Discount Designer Stores Rule in a Recession!

by Natalie Pace.

Ross, Marshall’s, T.J. Max, Target and more are included in a Discount Retail Stock Report Card.

Well, if you haven’t noticed yet, unemployment in the U.S. has increased, gas prices have doubled, home equity is shrinking and stock prices are down on the year. The Bureau of Economic Growth tells us that, technically, this is not a recession (yet) because we had an anemically positive reading of .9% GDP growth in the 2^nd quarter of 2008. However, everyone I know is feeling the pinch, and that tends to make penny pinchers of all of us – including the fashion plates, which is great news for one industry in particular – discount designer retail. Take a look at what Ross Stores did in the 2000-2002 recession (below).

Ross Stores Share Price, January 2000 to January 2003

With 150% gains ($100,000 invested becomes a quarter of a million dollars) from January 3, 2000 to January 2003, Ross Stores was one of the shooting stars over that period. The company’s returns were so remarkable that the general marketplace looks like a flat line in the above chart. In actuality, however, the general marketplace over the same period posted losses of -25% to -75% in the Dow Jones Industrial Average and NASDAQ indices, respectively. (See chart below.)

DJIA, NASDAQ and S&P500 performance, January 2000 to January 2003

Was that the case with all discount designer shops? Did Target (le Target to hip bargain hunters who swear by it’s quality wares) fare as well? As you can see in the chart (below) of Target’s share price over the same three year period, if you thought that doubling your money was as easy as picking the most popular discount designer shop, you would have lost 20%. Not all discount designer stores benefit from the constrained wallet.

Target’s Share Price from January 2000 to January 2003

Wal-Mart’s share prices went south as well – down over 20% over the same 3-year period.

Wal-Mart’s Share Price, January 2000 to January 2003

Jabba the Hutt versus the Hare:
So, how can you pick the companies that are going to skyrocket versus those that will lumber along (or lose ground)? One rule of thumb is girth. Monster companies don’t run up as fast as small companies, as a general rule, for much the same reason that Jabba the Hutt wouldn’t beat Kobe Bryant to the basket. Wal-Mart is one of the largest corporations on Wall Street, with a market capitalization of $288 billion, whereas Ross Stores has a lean valuation of just under $5 billion. (See the Stock Report Card for the market capitalizations of Ross, TJ Maxx, Wal-Mart, Target, Costco, Sears, Big Lots and JC Penney.)

As Paul Woods, CEO and president, Odyssey Advisors, is quick to note, "Companies with the smallest market capitalizations produce the highest returns. As companies get bigger, returns go down until you get to the blue chips, which produce the lowest returns of all." Size does matter on Wall Street, but that isn’t all of the story. (And by the way, those big girth companies provide stability. They aren’t as risky or vulnerable as the small caps.)

One of the most important considerations in my view is earnings growth. You can see this quarter’s sales easily on your favorite financial stock page (typically under the Financial Results link), usually lined up next to the same quarter last year. So, using this tool, it’s relatively easy to see if sales are picking up or are declining year over year.

Oftentimes, you can see the trends firsthand in the store as well! In fact, I had an "ah hah!" moment at Ross Stores last week, when I noticed that there were quite a lot of people in there on a weekday morning. In fact, it seemed much busier than I remembered it being over the last few years. When I check the earnings reports, sure enough sales are up this year over last. See below for the earnings trends of Ross and other stores.

Sales increases (or declines) in the most recent quarter, compared to sales one year ago

Source: MoneyCentral.msn.com

Costco is really picking up steam, but that popularity has not been lost on investors. Costco’s price to earnings ratio is 24 – much higher than most companies in the stock report card (which means that the shares are no bargain).

But, what about TJ Max (which also owns Marshall’s)? Could that company be a winner as well? Well, if history repeats itself, TJ Max could do quite well in the coming years. TJ Max earned 90 cents on every dollar invested in January 2000, between that time and January 2003. As money managers are quick to point out, past results are never a guarantee of future results, but it doesn’t hurt to notice the trends that play on Wall Street.

Smaller companies, like TJ Max and Ross Stores, with rich earnings growth tend to outperform larger companies, like Target and Wal-Mart, under similar circumstances. And during challenging times, investors and customers alike flock to the best deals and opportunities, like getting designer labels at off-brand prices. Luxury clothing and accessories will suffer, but bargain clothing is a basic need, even in hard times. With gas prices so high, some of us may choose to ride a bike to work instead of driving, but no one is going to show up naked!

Now, you’ve probably had your eyes stuck on the sales sinkhole at Sears, especially if you’ve recently had an experience at the legacy retailer that was less than desirable. According to an earnings report released on May 28, 2008, in the first quarter of 2008, Sears Domestic's comparable store sales declined 9.8% while Kmart's comparable store sales declined 7.1%. (Sears Holding Company owns Kmart also.) Total domestic comparable store sales declined 8.6%.

Sears is one of the largest, oldest retail chains in the U.S, and formerly, was as American as baseball and apple pie. These days, however, Sears is more of a hedge fund, which might help to explain why you’ve been trying to get that appliance repaired (under warranty) for months or been waiting for a replacement for your coffee pot for so long that you’ve taken up drinking tea. Almost all of the board directors at Sears are in the investment business, not the retail business. Edward Lampert, Sears Chairman, has his own investment fund. The COO of Lampert’s investment company, William C. Crowley, is one of the eight-member board, as is a senior advisor to TPG Capital (formerly Texas Pacific Group investment corporation). (Can you spell cronyism?) In fact, board director Emily Scott, a TV station founder, is the only person on the board without significant investment experience. No one on the Sears board has any experience at all in retail.

Additionally, Sears, like Lowe’s and Home Depot, suffers from having a lot of home improvement merchandise. As Mike Ullman, CEO of JC Penney, said, "It’s hard to sell window coverings to homes that aren’t being built."

As I’ve noted in years past, the summer doldrums are not my favorite season for buying stocks because in up years, there’s not much momentum lost from waiting and in down years, those summer months tend to be challenging.

As a result, I’ve added Ross Stores and TJ Max to the Watch list this month, and placed Sears on the Cooling Off list. I’ll keep an eye on Ross and TJ Max between now and October 1, 2008, with an eye to adding it to the Hot News list when the share price looks more attractive.

Remember, if you’re interested in a put option on Sears, be sure to give yourself ample time to be right. Experienced executives can find creative ways to prevent bad news from hitting the headlines and/or earnings reports in the near term, even if the focus, challenges and team seem to add up to a decline ultimately. Additionally, since Sears is run by hedge fun managers, sales could suck, and earnings could still be strong, based upon investment performance (rather than retail prowess).

Please note: NataliePace.com does not act or operate like a broker. We are a news media website. This article is intended to educate and inform individual investors, and, thus, to give investors a competitive edge in their personal decision-making. The publicly traded companies mentioned in this article are not intended to be buy or sell recommendations. ALWAYS do your research and consult an experienced, reputable financial professional before buying or selling any security, and consider your long-term goals and strategies.

Investors should NOT be using the Hot News on Cool Stocks list or the Cooling Off list to trade their nest eggs. Your retirement plan should reflect a long, safe strategy, which has been designed with the assistance of a financial professional who is familiar with your goals, risk tolerance, tax needs and more. The "trading" portion of your portfolio should be a very small part of your investment strategy, and the amount of money you invest into individual companies should never be greater than your experience, wisdom, knowledge and patience.

IMPORTANT DISCLAIMER: Information has been obtained from sources believed to be reliable however NataliePace.com does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.

Never Pay Retail: the ABCs, P/Es and GDPs of Buying Low and Selling High.

by Natalie Pace

Photo by: Stacie Isabella Turk, Ribbonhead.com ©2008. Stylist: Arlene Hylton-Campbel, 818-710-0079.

Everyone knows the mantra, "Never pay retail," but it’s a lot easier to apply that to shoes and ties than it is to stocks. You may feel completely flabbergasted with numbers and that you’ll never understand the stock market enough to determine whether it’s poised to go up or down. You might have taken a painful hit with Internet stocks between 2000-2002 and fear jumping in to experience a sequel. And yes, there are some periods when the stock market (or the real estate market or the bond market) is simply overvalued (too expensive) to go all in at once. But, trust me, you can really do this.

Since the U.S. stock market has that beautiful historic return of 11.4 percent every year for the past 25 years, as of April 30 2008 (source: Hulbert’s Financial Digest), if you are stuck with something that has gone out of style, you can just store your stocks (in your long-term portfolio) in the back of the closet without "wearing" them. Just like shoes, chances are that in a few years, what you’re storing will be all the rage again, and you’ll be glad that you didn’t junk them (this holds true with bonds and real estate, as well). Quality products and services hold up over time and increase in value—provided you didn’t pay an outlandish price to begin with for them. And if you are keeping a percent equal to your age safe, and are diversifying your assets, you’ve really got an investment insurance plan, with very little trouble at all.

Some people think that having an understanding of Average Price-to-Earnings ratio for the general marketplace can be very helpful, but when you’re just starting out, this data can actually be more confusing because there is not a clear correlation between low P/Es and bull years (when the stock market goes up) and high P/Es to bear years (when the stock market goes down). In 2007, the average P/Es were low and expected to go even lower (which should spark a good run-up in share prices), but the subprime crisis poured water on the fire, and the markets ended the year essentially flat. On the other hand, even if you didn’t know the first thing about average P/E, it didn’t take a rocket scientist to sniff out the trouble with Nasdaq in 1999 and 2000, or the subprime mortgage crisis in 2006-2007.

In 2000, the People’s Webby Award for best community was slashdot.org (over CraigsList). Gomez.com won the Webby for best financial services site, over the People’s choice PayPal. Swoon.com competed with Martha Stewart.com for the Webby in the best living category. Sputnik7.com lost to Napster.com in music. Ever hear of half of these? And the one thing all of these sites had in common was that not one was making a penny. The Nasdaq run-up was all based on the fanciful notion that the companies of the New Economy didn’t need to make money, and the hyped-up propaganda that if investors didn’t buy in immediately, they’d never have another opportunity. Sound familiar?

Subprime borrowers – and for the most part, these were real estate speculators, not families -- unknowingly bought real estate at the highs in 2005 and 2006. They originally bought in and hoped to flip for a profit before the balloon payment became due, but ended up having to foreclose as early as 2007 when interest rates jumped and their teaser rates expired. Why did they buy in? Feverish demand was fueled by cheap, easy money. It was a very loose lending environment, and many investors believed (as they were told on TV and in seminars) that they would get rich quick. Vulnerable investors over-extended themselves because they were sold on the idea, by commission-based mortgage brokers, that the annual real estate gains would continue to soar, as they had between 2000 and 2005.

