Dear rss free blog,
Stock
trading is screwed up today because of technical problems in the
consolidation process at the NYSE. It may be linked to a surprise
dump of snow which hit New York this morning. Or not.
I
have no link with Zacks Investment Research Inc., a rigorously
independent analysis shop. The momentum investing service in Chicago
runs zacks.com which looks for investment surprises. Yesterday Zacks
pounded the table that investors should buy one of our longest-time
favorite ADR stocks which I am counting on to finance my years on
golden pond.
And
it also strongly supported buying Sandisk, a US company, for
momentum, despite (or because of) the stock making new highs. I own
healthy amounts of SNDK even though it is not an ADR.
I
would not buy SNDK at current price levels ($29.94 after Zacks came
out), not being a momentum player. According to Bloomberg,
the average target for the stock is $26.50 (based on at least 4
analysts’ coverage.)
I
promised to stop telling people to invest in GE as
I did all last year to groans of boredom or squeals of profit
depending on whether or not you listened to me. But as a U.S.-based
dollar spender, I put most of my money into standard issue American
shares, not foreign ones.
Or
even Canadians like my new recommendation for paid shareholders
yesterday.
From
Phuket, reporter and stock picker Paul Renaud writes a few insults
about the other Swiss investment guru who also operates out of
Thailand, which I will not reproduce because I do not want to face a
lawsuit from Marc Faber which might bankrupt this business. Paul
asks: “Where
is the ‘renewed inflation’ we keep hearing about? For many
years pundits have been saying inflation is on the horizon. Beware.
Yet that coming inflationary horror keeps being pushed back on the
horizon.
“Today
interest rates remain at all-time lows all around the world. Based on
past periods of low rates, inflation is clearly not (yet) back. So
the successful investor mantra continues the same as it has been
since the turn of this century: favor investment with high current
income.
“An
example would be high dividend yields on un-leveraged Asian growth
stocks, especially those not vulnerable or dependent on Western
economies. Ten years ago, inflation did not return because IT
productivity enhancements finally showed up in the numbers. Then, 5
years ago it did not come back thanks to the ‘China price effect’,
which
had a huge macro impact in taming global inflation.
“Lately
it cannot be found the US induced global financial crisis stopped
inflation. And yet, inflation believers keep warning us that
inflation
is lurking around the corner because of the massive liquidity Western
central banks have pumped into the system lately. Maybe but perhaps
not?
“Billions
have been lost in this latest crisis -and so the US consumer it now
tapped out, and likely will remain so for some time. Since the US
consumer remains dominant accounting for over 65% of the world’s
consumption, retrenchment in the US will keep global inflation at
bay.
“Perhaps
this is why the global oil price is stuck below $70-90 a barrel and
gold, with its zero current income, is barely keeping up as an
average investment.
“Add
to that, the reality that Asia (especially China) will not quickly
turn from a nation of savers to one of consumers for many good
reasons.
“Therefore
global growth will likely remain lackluster, with inflation
contained. So, high dividend yielding growth stocks will keep
outperforming other assets.
“Thailand
has a number of such growth stocks, with zero
debt, not dependent on local politics nor the US consumer. What is
unique about these Thai growth stocks, speaking as one who spends
enormous effort in selecting them, is that they also pay a high
current dividend, many times over the interest paid to savers at Thai
Banks.
“If
the global and Thai economies spring
back to life, these growth companies will become even more
profitable. If on the other hand, the economies remain subdued (as I
think) interest rates will remain low for some time – and yet these
firms’ paid cash dividends will remain high. Either way they are a
good place to invest some of your capital.”
Paul goes on to tell our paid
subscribers about his favorite Bangkok small cap pick. You can read
his ideas on his www.thaistocks.com
website.
This is a hard stock to buy
because you have to buy it in Thailand. If you cannot buy for about
$5000-10000 you should not even begin unless you have an Asia
brokerage account. I pay $70 in commission to trade in Bangkok
through my bank, the US sub of HSBC.
But if you want to follow
Paul’s trail to profits, subscribe to our stock service and you will
be able to read more. We also have news of our companies in Israel, Canada, Britain, France, Brazil, India, Mali, and Switzerland. Mali, as you can learn from our advertiser below, is in West Africa.
