-- Posted Wednesday, 26 July 2006 | Digg This Article
| Source: GoldSeek.com
Rick’s Picks
Wednesday, July 26, 2006
For investors who’d rather be smart than lucky
Here’s a Wall Street Journal item from Tuesday that nicely encapsulates the current insanity: “Existing-home sales fell 1.3% in June and the inventory of unsold homes reached a new record, in further signs of a slowing housing market. However, a gauge of consumer confidence unexpectedly swung up.”
Just why the upswing in consumer confidence should have been “unexpected” is not entirely obvious, since we all know that the American consumer is nothing if not indefatigable. Nor have been investors timid in acknowledging this, as the chart below makes clear:
The chart shows Morgan Stanley’s Consumer Index hitting a new all-time high yesterday, notwithstanding serious deterioration in the housing sector, $3-plus gas, and steeply rising rates on many types of consumer loans. The index itself tracks the performance of consumer-oriented industries through price changes in 30 component stocks representing 20 industries – stocks like Colgate-Palmolive, Disney, Coca Cola, Johnson & Johnson, Proctor & Gamble, Safeway and Wal-Mart.
Some observers saw the five-day downtrend in oil prices as a sign that the Middle East war is unlikely to spin out of control. But then, maybe oil traders are proving to be just as nutty as American consumers, able to find a silver lining even in a mushroom cloud? We see the war winding down over the next couple of weeks, more on Israel’s terms than Hezbollah’s. But when it ceases to distract and investors focus anew on the thunderheads gathering on the economic horizon, better look out below!
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Big Changes at Rick’s Picks!
To expand and improve Ricks Picks’ paid-subscriber services, some exciting changes are coming. First, I will soon be opening a chat room on the Web site for those of you more interested in trading than in investing. It will be free to all regular subscribers, with a focus on identifying – and using – hidden-pivot swing points in real time.
In addition, long-term investors will soon find expanded coverage of stocks and commodities that more closely matches your needs. Look for timely commentary on Rick’s Picks’ inside pages of some of the key investment issues of the day, including deflation, a possible bird-flu pandemic, and the potentially catastrophic collapse of the housing bubble. Further details will be announced soon on the Inside Page.
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Information and commentary contained herein comes from sources believed to be reliable, but this cannot be guaranteed. Past performance should not be construed as an indicator of future results, so let the buyer beware. Rick's Picks does not provide investment advice to individuals, nor act as an investment advisor, nor individually advocate the purchase or sale of any security or investment. From time to time, its editor may hold positions in issues referred to in this service, and he may alter or augment them at any time. Investments recommended herein should be made only after consulting with your investment advisor, and only after reviewing the prospectus or financial statements of the company. Rick's Picks reserves the right to use e-mail endorsements and/or profit claims from its subscribers for marketing purposes. All names will be kept anonymous and only subscribers’ initials will be used unless express written permission has been granted to the contrary. All Contents © 2006, Rick Ackerman. All Rights Reserved. www.rickackerman.com
-- Posted Wednesday, 26 July 2006 | Digg This Article | Source: GoldSeek.com
