No summary of 2010, visual or otherwise, would be complete without an extensive overview of what pundits call Monetary Stimulus, quantitative easing or Large Scale Asset Purchases, and the peasantry calls, just as correctly (with a few footnotes), the printing of money. If there are two words that define what we had an absence and an abundance of in the past year, those would be jobs, and money. As some of the key jobs-related charts were presented yesterday, below, once again courtesy of BusinessWeek, are the main charts that among other things demonstrate the various currency manipulation playbooks, the price of gas in bacon and other products, the annotated strength of the dollar through time, and what is actually printed when the Fed does print money.
The first chart shows the progression of dollar strength (and weakness) with an annotation for contemporaneous global events. What is ironic is that while everyone realizes the world is still in a very week position, the core debate over who is weaker - Europe or the US, is sure to provide many hours of entertainment in 2011. And as a bonus, the man whose policies, together with those of Bernanke, are instrumental in just how weak the dollar gets, is presented in his key natural states: from lying just every so slightly, to lying a lot, to lying profusely to save his life, to lying at such a rate, it would make those whose pants are burning, blush with envy. And now you will know how to distinguish the four...
The next chart deals with the actual money printing, but not in an deeply philosophical manner, one in which hours of debate are wasted over whether trillions in excess reserves are actually printed money (even though the last time someone acquired USTs, MBS, and soon Munis and ETFs, with pixie dust, the legal consequences were not all that palatable). Of the just over $300 billion in actual currency printed in 2010, the vast majority was in $100 bills, next up was $20s, followed by $5s, $10s, and lastly, singles. Not a single $50 bill was printed. Also noted: the amount of cash in corporate America. Of particular interest: GM has more than half of its market value, or $27.5 billion sitting in cash. Lastly, and this not come as a surprise to many, the money multiplier: the money supply divided by the monetary base, is at near record lows, courtesy of the $1 trillion in excess reserves.
Another popular meme in 2010 was pricing X in Y, most often the stock market in gold, in which basis it is still down for the year, as gold (not to mention silver), despite the short memory of many, is by and far the best performing asset class of 2010. Those who followed our advice in early 2010 to avoid stocks and to invest in gold, are ahead of most. The chart below takes a comic approach to this relative performance, showing how much the price of gas changed when priced in other "currencies."
Last, and probably most interesting, is the graphic presentation of the currency manipulator playbook: in a world in which Ben Bernanke knows very well he has little competition when it comes to doing as he chooses with the world's reserve currency (for now), other sovereigns are forced to come up with their unique responses. The playbook below shows all the various defensive tactics adopted so far. Luckily, few offensive plays have been established to date. We doubt that will be the status quo for a long time.
And as John Taylor and many others have pointed out, now that the fiscal "stimulus" of the payroll tax has been exhausted in a few short weeks courtesy of the jump in crude oil, and any further fiscal intervention not likely to occur unless Congress wants another incumbent bloodbath next time around, as Americans are tired of subsidizing banker lifestyles, expect to see many additions to the FX manipulation playbook, as the year progresses and monetary intervention continues to be the only direct way of making sure every new banker bonus year is a record one is via the Fed and its ongoing dollar printing-cum-debasement. That said, should the bankrupt European house of cards continue to wave a white flag of surrender every 3 months, the race to the bottom may not have a clear winner well after 2011 is also history.
All charts courtesy of BusinessWeek
Everyone likes to be right and the easiest way to be right is to surround oneself with people and opinions that are predisposed to be similar to ours. When investing, it pays to be contrary. That sets you up to be wrong some of the time. The thing is, if you are right 60% of the time, and manage risk properly, there is a good chance you’ll make money. The most basic principle of investing is buy low and sell high. When doing this you’ll seldom hit the actual bottoms or tops; you are buying when the market is going down and selling when it is going up. That in itself is contrary to most retail investors’ practice of buying high and selling low.
Mutual Fund Flows and Sentiment as Contrarian Indicators
The majority of retail (casual) investors use mutual funds and ETFs (Exchange Traded Funds) to invest in the markets. Fund flows (deposits vs. withdrawals) are generally regarded as contrary indicators. This is a component of a broader series of indicators classified as investor sentiment that provide some insight into future directions of the market. The basic principle is: when many investors are bullish the market is more likely to go down and conversely a higher level of bearishness or negative sentiment indicates the market is likely to make a move higher. TrimTabs Investment Research reports on these fund flows and in a recent report stated:
We observed that equity prices tend to fall after equity exchange-traded funds (ETFs) rake in large sums of money. Conversely, the market tends to rise after equity ETFs post heavy outflows.
