values. We will soon start living in reality and not in a galactic dre

There is a lot of vulnerability in the markets now especially after the recent bull run of the Dow Jones index. The head winds are metaphorically and literally of 'tsunami proportions'. There are many unknowns and many analysts are still only beginning to factor in the serious impacts of not only the actual tsunami in Japan but the after effects that may be even more chronic and severe from the fall outs of the nuclear plant effects. I see a big role for policy makers of the environment protection and preservation in the next 10-20 years. If they don't do a good job, we are all going to face increasing threats to our ways of life. Count the environment cost!

He is optimistic! There is not a single person who will not want to hear what Warren Buffett has to say, leave alone concur with him. In his annual meeting yesterday he has mentioned that his firm, Berkshire Hathway is itchingly wanting to buy $5-20 billion businesses with the horde of more than $40 billion they have in cash or equivalents. During the 2009 stockmarket crash aftermath he had said he is bullish about US. Yesterday about 2 years later and the Dow hitting the highest in 2 years, he says he is optimistic about US economy. I wonder how many would dare to differ. Here is a man who has seen it all and is down- to-earth and the only true doyen of investments. His vision is so clear and his view of the horizon still tells him that US has the unsurpassed human capital of ideas and an environment to make the ideas blossom into capital and cash flow. I could not agree more. What we as a people need is an ounce more of patience! Weeding out and skimming the froth which is what is

What a major revolt in the middle-east for more than a month now! Yet the stock market did not react till yesterday. We are over 100 points down today. Will it go down further? I think it has many reasons to go for a 5-10% correction. Oil wells in Libya are going to hibernate, uncertainty in Saudi Arabia which has a fifth of all oil reserves is going to weigh heavily, scandals in India, Japan's woes, China and its own social problems raising its ugly head when gets a chance, and the list goes on. But one of the more pressing reasons would be the employment rates in US. No signs of getting better. House prices are predicted to go down another 10-25% on the average, and there are analysts on CNBC who are saying that the housing bottom is a bath-tub shaped recovery and can last till late 2012 and early 2013. If you can see that far, we may not have gone into this recession in the first place. Bottomline, we need higher employment rates. No one is able to predict when that will happen.

Quite a climb! Don't you agree. Dow Jones climbed to its highest since its last pre-great recession high in late 2008. That is phenomenal. If only we knew what will two plus years will bring our way, we could all have been a millionaire had we invested about $250k during the dip. How dare can you ever do that. Not me atleast. But here's the thing. We are happy when the market climbs - its a little late because its after the fact and then we want to get into the market, when actually the best profits have already been made. We don't mind the crumbs when the risks are thought to be minimal. Wealth is made when the risk is the highest. We are wary because the risk can wipe your money as well. Is it any wonder thats why its called risk. It takes a long time for ordinary people to understand and ingest this concept of a healthy risk tolerance. Too long that it is sometimes too late. But I am confident, there are some great stories of profit prospects in growth and income sto