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Vol.6 Issue 10, October 1st, 2009
Send comments and suggestions or get more information at info@NataliePace.com

Quote of the Month:
"I was not going to be the Federal Reserve chairman who presided over the Second Great Depression. For that reason, I had to hold my nose and stop those firms from failing."

Federal Reserve Board Chairman Ben S. Bernanke,
Speaking in a Town Hall meeting hosted by the NewsHour with Jim Lehrer on July 26, 2009 (Video)


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Company of the Year.

by Natalie Pace.

2002 was a record year for veteran gold mining executive, Rob McEwen. He won Northern Miner's Man of the Year Award, Ernst & Young's Ontario Entrepreneur of the Year Award in the Energy Category; and the Prospectors and Developers Association of Canada's Developer of the Year award. Under his leadership, Goldcorp was named one of Fast Company magazine's 50 Companies of Innovation, and was selected by Business Week magazine as one of the 50 most innovative companies on the web.

After 18 years leading Goldcorp, McEwen could easily have retired to enjoy the golden years he’d bagged. His payoff was long and hard-won. As Goldcorp's Chairman and CEO, he'd survived a bitter 46-month labor strike, found new reserves in a tapped-out mine, invented the Goldcorp Principle (now an industry standard for identifying new reserves through open-sourcing), won industry awards, received media recognition, attracted investors and positioned the market capitalization of Goldcorp to rocket from $50 million to its current value of $28 billion. It reads like a sentence until you realize the significance of each of those achievements. If he didn’t find new reserves or end the strike; the company would have gone out of business. His life and his livelihood were all at risk, and it is his legacy of tenacity against all odds and naysayers, as much as his inventiveness, which is what makes him the perfect Chairman and CEO of his newest venture, U.S. Gold.

U.S. Gold is another nail-biter of an endeavor. Can McEwen use his skills at identifying new reserves to amass the next Cortez Trend in Nevada? Will he run out of dough and investor/believers before he hits the Mother Lode? Will the major indices gamble on an exploration company, or shun his track record and stick with companies that are actually mining gold, instead of the renegade explorers? Has he overtapped his resources by prospecting in Mexico?

U.S. Gold began trading in 2005, and within a year, investors had bid the stock up to $10/share. Initial drilling results were less than glorious, and by October 2008, U.S. Gold had lost some of its top talent and the share price bottomed out at just 44 cents. Chairman/CEO McEwen had to raise more capital to keep drilling (and avoid a delisting). As part of the capital infusion plan, McEwen has been putting his own money into the corporation. In 2009, more than 8 million shares were purchased by McEwen and funds owned by him, but other officers, including CFO Ing Perry have bought in this year as well.

Now, certainly, I wish I’d named U.S. Gold as Company of the Year in 2008 at 44 cents. We did highlight the company at that time, and told investors it was a steal. Our subscribers have earned up to four times return on their money in a bear market where few dare to hope for gains of that magnitude. Before you bag your profits and go home, however, consider that U.S. Gold’s potential could be only beginning.

Rob McEwen’s last endeavor, GoldCorp, which is currently valued at $28 billion, started out with a $500 million market cap, in the range of where U.S. Gold is now. On September 15, 2009, the S&P added U.S. Gold to the S&P/TSX Global Gold Index and S&P/TSX Global Mining Index. So, the company should start seeing more institutional support.

Finally, there are already signs that cash-rich investors are seeking hard assets as safe havens, fearing that the bailouts and stalled U.S. economy will further weaken the dollar, and that Treasuries, when printed out like paper, are destined to devalue faster than cars and commodities. Over the past year, cash-flush Chinese companies have wooed the Opel brand of General Motors (unsuccessfully to date), Rio Tinto (a gold/copper/iron mining company) and frankly, just about every Australian mineral or resource entity that it can get its hands on. Premium label gold stocks, and I certainly believe that anything Rob McEwen is attached to is the A-team in gold mining, could benefit from the worldwide infatuation with hard assets.

Thus, U.S. Gold is my Company of the Year for 2009. U.S. Gold has been on the Hot News list for many years. I highlighted it again this month, while the share price is in the range of $2.60. Be aware, however, that a positive GDP report on October 29, 2009, could negatively impact the price of gold. Therefore, it is conceivable that the share price of U.S. Gold could become even more attractive in the wake of such event. Market timing this sort of thing works only if you have a crystal ball. Dollar cost-averaging, i.e. buying a little now and a little later if the price becomes more attractive, can be very effective.

Buyer Be Notified that U.S. Gold is an exploration company, not a mining company. They don’t produce gold at this time.

 

Full Disclosure: I own shares of U.S. Gold. I do not own positions in any other companies mentioned in this article.

About Natalie Pace:
Natalie Pace, is the author of Put Your Money Where Your Heart Is and CEO of one of the most respected, independently owned financial news corporations in the U.S. She has been ranked as a #1 stock picker from TipsTraders.com and has partnered content with
Forbes.com, Sohu.com, Kiplinger’s Personal Finance and more.  She has appeared on Fox News, Good Morning America, CNBC, Time Magazine, More Magazine, USA Today, NPR and national radio shows. Ask her your money questions on her weekly radio show on BlogTalkRadio.com/NataliePace! Follow her on Twitter.com/NataliePace, YouTube.com/NataliePaceDOTCOM and Facebook.com/NatalieWynnePace. For more information please visit, http://www.nataliepace.com
.

 

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.


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Obama, Clinton and the Sexiest Man on the Planet.

by Natalie Pace.

The world applauded when President Barack Obama and his Secretary of State, Hillary Clinton, became the new faces of America. And now, women in particular (and the men who love them) have even more cause for celebration, in the appointment of Melanne Verveer as the first ever U.S. Ambassador-at-Large for Global Women’s Issues. Wherever there is abuse, inequality, injustice, poverty and malnutrition, there you will find Ambassador Verveer seated in the halls of justice and government to address the concerns, making sure that the feminine perspective is given due consideration. Ambassador Verveer’s efforts helped to save the life of the sexiest man on the planet (keep reading).

Ambassador-at-Large for Global Women's Issues Melanne Verveer visited Badghis Province, the poorest province in Afghanistan, on June 25, where she met with Governor Arman, Provincial Council Members, the line director for the Ministry of Women's Affairs, grassroots women's organizations, women leaders, and female candidates for the upcoming elections.

So, what does an ambassador for women do? Ambassador Verveer’s mission is to work for the political, economic and social empowerment of women. But what does that actually look like and why is that even important?

Ambassador Verveer was sworn in on June 12, 2009 and by June 25, she was already in Afghanistan. Prior to her visit, in February and March of 2009, the Afghanistan National Assembly and President Karzai had signed The Shi’a Personal Status Law which allows men to have sex with minors, imprisons women in their homes, obliges a wife to obey her husband in all sexual matters and gives her unequal status with regard to divorce, guardianship of children, inheritance and enjoyment of property (source: UNAMA report, July 2009). Ambassador Verveer was just visiting President Karzai’s country to remind him of President Obama and Secretary Clinton’s personal commitment to women’s rights. According to Ambassador Verveer (and a landslide of data), "Countries that repress women also tend to be backward economically, and are more likely to be failed states."

While in Afghanistan, Ambassador Verveer announced $27 million in funding for local NGOs to provide economic development, literacy, training, skills training, and healthcare. In the wake of her departure, President Karzai reported to the United Nations that the Shi’a Personal Law had been amended and would be presented to Parliament for adoption after the August 2009 elections. Additionally, on September 7, 2009, President Karzai gave a hush-hush pardon and ticket out of the country to Sayed Parvez Kambakhsh, 24, a young male journalist trainee who had been sentenced to death for publishing articles on women’s rights in Afghanistan.

According to Ambassador Verveer, President Obama and Secretary Clinton have made women’s rights so prominent because it is clear that "there have to be strategic places in government, in our development agencies and in our state department to ensure sure that these kinds of issues get addressed and the resources get allocated in a way that is thoughtful, meets the purpose, is measurable and that outcomes, in fact, get achieved." Mission accomplished, at least in the life of Mr. Kambakhsh. In atom-splitting speed. With regard to the amended Shi’a Personal Status Law, "Changes were made, but it's still very flawed," according to Ambassador Verveer. The amended law has not yet been passed in the Afghan National Assembly.

Another major focus of the State Department is to promote peace and security worldwide through a very basic, yet innovative approach – alleviating hunger. At the Clinton Global Initiative Closing Plenary session on September 25, 2009, Secretary Clinton announced a novel approach for her State Department – promoting security through a global food initiative. According to Secretary Clinton, food is all about "economic security, environmental security, and even national security."

"People who are starving, who have no incomes, who can’t care for their families, are left with feelings of hopelessness and desperation," according to Secretary Clinton. "Desperation of that magnitude sows seeds of its own—of tension, conflict, and violence. Since 2007, there have been riots over food in more than 60 countries."

So what does this have to do with Ambassador Verveer? Everything. The majority of farmers in the developing world are women. The issues that prevent agricultural development are not as simple as water – which is of course, essential – but also extend to land ownership, credit, microloans and literacy. Most of the women are toiling fields they don’t own, borrowing money for seeds at rates that keep them impoverished and are not organized, empowered or literate enough to ameliorate the situation.

The goals are lofty and the stakes are high. Secretary Clinton aims to "increase the world’s food supply for both the short and the long term; diminish hunger; raise farmers’ incomes; improve health; expand opportunity; and strengthen regional economies." The woman Secretary Clinton put in charge by her side, Ambassador Melanne Verveer, has been toiling in the trenches of policy issues for decades alongside her. Before becoming the Ambassador of Global Women’s Issues, Ambassador Vermeer was the Chief of Staff to First Lady Hillary Clinton.

Sexiest Man on the Planet, Sayed Parvez Kambakhsh.

What does a world run by women look like? Thanks to Secretary Clinton and Ambassador Verveer, we are finally getting a glimpse. And, from my chair, looking at the pardon of Sayed Parvez Kambakhsh, the proposed amendment of the Shi’a Personal Status Law and the promotion of microcredit, literacy, land rights and education to the farmers of underdeveloped countries worldwide -- all this is under six months at this newly created position -- that world is beautiful.

You can follow Ambassador Verveer’s work on Twitter.com, Facebook.com and at the State Department’s website at State.gov/s/gwi.

We don’t know where Sayed Parvez Kambakhsh’s escapades will lead him in the future, but for now, he is simply the Sexiest Man on the Planet. May his exile bring him untold freedom, and his future endeavors continue to give oppressed women in his home country hope.


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Cash Q&A: Schwab Answers Your Questions.

by Rob Williams, Director of Income Planning, Schwab Center for Financial Research

Updated September 30, 2009

Each month, Schwab.com receives thousands of questions from clients. Here, we tackle the top questions on cash investments, with answers and guidance we believe will address some of your most pressing concerns. To talk to a Schwab investment professional about your particular circumstances, please call 800-435-4000.

Rob Williams.

Where's the best place to put my cash if I'm looking for safety, high return and liquidity?
Unfortunately, it's tough to find safety, liquidity and high return all in one investment these days. Safety and liquidity alone are fairly straight-forward—Treasury bills or money market funds come to mind. But yields on both are quite low, approaching zero for the shortest-term Treasury bills.

For ample liquidity and competitive returns, you might look to an interest bearing checking or savings account. They're FDIC-insured up to certain limits, and the rates for many recently have been higher than the very low rates offered from T-bills and most money market funds.

You could also turn to a ladder of three-month to one-year FDIC-insured CDs. However, you'll lose a little bit in liquidity if you need to sell, and your cash access may not be immediate—not the best choice for daily spending needs. Shop for the best rate, and consider whether you're being adequately compensated for the lower liquidity compared to an interest bearing checking or savings account.

How do I invest cash at this time?
It's hard to beat many interest-bearing checking or savings accounts right now, which generate competitive returns and provide immediate liquidity. Checking accounts also provide check-writing privileges.

For potentially (though not always) higher returns with less liquidity, consider CDs or a purchased money market fund. For CDs, the price if you need to sell or cash-out before maturity depends on market conditions or pre-determined penalties. For purchased money market funds, you’d need to wait until the next day for access to your funds if you sell before 4 p.m. ET on the day before; and returns will vary.

Others investments, like ultra-short or short-term bond funds, may generate slightly higher returns, but they also carry the risk of a drop in share value. They shouldn't be substituted for cash or other cash investments for ultimate safety of principal. You won't have immediate access to your cash, but like a purchased money market fund, you can sell shares to have access to your funds the next business day.


Should I consider putting cash into a money market fund or a CD at this particular time?
It depends, partly, on when you need the cash, as well as available rates. CDs are generally meant to be held to maturity. You should be able to sell before maturity if you need to, but the price depends on market conditions (or pre-determined penalties), and there's no guarantee you'll receive your original investment in full.
 
Purchased money market funds commit to maintaining a $1 per share value, so you can be reasonably certain you'd be able to access your funds the next business day, after you choose to sell, at a definite price. But yields on purchased money-market funds have been quite low.