The report then issues this conclusion:
We have two explanations for the strongly negative correlation between equity ETF flows and future market returns. First, ETFs are traded mostly by retail investors and day traders. These are the least informed and most emotional market participants—the ones most likely to lose money over time. Second, we suspect hedge funds use ETFs when liquidity dries up. Hedge funds were forced to close individual stock positions during the credit crisis, so they bought equity ETFs instead. Equity ETFs posted large outflows in 2009, when liquidity improved.
These concepts are not really as complicated as they seem to be. It’s Economics 101. When demand outstrips supply, prices go up and when supply is larger than demand, prices go down. When funds are flowing into stocks, markets rise but at some point most people are invested and there isn’t enough uninvested capital left to drive prices higher.
Whatever the internal dynamics, the retail investors are generally the last to join in a rally and their main vehicle of investment are mutual funds and ETFs so large inflows into those instruments suggests that the market is near the top. That’s why many retail investors get the timing wrong and end up losing money. Nobody likes being wrong or losing money, it makes us feel pretty lousy about ourselves! This is borne out in the current rally where the retail investor is reticent to return to the markets after being burned so badly in the housing/banking crisis of 2008 – maybe one time too many in the last decade. As Adam Shell recently wrote in USA Today:
Yet, increasingly, investors on Main Street are not playing the stock market game with confidence like they used to, mainly because the game of making money has gotten tougher and more volatile since the financial crisis. Retail investors are buying fewer stocks. They are paring back on stocks and stock funds they already own. Instead, they’re moving into safer investments, like cash and bonds. “Investors are on strike,” says Axel Merk, president and chief investment officer at Merk Mutual Funds.
Fox News Doesn’t Make You Dumb. It Just Keeps You that Way
I don’t think the decision by retail investors to stay away from the markets is a good one. Markets have historically been a better investment than many other asset classes with the S&P 500 returning roughly a 7% annual rate of return. Stocks should, at the very least, be a strong component of a diversified portfolio. Instead of shying away from being wrong, investors – people in general – should expose themselves to a broader group of opinions, to alter unsuccessful behavior and improve decision making.
The findings of a new study, Misinformation and the 2010 Election, from the University of Maryland’s World Public Opinion show that 9 in 10 voters in the 2010 election believe they encountered information that was misleading or false, with 56% saying this occurred frequently. The study also concludes that those who watched Fox News almost daily were significantly more likely than those who never watched it to believe misinformation.
The bad news for FOX News viewers is that merely watching the channel appears to be toxic. Most voters believed a few whoppers during the 2010 election cycle. But daily watchers of FOX News believed more misinformation than everyone else.
The underlying problem uncovered by this study is that today’s news organization are not unbiased deliverers of the day’s events, these outlets are partisan interpreters of the day’s events packaged to appeal to their viewership or constituency. I don’t claim one network or source is a more egregious offender than another. Everyone is entitled to their opinions, but each carries a bias that should be understood before assuming what we are digesting is “news” and not opinion.
This Article is Biased
This article exposes some of my own biases. We all have them and those views can be positive as they give us the strength to make decision with confidence. Most of the stocks I own are lesser-known, yet-to-be-recognized small technology stocks. I short stocks that people recommend as buys, such as Coinstar (CSTR), and I shy away from momentum stocks with historically unjustifiable valuations. I believe you should never buy a stock for which you can’t make a historically significant case of undervaluation. In our markets his is contrary behavior, but it works, and it helps me sleep at night.
If we are making bad decisions, like buying market tops and selling bottoms like the recent bottom in 2008, it is positive to examine our biases and correct them where possible. The best way to correct faulty assumptions is to take in a variety of disparate view points and make informed decisions. We can’t do this confining our media consumption to sources that only reinforce our previously held views. Religion and patriotism should allow for independent thought and interpretation. We should all try to broaden our information sources in 2011 and perhaps we can overcome the ‘misinformation’ gap and make some more profitable investment decisions.
I hope technology positively affects your life in 2011 and all your stock investments are winners.
Steven Bulwa is an investment analyst with a focus on new developments in technology and the companies poised to benefit. He has contributed to TheStreet.com, Realmoney.com, Business Insider, Huffington Post and SeekingAlpha.com, among others. Visit www.bulwatechreport.com, or follow @BulwaTech, to learn about technology companies with true growth prospects for 2011 and beyond.
Follow us on Twitter.
Sign up for Mediaite’s daily newsletter.
robert shumake
Foot-and-Mouth Outbreak Spreads Through South Korea - AOL <b>News</b>
South Korea is suffering its worst-ever outbreak of foot-and-mouth disease, with the highly contagious virus spreading to farms across the country despite a nationwide quarantine effort.
