Health Care Reform and Cloud Computing: the Next Big Win?

by Natalie Pace.

Includes a Medical Records Info Tech Report Card.

The health care bill is signed, but there is an easier way to figure out "who wins" than reading the tea leaves of each word spoken or the long-winded definitions and legal-ease of the 2,310-page document itself. Why not just follow the money? It’s Obama’s baby and he’s already laid out $787 billion in government stimulus, including a major focus on health care.

You can track where the money is going on the government’s website: Recovery.Gov.

One of the five major goals of the American Reinvestment and Recovery Plan is to put America’s health records online within five years, to "increase efficiency" in the medical system itself, medical costs and even care. Other goals of the Plan include: 2) doubling renewable energy capacity, 3) weatherizing federal buildings and two million homes, 4) modernizing 10,000 schools and improving learning environments for 5 million children and 5) investing in roads, bridges and mass transit.

The companies featured in this month’s Information Technology Stock Report Card are the leaders in answering the call to get the nation’s medical records online. VMWare is a company that boasts of having every company in the Fortune 100 as a client and is a leader in the newest trend in cyberspace – cloud computing. (The company was spun off of Electronic Data Systems on August 14, 2007.) EMC has been and remains an excellent distribution channel for VMWare’s virtualization infrastructure platform, but VMWare has other partners, as well, including some of the tops in the medical technology field.

VMWare is the virtualization platform for FUJIFilm USA and Allscripts – two of the leading electronic medical transcripts companies in the health care industry. VMWare is also mentioned by name in more than one Department of Energy report and recommendation as the company of choice to reduce power consumption and the "footprint" of federal data centers.

Electronic Data Systems (EDS), VMWare’s former owner before its 2007 IPO, just poured another $50 million into VMWare common stock. Could it be that EDS knows something we don’t know (yet), or is the company just increasing its power and authority? VMWare’s revenue growth jumped 18% in the last quarter, compared to a year ago, which is impressive in a "jobless recovery," but not so outstanding that you want to leap into a price to earnings ratio above 100, which is where it was trading on March 30, 2010.

Allscripts (Nasdaq: MDRX), a leading provider of clinical software, services, information and connectivity solutions used by the physicians and other health care providers, has a great stock symbol (very easy for investors to remember) and revenue growth that is even more attractive – at 32% increase in the most recent quarter from a year ago. Allscripts’ revenue growth in the last quarter was double that of competitor, Quality Systems (at 15% growth in the last quarter, compared to a year ago).

So, both Allscripts and VMWare are leaders in this rapid growth area that has been targeted for stimulus funding. The question is, "Should you buy at the 52-week high or are these companies just too pricey in a vulnerable marketplace?"

Ah! Where’s the crystal ball? Certainly a high growth area is the high ground on Wall Street, however if hurricane season drowns the Spring Rally we’re enjoying, even high ground could get a little soaked. For my money, even if EDS might be tipping their hand of good news with their recent big purchase of VMWare common stock, I’d prefer to wait and buy if/when these companies return to the lower prices (half of today) they were trading at earlier this year.

If the markets follow the historical trends of the last few years – of bottoming out on bad news around October/November -- both of these excellent companies could be on sale for Christmas. No real risk in having your Stock Shopping List handy and waiting for a better price.

I put VMWare and Allscripts on the Stocks to Watch List portion of my Hot News on Cool Stocks report today.

Full Disclosure: Natalie Pace does not own stock or positions in any company mentioned in this article.

About Natalie Pace:
Natalie Pace, is the author of You Vs. Wall Street and host of the Pace and Prosperity radio show on BlogTalkRadio.com/NataliePace! She is a repeat guest on FoxNews, CNBC, ABC TV and has contributed to Forbes.com, Sohu.com and BestEverYou.com and Magazine. As a philanthropist, she has helped to raise more than two million for Los Angeles public schools and financial literacy. Follow her on Twitter.com/NataliePace, YouTube.com/NataliePaceDOTCOM and Facebook.com. 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 all in on any asset class or individual stocks. 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.

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.

Kelley Wright, the author of Dividends Still Don’t Lie, Predicts a Downturn that Could Test the Lows of March 2009.

Tapping the Wisdom of Blue Chips King Kelley Wright, the managing editor of Investment Quality Trends and the author of Dividends Still Don’t Lie.

Blue Chips King, Kelley Wright, the managing editor of Investment Quality Trends, predicts a Spring Stock Market Rally, followed by another downturn that could "test the lows of March 2009." Discover what industries he thinks are in favor now, and how to protect yourself in the event of another crash. Listen on-demand or download the March 10, 2010 podcast at BlogTalkRadio.com/NataliePace.

Below are excerpts from my interview with Kelley Wright on BlogTalkRadio.com/NataliePace, as part of my Pace and Prosperity radio show series.

Natalie Pace: Are We in a Recovery?

Kelley Wright: When you look at the bear markets throughout history, typically, you have one downturn, and then a nice, and very profitable rally. But then you get a second leg down which will eventually end in a new low of the bear market cycle. Historically, investors have treated that second leg down as the bottom. And then you’ll get a nice rally again, which everyone sees as the birth of a new bull market. Then low and behold something happens and you generally have a third leg down, which ultimately ends as the final bear market bottom.

Hmmm…. Where Are We in That Cycle?

We actually think the bear market began in 2000. Our first leg down ended in 2002. Then we had that massive rally until 2007, which very much mirrored what happened in 1972 and 1973 in the last bear cycle. Then we rolled over in September/October of 2007. That leg down ended March 9, 2009, and we are currently in another cyclical bull counter-trend. But we probably have at least one more leg down.

Uh-oh. How far down?

At minimum, we’ll test the March 9, 2009 Lows [when the Dow Jones Industrial Average dropped to 6547).

Did I hear you right? The Dow could bottom out to the 6500 range again? Ow!

I know. I don’t mean to be negative. That’s just the history of bear markets.

This is important because a lot of people were in bad shape at the March 9, 2009 lows. What do you suggest for people who are worried about another downturn? So many people just don’t trust this rally, with the high unemployment and all. What can people do right now to help protect themselves?

The Federal Reserve and the Treasury have had to do some pretty dramatic things to try and keep the wheels from falling completely off. Accordingly, we have historic low interest rates, so your return from interest on CDs and bonds – those yields are very low. They’re impossible to generate a return off of.

Let’s point out, for those who don’t know, what happens to bonds when interest rates start to rise. If you’re locked into low-yielding bonds, the value of your bond will drop dramatically. No one will want to own a bond at 4% yield, when the new interest rate becomes 8%.

You can lose as much in principle in bonds as you can in stocks, if you load up on longer maturing bonds at the wrong time and then yields start going up. You can see the face value of your bonds decline, just like you can see in a stock sell-off. If you’re going to own bonds, you’ve got to own very short maturities and very short durations.

You’re safe if you own bonds that you bought a number of years ago at a higher interest rate… Right?

Yes. Absolutely. But, if you’re buying bonds currently, you’ve got to be concerned about yield and maturity. So, you’re almost forced to look at the stock market for returns.

When is the third leg of the downturn coming, in your estimation?

We’ll continue to rally into the summer. The market will try to breach the January high and maybe put in a new recovery high. The price of oil is lurking in the background. Investors have to be aware of the potential for a pretty significant rally in the price of oil, which might cause a little bit of havoc in the markets. We’re probably in decent shape until the summer, around Labor Day.

Do you think investors can make a little extra money in oil right now? And if so, which companies do you follow?