For higher returns and liquidity, consider the yields offered on interest-bearing checking or savings accounts as well. If you don't think you'll need the cash immediately, longer-term CDs may also offer competitive returns for the trade off in lower liquidity if you need to sell.

Note also that CDs offer a fixed return over a fixed period of time; money market funds, interest-bearing checking accounts, and savings accounts have rates that change depending on market conditions. If interest rates rise, the promised rate on a CD may be less competitive. If rates drop, the promised rate could end up being a good deal compared to the alternatives. Right now, interest rates are near record lows.


Where should I keep my emergency fund?
If you’ve saved between three and six months' worth of living expenses, you've gone a long way toward cushioning yourself against unforeseen emergencies. But where should you put your funds? While tempting, under your mattress is probably not the best option.

We recommend you invest emergency funds in relatively liquid cash investments that you won't have to worry about and that aren't likely to decrease in value. Some options to consider:

  • Interest bearing checking or savings accounts.  Many are delivering competitive yields (compared to alternatives) and allow easy access to your cash. Bank deposits are FDIC-insured up to $250,000 per person at a single institution through December 31, 2013.
  • Purchased money market funds. These funds are liquid and have historically provided a competitive yield. Current rates are quite low, but would increase if interest rates rise. And the managers are committed to maintaining your principal investment.


Important Disclosures
1. The temporary increase of FDIC insurance coverage to $250,000 for all insurable capacities has been extended through December 31, 2013. If not further extended, FDIC coverage will revert to $100,000 on January 1, 2014 for all insurable capacities except IRAs and certain other self-directed retirement accounts and plans. Unless the increased coverage is extended, deposit insurance coverage for CDs with a maturity date after December 31, 2013 will revert to the prior FDIC coverage on January 1, 2014, regardless of when you purchased the CD. You should not rely on a possible extension of this increased coverage in purchasing CDs.

Investors should consider carefully 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.

An investment in a money market fund is neither insured nor guaranteed by the FDIC or any other government agency. Although the fund seeks to preserve the value of your investment at $1 per share, it is possible to lose money by investing in the fund. Please note that bank deposits are FDIC insured up to $250,000 while nonbank independent products have no such guarantees.

Certificates of deposit are offered through Charles Schwab & Co., Inc. CDs from Schwab CD OneSource are issued by other FDIC-insured institutions, and are subject to change and system access. Unlike mutual funds, certificates of deposit offer a fixed rate of return and are FDIC-insured. There may be costs associated with early redemption and possible market value adjustment.

The information provided here is for general informational purposes only and should not be considered an individualized recommendation or personalized advice. The strategies mentioned here may not be suitable for everyone. Each investor needs to review their portfolio strategy carefully for his or her own particular situation before making any decisions.

Data contained herein from third party providers is obtained from what are considered reliable sources. However, its accuracy, completeness or reliability cannot be guaranteed. Please be sure to research this information further before making any decisions as the rules and restrictions described are subject to change in reaction to shifting market conditions.

The Schwab Center for Financial Research is a division of Charles Schwab & Co., Inc. Brokerage products offered by Charles Schwab & Co., Inc., are not FDIC insured, are not deposits or guaranteed obligations of a bank, and are subject to investment risk.


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Are You Gambling With Your Retirement?

by Natalie Pace.

Three Signs of a Losing Hand. Includes a Dow Vs. NASDAQ Stock Report Card.

Americans danced with delight this summer as their cracked nest eggs began showing new life. President Obama and his financial team (Chairman Bernanke and Secretary of the Treasury Timothy Geithner) glow with pride while claiming that, thanks to their swift, intelligent actions, disaster has been avoided. However, rather than be relieved by the latest propaganda of the Politicians in Chief, it is critically important that you take this opportunity to get a better plan, so that you never have to experience this train wreck again.

Talking heads are quick to note that "the markets" have rebounded 45% off of their lows of March 2009, when the Dow Jones Industrial Average bottomed out at a 12-year low of 6547. But that statistic is deceptive and dangerous, if investors think they are now sitting pretty with a winning hand. The Dow Jones Industrial Average, where many legacy corporations with pension plan debt are listed, is up only 5% on the year and is still down 33% since its high on October 9, 2007 of 14,164. NASDAQ, where the younger companies tend to list, is up a whopping 25% on the year, but is still 60% lower than it was at its high of 5,060.34 on March 10, 2000.

Wall Street Highs/Lows in this Millennium:

Index

Low

High

Dow Jones Industrial Average

6,547 (3.9.09)

14,164 (10.9.07)

NASDAQ Composite Index

1,114 (10.9.02)

5,060.34 (3.10.00)

 

There are two economies operating in the U.S. right now – consisted largely of companies that were founded before 1980 and those founded thereafter. Companies founded before 1980 promised a pension plan and health care to their employees. Corporations made this promise when the average age of death was 64, the average age of retirement was 65, there were 7+ workers for every retiree and health care benefits were a grain of sand compared to today’s costs. Corporations founded before 1980 are struggling to keep their promises, and the only solution to continuing operations while supporting such a large pool of non-working former employees in a competitive worldwide marketplace, is to take on massive debt.

In these two distinctly different economies, there are four very noteworthy trends. One: NASDAQ and the DJIA operate very differently. Two: recovery is slow in the wake of the bubble bursting. (After almost a decade, NASDAQ is nowhere near to its former glory.) Three: NASDAQ is hot in 2009 (and going forward), while the DJIA is still the home of the Bailout Index. And 4: finally, if you aren’t properly diversified and rebalancing annually, you’re missing out on the gains of the booms and getting flattened by the busts.

AIG, Bank of America, Citigroup and General Motors were all components of the leading Blue Chip Index (the Dow Jones Industrial Average), meaning they were likely the yolk of your nest egg over the last few years. BofA is still in the DJIA! With only 30 components in the Dow Jones Industrial Average and four rotten apple bailouts in the basket, that means that the person picking the companies for the index is either 1) not very good at math, or 2) that other criteria (cronyism economics) is at play in the selection process. General Motors was still a component of the Dow Jones Industrial Average in January of 2009 – at a time when GM’s debt, pensions and OPEBs topped $100 billion, Secretary of the Treasury Hank Paulsen had issued $13.4 billion in emergency loans to the corporation, and executives had already engaged bankruptcy attorneys, in anticipation of the inevitable.

If you want to avoid that losing hand, it’s as easy as reading your cards (in this case the Stock Report Card™) and knowing what you own in your 401(k), IRA, annuity, pension, et al. In addition to proper diversification and annual rebalancing (and overweighting NASDAQ), the three critical elements you must consider are:

  1. Was the company founded before 1980?
  2. Massive Pension and Other Post Employment Benefits (OPEBs)
  3. Massive Debt

As a society, we’ll have to figure out what to do about these unkept pension and OPEB promises, but as an investor, you need to be aware of the cards you’re holding and whether or not you want to bet against a bailout. Yes, the corporations made the promises, but the world shifted beneath their feet. National health spending is expected to reach $2.5 trillion in 2009, accounting for 17.6 percent of the Gross Domestic Product (source: The National Coalition on Health Care). There are now fewer than four workers for every retiree. Pension and OPEB obligations have forced U.S. airlines and auto manufacturers to operate at a loss and at a competitive disadvantage to foreign companies. Almost all of the U.S. car companies and legacy airlines have entered Chapter 11 bankruptcy restructuring, and there are other legacy corporations that will start encountering this issue more and more going forward.

Many of the younger, NASDAQ companies have the benefit of employee-managed 401(k)s, and this is a huge competitive advantage. Additionally, however, the prevalence of information technology products and services is another area of strength. According to Howard Silverblatt, the Senior Index Analyst at Standard and Poors, "Information Technology has gained 35.42% year-to-date, representing almost half the gain of the S&P 500." West Coast based, cash-rich companies like Google, Apple and Microsoft are profitable, increasing sales and carrying no debt at all, compared to the beleaguered East Coast giants of the last century. Click to access the Dow Vs. NASDAQ stock report card to see the vast difference between debt and profits of these two different corporate structures.

Publicly traded companies are required by the Securities and Exchange Commission to list their debt, pension liabilities and Other Post Employment Benefit Obligations on the earnings report. Scouring the earnings reports for this information is almost a breeze when you power search on the key words "debt, obligation, liability, liabilities, net income, OPEB and pension" using the "find" function. Sometimes, but not always, this information will be found in the press release that accompanies an earnings report.

If you own just a few mega-mutual funds, chances are you were dealt a losing hand without ever knowing it, since the Dow Jones Industrial Average components tend to be the most widely held companies on Wall Street. Now is the time to look at your cards, place your investments on winning hands and sing all the way to the bailed out bank. Healthy, prosperous Americans will have an easier time pushing this economy toward recovery than bewildered, busted and bushwhacked investors.

As further illustration of the efficacy of this information, using these strategies, I warned investors to get Fannie Mae out of their retirement plan as early as 2003, about the General Motors implosion in 2004, that real estate was poised to fall in 2005, to avoid faded blue chips and Lehman Bros. in 2006. On the other hand, subscribers knew to invest in such winners as Google at the IPO, Taser International (up to 9000% gains), Opsware, MySpace, Rio Tinto and more for outstanding gains. (Click on the highlights to access the original articles.)

It’s not hard to apply this wisdom. It does require opening your brokerage statement, and understanding that the information you really need to make informed decisions about your retirement plan is not found on free TV or in investment brochures. It is in the unreported, but publicly available data. These critically important considerations -- the amount of debt and OPEB liability that the company has – don’t negatively impact earnings or price to earnings ratio until it’s too late to do something about it.

See the article in this ezine, entitled "A Must Read Financial Bible" for additional key commandments to making gains in your nest egg in the U.S. today. Buying and holding mega-mutual funds is a losing strategy and has been for the last decade. Modern Portfolio Theory, diversified Exchange Traded Funds and annual rebalancing are easier than Black Jack, and are the only way to get the winning hand on Wall Street.

 

About Natalie Pace:
Natalie Pace, is the author of Put Your Money Where Your Heart Is and CEO of one of the most respected, independently owned financial news corporations in the U.S. She has been ranked as a #1 stock picker from TipsTraders.com and has partnered content with
Forbes.com, Sohu.com, Kiplinger’s Personal Finance and more.  She has appeared on Fox News, Good Morning America, CNBC, Time Magazine, More Magazine, USA Today, NPR and national radio shows. Ask her your money questions on her weekly radio show on BlogTalkRadio.com/NataliePace! Follow her on Twitter.com/NataliePace, YouTube.com/NataliePaceDOTCOM and Facebook.com/NatalieWynnePace. For more information please visit, http://www.nataliepace.com
.

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.

.


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Investing in a Bankrupt Company: A High Risk Venture.

Finra.org Investor Alert.

The SEC and FINRA are issuing this Alert because we believe there may be widespread misunderstanding by investors that own stock in the "old" General Motors Corporation (now known as Motors Liquidation Company) as related to the "new" General Motors Company (new GM). FINRA halted trading in old GM (which had been using the GMGMQ trading symbol) on July 10, 2009, and has since issued a new ticker symbol for the old GM stock—MTLQQ—to avoid having it confused with the new GM, which currently has no publicly traded securities.

This Alert also reminds investors that holding shares of any company involved in bankruptcy, or buying shares in a bankrupt company in the hope that those shares will surge in value down the road, are highly risky courses of action.

Furthermore, as with the GM situation, companies in bankruptcy are often the subject of rumors in fax or email newsletters, Internet message rooms or on Web sites offering online stock tips. Unfortunately, investors may have received confusing, potentially misleading, information about the old GM. As recently as last Friday (July 10, 2009), newsletters and other promoters have touted the purchase of the stock.

Two Distinct Companies
Motors Liquidation Company and the "new" GM are separate and distinct. As stated on the Web sites of both Motors Liquidation Company and the new GM, the new GM currently has no publicly traded securities, and none of Motors Liquidation Company’s publicly owned stocks or bonds are or will become securities of the new GM. Motors Liquidation Company is currently winding its way through bankruptcy court—and there is a real possibility that stockholders will receive nothing from these proceedings. While the common stock of Motors Liquidation has not been cancelled, investors should not interpret that as indicating the shares have any value.

"Q" is for Caution
Investors are often confused by the fact that, despite the likelihood that the common stock of a bankrupt company will be cancelled, the company's securities may continue to trade after the company has filed for bankruptcy protection and before it emerges as a newly reorganized company. This confusion may be aggravated by the lengthy bankruptcy process—which may take months, if not years. Such securities typically trade on either the OTCBB or the Pink Sheets and the stock symbol will have a fifth letter "Q" at the end to denote the company’s bankrupt status.

Risks of Trading in Securities of Bankrupt Companies
When a company files for reorganization under the federal bankruptcy laws, investors are often tempted to buy or hold the company’s common stock in anticipation that the company that emerges from bankruptcy will be profitable. The reality is, however, that when companies emerge from bankruptcy, the common stock of the "old" company is usually worthless. In most instances, the company's plan of reorganization will cancel the existing equity shares.

