Since the internet, the world has no limits for financial market investors. From the comfort or our homes we can decide for our financial future or the future of our company.
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Showing posts with label Taxes. Show all posts
Showing posts with label Taxes. Show all posts
Sunday, August 8, 2010
What does it mean to be a Financial Market Investor
On a today's basis, only about 2% of the people who have investments in the world financial markets base their decisions of a sound education. See the magnitude of being a financial market investor to check and balance with your skills to succesfully trade up, down and sideways markets.
Since the internet, the world has no limits for financial market investors. From the comfort or our homes we can decide for our financial future or the future of our company.
The world Financial Markets:
NeverLossTrading analyzed and evaluated all those markets to provide you with a list of securities ……
Download the entire article of our website: http://neverlosstrading.com/Financial_Market_Investor.html
Since the internet, the world has no limits for financial market investors. From the comfort or our homes we can decide for our financial future or the future of our company.
Saturday, August 7, 2010
Stock Markets: Economic Growth Paired with High Unemployment
“Economic growth with continued high unemployment will lead to stock market growth and deep short term corrections. A dangerous trading ground for the small investor.”
We said it in multiple of our publications: The US economy is in a an uptrend with high and to be continued unemployment. As a point of reference: http://NeverLossTrading.wordpress.com.
Friday, the Labor Department said that non-farm payroll employment fell by 131,000 jobs in July following a revised decrease of 221,000 jobs in June. Economists had expected employment to drop by 87,000 jobs compared to the loss of 125,000 jobs originally reported for the previous month.
At the same time, the report showed that the unemployment rate came in unchanged compared to the previous month at 9.5 percent, reflecting a decrease in the size of the labor force. Besides those jobs that disappear many of the non-registered workers are out of jobs or even out of the country. So we definitively have a decrease in size of labor registering for unemployment.
This is a big issue for the government is to cope with the additional costs and requirements of a 10% unemployment rate. A long needed restructuring of taxes, health care and social benefits is on the horizon. As a result of ongoing good corporate earnings and growth we will see economic progress which lets the markets climb, followed by sharp pullbacks on all issues to cope with the high unemployment.
Supporting indicators for our assumptions:
Kraft Foods Inc. said that its second quarter profit rose 13 percent from last year. However, quarterly revenues came in positive but lower than forecast, and the company trimmed its full year revenue growth projections.
Healthcare provider stocks are posting some of today’s steepest losses, resulting in a 2.4 percent drop by the Morgan Stanley Healthcare Provider Index.
Look alone at Fridays trend of the major indexes and this just shows on the short term what to be expected long term.
The smart money is always ahead, and we put your right at par when you learn how to make money when markets go up, down or sideways.
NeversLossTrading is a premier education institute focusing to teach small group of investors how they can leverage and hedge their assets, in each of their accounts: 401(k), IRA, Custodian, Personal. Due to working with small groups only the best to get in touch with them is: contact@NeverLossTrading.com
We said it in multiple of our publications: The US economy is in a an uptrend with high and to be continued unemployment. As a point of reference: http://NeverLossTrading.wordpress.com.
Friday, the Labor Department said that non-farm payroll employment fell by 131,000 jobs in July following a revised decrease of 221,000 jobs in June. Economists had expected employment to drop by 87,000 jobs compared to the loss of 125,000 jobs originally reported for the previous month.
At the same time, the report showed that the unemployment rate came in unchanged compared to the previous month at 9.5 percent, reflecting a decrease in the size of the labor force. Besides those jobs that disappear many of the non-registered workers are out of jobs or even out of the country. So we definitively have a decrease in size of labor registering for unemployment.
This is a big issue for the government is to cope with the additional costs and requirements of a 10% unemployment rate. A long needed restructuring of taxes, health care and social benefits is on the horizon. As a result of ongoing good corporate earnings and growth we will see economic progress which lets the markets climb, followed by sharp pullbacks on all issues to cope with the high unemployment.
Supporting indicators for our assumptions:
Kraft Foods Inc. said that its second quarter profit rose 13 percent from last year. However, quarterly revenues came in positive but lower than forecast, and the company trimmed its full year revenue growth projections.