Chevron and Exxon Mobil are huge companies, very old, very oily, and they have phenomenal dividend histories as well. They have a great track record of increasing their dividends every year. You can look at Schlumberger; they are in the services side of the business. There is Overseas Shipping Group (symbol: OSG). They’re a tanker company and they transport crude and distillates over the seas. So, that’s another way to play the energy story.

What makes you believe oil will go up again?

Good old-fashioned supply and demand. We have developing economies in China and India. They are building their own cars and they want to drive them. The other side of the equation is supply. Here in the States, the current administration has an interesting way of approaching the energy equation. In one sense, they say they want to limit our exposure to foreign energy. But the federal agencies are not permitting the exploration. We’re also getting into the season. It starts just before Memorial Weekend. About July 4^th, it really starts to peak and it stays there until Labor Day.

What do you do to protect your clients from a looming downturn?

You can tell that the market thinks inflation is going to come back. The industrial stocks are starting to move. You can participate in those sectors. What you have to do to protect yourself is to use a stop loss. You have to look at the charts and find where support is and you have to put a stop loss right below that level. If the price moves up, you continue to move that stop loss up.

So, cover your assets! Not losing is winning, right?

He who loses least wins!

People who have 401Ks don’t have access to stop losses. So, what do they do? Apply Modern Portfolio Theory and keep a percentage equal to their age safe? What’s safe?

If you have another source of income, Treasury Bills are a great failsafe. For those who don’t have the luxury of that and are looking for areas of the market to produce income for them. The electric and gas utilities pay 4-5% in dividends. You can look at AT&T and Verizon. Let’s face it; it’s a cell phone world. Most people are tethered to an electronic communication device. Pretty much everybody has a cell phone. Until the next wave of technology comes along and replaces those, the telecom companies have a monopoly right now. Those are pretty safe businesses that you don’t have to worry about. Their balance sheets are pretty clean. They didn’t take any bailout money. They’re able to meet their debt service.

What do you think of financials? They’ve enjoyed quite a rally recently.

If I had an implicit guarantee by the government, I’d be rallying too! I wouldn’t touch them with the longest pole that I could get. They still haven’t been cleaned up. We still don’t know what’s on their balance sheets.

Hmmm… Well, is there anything as hot as oil and as stable as a utility?

You know what is interesting is water. 97% of water is in the ocean. 2% are in glaciers. Only 1% of potable water is liquid. We believe that water is the next oil.

How do you play that? Buy Canada?

Look at the water utilities. California or Connecticut water service. Those are all regulated water utilities. The other way is to play desalination, the plant that takes water out of the ocean and makes fresh water. Consolidated Water Company builds and services desalination plants (symbol: CWCO). They own the Caribbean. Now they are building plants in Saudi Arabia, Jordan, Syria, Lebanon, and more.

Do they have any competitors?

They are like the 800-pound gorilla. This is a great long-term growth industry. Consolidated Water has paid dividends for the last 25 years uninterrupted. La Jolla is building a desalination plant and they just sold bonds.

I had Muriel Siebert on a few months ago, and she said buy water revenue bonds because water bills are a bill that everyone pays.

I like the water bonds better than I like the water utility stocks. The Federal Government could step in and claim eminent domain and cap the rates and that could hurt those guys.

Thanks Kelley. Interesting prediction and excellent tips!

Full Disclosure: Kelley Wright and/or his clients own positions in all of the companies mentioned in this article.

Kelley Wright is the author of Dividends Still Don’t Lie. Kelley Wright’s stock newsletter, IQTrends.com, has been outperforming its peers for decades, with 9.4% risk-adjusted returns on Wall Street for the past 20 years, according to Hulbert’s Financial Digest. To subscribe, go to IQTrends.com.

5 Important Tax Tips.  

by Natalie Pace.

Learn how to protect your assets from debt collectors and pay less to medical insurance and Uncle Sam, while beautifying your bottom line.  

Photo by: Stacie Isabella Turk, © 2008 Ribbonhead.com. Stylist: Melody White. Art Direction: Arlene Hylton-Campbell.

1. IRA Contributions:  You can still contribute to your IRA and receive credit for 2009.  (This is less money to the IRS and more money to you!)  Even if you have debt (and think you MUST pay down what you owe BEFORE you contribute to your IRA), please know that your pension, IRA, 401K, etc. cannot be levied by any debt collector, so it is very important to contribute to your own future FIRST, even as you work out any debt you might owe.  Your bill collectors are not going to pitch into take care of you if you lose your job, get sick or retire, so it’s important that you focus on providing for your future with the same earnestness that you pay off their high interest rates and penalties.

Learn more about contributing to your IRA NOW on the IRA contribution page at IRS.gov. If you use a software program, like Turbo Tax, they will automatically encourage you to make your IRA contribution before completing your tax form. Your accountant is likely doing the same, and it’s an excellent idea. (Simply search for IRA on the IRS.gov page.)

2. Haiti Contributions. Your Contribution Is Probably Deductible on Your 2009 Tax Return. Why wait for 2010 to declare your write-off, if you can benefit now? For more information, read my article, "Haiti," from the February 2010 ezine, Vol. 7, issue 2.

3. Health Savings Accounts. Here’s another way to increase your assets and beautify your bottom line, while giving less to Uncle Sam AND the insurance company. Health Savings Accounts work best for healthy people who have the ability to purchase catastrophic health insurance, while contributing to a tax-deductible retirement plan that can be invested for gains. Catastrophic insurance could save you hundreds of dollars in insurance premiums per month, some of which can be deposited into your HSA for investments and gains and eventually as part of our your retirement strategy. If you don’t need to dip into this account, it rolls over year after year until you retire. And in the meantime, you also get a write-off for contributing. You must be a "qualified individual," but opening a HSA through a bank or brokerage is easy. To learn more, visit IRS.Gov and enter Health Savings Accounts in the search box.

4. Free Federal Online Filing is the easiest way to do your taxes. For a list of qualified software companies, click on the FREE File icon on the home page at IRS.Gov. Many of these programs ask as many questions as most accountants and aim to include the deductions you qualify for. And it’s FREE!

5. FAQs. Wonder what tax laws have changed this year? What age your kids must be before you can no longer declare them? If you can claim a college student as a dependent? Check out the Frequently Asked Questions page of IRS.Gov.

About Natalie Pace:
Natalie Pace, is the author of You Vs. Wall Street and host of the Pace and Prosperity radio show on BlogTalkRadio.com/NataliePace! She is a repeat guest on FoxNews, CNBC, ABC TV and has contributed to Forbes.com, Sohu.com and BestEverYou.com and Magazine. As a philanthropist, she has helped to raise more than two million for Los Angeles public schools and financial literacy. Follow her on Twitter.com/NataliePace, YouTube.com/NataliePaceDOTCOM and Facebook.com. For more information please visit, http://www.nataliepace.com.

The Long-Term Unemployed: Consequences and Possible Cures.

by Dr. Gary S. Becker.

Greater unemployment is a casualty of every recession, and the so-called Great Recession is clearly no exception. The unemployment rate grew from under 5% to just over 10% at its peak, and has fallen during the past few months a little to 9.7%.  Most forecasters are predicting only a gradual further decline in the unemployment rate during 2010, and some even predict that this rate will increase before it continues to fall again. Aside from its level, the most disturbing feature of the unemployed is its composition since many of them have been without a regular job for over six months.

Men and women who are unemployed for a relatively short time-say for no more than a few months- create relatively few problems for themselves or the economy. They can usually finance their consumption while unemployed- such as on housing, food, and other basic expenses- out of their own savings, unemployment compensation payments, and from loans from family and friends.