In general, while a typical bankruptcy reorganization plan allows the "new" company to distribute new shares under a new trading symbol, holders of the common stock of the "old" company generally do not receive any of these shares. A company must pay off existing debt before it emerges from bankruptcy—and creditors, including bondholders, usually receive shares in the new company as partial payment. This leaves little or nothing of value for the common stockholders of the "old" company. This may seem unfair, but it reflects the established priority scheme of bankruptcy and the fact that, in contrast to bondholders, common stockholders take greater risk, but have the potential for the greater gain. For more information on the corporate bankruptcy process, see the SEC’s brochure entitled Corporate Bankruptcy.

We are concerned that some investors purchase shares of companies in Chapter 11 bankruptcy in the belief that if the company survives, the old common stock will have value—not recognizing that the old common stock is likely to be cancelled, even if the company emerges from bankruptcy. Investors should understand that buying common stock of companies in Chapter 11 bankruptcy is extremely risky and can lead to financial loss.

If you own shares in a company that has, or may be filing, for bankruptcy, or are considering purchasing shares of a bankrupt company, check the company’s Web site for information about the bankruptcy. Also check the company’s SEC filings, available through the SEC’s EDGAR database or on the company’s Web site, and other publicly available information for company statements about its reorganization plan as well as a copy of the reorganization plan itself. For more information on using EDGAR and where to find information on a company’s bankruptcy, see Researching Public Companies Through EDGAR: A Guide for Investors.


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Union Power in the Obama Administration.

by Dr. Gary S. Becker.

Gary Becker

The major American trade unions, including the United Automobile Workers, the United Steelworkers, and the Service Employees International Union, went all out in their support of Barack Obama during the past presidential election. They supplied money-said to exceed $400 million- and hundreds of thousands of volunteers working for Obama. It is believed they were important in his winning industrial states like Michigan, Wisconsin, Ohio, and Pennsylvania.

Naturally, unions expect some payback after the resounding victory of Obama, as all interest groups do when the candidates they support win. Unions are behind the Employee Free Choice Act introduced in Congress early after Obama's election. That Act would make it much easier for unions to be certified to represent the employees of a company. The Act, still bogged down in a divided Congress, would allow for open rather than secret voting on whether a union should represent the employees, and would mandate arbitration over union-management contracts. Because of opposition from some Democrats as well as almost all Congressional Republicans, it is not yet clear how much the legislation that eventually emerges will shift union-management relations in favor of unions.

The bailouts of General Motors and Chrysler have been a second major effort to help unions. In this case, the Obama administration spent tens of billions of dollars of taxpayer revenue to help these companies. I expect total Federal spending on GM and Chrysler will eventually equal or exceed $100 billion. The best alternative to the bailout of these auto companies would have been to allow them to enter bankruptcy proceedings in the fall of 2008 when they were bleeding large losses. After a year or so in bankruptcy they would likely have emerged with considerably lower obligations for health and pension benefits, and reduced hourly earnings of their employees. They might then have competed without additional support against foreign auto companies with plants in the US or abroad.

Instead of allowing such bankruptcy proceedings to occur, and in order to reduce the hit that unionized autoworkers would have to take, GM and Chrysler were bailed out generously, and the federal government in effect became the principal owners of these companies. Although GM and Chrysler were allowed to go into bankruptcy for a short period, in my judgment the main aim of the bailout was to reduce the effect of the financial troubles these companies were having on the earnings and fringe benefits of present and retired autoworkers. Taxpayers paid what the autoworkers should have paid.

Perhaps the most disturbing tilt toward catering to union interests is the very recent 35 percent tariff the US government imposed on imports of Chinese tires without any finding of illegal trade practices by either the Chinese government or Chinese tire manufacturers. The White House under special trade rules can impose punitive measures without finding any "fault". However, this is the first time any president of the United States has used this provision to penalize manufacturers of imported goods or services. It is not only a terrible precedent, but also this may encourage other countries to follow similar procedures, and impose tariffs on US exports that unions and companies in these countries feel are hurting them.

Unions and their allies have succeeded in placing Buy America provisions in the $787 billion stimulus package, against the objections of many foreign countries. Unions are also active in trying to get similar provisions in the cap and trade climate bill that will eventually be passed by Congress and supported by the president. Buy America provisions to stimulate employment of American workers is no different than imposing tariffs to cut imports and increase demand for domestic goods. Both are inconsistent with the goal of free trade, and invite retaliation by other nations.

Politics in democracies allows powerful political interest groups to influence legislation in their favor. In that respect, the steelworkers and other unions are not doing anything differently than, for example, medical insurance companies or auto companies, try to do. But recognizing that this is the way the political process works does not mean that the effects tend to raise the general welfare of the population, as opposed to the welfare of small powerful interest groups.

In this regard, note that non-governmental unions contain only about 8% of the civilian labor force. This means that the benefits they receive from flexing their political muscle under the present White House mainly hurts other workers and consumers. In particular, the tariff on tires will raise the cost of tires to American consumers and make them worse off. Similarly, the bailout of the auto companies will raise taxes and probably also auto prices, and Buy America provisions will make the cost of goods more expensive because they cannot be obtained from cheaper foreign producers. The overall impact of these steps is a less efficient American economy, and substantial harm imposed on American consumers and non-union workers.

 

Dr. Gary Becker is a University Professor, Department of Economics, and Sociology Professor, Graduate School of Business, The University of Chicago. He won the Nobel Prize in Economics in 1992 for his groundbreaking work in "human capital."

 

To keep track of Dr. Becker's continuing research and commentary, visit his web site and blog. To hear more of his research and recommendations for strengthening the U.S. economy, check out the 2009 Milken Global Economic Conference web page. Dr. Gary Becker has been a keynote speaker at the conference every year since it began and spoke at two of the luncheon keynotes in April 2009.


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A Must Read Financial Bible.

by Staff.

Get answers to your 12 most pressing investing questions.

If you are tempted to go all in on gold, guns and ammo right now, you’re just as vulnerable as you were in 2005 when you thought real estate was the next mother lode.

Smart investors own stocks, bonds, real estate and gold, and rebalance their positions annually, in order to capitalize on gains and seize low-priced investment opportunities. The truth is that all of these assets perform well when you take a balanced, inclusive approach. (See the chart below for annualized returns for the last 40 years on real estate, stocks, bonds and gold.)

 

Put Your Money Where Your Heart Is provides a novel approach that has worked for the last decade – through bull and bear markets. In these pages, lie real answers to your 12 most pressing investment questions. The solutions to a boom/bust, slow-growth economy are easy-to-understand and easy-to-implement, and they work in marketplace where buying and holding strategies have failed.

Here is what readers are saying:
Put Your Money Where Your Heart Is is a "must-read financial bible," and "just what some readers may need to find themselves exponentially richer in the coming years."

Over 55% of the Amazon.com book reviews are 5-star.

More important than the reviews, however, are the results. Bill and Nilo Bolden haven’t lost anything. The Green Goddess Investment Club made 47% gains in the last 12 months, using Natalie Pace’s market updates and Hot News reports. (There are more success stories are listed at the end of this article).

Answers to your 12 most pressing investment questions
1. How can you tell the difference between a good investment and a bad investment? The Get Educated section of the book features the 3-ingredient recipe for cooking up profits in any asset (real estate, stocks, gold, Beanie Babies, Lladro, classic cars). In that section, you’ll learn about the Stock Report Card™ and the Four Questions for picking the star investment of an industry.

2. What boxes should I check off in my 401k? See page 92 for Natalie’s Easy as a Pie Chart diversification strategies. Learn more about why you need to diversify by size (small, medium and large cap), style (value and growth) and to have funds in hot industries in the sections "Get Involved" and "Get Savvy".

3. Why is GM bankrupt and Google so hot? Is there a way to identify the winners and losers before I lose all my dough? Chapters 5, 6 and 15 outline easy strategies for picking the Googles of the world and avoiding the GMs. In fact, chapter 5, "Hitch Your Wagon to a Star," uses General Motors and Google to illustrate the difference, and was written in 2007, a full two years before General Motors declared bankruptcy. A savvy investor can see the problems years before calamities occur.

4. How much do I keep safe? Keeping a percent equal to your age safe, i.e. not invested in stocks, is a central theme that is stressed throughout the book. That is what differentiates this financial Bible from those written by other authors in the past. This strategy alone, which is based upon Modern Portfolio Theory, would have saved investors twice in the last decade – during the DOT COM bust and the 2008 Bank Bailouts. Chapter 17 outlines the Top 11 Most Common Investing Mistakes.

5. How can I win on Wall Street when even banks are bailed out? Chapter 3, entitled "Put Your Money Where Your Heart Is," elucidates how blind faith investing means that cronyism economics flourishes, whereas investing in companies making the best products and services means that companies are forced to compete for your investing dollars. If you were doing this, you’d be invested in companies that are still healthy and would have avoided the Bailout Index. Over 10% of the leading blue chip index was bailed out in 2008-2009.

6. How can I invest in a cleaner, greener world? Interested in green and/or socially conscious investing (Chapter 11)? The good news is that clean energy was the top performing industry in 2007 – with almost twice the returns of oil, returning roughly 60 cents on the dollar. Like the Internet bust of 2001-2002, however, 2008 punished green investors. Learn important strategies for emerging technologies, so that you can get rich, while you enrich.

7. I’m interested in starting an investment club. What do I need to know? Chapter 12 can help you with everything from who should do what, to what kind of agreement you should sign, and where to get your tax ID number.

8. How do I avoid the Bernie Madoffs and Enrons of the world? Chapter 14 devotes 13 pages to Lessons from Enron – many of which would have saved you from Madoff and the future Madoffs and Enrons, as well.

9. Buying and Holding mutual funds isn’t working for me. My retirement plan is worth less this year than it was ten years ago. Is there a better strategy? Yes, there is! "Buy and Hold" only works in a robust economy. We’ve had a boom/bust economy that is lower in 2009 than it was in 1999. So, the only thing that works in that environment is Modern Portfolio Theory, ETFs and annual rebalancing. Believe it or not, this is easy-as-a-pie chart, which is outlined in chapters 7 and 8.

10. How can I pick a great broker? Brokers are salesperson, not surgeons, so it pays to know the ten questions you need to ask to find the perfect Certified Financial Life Partner. See Chapter 9 to learn why: Brokers and lovers, it pays to pick a good one. Interview your CFP like your life depends upon it because your lifestyle does.

11. I’m drowning in bills! How do you even find money to invest and why would I when Wall Street is bailed out? Most people are drowning in debt and bills because they are over-spending on basic needs. Cutting out caffe lattes isn’t really going to help. The Thrive Budget on the other hand is an excellent way to get your survival spending in shape and start investing in the life of your dreams. Read Chapter 8: The Billionaire Game.

12. I’m always late to the table. China, real estate, Internet – I always buy in at the top (and then have to watch my investment crumble). How can I buy in earlier and capture my gains at the top? Chapter 20, entitled "Happy People Make Better Products Faster, Cheaper," was written to explain how Natalie has had such success picking emerging countries, markets and companies. Learn how she picked China in 2002, Eastern Europe in 2004, copper and Rio Tinto in 2004, Google at the IPO, Taser International before it scored 9000% gains and more!

And here are the results of everyday people who read the book and/or attended a 3-day Get Rich and Enrich Retreat with Natalie Pace:
"Natalie Pace's sound strategies, helped me avert a huge loss on my 401k plan. Moving my money to a safe place saved me thousands when the market plummeted." Nov. 2008. Nilo Bolden, Law Firm Administrator. Nilo and Bill Bolden made the decision to use Modern Portfolio Theory, diversification and annual rebalancing as their strategy at the onset of the 2008 recession.

"Natalie talked to me about living in a place that speaks to my soul.  As she said these words, it was clear to me that Venice is that place, but I felt I could not make the move back to Venice once the prices had gotten so high.  After 6 years, I had basically given up and stopped looking, because I was not comfortable putting money into the move.

Months later, I was able to negotiate a contingency offer and to sell my house for more money than the house I wanted to buy.  The extra money paid for most of the realtor’s commission.  I left a one-story house for a 2-story house.  I left an 1100 sq. ft. house for an 1850 sq. ft. house, part of which will be a rental for income.  I left a 2-car garage for a 4-car garage (painting studio).  One bath for two. A drive to the beach for a bike ride to the beach.  My best painter friend, Linda, lives back-to-back with my new house.  I see both of our art studios from my bedroom window each morning!" Eva, artist

"Since attending Natalie Pace’s Nov and Feb retreats, I've been applying the concepts and with the Stocks on Steroids I’ve earned and built up $64,000, for 53% gains, in under six months.  My broker managed to lose $100K in a year."   Rita, semi-retired school teacher, age 66

"I started with $100K from the 401K rollover I executed in my Santa Monica hotel room during Natalie's investor retreat, and with profits from stock trades, dividends, and money market interest, I've got it up to around $124K." Christina, artist

"When I first met Natalie Pace I was desperately trying to stay afloat with my financial situation.  My nest egg was half of what I had previously invested, I was in a negative cash-flow real estate investment, clueless about how to truly purchase stocks correctly, and my budget was as whimsical as a musical.  She truly has been a blessing in my life to not only help teach me how to shift my financial situation but to also inspire me to create an investment club in order to help my friends and family.  I'm still astonished that what I once viewed as hieroglyphics is now something others ask me to mentor them on.  Natalie is truly a financial angel.  P.S. My boyfriend loves her book!"  -- Brianna Brown, actress

"The first Natalie Pace stock report card seemed oddly easy to do, as if I must have been doing it wrong. Because of Natalie's wealth of knowledge and experience, our family is facing in the right direction as we learn to make financial decisions for our future. Oh and last, but not least... I am having a lot of fun!" Kavi, actress

"With the valuable guidance of our mentor Natalie Pace we out performed the bear market with the extraordinary result of 48% GAINS!!!!!!"  Cindy Ciscowski, President, Green Goddess Investment Club.