Healthcare provider stocks are posting some of today’s steepest losses, resulting in a 2.4 percent drop by the Morgan Stanley Healthcare Provider Index.
Look alone at Fridays trend of the major indexes and this just shows on the short term what to be expected long term.
The smart money is always ahead, and we put your right at par when you learn how to make money when markets go up, down or sideways.
NeversLossTrading is a premier education institute focusing to teach small group of investors how they can leverage and hedge their assets, in each of their accounts: 401(k), IRA, Custodian, Personal. Due to working with small groups only the best to get in touch with them is: contact@NeverLossTrading.com
Thursday, August 5, 2010
Stock Markets: Are We Getting Into A Downtrend?
We are facing a time of an growing economy and continues high unemployment rates. There are many indicators speaking for a longer term growth with sharp market corrections. See our arguments.
Before the start of trading this morning, the Labor Department reported that initial jobless claims rose to 479,000 in the week ended July 31st from the previous week's revised figured of 460,000.
Is that really a surprise?
As often reported prior, the US for the first time is faced with a continues high unemployment level, as most European countries are used to since 30 years.
The market sure reacted negative and all kind of little explanations for a big structural problem were found: GM shutdowns (as if they were not there last year)
Our interpretation: We will have consumers who can spend, because they have a job and others who cannot, because they do not have a job.
Look at the retail reports from morning: A number of key chain stores reporting comparable July store sales. BJ's Wholesale (BJ) reported that its July comps rose by 6 percent, Nordstrom (JWN) said its sales increased by 7.6 percent, Kohl's (KOHL) sales advanced by 7.1 percent and sales by Macy's (M) jumped by 11 percent.
Now a key economic indicator: Freight & Transportation and Logistics Services company Con-way Inc. (CNW) posted second-quarter net income that was nearly 24 percent higher compared to the same period last year but still missed projections.
Let us puzzle it together:
“We are facing a period of economic growth where unemployment continues as an unresolved issue: American Companies got used to work with less people and will not rehire proportionate, even though they grow.”
Some more economic facts:
Yesterday, ISM revealed that its non-manufacturing index rose to 54.3 in July from 53.8 in June, with a reading above 50 indicating continued growth in the service sector. Economists had been expecting the index to edge down to a reading of 53.0.
In earnings news, PulteGroup Inc. (PHM) reported second-quarter net income of $0.20 per share, while analysts expected the company to report a loss of $0.01 per share. Total revenues for the quarter surged up to $1.31 billion from $678.58 million in the prior year quarter.
Media and entertainment giant Time Warner Inc. (TWX) said its second-quarter earnings rose to $0.49 per share, topping forecasts for $0.45 per share for the period. Revenues for the quarter grew 8 percent to $6.4 billion, while analysts expected revenues of $6.20 billion.
Additionally, Japanese automaker Toyota Motor Corp. (TM) said it swung to a profit in the first quarter compared to a loss in t he same period last year, helped by 27 percent revenue growth on the strength of Asian sales and demand-stimulus programs in Japan.
So what will all this mean for the Stock Market Investor:
We assume that we continue on a bullish sentiment with sharp negative pullbacks. Our outlook even goes for the next 5-10 years. Why? It will take that long for the government to deal with the restructuring of the taxation system to cope with long term unemployment, health care and social benefits for people who cannot find a job. Each time such news will hit the market it will take away quick from the levels that will be build by continues rising corporate earnings and growth.
For the investor it means to learn how to trade the market in all directions and how to hedge assets besides using a stop loss. NeverLossTrading.com teaches small groups up to 15 how to build and secure a long term portfolio of 401(k), IRA, Personal, Custodian accounts. One of their quotes: “People think that they cannot hedge (secure) their 401(k) investment because they have to stick to the investment vehicles of the plan provider. The plan is sure what the plan is and we will not change it, but add additional instruments that will make your investments long term grow and protect against sharp declines.”
Before the start of trading this morning, the Labor Department reported that initial jobless claims rose to 479,000 in the week ended July 31st from the previous week's revised figured of 460,000.
Is that really a surprise?