The long-term unemployed are the major problem. And the fraction of the unemployed who have been out of work for six months or more increased greatly during the Great Recession to reach over 40% of the unemployed in February 2010. The average period of unemployment for these long -term unemployed is about 7 months. Only a year earlier, in February 2009, the long-term unemployed constituted only 22% of the total number of unemployed persons, and even that percent was up from its share of the unemployed at the beginning of the recession in December 2007.

The long-term unemployed tend to lose confidence in their abilities, their resources to finance their consumption gets depleted, and their skills begin to depreciate. They may be forced to uproot their families to move to new communities where employment is more readily available. As a result of all these factors, their family life undergoes considerable stress, which leads to marital problems, and not infrequently to divorce. These effects are all reasons why special attention has to be given to reducing the rate of long-term unemployment, and mitigating some of its harmful effects.

In most respects, the characteristics of the unemployed are similar during this recently ended recession as it has been during all prior recessions, and even the Great Depression of the 1930s. Unemployment is concentrated among the young, less educated, and low skilled. For example, according to the March 10^th report of the Bureau of Labor Statistics, (seasonally adjusted) unemployment rates in February of this year was 16% for high school dropouts, 11% for high school graduates, only 8% for persons with some college or associate degrees, and a quite low 5% for persons with a bachelor’s degree and higher levels of education. Similar differences are found by age and skill level. So despite all the attention given to the growth in the unemployment of highly educated persons from the financial sector, the burden of increased unemployment is still being mainly borne by the young and less skilled.

Although more educated and older workers are far less likely to become unemployed, once they do they have a much tougher time finding jobs that pay them close to what they had been getting while employed. This is why college educated and older workers constitute a much larger percent of the long term unemployed than they do of the total number unemployed. These differences in long-term unemployment are easy to understand. Many kinds of low paying jobs are available to the young and high school dropouts in all parts of the country.

This means that these workers can relatively easily find other jobs if they become unemployed, even though the new jobs may not last so long and they may have to seek still other jobs. Finding other jobs with comparable pay to their old ones is much harder for more skilled and experienced workers since they are more specialized in their knowledge. They may have to move to another region to get suitable employment.

The fraction of workers who have been unemployed for at least 6 months tends to rise for a while after a recession, even after the overall unemployment rate starts to fall. This is not surprising since the fact that a person has been unemployed for many months is an indication that he or she cannot easily find a new job. As a result, the long-term unemployed are less likely than other unemployed workers to find jobs quickly after the economy begins to pick up.

In several of the prior recessions, the unemployment rate came down slowly after the recession was over. The Great Recession ended during the third quarter of 2009, yet the unemployment rate continued to rise for a few months after that. It has now started to decline slowly, and is likely to continue to fall at a slow rate.

Regrettably, the decline may be particularly slow in the present situation because Congress and the President have created too much uncertainty about, among other things, health care costs to employers, taxes on higher incomes and on businesses, taxes on carbon emissions, caps on the pay of some executives, and the new regulations of lenders. Businesses are reluctant to take on many additional employees until they become more certain about their costs, and the direction the economy is moving in.

Unfortunately, several remedies that have been suggested to reduce the rate of long-term unemployment will be ineffective. For example, many people believe the solution is to retrain the long-term unemployed. However, retraining adults of all ages, but especially older workers, have generally been failures: it is much too costly relative to the benefits in terms of new jobs.

A current proposal in Washington is to give companies a subsidy if they hire workers who have been unemployed for longer than a few months. The problem with this proposal is that the Job Openings and Labor Turnover Survey (or JOLTS-I am indebted to Ed Lazear for bringing these data to my attention-) shows that even during this period of high unemployment, there are about four million new hires every month, and slightly more separations than that when employment is falling. So the great majority of the new hires that would receive a subsidy under such a proposal to stimulate employment would have occurred anyway. The program would end up being another costly subsidy to businesses.

The only real remedy for the long-term (and other) unemployed is to have the economy grow fast, as it did after the severe recession in 1982 when unemployment peaked in December of that year at 10.8%, and then fell rather rapidly. There is no magic bullet to accomplish this, but I do believe it would help a lot if the leaders in Washington did not try to radically transform various aspects of the economy while we are recovering from a serious recession, and thereby magnify the high degree of uncertainty that is typically caused by a recession. Instead, they should be concentrating on fighting the recession, and stimulating long-term economic growth.

About Gary Becker:
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." President George W. Bush awarded him the Presidential Medal of Freedom in 2007.

To keep track of Dr. Becker's continuing research and commentary, visit his web site and blog.

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Spring Rally! How Long Will It Last?

by Natalie Pace.

How Do You Turn Your Flowers Into Fruit?

Photo by: Stacie Isabella Turk. © 2008 Ribbonhead.com. Stylist: Melody White. Art Direction: Arlene Hylton-Campbell.

On March 1, 2010, my historical analysis predicted a Spring Rally. (You can link to that report in the article, "Stock Market Secrets," in the March 2010 ezine.) Since that report, NASDAQ is up 7% and the S&P500 is up 6% (as of March 29, 2010). Woo hoo! So, when will the rally end? And how can you position yourself to weather any storms that might occur during hurricane season (Sept/Oct.)? Well, first, be aware of the trends, and from there, it’s easy as a pie chart.

Seasonal Trends:

1. Top Performing Month: Used to be January. For the last ten years, on average, January has been one of the worst performing months. April has become the best performing month (presumably when good salesmen convince their clients to invest more).
   
   
2. Best Quarter: Used to be the Santa Rally, November through the end of January, where 50% of the market gains were run up. The best quarter over the last decade has been March, April and May. Meaning that the Spring Rally is the new Santa Rally, and the Santa Rally has been bringing coal in your stocking.
   
   
3. Worst Performing Months: Used to be September and October. (October is responsible for the worst days in market history, including Black Monday in 1987 and the Great Depression.) The worst performers for the last decade are October, February, January and June, in that order. Think of taking cover during hurricane season, and remember the former top-performing month of the year (January) is ice cold these days.
   
   
4. Market Volatility: The market volatility is enormous month to month and particularly, quarter to quarter, meaning that unless you want to compete with hedge fund managers, your best strategy is a plan that works in bull and bear markets. Avoid the daily horrors and hype that are called news, and your nest egg stands a better chance of growing. Remember however, that buy and hold doesn’t work anymore either! Annual rebalancing and Modern Portfolio Theory do. These strategies are outlined in You Vs. Wall Street, which is why it is so important to buy and read this book and convince your friends to, as well.

Source: Standard and Poor’s and NataliePace.com. © 2010

Election Year Trends:

1. Over the last decade, on average, the 2^nd year after an election has been a negative year for the stock markets. Over the last forty years, the second year of a presidential term has been the worst performing year in the election year cycle. 2010 is the second year after an election year, which means that, after the Spring Rally, we could need shelter for Hurricane Season.
   
   
2. Pre-Election Years are still the top performing years of the election year cycle – by far. Pre-election years have earned 17% gains on average (annualized) over the last decade and 22% for the last 40 years. 2011 is a pre-election year!

Source: Standard and Poor’s and NataliePace.com. © 2010

So how do you capitalize on the Spring Rally?
The Spring Rally is a great time to rebalance your portfolio, once you’ve enjoyed some gains! For the last 25 years, the rally has continued through the end of May, with June being sluggish or negative. So, be sure to Sell at the end of May before you Go Away on your vacation. And by "selling" I don’t mean selling off everything you own, market timing or any other gambling technique. I mean rebalancing and capturing any gains you’ve realized, and making your nest egg look like the pie chart that I illustrate on page 92 of You Vs. Wall Street.