"I have made enough money my fist week to pay for my trip, Thanks!"  Randall Book, November 2008 Natalie Pace Retreat Attendee

"Each and every stock that you have recommended and in which I invested, I doubled my money...only wish I had invested more." Tushar Mathur, blogger, Sept. 2009

"You make the world a much better place for all of us." Bryan Zee

 

Here is what economists and CEOs are saying:
"Her excellent advice about how to allocate one’s monthly budget with what she calls a "Buy My Own Island Plan" is an important component of achieving economic security and wealth at older ages. She also advocates considerable amounts to be set aside for basic needs, education, charities, and fun things to do. This may seem obvious, but many people, including educated men and women, need help in making such basic allocations of their resources. They often get into trouble when they neglect to follow simple and fundamental rules of the type provided in this book. This is why I recommend it with enthusiasm." Dr. Gary S. Becker,. Dr. Becker won the 1992 Nobel Prize in economics. He is a University Professor, Department of Economics and Sociology and Professor, Graduate School of Business, The University of Chicago.

"Nobody cares more about your money than you do. Natalie does a terrific job of explaining how and why you should be taking more responsibility for your own financial well being." Joe Moglia, Chairman, TD AMERITRADE

Martin Samler, the Chief Investment Strategist of TipsTraders.com, awards Ms. Pace the distinctions "Top Stock Picker 2006, 2007, 2008 and 2009" and "Highly Recommended." Mr. Samler says that her distinction is awarded "for the unique and value-packed combination of financial articles with Natalie Pace's unmatched skills in picking stocks across industries and markets." In 2005, Natalie achieved the number one ranking, above over 830 stock pundits followed by Mr. Samler.

 

Read Put Your Money Where Your Heart Is: Investment Strategies for Lifetime Wealth. By Natalie Pace.

If you are interested in booking Natalie to speak to at your conference or to host a Get Rich and Enrich Retreat for your group, call 866.476.7442 or email Info@NataliePace.com.


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Living in Faith, Not Fear.

by Chellie Campbell, author of Zero to Zillionaire and The Wealthy Spirit.

"I live happily each day in joyful expectation of positive outcomes!" 

Chellie Campbell

Ahhhh. That one feels good, doesn’t it? You know who made up that affirmation? Me. I had forgotten it, but I signed up to receive my own daily inspirational emails from The Wealthy Spirit and found it again (For those of you who have the book, it’s on Day #228).

I do over 100 affirmations most days. Sometimes I get bored, or stuck, or I read too much bad news that day, or I get more "nos" than "yeses" or some shark attacks me and then somehow the affirmations turn into desperations and yikes! I’ve got to regroup, slap myself, and snap out of it.

I look for new truths, new energy, and new positive statements to help create my day the way I want it to go. So it’s pretty funny when the new affirmation I’ve been searching for shows up in my in-box and it’s one I already made up!

I posted this one on a yellow sticky on my computer so I can be reminded each day that I’m either operating from fear or faith. Everything is faith though, isn’t it? Fear is just faith in bad things happening. You can find proof of that if you want to, but I’d really rather find happy things to believe in.

A Chinese philosopher said it this way: "This season is my best ever, this year is my best year, this moment is the best moment."  

Try it. Radiate joyful energy and the positive expectation of joyful news. Share your smiles and good energy with others. And then watch what happens!  

Cheers,
Chellie 

 

About Chellie Campbell:
Chellie Campbell is a Professional Speaker and Author of The Wealthy Spirit and Zero to Zillionaire 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 40 popular books.

 


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Natural Solutions to Toxic Build Up.

by Julie Gengo, HealthWalk.com.

Cleaning Supplies You Can Live With.

Toxins, toxins, toxins. We often hear about the abundance of toxins in our environment, chemical cleaners and solutions, food supply and beauty products. These superfluous and perhaps unwarranted chemicals may be one of the reasons why many of us are experiencing health issues. Avoiding these toxins can be complicated and confusing since many are hidden, not well tested/documented or not tested at all. As a result these toxins are allowed into our lives with inaccurate or no information on their safety.

When toxins enter your body from inhalation, food or skin contact, they find their way into your blood stream and most end up in your liver. Unfortunately the body’s cells absorb some of the toxins bypassing the liver all together. These toxins can damage and change your DNA leading to serious diseases, including cancer.

Your liver is designed to cleanse the body of toxins and other unnecessary elements. However, with an overload of toxins, the liver can get clogged affecting bodily functions, including cholesterol levels, in a negative way. Other symptoms may be physical and mental fatigue, rashes and other allergy symptoms, loss of concentration, premature aging, insomnia and lowered immune system to name a few.

One thing you can do to eliminate toxins in your body is to detoxify and strengthen your immune system with healthy foods and natural supplements. At HealthWalk our functional nutrition counselor integrates functional endocrinology, serum and blood based biomarkers analysis to determine your specific needs. Vital Hematology live blood analysis can show what is in the body so that we can recommend holistic solutions to boost your immune system and to support your health and wellbeing.

It is also advisable to incorporate preventative measures to limit the toxins that you have control over. Reduce the consumption of all packaged foods; they are filled with preservatives, flavor enhancers and other chemicals that are often detrimental to health.

Another simple way to avoid toxins in the home and office is to use environmentally friendly (free of harsh chemicals) cleaning products. A way to reduce costs and use these products is to make your own.

Below are recipes that you can make using simple commonly available ingredients.

ALL PURPOSE CLEANSER
2 cups hot water
1 tsp. biodegradable liquid soap or borax
1 tsp. white vinegar or lemon juice (to cut grease)

Fill spray bottle with hot water. Add soap and vinegar or lemon juice. Shake bottle gently to dissolve ingredients.

SHOWER/BATH CLEANSER
2 cups hot water
1 tsp. borax
3 tbsp. White vinegar

Fill spray bottle with all three ingredients and shake for 30 seconds. Keep bottle in shower and mist shower wall and door/curtain after each use. Helps prevent mold and mildew from developing.

GLASS CLEANSER
1-cup water
1/8 cup white vinegar

Fill bottle with both ingredients and shake for 30 seconds. Use on all types of glass surfaces including mirrors.

TUB & TILE CLEANSER
½ cup baking soda
Enough biodegradable liquid soap to make a frosting-like consistency
5-10 drops fragrant essential oil

Place baking soda in a bowl and slowly pour in liquid soap, stirring constantly, until the mixture reaches the consistency of frosting. Add drops of essential oil (optional). Scoop the mixture onto a sponge, wash surface and rinse.

TOILET CLEANSER
¼ cup baking soda
1-cup vinegar

Sprinkle baking soda into toilet basin followed by the vinegar. Allow mixture to sit for several minutes. Scrub with brush and rinse with water. A mixture of borax (2 parts) and lemon juice (1 part) will also work.

One tip: Try to use empty and clean spray bottles (previously filled with other ingredients) that you may have around the house to encourage the reuse of these items.

These recipes are courtesy of the Solana Center for Environmental Innovation. You may want to make a small donation and request that the Center send you the set of the colorful sticky labels, complete with recipes, so that you can easily identify your spray bottles and have the recipes at hand for refilling.

For more support and to establish a base line on your health and toxin level, come to HealthWalk. Our integrated health and wellness center is designed to help you identify your current health condition and to support you in boosting your immune system to rid the body of toxins and other impairments to vibrant health.

HealthWalk, the leading edge, non-invasive integrated healthcare center and products company, has specially priced Health and Wellness Products and Services for NataliePace.com subscribers. HealthWalk is offering 10% discount for NataliePace.com subscribers on all individual HealthWalk products and services. Please mention the discount code, HWNP upon ordering.

Call HealthWalk at 877-255-4703 or email info@healthwalk.com

www.healthwalk.com
HealthWalk, 5825Avenida Encinas suite 111, Carlsbad CA 92008

You can lose everything in life and make it all back - With one exception… Your Health

HealthWalk™ offers customized, non-invasive and effective support to enable your body’s own innate powers to regain and enhance health, performance and healing. HealthWalk is dedicated to supporting and empowering you to achieve and maintain vibrant wellness. HealthWalk is a non-invasive, integrative healthcare facility with a global umbrella of leading edge technologies, services, natural supplements and products backed by over 20 years of research. HealthWalk™ is based in Carlsbad, CA.

www.healthwalk.com
Phone 877.255.4703
info@healthwalk.com



October: Spooky or Sweet to Investors?.

by Natalie Pace.

Includes my Hot News on Cool Stocks List.

October 2, 2009

General Stock Market Performance

Wednesday, 1.3.2007

Monday, 1.2.2008

Monday, 1.2.2009

Monday, 10.02.09

Gains 3-yr, 2-yr & 10 mo.

Dow: 12,474.52

Dow: 13,044.12

Dow: 9,034.69

Dow: 9,487.67

-24% & -27% & +5%

Nasdaq: 2,423.16

Nasdaq: 2,609.63

Nasdaq: 1,632.21

Nasdaq: 2,048.11

-15% & -22% & +25%

S&P: 1,416.60

S&P: 1,447.16

S&P: 931.80

S&P: 1,025.21

-28% & -29% & +10%

 

Wall Street Highs/Lows in the New Millennium:

Index

Low

High

Dow Jones Industrial Average

6,547 (3.9.09)

14,164 (10.9.07)

NASDAQ Composite Index

1,114 (10.9.02)

5,060.34 (3.10.00)


Hot News on Cool Stocks Highlights!

532% gains on U.S. Gold!
NASDAQ Tops Gold Returns, With 25% Gains -- compared to +9% rise in gold prices and only +5% for the Dow Jones Industrial Average.
87% of the positions listed in 2008 & 2009 are in the money. Woo hoo!

TipsTraders ranked me #11, above over 830 A-list pundits, in 2008.

Market Update:
October has hosted the worst days on Wall Street.

October 29, 1929: Black Tuesday, the start of the Great Depression

October 19, 1987: Black Monday, 508 point drop in the Dow (22.61%)

October 9, 2002: NASDAQ bottomed out at 1,114 (almost 80% off of its high in March of 2000)

October 9, 2007 marked an all-time high of 14,164.53 in the Dow Jones Industrial Average – a bubble that slowly deflated over the next few months, as news of Bear Stearns’ $13.40 trillion exposure to risky investments began leaking to investors.

Lehman Brothers declared bankruptcy on September 15, 2008, but the markets continued to trade in the 11,000 range. By October 26, 2008, the Dow Jones Industrial Average had dropped to 8176.

And rather than ushering in Santa Rallies, the past two Octobers have been the beginning of horrible anti-holidays on Wall Street.

Performance of Dow Jones Industrial Average, NASDAQ and S&P500
October 1, 2007-January 1, 2008

 Performance of Dow Jones Industrial Average, NASDAQ and S&P500
October 1, 2008-January 1, 2009

Will there be another evil October surprise to ground the 2009 Summer Rally? Not if Federal Reserve Chairman Ben Bernanke has his way. "I was not going to be the Federal Reserve chairman who presided over the Second Great Depression." Federal Reserve Chairman Ben Bernanke said, at a Town Hall meeting hosted by The NewsHour with Jim Lehrer, on July 26, 2009.

Natalie’s Note: You can watch Ben Bernanke’s Town Hall Meeting of July 26, 2009. Access the link by clicking on Chairman Bernanke’s name.

As a reminder, Ben Bernanke and the Treasury Department (under former Treasury Secretary Henry Paulson) asked Bank of America to swallow a toxic Merrill Lynch, bailed out Bear Stearns, AIG, Citigroup and Bank of America, and did a lot more behind the scenes deal-making (such as with General Motors) in 2008 (before President Obama took office). Most of what went on is a complete mystery to shell-shocked Americans, who lost money on the bailout as investors and as taxpayers.

In October of 2008, when Lehman Bros. was forced to file for bankruptcy, Chairman Bernanke said TARP funding wasn’t in place and there was a $40 billion dollar gap that couldn’t be bridged. The landslide erosion of the stock market in the wake of the Lehman disaster -- the fall of the Dow Jones Industrial average to a 12-year low of 6547 on March 9, 2009 -- is something that the Treasury Department and the Federal Reserve will do anything to prevent again, no matter how toxic the corporation is. According to Chairman Bernanke, "[The Lehman Bros.’ bankruptcy] confirms what I’m saying: that if you allow a big firm to collapse in the middle of a crisis, the crisis to the average person, to the global economy, is severe."