As often reported prior, the US for the first time is faced with a continues high unemployment level, as most European countries are used to since 30 years.
The market sure reacted negative and all kind of little explanations for a big structural problem were found: GM shutdowns (as if they were not there last year)
Our interpretation: We will have consumers who can spend, because they have a job and others who cannot, because they do not have a job.
Look at the retail reports from morning: A number of key chain stores reporting comparable July store sales. BJ's Wholesale (BJ) reported that its July comps rose by 6 percent, Nordstrom (JWN) said its sales increased by 7.6 percent, Kohl's (KOHL) sales advanced by 7.1 percent and sales by Macy's (M) jumped by 11 percent.
Now a key economic indicator: Freight & Transportation and Logistics Services company Con-way Inc. (CNW) posted second-quarter net income that was nearly 24 percent higher compared to the same period last year but still missed projections.
Let us puzzle it together:
“We are facing a period of economic growth where unemployment continues as an unresolved issue: American Companies got used to work with less people and will not rehire proportionate, even though they grow.”
Some more economic facts:
Yesterday, ISM revealed that its non-manufacturing index rose to 54.3 in July from 53.8 in June, with a reading above 50 indicating continued growth in the service sector. Economists had been expecting the index to edge down to a reading of 53.0.
In earnings news, PulteGroup Inc. (PHM) reported second-quarter net income of $0.20 per share, while analysts expected the company to report a loss of $0.01 per share. Total revenues for the quarter surged up to $1.31 billion from $678.58 million in the prior year quarter.
Media and entertainment giant Time Warner Inc. (TWX) said its second-quarter earnings rose to $0.49 per share, topping forecasts for $0.45 per share for the period. Revenues for the quarter grew 8 percent to $6.4 billion, while analysts expected revenues of $6.20 billion.
Additionally, Japanese automaker Toyota Motor Corp. (TM) said it swung to a profit in the first quarter compared to a loss in t he same period last year, helped by 27 percent revenue growth on the strength of Asian sales and demand-stimulus programs in Japan.
So what will all this mean for the Stock Market Investor:
We assume that we continue on a bullish sentiment with sharp negative pullbacks. Our outlook even goes for the next 5-10 years. Why? It will take that long for the government to deal with the restructuring of the taxation system to cope with long term unemployment, health care and social benefits for people who cannot find a job. Each time such news will hit the market it will take away quick from the levels that will be build by continues rising corporate earnings and growth.
For the investor it means to learn how to trade the market in all directions and how to hedge assets besides using a stop loss. NeverLossTrading.com teaches small groups up to 15 how to build and secure a long term portfolio of 401(k), IRA, Personal, Custodian accounts. One of their quotes: “People think that they cannot hedge (secure) their 401(k) investment because they have to stick to the investment vehicles of the plan provider. The plan is sure what the plan is and we will not change it, but add additional instruments that will make your investments long term grow and protect against sharp declines.”
Friday, July 30, 2010
Stock Market News by NeverLossTrading: Where is the Economy and the Stock Market Heading Towards?
We still have a mixed bag of fantastic earnings and uncomfortable economic news. Today we first picked up a bearish sentiment and later in the day the news got digested and turned into a more positive outlook.
What is going on?
Our summary: American Corporations got more efficient and will never rehire the amount of people they worked with prior. Basically the Government now employs all those qualified and willing to work people on the unemployment role. Europe has that problem since 30 years, now America got hit. The economy is growing. This week we have seen consumer companies and all others reporting growth in revenue and fantastic earnings. What was shown in earnings is just fabulous. When stocks are measured on P/E (price/earnings) we have a season of growth in front of us. But on the other side America has to get used to 10% unemployment and needs to restructure taxation, healthcare and lending policies, which will affect three big and influential Dow and S&P sectors: Financials, Banking, Healthcare. With an overall need for restructuring value added tax and the entire taxation system, all sectors will take a beating. But you know what: there is no place like America in respect of dealing with changes –whatever comes along will be turned into being ahead of the world and more profitable.