If you don’t know what a balanced portfolio looks like, be sure to read my article, "Easy as a Pie Chart Investing," from the February 2010 ezine, in addition to my book, You Vs. Wall Street. In a turbulent, downtrending year, as the 2^nd year of a presidential term can be, think about overweighting 15-20% additional safe, until the start of the pre-election year, in late February of 2011.

What’s safe?
Not your bond funds anymore. When interest rates rise, the value of low-yielding bonds goes down. In other words, no one is going to want to own your 4%, 10-year municipal bond next year, if the new bonds are issued at 7%. Bond funds will suffer in the short term as well when interest rates start to rise.

If you have bonds that you purchased previously that have a decent yield, those are safe, provided the company or entity behind the bond is still credit-worthy (so check into that). New bonds must be considered with the forensic eye of Sherlock Holmes – making sure they are not high-risk or at risk of losing principle value, due to the fact that interest rates are going to have to rise in the future (6-18 months from now perhaps), off of their 40-year lows. To learn more about why bond values go down when interest rates rise, read "Should You Worry About Bond Funds if Interest  Rates Rise?" from the March 2010 ezine, Vol. 7, issue 3.

So… the easiest place for safe, liquid investments, for now, will be Treasury Bills and FDIC insured money markets and Certificates of Deposit. You might also think about diversifying your "safe" money into income property in a stable environment (near a popular university) that is cash positive with a cushion of 20% profit margin (over and above all of your costs to carry). Hard assets are longer-term investments and harder to get rid of if you need the cash. But on the other hand, they can be a stable source of income in a recession, provided you are not over-leveraged, or the local economy doesn’t impact your rental income.

In a downtrending marketplace, not losing is winning, so don’t be lured into risky investments by people who tell you that CDs and T-bills are making less than half a percent in interest.  Not losing is winning in a recession.  (If your dollar is worth a dollar when everyone else’s dollar has gone down to 70 cents, that’s a good position to be in.) You’ll be in a position to buy their former assets on sale, when money is tight and buyers are fewer (because so many people lost so much principal by not adhering to sound investment strategies).  Also, if you have yourself diversified into hot industries, and are underweighting the bailed-out, faded Blue Chips, then you’ll be making more gains in the portion of your portfolio that you have at risk than most investors.

About Natalie Pace:
Natalie Pace, is the author of You Vs. Wall Street and host of the Pace and Prosperity radio show on BlogTalkRadio.com/NataliePace! She is a repeat guest on FoxNews, CNBC, ABC TV and has contributed to Forbes.com, Sohu.com and BestEverYou.com and Magazine. As a philanthropist, she has helped to raise more than two million for Los Angeles public schools and financial literacy. Follow her on Twitter.com/NataliePace, YouTube.com/NataliePaceDOTCOM and Facebook.com. 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 all in on any asset class or individual stocks. 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.

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.

The Top Eleven Investing Mistakes.

by Natalie Pace.

Excerpt from You Vs. Wall Street. Published with permission from Perseus Books and the Vanguard Press.

Investing mistakes are easy to make because doing what everyone else is doing feels like a time-saver. Just follow the herd, no research or thought required. But the common mistakes you’ll learn about in this chapter are not time-savers at all. They’re money losers, stomach-acid burners, and sometimes even relationship deal-breakers.

Even if you know better than to fall into the pits of these common investing mistakes, you might still find yourself tempted to cut corners, just to fit in with your friends, appease your money manager or to save time. Overzealous friends (and TV personalities) can often try to convince you to do something that you (now) know you shouldn’t be doing.

Mistake # 1: Following Analyst (or Pundit) Recommendations
Remember Jim Cramer’s now famous rant about how stupid you would be to take your money out of Bear Stearns? Six days later, the company’s share price fell from $62 to under $2/share and if the government had not stepped into bail the company out, shareholders would have been left with toilet paper.

Whether you think the wild man Jim just had a case of bad luck (or worse that he might have friends at Bear), his colossal mistake of a call is not a fluke. Following analyst recommendations is a losing proposition. Researchers at the University of California and Stanford University found that, in the year 2000, the stocks most highly rated by analysts lost 31 percent for the year. Even more incredible is this finding from the study: The stocks least favored by the major analysts soared 49 percent. This study examined 40,000 stock recommendations from 213 brokerages. Analysts and pundits are not all crooks, but they are definitely not fortune-tellers.

Mistake #2: Bankruptcy Buying
Think buying General Motors at $1.54 a share is a brilliant idea because you’re positive that they’ll come out of bankruptcy? Guess again. Reorganization plans commonly call for the cancellation of the existing common stock, with holders receiving nothing. Nada. Even for a century-old American legacy, like General Motors.

Mistake #3: Scooping Up "Pet Rocks"
It’s very tempting to buy stock after shareholders have earned seven thousand times their investment or after the product sells four gazillion copies, but that is chasing money (not making money). You’ll see that Google and Apple swing between share prices that are half the price of what they are trading for today. Don’t be in a hurry to buy at the top of the market.

Mistake #4: Chasing Hot Tips
Hot tips that you receive on bulletin boards, through email, by fax and even out of the mouth of friends are often merely "pump and dump" schemes. Insiders pay marketers to pump up the stock, so they can quickly dump when enough suckers fall for the charade and buy. Assume hot tips are swampland in Florida unless proven otherwise by the due diligence you do with your Stock Report Card and the Four Questions for Picking a Winner (found in the pages of You Vs. Wall Street). Assume anyone who tells you that they have a "sure shot" that’s going to double, is lying, self-interested, or, if it’s a friend, maybe just gullible. Enron employees were giving out hot tips to their friends to buy stock—which turned out to be a complete fraud.

Mistake #5: Taking "Sure Shots"
Sure shots are slightly different from hot tips in that someone is assuring you that you will make a lot of money free and easy right now if you just do this or that investment trick. Time is always of the essence, as is secrecy, and you’ll miss the opportunity if you insist on reading all the fine print. Secrecy and expediency are hallmarks of scams and fraud. It might be "secured" third mortgages to distressed subprime borrowers. It might be a hedge fund run by someone who made 1000 percent gains last year. It might be an official trying to sneak money out of a corrupt country or a "lottery" you’ve won that requires your credit card number for shipping purposes.

Beware anytime someone wants you to hand over money before you have a chance to do proper due diligence, and understand that a genius must have excellent returns over a decade – through bull and bear markets – to qualify as experienced enough to offer you guidance.

Mistake #6: Panicking (or Swooning) over Front Page Headlines
Headlines are written by editors to catch your eye. If you don’t read the fine print, you could be missing the most important information. The headlines of less respected news sources can be even further from the complete story because some "news outlets" have been known to just print the press release (which was written by the company).

Mistake #7: Falling for Company Hype
If you’re researching online, you might come across a press release that looks just like a news report. However, press releases are written by professional writers, who are employed by the company they are writing about, not by independent journalists. A company can talk about an increase in revenue without ever mentioning that increased revenues don’t mean the company is profitable or that, due to cash constraints, the company’s about to declare bankruptcy. If you read anything that is from PRNewsWire or BusinessWire—services that distribute press releases written by corporate PR people—ask yourself, "What aren’t they telling me?" Press releases can have valuable data and information, but they are designed to give you a snapshot of something newsworthy, not to draw the full picture of health of the company.