The reality was that real estate prices were out of affordability range in many markets in the U.S. beginning as early as 2005. In fact, without all of the fancy math tricks being done by aggressive mortgage lenders, far fewer buyers would have qualified to purchase at all.

So, if it feels like you are paying a steep price for swampland, just so that you don’t miss the chance to own real estate and the gains that everyone is bragging about, chances are you are experiencing a bubble that is near to popping. Same thing if you’re buying an Internet stock that no one has ever heard of, which has been losing money for five years. No math skills needed. Just an extra large dose of common sense.

People who race to catch trends are chasing money. The same people who bought real estate on credit cards between 2002 and 2006 were buying stocks at the high in March of 2000. You don’t want to be dragging your nest egg on these wild goose chases! If you’re trading on headlines, you’re already too late!

Again, you won’t have to worry so much about what the price of the general marketplace is this year when you are taking a 20—or 30-year view, and are contributing monthly to your stock portfolio. Because you are contributing the same amount each month, you are constantly participating in new price points, rounding out the buy-in price, and purchasing new holdings at the lower price (a very good thing). Tithing regularly and having a long-term strategy are the foundation of living the life of your dreams.

Of course, in your "buy low; sell high" Stocks on Steroids trading portfolio—that small percent of your nest egg where you take on higher risk for potentially higher gain—employing the average P/E of the general marketplace and the P/E of the company is critical.

Average Price-Earnings Ratio
P/E varies by industry, but as a general rule, the lower the number the better. Attractive average P/E values for the general marketplace are under 15. Average P/E values for the overall market are mid-range when they are at 18 and expensive at 20 or above.

The average P/E ratio of S&P Composite stocks was 20.3 in September 1987, before "Black Monday," when the Dow Jones Industrial Average dropped 508 points, an alarming 22 percent. The average P/E was 30.50 in December of 1999, just months before the 2000-2002 recession kicked in. By comparison, the average P/E in the first quarter of 2007 was 17.

Now, I’m almost reluctant to give you these guideline numbers because price to earnings ratio is something that you’re not going to understand really until you have had years of experience in the stock markets, and have lived through a recession. Why? Because price to earnings ratio has two factors that affect the number. When earnings are poised to explode, then you can have a high price to earnings ratio that is actually a low price for the stock (because as the earnings side of the equation increases, the P/E ratio goes down). Thus, you have to be aware of current price and forward earnings potential, in order to have an accurate picture of whether or not you’re going to make money on your investment.

Gross Domestic Product (GDP) Growth
In late 2002, the average P/E in the S&P 500 was 32—very high; however, earnings were coming back and Gross Domestic Product growth was increasing. Thus, stock prices in the fourth quarter of 2002 were at the tipping point. What felt like the end of the world was actually the end of the bear market—the best buy-in point of a rally that kicked it up in 2003 and continued through late 2007. After October 2002, P/Es began to decline (a good thing), largely because of the increase in the earnings side of the equation. NASDAQ gained 45 percent in 2003.

In other words GDP growth and earnings growth (or decline) will dramatically affect what happens to P/E, and those measurements are far more important to know when you are considering whether or not the stock prices are going to increase or decrease in value going forward. Stock prices have a high correlation with following earnings trends. When earnings increase, people get excited and buy and the share price increases. When earnings go down, people freak out, sell, and the price goes down. Thus, GDP growth measurements for the general marketplace, which dramatically effect earnings trends of the company, make a better crystal ball than what the average P/E for the general marketplace is.

How to Use Average P/E
If the average P/Es get above 20 again, be cautious about what you buy, unless the economy is poised for a boom as 20 average P/E means that investors are paying 20 or more times earnings on average for every stock—even those with little or no growth potential. You don’t want to pay 20 times earnings for companies that only have an annual growth of 5 percent or less. It’s overpriced and reckless. (Remember that there is still more to consider, which is why I say "be cautious" rather than don’t do it.)

Now in July of 2007, the average P/E was 16. Companies still had excess cash reserves, with the industrials having over $600 billion, which was 6 percent of market value and a comfortable 40 percent of their long-term debt. Those who were worried about the weak U.S. dollar weren’t considering that many of the publicly traded companies were by then operating in the global marketplace, and were not over-reliant on the U.S. dollar as the only currency. Earnings had been outstanding, with double-digit operating growth for 18 consecutive quarters, according to Standard and Poor’s Senior Index Analyst, Howard Silverblatt. As a result, stocks performed very well, through October of 2007, before the subprime mortgage crisis ground the economy to a standstill. (GDP growth for the fourth quarter of 2007 was 0.6 percent GDP growth, down from 4 percent growth in the third quarter, according to the Bureau of Economic Analysis.)

Even before the BEA report was released in January of 2008, there were a lot of economists and policymakers who were using the R word—recession—predicting a dramatic slowing of growth, moderated earnings, less capital expenditures from business and lower consumer spending. When GDP growth stalls, stock prices decline. In that scenario, liquidity is very important (freeing up some cash by selling some stock before the down cycle), so that you can pick up holdings on your Stock Shopping List for lower prices later on in the recession cycle. In the buy low; sell high scenario, based upon the forecast of continued decline in GDP growth, January 2008 might well be the high point of that year, just as March 2000 was the high of that election year.

To find out the current average GDP growth statistics, go to the U.S. Bureau of Economic Analysis, at BEA.gov, which provides quarterly statistics on Gross Domestic Product and Gross National Product growth.

Earnings Growth in Individual Companies
When the general marketplace is poised to do well, you don’t have to be as nervous about buying individual growth companies, like Google, at a high P/E. Google’s top line revenue rocketed up in the second quarter of 2007 a robust 58 percent. The earnings side of the P/E was moving even faster than investors were buying in. If you bought at the 52-week low of $400, when the P/E was about 50, you would have done great later on in the year when Google traded for above $740 per share.

As another case in point, you would have done great in 1987—the year of Black Monday—if you bought another growth stock, Microsoft, at a 20 P/E. (Microsoft’s IPO was in 1986). You would not have done so well with buying Ford (a large Blue Chip stock) at that time. As an old legacy company with limited annual growth, Ford would have to have a considerably lower P/E – or be trading for a song -- to make it a worthy selection.

So, how can you tell when a company is experiencing rapid growth in the earnings side of the P/E equation? The simplest way is to check the "Financials" page of the stock on your favorite financial website. Many line up the revenue by quarter and year, so it’s very easy to see which number is bigger (or smaller) and by how much. Sales that are rapidly increasing are a very good sign. Declining sales are a red flag. In the earnings reports, the companies, typically, even do the math for you, letting you know the percentage of gains (or losses) by quarter and by year, often with an explanation from the CEO as to why. Be sure to check both sales and income (how much the company is making after expenses), since the company is going to emphasize the one that looks the best in the earnings press release.

Google’s revenue growth went from just under a billion in 2003, to $6 billion by year-end 2005, and racked up more than $15 billion in sales in 2007. Opsware’s revenue growth went from $61 million in 2006 to $101.7 million in fiscal year 2007, and is on track to continue growing apace, with Cisco and Hewlett-Packard distributing their software. (Hewlett-Packard owns the company now.) Both companies had incredible growth, and I found that information by using two clicks on my favorite financial website.

Next month, I’ll reveal to you more secrets about why price to earnings ratio is so tricky, and how to really evaluate whether or not a company is ripe to buy or sell.

Shopping for a Promotion – Literally.

by Natalie Pace

Every promotion and raise I ever got hinged on one critical heel—dressing the part. Have you ever heard of anyone in a t-shirt and thongs (the shoes, not the underwear) getting an executive level position (unless they owned the company)? How would you feel if your attorney showed up to court in a Hawaiian shirt? Every job has its standard dress code, and dressing for success is a subtle, but important statement that you walk the walk and talk the talk of the promotion you’re aiming to get. And that message has to start BEFORE you ask for the job, not after. Unfortunately, you can’t afford to rationalize that you’ll buy the new suit AFTER you get the job and have the extra money to afford it. If you don’t invest in the duds first, your big shot will mostly likely be a blank.

The reason that I say to start walking the talk now, is that it’s not just in the boss’ office where that suit can be an advantage. Great-looking clothes (and unfortunately fabric DOES matter) can provide a conversation starter for strangers. At a conference last year, I met one of my business advisors because he and I were both standing in the valet queue, waiting for our respective cars, wearing similar (and I think quite tasteful) pin-stripe suits, which were coincidentally made by the same designer. That silly clothes moment has resulted in a business relationship and Rolodex sharing that has the potential to add millions to the bottom line of my company. That’s a million dollar return on a thousand dollar investment. (It was a really great designer suit—which I bought on sale!)

Still afraid to pony up the dough before you win the job? Worried about how you’ll pay off the credit card bill? Unfortunately, it’s a Catch 22 situation. If you don’t make the investment, you’re unlikely to get the promotion. Which strategy is more likely to succeed? Walking into your boss’ office wearing the corporate clerk smock or having the boss walk by your office and see you looking sharp and sassy, like you’re ready to go sit at that vacant corner office upstairs? One entrance reeks of pleading, while the other sizzles of respectability and upward mobility. Your new clothes and confidence hint to your superior that if he or she doesn’t come up with some added incentive and responsibility for you, you might start looking around for an employer who will. (And if you need to pay that credit card off, you’re really going to start looking if they don’t give you what you deserve!)

Fear is what keeps most people frozen in their tracks, while entrepreneurs are well known as risk-takers. You have to take a serious moment with yourself about just how much you’re willing to invest in climbing the corporate ladder. If you’re unwilling to set aside money for more education in your field and an appropriate wardrobe, you shouldn’t complain about the rung you’re stuck on! Climbing the corporate ladder has no bearing on what kind of person you are anyway. If you’re happy in your job, by all means, keep the clothes and position you have! Great people are judged by their actions and how they beautify our world, not their rolodex or annual income. But if a promotion is what you desire, that, like all upward mobility in life, is going to require an investment in time and money.

Last week, I came across an executive assistant wearing a tailored suit. The first thing I thought was, "If her work ethic, her education and her intelligence warrant a raise and promotion, I wouldn’t be surprised to see her in her own office next time I visit." (And if her education and industry acumen don’t measure up, then her next shopping spree should be for college classes and/or professional development!) I put her name on my short list of people I would approach when my company was hiring again.

Finally, get the most for your buck. Summer can be a great time for off-season designer sales! Splurging (within reason) can be the best thing you do for your career, and paying a little more for a great fabric and a great cut can pay off for years because classic cuts don’t go out of fashion, like the latest trend does. Polyesters, off-the-rack suits and outrageous fashion statements may cost less, but they look also look cheaper and wear out in just one season. Whereas a great suit can become this year’s hip, new look with a new blouse, a new hem line and some accessories!