For all financial market investors times of as season of uprising stock prices based on growth and profitability is ahead of us, followed by beaten down bear rallies on every change in lending, taxation and healthcare that will need to come our way. For those who like to make money through financial market investments (401(k), IRA, Personal, Custodian, Margin Accounts) in the next 5-10 years, you better learn to make money in up, down and sideways markets bye hedging and leveraging your investments: NeverLossTrading.com is here to teach you.
Today July 30, 2017, Thomson Reuters and the University of Michigan released their final report on consumer sentiment in the month of July, showing that the consumer sentiment index was upwardly revised by more than expected but continued to show a notable deterioration in sentiment compared to June. The report showed that the consumer sentiment index for July was upwardly revised to a reading of 67.8 from the preliminary estimate of 66.5. While the revised reading came in above economist estimates of 67.5, it remained well below the June reading of 76.0. Whatever face lifting we do, consumers are not confident in the economy yet. The high unemployment with no clear solution brings a Bearish Sentiment.
Richard Curtin, Surveys of Consumers chief economist, said, "Scarce jobs and stagnating incomes have been the top concerns of consumers for some time."
The Institute for Supply Management - Chicago said its business barometer rose to 62.3 in July from 59.1 in June, with a reading above 50 indicating growth in Chicago-area business activity. The increase surprised economists, who had expected the index to fall to a reading of 56.3. This is sure not a surprise: raising profits and cash on hand give a better outlook: Bullish Sentiment.
The Commerce Department said that gross domestic product: GDP increased at an annual rate of 2.4 percent in the second quarter compared to the revised 3.7 percent jump seen in the first quarter. Economists had expected GDP to increase by 2.5 percent compared to the 2.7 percent growth that had been reported for the first quarter. The economy is growing, price competition still keeps the growth in a smaller scale but overall a Bullish Sentiment.
Earnings News:
Chevron Corp. (CVX) reported second-quarter net income of $2.70 per share, up from $0.87 per share in the same quarter last year. Wall Street analysts expected the company to report earnings of $2.44 per share for the quarter. The firm posted revenues of $51.05 billion, which was short of the $52.52 billion projected by analysts.
Merck & Co. Inc. (MRK) reported adjusted second-quarter net income of $0.86 per share, topping expectations for $0.83 per share. Unadjusted net profit fell by roughly 50 percent to $0.24 per share. Sales for the quarter came in at $11.35 billion, short of the consensus estimate for $11.45 billion.
What is going on?
Our summary: American Corporations got more efficient and will never rehire the amount of people they worked with prior. Basically the Government now employs all those qualified and willing to work people on the unemployment role. Europe has that problem since 30 years, now America got hit. The economy is growing. This week we have seen consumer companies and all others reporting growth in revenue and fantastic earnings. What was shown in earnings is just fabulous. When stocks are measured on P/E (price/earnings) we have a season of growth in front of us. But on the other side America has to get used to 10% unemployment and needs to restructure taxation, healthcare and lending policies, which will affect three big and influential Dow and S&P sectors: Financials, Banking, Healthcare. With an overall need for restructuring value added tax and the entire taxation system, all sectors will take a beating. But you know what: there is no place like America in respect of dealing with changes –whatever comes along will be turned into being ahead of the world and more profitable.
For all financial market investors times of as season of uprising stock prices based on growth and profitability is ahead of us, followed by beaten down bear rallies on every change in lending, taxation and healthcare that will need to come our way. For those who like to make money through financial market investments (401(k), IRA, Personal, Custodian, Margin Accounts) in the next 5-10 years, you better learn to make money in up, down and sideways markets bye hedging and leveraging your investments: NeverLossTrading.com is here to teach you.
Today July 30, 2017, Thomson Reuters and the University of Michigan released their final report on consumer sentiment in the month of July, showing that the consumer sentiment index was upwardly revised by more than expected but continued to show a notable deterioration in sentiment compared to June. The report showed that the consumer sentiment index for July was upwardly revised to a reading of 67.8 from the preliminary estimate of 66.5. While the revised reading came in above economist estimates of 67.5, it remained well below the June reading of 76.0. Whatever face lifting we do, consumers are not confident in the economy yet. The high unemployment with no clear solution brings a Bearish Sentiment.