"From 1929 to 1931, [the Great Depression] was a normal recession," Chairman Bernanke advises. "Then, in 1931, a huge bank in the middle of Central Europe collapsed and that created a global financial crisis, which then made the recession into the Great Depression."

Based upon these statements, it is fair to assume that Secretary of the Treasury Timothy Geithner and Federal Reserve Chairman Ben Bernanke are determined not to host another October 2009 disaster. "Too big to fail" will continue to be the policy choice du jour. It is less clear whether Bernanke and Geitherner have prevented the 2nd Great Depression, however.

While Bernanke and Geithner are busy monkey-rigging and duck-taping the banks, insurance companies and auto manufacturers back together, and telling the American taxpayer that their landmark investment in these corporations will be paid back with interest, Elizabeth Warren, Chairman, Congressional TARP Oversight Panel, is warning that taxpayers will see only $66 on every $100 invested in the bailouts. She also warns that Americans should be very concerned about the toxic assets that the banks still have on their books, and the commercial loans that are bound to become a big problem in 2010.

Ms. Warren warns, "Commercial mortgages come up for maturity in 2010, 2011 and 2012. The estimates out of Deutsche Bank are 50-60% default rates on these mortgages. This is a very serious problem, and one that will be concentrated in the intermediate and small banks because they hold a lot of these commercial mortgages."

What does all of this mumbo-jumbo mean to you?

It is critically important that you understand that buying and holding mega mutual funds doesn’t work in a slow growth economy, which is what the U.S. has been in since the beginning of this new millennium. The stock market is lower in 2009 than it was in 1999. Free, easy money has fueled numerous boom/bust cycles since 2000 – the DOT COM boom/bust, real estate, copper, clean energy and the Bank Bailouts.

Stock Market Performance 1999-2009

What does work? Modern Portfolio Theory, diversified funds (size/style and hot industries) and annual rebalancing. Using annual rebalancing, you would have captured 3X gains in NASDAQ at the beginning of 2000, and limited your exposure to the 70% percent NASDAQ losses that occurred between 2000 and 2002. Real estate doubled between 2002 and 2007, and clean energy earned 60 cents on the dollar in 2007. That means every $100,000 becomes $300,000 during NASDAQ’s boom period (such as between 1997 and 2000), or becomes $200,000 during the real estate rocket ship and, or becomes $160,000 while invested in clean energy in a single year -- 2007! There are big gains to be made in this brave, new world.

NASDAQ’s BOOM PERIOD (1998-2000):

REAL ESTATE’s BOOM PERIOD (2002-2005):

CLEAN ENERGY’s BOOM PERIOD (2007):

Modern Portfolio Theory, diversified funds (size/style and hot industries) and annual rebalancing are made easy-as-a-pie chart in my book, Put Your Money Where Your Heart Is. Readers say Put Your Money Where Your Heart Is is a "must-read financial bible," and "just what some readers may need to find themselves exponentially richer in the coming years." Put Your Money Where Your Heart Is is available wherever books are sold.

If you are interested in hosting a 3-day Get Rich and Green investing retreat for your friends or group, please call me at 866.476.7442 or email info@NataliePace.com. Groups like the Green Goddess Investment Club are reporting 47% gains over the last 12 months, using my strategies. "With the valuable guidance of our mentor Natalie Pace we out performed the bear market with the extraordinary result of 48% GAINS!!!!!!"  Cindy Ciscowski, President, Green Goddess Investment Club.

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. 79 positions listed below – 87% -- have delivered impressive gains over the past two years, even while the Dow Jones Industrial Average is trading lower than it was ten years ago! Only twelve of our listings went in the opposite direction of the reporting, which is quite impressive given the horrible market drop of 2008-2009.

Yes, many, but not all, of our top performers in 2008 and 2009 are shorts, which is why we added options training to the retreat. Remember that the trading portfolio should be equal to your experience, and should not be part of your nest egg. (The nest egg is money you earn while you sleep, not while you day-trade.) If you’re new, you should be using education or fun money, not your nest egg, to learn on. Take your profits early and often in these volatile, whip-sawing years.

3 out of 6 Company of the Year selections more than doubled.  My 2003, 2004 and 2007 Companies of the Year posted up to 9000% gains (Taser), up to 690% gains (Opsware) and up to 215% gains (Suntech Power Holdings), respectively, before we took them off of the list.  MySpace, my 2006 Company of the Year, was a large part of News Corp’s success with shareholders that year.   So three out of six are superperformers, and one (Myspace) performed well above the market. 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 and have consistently scored at the top of their 830 A-list pundits. I scored a #11 ranking for 2008. Some of my best picks include: Google (GOOG) +585%, Opsware (OPSW) +690%, Rio Tinto (RTP) +145%, Sohu (SOHU) +150%, Suntech Power Holdings (STP) +107%, Taser (TASR) up to 9000% gains. Some of the best picks in 2008 and 2009 were put options – on the Cooling Off list. Look there for details on the incredible gains options investors enjoyed on Wells Fargo, Fannie Mae, Toll Brothers, KB Home, Novastar Financial and more there.

This stock newsletter was the first to list the following 911 alerts:

  1. To get Fannie Mae and Freddie Mac out of your 401(k) in 2003
  2. Avoid General Motors and other American auto-manufacturers in 2004
  3. Get out of Dodge (real estate) in 2005
  4. Trim back on Faded Blue Chips in 2006
  5. Lehman Bros’ colossal insider selling in 2006

Market Movers:
The Federal Open Market Committee and Monetary Policy
The Fed funds rate continues to be "0 to ¼ percent." In the 9.23.09 meeting press release, the Federal Reserve Board further elaborated on the reasoning behind the rock bottom rates, writing: "Information received since the Federal Open Market Committee met in August suggests that economic activity has picked up following its severe downturn. ... Economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period."

That is Fed-speak for "We are doing everything to stimulate the economy, which should work eventually, but the situation is still rough, folks." Deflation is no longer much of a concern, and the Feds think that inflation "will remain subdued for some time," though some economists warn that this is a big bear to be considered once recovery really kicks in.

The Milken Institute estimates that the bailout to date has already cost the taxpayer $9.8 trillion.

The next FOMC meeting takes place on November 3-4, 2009.

Final GDP growth rates for 2Q 2009 were a decline of -0.7%, according to the Bureau of Economic Analysis. Final GDP growth rates for 1Q 2009 were a decline of -5.5%. The economy contracted at -6.3% in the 4th quarter of 2008. What happened between 2008 and 2009? Massive government spending is the main driver of the economy at this point.

Advance GDP growth for 3Q 2009 will be released on October 29, 2009 at 8:30 a.m. ET. These release days tend to be very active on Wall Street. The general consensus by economists is that the 3rd quarter of 2009 could be the first positive GDP report since the 4th quarter of 2007. For more BEA release dates, go to the BEA.gov website and be sure to visit the NataliePace.com calendar section often.

EDUCATIONAL OPPORTUNITES AND INFORMATION:
1. FOMC Information: Interested in reading the press release of the September 23, 2009 FOMC meeting for yourself? You can. The official Federal Reserve document is available online. Click on FOMC, or go to FederalReserve.gov to read!

The tentative FOMC meeting schedule for the 2009 calendar is: November 3-4, 2009 (Tuesday-Wednesday), December 15-16, 2009 (Tuesday-Wednesday), January 26-27, 2010 (Tuesday-Wednesday), March 16 (Tuesday), April 27-28 (Tuesday-Wednesday), June 22-23 (Tuesday-Wednesday), August 10 (Tuesday), September 21 (Tuesday), November 2-3 (Tuesday-Wednesday), December 14 (Tuesday), January 25-26, 2011 (Tuesday-Wednesday).

2. Calendar Section: Conferences, Online Chats and more: Check out the Calendar section of NataliePace.com regularly. Be the first to know the dates of the mid-month Hot News on Cool Stocks Update and the publication date of our next ezine. Join me on BlogTalkRadio.com. 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 Pace and Prosperity Show with Natalie Pace on BlogTalkRadio.com on Wednesday mornings at 9:00 a.m. PT. Get call-in and log-in instructions at BlogTalkRadio.com/NataliePace. This is a Q&A format, where you can call in or Twitter in your questions. Be sure to write down your most pressing questions now, and become a friend to Natalie Pace on Twitter at Twitter.com/NataliePace, so that you can Tweet on the show.

3. Survey Results: Each month we have three new surveys so that we can stay in touch with your needs and desires. Cast your vote on our survey page! What are your thoughts on the summer rally? We want to know! Is it the beginning of real recovery or a dead cat bounce?

4. Euro interest rates: ECB rates are at 1.00% (main refinancing), 1.75% (marginal lending) and 0.25% (deposit facility). The next meeting and interest rate announcement is scheduled for September 17, 2009 at 2:30 p.m. CET. (October 8, 2009 after that.)

Hot Stocks List
Investors who "never pay retail," note that the BOLD 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. (If the stocks are not highlighted, then in our estimation, this is not a good time to buy. Reasons are explained in the news commentary.) 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. And remember that these "Stocks on Steroids" are not intended to be part of your nest egg strategy at all – not even for "pros." If you’ve never traded individual stocks before, this is your "fun" or "education" money. You should not stake your future on anything that you don’t have mastery over.

Hot News List (highlighted).  Be sure that you are buying low.
American Superconductor (AMSC)
U.S. Gold (UXG)

Profit-Taking (Take your profits early and often):
HOKU Scientific (HOKU) +52%
KCI Concepts (KCI) +72%
LDK (LDK) +61%
New Zealand Dollar Currency ETF (BNZ) +34%
U.S. Gold (UXG) +532%

DELETIONS (Take your profits early and often):
None

HOT NEWS on COOL STOCKS LIST

Company NP owns? Symbol Price when featured

Price 10.02.09

Year High

Year Low

Gains since original feature

American Superconductor

Yes

AMSC

$30.70

$30.70

$37.58

$8.22

--

Read "The Sunny Side" Vol. 6, issue 3. AMSC should benefit from President Obama’s commitment to build a "a new smart grid to carry electricity from coast to coast."

1Q 2009 earnings on 7.30.09: Sales were up 83% in the 1st quarter over last year. Looking for a bad market day as a re-entry point. GAAP net income of $1.8 million, compared to a loss of $6.1 million a year ago. Cash, cash equivalents, marketable securities and restricted cash at June 30, 2009 were $103.2 million.

"A solid mix of wind power and power grid business fueled another record quarter at American Superconductor," said Greg Yurek, AMSC’s founder and chief executive officer. "We achieved a strong increase in power grid-related D-VAR® system revenue and our largest customer, Sinovel, requested delivery of additional wind turbine core electrical components during the first quarter to meet increased demand in China for its 1.5 megawatt wind turbines."

Signed new $100 million contract with Sinovel, China’s leading wind turbine producer, for core electrical components to be utilized in Sinovel’s 3 megawatt (MW) wind turbines, known as the SL3000.

Hoku Scientific

Hawaii

RISK: HIGH

Yes

HOKU

$8.03

$2.00

(3.2.09)

$3.04

$14.55

$1.90

-62% &

+52%

Read "The Sunny Side," Vol. 6, issue 3 and "Solar Giants Tap a Small Hawaiian Company For Silicon," in the Oct. 2007 ezine, Vol. 4, issue 10.

Hoku's key project schedule (based upon work resuming in October): completing a reactor demonstration in December 2009, completing construction of 2,500 metric tons of polysilicon production capacity in March 2010, and completing construction of the full 4,000 metric tons of capacity, including on-site trichlorosilane (TCS) production, in December 2010.

On September 29, 2009, Hoku confirmed that the $50 million in debt, plus prepayments from its existing customers, is expected to be sufficient to complete construction to the point where it could commence shipments to customers, and it intends to delay any additional financing until such time. On the basis of these funding sources, Hoku reported it is preparing to issue orders to resume full scale plant construction at an accelerated pace upon closing of the financing, which is expected to occur in October 2009.

You can see the facility’s progress on the home page at HokuCorp.com.

Kinetic Concepts, Inc.

No

KCI

$38.81

$21.05

(12.1.08)

$36.22

$43.00

$17.86

-7% &

+72%

Read the article, "Beauty is Skin Deep," in Vol. 5, issue 5. If you made a profit of 72%, take your profits early and often!

REPORTED 2Q 2009 EARNINGS ON 7.21.09. 2009: Kinetic Concepts, Inc. KCI today reported second quarter 2009 total revenue of $491.3 million, an increase of 6% from the second quarter of 2008. Total revenue for the first half of 2009 was $961.4 million, a 9% increase from the prior-year period. Net earnings for the second quarter of 2009 were $58.1 million, or $0.82 per diluted share, compared to a net loss of $4.8 million, or $0.07 per diluted share, for the same period of 2008.

Cash and cash equivalents: $235.3 million. Total long-term debt outstanding at June 30, 2009 was $1.396 billion on a GAAP-basis.

