Speculative Bubble Stocks Blog

The Shanghai Composite Index seems to be bouncing back

Tue, 27 Feb 2007 00:00:00 +0000

Well the Shanghai Composite came back up about 4% so far...

http://finance.yahoo.com/q?s=%5ESSEC&d=b

Look at the last six months - it doubled:

5 year:

E-Trade global stock trading $20

Tue, 20 Feb 2007 00:00:00 +0000

E-Trade is going to let customers buy and sell stocks traded on global exchanges for $20- pilot project - Canada, France, Germany, Hong Kong, Japan and Britain. The rollout is expected to take two months before all customers have access, and could one day expand to 42 international markets. Stock exchanges in Asia have bounced to unprecedented highs and far outpaced Western markets

"Nobody can deny the world is becoming more interconnected, a more global community," said President and Chief Operating Officer Jarrett Lilien in an interview. "I think our competition is going to have to follow. This is going to be a fundamental part of investing."

Previously, retail investors who wanted to buy foreign stocks that were not listed on U.S. exchanges as American Depository Receipts had to call brokers and accept commission fees that topped $100. E-Trade will charge a $20 commission, and also give customers the ability to move U.S. dollar accounts into foreign currencies.

The launch unlocks thousands of stocks previously unavailable to online traders, and pressures top rivals Charles Schwab Corp. and TD Ameritrade Holding Corp. to make similar moves.

Until now, most average investors were pretty much restricted to owning mutual funds or electronically traded funds -- commonly known as ETFs -- with stocks from a particular market. Most retail investors have shied away from owning foreign stocks because there isn't as much research available to them, while funds tend to spread the risk.

Customers will also be able to buy and sell euros, pounds, yen, Canadian and Hong Kong dollars.

Full article at montgomeryadvertiser.com

There's a growing consensus on Wall Street that investors should diversify overseas, appropriating 25 percent of their portfolio to foreign investments. More and more Americans are sinking cash into mutual funds outside the U.S., where last year saw broad advances.

Old Stock Market Glossary

Sat, 10 Feb 2007 00:00:00 +0000

Let me know if you notice a term that is too outdated - or have one for me to add to it. Actually, maybe I'll go put a comment form on each word. Back in the day each term had a comment box and the terms were more like topic starters and were loaded with great comments. Of course that got taken over with spammers and I eventually ended up losing all the comments in a webhosting switch issue a few years ago. That won't happen again so feel free to comment. I hope to have a comment box up tonight.

Here is the glossary

UPDATE - comment form now added

I'll be adding lots and lots of new terms to it over the next year

Google - Real-time stock quotes for free

Fri, 12 Jan 2007 00:00:00 +0000

Not yet but they're working on it.

Today, the NYSE has moved the issue a great step forward with a proposal to the SEC which if approved, would allow you to see real-time, last-sale prices across all Google properties including Google Finance, Personalized Google, Mobile, and of course, Google.com.

What's really important is getting free, easy and fast access to real-time quotes so you know how the market or your company is doing now, not as of twenty minutes ago.

As a result, we've worked with the SEC, the New York Stock Exchange (NYSE) and our D.C. trade association, NetCoalition, to find a way to bring stock data to Google users in a way that benefits users and is practical for all parties. We have encouraged the SEC to ensure that this data can be made available to our users at fair and reasonable rates, and applaud their recent efforts to review this issue.

You'll have free, easy and fast access to real-time prices from NYSE on Google.

Full article at googleblog.blogspot.com

Morningstar Investing Classroom

Sun, 07 Jan 2007 00:00:00 +0000

morningstar.com/Cover/Classroom.html

If you want, skip the free registration and just read the articles without logging in

Forcast some surprises for 2007

Thu, 04 Jan 2007 00:00:00 +0000

Not one year in the past 1,000 has elapsed without surprises for investors, here are 4 unexpected events that will occur in 2007

Another Bull market, year 5 historians will tell you that the current bull market, which began in October 2002, is now one of the longest in history. That leads bears, who have shorted the market at a record pace, to guess it is bound to fall apart in its fifth year. However, you need to realize that the current bull has been the weakest in history. A slow, steady gain is not a bad thing; you can go farther walking than running

The Federal Reserve will be able to quash inflation by braking the U.S. economy without running it into a wall the Fed will lower interest rates by half a percentage point, and U.S. economic growth will slow to a tepid but reasonable 2.6%. That level of growth is well below the 4% pace considered robust, but it's not an industry-annihilating, worker-devastating, consumer-abusing knockdown

Large-cap growth stocks could lead the market in 2007 When the economy slows, companies whose fortunes are largely tied to gross domestic product growth find themselves in hot water. Seasoned growth companies, ones that year after year innovate their way to above-average earnings gains are prized

Media companies to stage a brilliant comeback in 2007 The motion picture and television industry surpassed the defense industry as the top moneymaker in Los Angeles a few years back; pop culture is one export that is helping to stave off disaster in our trade deficit; and newspapers have finally figured out how to compete online

Full article at articles.moneycentral.msn.com

Investors looking forward to 2007

Thu, 04 Jan 2007 00:00:00 +0000

Recent studies on consumer confidence reveal that many Americans have shown a renewed interest in the capital markets once again. The strength and recent stability of the Dow Jones Industrial Average has fueled this renewed interest in keeping investable assets liquid while maintaining the need for growth net of taxes and inflation

In recent years, investors have been able to celebrate positive returns as the capital markets have been working out of one of the greatest market collapses of all time in the year 2000 where many investors saw their life savings nearly cut in half.