Richard Curtin, Surveys of Consumers chief economist, said, "Scarce jobs and stagnating incomes have been the top concerns of consumers for some time."
The Institute for Supply Management - Chicago said its business barometer rose to 62.3 in July from 59.1 in June, with a reading above 50 indicating growth in Chicago-area business activity. The increase surprised economists, who had expected the index to fall to a reading of 56.3. This is sure not a surprise: raising profits and cash on hand give a better outlook: Bullish Sentiment.
The Commerce Department said that gross domestic product: GDP increased at an annual rate of 2.4 percent in the second quarter compared to the revised 3.7 percent jump seen in the first quarter. Economists had expected GDP to increase by 2.5 percent compared to the 2.7 percent growth that had been reported for the first quarter. The economy is growing, price competition still keeps the growth in a smaller scale but overall a Bullish Sentiment.
Earnings News:
Chevron Corp. (CVX) reported second-quarter net income of $2.70 per share, up from $0.87 per share in the same quarter last year. Wall Street analysts expected the company to report earnings of $2.44 per share for the quarter. The firm posted revenues of $51.05 billion, which was short of the $52.52 billion projected by analysts.
Merck & Co. Inc. (MRK) reported adjusted second-quarter net income of $0.86 per share, topping expectations for $0.83 per share. Unadjusted net profit fell by roughly 50 percent to $0.24 per share. Sales for the quarter came in at $11.35 billion, short of the consensus estimate for $11.45 billion.
Tuesday, July 27, 2010
Stock Market News: Are we Bullish or Bearish
What did the news say today?
• a more sizable than forecast pickup in home prices , solid corporate earnings, S&P Growth: Bullish
• a disappointing reading on consumer confidence: Bearish.
What do the news tell us today?
We are having an economic recovery with continues high unemployment. This was all seen in Europe and started there 30 years ago. To cope with this problem Europe restructured and build a sound welfare system: When companies don’t employ people, they need to live from something. This is sure unknown for America and seeing your neighbor unemployed for long even though he is skilled and willing to work makes consumers growing increasingly more pessimistic about the short-term outlook.
The consumer sentiment will change: Corporations will no more run layoffs and those who work will feel money to spend which will change their sentiment, but it will take.
The government has to restructure unemployment support, availability of health care and the taxation system to handle 10% unemployment in their balance sheet.
So short term we are getting ready for a bullish market sentiment and every time the government or Fed will touch one of the instruments they have to cope with the overall unemployment problem: interest, tax, healthcare, welfare. The market will go berserk and give us big junks of retracements.
What do we do to benefit from this: Swing Positions in options, Day Positions in Futures and Currencies no Equities (Shares, Mutual Funds, ETF’s). To handle those types of investments we highly recommend a Market Investor Education with http://NeverLossTrading.com
Here are a few more overall bullish market indicators. Today we take on the Chemical industry, it usually provides and early economic indicator and the sings are: Bullish.
DuPont (DD) reported adjusted second-quarter net income of $1.17 per share, firmly topping forecasts for $0.93 per share. Net sales for the quarter came in at $8.62 billion, also beating expectations that called for $8.23 billion for the period. The European based second chemical giant: BASF is doing as well or even better.
BP Plc (BP) unveiled a $17.2 billion second-quarter loss due to $32.2 billion in charges related to the oil spill in the Gulf of Mexico. The loss came after a profit of $4.39 billion in the same period last year. The firm also named managing director Robert Dudley as its new chief executive, replacing Tony Hayward, starting in October. Dudley will be the first American to head the company. From an investor perspective, BP assumes to get away within spending about a 1 year income to clean up the oil spill generated and wants to get out of the news by replacing the CEO (sure we do not need to worry about him, he has a package that gets him over the hump).
• a more sizable than forecast pickup in home prices , solid corporate earnings, S&P Growth: Bullish
• a disappointing reading on consumer confidence: Bearish.
What do the news tell us today?
We are having an economic recovery with continues high unemployment. This was all seen in Europe and started there 30 years ago. To cope with this problem Europe restructured and build a sound welfare system: When companies don’t employ people, they need to live from something. This is sure unknown for America and seeing your neighbor unemployed for long even though he is skilled and willing to work makes consumers growing increasingly more pessimistic about the short-term outlook.