FDA approved ABThera™ Open Abdomen Negative Pressure Therapy System on June 11, 2009. The new therapy has already been launched, according to Catherine M. Burzik, KCI’s President and CEO. "I am very pleased to see the progress of KCI’s business in light of continued economic and competitive pressures," said Catherine Burzik, President and Chief Executive Officer of KCI. "KCI continues to meet its goals in terms of innovation, global market expansion and operational efficiency. We recently introduced our highly innovative open abdominal wound system, AbThera, to operating room surgeons in the U.S. and Europe and we are on track with our plans for the launch of V.A.C. Therapy in Japan. We look forward to the second half of the year with confidence."

KCI won its suit in the U.S. against Smith and Nephew to prevent them from selling foam dressing kits. On June 15, 2009, The Federal Court of Australia, Victoria District Registry, issued a temporary injunction prohibiting Smith & Nephew. Trial in Australia is set for 2010. UK issued a temporary injunction and the German courts are considering the same action as well. Smith & Nephew has vowed to appeal.

LDK Solar

GREEN

Yes

LDK

$30.02

$4.94

(3.2.09)

$7.93

$76.75

$3.75

-74% &

+61%

If you made a profit of 97%, take your profits early and often!

Read the articles, "Green" in Vol. 6, issue 2 and "Solar Springs Up Again," in Vol. 5, issue 4.

2Q 2009 earnings results (8.12.09): Net sales for the second quarter of fiscal 2009 were $228.3 million, compared to $283.3 million for the first quarter of fiscal 2009, and $ 441.7 million for the second quarter of fiscal 2008. For the second quarter of fiscal 2009, gross profit was negative $205.5 million, compared to $4.9 million for the first quarter of fiscal 2009, and $112.3 million for the second quarter of fiscal 2008. Loss from operations for the second quarter of fiscal 2009 was $235.0 million, compared to a loss of $16.1 million for the first quarter of 2009, and compared to income from operations of $100.3 million for the second quarter of fiscal 2008.

LDK Solar ended the second quarter of 2009 with $265.7 million in cash and cash equivalents and $123.0 million in short-term pledged bank deposits. Short-term borrowing commitments add up to $1.2 billion.

New Zealand Dollar currency ETF by WisdomTree

No

BNZ

$25.17

$18.49

(12.1.08)

$24.83

$25.31

$16.67

flat &

+34%

If you made a profit of 32%, take your profits early and often!

Read the article, "Foreign Investing: From BRICs to Barbeys," in Vol. 5, issue 7, for more information on why New Zealand is the new attraction on the world currency markets. New Zealand has the highest interest rate in the industrialized world. Currently, the Official Cash Rate is 2.5%. Reserve Bank Governor Alan Bollard, at the Reserve Bank of New Zealand, wrote in a press release on June 11, 2009, "The recent rise in the New Zealand dollar creates an unhelpful tension with our projections. A stronger dollar at a time of weak global growth risks delaying or even reversing the projected increase in exports, putting the sustainability of recovery at risk… We expect to keep the OCR at or below the current level through until the latter part of 2010."

U.S. Gold

Colorado USA

RISK: VERY HIGH

Yes

UXG

$5.05

$.50

$2.66

$7.04

$.38

-47% &

+532%

Note: U.S. Gold is not producing gold at this time; is it a gold exploration company, based in Nevada. U.S. Gold is an exploration company, not a mining company, meaning that if they strike gold, the stock should spike and if they don’t, you could lose your investment. Very risky.

NOTE: The mantra this year continues to be TAKE YOUR PROFITS EARLY AND OFTEN. If you’ve made a return of five times your investment, consider taking some of your profits. Since gold is still in favor (in our view) and U.S. Gold has not hit its full potential (in my view), I’m keeping this company on the Hot News List. Profit-taking is not the same as selling off all of the position.

Added to the S&P/TSX Global Gold Index and S&P/TSX Global Mining Index on 9.15.09.

If you believe in this CEO and company, you’ll want to make sure you have shares of U.S. Gold going forward. Gold should be a great hedge against inflation, which is predicted to become an issue once the economy starts to rebound (2010 and forward). Right now, the Feds are still a little concerned about deflation, but inflation could begin on the 12-24 month horizon.

This is an exploration company, not a mining company. They don’t produce gold at this time.

Began trading on the AMEX stock exchange on 12.11.06. (Also trades on the Toronto Stock Exchange.) See the feature interview with CEO and Chairman Rob McEwen in Vol. 3, issue 2, and click to watch highlights from Natalie Pace’s Q&A with Rob McEwen on NataliePaceDOTCOM YouTube.com channel. You can review my original Q&A with Rob McEwen and interview on U.S. Gold in Vol. 4, issue 2. (Feb. 2006).

Recently Deleted Companies 2008/2009:
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%. Genentech (8.1.08) +40%. Altair (deleted on 8.7.08) posted gains of +3% and +57%. Zoltek (deleted on 8.18.08) lost 30% before being removed. LDK Solar was deleted on 9.2.08 with 46% and 29% profits. U.S. Gold profit taking on 11.6.08 amounted to 72% gains. Conergy gains of 51% were taken on 11.7.08. American Superconductor posted 50% gains between 12.1 and 1.14.09. MEMC Electronics (WFR) had 21% gains between 12.1 and 12.15.08. STP had gains of 69% between 12.1.08 and 1.2.09. SQM profits 20% on 1.14.09. WWAT was deleted on 2.1.09 with -62% losses. On 2.15.09, AMSC had gains of 65%, MEMC Electronics 26%, Sociedad de Quimica y Minera 48% and U.S. Gold 432%. Citigroup gains of 42% on 3.15.09. Genentech was deleted on 3.15.09 with gains of 29%. OSI Pharmaceuticals was deleted on 3.15.09 with 7% gains. Rio Tinto was deleted on 3.27.09 with gains of 67%. On 3.27.09, the following companies were in the money: ALTI (+48%), AMSC (+51%), eBay (+24%), GE (+40%), HOKU (+38%), LDK (+46%), MEMC (+44%), PBW (+35%), SATC (+42%), SQM (+76%), STP (+211%), TSL (+207%), U.S. Gold (+456%) and WBK (+25%). Profit-taking 4.13.09: ALTI +209%, AMSC +70%, HOKU +32%, LDK +64%, PBW +42%, SQM +42%, UXG+418%. Deleted 4.13.09: eBay, +45%, Eurox -11%, GE +47% & -56%, Google +9%, Maxwell +25%, MEMC Electronics -33% & +49%, Microsoft +24%, SATC +67%. STP +262% & -64%, TSL +216% & -67%, Westpac +42% & -22%. Deleted 5.4.09: FMC Corp. with 19% gains. PZD with losses of -39%. SPWRA with 19% gains. TREMX with 50% losses. WSDT with losses of -59%. Deleted 5.15.09: SQM with gains of 38% and 62%. Deleted 5.31.09: EMKR with losses of 13% and 88% and Melco with losses of 8%. Ener1 with gains of 11% and 17%. Deleted 7.20.09: Conergy with losses of -52-98%. Deleted Smith and Nephew on 8.15.09 with gains of 17% and losses of 28%.

Recently Deleted from the Hot News list:
None

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:
None

Recent Deletions:
None

Company

NP owns?

Symbol

Price when featured

Price

10.02.09

Year High

Year Low

Gains since original feature

Altair Nano-technology

No

ALTI

$1.16

$1.05

$2.94

$0.60

-9%

Read "Life Begins with Lithium" Vol. 6, issue 4.

Altair was not on the list of battery makers receiving grants from the Obama Administration.

2Q earnings on August 7, 2009: Sales were $62,000 minus $183,000 in returned product (ugghhh). Net loss was $6.5 million.

Cash and cash equivalents: $28 million.

Big Lots

No

BIG

$30.28

$24.83

$34.88

$12.40

-18%

Read "Discount Designer Stores," from Vol. 5, issue 6.

Canadian Imperial Bank

RISK: Medium

No

CM

$65.88

$58.57

$108.79

$30.64

-11%

Refer to the "Banking on Iraqi Dinars" article in Vol. 5, issue 2 for details. Financial markets are under duress. Avoid most banks for now. Canada’s banks were ranked #1 by the Milken Institute for global capital.

Citigroup

RISK: HIGH

No

C

$2.26

$4.52

$27.35

$.97

+200%

Financial markets are under duress. Avoid most banks for now. Bailed out by the Feds November 2008. 1Q 2009 results will be released on 4.17.09 at 6:30 a.m. ET.

eBay

No

EBAY

$16.80

$22.70

$32.10

$9.91

+35%

Etail should perform better than retail in the recession. But eBay is still having reduced earnings. Waiting for a leveling off period.

Ener1

No

HEV

$6.86

$6.94

$9.49

$2.35

flat

ADD TO HOT NEWS LIST? PROBABLY WILL WAIT UNTIL THE END OF OCT…

Read "Life Begins with Lithium" from Vol. 6, issue 4. Won an award of $118.5 million to develop batteries for hybrid and electric vehicles. Was mentioned by name by President Obama in his remarks of 20090805. Waiting for a better buy-in point.

Eldorado Gold

No

EGO

$10.56

$10.60

$11.39

$2.38

flat

Read "Investing in Gold" from Vol. 6, issue 9.

First Solar

No

FSLR

$144.76

$150.00

$317.00

$85.28

+4%

See "Solar Springs Up Again," article in Vol. 5, iss 4. Announces earnings on 7.30.09 after the markets close.

First Solar joined S&P500 on 10.02.09.

First Solar uses cadmium telluride instead of silicon to transfer sunlight into useable energy. This was a huge competitive advantage when silicon was hard to get at a reasonable price. That is shifting, however, for two reasons. Silicon manufacturing is heating up and costs are lowering as a result, and cadmium telluride isn’t as abundant or as efficient a power source as silicon. Read the article for more details.

FMC Corp.

No

FMC

$51.36

$52.70

$80.23

$28.53

+3%

ADD TO HOT NEWS LIST IN Nov/Dec?

Read "Life Begins with Lithium" from Vol. 6, issue 4. FMC is the real winner of the stimulus package because they supply lithium to the battery makers. Waiting for a better buy-in point.

Google

No

GOOG

$393.69

$484.58

$602.45

$247.30

+23%

See Vol. 6, issue 5 for "Hulu Your Heroes" CEO Eric Schmidt just stepped down from the board of Apple, Inc. Thomson Reuters said analysts expected this because Apple and Google have begun to compete on smart phones and computer operating systems. Note that Google’s 52-week low if $247.30 and be careful not to buy in too high.

Maxwell Labs

No

MXWL

$10.25

$17.43

$14.75

$4.00

+70%

Read "Life Begins with Lithium" from Vol. 6, issue 4. Increased sales by 30% this 2nd Quarter over last year, to $24.8 million from $19 million. Net loss for Q209 was $5.3 million, compared with $4 million the year prior. Cash on hand = $31.5 million. It is the continuing losses and constricted capital environment that prevents us from putting this company on the Hot List, even though sales are jumping. We’ll look again at the 3Q 2009, which should occur around November 11, 2009.

MEMC Electronics

No

WFR

$18.08

$15.38

$73.56

$10.00

-15%

Read "The Sunny Side" Vol. 6, issue 3.

2Q 2009 earnings report 7.13.09:

"While we saw a significant increase in sales compared with the first quarter, our overall results continue to reflect the generally weak macroeconomic conditions," said Ahmad Chatila, MEMC's President and Chief Executive Officer. "Semiconductor wafer volumes rose from severely depressed first quarter levels, primarily due to stronger demand from Asia and inventory replenishment, but continued to be significantly below historical levels. In solar, limited credit availability in the broader solar market continued to restrain demand while supply excesses remain visible across the solar value chain. On the positive side, MEMC continued to broaden its solar wafer customer base during the quarter, adding several new customers."

In April 2009, BP Solar sued MEMC, alleging non-delivery of polysilicon powder under three-year supply agreement that MEMC said has never existed. BP claimed damages of up to $140 million. The verdict awards damages of $8.8 million to BP Solar, according to MEMC, who is appealing the decision.

Microsoft

No

MSFT

$20.12

$24.96

$30.53

$14.87

+23%

Great blue chip. Buy at the best possible price.

PowerShares Wilderhill Clean Energy ETF

No

PBW

$9.78

$10.24

$23.96

$5.78

+5%

Read "The Sunny Side" Vol. 6, issue 3.

Rio Tinto

No

RTP

$180.79

$160.88

$558.65

$59.20

-11%

Gold, copper and other commodities mining. Based out of UK. Mines worldwide, but focused greatly in Australia.

Ross Stores

No

ROST

$35.90

$46.01

$48.58

$21.23

+30%

Read "Discount Designer Stores," from Vol. 5, issue 6.

Satcon

No

SATC

$2.30

$2.01

$3.51

$1.08

-13%

Read "The Sunny Side" Vol. 6, issue 3. Announced 2Q results on 8.13.09. Revenue was down to $9.2 million from $13.4 million a year ago. Net loss was $7.1 million, as compared to a loss of $9.1 million a year ago. Cash and cash equivalents equal $23 million. Certainly could benefit from the focus on clean energy as the company makes power converters and was the company of choice when Google built their solar plant.

