Login

Tax Smart Investing for Professionals & Business Owners over 50

Learn how to legally reduce corporate tax, save 50% more for retirement, cut tax on business sale, & reduce portfolio risk.

Click here to access
- FREE WEBINAR -

Asset protection

Minimizing Risk in Volatile Markets

Share on Facebook Tweet on Twitter

Posted by Dan Dicker - OilPrice.com

on Friday, 06 April 2018 13:35

After rallying last Friday, the Dow tanked over 450 points this Monday, rallied more than 1,000 points Tues/Wed/Thurs then tanked another 572 points today. That's volatility and this analyst has some advice on how to survive in this violent action - R. Zurrer for Money Talks

 

Have you been experiencing a sickening feeling? The kind you get when a plane hits some unexpected turbulence, or when the roller coaster you’re on takes that high drop?

That’s volatility.

Some people like that feeling – if they’ve chosen to be on a roller coaster. Of course, they’ll come out just fine on the other end of the ride with big smiles on their faces. They might even run to get back on line for another trip.

But if you’re investing in the market, volatility is nothing to enjoy. And definitely not something to wish for.

sc

This column is less an energy update than something far broader in scope. But I can’t ignore the bigger picture surrounding oil and oil stocks and still have any chance of getting the smaller picture right, and volatility is currently swamping out everything else in the energy markets. 

Volatility isn’t a disease, it’s a symptom. It’s a symptom with a number of possible diagnoses, like a chronic cough is for a person. You might have a cold – or it could be something much worse. But one thing for sure, a chronic cough is not something to wish for, nor is it something you’d be smart to ignore. 

Since the market highs in late February, we’ve had a very violent correction from some understandable sources: The big and long-awaited corporate tax cut was passed. A changeover in the Fed chairman signaled a slow but steady rise in interest rates. The dollar began to gain strength from its lows. 

But we’ve also seen some added pressures that have been unexpected: A retreat from global trade agreements in Asia and North America. An unending turnover in White House staff. Saber-rattling in North Korea and Iran. A 1950’s-style energy advocacy towards coal. And, most recently, an unprovoked threat of a full-on trade war with China. 

My job isn’t to measure the politics of these pressures – although most of them seem entirely unnecessary – it is to measure how they are likely to impact our investments in oil and gas stocks. 

Volatility is a sign of insecurity – and it’s almost always a negative sign. So, whether the markets happen to be up today, you shouldn’t feel all that much better about your oil and gas investments – not while we’re in the midst of such turmoil.  

So, how do we handle this roller coaster ride? Well, in two ways – by limiting our exposure to higher-beta stocks and increasing it towards more blue chip dividend producing shares. In the end, we want to be increasing our cash position as well. 

This has been my mantra for the past several columns and, if anything, gains even more volume after the action of the previous week. Despite the very strong fundamentals that I see in high-beta, Permian focused shale players, now is not the time to be adding to positions – in fact, most rallies in these shares should be seen as opportunities to lighten up on them. They SHOULD NOT BE ABANDONED – only shaved. Concurrently, downdrafts in the market should be used to add to positions of a few key dividend-safe majors. I have particularly favored the Euro-majors like Total (TOT) and Shell (RDS.A) for the better part of a year, and they have performed far better than their U.S. counterparts. 

In this way we will be minimizing the effects that this new trend of huge volatility has been having, and likely will continue to have on our oil and gas stocks.

And maybe come out smiling on the other end of this roller coaster ride.

By Dan Dicker Oilprice.com



Banner

Asset protection

Gold is not Saying Something – Its Screaming It

Share on Facebook Tweet on Twitter

Posted by Przemyslaw Radomski

on Friday, 06 April 2018 06:41

Bottom line, Golds inability to break the $1360/70 barrier for nearly two years including multiple attempts recently, yesterday's action indicates we sit on the precipice of a sizeable downswing - R. Zurrer for Money Talks

Gold soared yesterday, likely based on the escalation of the trade conflict between the U.S. and China, but after several hours the rally was over. The tensions didn’t really subside, but the price of gold is already about $10 below the price at which it was trading when yesterday’s rally had started. Is gold trying to say something? No. It’s not saying – it’s screaming.

There is a combination of two factors that makes the current situation particularly interesting and meaningful. The first factor is what we already discussed in the previous alerts – gold’s decline was delayed because new bullish fundamental news kept emerging. We wrote that eventually there would be no new bullish news and that the price of gold would move back to its default mode and resume its decline.

The second factor is that if a given market no longer reacts to factors that should trigger a specific kind of reaction, then it’s a clear sign that the market is about to move in the opposite direction. Yesterday’s session in gold showed exactly that – gold should have rallied, and it did – but only initially. There was not enough buying power to keep pushing gold higher. In fact, buyers were not even able to prevent gold’s decline in the final part of yesterday’s session. Today’s pre-market downswing (gold is at about $1,325 at the moment of writing these words) confirms that the buying power (at least temporarily) almost dried up.