Live Like a King. This Father’s Day, Why Not Spoil Him?

by Natalie Pace.

Gift ideas for the guy who has everything and the woman whose appreciation and love exceeds her budget.

Lakers and Celtics’ playoff tickets may not be in your budget, but is there a way to make your special man feel like he’s courtside this month? Check out our survey results and online shopping mall for gift ideas (instead of buying the dreaded annual tie). Most of the time, massage and pampering ranks number one with guys as what they really want for Father’s Day, so if your imagination is bigger than your budget, you might actually dream up and create a once-in-a lifetime evening he’ll rave about forever.

Below are some unique opportunities for that special guy who has everything (and that special gal who has ample resources to give him something extraordinary).

1. Original Artwork:
"BeBop." By Michel Tabori. Tabori is one of the hottest artists in Venice, California. His exhibitions all sell out, and his artwork has provided an attractive return on investment, in addition to aesthetic value, for owners. For years, Tabori’s signature painting, BeBop, energized the ambience at Hal’s Bar, and it is now available for private ownership. Some lucky guy or gal will own it. Why not you? Contact William Turner at 310.453.0909 or WilliamTurnerGallery.com if you are interested and can afford to invest $110,000 on great art. Be sure to tell him that NataliePace.com sent you!

Michel Tabori’s "Be Bop" at Hal’s Bar, in Venice, California

2. NBA Finals tickets: Boston Celtics versus LA Lakers.
The rivalry is back and so is one of the most exciting players basketball has ever seen. This could be an historic year for Kobe Bryant, if he wins MVP of the season, MVP of the finals and then a gold medal at the Olympics. That puts Kobe ever closer to the legacy of Michael Jordan! There are hundreds of season ticket holders that are willing to sell their seats on Ticketmaster’s Exchange program (where you are reasonably assured not to be scammed or scalped). Tickets start at just under $400 per seat and go up to thousands per seat for courtside. Whether you want to attend a Boston or Los Angeles game, this seat exchange program is likely to be safer than taking your chances on eBay (where there are also hundreds of tickets for sale, ranging in price from $600 to thousands of dollars).

3. Fast Cars and Money
Get Rich and Enrich Investing Retreat with Natalie Pace. Early bird pricing now through Father’s Day only!
If your guy is into stocks, why not get him a free ticket to wealth? Register him now for the NataliePace.com Get Rich and EnRich Retreat in September (Sept. 23-25). You can join us or lie on the beach while he learns how to invest like Natalie Pace, Warren Buffett and Peter Lynch. Even better, the alternative car show will be in Santa Monica September 26-27, so it can be five days of guy paradise – rocket ship returns and fast cars! The early bird price of the retreat is just $995, and is available now through Father’s Day (June 15^th, 2008) only. Only ten lucky individuals can attend this intimate, intense, life transforming investment training session which is led by Natalie Pace herself, so be sure to call 866.476.7442 right away to book your special guy’s spot. Special discount price of just $1500 for both of you, if you choose to join him (and pay by Father’s Day).

4. Gold
Gold is no bargain these days at $886 on the 31^st of May, 2008, so think twice before buying a beautiful Chinese Panda Yuan or American Gold Eagle or Canadian Gold Maple Leaf, ranging in prices from $1610, $990 and $933 respectively. It’s great fun to buy these coins at under $400 (the price in 2002) and then sell them for a thousand, but buying coins at a thousand and hoping to sell them higher is risky, even in today’s tumultuous economy.

If your guy has gold fever and you don’t own your own mine or money tree, you might want to consider buying him some gold mining stock. Newmont Mining (NEM), Goldcorp (GG), Rio Tinto (RTP) are all trading at 10-year highs. On the other hand, U.S. Gold (UXG), a gold exploration company that was founded by the former Chairman and CEO of Goldcorp Rob McEwen, is still trading at all-time lows at $2.16/share on May 29, 2008, largely because exploration had to be stopped during the snowy Nevada winter. This is a very high-risk stock, so read up on it in the Hot News on Cool Stocks list in this ezine before investing. However, if Mr. McEwen strikes his gold mine, you’ll have given the best gift ever to your special guy! (Yes, this high-risk investment will either strike it rich or make excellent wallpaper!)

5. What’s Your Favorite Father’s Day Story?
Share your best Father’s Day gift, story or occasion with us on the Sharing Wisdom bulletin board. We’ll feature the most inspiring story and/or gift idea in the 2009 NataliePace.com Father’s Day June ezine.

Disclaimer: Natalie Pace owns shares of U.S. Gold and artwork by Michel Tabori.

My Father. My First Man Angel.

by Dr. Marjorie Wolter.

Yes, Incredible men do exist!

Dr. Marjorie Wolter with her father on her wedding day

My father began his "fathering" career in the footsteps of his own papa. Discipline ruled. Spare the rod and spoil the child. As time passed, he came into his own gentler parenting style. There remained a sense that releasing old discipline techniques was a betrayal of previous generations. He cruised along though, willing to make mistakes, challenging himself to grow and create openness where staid tension had lived.

Perpetual discovery was his greatest gift to me, and the reason we were able to heal our wounds through so many parent to child mishaps. He came to trust that it was o.k. for me to work and be a mom. The day he talked to me about having someone in marriage as an equal, I was driving and almost went off the road. Was I in the twilight zone? Nope, it was my dad’s zone. From a generation that didn’t believe in talking about family skeletons, he actually made an appointment with a psychologist to straighten out the tangled dynamic of our mom/dad/daughter soap opera.

While he wasn’t perfect, he never ceased to stay in the race, the endeavor of life. Everyone starts this race, but few pour it on until the end. My dad, in his own way, qualified as an Olympic marathoner by continually seeking new vistas. None of us are perfect. Our best shot is to let imperfections be known, valiantly attempting to learn and grow beyond their blight. Dad was an emblem of endurance and hope.

One week before a quadruple bypass, he informed me of the diagnosis sitting face to face. His fear generated a current throughout the room. Of gravest concern: leaving a son not yet out of high school. Was history repeating itself? Misty eyes turned into shudders. Dad was acutely aware of the pain death could bring to those left behind having experienced the loss of a brother and his own father before finishing college. A second brother died taking over the reigns of the family business. Remaining brother "Fred the Younger’s" plane was shot down during World War II and he was presumed dead for six weeks. Mercifully, Fred showed up at a field hospital sparing my pop from attending yet another funeral. Though these memories resurrected the specter of death, my dad made it successfully through his surgery. I was twenty, and in fact, this was the magic number for we were able to share twenty more years together.

A realtor by profession, my father’s schedule was self-directed. There was always time for favored activities including clipping coupons, grocery shopping, staying involved with various clubs, hunting, and fishing. Charles was Teddy Roosevelt reincarnated when it came to being an outdoorsman. But, did Teddy clip coupons? Did Teddy tell silly jokes and dance little jigs around the house? Winston Churchill was one of his favorite historical figures. One of Winnie’s quotes was also a favorite. "Nothing but the best and the best is none to good." Dad would joke.

It was only as an adult, living away from home, that I realized what a character my father was. He truly had created his own path, for better or worse. There were aspects of his personality befitting a man born in the early 1900s and others that didn’t even begin to fit a man in 2000. I had been secretly spoiled, raised by a father who broke the mold. He could be very masculine and nurturing as well. He was sometimes pig-headed and simultaneously the glue that held our family together. Ego had its place, yet he spilled worrywart thoughts freely. Sometimes biases regarding race or gender would surface, although, every interaction I witnessed was handled with respect. His personal commentary on telemarketers: "They need to make a living too."

After decades of marriage, he remained loyal and protective of my mother. You could bank on his expression, "I love your mother more today than the day I married her."

By the time I hit forty, he achieved a "Zen master" countenance. He delighted in each moment, reveled in our weekly lunches at Steak "n:Shake, and told the tales of his childhood. I had a disturbing intuition that coming to know his past signaled the end of our time together. This signal became truth as a stroke claimed the vigor of his final days.

As death drew near, I was sprawled over a chair dreaming at his bedside. My dad and I were walking together down a quiet dirt path. Continuing our stroll, the lane split. Could this dream be more cliché? Even my dream persona was shocked by the literal nature of the unfolding story. The scene did not feel contrived. In fact, it felt expansive and calm. My father had become a sage. He took my hand. Speaking with velvety assurance he said, "You must walk your own road now. I am so proud of who you are to become." He then pulled away, veering toward the left fork. Our bond’s alchemy merged ethers and physical world. Awakening as he drew his last breath, I kissed his forehead to bless the journey. He was such a beautiful man. I loved him so.

My father was an original, a jewel cloaked in an unassuming demeanor. My dad didn’t talk much about the life he wanted. He chose it and lived it every single day. His quiet demeanor wasn’t a lack of strength, he embodied life with little need to brag about it. Having experienced repeated tragic loss; he became a quiet champion of love at all costs.

At 80, he looked to be 60. Amazing liberty had come from facing his greatest fears, shutting out the din of conventional wisdom, and tinkering with life. My father, my first man-gel, allowed me to behold this miracle in witnessing him. He gave me the tools to detect the unique gifts of each amazing man who crosses my path, and honor them through the pages of this book.

Dr. Marjorie Wolter grew up surrounded by amazing men, a gift she forgot until the kind actions of strangers decades later roused slumbering memories. As a dentist, mother, and artist she didn’t fit the typical professional mold. Enter man-gels, men who exhibited qualities of angels and lived beyond any set of limiting rules. They put the myth that a good man is hard to find to rest for good as well as the idea that we are ever stopped by anything other than our own self-doubt. Her book, My Man-gels: The Men Who Erased the Myth is a delightful tribute to these wonderful men and can be ordered at www.mymangels.com.

Your Ships Are Coming In!

by Chellie Campbell, author of Zero to Zillionaire.

Chellie Campbell, Author of Zero to Zillionaire. Photo credit: Mary Ann Halpin

Your ships are coming in. Even when it looks like they are sinking fast.

A few weeks ago, I spoke with a lovely woman who is interested in becoming one of my Certified Dolphin Coaches. She wanted to know if I took American Express. I didn’t, but I said I thought I could sign up pretty quickly and that it was about time I did that. So I called Nova, my Merchant processing company and got the ball rolling. Marica at Nova was delightful and said my next  step was to call and sign up with American Express.

At American Express, again, I got a happy, upbeat customer service representative. As we were chatting, I mentioned that I taught Financial Stress Reduction® Workshops and am the author of Zero to Zillionaire. The agent at American Express told me her mother just bought my book!  What a lovely surprise!