It is the continuing losses and constricted capital environment that prevents us from putting this company on the Hot List, even though sales are jumping. We’ll look again at the 3Q 2009, which should occur around November 13, 2009.

Sociedad Minera y Quimica de Chile

No

SQM

$36.36

$36.96

$59.41

$12.98

Flat

ADD BACK TO HOT LIST IN Nov/Dec?

Read the article, "Treasure Hunting," in Vol. 5, issue 10 and the article "Life Begins with Lithium," from Vol. 6, issue 4. SQM announced on Sept. 30, 2009 that prices for lithium carbonate and lithium hydroxide will be reduced by approximately 20% from current levels for the renewal of all its supply contracts. The purpose is to accelerate demand recovery, create incentives for research of new lithium uses, and contribute to the sustainable long-term development of the lithium market.

Sohu (Chinese Co. ADR)

Beijing, China

Small Cap

RISK: MEDIUM

No

SOHU

$46.54

$64.63

$91.50

$34.10

+40%

See NataliePace.com ezines, Vol. 3, issue 4 and Vol. 2, issue 9 for feature articles on Sohu. Dr. Charles Zhang, the Chairman and CEO of Sohu.com, is one of our CEOs of the year in 2007. Read the articles in Vol. 4, issue 1. You can watch a Q&A with Dr. Charles Zhang in an exclusive interview I did on the Forbes.com Video Network.

Sunpower

No

SPWRA

$30.26

$27.53

$107.00

$18.50

-9%

Read "The Sunny Side" in Vol. 6, issue 3.

Announced 2Q earnings on July 23, 2009. Revenue of $298 million. Raised $458 million in a successful equity and convertible debt offering. Expanded to approximately 600 SunPower dealers worldwide. SunPower reported gross margin of 19.6%, operating income of $9.9 million and net income per share of $0.26. Signed a $100 million commercial project financing agreement with Wells Fargo Bank.

For fiscal year 2009, the company expects the following total company GAAP results: revenue of $1.35 billion to $1.7 billion and net income per diluted share of $0.45 to $0.90.

"Our long-term strategy to build our brand based on superior experience, technology and return is paying off. As a result, we have successfully adjusted pricing to maintain market share and our price premium," said Tom Werner, SunPower's CEO."

 

Sunpower just raised an additional $417.6 million through issuance of 10,350,000 Class A shares (at $22.00 per share) and 4.75% senior convertible debentures due 2014. (4.30.09)

Suntech Power Holdings

No

STP

$16.06

$13.98

$49.60

$5.09

-13%

Read "The Sunny Side" Vol. 6, issue 3. The world's largest crystalline silicon photovoltaic (PV) module manufacturer.

Announced 3Q 2009 on August 20, 2009 before the markets opened. Revenues were $321 million, up slightly from last quarter, but down 33.2% from the same Q last year. Net profits were $10 million, off 81% from the same time last year.

Trina Solar Ltd.

No

TSL

$17.56

$29.76

$53.50

$5.61

+66%

Read "The Sunny Side" Vol. 6, issue 3.

7.28.09: 20-F Annual report (of foreign issuers): For the second quarter 2009, the Company estimates:

-- total shipments of approximately 63 MW to 65 MW of PV modules, compared to the Company's previous guidance of 60 MW to 65 MW, an increase of 29.1% to 33.2% from the first quarter of 2009 and an increase of 32.4% to 36.6% from the second quarter of 2008.

-- total net revenues of approximately $148 million to $152 million, an increase of 12.0% to 15.1% from the first quarter of 2009 and a decrease of 25.6% to 27.5% from the second quarter of 2008.

Westpac

No

WBK

$73.54

$107.95

$122.58

$45.16

+47%

Issued it’s half-year "interim" results on May 6, 2009. Go to Westpac.com.au to access.

Wisdom Tree Indian Rupee currency ETF

No

ICN

$24.28

$24.62

$25.71

$20.42

Flat

Read the article, "Banking on Iraqi Dinars," from Vol. 5, issue 2.

 

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 (APPL)
Baidu (BIDU)
Time Warner (TWX)

DELETIONS:
KB Home (KBH)
Toll Brothers (TOL)

Company

NP owns?

Symbol

Price when added to Cooling Off List

Price 10.02.09

52-week High

52-week Low

Gains/Loss

American Express

Yes

AXP

$16.98

$34.17

(9.15.09)

$32.49

$52.63

$14.72

+91%

-5%

Read the article "American Express," from Vol. 6, issue 2. Earnings 7.23.09: Revenue in the 2nd Q 2009 was off 18% and net income was down 48%, to $337 million, from $660 million a year ago. $16 billion in cash on hand. Longterm debt is $54 billion, with $28 billion in "other liabilities." Customer deposits are $20 billion.

Apple Computer

No

AAPL

$132.07

$184.90

$192.24

$78.20

+40%

See archived ezine Vol. 4, issue 2, for the feature article, "Apple Chips."

The Methodist University Hospital Transplant Institute confirmed on 6.23.09 (by press release) that Steve Jobs received a liver transplant at their hospital, and that he qualified for the transplant because he had the highest MELD score, meaning that he was sickest patient on the waiting list at the time a donor organ became available. According to James D. Eason, M.D., program director at the hospital, Mr. Jobs is now recovering well and has an excellent prognosis.

So will Jobs return to work full-time as the CEO? Apple is notorious for being circumspect about Jobs’ health and there has been no official word on the issue. Apple quoted Jobs on the earnings press release of July 21, 2009, but did not include him on the earnings call. Even if Tim Cook can do a great job, which he seems to be doing, it’s likely to be a very volatile day for Apple when/if Jobs doesn’t return fulltime to the CEO post.

3Q 2009 earnings on 7.22.09 were amazing: posted revenue of $8.34 billion and a net quarterly profit of $1.23 billion, or $1.35 per diluted share. These results compare to revenue of $7.46 billion and net quarterly profit of $1.07 billion, or $1.19 per diluted share, in the year-ago quarter. Gross margin was 36.3 percent, up from 34.8 percent in the year-ago quarter. International sales accounted for 44 percent of the quarter’s revenue.

Dr. Eric Schmidt, CEO, Google, resigned from Apple’s board on August 3, 2009. According to Steve Jobs, it’s because Google’s new products pose a conflict of interest with Apple’s core biz. No surprise here. It was expected.

On September 15, 2009, Bruce Sewell, formerly senior vice president and general counsel of Intel Corporation, because SVP and general counsel, replaced Daniel Cooperman, who had the job for the last two years. Cooperman’s departure at this time seems to be slightly more troublesome, given that he would have been actively involved in the decision to keep the extent of Jobs’ illness from investors (whether he opposed or supported it).

Insider selling is over $90 million since June 2009 (after Jobs announced his liver transplant).

Applied Materials

No

AMAT

$12.76

$13.51 (9.15.09)

$12.68

$21.75

$7.17

-1% &

-6%

Leadership, product line and recessionary actions were strong, but AMAT transitioned to solar just when sales dropped off. Weathering the storm is imperative in the meantime. Investors should be aware of the high P/Es of this company, which is hard to justify in a contracting environment. With almost $2 billion in cash and marketable securities, AMAT is in a position to regroup and recover in the future. With any luck and with the purported US emphasis on clean energy (which has yet to see real funding), this is a temporary setback.

3Q loss (released on 8.11.09) was $55 million on $1.13 billion of net sales. "In a difficult environment, Applied improved its operating performance and generated significant cash flow while making substantial investments in new technologies for next-generation semiconductor chips, flat panel displays and solar panels," said Mike Splinter, chairman and CEO.

Baidu

No

BIDU

$183.15

$347.22 (8.13.09)

$375.21

$397.70

$100.50

+204%

Leading Chinese website for search (similar to Google). 85 P/E is high for a revenue stream so tied to advertising (during a global recession). (Advertising revenue models tend to suffer greatly in recessions and Google’s P/E is only 30, by comparison, right now.)

7.27.09 1Q 2009 earnings: According to the company, "Our operations are primarily based in China, where we derive substantially all of our revenues. Total revenues in 2008 were RMB3.2 billion (US$468.8 million), an 83.3% increase over 2007. Operating profit in 2008 was RMB1.1 billion (US$160.8 million), a 100.4% increase over 2007. Net income in 2008 was RMB1.0 billion (US$153.6 million), a 66.6% increase over 2007."

The primary Risk Factor for Baidu is: We derive revenues primarily from online marketing services, which accounted for 98.9%, 99.8% and 99.9% of our total revenues in 2006, 2007 and 2008, respectively.

Berkshire Hathaway

No

BRK.A

$97,000

$102,105 (8.13.09)

$99,500

$147,000

$70,050

+2.5% &

-3%

Read "The Oracle Turns 80," in Vol. 6, issue 8.

Capital One Financial

No

COF

$22.29

$37.98 (9.15.09)

$33.19

$63.50

$7.80

+49% &

-13%

Credit card companies are under distress. And now, the Obama Administration is setting up a Bill of Rights for their customer. Tough times for the credit industry continue, and this company is really experiencing some of the toughest challenges of the field.

2Q 2009 earnings on 8.10.09: $146 billion in liabilities, with (reportedly) $172 billion in assets, including $101 billion in "loans held for investment."

Cash and cash equivalents were $4.8 billion, down from $7.5 billion at the end of 2008.

According to the earnings report. "The adoption of SFAS 166 and SFAS 167 could have a significant impact on the Company’s consolidated financial statements because the Company expects it will be required to consolidate at least some of its special purpose entities to which pools of loan receivables have been transferred in transactions previously qualifying as sales. Holding more of these assets on the Company’s balance sheet may require it to take various actions, including raising additional capital, in order to meet regulatory capital requirements. Such capital may not be available on terms favorable to the Company, if at all, and could have a negative impact on the Company’s financial results. As of June 30, 2009, the Company had approximately $44.5 billion of credit card receivables held by QSPEs."

Read the article "American Express," from Vol. 6, issue 2.

Fortress Investment Group

No

FIG

$3.57

$5.37 (8.13.09)

$4.91

$19.50

$0.77

+38% &

-9%

Released 2Q 2009 results on August 5, 2009. Earnings are down -39% in 1Q 2009 from the same quarter a year ago. GAAP net loss of $171 million, with principals still getting paid $66 million in the quarter. Daniel H. Mudd, currently member of the Fortress board of directors, will become the firm's new CEO effective August 11, 2009. George W. Wellde has been elected to Fortress' Board of Directors.

Read the articles, "Cherry Picking the Cherry Bombs" (Vol. 5, issue 12) and "Money Grows on Wisdom Trees," from Vol. 4, issue 3. Reported earnings on 3.15.09. FY 2008 GAAP net loss of GAAP net loss of $322 million. Principals in the company earned $222 million of that net loss.

2Q2009 earnings on 8.09: Net los of -$171 million. Without paying the principals in the company, the net income would have been $66 million. Man these guys are getting paid a lot to lose a lot of dough!

On 9.22.09: dividend was canceled by Board.

Intel

RISK: LOW

No

INTC

$16.66

$20.25 (9.1.09)

$18.97

$25.29

$12.06

+14% &

-6%

Intel is a great blue chip. However, business spending fell off a cliff in the recession. A P/E of 42 is too high if the recession continues.

Green: Intel and Google launched ClimateSaversComputing.org in 2007, with a goal of achieving a 50% power consumption reduction by 2010. They have convinced all kinds of partners to come on board, including competitors: Advanced Micro Devices and Microsoft!

Reported 2Q results on 7.14.09: had non-GAAP operating income of $1.4 billion, net income of $1.0 billion and EPS of 18 cents. On a GAAP-basis, the company reported an operating loss of $12 million, a net loss of $398 million and a loss per share of 7 cents.

"Intel’s second-quarter results reflect improving conditions in the PC market segment with our strongest first- to second-quarter growth since 1988 and a clear expectation for a seasonally stronger second half," said Paul Otellini, Intel president and CEO. "Intel's strategy of investing in new technologies and innovative products, combined with ongoing focus on operating efficiencies, continues to yield benefits that are evident in our strengthening financial performance."

Medtronic

No

MDT

$33.35

$37.09

(9.15.09)

$36.46

$56.97

$24.06

+9% &

-2%

Medtronic’s Infuse Bone Graft product has been linked with a number of problems, including that the doctor paid to report on the studies of the product falsified positive reports. Other allegations include aggressive incentives for doctors to use the device. While these are allegations at this point, and not proven facts, biotechnology is a volatile industry and the negative headlines that keep coming from the Wall Street Journal are unlikely to make this company the Belle of Wall Street.

On 5.19.09, the company issued a press release, saying: "For fiscal year 2010, the company expects revenue growth in the range of 5-8 percent on a constant currency basis. The company also expects diluted earnings per share (EPS) in the range of $3.10 to $3.20, which reflects EPS growth in the range of 8-12 percent after adjusting for approximately 6-7 cents of earnings dilution from the recent acquisitions of CryoCath, Ablation Frontiers, Ventor, and CoreValve."

"Earnings per share estimates exclude the effect of any special or extraordinary charges that may impact the company’s continuing operations and do not include the impact of the new accounting method for recognizing non-cash interest expense on convertible debt."

