|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.”
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.
|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,