Combining the two previous paragraphs gives us a picture in which gold is not only unwilling to rally substantially based on positive news – it’s not even likely to rally temporarily based on them. It means that both: gold’s next move is likely to be a sizable downswing and that the time for the consolidation is up or almost up.

Before we move to charts, we would like to explain how the market tends to react if it really wants to move in one way (here: decline), but the fundamentals keep interrupting it (here: bullish fundamental gold news - news that’s bullish from the fundamental point of view). We’ll not going to explain a sophisticated econometric model for this and we’ll not going to use terms as first derivative or diminishing marginal returns. Instead, we’ll use a simple analogy to something from real life. It will not be a pleasant analogy, but if it generates any emotions, then it’s more likely that it will be easier to keep in mind.

Think of a hardcore drug addict. They have to keep on getting more and more of their “stuff” to keep them happy. They have to constantly increase the amounts of drugs that they take to get the same effect. Even though the final effect is the same – they get their “enjoyment” - the cause is only the increase in dosage. If they didn’t increase it, they would get smaller effects up to the point when it would not be noticeable. If they stop taking the drug at all (eventually, they are likely to run out of it, or their health is too damaged), their “enjoyment” turns into a nightmare.

Similarly, the price needs more and more bullish news to keep on rallying and at some point, the same amount of news (or the same importance of them) will start to generate smaller and smaller rallies. It would take more dramatic and more bullish pieces of news to trigger the same upswings. If the bullish news dosage stays the same, the price will rally at a slower pace and finally stop to rally at all. Once the bullish news is gone (or we have bearish news), the rally turns into a decline.

Yesterday’s session in gold likely shows the final stages of the above cycle and the implications are very bearish.

Having said that, let’s take a look at the charts starting with gold (chart courtesy of http://stockcharts.com).

Gold’s Daily Reversal

(click all charts below for larger images)

1

Technically speaking, gold reversed on significant volume, which is a classic sell signal. The implications are even greater than based on just the above, because we also have supporting analogies. Namely, this is the kind of reversal that we saw quite a few times before big slides, but after tops in terms of daily closing prices. We marked those cases with red arrows.

The most prominent example is early November 2016 and we can see the remaining ones (that are actually more similar to the current situation) in June 2017, on Dec 1, 2017 and in late February 2018. They were all followed by declines practically right away and it seems that today’s pre-market decline proves that history is repeating itself. It was not a good idea to be invested in gold back then, it’s doesn’t seem to be a good idea right now (except for the insurance capital, that is).

Silver’s Daily “Strength” Invalidated



Read more...

Banner

Asset protection

LIVE WORKSHOP - Tax Smart Investing for Professionals & Business Owners

Share on Facebook Tweet on Twitter

Posted by MoneyTalks Editor

on Friday, 30 March 2018 12:51

We have chronicled the on-going efforts by government to target Canadian small businesses and professionals. We are pleased to be able to recommend an opportunity to learn several key ways Private Corporation Shareholders dramatically cut their income tax.

Andrew Ruhland and the team at Integrated Wealth Management are putting on a series of LIVE workshops across Western Canada. Seating is extremely limited so we suggest you reserve a space today. 

CLICK HERE to register

Calgary - April 3rd, 5th, 9th & 14th

Edmonton - April 4th

Victoria - April 10th

Vancouver - April 11th & 12th

Langley - April 12th

tax workshop



Banner

Asset protection

How to Exploit an Inefficient Market

Share on Facebook Tweet on Twitter

Posted by Dash of Insight

on Thursday, 29 March 2018 09:18

Exploiting inefficiencies using two recent examples, Facebook and Nvidia (the artificial intelligence/self driving stock). In the one case selling is justified, in the other buying the panic makes more sense - R. Zurrer for Money Talks

The Efficient Market Hypothesis is a mainstay of academic thinking about financial markets. It is rejected by many traders and money managers. Warren Buffett, for example, famously said that he would be on a corner, selling pencils from a tin cup if markets were efficient.

I do not expect to settle this decades-long debate in a single blog post. Instead, I will share how my own personal thinking changed along with my career – from college professor, to financial analyst, and to investment manager. I hope to stimulate and to provoke; we can all benefit from some wise comments. I will also suggest a few ideas we might consider to exploit inefficiency.

Provocative Examples

It is often useful to have a specific example in mind. Let’s start with Facebook (FB), a company familiar to all. Here is a chart of recent stock action:

032818 0149 HowtoExploi1

....continue reading HERE



Banner

Asset protection

How To Protect Yourself from Bubbles & Soon To Be Worthless Currencies

Share on Facebook Tweet on Twitter

Posted by Gary Christensen - The Deviant InvestorInvestor

on Wednesday, 14 March 2018 12:00

Zero interest rates, ballooning 230 Trillion in Global Government debt will ultimately set up as Voltaire said “Paper money eventually returns to its intrinsic value — zero.”. There are a lot of dangers and history tells us what we can expect. Even former Federal Reserve Chairman Alan Greenspan warns about the existing bond and stock bubbles. Gary Christensen spells out what investors must do to protect themselves in this well written article - R. Zurrer for Money Talks. 