Mistake #8: Having Blind Faith
Brokers are salesmen. Most brokers make their living by selling you real estate, mortgages, mutual funds and other investments and by taking a commission on the sale. There is no degree or years of study required, though brokers do have to complete some education related to their field. In other words, today’s broker could be yesterday’s rodeo rider or actress. Many investors place far too much faith in their broker’s knowledge, morals, and information. Many brokers don’t really know the prognosis for the market they represent and are simply selling whatever product their company tells them to sell. You wouldn’t marry a stranger, so don’t hand your financial life over to one either!

Mistake #9: Betting on the "Hail Mary" Investment
Don’t bet your livelihood on one Hail Mary investment! Diversify! When stocks go up, real estate might be flat. Other times, bonds are doing great. By having all of these assets, and buying and selling at opportune moments, you’ll keep increasing your assets in any marketplace. Make sure that you keep enough cash on hand and enough income flowing in to meet your expenses and allow you to buy on opportunity, when the rest of the marketplace is hurting. When considering any investment, consider the cost to carry when evaluating your Return on Investment.

Mistake #10: Keeping Too Much Stock in Your Employer’s Company
ARISA guidelines state that you should have no more than 10 percent of stock in your own company. Any employee who has seen their company declare bankruptcy (think auto manufacturers, airlines and Enron) or decline dramatically in value (think banks and brokerages) wish that they’d known this.

Mistake #11: Employing Friends and Lovers
I’ve spoken with women executives who have commanded billion-dollar corporations and others who have multi-million dollar salaries, who turned over their personal investment portfolios to a husband in order to make him feel "more manly." With men, it’s more likely to be the guy at the country club who convinces his poker partners to come in on a sure shot investment of his.

Money means different things to different people, but, chances are high, that whatever it means to you, it ranks in the red on your personal Richter scale when tremors occur. If your friend, loved one or relative loses your money, it’s going to be hard to recover the relationship—no matter how much you like or love that person.

So, even though you might think it’s an act of love to entrust your future to someone, it’s potentially an act of annihilation. Somewhere down the road, that person can make a bad decision (in your eyes), or there will be less money than you hoped for (if any at all), or there will be a falling out between the two of you, or simply the person wasn’t really qualified for that level of responsibility in the first place. Remember that selecting your financial partner is the second most important decision you make.

Even if you hate investing, almost anyone can set up an auto-payment, tax-free, diversified retirement account through an online discount brokerage in just a few minutes. Take at least that amount of time. And realize as well, that it is pretty hard to create something when you pay no attention to it. Forget to water and tend to your plants and they’ll die. So, will your money tree.

Three Takeaway Tips
1. Turn off the news. If you’re trading on headlines, you’re late.
2. Ignore hot tips, sure shots, company hype, chasing returns and trading on analyst recommendations.
3. Distinguish between investigative financial news, press releases and smaller news organizations, which are mostly just reprinting the information found in press releases. Ask yourself, "What aren’t they telling me?"

About Natalie Pace:
Natalie Pace, is the author of You Vs. Wall Street and host of the Pace and Prosperity radio show on BlogTalkRadio.com/NataliePace! She is a repeat guest on FoxNews, CNBC, ABC TV and has contributed to Forbes.com, Sohu.com and BestEverYou.com and Magazine. As a philanthropist, she has helped to raise more than two million for Los Angeles public schools and financial literacy. Follow her on Twitter.com/NataliePace, YouTube.com/NataliePaceDOTCOM and Facebook.com. For more information please visit, http://www.nataliepace.com.

Fed Stands Pat … But for How Much Longer?

by Liz Ann Sonders, Senior Vice President, Chief Investment Strategist, Charles Schwab & Co., Inc. 

March 16, 2010

Key points

However, not until the recovery gets a lot more of the respect that Rodney Dangerfield was lacking should we expect the beginning of a rising-rate cycle.

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

All expressions of opinion are subject to change without notice in reaction to shifting market conditions. Data contained herein from third party providers is obtained from what are considered reliable sources. However, its accuracy, completeness or reliability cannot be guaranteed.

Examples provided are for illustrative (or "informational") purposes only and not intended to be reflective of results you can expect to achieve.

College Savings Plans—School Yourself Before You Invest.

A FINRA.org Investor Alert.

We all want to get our money's worth. This is true when it comes to paying for a college education—but it's also true when it comes to investing for higher education. Since 1997, investors have had the opportunity to contribute to Section 529 college savings plans, which offer tax advantages that have made them a popular investment vehicle for saving for college. The good news is that there is no shortage of college savings plans to choose from—especially given the fact that in many cases you do not need to be a resident of a state to invest in that state's college savings plan. But select with care! Virtually no two plans are the same. Doing your 529 homework is essential because:

• Contribution limits vary by state.
• State tax advantages vary from state to state and may depend on whether you are a resident of the state sponsoring the plan.
• Investment options vary greatly—from higher risk stock funds, to funds that contain a mix of stocks and bonds, to conservative investments that contain money market or conservative short-term bond funds. Most plans offer age- or enrollment-based investments that grow more conservatively over time as the beneficiary gets closer to using the proceeds to pay for college expenses. Many plans also offer static investments where assets are typically invested in a set allocation of one or more mutual funds.
• Fees and expenses vary greatly, even among plans offered within the same state.

Reason for Concern
We are issuing this Alert because we are concerned that investors may be shortchanging themselves by investing in 529 college savings plans with high fees, plans that currently do not offer them state tax benefits, or both. This Alert provides an overview of 529 college savings plans, information concerning fees and expenses, and a specific caution about investing in out-of-state plans. The Alert also provides you with 8 easy lessons that, if followed, will help you make smart college savings plan choices.

What are 529 Plans?
Named after the section of the federal tax code that governs them, 529 plans are tax-advantaged programs that help families save for college. There are two types—prepaid-tuition plans and college savings plans. Every state offers at least one of these types of plans. This Alert focuses exclusively on the more than 80 state-sponsored college savings plans in which money is usually invested in a group of portfolios made up of mutual funds, and withdrawals can be used for college costs, including tuition, fees, room, board, textbooks, even computers when required for college.

How College Savings Plans are Sold to Investors
There are two ways that college savings plans can be sold to investors:

• "Direct-Sold College Savings Plans" in which you buy an interest in the college saving plan directly from a broker-dealer on behalf of the state, the state that sponsors the plan, or from the plan's program manager, with no sales person involved; and
• "Broker-Sold College Savings Plans" in which you buy an interest in a college saving plan through an investment adviser, brokerage firm, or bank, generally paying a sales load or fee.

The brokerage community has done a fine job of educating investors about the benefits of 529 investing, but investors should take heed:

• Some brokerage firms and advisers offer only one or a very limited number of 529 plans. The options may not include your own state's college saving plan and may not provide you the opportunity to invest in college savings plans issued by other states, even though those other 529 plans may have lower sales loads, lower expenses, or may provide state tax advantages that are not available when invested in the plan being offered.
• Broker-sold plans often contain sales loads and higher fees and expenses than direct-sold plans.

Don't Overlook State Tax Advantages.
Federal tax advantages are a major benefit of investing in 529 plans. When you invest in a 529 plan, your earnings grow tax-free. Furthermore, qualified withdrawals are also tax-free when used for qualified education expenses.

