Archive for November 2009

Retail Sales Advance on Black Friday Not Enough

The recent news on the retail sales on the Black Friday, deemed by most analysts to be the most important indicator of the sector for the whole year, advanced by 0.5% versus last year (2008),according to ShopperTrak RCT Corp.  Should this be enough to lift the retail stocks?

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Book Review – “Currency Trading For Dummies” by Brian Dolan and Mark Galant

A simple search on this title over any search engine will show you the true power of the concept – there are 118,000 results only on Google. I don’t know if this because of the “Dummies” franchise or because of the number of traders willing to learn the ropes of the field. Certainly there is an incredibly high demand for this title and the reasons are simple – the demand for online currency trading is surging. Read more

Dubai Default Will Depress the Oil Prices

The recent news that Dubai suspended the repayment of its $59 billion debt sent shockwaves through the markets. Some shockwaves were expected, others came completely out of the blue.
In the first category there are the news of the spreads widening. In the second enter the appreciation of the yen, completely unexpected. Nobody was thinking that the panic will make the yen become what it was once – a safe haven for the investors. Yet, the yen continues to trade higher and higher.
The main resource of Dubai was the oil. And the government from Dubai has to repay somehow their debts. Even in the case of default, they must repay at least partially those bonds. It means that the Dubai sovereign funds and the Dubai asset owners must pump more oil to sell on the global market. Read more

Oil Prices Creep Back

There is a lot of debate whether the oil will come back or not to the levels from 2008 (mostly May and June levels, where it reached a peak of $140/barrel. Since then, it continued to drop until February 2009, since it started again to grow. This time, in a much slower manner.

It is true that the recent economical news are slightly better than the previous ones. The US GDP has decreased in quarter 3within the economists expectations. The important word here is “decreased”. And the S&P 500 companies have seen a small recovery. Yet, I think we are several months from the economic recovery whcih could turn recession into a growth trend.

And of course, there is a debate of whether oil prices will anticipate these oil price increases or whether it will go down further, before it picks up. Read more

Is General Electric the Company for Very Long Positions?

The truth is that is a really tricky question. Why is that? First of all GE is one of the largest companies in the world, and to foresee its direction with precision is slightly impossible (to use kind words). It is such a big company, that probably not even their own directors have an exact idea of where it is going to head for the next 6-12 months…
Yet, the analysts remain convinced that the current share price ($16.1/share) might go even upper in the incoming weeks. Some analysts mention $17 share, others even recommend entering long positions with GE since a recovery will come sometimes for GE.
The analysts point at its strong rating (AAA-), at its strong profit margin (9.54%) and its strong ROE (16.4%) for 2008. Impressive indeed. What those analysts ignore that those financial parameters went down substantially in 2009 and that no one knows when and how much will they turn around. It might seem logical, but my opinion is that most of the analysts are ignoring the simple truth that a crisis recovery takes 1.5 to 2 times longer than the plunge. And we have just seen the first signs of the recovery, but… Read more

“Capturing Profit with Technical Analysis: Hands-on Rules for Exploiting Candlestick, Indicator, and Money Management Techniques” By Sylvain Vervoort – A Book Review

Technical analysis is one of my passions, so here we go with another recent release of a book focusing on that topic. Given the recent advent of the online trading platforms (e.g the MetaTrade 4 or MT), trading has ecome much easier than a few years ago. In the same time, it has become also much more dangerous, since the easiness of trading is simply translated into a greater risk for the trader. And risk means the possibility to have huge profits in a short time, but also the possibility to be wiped out from the market very quickly. Being wiped out from a trading platform means loosing all the money you deposited as a leverage (your trading capital, of course).

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Unemployment Rate Increase – What Does It Mean for Recent Graduates?

copac-luminat-dimineata-devreme-gradina-botanica-anastaise-fatu-iasi-morning-light-on-a-tree-from-the-botanical-garden-of-iasi-october-2009One interesting question was asked by the Forbes panel yesterday:
“What does the recent jump in the unemployment rate (to 10,2%, as reported by the US Bureau of Statistics) mean for the recent college graduates and others entering the job market for the first time in this employment climate? What would you counsel them?”
It is a provocative question, since we live in a challenging economic environment. And it looks quite difficult to be optimistic when the US companies continue to reduce their payrolls by limiting the number of the new employees and reducing those with the lowest company service years.
Yet, the crisis would not last forever. Yes, this is my first advice, similar to the Bible adagio – “Be always ready.” The turnaround is closer than you might think. 6 months might look like an eternity when you are unemployed and have very slim chances to get your dream job, yet these months might pass very quickly. And the best you can do is to prepare yourself.
How? Read more