 I was quite tickled with that of course, and in my next email correspondence with Marica at Nova, I mentioned that happy synchronicity.

Marica wrote back:

 "Well even funnier.  I just heard about the book this weekend!!!"

Providence is working on your behalf when you don’t even know it. Under the radar, the word is spreading about you and your work. Believe that all is well, and all your ships - that you thought were sunk - are still alive and well. They are just waiting in the Karma Harbor for the right moment to sail on home.

Life is amazing. And rich! And wonderful!  

May all your ships sail in today—easily and effortlessly—laden with treasures!

Love and blessings,
Chellie

So you think you can write? Chellie Campbell has written two books that have gone on to become bestsellers, The Wealthy Spirit and Zero to Zillionaire. Learn the real deal about getting your book published and what kind of $$ it can add to the bottom line of your business. If you’ve ever wanted to be a bestselling author and want the inside track about how to accomplish that, join Chellie in an intimate online chat to discover how she got her first book deal, went on to become a bestselling author and translated all of that into her own lucrative financial stress reduction seminar series.

Chat with best-selling author Chellie Campbell in the NataliePace.com chat room
Wednesday, June 25th, 2008
8:45AM through 9:30AM
Must be an active subscriber to participate

Chellie has also been responsible for helping countless people to increase the profitability of their businesses. If you are stuck having too much month at the end of your money, learn Chellie’s time-proven strategies to success in our chat room.

As a professional speaker and author of The Wealthy Spirit and Zero to Zillionaire, Chellie has been teaching Financial Stress Reduction® Workshops since 1990. The Wealthy Spirit was a book-of-the-week on the Doctor Laura Schlessinger radio show and a GlobalNet book-of-the-month selection. She has been quoted in Good Housekeeping, Lifetime, Woman's World, and Essence, and more than 30 popular books.

Invest, Involve and Inspire with the Step Up Women’s Network..

by Natalie Pace.

Nationwide women’s network provides mentoring, educational enrichment and scholarships to girls trapped in the harshest conditions of the inner cities of Chicago, Los Angeles and New York.

Lashane, winner of the 2008 Step Up Scholarship Award   Step Up Teen Participants Photo Credit: Maya Myers   Jamie Lee Curtis talking with Shalisa Photo Credit: Maya Myers   Jamie Lee Curtis, Jennifer Love Hewitt and Julieta Photo Credit: Maya Myers

Imagine a world where underserved girls are mentored, provided college scholarships and given Goddess Days of yoga, dance and vision board making, and you have entered the creation of Step Up Women’s Network founder, Kaye Popofsky Kramer. In the summer of 1998, Kaye started Step Up with 30 close friends, who had come to support Kaye during her mother’s battle with breast cancer. Little did they know that ten years later the organization would be hosting a gala lunch at the Beverly Wilshire Hotel and raising $350,000 to provide teen empowerment programs for underserved girls, women's health education and advocacy, professional mentorship and social networking opportunities. The May 9, 2008 Inspiration Awards gala lunch was supported by CBS, Lifetime Networks, Sony Pictures Entertainment (among other corporations), was hosted by Jessica Alba and Molly Sims (among other beautiful VIP women) and honored Jennifer Love Hewitt, Andrea Wong and Dove (for their self-esteem fund). But the standing ovation of the afternoon went to the winner of the Step Up College Scholarship, Lashanae Thomas. Lashanae read her winning scholarship essay, which told an intimate, emotional story about facing some of the worst circumstances the inner city can slap upon a young woman and how her Step Up mentor and the organization gave her the confidence, educational enrichment and scholarship to clean up her attitude, finish high school with straight A’s and enroll at the University at California at Riverside. "Invest, Involve and Inspire" is Step Up’s motto. While the Los Angeles office has modest headquarters in the downtown district, their reach is eye-popping impressive. Step Up’s partnership with Merck on Gardasil (the cervical cancer vaccine) helped to make the "Make the Connection" ad campaign one of the biggest product launches of 2006. Jessica Alba brought two high school girls, who receive mentoring and enrichment from Step Up mentors, on the Tyra Banks show. And the latest Step Up partnership features Nina Garcia of Project Runway, who calls upon aspiring designers to create a fashionable birth control pack. The winning designer will be awarded $10,000 to jumpstart her career. If you are interested in being that designer, get more info at SUWN.org. Step Up's "When I am President" photography program in Chicago teaches young girls basic photography skills and encourages them to express their ideas, ambitions and opinions through their art. Step Up’s college tours takes the girls to the premiere universities and inspires them to believe that they too can attend Stanford, UCLA and the University of Southern California. Landmark Theatres in Los Angeles will be screening the compelling and captivating short films of Step Up On Stage Project participants on June 12, 2008. (Get more information at the calendar section at NataliePace.com.) Step Up is not just about a weekend field trips and afterschool photography, however. Girls who are living in gang neighborhoods, in challenging conditions, and sometimes without positive peer or parental support, are paired with a Step Up mentor to help her navigate her circumstances, dream of a better life and design the pathway to get there. Step Up mentors commit to serving their mentees for a minimum of six months and to attend monthly workshops with them. The results are life transforming, awe-inspiring and, yes, something to get choked up about, even as the pride of knowing you are part of the solution warms your heart. Step Up’s featured Student of the Month, Deliza Padilla, would love to be a motivational speaker one day and even run a Step Up class—"it would be titled Non-negativity," she jokes. Deliza believes it is possible to take charge of your own destiny as a young woman, no matter what you are faced with. "You just have to step out of your comfort zone... and for that you need to have confidence in yourself," she says. Sometimes you step out of your comfort zone, and sometimes you are tossed out. When Kaye Popofsky Kramer’s mother was diagnosed with breast cancer, she was undoubtedly looking for her own support. That unfortunate circumstance brought together a group of women who have transformed the lives of millions of young women, and with your support the best ten years lie ahead. If you want to be inspired, invested and involved and if you want to ensure that other young women have the opportunities, information, education and support they deserve, join, volunteer or donate to the Step Up Women’s Network at SUWN.org.

"Wrong Numbers" and Stock Tips on Your Answering Machine.

by the U.S. Securities and Exchange Commission.

You come home after a long, honest day's work, stroll by your message machine, and see the light blinking. Did a loved one call with good news? Is there a friend calling to find out what you're doing tomorrow? Some people are finding that they have instead received a "misdialed" call from a stranger, leaving a "hot" investment tip for a friend. The message is designed to sound as if the speaker didn't realize that he or she was leaving the hot tip on the wrong machine. Maybe the message sounds like this:

"Hey Tracy, it's Debbie. I couldn't find your old number and Tammy says this is the new one. I hope it's the right one. Anyway, remember that hot stock exchange guy that I'm dating? He gave my father that stock tip on the company that went from under a buck to like three bucks in two weeks and you were mad I didn't call you? Well I'm calling you now! This new company is supposed to be like the next really hot clothing thing. And they're making some big news announcement this week. The stock symbol is ... He says buy now. It's at like 50 cents and it's going up to like 5 or 6 bucks this week so get as much as you can. Call me on my cell, I'm still in Orlando. My Dad and I are buying a bunch tomorrow and I already called Kelly and Ron too. Anyway I miss you, give me a call. Bye."

If you get a message like this, it's not a wrong number at all. Instead, it is from someone who is being paid to leave these messages on a whole lot of answering machines. The people paying for this message to go out on hundreds or thousands of answering machines own some of this stock. They are hoping you can be tricked into buying some too, as they stand to gain by selling their shares if the stock price rises because gullible investors buy. Once these fraudsters sell their shares and stop hyping the stock, the price typically falls and investors lose their money. Fraudsters frequently use this ploy with small, thinly traded companies because it's easier to manipulate a stock when there's little or no information available about the company.

These scams have also migrated to email and faxes. Be extremely wary of an email message that starts out like this:

Hey you!

PLEASE don't tell anyone about this email, because if the SEC finds out, I could get in big trouble for passing on this information, maybe even go to jail.

This is super important! I hope I have the right email for you. Your messages keep bouncing back because your mailbox is full, and I seem to remember this is your other account. I tried calling but you're not home .. arghh! OK here's the news ..

And look out for a fax transmission that says, "Will you please put your cell phone on. I have been trying to get you for 2 hours. I have a stock for you that will triple in price just like the last stock I gave you did. I can't get you on either phone. Either call me, or call Linda to place the new trade. We need to buy now. P.S. You better be good to me this Christmas. No other Stock Broker has given you back-to-back wins. Thanks, your shining star Financial Planner."

It is never a good idea to put your hard-earned money into a stock on the basis of a hot tip from somebody you don't know. There are unscrupulous individuals out there who have a financial stake in trying to drive up the price of companies that you've likely never heard of. Many fraudsters rely on Internet chat room sites or spammed investment newsletters to promote companies, but at the SEC we're beginning to hear more and more reports of the phony misdialed number and misdirected email scams.

So what should you do if you get one of these messages? Before you delete the phone message, trash the email, or rip up the fax, we would appreciate hearing details about the stock being hyped. Be sure to tell us the phone number from which the call came (if you're able to tell us), forward the email (including the header information), or send us a copy of the fax. This kind of information is invaluable as we seek to enforce the federal securities laws. You can use our on-line complaint form, at http://www.sec.gov/complaint.shtml, e-mail us at enforcement@sec.gov, send us a fax at 202-772-9295, or you can call us at 1-800-SEC-0330. We welcome your help in ferreting out fraud in securities sales.

After you send us the information, we suggest you delete the phone message or email. Then congratulate yourself for not falling victim to this kind of scam!

Here's a list of red flags that we often find in many of the frauds that we see:
* If it sounds too good to be true, it is. Any investment opportunity that claims that there are huge guaranteed rewards, especially for acting quickly, are incredibly risky, and more likely to lead to losing some, most, or all of your money.

* "Guaranteed returns" aren't. Every investment carries some degree of risk, and the level of risk typically correlates with the return you can expect to receive. Low risk generally means low yields, and high yields typically involve high risk. If your money is perfectly safe, you'll most likely get a low return. High returns represent potential rewards for folks who are willing to take big risks. Most fraudsters spend a lot of time trying to convince investors that extremely high returns are "guaranteed" or "can't miss." Don't believe it.

* Check out the company before you invest. If you've never heard of a company, broker, or adviser, spend some time checking them out before you invest. Most public companies make electronic filings with the SEC. There are computerized databases to check out brokers and advisers (at FINRA.org). Your state securities regulator may have additional information (at NASAA.org). And by the way - if a supposedly upright firm only lists a P.O. box, you'll want to do a lot of work before sending your money!