<b>News</b> Corp. Online Gaming Head Sean Ryan to Head Facebook's Social <b>...</b>
Sean Ryan, who arrived at News Corp. mid-year to set up a new online gaming unit, is moving to Facebook to head partnerships at its key gaming platform, according to sources. Currently, Facebook does not create social games, ...
John Roberts switches to FOX <b>News</b> | Inside TV | EW.com
John Roberts, the veteran newsman who co-hosted CNN's American Morning for three years, is joining the competition. “We are excited to welcome Jo...
robert shumake detroit
Foot-and-Mouth Outbreak Spreads Through South Korea - AOL <b>News</b>
South Korea is suffering its worst-ever outbreak of foot-and-mouth disease, with the highly contagious virus spreading to farms across the country despite a nationwide quarantine effort.
<b>News</b> Corp. Online Gaming Head Sean Ryan to Head Facebook's Social <b>...</b>
Sean Ryan, who arrived at News Corp. mid-year to set up a new online gaming unit, is moving to Facebook to head partnerships at its key gaming platform, according to sources. Currently, Facebook does not create social games, ...
John Roberts switches to FOX <b>News</b> | Inside TV | EW.com
John Roberts, the veteran newsman who co-hosted CNN's American Morning for three years, is joining the competition. “We are excited to welcome Jo...
robert shumake
No summary of 2010, visual or otherwise, would be complete without an extensive overview of what pundits call Monetary Stimulus, quantitative easing or Large Scale Asset Purchases, and the peasantry calls, just as correctly (with a few footnotes), the printing of money. If there are two words that define what we had an absence and an abundance of in the past year, those would be jobs, and money. As some of the key jobs-related charts were presented yesterday, below, once again courtesy of BusinessWeek, are the main charts that among other things demonstrate the various currency manipulation playbooks, the price of gas in bacon and other products, the annotated strength of the dollar through time, and what is actually printed when the Fed does print money.
The first chart shows the progression of dollar strength (and weakness) with an annotation for contemporaneous global events. What is ironic is that while everyone realizes the world is still in a very week position, the core debate over who is weaker - Europe or the US, is sure to provide many hours of entertainment in 2011. And as a bonus, the man whose policies, together with those of Bernanke, are instrumental in just how weak the dollar gets, is presented in his key natural states: from lying just every so slightly, to lying a lot, to lying profusely to save his life, to lying at such a rate, it would make those whose pants are burning, blush with envy. And now you will know how to distinguish the four...
The next chart deals with the actual money printing, but not in an deeply philosophical manner, one in which hours of debate are wasted over whether trillions in excess reserves are actually printed money (even though the last time someone acquired USTs, MBS, and soon Munis and ETFs, with pixie dust, the legal consequences were not all that palatable). Of the just over $300 billion in actual currency printed in 2010, the vast majority was in $100 bills, next up was $20s, followed by $5s, $10s, and lastly, singles. Not a single $50 bill was printed. Also noted: the amount of cash in corporate America. Of particular interest: GM has more than half of its market value, or $27.5 billion sitting in cash. Lastly, and this not come as a surprise to many, the money multiplier: the money supply divided by the monetary base, is at near record lows, courtesy of the $1 trillion in excess reserves.
Another popular meme in 2010 was pricing X in Y, most often the stock market in gold, in which basis it is still down for the year, as gold (not to mention silver), despite the short memory of many, is by and far the best performing asset class of 2010. Those who followed our advice in early 2010 to avoid stocks and to invest in gold, are ahead of most. The chart below takes a comic approach to this relative performance, showing how much the price of gas changed when priced in other "currencies."
Last, and probably most interesting, is the graphic presentation of the currency manipulator playbook: in a world in which Ben Bernanke knows very well he has little competition when it comes to doing as he chooses with the world's reserve currency (for now), other sovereigns are forced to come up with their unique responses. The playbook below shows all the various defensive tactics adopted so far. Luckily, few offensive plays have been established to date. We doubt that will be the status quo for a long time.
And as John Taylor and many others have pointed out, now that the fiscal "stimulus" of the payroll tax has been exhausted in a few short weeks courtesy of the jump in crude oil, and any further fiscal intervention not likely to occur unless Congress wants another incumbent bloodbath next time around, as Americans are tired of subsidizing banker lifestyles, expect to see many additions to the FX manipulation playbook, as the year progresses and monetary intervention continues to be the only direct way of making sure every new banker bonus year is a record one is via the Fed and its ongoing dollar printing-cum-debasement. That said, should the bankrupt European house of cards continue to wave a white flag of surrender every 3 months, the race to the bottom may not have a clear winner well after 2011 is also history.