Shooting Ourselves In the Foot

Serious problems affect Americans. Problems first, solutions at the end! 

We did what to ourselves? Our representatives, senators, and Presidents, supposedly acting on our behalf, voted for and created what history has shown are huge monetary and fiscal mistakes.

Some will disagree, but consider this partial list:

1 – Central banking and The Federal Reserve Act: Enough money was spread around Washington D.C. to purchase the passage of this self-serving banking monstrosity. It was signed into law by President Wilson over a century ago.

David Stockman has a clear assessment and firm opinions regarding the danger and destructiveness of the Central Bank. His statement is:

“Folks, these people aren’t totally stupid. They have amassed extraordinary power and plenary dominance over the nation’s $19 trillion capitalist economy only by assiduously cultivating the mother of all Big Lies. Namely, the myth that private capitalism is dangerously unstable and possessed of an economic death wish for periodic cyclical collapses, which can be forestalled only by the deft interventions of the central bank.

“That’s self-serving malarkey, of course. Every recession of the modern Keynesian era has been caused by the Federal Reserve, and most especially the calamity of 2008-2009. And the “recovery” from that one, as well as those stretching back to the 1950s, was owing to the inherent regenerative powers of the free market, not the interest rate and credit supply machinations of the Fed.

“So what we really have is a case of the monetary Wizard of Oz. There is nothing behind the Eccles Building curtain except a posse of essentially incompetent economic kibitzers who spend 90% of the time slamming the same old “buy” key on the Fed’s digital printing press, while falsely claiming credit for the inherent growth propensity of private capitalism.”

word-image-6
2 – Fiat Currencies: When the currency is backed by nothing it will become worthless. Voltaire recognized this fact centuries ago when he said, Paper money eventually returns to its intrinsic value — zero.”

Dollar bills (paper and digital) are “Notes” – DEBTS of the Federal Reserve. They are not money, but are merely an “IOU” issued by the Fed. We are legally required to use these “IOUs” for taxes and commerce.

3 – Fractional Reserve Banking: Allowing commercial banks to loan dollars into existence creates rising prices and much mischief. The Treasury will not condone individuals counterfeiting Federal Reserve Notes, but they allow commercial banks to do the equivalent.

4 – Too Big To Fail: They have created the myth that certain banks are too large and must not be allowed to fail. The Fed and large banks promoted this self-serving nonsense.

5 – Regulatory Capture: Create an agency to oversee banks (pharmaceutical companies, military contractors, securities sales etc.) and staff the agency with “tainted” members from the same industry.

Example: The SEC did not discover the Madoff scam even after receiving detailed analysis from Harry Markpolous showing how to prove the Ponzi scheme. Madoff confessed and the SEC was late to the game.

6 – Derivatives: They are profitable for banks at the expense of the economy. Failed derivatives nearly killed the economy in 2008. A larger disaster is coming.

7 – Banks Own and Strongly Influence Politicians and the Media: No discussion needed.

8 – We Live In a Credit Based World: Banks skim a piece off most transactions. Has “financializing” everything improved the lives of the citizens? What happens if credit dries up – again – as it did in 2008? Will existing bank loans be called, will ATM’s cease functioning, will world trade crash?

9 – War on Cash: Banks demand maximum control, which means they want our assets, liabilities and transactions digitized inside their world. If all assets are “banked,” the only escape is cash – UNLESS CASH IS OUTLAWED. Once assets are “banked” then banks can confiscate assets via negative interest rates, transaction fees, and monthly charges.

10 – Central Banks Lowered Interest Rates to Near Zero: Rates went negative in Europe. Your “high interest” checking account probably pays less than 0.05% interest. Savers, insurance companies, and pension plans have been damaged by low interest rates, but those low rates benefitted bank profits.

11 – U.S. Government Deficit Spending: The Treasury borrows every month, spends more than its revenues, increases debt, and pretends all is well. The “debt ceiling” is a joke. Read 38,000 Tons of Poison.

George Carlin: “It’s a big club and you ain’t in it.”

SOLUTIONS:



Read more...

Banner

<< Start < Prev 1 2 3 4 5 6 7 8 9 10 Next > End >> Page 2 of 95

Free Subscription Service - sign up today!

Exclusive content sent directly to your Inbox

  • What Mike's Reading

    His top research pick

  • Numbers You Should Know

    Weekly astonishing statistics

  • Quote of the Week

    Wisdom from the World

  • Top 5 Articles

    Most Popular postings

Learn more...



Our Premium Service:
The Inside Edge on Making Money

Latest Update

Photon Control Up-Lists to TSX

Posts record Backlog & Stock Hits New Highs This month we update Photon Control Inc. (TSX-V: PHO) which was recommended this time last...

- posted by Ryan Irvine

Michael Campbell Robert Zurrer
Tyler Bollhorn Eric Coffin Jack Crooks Patrick Ceresna
Josef Mark Leibovit Greg Weldon Ryan Irvine