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EC US Consumer Is The Last Defense Against Strong Dollar Drag On The Economy
We continue to receive questions about the impact of the recent dollar strengthening on the US economy. The most immediate impact of course is on trade, which has created an immediate drag on the GDP growth. Source: St Louis Fed, Goldman Sachs We know that the impact on US industrial production in particular has been terrible. On the other hand this currency appreciation, combined with weaker energy prices, is supposed to improve consumption as imports become cheaper. The chart shows US import price index And of course all the cheap fuel (combined with a warmer winter) should be providing material support to US households. US aver... -
Finance 0
Could Low Oil Prices Cause Toyota Hybrids To Fade?
It should be clear by now that EVs are winning against conventional hybrids in their respective initial years of adoption. As we can see in an updated version of a table I published in 2014, in their initial 97 months of introduction, 774,790 hybrids were sold, whereas in only 57 months of adoption, 898,993 plug-ins were retailed (See Table 1). In essence, what this means is that plug-ins are in fact being adopted at a much faster pace than conventional hybrids. Still, in July 2015, Toyota (NYSE:TM) announced it had crossed the 8 million hybrid mark while plug-ins would have recently reached the one-million global plug-in sales milestone only... -
Finance 0
Could Low Oil Prices Cause Toyota Hybrids To Fade?
It should be clear by now that EVs are winning against conventional hybrids in their respective initial years of adoption. As we can see in an updated version of a table I published in 2014, in their initial 97 months of introduction, 774,790 hybrids were sold, whereas in only 57 months of adoption, 898,993 plug-ins were retailed (See Table 1). In essence, what this means is that plug-ins are in fact being adopted at a much faster pace than conventional hybrids. Still, in July 2015, Toyota (NYSE:TM) announced it had crossed the 8 million hybrid mark while plug-ins would have recently reached the one-million global plug-in sales milestone only... -
Finance 0
Switzerland Asks Malaysia To Explain $4 Billion In Misused Money From Goldman Backed Slush Fund
Earlier this week, Malaysia’s top prosecutor Attorney General Mohamed Apandi Ali cleared PM Najib Razak of any wrongdoing in connection with some $681 million that landed in his bank account back in 2013. The money was “a personal donation” from the Saudis, the investigation found and no further information was necessary. That, we said, was unlikely to satisfy critics. Critics like former PM Mahathir Mohamad, the “founding father” of modern Malaysia who has a series of questions about the alleged “donation” including the following: “It seems there was a letter by a Saudi stating that a sum of US$681 million or RM2.08 bil... -
Finance 0
5 Undervalued Companies For Value Investors With A High Beta – January 2016
There are a number of great companies in the market today. By using the ModernGraham Valuation Model, I’ve selected the five undervalued companies for value investors reviewed by ModernGraham with the highest beta. A company’s beta indicates the correlation at which its price moves in relation to the market. A beta greater than 1 indicates a company is more volatile than the market. Each company has been determined to be suitable for either the Defensive Investor or the Enterprising Investor according to the ModernGraham approach. Defensive Investors are defined as investors who are not able or willing to do substantial research into ... -
Finance 0
It’s Now Or Never For Bulls
Was Friday’s world-market rally serious and sustainable, or simply a knee-jerk reaction to Japan’s surprise NIRP (negative interest rate policy) announcement (including some shorter-term short-covering action) and “end-of-month window dressing” by fund managers? Perhaps the following update to my last post will provide some further insight into that question, as I review a variety of markets. YM, ES, NQ, TF and NKD E-Mini Futures Indices: The following Daily Heikin Ashi candle chartgrid of these E-mini futures indices shows a potential bullish reversal pattern as of today’s close. We’ll need to see a ... -
Finance 0
Do You Know When To Sell?
That rearview mirror really is 20/20. It’s the land of woulda, coulda, shoulda. Too often we look at stocks we didn’t buy for whatever reason and get angry. But the real fault lies in not selling at the correct time. As Kenny Rogers says: “You gotta know when to hold ’em. Know when to fold ’em.” We talk so much about when to buy and so little about when to sell. This overlooked side of the equation is just as responsible for your investment performance as the buy side, if not more. Today I am going to share with you the four rules to selling at the right time so you’ll know when to take a profit and w... -
Finance 0
Gold Daily And Silver Weekly Charts – BoJ Shocks, Silver Inventory Drops
Gold and silver were stronger than expected on Friday as the US dollar was soaring on the shocker that the Bank of Japan is going negative on yen interest rates. This set the markets back on their heels because just a week ago BoJ’s Kuroda publicly dismissed the possibility. This is a possible artifact of the currency war, in which certain countries will be seeking to devalue their currencies through various mechanisms in the hope of stimulating their economies, among other things. On that announcement the US dollar index lit its afterburners and rallied harder. I am wondering if these currency interventions, because this is exactly wha... -
Finance 0
EC How To Analyze A Cyclical Company
“I think it’s essential to remember that just about everything is cyclical. There’s little I’m certain of, but these things are true: Cycles always prevail eventually. Nothing goes in one direction forever. Trees don’t grow to the sky. Few things go to zero. And there’s little that’s as dangerous for investor health as insistence on extrapolating today’s events into the future” – Howard Marks, The Most Important Thing Analyzing a cyclical company presents a special set of challenges for the equity analyst. The market generally underestimates the role of the cycle, and this can result in wild swings in shares of cycli... -
Finance 0
Welcome To The Currency War, Part 21: Japan Goes Negative; US To Return Fire In 2016
Well that didn’t take long. Two weeks of falling share prices and the European and Japanese central banks go into full panic mode. The ECB promised new stimulus — which the markets liked — and then BoJ upped the ante with negative interest rates — which the markets loved. Here’s a quick summary from Bloomberg: Central Banks Intensify Campaign for Negative Rates In surprising markets by penalizing a portion of banks’ reserves, the Bank of Japan on Friday joined a growing club taking the once-anathema step of pushing some borrowing costs beneath zero. “Negative rates are now very much the new normal,” said Gabriel Stein, an econ...
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