All charts courtesy of BusinessWeek
Everyone likes to be right and the easiest way to be right is to surround oneself with people and opinions that are predisposed to be similar to ours. When investing, it pays to be contrary. That sets you up to be wrong some of the time. The thing is, if you are right 60% of the time, and manage risk properly, there is a good chance you’ll make money. The most basic principle of investing is buy low and sell high. When doing this you’ll seldom hit the actual bottoms or tops; you are buying when the market is going down and selling when it is going up. That in itself is contrary to most retail investors’ practice of buying high and selling low.
Mutual Fund Flows and Sentiment as Contrarian Indicators
The majority of retail (casual) investors use mutual funds and ETFs (Exchange Traded Funds) to invest in the markets. Fund flows (deposits vs. withdrawals) are generally regarded as contrary indicators. This is a component of a broader series of indicators classified as investor sentiment that provide some insight into future directions of the market. The basic principle is: when many investors are bullish the market is more likely to go down and conversely a higher level of bearishness or negative sentiment indicates the market is likely to make a move higher. TrimTabs Investment Research reports on these fund flows and in a recent report stated:
We observed that equity prices tend to fall after equity exchange-traded funds (ETFs) rake in large sums of money. Conversely, the market tends to rise after equity ETFs post heavy outflows.
The report then issues this conclusion:
We have two explanations for the strongly negative correlation between equity ETF flows and future market returns. First, ETFs are traded mostly by retail investors and day traders. These are the least informed and most emotional market participants—the ones most likely to lose money over time. Second, we suspect hedge funds use ETFs when liquidity dries up. Hedge funds were forced to close individual stock positions during the credit crisis, so they bought equity ETFs instead. Equity ETFs posted large outflows in 2009, when liquidity improved.
These concepts are not really as complicated as they seem to be. It’s Economics 101. When demand outstrips supply, prices go up and when supply is larger than demand, prices go down. When funds are flowing into stocks, markets rise but at some point most people are invested and there isn’t enough uninvested capital left to drive prices higher.
Whatever the internal dynamics, the retail investors are generally the last to join in a rally and their main vehicle of investment are mutual funds and ETFs so large inflows into those instruments suggests that the market is near the top. That’s why many retail investors get the timing wrong and end up losing money. Nobody likes being wrong or losing money, it makes us feel pretty lousy about ourselves! This is borne out in the current rally where the retail investor is reticent to return to the markets after being burned so badly in the housing/banking crisis of 2008 – maybe one time too many in the last decade. As Adam Shell recently wrote in USA Today:
Yet, increasingly, investors on Main Street are not playing the stock market game with confidence like they used to, mainly because the game of making money has gotten tougher and more volatile since the financial crisis. Retail investors are buying fewer stocks. They are paring back on stocks and stock funds they already own. Instead, they’re moving into safer investments, like cash and bonds. “Investors are on strike,” says Axel Merk, president and chief investment officer at Merk Mutual Funds.
Fox News Doesn’t Make You Dumb. It Just Keeps You that Way
I don’t think the decision by retail investors to stay away from the markets is a good one. Markets have historically been a better investment than many other asset classes with the S&P 500 returning roughly a 7% annual rate of return. Stocks should, at the very least, be a strong component of a diversified portfolio. Instead of shying away from being wrong, investors – people in general – should expose themselves to a broader group of opinions, to alter unsuccessful behavior and improve decision making.
The findings of a new study, Misinformation and the 2010 Election, from the University of Maryland’s World Public Opinion show that 9 in 10 voters in the 2010 election believe they encountered information that was misleading or false, with 56% saying this occurred frequently. The study also concludes that those who watched Fox News almost daily were significantly more likely than those who never watched it to believe misinformation.
The bad news for FOX News viewers is that merely watching the channel appears to be toxic. Most voters believed a few whoppers during the 2010 election cycle. But daily watchers of FOX News believed more misinformation than everyone else.
The underlying problem uncovered by this study is that today’s news organization are not unbiased deliverers of the day’s events, these outlets are partisan interpreters of the day’s events packaged to appeal to their viewership or constituency. I don’t claim one network or source is a more egregious offender than another. Everyone is entitled to their opinions, but each carries a bias that should be understood before assuming what we are digesting is “news” and not opinion.
This Article is Biased
This article exposes some of my own biases. We all have them and those views can be positive as they give us the strength to make decision with confidence. Most of the stocks I own are lesser-known, yet-to-be-recognized small technology stocks. I short stocks that people recommend as buys, such as Coinstar (CSTR), and I shy away from momentum stocks with historically unjustifiable valuations. I believe you should never buy a stock for which you can’t make a historically significant case of undervaluation. In our markets his is contrary behavior, but it works, and it helps me sleep at night.