The consumer sentiment will change: Corporations will no more run layoffs and those who work will feel money to spend which will change their sentiment, but it will take.
The government has to restructure unemployment support, availability of health care and the taxation system to handle 10% unemployment in their balance sheet.
So short term we are getting ready for a bullish market sentiment and every time the government or Fed will touch one of the instruments they have to cope with the overall unemployment problem: interest, tax, healthcare, welfare. The market will go berserk and give us big junks of retracements.
What do we do to benefit from this: Swing Positions in options, Day Positions in Futures and Currencies no Equities (Shares, Mutual Funds, ETF’s). To handle those types of investments we highly recommend a Market Investor Education with http://NeverLossTrading.com
Here are a few more overall bullish market indicators. Today we take on the Chemical industry, it usually provides and early economic indicator and the sings are: Bullish.
DuPont (DD) reported adjusted second-quarter net income of $1.17 per share, firmly topping forecasts for $0.93 per share. Net sales for the quarter came in at $8.62 billion, also beating expectations that called for $8.23 billion for the period. The European based second chemical giant: BASF is doing as well or even better.
BP Plc (BP) unveiled a $17.2 billion second-quarter loss due to $32.2 billion in charges related to the oil spill in the Gulf of Mexico. The loss came after a profit of $4.39 billion in the same period last year. The firm also named managing director Robert Dudley as its new chief executive, replacing Tony Hayward, starting in October. Dudley will be the first American to head the company. From an investor perspective, BP assumes to get away within spending about a 1 year income to clean up the oil spill generated and wants to get out of the news by replacing the CEO (sure we do not need to worry about him, he has a package that gets him over the hump).
Saturday, July 10, 2010
A New Earnings Season: What Will The Stock Market Do Next?
Summary: The financial market are up for turbulent times with short term growth and fall for the next 10 years. NeverLossTrading highly recommends for people to learn to be financial market investors to build themselves a secure financial future and delivers many reasons why buy and hold will not pay us.
A New Earnings Season: What Will The Stock Market Do Next.
We are coming up to a new earnings season and what will we expect?
From our perspective: good sound earnings and even higher earnings. Look at the following graph and see yourself how corporate profits dipped in the year 2008/2009,by the melt down of the subprime mortgage crisis and now are back up, higher than ever.
Let us simplify the earnings statement of corporate America into: Sales – Costs – Depreciation = Earnings and we clearly see that the fall in corporate earnings was majorly driven by Depreciations of overstated earnings made in the years 2005 to 2008. Surely in the aftermath we all felt a slowing economy which meant less sales, but America restructured and coped with the challenge and now is back to lead the world in earnings.
What happened?
Sales stayed about the same and there were no more depreciations and costs: labor. got adjusted. As a result, corporate America makes more money than ever.
America got more efficient the productivity per capita employed went up tremendously. But this also means that we might need to live with a 10% unemployment rate as it is a given for 30 years in Europe for example.
Now corporate America shifted employment to the government and the government has the issue of how to finance the major shift of employment to unemployment.
When we look at the Federal or State balance sheet we simplify into: Taxes – Costs = Available Budget. With more unemployment the factor cost increased over proportionately. So far all stimulus programs did not work to reduce unemployment and with that the cost factor and a potential restructuring of the taxation system to produce more income might be needed.
This sure will create an outcry, but read me right, I am not saying that I want higher taxes, I am saying that the budgets do not hold, because of the increase of unemployment costs and the government will come to a point where printing more money for deficit spending has to come to an end.
So what will come next? Let us take a look at Europe, most of their countries are used to deal with unemployment rates of 10-12% for the last 30 years and what programs they have in place to survive:
Government funded general healthcare is a given: rich countries care about the health of their people. To administer such Europeans regulate the earnings of healthcare providers and in average they come up as 1/3 of what America pays with little to no difference in service. This for sure is a huge political issue, but would it not be a shame if the richest country in the world people have to die if they have no insurance? Sure, I know the argument that they should find a job, but if there is no job to be found, what to do?