* If it is that good, it will wait. Scam artists usually try to create a sense of urgency - implying that if you don't act now, you'll miss out on a fabulous opportunity. But savvy investors take time to do their homework before investing. If you're told something is a once-in-a-lifetime, too-good-to-be-true opportunity that "just can't miss," just say "no." Your wallet will thank you.

Listen to one of the "wrong number" voicemails on the sec.gov website.

For more information, please read:
Microcap Stock: A Guide for Investors
Internet Fraud: How to Avoid Internet Investment Scams
Information Matters
Fake Seals and Phony Numbers: How Fraudsters Try to Look Legit

 

Cooling Off With Coke and Pepsi and Other Value Blue Chips.

by Kelley Wright, managing editor, Investment Quality Trends stock newsletter.

INVESTMENT OUTLOOK
First-June 2008

Kelley Wright, Managing Editor, IQTrends.com stock newsletter.

The belief in some circles is the January lows represent the bottom of the financial markets: that Mr. Market has discounted all of the possible outcomes with the banking and housing melt-downs; the breadth and depth of the commodities spike; the decline of the dollar; the fading expectations of recession; ad infinitum. This belief was bolstered when the February retracement of the relief rally failed to put in a lower low.

As the markets rallied from March into April converts to this belief grew on a daily basis until the Dow crossed 13,000 and ran into the brick wall that is the crude oil market. When crude prices vaulted past $120 per barrel the markets eased off the pedal (no pun intended) and retreated into a trading range with Dow 12,600 representing the bottom of the range. When crude passed $130 per barrel, the bottom end of the trading range fell apart like a cheap suit and the Dow declined to the 12,450 range just prior to the long Memorial Day weekend.

When trading commenced again on Tuesday the markets rallied, as is typical after a holiday, on the old stand-by of "favorable economic news," which consisted in part of a decline below $130 per barrel in crude oil. Wednesday morning greeted traders with reports of "unfavorable economic news," which resulted in the 10-year Treasury moving past 4.00%, the auction of 2-year notes garnering 2.62% (the highest since January), and crude oil trading above $130 again. Stocks, as one might guess, see- sawed between positive and negative territory all day with neither side of the trade being able to sustain control.

The point of this missive is to reiterate there is "economic news" everyday that traders react to with buying and selling decisions, resulting in stock and commodity prices fluctuating everyday. So what else is new?

With the vast amount of financial content on the airwaves, the Internet and the myriad publications, it is easy to get overwhelmed and numbed by indecision, which my partner Mike calls "paralysis by analysis." If you try to play this game it will eat you alive, so don’t play; think!

The value of a stock is its dividend stream. High quality stocks fluctuate between extremes of low-price/high-yield and high-price/ low-yield. When you buy a high quality stock at its low-price/high-yield extreme you are buying its dividend stream when the downside risk is at a minimum and the upside potential is at the maximum. So what if it doesn’t move higher tomorrow, next week or next month? The value is there and eventually it will be recognized but in the interim you will realize dividend increases that will only result in increased value.

Not too very long ago there were only nineteen or so stocks in the Undervalued category. As of the Mid-May ’08 issue there were eighty six; many of which are A-rated or greater by S&P and have the IQ Trends "G" ranking for outstanding dividend growth on an annual basis. I look at the Timely Ten and say "are you kidding me?" GE, McDonald’s, Johnson & Johnson, Colgate Palmolive, PepsiCo, Procter & Gamble and Coca-Cola all at the same time?

No one, not you nor I or anyone knows for sure what the markets will do over the short-term. What I do know is the companies above will continue to do what they have always done; make money and share part of it with their shareholders. That, along with the dividends, you can take to the bank.

THE TIMELY TEN
Investment Quality Trends primary purpose is to assist subscribers in growing their capital and income base from which to derive cash for their current and future needs. To that end we believe that high-quality stocks purchased at historically low-price-to- high-yield offers the best potential for downside protection and upside appreciation.

For subscribers to effectively mirror our Model Portfolio for performance tracking purposes (every stock in the Undervalued and Rising Trend categories), would require holding one hundred twenty eight stocks as of the Mid-May issue; clearly too many positions to be practical.

The Timely Ten, therefore, is not just another "best of, right now" list. It is our reasoned expectation based on our methodology and experience for what we believe will perform best over the next five years. Do we believe that all 10 will go up simultaneously or immediately? Of course not. Our four decades of research and experience, however, lead us to believe that these stocks, purchased at current Undervalued levels, are well positioned for appreciation.

Whether you are looking to build a portfolio from scratch, are partially invested and looking to add new positions, or fully invested and in need of some affirmation and hand holding, The Timely Ten represents our top ten recommendations as of each issue. Short of utilizing the personal investment management services of our sister company, this is as close to hands on advice you can get.

The Timely Ten consists of Undervalued stocks that generally have a S&P Dividend & Earnings Quality rating of A- or better, a "G" designation for exemplary long-term dividend growth, a P/E ratio of 15 or less, a payout ratio of 50% or less (75% for

Utilities), debt of 50% or less (75% for Utilities), and technical characteristics on the daily and weekly charts that suggests the potential for imminent capital appreciation. This issue’s selections are:

Kelley Wright’s stock newsletter Investment Quality Trends is currently performing at the top all of his peers on Wall Street for the past 20 years and is ranked #4 in risk-adjusted performance by Hulbert’s Financial Digest. Kelley’s stock newsletter, IQTrends.com, is earning 11.6% in annualized gains over the past 20 years, according to Hulbert’s Financial Digest, compared to general stock market performance of 11% (as of May 2008). IQTrends.com also has lower risk and volatility than the market average. To subscribe, go to IQTrends.com.

REGULATORY REMINDER Please keep in mind that as an investment newsletter, the staff at Investment Quality Trends are legally bound to only answer questions of a general nature and are unable to provide specific buy/sell recommendations or specific advice on an individual basis. For those interested in obtaining more information on individual management services in accordance with our approach, our sister company, I.Q. Trends Private Client Asset Management, is a Registered Investment Adviser with the U.S. Securities and Exchange Commission. Among the platforms available through I.Q. Trends Private Client are individual portfolio consultations and active account management. For more information, please contact Mr. Michael Minney at (866) 927-5250. Disclosure documents are located at: http://www.iqtrendsprivateclient.com.

Teaching Kids Investing Basics.

by Carrie Schwab Pomerantz, chief strategist, Consumer Education, Charles Schwab & Co., Inc. and president, Charles Schwab Foundation.

April 23, 2008
Dear Carrie,

My son is 12 and I want to get him acquainted with investing in stocks, bonds, funds, etc. What is the best way to get him started?

—A Reader

Dear Reader,
As a firm believer in starting a kid’s financial education early, let me congratulate you on taking an interest now in teaching your son about investing. You have an exciting opportunity to put him on a firm financial path—to share the journey with him—and to watch him grow in knowledge and skill.

At 12, your son should be able to grasp many of the basic concepts and relate them to his own life. The more tangible and real you can make investing, the more interested your son will be.

But before you talk to him about investing, make sure he has a firm grasp of the importance of saving. Has he regularly been setting aside about 10% of his earnings from allowance, gifts or small jobs? Have you opened a savings account for him and discussed how interest works? While these things may seem basic, they are important first steps in learning to manage money. Once your son has a savings plan, you can more easily move on to investing.

Here are some practical approaches that I’ve found effective for kids of all ages:

Keep it simple—While there’s a lot to learn, when it comes to kids, I always suggest keeping investing simple. Use your son’s language. Start by explaining that investing is a means of using your money to create more money.

Use a real goal—Make investing real by focusing on a tangible goal. Chances are your son already has something he’s working and saving for. What’s on the top of his list? A new computer game? Saving for a car? By showing him how investing money on a regular basis can help him earn more money to achieve his goals, you’re more likely to catch—and keep—his interest.

Explain stocks with familiar companies—Kids seem particularly taken by the idea that buying a stock means buying a little piece of a company whose value can rise or fall as the company succeeds or fails. If you tie the concept to a company that your son may be familiar with, say a sports, computer or food and beverage company, he might be interested in following the company’s progress. Better yet, you might consider buying him a single share, so he can experience ownership first hand.

Try virtual investing—Show your son how to research stocks online. Once again, pick companies whose products he knows or uses. Have him "buy" 10 shares of a few companies he likes. Record the "purchase price," monitor the performance and, after a month, have him calculate what he gained or lost. There are also several online virtual trading sites where your son could get some hands-on "trading" experience without investing a dime!

Open a custodial account—To give your son some real investing experience, consider setting up a custodial account under the provisions of the Uniform Gifts to Minors Act or the Uniform Transfers to Minors Act (depending on your state). It’s easy to do online or your Schwab consultant can help. You can start the account with a small amount of money and have your son contribute a portion of his savings to the account as well. You might even offer to match his contributions. Your son can help you select appropriate investments. Then together you can have quarterly check-ins to review how well the investments have performed.

As you and your son explore investing together, don’t forget to emphasize the following essential concepts whenever possible. To me they form the foundation of smart investing—for kids and adults alike:

* Long-term investing—Any market has natural ups and downs but the longer you have to invest, the greater chance you have to ride out these market movements. Historically, over time, investing, particularly in stocks, has been an effective way to help your money grow and keep it from being eroded by inflation. (Note that this lesson is very different from what many kids are learning from the various stock market games offered in schools.)

* Compound growth—Time is probably a child’s greatest asset. That’s because of the power of compound growth. Here’s a way to explain it: As earnings are reinvested back into your original investment and the aggregate amount keeps earning, it’s kind of like a snowball that gets bigger as it rolls down hill. The earlier you start investing, the greater the snowball effect. It’s an image kids can readily understand.

* Risk and reward—When it comes to investing, these two things go hand in hand. There certainly are plenty of recent examples to help underscore this point! The key is to understand how much risk you’re willing to take to earn a potential reward. For example, stocks, bonds and mutual funds are generally more risky than a savings account, but they can also provide the potential for a higher return. This brings us back to the idea of taking a long-term view. Money you need in the next three to five years probably shouldn’t be in the stock market. The risk is that you might have to sell when the market is down. But with your long-term goals, you have more time to ride out market volatility for the potential of a greater reward.

* Diversification—It’s risky to put all your eggs in one basket. For instance, it’s probably not a good idea to invest all your money in the hottest video game or clothing company. If the company falls on hard times (or a host of other possibilities occur), you could lose your money. A great way to minimize risk is to spread your money across different types of investments. For instance, when you invest in a mutual fund, you own a little bit of a lot of companies, so your assets aren’t tied to the success for failure of any one company. So given this, if your child has enough money, think about investing at least half in a well-diversified mutual fund, reserving a small balance for individual stock exploration.

