Here's an easy stock selecting tip staring at investors right from the headlines. Identify a company that manufactures a real product, preferably an expensive one, and then turns around and sells that same product to customers eager and loaded to buy it. I agree, but in the current economic environment, these things are easier said... Read more
|
Family-tips.info Relationships24.info Webmasters-xxl.com Beautystar.info Travel-tips.biz |
||||||||
The reality of an economic slowdown in the United States and globally took a step forward on Tuesday after the International Monetary Fund (IMF) suggested that the credit crisis that is spreading worldwide continues to be a major threat to economic growth.
The Federal Reserve has poured tens of billions of dollars into the fragile financial system along with concerted efforts from other global banks, but the impact appears to be minimal, as the economies continue to show signs of slowing. In the United States, the credit crisis has already taken out The Bear Stearns Companies, Inc. (NYSE/BSC), but, as I have said in previous commentaries, it could get worse before the financial situation improves. The IMF said that the U.S. mortgage and credit crises could result in about a staggering $1.0 trillion in financial losses. Recent bad news from key financial institutions should raise red flags. These include UBS AG (NYSE/UBS) announcing a dismal first-quarter net loss of $12.0 billion and the need to retain another $15.0 billion in new capital. Foreign banks are vulnerable to the U.S. credit crisis. The bad news may sound endless, but the reality is the real threat the credit crisis is to the economy. Add in the high oil prices and you have a precarious situation. My view is to wait out the current turmoil and watch for things to improve in the financial sector before jumping back in. The inherent sector risk remains high and makes investments in financial companies vulnerable to higher downside risk. In my view, it could get worse, as the extent of the financial impact of loans and mortgages may yet to be uncovered. This uncertainty makes financial stocks a very risky bet at this time. Some may view bank stocks as a dividend play at this time, but the truth is that the downside risk remains significant and an unnecessary risk to take.
The bank crisis... the banks will get over it. Remember the bad loans to the tech industry, third-world countries, and the Resolution Trust fiasco of the 1980s? The banks always recover. So does Wall Street.
The housing marke... So, in August of 2007, it became painfully clear that the U.S. subprime mortgage sector was nearing a complete collapse, being tied to the underhanded U.S. housing loans, to say the least. What started as a small brush fire in a... Driving is quickly becoming a luxury and not a necessity, as the average price of gasoline in the U.S. is at $3.33 per gallon as of April 8, up $0.53 per gallon compared to the same time in 2007. If you live in California, you a... It's still a very difficult market out there for equity investors. The broader market's been rallying just a little, but with earnings season upon us, all bets will be off.
From the Street's perspective, the market isn't expe... Every major American newspaper and business magazine I saw last month carried at least one major article reporting that the U.S. economy was in a freefall with no end in sight. The worst might have been the last issue of "Busine... Ever since the early 1900's, credit has been an important part of consumer culture. To afford necessary items such as a house or car, consumers must buy on credit. This may pose a problem to consumers who don't have a perfect cr...
|
|