While federal tax advantages are standard to all college savings plans, state tax treatment of 529 plans varies from state to state and can be a factor in deciding which plan to select. In over 30 states, contributions are either tax deductible if you're a resident of the state sponsoring the 529 plan or you can receive a tax credit for contributions. In five of those states—Arizona, Kansas, Maine, Missouri and Pennsylvania—you can claim a state tax deduction from any 529, regardless of its location. Deductions and tax credits vary from state to state. For example, Colorado currently allows residents to deduct the entire amount of their contribution to their in-state plan for each beneficiary, up to the amount of their annual gross income. Rhode Island, on the other hand, allows only a $1000 deduction in total for joint filers and $500 for single filers. Many states also follow the federal tax lead of allowing earnings to grow tax-free and imposing no state tax on qualified withdrawals from in-state and out-of-state plans.

States Offering Tax Deductions or Credits to In-State Investors

Several states impose taxes on qualified withdrawals from out-of-state plans and a few tax earnings on out-of-state plans. In an effort to keep money in its own state plan, New York even "recaptures" state income tax deductions that were given to state residents who move money from the New York college savings plan to a college savings plan in another state.

In many cases, the smart move is to check out a plan in your home state—especially if your state allows you to deduct some or all of your 529 contributions, but always do the math to evaluate the value to you of any state tax benefit.

Remember: the tax rules that apply to college investing options are complicated. Before investing, you may want to check with your tax advisor about the tax consequences of investing in college savings plans or read Internal Revenue Service Publication 970, Tax Benefits for Higher Education.

Don't Flunk 529 Investing
As we found, investors can be persuaded to put money in a 529 college-savings plan that offers them no in-state tax breaks. Here's how it can happen:

A couple from Colorado receives a call from a broker who recommends a 529 Plan in another state. The couple invests $10,000. The plan may have similar fees and expenses to their home-state plan, and it offers the couple the same federal tax incentives available to all 529 investors. But it DOES NOT give them any state-tax benefits. In Colorado, those benefits are substantial: they are fully deductable up to the contributor’s adjusted gross income. Colorado’s income tax is a flat 4.63 percent of federal taxable income, so a $10,000 investment in an out-of-state plan meant missing out on $463 worth of Colorado tax incentives—money that could itself be invested to pay for college expenses.

NOTE: There may also be instances where a plan offers in-state tax breaks which are offset by higher plan fees or poor investment performance.

Compare Fees and Expenses
All 529 college savings plans contain fees and expenses. These costs not only vary among 529 plans but also can vary within a single 529 plan. Fees may include: enrollment charges, annual maintenance fees, sales loads, deferred sales charges paid when you withdraw your money, administration and management fees (often called the expense ratio), and underlying fund expenses.

It bears restating that broker-sold plans often cost more than direct-sold plans. Typically, these additional costs take the form of front-end sales loads or other fees associated with share classes (described below), and annual distribution fees, including service fees that compensate the financial professional, who provides guidance in selecting a plan and managing your savings.

Be Alert to Share Class Costs
The decision process is made even more challenging because some broker-sold college savings plans, like some mutual funds, have different share classes. Often referred to as Class A, B, or C shares; each class has different fees and expenses. Inspect the offering document carefully with an eye to whether a particular college savings plan offers more than one class.

College Savings Plan Share Class Costs Comparison Chart

In many cases, in-state residents can avoid these extra expenses by buying the plan directly from the state. Some college savings plans even allow non-residents to avoid these extra expenses by buying shares in a direct-sold plan. However, if you buy directly from the state or its program manager, you won't receive the assistance of a broker or financial professional, which may be important to you.

In sum, take the time to research all fees and expenses and carefully compare plans. Costs can add up, diminishing any tax incentives a 529 plan may offer.

Use FINRA's 529 College Savings Plan Expense Analyzer
Because fees and expenses can vary widely from plan to plan, FINRA has developed a tool to help you compare how these fees and expenses can impact returns. The analyzer is designed to work with most college savings plans. It explains the various fees and provides guidance about where to find them in 529 disclosure documents. It also provides prompts that help ensure the best possible comparison between plans. Try it now.

Be Wary of 529 Plan Ratings.
Several Web sites and publications rate 529 plans and some states tout the rating their plans received. Make sure you understand the basis for these ratings. Some third-party ratings systems appear to give little weight to state tax benefits or low expenses.

School Yourself!
Here are 8 lessons that, if followed, will help you make smart college savings plan choices:

1. Start with your home state first when looking for a college savings plan. Pay special attention to state tax breaks and fees that are waived or lowered for in-state residents.
2. Consider the plan's investment options.
3. Be aware that broker-sold plans are generally more expensive than direct-sold plans. If you're comfortable going it alone, you can often save money investing in a direct-sold plan.
4. Remember that one size does not fit all. Some brokerage firms and advisers offer only one or a very limited number of 529 plans and do not provide investors the opportunity to invest in college savings plans issued by other states, even though those other 529 plans may have lower sales loads and lower expenses, may provide state tax advantages that are absent from the plans being offered, or may have better investment options.
5. Ask questions. If you are investing on your own, call the toll-free numbers posted on the state-sponsored sites. If you are working with a broker or financial professional, don't hesitate to ask:
• How many different college savings plans do you offer?
• Can I claim a state-tax deduction on contributions to the college saving plan you're recommending?
• How much will I pay in fees and expenses?
• Do the fees and expenses outstrip any tax savings I may achieve?
6. Compare expenses, especially if your state offers both broker-sold and direct-sold plans and if you are considering investing in an out-of-state plan.
7. Independently verify sales information you receive by thoroughly reading the official disclosure documentation.
8. Make sure the investment meets your objectives and that you understand and are comfortable with the risks, costs, and liquidity of the investment. Never invest in a product you don't understand.

Consider a Variety of College Savings Options
Finally, do not limit your research to college savings plans alone-there are a number of other tax advantaged college savings options you can consider. These include:

• Prepaid Tuition Plans
• Educational Saving Accounts
• Custodial Accounts
• Savings Bonds

You can learn about college savings plans and each of these other college savings options in FINRA's Smart Saving for College learning center.

More Information
For more information on 529 plans visit these links and Web sites:
Smart Saving for College
Understanding Mutual Fund Share Classes
CSPN College Savings Plans Network
Internal Revenue Service Publication 970, Tax Benefits for Higher Education

Press Release—NASD Fines Chase Investment Services, MetLife Securities $500,000 Each for Supervisory Violations in 529 College Savings Plan Sales
Press Release—NASD Fines Ameriprise Financial Services, Inc. $500,000 for Supervisory Violations in 529 College Savings Plan Sales

To receive the latest Investor Alerts and other important investor information sign up for Investor News.

About FINRA:
The Financial Industry Regulatory Authority (FINRA), is the largest independent regulator for all securities firms doing business in the United States. All told, FINRA oversees nearly 4,800 brokerage firms, about 170,400 branch offices and approximately 643,000 registered securities representatives.

FINRA believes investor protection begins with education. Using the Internet, the media and public forums, we help investors build their financial knowledge and provide them with essential tools to better understand the markets and basic principles of saving and investing.

Fruit of Thought on the Money Tree.

by Natalie Pace.

10 Ways to Thrive and Prosper This Spring.

Spring is the perfect time to make sure that your flowers bloom and yield fruit in the summer. So, if you weren’t pleased with last year’s Wall Street harvest, it’s time to make sure that you have pruned, watered and fertilized properly to get better results in 2010.