SchwabMoneyWise.com is a great resource for ideas on how to teach kids about money and investing, with worksheets and activities you can do together. It also has some basics on asset classes and investing strategies that you may find helpful in introducing these concepts to your son.

With the current market volatility and all the economic news broadcast everyday, this may be a perfect time to get your son interested in investing—as well as teach him some real-life lessons in risk. He’ll see that investing isn’t just an idea or a game, but a very important part of the real world that’s always changing and never dull!

Good luck!

Important Disclosures

Investors should carefully consider information contained in the prospectus, including investment objectives, risks, charges and expenses. You can request a prospectus by calling Schwab at 800-435-4000. Please read the prospectus carefully before investing.

Investment values will fluctuate, and shares, when redeemed, may be worth more or less than original cost. Past performance is no guarantee of future results.

Diversification strategies do not assure a profit and do not protect against losses in declining markets.

The information provided here is for general informational purposes only and should not be considered an individualized recommendation or personalized investment advice. The type of securities and investment strategies mentioned may not be suitable for everyone. Each investor needs to review a security transaction and investment strategy for his or her own particular situation. Examples provided are for illustrative purposes only and not intended to be reflective of results you can expect to achieve

10 Golden Rules of Investing.

by Natalie Pace

1. Tithe to yourself first.
If you start tithing to your own retirement plan as a teen, chances are you’ll be a millionaire before you’re a grandparent -- even if you contribute only $4000 per year to an IRA, and never increase your contribution. This isn’t trying to figure out how to budget more money for your nest egg. It literally is making your future the FIRST PRIORITY, and putting the deduction on auto-tithe out of your take home salary. Your IRA contributions are tax deductions.

FYI: In years of extremely slow growth, like 2008 is predicted to be, many money managers "overweight" into the safer assets like bonds, up to 10-20% more than normal. This year, according to industry sources, money markets are not as "safe" as they have been in years past because some of the money market managers invested in subprime loans.

3. Diversify your stock holdings.
Small cap stocks provide the highest returns, while huge companies, like Exxon Mobil, General Electric, Wal-Mart, etc. provide stability. Small companies, like Opsware and Taser International, can supercharge your bottom line, while General Electric and Coca-Cola hold up strong and steady (historically) during a down cycle. Having both large and small stocks, as well as value, growth, clean energy and international holdings in your portfolio means you stand a chance of steady annual gains of almost 12% annually, which is what the markets have returned over the past 25 years.

4. Diversify your assets.
Your home is one of the single most important investments you can ever make. A stock portfolio provides almost double the returns annually, on average, than real estate, which is great -- but you can’t live in a brokerage account. I bought a rare gold coin 15 years ago as a gift for someone, which doubled in value. That’s easier to give as a gift than a house! Today, that person is using it as a down payment for his new car. Some years, real estate is all the rage. Other years, stocks are on fire. When consumers have no confidence in currency, gold prices soar. Own them all and be willing to sell when you’ve had great returns! Buy low; sell high!

5. Never loan money to relatives or friends.
You’re not a bank! If you’re friends are coming to you for a handout, chances are it is because every other opportunity has run dry. So, if the professional bankers won’t risk loaning your deadbeat friend money, why should you? Offer creative solutions, if you wish to be helpful. Offer charity, if you feel it is warranted. Give the money, if it would make you happy. But don’t loan it expecting for it to be repaid, unless you’re willing to do as much due diligence and write up the loan documents as a real bank would. If you give money for someone to attend college, it may even be tax deductible! Check with your accountant. Giving money, instead of loaning it, is much better for your peace of mind and relationship than loaning money that has little chance of being returned. Giving has the added benefit that you know how much you can afford to give and never see again, as opposed to frantically, desperately (and foolishly) carping to your friend that you need your loan repaid.

6. Startups are fun or charity – but not nest egg investments.
Your niece’s startup catering business, or your best friend’s new solar energy company. Everybody has the next great idea that they just need a few thousand dollars to start up. However, most businesses don’t succeed. Restaurants and technology companies have some of the highest failure rates of all! High-risk investments, like start up companies, have more in common with gambling than with investing. Therefore, if you want to give someone money to start a business, consider it to be fun money or education money or even charity, but not an investment.

7. Never let relatives or friends manage or invest your money.
Interview your certified financial partner as if you life depends upon it. Your lifestyle does! Don’t let someone step into the second most important role in your life because you feel sorry for or obligated to him or her. Let the professional broker earn your respect before you turn over your money. For tips on how to select your dream come true financial partner, read "How to Find a Broker," in the Investor Edu section at NataliePace.com.

8. Underweight distressed industries and overweight hot industries.
Cold industries: How many airlines have gone bankrupt this decade? When over half of the companies in any industry are having trouble, just select more fertile ground. Why invest in an industry that is losing money by the billions? If your company goes bankrupt, you’ll lose everything!

Hot industries: Has every country on the planet placed green on their government agenda, with powerful profit incentives to companies and citizens who power up off the grid, with solar, wind and/or geothermal power and electric or hybrid cars? Buy into exploding sectors. Clean energy was the top performer on Wall Street in 2007, earning almost 60 cents on the dollar, while airlines were losing money, going bankrupt and waging price wars with one another.

For more Investing 101 Tips, go to the Investor Edu section of NataliePace.com. If you have a question for Natalie, email us or post it on the Sharing Wisdom bulletin board.

Ask Natalie: Hot Tips Are Not Hot Stocks.

Subscribers chat with Natalie Pace.

Photo by: Doug Mazell, 562.866.7662, www.mazell.com Makeup & Photo Styling: Arlene Hylton-Campbel, 818-710-0079

Dear Natalie,
Have you done a report card on Aussie Soles, AUSE? What do you think of this company and its potential?

Thank you!
Cynthia

Hi Cynthia. Thanks for writing to me. Here’s a 5-minute analysis of Aussie Soles.

The first thing that I do when I’m researching a company is enter the stock symbol in the Company Research box on the home page at NataliePace.com. That takes me to the stock page. From there, I click on Company Report (located on the left navigation bar), which usually provides a description of what the company does. On the company report of Aussie Soles, there is no description available. It’s not available because the company is trading off the boards.

Companies that trade "off the big boards" are EXTREMELY HIGH RISK because they haven’t met the criteria to list on NASDAQ or the New York Stock Exchange. That fact alone will end my research right there, unless there is a very compelling story going on.

Wisdom Tree was trading off the boards when I featured it, as was U.S. Gold. Both companies had incredible executive pedigrees, interesting industries and products, and lots of money to launch with. All of these things have to be present and impressive to the nines before an off the boards stock looks interesting to me. And after a brief look around the Aussie Soles website, it looks like the founder, President and CEO, Craig Taplin, is the only person on staff!

So, at this point, I have more questions for you than I have answers.

Why are you interested in Aussie Soles? Did you get a hot tip from someone or do you just like the shoes? If you love the shoe and think it’s going to be the next great breakthrough thing, then you need to look deeply into the executive suite to see who is going to make it all happen. It takes experience and an outstanding marketing, sales and distribution plan to make anything the next great sensation!

If Aussie Soles was a hot tip, chances are that someone was paid to give it to you. Hot stock tips are usually expensive lessons, unless they come directly from Warren Buffett. The phishing and pump and dump scams are getting so sophisticated that agencies like the Securities and Exchange Commission and FINRA.org are constantly publishing Investor Alerts to foreworn you. In fact, be sure to check out the SEC alert that I’ve published in this month’s ezine, entitled, "’Wrong Numbers’ and Stock Tips on Your Answering Machine."

I’ve started a topic on Aussie Soles on the Sharing wisdom bulletin board, so that you can answer some of these questions. I hope you tell us more about why you are interested in this company, so that others can all learn from your experience. I think I’ve seen the shoes around, so perhaps you think you’re early on a fad? Could be! Very high risk, however, especially since we don’t know much about the founder/CEO and the rest of the team.

Dear Natalie:
Your picks are impressive. I would like to know which subscription service (Premium?) is required to gain access to current buy / sell info from your ezine.  For example, you state profits were taken in February 2008 for the investment in Suntech Power Holdings, originally featured October 2006.  I know Natalie is not a broker. However, would it be safe to say that when she features a company it is a good sign to buy?  Would she announce when she is buying what stock?  How would I know when to take profits? Would Natalie announce her plans on taking profit at a specific time for a specific stock?
  
To use Suntech Power Holdings as an example again, it seems wise to take advantage of Natalie's featuring of a company before she selects it as "Company of the Year."  Investment in October 2006 would have yielded a 107% return vs. 57% in January 2007, for this 2007 "Company of the Year."  So it seems too late to get maximum (potential) returns if we wait until Natalie selects a "Company of the Year" to invest in that company.  In other words, it seems wise to buy when she features a company first, right?
  
I know this is a mouthful but I want to make sure I understand the benefits offered at the Standard and Premium levels. I trust Natalie's judgment as the number one stock picker.  Even more, when my family and I met her in October 2006 we could tell she has great character and is genuinely concerned about people.
  
P.S.  When is the next retreat?

Thanks, Doc.

Whew, Doc, that is a mouthful. I’m going to be a little brief, but hopefully VERY informative.

First of all, the best information on how to really use the Hot News on Cool Stocks list is featured in the FAQs article, located under the Investor Edu link on the home page at NataliePace.com. That gives you a lot of information on the Hot News articles, the ongoing news, etc., of the companies that I feature, which I publish twice a month.

It’s important to know that I am an investigative financial journalist, not a money manager. In other words, my job is to give you a great report on the company, and your job is to determine (with your financial planner) whether or not that company is right for your portfolio, given your investment goals, retirement date, risk tolerance, etc. A great financial planner should be up to date on all of the best products, like IRA, Roth IRA, health savings account, college savings account, SEP IRA, etc., whereas a great journalist spends her day researching the best companies on the planet. Different jobs. Each is important! I don’t know a thing about SEP IRAs and the maximum contribution, but I make it a point to attend industry conferences, test drive electric cars, interview the CEOs and much more to ensure that the companies I’m reporting on are great. On the other hand, your broker has hundreds of clients and spends most of his/her time selling products, taking money and executing orders, based upon research that other people do (like analysts, their company recommendations or journalists, like me).

Because I’m a journalist and featuring news on publicly traded companies, I am restricted with regard to what I can and cannot own, so when you see "take profits" that means that I have taken the company off the news list. And yes, when I take a company of the news list, I alert people and tell them why I’m doing it. If you read the Hot News article, you’ll see that I actually have three lists of companies; 1) Hot News (on companies poised for gains); 2) Watch List (companies I’m watching to add to one of the other lists); and 3) Cooling Off list (companies that are poised to go down in value).