If we are making bad decisions, like buying market tops and selling bottoms like the recent bottom in 2008, it is positive to examine our biases and correct them where possible. The best way to correct faulty assumptions is to take in a variety of disparate view points and make informed decisions. We can’t do this confining our media consumption to sources that only reinforce our previously held views. Religion and patriotism should allow for independent thought and interpretation. We should all try to broaden our information sources in 2011 and perhaps we can overcome the ‘misinformation’ gap and make some more profitable investment decisions.
I hope technology positively affects your life in 2011 and all your stock investments are winners.
Steven Bulwa is an investment analyst with a focus on new developments in technology and the companies poised to benefit. He has contributed to TheStreet.com, Realmoney.com, Business Insider, Huffington Post and SeekingAlpha.com, among others. Visit www.bulwatechreport.com, or follow @BulwaTech, to learn about technology companies with true growth prospects for 2011 and beyond.
Follow us on Twitter.
Sign up for Mediaite’s daily newsletter.
robert shumake detroit
robert shumake
Foot-and-Mouth Outbreak Spreads Through South Korea - AOL <b>News</b>
South Korea is suffering its worst-ever outbreak of foot-and-mouth disease, with the highly contagious virus spreading to farms across the country despite a nationwide quarantine effort.
<b>News</b> Corp. Online Gaming Head Sean Ryan to Head Facebook's Social <b>...</b>
Sean Ryan, who arrived at News Corp. mid-year to set up a new online gaming unit, is moving to Facebook to head partnerships at its key gaming platform, according to sources. Currently, Facebook does not create social games, ...
John Roberts switches to FOX <b>News</b> | Inside TV | EW.com
John Roberts, the veteran newsman who co-hosted CNN's American Morning for three years, is joining the competition. “We are excited to welcome Jo...
robert shumake
Foot-and-Mouth Outbreak Spreads Through South Korea - AOL <b>News</b>
South Korea is suffering its worst-ever outbreak of foot-and-mouth disease, with the highly contagious virus spreading to farms across the country despite a nationwide quarantine effort.
<b>News</b> Corp. Online Gaming Head Sean Ryan to Head Facebook's Social <b>...</b>
Sean Ryan, who arrived at News Corp. mid-year to set up a new online gaming unit, is moving to Facebook to head partnerships at its key gaming platform, according to sources. Currently, Facebook does not create social games, ...
John Roberts switches to FOX <b>News</b> | Inside TV | EW.com
John Roberts, the veteran newsman who co-hosted CNN's American Morning for three years, is joining the competition. “We are excited to welcome Jo...
robert shumake detroit
From time to time all of us find ourselves unexpectedly without employment. After you apply for unemployment, try these suggestions:
Eat "take out less" and if you do, try to use coupons. The back side of grocery store receipts can often be a source of eatery discounts as well as coupons for other goods and services. Also check for coupons in phone books, newspapers and magazines. Use coupons when you shop and look for bargains. Keep an eye open for those in-store specials and the "reduced for quick sale" baskets. When you shop, look at the expiration dates. Why spend dwindling money on products that are going to go bad in a shorter amount of time? Dig in the rear of that line of milk cartons and get that further away "sell by" date! Consider where you buy certain things. The grocery store may not have as cheap of a price on paper goods as a five and dime variety of store. Many five and dime type of stores may also carry the all important snack food at a price cheaper than the main stream "name brand" grocery store. The only exception is the over-sized product box that has an undersized content weight. You must be a smart shopper and look at the content weight in the package so that you may compare it with the other brand. When you go grocery shopping, avoid puffed up foods unless you can determine the bargain in buying them. The dip chip may outweigh the puff chip in the same sized bag. Often I notice that there may be a difference in the price of groceries depending on the community and the store name that I buy the groceries at. The seedy side of town may actually be worth going to if the savings are right. Sales on foods due to a holiday can be worth checking out.
Thinking of losing some weight anyway? It's a good time to diet. Cut down on the portions and eat the left-overs during another meal. Another money saving technique is to introduce eggs back into the side dish area of the plate thus letting you fill up on a less expensive protein source. Increasing the vegetables in your diet may save you money because meats are very expensive by comparison. Dry bean purchases are always worth-while because they have a long shelf life if they are stored well. Noodle based meals can help save money. Often I find that cake mix and johnny cake mixes are some of the least expensive items in a store. Frosting may be expensive but maybe an off-brand frosting mix will bring down that cost. Ghetto napkins are made by taking your regular roll of paper towels and cutting down to inexpensive napkins. If you do eat out, then those extra napkins from the restaurant bag can be a blessing.
Purchase generic over the counter drugs and generic prescription drugs to save money.