1. It is impossible to create something when you pay no attention to it. Forget to water and tend to your plants and they’ll die. So, will your money tree. Now is the perfect time to make sure that your 401K, IRA, pension, etc. are all pruned and watered, ready to flower, to yield fruit in the summer and withstand hurricane season! (Consider coming to a Get Rich and Enrich Retreat, where you will learn nest egg strategies that work in bull and bear markets. Buy and Hold doesn’t work anymore! Call 866.476.7442 to learn more or visit the home page at NataliePace.com and click on the Get Rich and Enrich banner ad.)
   
   
2. Water and fertilize your money tree; don’t expect it to grow in the desert of ignorance. If you check off boxes blindly in your 401K, then you’ll continue to have a turbulent ride. Some pundits are predicting another challenging year on Wall Street (after the Spring Rally). If you felt helpless and desperate at the March 2009 lows, when the Dow Jones Industrial Average bottomed out at 6547, and you haven’t made any changes to your 401K, IRA, etc., you are just as vulnerable now as you were then. It’s like being a pilot in a storm who doesn’t have the first clue of how to fly, compared to a pilot who knows that just 500 feet above the clouds, it’s smooth sailing! There is a better plan.
   
   
3. Here’s a hint: If your nest egg cracked before and you haven't made any changes, it can crack again. There is a better way for your nest egg. Ask your questions on our Natalie Pace Facebook fan page at the link below. I answer Qs directly there and also post daily money tips and market updates!
   
   
4. You spend hundreds of thousands of dollars learning how to earn income, why not spend a fraction of that learning how to invest, so that you can make money while you sleep (instead of losing money and sleep while you watch the market volatility in shock and horror).  Most nest eggs are worth a lot more than anyone earns in a lifetime...  Very valuable, and worthy of your time, wisdom and care.

Save $160,000 or Invest to Become a Millionaire



5. When you are AGAINST something, be FOR the solution. If you are feeling *#^&*@ about your bailed out bank, seek out a credit union or brokerage that has better policies and a healthier bottom line for your accounts. Learn how to trim the bailouts and bankruptcies from your nest egg. (If you don’t know what you own in your funds, chances are you own the bailouts in your 401K since over 10% of the Dow Jones Industrial Average was bailed out and that is the most popular Blue Chip Index on Wall Street).
   
   
6. Laughter and fun and right action and wisdom are far more fun than whining and complaining, so you'll find that if you power up on positive vibes (and lower the volume on the victim thing) and have a good blueprint that allows for a healthy relationship with prosperity, abundance, budgeting, investing, thriving and creating awesome new income/businesses/ relationship paradigms, all you have to do is show up and shine and watch the magic happen. When you are in gold fever/lottery/gambling mode, it is an all or nothing proposition that often turns your golden egg into a goose egg within a very short period of time, even if you do manage to win big for now.
   
   
7. There comes a time when we realize that we create our world. We create our world. The world We Americans create. The world We Afghanis Create. We Chinese. We Inca. We Kindergarten. We PhDs. We "women can vote." We "children don't have to work 12-hour days in a factory." We Luck O the Irish. Let's co-create something worthy of being remembered. "They" bow to the higher calling every time. They – we don’t want no civil rights. They – we don’t want no women voting. They – we going to bail out these here banks (and let them hoard their dough and gouge your mortgage in the process). So claim your power and create something worthy of being remembered. Be a part of the solutions. Please. (Your money tree will prosper with that tending, and so will our nation.)
   
   
8. Every cent you own and every moment you spend is always an investment. Invest more time in the bar stool than on the kids’ soccer field and your family might leave you. Invest more money in looking rich rather than being valuable and your credit card companies might repossess you. Invest your time and money with wisdom and right action and the stars light up your path to abundance. Invest your time and money wisely in the best companies on Wall Street and you’ll get rich (provided you rebalance annually, diversify and always keep a percentage equal to your age safe).
   
   
9. When you start investing in things that you know and love, instead of with fear and greed, your life will change immediately, and this world will become a much more beautiful place. A life like this increases in value every single day and becomes more valuable not just to you but to those around you as well.
   
   
10. We all have more power than we realize -- and there is within each one of us the power to shift our circumstances.  But change is an action verb.  Knowing which direction to move in requires a divine/meditative process and moving in a smart direction.  But you must have action, for change to occur. (Have you noticed that whiners don't seem to want to change -- that's the point I guess... to complain, not to course correct...) So, don’t whine about how your broker or spouse lost all of your money. Become the architect of your dream life and understand that the people you hire to work for you – even those who manage your money – are there to serve you, not take responsibility for you. If they lose your money, it is still your loss, not theirs. So, have a plan and hire people to implement it.

About Natalie Pace:
Natalie Pace, is the author of You Vs. Wall Street and host of the Pace and Prosperity radio show on BlogTalkRadio.com/NataliePace! She is a repeat guest on FoxNews, CNBC, ABC TV and has contributed to Forbes.com, Sohu.com and BestEverYou.com and Magazine. As a philanthropist, she has helped to raise more than two million for Los Angeles public schools and financial literacy. Follow her on Twitter.com/NataliePace, YouTube.com/NataliePaceDOTCOM and Facebook.com. For more information please visit, http://www.nataliepace.com.

April Blooms on Wall Street. By Natalie Pace.

by Natalie Pace.

Includes my Hot News on Cool Stocks List.

March 30, 2010

General Stock Market Performance

Wall Street Highs/Lows in the New Millennium:

Compare those returns to the returns of stocks, real estate, bonds, Treasury bills and gold over the last 30 years.

Market Update:
Spring Rally! Enjoy! Any hurt, pain and suffering you experienced last March 2009, when the Dow dropped to 6547, is gone! Woo hoo! However, rather than rest on your laurels, I suggest you use this opportunity to make sure that you never experience that kind of pain again. In other words, if your nest egg wasn’t recession-proofed before the March 2009 implosion, and you haven’t made any changes since then, you’re vulnerable to a sequel.

Important Considerations in this "Jobless Recovery"
There were 25 bank failures in 2008,140 in 2009, and 41 (as of March 30, 2010) so far this year, according to the FDIC, putting this year’s bank failure rate on track to exceed the failures in 2009. That means it is critically important to make sure that your Certificates of Deposit, savings, money markets, etc. are FDIC-insured. Better to bet on a bailed out bank that is FDIC-insured than an unknown, non-insured private bank. Check and see where your accounts are housed.

"Household spending… remains constrained by high unemployment, modest income growth, lower housing wealth, and tight credit… Employers remain reluctant to add to payrolls," according to the Federal Open Market Committee press release of March 16, 2010. What does that mean? That once the FOMC stops fueling the economy with free, easy money, the consumers and businesses will have to pick up the slack. And they don’t look healthy enough to spark a rally – yet.

This is the 2^nd year of an election cycle. 2^nd years are typically the lowest performing year in the four-year cycle. See below for how 2002 performed (which was the second year of Bush’s first term and the third year of the DOT COM recession).

No one has a crystal ball, but we do know that Modern Portfolio Theory, proper diversification, avoiding the Bailouts, capitalizing on Hot Industries and annual rebalancing works. All of these strategies are outlined in my new paperback, You Vs. Wall Street. If you want to learn the strategies, I encourage you to read the book! If you want to implement the strategies now, while the markets have experienced such a nice recovery, please call 866.476.7442 NOW to register for the next Get Rich and Enrich Retreat.

You vs. Wall Street "provides almost fool proof methods for growing wealth for the long haul," according to Success Magazine. Readers call You Vs. Wall Street a "must-read financial bible," and "just what some readers need to find themselves exponentially richer in the coming years." You vs. Wall Street teaches you how to win on Wall Street in any market—bull or bear. Now is the time to choose wisdom over blind faith, to invest in winning companies and to whistle all the way to your local bailed out bank.