Another wildfire, America might need a restructuring of the taxation system to make more income to cover the government spending. in a short comparison:
- Federal Tax: About the same in Europe.
- State Tax: Europeans usually have one federal tax and allocate state taxes.
- Municipal Taxes: The do not exist and when I am looking at the North-East of the United States, a lot of money is brought in and wasted.
- Value Added Tax: Europeans charge about 12% more and fund municipalities and states from the local accrued value added tax.
What does all that mean for the financial markets?
We will have great earnings reports one day and depressing jobless claims the next and by that we assume for the next – hold on to a rail – 5 to 10 YEARS we predict ping pong financial market, with short spikes up and down till the issues above are solved. The market drivers are:
Corporate America is back, and it's more profitable than ever. You might not believe the graph above, but these are actual earnings and not planned profits. When those earnings reports come out the market will: spike up.
The Government has its biggest deficit problem ever and every time they will touch one of the instruments to solve the issue, the stock market will go berserk and fall out of the skies. For now the Fed’s only choice is to print more money to be able to make it into the next election period which will put some short term pressure on the US-Dollar, make the Euro and the stock market rise for short.
If the government makes it to the next election period: Imagine a regulated health care program which would put the second biggest sector in the S&P 500 (Health Care) under pressure in earnings – and the markets will do like Humpty Dumpty.
Another hot potato, Restructuring of taxes with higher corporate and capital gain taxes. All sectors and in particular the Financial sector will make a real slump.
Corporate America is not the world for granted and will deal splendidly with all those changes and come back to make even more earnings to allow for relief and spikes up. On the other side, the short term sentiment usually runs the financial markets into the grounds and each time another depressing unemployment report comes out, we are there again.
In the turbulent times ahead of us, we can only recommend for people who want to achieve a positive outcome for their lives, to learn to be a FINANCIAL MARKET INVESTOR which entails:
- Forget buy and hold
- Learn how to leverage and protect your assets
NeverLossTrading.com is prepared to teach you to deal your money in up-, down- or sideways markets. Our key slogan is:
3 days to financial freedom - and we mean it.
Learn the instruments and investment methods that will keep you above water in the turbulent times ahead of us. You sure do not want to put 60% of your hard earned retirement money at risk.
Why do we tell here forget buy and hold? Isn’t the whole 401 (k) and our retirement build on it?
Yes, but it will not work anymore and here is the reason why: The S&P 500 (500 biggest companies by market capitalization) did not grow in the last 10 years and mostly will not do much in the next 10 years. Let us pick an example of one of the most recognized and well know companies out of the S&P 500: MSFT – Microsoft Corp. Had we invested since the year 2000 a monthly amount of $100 into Microsoft shares we would own 473 Shares today and their today’s value would be: $11,011 while we had invested: $12,658. This is a minus 13% return on our investment over 10 years and not the doubling of investments in 7 years that were anticipated.
We want to help people to get out of this financial trap.
For now we only teach small groups of people (up to 20 and by appointment only) so we can get our message across, even though we should talk to a filled Madison Square Garden to make obvious that it is our individual responsibility to obtain financial market knowledge that gets us into financially safe future.
A New Earnings Season: What Will The Stock Market Do Next.
We are coming up to a new earnings season and what will we expect?
From our perspective: good sound earnings and even higher earnings. Look at the following graph and see yourself how corporate profits dipped in the year 2008/2009,by the melt down of the subprime mortgage crisis and now are back up, higher than ever.
Let us simplify the earnings statement of corporate America into: Sales – Costs – Depreciation = Earnings and we clearly see that the fall in corporate earnings was majorly driven by Depreciations of overstated earnings made in the years 2005 to 2008. Surely in the aftermath we all felt a slowing economy which meant less sales, but America restructured and coped with the challenge and now is back to lead the world in earnings.
What happened?
Sales stayed about the same and there were no more depreciations and costs: labor. got adjusted. As a result, corporate America makes more money than ever.
America got more efficient the productivity per capita employed went up tremendously. But this also means that we might need to live with a 10% unemployment rate as it is a given for 30 years in Europe for example.
Now corporate America shifted employment to the government and the government has the issue of how to finance the major shift of employment to unemployment.