Do you need work clothes? Be a smart shopper and check out the thrift stores first. With a little cautious shopping, you may be able to find very good looking used clothes or newly new clothes at a fraction of the normal price. Many thrift stores have reduced price days or coded tags to indicate reduced prices. You might try looking at the paper for garage sales where clothing is often sold. Some grocery stores have a bargain center where off-brand clothing might be found. Often, those areas have tools, plastic dishes, toys and other goods.
You may want apply for state assistance with your food and utilities budget. Utilities may also have payment programs or know of assistance programs that you can apply for. Another resource that may exist in your church or employer is "Angel Food" or some other kind of emergency food pantry. "Angel Food" pantries sell a grocery package for a lower than market price. Many church organizations give food to the needy or members of the church that fall down on their luck. Avoid the booze. People get depressed when they get laid off. Stay out of the taverns and liquor stores. Booze is a luxury and you will want to stay healthy and on the ball. Your next employer will more than likely want to do a pre-hire drug screen before hiring you.
Credit cards often have insurance or provisions for if their customer is injured and unable to work, or dies, or is laid off of his job. Check your information to see if you have taken out this insurance and if you have, start the paperwork right away. Remember to cancel renewing subscriptions charged to your credit card. Some business offer a free sample magazine and then if you don't call to reject service; they start charging you. Be cautious of small checks sent to you out of the blue because it may be that the sender is wanting to obligate you to do business with them. Suspend unneeded services such as satellite television and magazine subscriptions.
Making money while unemployed may be done by having a garage sale. There is no use in keeping clutter and you need the money. Often, the flea markets offer a space in their lot for either a percentile of your sales or a low fee. Yard mowing and odd jobs can be a good payday for the unemployed- just be sure that you have an agreement on the price with buyer of your services. No one wants to work like a dog on a project just to have a little old lady reward you with cookies and milk. Plasma centers may pay for donations. E-bay may make you money, but you don't really know how an auction will go when you auction an item and you have to consider the listing fee and the fee for shipping your sold item to the buyer. Work-by-day employers often pay out a check daily to temporary laborers.
Employment services often get their employees short term work assignments that pay weekly. If you are young and going to college and providing that you are near a sperm bank, you might try selling your sperm. Wow, what a deal! Dumpster diving can be a source of income. Often one can use what is thrown out as product to sell. These guys love "big junk day". A bottle of wood glue, some thrown out wooden tables and chairs.. you get the picture. Be a collector of lost coins.
Many grocery stores now have machines that count, sort and issue a pay ticket for your coins and if you pinch pennies you can get groceries or paper money. If you are willing to do it, you can collect discarded drink cans to save up a large weight of cans. The cans, being aluminum, can be taken to an automatic collector machine and thrown in where they are crushed and weighed. The collector machine then drops payment to you. The bottom line here is to keep your mind open enough to come up with a legal way to turn a buck.
Gifting for birthdays, holidays and other occasions can be a nightmare for the unemployed. This is where you have to really be discreet and pay attention to detail. Try to find things that you can make into an acceptable gift. Pawn shops may have items that work very well and cost less than new. I have seen shirts in thrift stores that have the mall tag still attached to them. They were donated before they had any great amount of usage- taken to a dry cleaner, put in a generic white shirt box and a gift is born! Costumes can be created from many items found on a thrift store shelf. Five and dime stores can be an inexpensive source of toys. Consider using gifts that you don't wish to keep as a present for someone else. Try gifting homemade items such as food baskets or artwork. Books can make nice gifts. I often see books sold cheaply at thrift stores. Be sure to really look it over for wear and markings. Sometimes you can remove markings. When you remove markings consider what the writing was created by and what kind of material you are removing the marking from. Crayon and grease pencil on hard plastic may come off with a rag and cigarette ashes- just be careful of textured or porous plastics which can tend to hold the stain. Read the labels of remedies such as wd-40 oil before attempting to clean with them.
To keep up appearances try keeping some empty brand name boxes in your shelves. You can substitute off-brand foods to name brand containers. Use generic containers and cookie jars to store snacks. If you don't see an off-brand label then you have to really compare to notice the difference. Seal up your garbage well. Shred thrown away bills. Be yourself and keep a routine of getting up and getting dressed. People see large changes in behavior. Hopefully your rough time is short lived.
robert shumake detroit
Foot-and-Mouth Outbreak Spreads Through South Korea - AOL <b>News</b>
South Korea is suffering its worst-ever outbreak of foot-and-mouth disease, with the highly contagious virus spreading to farms across the country despite a nationwide quarantine effort.
<b>News</b> Corp. Online Gaming Head Sean Ryan to Head Facebook's Social <b>...</b>
Sean Ryan, who arrived at News Corp. mid-year to set up a new online gaming unit, is moving to Facebook to head partnerships at its key gaming platform, according to sources. Currently, Facebook does not create social games, ...
