More and more confusion mounting everyday - here is the stuff that we hear
- Buy bad mortgages
-Buy bad loans from banks
-Buy commercial ppaper ( lend directly to business)
- Buy stocks
I dont think anyone knows for sure how the money will be used. The stock market eflects this in a lack ofconfidence - index keeps going lower
Here are some basic rules - a great video on YouTube - check it out here:
Why a credit crisis? Banks made bad loans - instalments are in deafult. The bank has to write off the loan. The loans that a bank provides is directly related to the investments and owned funds they have. When they have losses these funds reduce and the credit they can offer others are less. This will lead to a crisis in credit as well as liquidity.
But the roots of the problem stems from greed. When property prices were going up, even if a guy did not a $20 bill , could buy a house on a 100% interest - only loan. Overall, I guess better sense should prevail.
I think Coca-Cola (symbol KO) is now available at a discount. The share’s high during this year was 68, low was 49, it is now trading around 51.
Stock investing, shares investing, great returns, stock market
Yahoo news reports that the economic downturn has started changing consumer behavior patterns. Some of the very obvious changes are fueled by rising gas prices and job losses. Rising fuel prices are causing people to drive less, concept of “staycations” are gaining ground. The job losses will lead to lower overall spending. So, which are the companies that will benefit from this trend and which are the ones that will lose? The big three automotive companies have lost ground year after year. They will have to retool their gas guzzlers vehicles to small cars. Airline companies are losing billions. Credit card companies may post losses due to defaults on payments. Banks have been on a roller coaster for several months now.There are two companies that I think will continue to do well. Wal Mart, yes the retail giant, will see higher sales and profit. When the economy is in a downturn people conserve cash and look for value for money and not brand nmes. Pharma companies will do well. Johnson and Johnson is a company that I admire. They are doing very well. Coca cola is another consumer giant that will do well. They have been reporting results of 20% on their net worth. The price is low now, because the US sales are flat and they are contemplating a price increase. But their overseas sales have grown by 5% last year.
Watching trends and investing in business that you understand will provide great returns and safety.
Technorati Tags:
Stock investing, shares investing, great returns, stock market
Yahoo news reports that the President will lift the prohibition to off shore drilling, imposed by his father in 1990.There are two prohibitions to off shore drilling, one imposed by the Congress and the other through an executive order. This is one of the responses by the current White house to the surging gasoline prices. Let us see what kind of an impact this can have on gas prices.
Two announcements came in last week. Starbucks plans to close 100 stores. Wal Mart report highest sales month in last 4 years. This should be a classic investing lesson.
Stock investing, shares investing, great returns, stock market
Gas prices ae high. So what else is new? There are three things we can do. We can buy gas companies stocks , a great idea. We can travel less, not possible unless we stay close to work and can commute on a bicycle. The third option is to get a hybrid. Expensive and the cost benefit math does not work yet.
I recently came across a product that uses water, yes, am not kidding , in the combustion process. Costs approx $300 , you can recover the money in 2 days by saving $150 a month. Check it out. No harm in that. If it does not work, you can always return the product to the seller and get a full refund in 30 days - no questions asked.
Click Here! This product gives a power boost of 15% to 20%, reduces emissions, reduces noise, has a monthly operation cost of less than $1.
With a money back guarantee, you have nothin to lose.Click Here!
Technorati Tags:
Using water for gas, gas prices, low gas use, high mileage, cheap gas
Can this recession lead to a Depression like in the Twenties? In an interview, US treasury Secretary had this to say. In the Great depression there was a 25% unemployment rate, today the rate is 5%. In the great depression, the foreclosures were at 50%, today it is at 2% and 90% of the mortgage payments are on time.So it is highly doubtful whether the recession - no one calls it that anyway- might move to a full blown depression.
In an inteview published by Yahoo news the Secretary had this to say to the BBC .”Asked by the broadcaster whether the credit crunch or price rises were more of an issue, he said: “When you look around the world broadly, I think inflation … is getting the number one focus, when you look at emerging markets, whether its China, or Russia.”
Addressing inflation is the prime concern now. Look at it this way. Assume that you get returns of 5% on your investments. If inflation is at 5%, real returns are Zero. If there is no inflation , but let us say a 100% income tax, the real rate of return is still Zero.Inflation was fueled by low interest rates that reduced the value of the dollar. This lead to an oil price hike that lead to spiralling inflation.
The following weeks will tell us how the feds will contain inflation. Shold be interesting to watch.
Technorati Tags:
Stock investing, shares investing, great returns, stock market
Oil stocks have been reaching new highs. Here are 7 reasons why they are still a good buy
Always, consult your investment advisor before you invest in stocks
Technorati Tags:
Stock investing, shares investing, great returns, stock market