Track Record of our Reporting
While the markets are still down significantly since their high in October of 2007, the Hot News and Cooling Off lists below have a winning track record – in bear and bull market years. 83 positions listed below – 78% -- 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 twenty-four of our listings went in the opposite direction of the reporting, which is quite impressive given the horrible market drop of 2008-2009. FYI: The trend of the Spring Rally is expected to continue until the end of May, and then, if this year tracks the historical trend, the summer doldrums and particularly the Hurricane Season could be hard on the markets.

Yes, many, but not all, of our top performers were 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 four out of six Company of the Year selections were superperformers. 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.)

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 -- which is why I added options training to my 3-day Get Rich and Green Investing Retreat. Look on the Cooling Off list 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 
6. 2008 Recession (Get Safe)

Market Movers:
The Federal Open Market Committee and Monetary Policy
The Fed funds rate continues to be "0 to ¼ percent." Chairman Ben Bernanke testified before the Committee on Financial Services, U.S. House of Representatives on February 24, 2010 about the economy, saying "the impetus provided by the inventory cycle is temporary, and as the fiscal support for economic growth likely will diminish later this year, a sustained recovery will depend on continued growth in private-sector final demand for goods and services."

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 is far enough away that Fed Fund rates will remain exceptionally low for an "extended period."

The next FOMC meeting takes place on April 27-28, 2010.

Final Estimate GDP growth rates for 4Q 2009 were 5.6%, according to the Bureau of Economic Analysis. Massive government spending is the main driver of the economy at this point. The Cash for Clunkers Program was responsible for over half of the GDP growth (1.45%) in the 3Q 2009.

Advance Estimate GDP growth rates for 1Q 2010 will be released on April 30, 2010 at 8:30 a.m. ET. These release days tend to be very active on Wall Street. There were 25 bank failures in 2008,140 in 2009, and 41 (as of March 30, 2010) so far this year, according to the FDIC. More are expected in 2010. 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 March 16, 2010 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: 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,  Wednesdays at 9:00 a.m. PT.   There I interview experts on everything from gold, to health, to stocks, to bestselling books. Get real answers to your questions — anonymously (just pick a nickname when you call in). All of the shows are available for free as a Pod Cast. Just click on iTunes icon to access the library of over 25 shows available to you.

Get call-in and log-in instructions for the next show 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 and the NataliePace.com group on Facebook, so that you can Tweet and FB during 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! This month we want to know who you are rooting for on the Celebrity Apprentice, how you are feeling about real estate and what you’re doing for summer vacation.

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 March 18, 2010 at 2:30 p.m. CET. (April 8, 2010 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)
Green Dot (this is an IPO; not publicly traded yet)
Suntech Power Holdings (STP)

Profit-Taking (Take your profits early and often):
Hoku Corp. (HOKU) +30%
LDK Solar (LDK) +33%
U.S. Gold (UXG) +542%

DELETIONS (Take your profits early and often):
None

HOT NEWS on COOL STOCKS LIST

Recently Deleted Companies 2008-2010:
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%. Deleted the New Zealand dollar currency ETF by Wisdom Tree with 36% gains on 12.12.09. 12.18.09: Deleted Ener1 with 22% gains and Satcon with 29% gains. Deleted 1.11.10: KCI with 88% gains!

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. Getting the price right is as important as picking the right company. Never pay retail!

Recent Additions:
Allscripts Misys Healthcare Solutions (MDRX)
VMWare (VMW)

Recent Deletions:
Toyota Motor Company (TM). Moved to Cooling Off list on 2.12.10.

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):
None

(Why buck the trend? For the last 10 years, March-May have been positive months…)

DELETIONS:
None

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.

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:

Hobnob with Presidents at the Clinton Global Initiative University Conference in Florida and with Billionaires at the Milken Global Conference in Beverly Hills. Discover networking, education and enrichment opportunities in the Calendar Section.

Carolyne Manchara, Mary Mwende Alex, President Clinton, Linda Lockhart and Khadija Abdulla Said (from left to right). Photo Credit: The Clinton Global Initiative © 2009 Carolyne, Mary, Linda and Khadija are in the Global Give Back Circle.

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.

Get Rich and Enrich Retreat, Santa Monica, CA
April 1-3, 2010
You spend hundreds of thousands learning how to earn money. Why not spend a fraction of that learning how to invest? 3 days in a boardroom setting, learning investing directly from Natalie Pace, sets you up for life. April 1-3, 2010.

Wagner's GÖTTERDÄMMERUNG at LA Opera
Saturday, April 3rd, 2010
1:00PM through 5:00PM PT
The Ring's final chapter celebrates the human spirit with unforgettable music that soars to the heights of heroism. Wagner takes you on an incredible journey.

Clinton Global Iniative University Conference, Miami, FL
Friday, April 16th, 2010
This 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 doesn't hurt! You must apply. Act fast.

Asia-Pacific Conference at USC, CA
Monday, April 19th, 2010
Asia Pacific nations’ responses to climate change are driving the rapid development of green business sectors. Learn what countries are doing and where the best opportunities are.

Profit From Your Passions. Radio Show
Wednesday, April 21st, 2010
9:00AM through 9:30AM
Jay Leno has amassed a collection of cars. Donald Trump has his prime real estate. What's your passion? Learn how to turn what you love into a stunningly beautiful bottom line.

Agape Spring Meditation Retreat, Malibu, CA
Wednesday, April 21-23, 2010
Michael Bernard Beckwith and musical artist Rickie Byars Beckwith lead a retreat rich in meditation, music, silence and yoga at the stunning Serra Retreat in Malibu, CA. April 21-23, 2010

The Milken Global Conference, Beverly Hills
Monday, April 26-28, 2010
This 3-day conference brings together some of the most extraordinary people in the world – business executives, institutional investors, asset managers, government leaders, academics and Nobel laureates. Network, share & learn.

FOMC Meeting
Tuesday, April 27-28, 2010
The Federal Open Market Committee meets to determine Federal Reserve policy in the U.S. Two-day meeting April 27-28, 2010.

GDP 1Q 2010 report (advance estimates)
Friday, April 30th, 2010
8:30AM through 8:45AM ET.
The U.S. Dept. of Commerce, Bureau of Economic Analysis (BEA.gov) releases its advance estimates report on GDP growth in the 1st quarter of 2010. Final results for the 4^th quarter of 2009 from the BEA came in at 5.6%. What will the advance #s for the 1^st quarter of 2010 hold?

James Cameron keynote. Las Vegas, NV
Sunday, May 16th, 2010
Academy Award winning director James Cameron keynotes the CA World 2010, education, training and networking conference on IT for all of your IT team members.

Agape Revelation Conference, LA, CA
Thursday, May 20-22, 2010
Reverend Michael Bernard Beckwith and Dr. Rickie Byars Beckwith delight, empower, awaken, create and celebrate in this 3-day conference. Dance in the rhythm and celebrate unconditional love and transformation.

Natalie Pace at Borders (Town Square) in Las Vegas, NV
Saturday, June 19th, 2010
2:00 PM through 3:30PM
Natalie Pace will lead a fun, interactive, visioning game that asks (and answers) the question, "How would you live if you had all the money in the world." Come play with us!

http://www.borders.com/online/store/StoreDetailView_603

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NOTICE: NataliePace.com is NOT a stock brokerage service, and does not operate or act as one.