MGM Mirage

No

MGM

$26.79

$11.06

$100.50

$5.10

-59%

Get more information in Vol. 5, issue 10 in the "(No) Viva Las Vegas" article. The City Center project looms as exceedingly problematic in today’s vast downturn of real estate in the Las Vegas area. Anticipating very bad news on this project in the near future. MGM has kept itself alive in the harshest climate of the new millennium through selling assets, selling more stock and taken on more debt. All of the debt receives a junk rating from Fitch. On October 1, 2009, they had to cancel a debt exchange offer due to low interest from debt-holders.

Earnings on 8.3.09: Net revenue decreased 17% to $1.5 billion. Net loss was $213 million.

Sears Holding

Yes

SHLD

$52.93

$78.37 (8.13.09)

$62.59

$108.75

$26.80

+18% &

-20%

Read the articles, "Cherry Picking the Cherry Bombs" (Vol. 5, issue 12) and the "Discount Designer Stores" article (Vol. 5, issue 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. 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.

You can read the shareholders letter from Chairman Eddie Lampert on the SearsHoldings.com website. 10 minutes into the letter, and I have to call this a rant. Big red flag folks.

Still don’t have a CEO. Bruce Johnson is interim CEO. New CFO started last October, right before the preparation of the annual report began. The former CFO Miles Reidy decided that he needed to spend more time with his family than to put is name on the 2008 annual report. Another big red flag.

Consensus, colossal insider selling to the tune of over $80 million, including warrants that were exercised by interim CEO Bruce Johnson.

3Q 2009 earnings on 8.20.09: Net loss was $94 million. Total revenues decreased $1.2 billion to $10.6 billion for the 13 weeks ended August 1, 2009, as compared to total revenues of $11.8 billion for the 13 weeks ended August 2, 2008. The decrease was primarily due to lower comparable store sales and included a $126 million decline due to the impact of foreign currency exchange rates.

Significant uses of our cash during the first half of 2009 include $134 million for share repurchases, contributions to our pension and post-retirement benefit plans of $96 million, capital expenditures of $122 million and debt issuance costs of $81 million. These amounts were partially offset by borrowings. Total debt (consisting of short-term borrowings, long-term debt and capital lease obligations) at August 1, 2009 was $3.2 billion, as compared to $3.6 billion at August 2, 2008.

Taubman Centers REIT

No

TCO

$24.74

$33.81 (9.15.09)

$33.25

$65.99

$12.43

+34% &

-2%

Read the article, "Global Recession," from Vol. 6, issue 6 in June 2009.

The income reported on July 23, 2009 was actually "cancellation income," not rent. Read the details, not just the numbers.

"The environment for retail real estate continues to be challenging," said Robert S. Taubman, chairman, president and chief executive officer of Taubman Centers. "Lease cancellation income from our tenants offset a decline in rents. In addition, we are very focused on costs throughout our organization, which contributed to our results during the quarter."

2Q 2009 earnings on 7.23.09: Net income allocable to common shareholders per diluted share (EPS) was $0.17 for the quarter ended June 30, 2009, up from $0.01 for the quarter ended June 30, 2008. EPS for the six months ended June 30, 2009 was $0.38, up from $0.09 for the first six months of 2008.

Time Warner

No

TWX

$24.44

$29.63

$50.70

$17.81

+20%

Read the article, "Hulu Your Heroes," from Vol. 6, issue 5 in May 2009.

2Q earnings on 7.29.09: In the quarter, Revenues declined 9% from the same period in 2008 to $6.8 billion. Lower revenues at the Publishing, AOL and Filmed Entertainment segments more than offset growth at the Networks segment. Net Income was $519 million, down from $792 million the year prior.

CEO Jeff Bewkes said: "At the same time, we’re continuing the reshaping of Time Warner that we started last year. We’re on track to spin off AOL to our stockholders around the end of the year. Separating AOL will benefit both companies – enabling Time Warner to concentrate fully on our core content businesses and improving AOL’s operational and strategic flexibility."

Wells Fargo

Yes

WFC

$20.05

$28.88

(8.13.09)

$26.28

$44.69

$7.80

+31%

-9%

See "Wells Fargo’s Incredible Exploding Earnings" in Vol. 5, issue 9, and "Wells Fargo’s Great Depression," in Vol. 4, issue 12. Announces 3Q earnings on Oct 21, 2009 at 5:00 a.m. PT (before market open).

2Q 2009: Record Wells Fargo net income of $3.17 billion, up 81 percent from last year; $6.22 billion for six months ended June 30, 2009, up 66 percent from last year. Net income was $2.58 billion. So why is it here on the Cooling Off list? Read the articles...

Wynn Resorts

No

WYNN

$95.42

$67.66

$176.14

$18.06

-29%

Check out the article, "(No) Viva Las Vegas" in Vol. 5, issue 10.

2Q 2009 results announced on 7.30.2009. Net revenues for the second quarter of 2009 were $723.3 million, compared to $825.2 million in the second quarter of 2008. Net income for the quarter was $25.5 million, or $0.21 per diluted share, compared to net income of $272.0 million, or $2.42 per diluted share in 2008. Adjusted net income in the second quarter of 2009 was $11.5 million, or $0.09 per diluted share (adjusted EPS)(2) compared to an adjusted net income of $124.3 million, or $1.11 per diluted share in the second quarter of 2008.

Total cash balances on June 30, 2009 were $1.1 billion. Total debt outstanding at the end of the quarter was $4.1 billion, including approximately $2.6 billion of Wynn Las Vegas debt and $1.5 billion of Wynn Macau debt.

Recently Deleted in 2008/2009:
Fannie Mae was deleted on 2.11.08 after losing -50% and -56% of its share price value, and then again on 7.1.08, after losing another -40%. (Both puts more than doubled.) Novastar Financial (NFI) was deleted on 6.2.08 with -95% share price implosion. Sears Holding Corp. was deleted on 7.1.08 with 64% gains on the put option. Wells Fargo was deleted on 7.1.08 with 83% gains on the put. Apple was deleted on 8.1.08 with 35% gains on the put. The Google put, deleted on 8.1.08, was another great performer, with over 50% gains. First Solar had gains of over 32-34%. Mentor was deleted on 9.30.08 with 75% gains on the put option (-17% on the share price); Medicis was deleted with gains of over 37% on the share price (down direction). Boston Properties, Las Vegas Sands and Macerich were deleted on 10.9.08 with gains of 16-30%, 66% and 28-42% respectively. Wells Fargo was deleted on 11.6.08 with 35-50% gains on the put and again on 12.1.08 for 50-70% gains. American Express posted 35% gains in just 30 days, between 2.1.09 and 3.2.09. First Solar was deleted on 8.13.09 with 33% gains. KB Home with 74% gains and Toll Brothers with 51% gains on 10.01.09.

KB Home

RISK: HIGH

No

KBH

$59.00

$15.19

$48.67

$6.90

-74%

Read the article, "Rupert Murdoch, Nobel Laureates and Top Real Estate CEOs. Find Out Where They Are Investing," from Vol. 2, issue 5. In May 2005, we called REITs a burnout sector, and the fallout should continue, with high home prices, rising interest rates, people backing out of contracts and rising inventory. REALTOR.org’s chief economist is not predicting housing to recover in 2009. "Disproportionately high distressed home sales will continue for the remainder of the year because foreclosures and the release of foreclosed properties onto the market will be rising for the remainder of the year." Lawrence Yun, chief economist, National Association of Realtors, in a press release dated May 27, 2009.

McMansions are going the way of Hummers (extinct) in the new cleaner, greener, fuel-efficient world. Who can afford to heat these huge homes? Who is buying new real estate these days at prices that KB can make a profit on (considering their cost to carry the land, etc.)?

9.25.09 3Q 2009 earnings: Revenues totaled $458.5 million, down 33% from $681.6 million in the third quarter of 2008, due to lower housing revenues. Net loss was $66.0 million. In the 2008 third quarter, the Company reported a net loss of $144.7 million. Orders are increasing. The Company’s backlog at August 31, 2009 totaled 3,722 homes, representing potential future housing revenues of approximately $734.1 million.

"In this challenging environment, we significantly narrowed our third quarter net loss from a year ago through the disciplined execution of our strategic initiatives," said Mezger. "Restoring the profitability of our homebuilding business remains our highest priority, and we continue to take actions to achieve this objective."

Toll Brothers

RISK: MEDIUM HIGH

No

TOL

$37.82

$18.68

$28.00

$15.49

-51%

Read the article, "Rupert Murdoch, Nobel Laureates and Top Real Estate CEOs. Find Out Where They Are Investing," from Vol. 2, issue 5 in 2005, when we first reported on REITs as a burned out sector.

McMansions are going the way of Hummers (extinct) in the new cleaner, greener, fuel-efficient world. Who can afford to heat these huge homes? Who is buying new real estate these days at the prices that TOLL needs to earn a profit? Real estate is expected to continue to decline through 2009, at minimum. (Toll Brothers cashed out hundreds of millions beginning as early as 2005.)

 

IMPORTANT DISCLAIMER (PLEASE READ):

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:

Interested in being more like Brad and Angelina? Get involved with the Clinton Global Initiative University as a volunteer, helping to save the world. (You might even meet the stars themselves.)

The NataliePace.com Calendar section features conferences, teleconferences, retreats, educational opportunities, cultural events, galas, market events and online chats with executives and VIPs. Stay plugged in! We add online chats, article updates, teleconferences, etc. as they are booked, so be sure to visit the calendar section early and often.  Below is only a partial listing of what’s happening this month.

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.

Clinton Global Initiative University Conference, Miami, FL
Friday, April 16-18, 2010
This 3-day event is one where students work hand-in-hand on global issues, and even get their hands dirty on a community service project. Of course, doing this alongside Prez. Clinton and a few celebrity friends, like Brad Pitt, doesn't hurt! You must apply with a proposal to be accepted. Act fast!

The Women's Conference, Long Beach, CA
Tuesday, October 6th, 2009

7:30AM through 6:30PM PT
California First Lady Maria Shriver hosts a 2-day celebration for transformation, where women are encouraged to be architects of change. Speakers include Katie Couric, Ashton Kutcher, Sir Richard Branson, Caroline Kennedy and more!

Solar Decathlon, Washington, D.C.
Friday, October 9th, 2009

Tour 20 solar homes in a special solar village during Oct 9 through Oct. 18, 2009. Homes are part of a competition between universities to design, build, and operate the most attractive and energy-efficient solar-powered home.

Nominate a Fabulous Woman!
Friday, October 9th, 2009
If you know of a person who deserves worldwide recognition for the work she or he has done on behalf of women, nominate her or him today!

Sacred Valley Yoga Retreat (Peru)
Monday, October 12th, 2009
Discover the magical healing powers of the Andes in this 10-day transformative Yoga, Meditation and Shamanic Healing retreat in Peru's Sacred Valley. Put on by Bliss Yoga Center, Woodstock, NY.

Direct Marketing Association 2009 Convention, San Diego
Saturday, October 17th, 2009

Direct Marketing Conference and Exhibition. Digital this and interactive that. Search engines and social networks. New channels and next-generation strategies.

Solar Energy Conference, San Jose, CA
Monday, October 19th, 2009

Solar Power 2009 features over 210 exhibitors, 125 speakers, networking opportunities galore, and an anticipated 10,000 visitors! Every major solar company in the world, from STP, SPWR to GE Solar will be there on display!

Solar Power International 2009
Tuesday, October 27th, 2009
Robert F. Kennedy Jr. is confirmed to present "Green Gold Rush: A Vision for Energy Independence, Jobs, and National Wealth" on October 28 at Solar Power International 2009.

Advance Estimates for 3rd Quarter 2009 GDP Growth
Thursday, October 29th, 2009

8:30AM ET
The U.S. Dept. of Commerce, Bureau of Economic Analysis (BEA.gov) releases its advance report on GDP growth in the 3rd quarter of 2009. Final numbers for 2Q were -0.7%. 1Q GDP growth came in at -5.5%.

Federal Open Market Committee Meeting
Tuesday/Wednesday, November 3-4, 2009

The Federal Reserve Board governors meet for two days, on the 3rd and 4th of November to determine the best monetary policy for sustained, healthy growth.

Opportunity Green Conference, LA, CA
Saturday, November 7th, 2009

Opportunity Green 2009 is a 2-day event focused on greening biz in a profitable way. Explore Product Innovation & Design for Sustainability, How Fortune 500's are Implementing Sustainability for Growth, Raising Investment Capital, Branding...

Greenbuild Conference, Phoenix, AZ
Wednesday, November 11th, 2009

Revolutionary Green: Innovations for Global Sustainability, hosted by the Green Building Council. This year, the keynote speaker is Archbishop Desmond Tutu. Experts on the green building movement and green collar jobs.

Professional BusinessWomen of California 2009 Sacramento Conference
Tuesday, November 17th, 2009

Join the largest gathering of professional women in the Sacramento Area for a day of learning, networking and inspiration. Local and national experts will share the latest strategies for career advancement, leadership, communication, work/life balance and more. Network with state senators & CEOs!


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