When we look at the Federal or State balance sheet we simplify into: Taxes – Costs = Available Budget. With more unemployment the factor cost increased over proportionately. So far all stimulus programs did not work to reduce unemployment and with that the cost factor and a potential restructuring of the taxation system to produce more income might be needed.
This sure will create an outcry, but read me right, I am not saying that I want higher taxes, I am saying that the budgets do not hold, because of the increase of unemployment costs and the government will come to a point where printing more money for deficit spending has to come to an end.
So what will come next? Let us take a look at Europe, most of their countries are used to deal with unemployment rates of 10-12% for the last 30 years and what programs they have in place to survive:
Government funded general healthcare is a given: rich countries care about the health of their people. To administer such Europeans regulate the earnings of healthcare providers and in average they come up as 1/3 of what America pays with little to no difference in service. This for sure is a huge political issue, but would it not be a shame if the richest country in the world people have to die if they have no insurance? Sure, I know the argument that they should find a job, but if there is no job to be found, what to do?
Another wildfire, America might need a restructuring of the taxation system to make more income to cover the government spending. in a short comparison:
- Federal Tax: About the same in Europe.
- State Tax: Europeans usually have one federal tax and allocate state taxes.
- Municipal Taxes: The do not exist and when I am looking at the North-East of the United States, a lot of money is brought in and wasted.
- Value Added Tax: Europeans charge about 12% more and fund municipalities and states from the local accrued value added tax.
What does all that mean for the financial markets?
We will have great earnings reports one day and depressing jobless claims the next and by that we assume for the next – hold on to a rail – 5 to 10 YEARS we predict ping pong financial market, with short spikes up and down till the issues above are solved. The market drivers are:
Corporate America is back, and it's more profitable than ever. You might not believe the graph above, but these are actual earnings and not planned profits. When those earnings reports come out the market will: spike up.
The Government has its biggest deficit problem ever and every time they will touch one of the instruments to solve the issue, the stock market will go berserk and fall out of the skies. For now the Fed’s only choice is to print more money to be able to make it into the next election period which will put some short term pressure on the US-Dollar, make the Euro and the stock market rise for short.
If the government makes it to the next election period: Imagine a regulated health care program which would put the second biggest sector in the S&P 500 (Health Care) under pressure in earnings – and the markets will do like Humpty Dumpty.
Another hot potato, Restructuring of taxes with higher corporate and capital gain taxes. All sectors and in particular the Financial sector will make a real slump.
Corporate America is not the world for granted and will deal splendidly with all those changes and come back to make even more earnings to allow for relief and spikes up. On the other side, the short term sentiment usually runs the financial markets into the grounds and each time another depressing unemployment report comes out, we are there again.
In the turbulent times ahead of us, we can only recommend for people who want to achieve a positive outcome for their lives, to learn to be a FINANCIAL MARKET INVESTOR which entails:
- Forget buy and hold
- Learn how to leverage and protect your assets
NeverLossTrading.com is prepared to teach you to deal your money in up-, down- or sideways markets. Our key slogan is:
3 days to financial freedom - and we mean it.
Learn the instruments and investment methods that will keep you above water in the turbulent times ahead of us. You sure do not want to put 60% of your hard earned retirement money at risk.
Why do we tell here forget buy and hold? Isn’t the whole 401 (k) and our retirement build on it?
Yes, but it will not work anymore and here is the reason why: The S&P 500 (500 biggest companies by market capitalization) did not grow in the last 10 years and mostly will not do much in the next 10 years. Let us pick an example of one of the most recognized and well know companies out of the S&P 500: MSFT – Microsoft Corp. Had we invested since the year 2000 a monthly amount of $100 into Microsoft shares we would own 473 Shares today and their today’s value would be: $11,011 while we had invested: $12,658. This is a minus 13% return on our investment over 10 years and not the doubling of investments in 7 years that were anticipated.
We want to help people to get out of this financial trap.
For now we only teach small groups of people (up to 20 and by appointment only) so we can get our message across, even though we should talk to a filled Madison Square Garden to make obvious that it is our individual responsibility to obtain financial market knowledge that gets us into financially safe future.
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