John Roberts switches to FOX <b>News</b> | Inside TV | EW.com
John Roberts, the veteran newsman who co-hosted CNN's American Morning for three years, is joining the competition. “We are excited to welcome Jo...
robert shumake detroit
robert shumake detroit
No summary of 2010, visual or otherwise, would be complete without an extensive overview of what pundits call Monetary Stimulus, quantitative easing or Large Scale Asset Purchases, and the peasantry calls, just as correctly (with a few footnotes), the printing of money. If there are two words that define what we had an absence and an abundance of in the past year, those would be jobs, and money. As some of the key jobs-related charts were presented yesterday, below, once again courtesy of BusinessWeek, are the main charts that among other things demonstrate the various currency manipulation playbooks, the price of gas in bacon and other products, the annotated strength of the dollar through time, and what is actually printed when the Fed does print money.
The first chart shows the progression of dollar strength (and weakness) with an annotation for contemporaneous global events. What is ironic is that while everyone realizes the world is still in a very week position, the core debate over who is weaker - Europe or the US, is sure to provide many hours of entertainment in 2011. And as a bonus, the man whose policies, together with those of Bernanke, are instrumental in just how weak the dollar gets, is presented in his key natural states: from lying just every so slightly, to lying a lot, to lying profusely to save his life, to lying at such a rate, it would make those whose pants are burning, blush with envy. And now you will know how to distinguish the four...
The next chart deals with the actual money printing, but not in an deeply philosophical manner, one in which hours of debate are wasted over whether trillions in excess reserves are actually printed money (even though the last time someone acquired USTs, MBS, and soon Munis and ETFs, with pixie dust, the legal consequences were not all that palatable). Of the just over $300 billion in actual currency printed in 2010, the vast majority was in $100 bills, next up was $20s, followed by $5s, $10s, and lastly, singles. Not a single $50 bill was printed. Also noted: the amount of cash in corporate America. Of particular interest: GM has more than half of its market value, or $27.5 billion sitting in cash. Lastly, and this not come as a surprise to many, the money multiplier: the money supply divided by the monetary base, is at near record lows, courtesy of the $1 trillion in excess reserves.
Another popular meme in 2010 was pricing X in Y, most often the stock market in gold, in which basis it is still down for the year, as gold (not to mention silver), despite the short memory of many, is by and far the best performing asset class of 2010. Those who followed our advice in early 2010 to avoid stocks and to invest in gold, are ahead of most. The chart below takes a comic approach to this relative performance, showing how much the price of gas changed when priced in other "currencies."
Last, and probably most interesting, is the graphic presentation of the currency manipulator playbook: in a world in which Ben Bernanke knows very well he has little competition when it comes to doing as he chooses with the world's reserve currency (for now), other sovereigns are forced to come up with their unique responses. The playbook below shows all the various defensive tactics adopted so far. Luckily, few offensive plays have been established to date. We doubt that will be the status quo for a long time.
And as John Taylor and many others have pointed out, now that the fiscal "stimulus" of the payroll tax has been exhausted in a few short weeks courtesy of the jump in crude oil, and any further fiscal intervention not likely to occur unless Congress wants another incumbent bloodbath next time around, as Americans are tired of subsidizing banker lifestyles, expect to see many additions to the FX manipulation playbook, as the year progresses and monetary intervention continues to be the only direct way of making sure every new banker bonus year is a record one is via the Fed and its ongoing dollar printing-cum-debasement. That said, should the bankrupt European house of cards continue to wave a white flag of surrender every 3 months, the race to the bottom may not have a clear winner well after 2011 is also history.
All charts courtesy of BusinessWeek
Everyone likes to be right and the easiest way to be right is to surround oneself with people and opinions that are predisposed to be similar to ours. When investing, it pays to be contrary. That sets you up to be wrong some of the time. The thing is, if you are right 60% of the time, and manage risk properly, there is a good chance you’ll make money. The most basic principle of investing is buy low and sell high. When doing this you’ll seldom hit the actual bottoms or tops; you are buying when the market is going down and selling when it is going up. That in itself is contrary to most retail investors’ practice of buying high and selling low.
Mutual Fund Flows and Sentiment as Contrarian Indicators
The majority of retail (casual) investors use mutual funds and ETFs (Exchange Traded Funds) to invest in the markets. Fund flows (deposits vs. withdrawals) are generally regarded as contrary indicators. This is a component of a broader series of indicators classified as investor sentiment that provide some insight into future directions of the market. The basic principle is: when many investors are bullish the market is more likely to go down and conversely a higher level of bearishness or negative sentiment indicates the market is likely to make a move higher. TrimTabs Investment Research reports on these fund flows and in a recent report stated:
We observed that equity prices tend to fall after equity exchange-traded funds (ETFs) rake in large sums of money. Conversely, the market tends to rise after equity ETFs post heavy outflows.
