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January, 2016 Archives

Richard's Thoughts on Gold

By the Dow Theory Team

 

Richard's Comments

 

Question -- Why is gold the ultimate safe-haven investment?

 

Answer -- Because gold is the only item that can't go bankrupt. For thousands of years, gold has been treated as pure wealth.

 

As far as I can see, there's only one "safe haven" in the rapidly changing world of today. It's an item that has served as a safe haven for 6,000 years.

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A City of Teslas

By Benjamin J. Butler

 

Seoul, South Korea

 

I am on a train from Daegu City to Seoul in South Korea to meet a friend. In a sign of our times, he - a well-respected businessman and entrepreneur in Korea - is looking for financing from US sources for his chip company. Local sources of funding are not so easy to come by as in Silicon Valley, and if he does procure capital, it's from the wrong source. Other friends of mine in Korea are talking about how Chinese VCs have just “discovered” Korea and are looking to invest more money into startups here.

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Two High-Yield Survivors Yielding Up to 5%

By Dr. Carla Pasternak

 

As U.S. stocks posted the worst-ever start of the year and earnings season threatens to intensify the volatility, it's easy to lose sight of the big picture. Select stocks that have held up well over the near-term, with strong earnings prospects, are worth considering when the dust settles.

 

These two picks, for example, saw double-digit gains even while the S&P 500 ($SPX) lost more than 3% in the past 18 months. Lamar Advertising (Nasdaq: LAMR) rallied 18% and iShares Residential Real Estate Capped ETF (NYSE: REZ) over 20%.

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Inflate or Die

By Jon S. Strebler

 

That was Mr. Russell’s mantra for many years, as he sought to describe the U.S.’s options for dealing with its massive debts. And that was back in the 1980s and 1990s, before those debts really boomed. The idea was that inflation made it much easier to service and even pay off debts, as it created greater tax revenues and reduced the “real” (adjusted for inflation) amount of debt. Thus, in the battle between fighting unemployment and fighting inflation, government has a vested interest in focusing on the former and leaving the latter for later.

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Sovereign Wealth Funds Add to Selling Pressure

By Matthew Kerkhoff

 

With oil and the rest of the commodity complex having collapsed in price, revenues from commodity exports have declined substantially for commodity producing nations. Major currency fluctuations, including the massive rise in the dollar, are also forcing many governments to intervene in currency markets (using their reserves) in an attempt to stabilize exchange rates.

 

Both of these factors point to one outcome: many SWFs are in dire need of raising or protecting capital. Could this be a major source of the market’s recent rut?

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Richard's Thoughts on the Bear Market

By the Dow Theory Team

 

Richard's Comments

 

We can't control the stock market. The very best we can do is to try to understand what the stock market is trying to tell us.

There's only one crystal ball that reflects the future of business and economics. That crystal ball is the stock market. There's only one forecaster for the stock market. That forecaster is the market itself.

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