Premium subscribers have a number of benefits over the regular subscription. The ezine subscription is like an online magazine – just the news – very helpful, but you must be self-directed. The premium subscription adds an interactive element and one-on-one access to me in quarterly teleconference calls (interactive Q&A), monthly online chats and special news reports from me on very active or volatile trading days.

The next retreat is September 23-25 in Santa Monica, California, and is limited to just 10 people. This retreat offers three very intense days of high level, hands on investment skills that will transform your relationship with money and stocks forever. You will bring your computer and learn everything from nest egg strategies to how to pick breakout stocks.

And yes, I keep this retreat intimate and small so that you can maximize your education. My book comes out at the end of the year, and when it’s a best seller, it is unlikely that you will have the opportunity to learn from me in such a small gathering.

There are no crystal balls with regard to when a company will be the best buy or sell. Check out the Hot News Report for a full list of winners, but know that Suntech’s 57% gain as the Company of the Year 2007 was as good as it gets – especially considering that the general stock market was flat -- zero gains -- on the year! Also, please note that Suntech had almost tripled from the January listing price of $36 to its 52-week high of $90! Other Companies of the Year have had very strong performance as well, including Taser International, but not every company is a winner. No Wall Street pundit has a 100% hit rate.

3 out of 5 Company of the Year selections more than doubled.  My 2003, 2004 and 2007 Companies of the Year have posted up to 9000% gains (Taser), up to 690% gains (Opsware) and up to 215% gains (Suntech Power Holdings), respectively.  MySpace, my 2006 Company of the Year, was a large part of News Corp’s success with shareholders that year.  Only OSI Pharmaceuticals, my 2005 Company of the Year, has lost money.  So three out of five were superperformers, one is performing well above the market and one is down. That’s the kind of record that puts you on top on Wall Street.  (I launched my first publication on 11.15.02, and featured the first Company of the Year on 1.1.03.)

I’ve postponed naming the Company of the Year in 2008 because in January I predicted that we were entering a volatile, down-trending year and knew that even great companies would have trouble swimming up current when the general market was dragging south. I’ll be naming the 2008 Company of the Year between now and the end of the year, so keep your eyes open! If any of my favorite companies takes a big hit to its share price (with the marketplace), I may name one right at that moment.

If you are interested in a premium level subscription or in coming to the retreat, be sure to email Heather right away. If you pay for the retreat by Father’s Day 2008, you will get the low early bird price of just $995 AND receive the premium subscription FREE for a full year. Quite a deal since the value of the premium subscription is $1495 (and the value of the retreat is priceless).

Remember that an investment in education NEVER goes down in value. Keep reading the ezines and the mid-month updates. The ezine costs less than lunch per month, and you’ll love fattening up your brain and portfolio with the meal!

If you have a question for me, feel free to email Heather@NataliePace.com with "Ask Natalie" in the subject line. You can also check out my AskNataliePace blog at AskNataliePace.blogspot.com.

Take Your Profits Early and Often.

by Natalie Pace.

Includes my Hot News on Cool Stocks List.

General Stock Market Performance

In May, I reported that I just didn’t have that much faith in the intelligence of the April mini-rally. It smelled to me of desperate money managers and brokers trying to capitalize on April (taxes) client meetings by saying that stocks are cheap. Real estate, stock and mortgage brokers were saying that it was a great time to buy real estate and stocks on sale in 2007 and 2008, even though the Federal Reserve Board Chairman Ben Bernanke was saying that economic recovery wouldn’t occur until 2010. According to Ben Bernanke, in his semiannual money policy report to Congress of February 27, 2008, "By 2010, our most recent projections show output growth picking up to rates close to or a little above its longer-term trend and ...  an anticipated moderation of the contraction in housing and the strains in financial and credit markets.  The incoming information since our January meeting continues to suggest sluggish economic activity in the near term."

Even though I love America, have faith in our ability to produce innovative products and solutions that the world adores and think that we’ll always be a great, free nation, the underlying economic fundamentals of this year are quite challenging. GDP growth rate has flat-lined. Oil is over $100/barrel. Companies are laying off employees. Inflation is being under-reported (because it excludes gas and food, two of the biggest drains on the consumer’s wallet). Economist Dr. Gary Becker says, "It’s going to get worse, but I don’t anticipate a major depression." Incidentally, Dr. Becker has been right on the economy for the six years that I’ve been attending the Milken Global Conference.

So this year, I’m a fan of taking any profit any time you can get your hands on one. If there is a need for alarming headlines between now and September, there are many startling facts which can be trotted out to scare the heck out of investors, including the likely truth that the complete fall-out of the subprime mortgages is not over, nor is the real estate pullback, which means lower net worth for each household in the U.S., which means no equity ATM to keep the economy running on the consumer wallet and lower sales which constrict corporate spending and profits. Without consumer spending, corporation spending or real estate values, how can Wall Street continue to impress quarterly earnings junkies? You’ll see a lot of pressure on Treasury Secretary Hank Paulson and Federal Reserve Board Chairman Ben Bernanke to come up with quick fix solutions so that we can get through the elections in November without a crisis of confidence, so volatility will prevail.

Professional money managers have a lot of pressure on them to make gains in a tough, down-trending marketplace. When you see a dramatic run-up, there will be short-selling and put options, trying to capitalize on the bear market (and pulling down the prices with the sheer weight and power of the big investor plays). Take a look at just how many times the market has seesawed since January and you’ll see what I’m talking about. You’ll also see that at the beginning of May we were poised at the top of the trading range for the year, which lead me to believe that the markets were ripe for another pullback. That, so far, has been the case.

Source: MoneyCentral.msn.com

So, my mantra this year is: "Take your profits early and often." If you’ve made gains above 12% in your trading portfolio, take them. Be patient about buying back in. (Remember: this applies to your trading portfolio. In your nest egg, you should be taking a longer view.) Then reread the "Recession Proof Your Portfolio" and "Trading Tips for Turbulent Times" articles from the volume 5, issue 2 NataliePace.com ezine to make sure that you’ve got your defensive game on. Understand the tax ramifications of short-term capital gains.

In other words, day-trading in today’s stock marketplace is not for beginners. If you wish to trade, make an investment in education first. (Email Heather and be just one of ten people to come to my retreat on September 24-26,2008 in Santa Monica, CA.) Investors with a long-term game plan still need to adjust for the current marketplace, while continuing to understand that regular tithing to the nest egg, proper asset allocation and diversification have worked wonderfully for the past century.

A Special Note on Google: Don’t be tempted to buy Google high in such a volatile marketplace. There could be another opportunity to buy it in the low $400 range, which is why Google is on the Cooling Off list right now, even though it is still a great corporation and a strong holding in your long term portfolio (at the right price).

Track Record of our Reporting
While the markets have fallen in 2008, the Hot News and Cooling Off lists below have a winning track record – in bear and bull market years. 21 companies listed below have delivered positive gains, even while the general marketplace is down 5%. Only seven of our listings went in the opposite direction of the reporting. Even during the flat year of 2007, our featured companies had outstanding performance between Oct. 2006 and June 2007! 4 out of 9 companies – almost half – doubled or more from the time they were featured to the time they were taken off of the list. 48% of the companies featured in my stock newsletter between 2002 and 2005 – 25 out of 52 companies -- DOUBLED as well, and the majority of the remaining 52% well outperformed the marketplace. (See the chart in the article, "25 of Our Companies Have Doubled," from volume 4, issue 4, the April 2007 ezine, for a listing of companies.)

3 out of 5 Company of the Year selections more than doubled.  My 2003, 2004 and 2007 Companies of the Year have posted up to 9000% gains (Taser), up to 690% gains (Opsware) and up to 215% gains (Suntech Power Holdings), respectively.  MySpace, my 2006 Company of the Year, was a large part of News Corp’s success with shareholders that year.  Only OSI Pharmaceuticals, my 2005 Company of the Year, has lost money.  So three out of five are superperformers, one is performing well above the market and one is down. That’s the kind of record that puts you on top on Wall Street.  (I launched my first publication on 11.15.02, and featured the first Company of the Year on 1.1.03.)

TipsTraders.com continues to list me as a Highly Recommended Stock Picker, with their independent ranking system, where I’ve repeatedly occupied the #1 position. Some of our best picks include: Bioteq Environmental (BQE) +144%, Blockbuster Video (BBI) +82.5%, Genentech (DNA) +415%, Google (GOOG) +545%, Las Vegas Sands (LVS) +139%, LifeCell (LIFC) +180%, Macerich (MAC) +150%, Opsware (OPSW) +690%, Rio Tinto (RTP) +145%, Sohu (SOHU) +150%, Suntech Power Holdings (STP) +107%, Taser (TASR) up to 9000% gains and World Water & Solar (WWAT) +181%.

Market Movers:
The Bureau of Economic Analysis released its preliminary report on the 1st quarter 2008 GDP growth on April 30^th. The numbers came in at .9% -- anemic growth, down from the robust 4.9% GDP growth in the 3^rd quarter of 2007. The next GDP growth report – final numbers for the 1^st quarter 2008 GDP growth – will be released on June 26, 2008.

The state of the economy is likely to continue to be headline news, and if the news is bad, more market fallout could occur. There are no guarantees, but in this scenario, you really need to have a great plan in order that is diversified, with a percent equal to your age safe – not at risk. (The "Recession Proof Your Portfolio" article listed above is something that you MUST read to make sure that your broker is truly protecting your assets.)

For more BEA release dates, go to the BEA.gov website and be sure to visit the NataliePace.com calendar section often.

The Federal Open Market Committee and Monetary Policy
The Federal Open Market Committee has dropped the Fed Fund Rate each of the last six sessions. The Fed funds rate currently stands at two percent. Expect the Federal Reserve Open Market Committee to continue to ease investor worries, while monitoring inflation. The prevailing sentiment is still weak growth, a continued housing slump, more subprime foreclosures, a weak dollar, anemic consumer spending, turmoil in banks and financial services, rising gas and food prices and rising unemployment. (Yikes!)

Even with continued strain in the financial markets, the housing markets and the consumer wallet, don’t think that another Fed Fund interest rate reduction is likely to happen this time around. In the minutes of the Federal Open Market Meeting held in April 2008, it was noted that, "Most members viewed the decision to reduce interest rates at this meeting as a close call." Two of the ten voting directors at that meeting voted against lowering the Fed Funds rate.

EDUCATIONAL OPPORTUNITES AND INFORMATION:

1. FOMC Information: Interested in reading the minutes of the April 29-30, 2008 FOMC meeting for yourself? You can. The official Federal Reserve document is available online. Click on FOMC, or go to FederalReserve.gov to read! According to the press release, "Economic activity remains weak. Household and business spending has been subdued and labor markets have softened further. Financial markets remain under considerable stress, and tight credit conditions and the deepening housing contraction are likely to weigh on economic growth over the next few quarters."