The report then issues this conclusion:
We have two explanations for the strongly negative correlation between equity ETF flows and future market returns. First, ETFs are traded mostly by retail investors and day traders. These are the least informed and most emotional market participants—the ones most likely to lose money over time. Second, we suspect hedge funds use ETFs when liquidity dries up. Hedge funds were forced to close individual stock positions during the credit crisis, so they bought equity ETFs instead. Equity ETFs posted large outflows in 2009, when liquidity improved.
These concepts are not really as complicated as they seem to be. It’s Economics 101. When demand outstrips supply, prices go up and when supply is larger than demand, prices go down. When funds are flowing into stocks, markets rise but at some point most people are invested and there isn’t enough uninvested capital left to drive prices higher.
Whatever the internal dynamics, the retail investors are generally the last to join in a rally and their main vehicle of investment are mutual funds and ETFs so large inflows into those instruments suggests that the market is near the top. That’s why many retail investors get the timing wrong and end up losing money. Nobody likes being wrong or losing money, it makes us feel pretty lousy about ourselves! This is borne out in the current rally where the retail investor is reticent to return to the markets after being burned so badly in the housing/banking crisis of 2008 – maybe one time too many in the last decade. As Adam Shell recently wrote in USA Today:
Yet, increasingly, investors on Main Street are not playing the stock market game with confidence like they used to, mainly because the game of making money has gotten tougher and more volatile since the financial crisis. Retail investors are buying fewer stocks. They are paring back on stocks and stock funds they already own. Instead, they’re moving into safer investments, like cash and bonds. “Investors are on strike,” says Axel Merk, president and chief investment officer at Merk Mutual Funds.
Fox News Doesn’t Make You Dumb. It Just Keeps You that Way
I don’t think the decision by retail investors to stay away from the markets is a good one. Markets have historically been a better investment than many other asset classes with the S&P 500 returning roughly a 7% annual rate of return. Stocks should, at the very least, be a strong component of a diversified portfolio. Instead of shying away from being wrong, investors – people in general – should expose themselves to a broader group of opinions, to alter unsuccessful behavior and improve decision making.
The findings of a new study, Misinformation and the 2010 Election, from the University of Maryland’s World Public Opinion show that 9 in 10 voters in the 2010 election believe they encountered information that was misleading or false, with 56% saying this occurred frequently. The study also concludes that those who watched Fox News almost daily were significantly more likely than those who never watched it to believe misinformation.
The bad news for FOX News viewers is that merely watching the channel appears to be toxic. Most voters believed a few whoppers during the 2010 election cycle. But daily watchers of FOX News believed more misinformation than everyone else.
The underlying problem uncovered by this study is that today’s news organization are not unbiased deliverers of the day’s events, these outlets are partisan interpreters of the day’s events packaged to appeal to their viewership or constituency. I don’t claim one network or source is a more egregious offender than another. Everyone is entitled to their opinions, but each carries a bias that should be understood before assuming what we are digesting is “news” and not opinion.
This Article is Biased
This article exposes some of my own biases. We all have them and those views can be positive as they give us the strength to make decision with confidence. Most of the stocks I own are lesser-known, yet-to-be-recognized small technology stocks. I short stocks that people recommend as buys, such as Coinstar (CSTR), and I shy away from momentum stocks with historically unjustifiable valuations. I believe you should never buy a stock for which you can’t make a historically significant case of undervaluation. In our markets his is contrary behavior, but it works, and it helps me sleep at night.
If we are making bad decisions, like buying market tops and selling bottoms like the recent bottom in 2008, it is positive to examine our biases and correct them where possible. The best way to correct faulty assumptions is to take in a variety of disparate view points and make informed decisions. We can’t do this confining our media consumption to sources that only reinforce our previously held views. Religion and patriotism should allow for independent thought and interpretation. We should all try to broaden our information sources in 2011 and perhaps we can overcome the ‘misinformation’ gap and make some more profitable investment decisions.
I hope technology positively affects your life in 2011 and all your stock investments are winners.
Steven Bulwa is an investment analyst with a focus on new developments in technology and the companies poised to benefit. He has contributed to TheStreet.com, Realmoney.com, Business Insider, Huffington Post and SeekingAlpha.com, among others. Visit www.bulwatechreport.com, or follow @BulwaTech, to learn about technology companies with true growth prospects for 2011 and beyond.
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