The recent years of recovery have been good not only for portfolio values, but perhaps more importantly, investor confidence has been given new life as we enter 2007

Today, on the heels of the most unprecedented boom that we will likely ever see again in Real Estate, there are still many investors who will enjoy re-investing their proceeds from the success they had during the brief, unsustainable and artificially inflated residential Real Estate bubble

There were many homeowners with a relatively low cost basis who were fortunate to be the first to sell when they saw the "overnight" run up in prices. These were the winners in all of this

Of course, the flip side to this scenario is for all of those unfortunate speculators who jumped in and were happy to be the third or fourth buyers of a property in six months.

Aside from the speculators "bleeding money" to maintain their "investment properties," there are still many who cashed out and have liquid, investable assets.

With new levels of liquidity flowing into the markets, we may just begin to get a glimpse of what lies ahead for 2007

Ben Bernanke has shown cautious optimism with regards to the direction of interest rates. slowing of rate increases combined with additional liquidity flowing into the market could be very positive news

This confluence of new liquidity flowing into the market, combined with a new level of comfort on the part of the Fed and "Bernanke's Boys," could create a very positive market condition, at the very least during the short-term.

Full article at zwire.com

Underlying fundamentals really seem to be leaning towards investor's favor as we ease into 2007

Major Market Events in 2006

Sat, 30 Dec 2006 00:00:00 +0000

fueled by low interest rates, mergers and solid corporate profits, Wall Street finally returned to a record-setting performance in 2006 after seven years

As long as gasoline prices don't rise, housing prices don't drastically fall, inflation stays in check, the economy continues to grow slowly, and the Federal Reserve starts cutting interest rates; most analysts predict that the market will finish much higher in 2007, although they expect that the next few months may be choppy.

Dow closed the year at 12,463.15, 16.6 percent above where it began

Standard & Poor's 500 Index closed at 1,418.30 for a 13.6 percent annual gain

Nasdaq Composite Index closed at 2,415.29 for a 9.5 percent rise

The single most important event behind the stock market's rise in 2006 was that the Federal Reserve stopped raising interest rates

A record $3.5 trillion in mergers also churned the market in 2006

Corporations such as Exxon Mobil produced record-breaking profits

Softness in the housing market encouraged speculators to shift their money from real estate to Wall Street

Oil prices, which approached $80 a barrel during the summer, moderated to $61.05 yesterday, helping cool investors' fears of inflation

Full article at signonsandiego.com

Many of the world's major stock markets out-performed Wall Street this year, especially after taking into account the declining value of the dollar, which chipped away the value of U.S. stocks to foreign investors

After taking into account the declining value of the dollar, the leading stock index in London rose 26 percent; Paris, 31 percent; Hong Kong, 33 percent; Frankfurt, 36 percent; Stockholm, 39 percent; Sao Paolo, 45 percent; Mexico City, 46 percent; and Spain, 48 percent

New Funds: Too Much of a Good Thing?

Wed, 20 Dec 2006 00:00:00 +0000

In 2006, more funds went public (offered stock to individual investors for the first time) than actual companies that sell things

Mutual funds are investment companies: An investment advisor manages pools of money, following whatever strategy is described in the fund's prospectus. Index funds are passively managed baskets, synced up to an index the fund tries to mimic. The fund promoters make money on management fees to run the fund.

Today the buzz is all about exchange traded funds (ETF). ETFs have the excitement and tradability of stocks, with the sensibility of diversified mutual funds - only cheaper. Or that's the pitch anyway.

ETFs are often based on indexes, though these days, the indexes are really just formula-driven lists of stocks created by the fund company - like "highest dividend stocks in the S&P500, equally weighted" or "healthcare stocks, ranked by market cap.

Investment company stocks - stocks of the advisor's behind the mutual funds - have been among the stock market's best performers in recent years. And why not, they collectively manage over $10 trillion

There are two big problems with the new funds glut:

1) Investors tend to get into trouble with more targeted and risky investment choices. The more concentrated your investment, the greater your downside.

2) What is saleable is rarely a good idea. Investor optimism is like fertilizer for funds. The greatest boom in fund launches occurred before the crash of 1929, the Nifty Fifty wipeout and ensuing 1970s market decay. Far more funds launched in the 12 months before the 1987 crash than the 12 months after - and those launched post-crash tended to be safer bond funds. The late 1990s were among the biggest boom times for fund launches

Full article at foxnews.com

"As an investor, you'd have to look pretty hard to find something fundamentally wrong today. The economy is strong, employment is great, inflation is under control, interest rates are low, corporate profits are at record levels, per capita wealth is at all time highs, home prices remain elevated, the most invested in stock index and the S&P 500 is still below record levels.

The number of new funds is probably the most frightening feature of this new "permanently high plateau" in the economy and stock market. There simply can't be this many good ideas."