The tentative FOMC meeting schedule for the 2008 calendar is: June 24-25, 2008 (Tuesday-Wednesday), August 5, 2008 (Tuesday), September 16, 2008 (Tuesday), October 28-29, 2008 (Tuesday-Wednesday), December 16, 2008 (Tuesday).

2. Calendar Section: Conferences, Online Chats and more: Check out the Calendar section of NataliePace.com regularly. There are many wonderful opportunities to chat one-on-one with millionaire money managers, life coaches, economists, respected money gurus, real estate veterans and CEOs! Be sure to check out the dates of the mid-month Hot News on Cool Stocks Update and the publication date of our next ezine. Get more information on how to best use our articles in the FAQs article, located under the Investor Edu link on the home page of NataliePace.com. Don’t miss the Premium Subscriber Teleconference on June 5^th. Information on how to call-in will be listed on the Sharing Wisdom Premium Subscriber bulletin board (or email Heather for the information).
   
   
3. Survey Results. Wonder what Dad really wants for Father’s Day? Vote and view on the home page at NataliePace.com.

Hot Stocks List
Investors who "never pay retail," note that highlighted stocks are trading at their 52-week lows or near the price featured in NataliePace.com’s article. This may be a good buying opportunity. The companies that are listed below which are not highlighted may not be in a good buying range, but they appear to be poised to continue performing well (if you have already purchased them). There are never any guarantees in life, and all stocks are risk-based investments. Consult your certified financial planner before making any changes to your investment strategy.

Hot News List (highlighted). Be sure that you are buying low.
Altair Nanotechnology (ALTI)
Conergy (CEYHF)
Hoku Scientific (HOKU)
Smith & Nephew (SNN)
Suntech Power Holdings (STP)
U.S. Gold (UXG)
Wisdom Tree (WSDT)
World Water & Solar (WWAT)

DELETIONS (Remember to take your profits early and often):
Johnson & Johnson (deleted on 5.5.08)

HOT NEWS on COOL STOCKS LIST

 2008 Companies featured:
Echelon +20%, GE, +13 and +18%, Google, +15% and +31%, Johnson & Johnson +10%, LDK Solar +18%, Microsoft +12%, Satcon +13%, Suntech +35%, Trina Solar +22%, World Water & Solar +22%.

Recently Deleted: Take your profits early and often!

Stocks to Watch
Some of these are great companies that we’re thinking of adding to the Hot List and some are stinkers we’re thinking of adding to the Cooling Off List.  Read carefully to identify which is which!  

Note that right now most of our favorite companies are on the Watch List, anticipating continued weakening of the stock market, and share prices.

Recent Additions:
LDK Solar (LDK)
Microsoft (MSFT)
Ross Stores (ROST)
Satcon Technology (SATC)
TJ Maxx (TJX)
Trina Solar (TSL)

Recent Deletions:
Apple Computer (AAPL) (moved to the Cooling Off List)
Genentech (DNA) (moved to the Hot List)
International Rectifier (IRF) removed 6.1.08
Smith & Nephew (SNN) (moved to the Hot List)
UQM (UQM) removed on 6.1.08

Cooling Off Stocks List (may be Poised for a Decline in Share Price).
Note: The companies listed in bold have recently been added to this cooling off list and/or may be currently poised for a decline in value. Investors who have them in their portfolio should read the recent news and consider whether it is time to sell and take profits, dump losses, short the position and/or simply weather the storms, while keeping the company in their long-term portfolio. At any rate, always consult your certified financial partner before making adjustments to your portfolio. (Again, note that the stocks on this chart are expected to go DOWN in price.)

Highlighted Companies (Cooling Off List):
Apple (AAPL)
Medicis (MRX)
Mentor (MNT)
Sears Holding Company (SHLD)

Recent Deletions:
Novastar Financial (NFI) removed 6.1.08

Recently Deleted in 2008:
Fannie Mae was deleted on 2.11.08 with -50% and -56% performance. Novastar Financial (NFI) was deleted on 6.2.08 with -95% performance. (see below for details)

Please note: NataliePace.com does not act or operate like a broker. We report on financial news, and are one of the most trusted independently owned and operated financial news corporations in the U.S. This article is intended to educate and inform individual investors, and, thus, to give investors a competitive edge in their personal decision-making. The publicly traded companies mentioned in this article are not intended to be buy or sell recommendations. ALWAYS do your research and consult an experienced, reputable financial professional before buying or selling any security, and consider your long-term goals and strategies.

Investors should NOT be using the Hot News on Cool Stocks list or the Cooling Off list to trade their nest eggs. Your retirement plan should reflect a long, safe strategy, which has been designed with the assistance of a financial professional who is familiar with your goals, risk tolerance, tax needs and more. The "trading" portion of your portfolio should be a very small part of your investment strategy, and the amount of money you invest into individual companies should never be greater than your experience, wisdom, knowledge and patience.

IMPORTANT DISCLAIMER: Information has been obtained from sources believed to be reliable however NataliePace.com does not warrant its completeness or accuracy. Opinions constitute our judgment as of the date of this publication and are subject to change without notice. This material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.

NataliePace.com Calendar:

Don’t miss the Premium Subscriber Teleconference with Natalie Pace on June 5^th or the subscriber chat with bestselling author, Chellie Campbell on June 25th.

The NataliePace.com Calendar section features conferences, retreats, educational opportunities, cultural events, galas, market events and online chats with executives and VIPs. Stay plugged in! Visit our calendar section often.

See below for just a few of the amazing educational and networking opportunities that world-class organizations are offering for you. To access links to the event website and registration, go to the Calendar section at NataliePace.com.

Premium Subscriber Teleconference with Natalie Pace
Thursday, June 5th, 2008

5:00PM through 6:00PM PT
Want to get in on stocks like Suntech, Sohu, Opsware, Google and World Water and Power BEFORE they make 300 to 600 percent gains? Have questions about where the stock market is headed? Get the news, information and education you need to succeed! Premium subscribers: go to the Enlightened Billionaires (Premium Subscribers only) bulletin board on the Sharing Wisdom bbs to get your call-in number and ID.

Business Goes Green Expo: San Jose, CA
Friday, June 6th, 2008
This business summit will show how going green is good for the bottom line!

Puccini's La Rondine
Saturday, June 7th, 2008
7:00PM through 11:00PM PT
LA Opera celebrates Puccini's 150th Anniversary and the final performances of the season! Don't miss opera at its finest with one of the most respected composers in this field.

Private Film Screening of Teen Produced Movies, LA, CA
Thursday, June 12th, 2008 7:00PM through 10:00PM
Step Up Women's Network and Landmark theatres at the Westside Pavilion bring you a private event showcasing the compelling short films and acting of the teens Step Up serves. FREE!

Candlelight Memorial, Dana Point, CA
Thursday, June 12th, 2008

8:30PM through 9:30PM PT
14th Annual Candlelight Vigil in the memory of Nicole Brown and all Victims of Violence. Light a candle in memory of your loved one To Banish the Darkness and End the Silence.

Dill 'n Eddie Show, LA, CA
Saturday, June 14th, 2008

7:30PM through 11:30PM PT
Living Legends, RJD2 and GZA in a show to support the charities of two living legend teens from LA, CA.


Sacred Service Saturday, LA, CA
Saturday, June 14th, 2008

Agape International Spiritual Center's 15th Annual Sacred Service Saturday is your personal invitation to awaken the natural compassion of your heart and direct its energy into action by volunteering your time to serve communities and people in need.


Father's Day
Sunday, June 15th, 2008


Honor Dad right! Check out some of the links to cool websites, including the Ferrari website, in the NataliePace.com shopping mall.


Premium Subscriber Online Chat with Natalie Pace
Wednesday, June 18th, 2008

8:45AM through 9:30AM PT

Hot industries, like solar energy, and sinkholes, like the financials. What's the best strategy for the next few months? Learn trading tips for turbulent times, summer doldrums and prep for the Back to School Stock Sales.


Business Goes Green Expo: Las Vegas, NV
Thursday, June 19th, 2008
Climate change, renewable resources, carbon footprint, energy consumption, water conservation, responsible investing, global supply chain, and alternative fuels -- terms that once were used only by environmental activists are now considered essential to growth.

First Annual Women and Money Day! LA, CA
Saturday, June 21st, 2008

9:30AM through 2:30PM 
PT
Who needs Prince Charming? I can support myself! Join Junior Achievement of Southern California in a financial empowerment day geared toward women ages 10 and above. includes lunch. RSVP ASAP to 323.785.3517.


Federal Open Market Committee Meeting
Tuesday, June 24th, 2008 and Wednesday, June 25^th, 2008
8:00AM through 5:00PM ET
The Federal Reserve Board governors meet to determine whether inflation is more of a factor than the housing pullback and subprime defaults. Will the Feds keep the rate where it is, raise it or lower it?

Chat with best-selling author Chellie Campbell
Wednesday, June 25th, 2008

8:45AM through 9:30AM PT

Chellie Campbell has written two books that have gone on to become bestsellers. Learn the real deal about getting your book published and what kind of $$ it can add to the bottom line of your business.

Fridays Off the 405, The Getty Center, LA, CA
Friday, June 27th, 2008
6:00PM through 9:00PM PT
A once-a-month after-work event mixing art and entertainment where you can socialize, tour the galleries, and revel in the end of the workweek in a casual, spontaneous atmosphere. All Fridays Off the 405 feature live music and a cash bar.

4th Campus Progress National Conference, Washington DC
Tuesday, July 8th, 2008

A FREE dynamic one-day event that brings more than 1,000 young people from across the country together to discuss issues that matter, connect with each other, and hear from prominent politicians, activists, journalists, scholars, and artists.

eWomen Network International Conference, Dallas, TX
Thursday, July 10th, 2008


Attend the largest 4-day women's conference and expo in North America with CEO Sandra Yancey. Access new customers, expand your business resources and hear Mimi Donaldson share her tips on Negotiating for Dummies.


Soul Sisters Retreat, LA, CA
Friday, July 25th, 2008
through Sunday, July 27th
The annual Agape Soul Sisters Retreat with Dr. Rickie Byars Beckwith, Reverend Greta Sesheta and more. Our roots run deep. Discover, bond, transform, meditate, celebrate...


7th Annual UC/CSU/CCC Sustainability Conference
Thursday, July 31st, 2008

Join over 850, students, staff, faculty and administrators n California higher education to explore the ways in which we can implement social, environmental, and economic sustainability on our campuses statewide, prepare future generations for "green college."

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