stock advisors

Why Stock Prices Will Continue to Fall

By Wednesday, October 15, 2014

Stock Prices Will Continue to FallNow that the Dow Jones Industrial Average has fallen 1,035 points (six percent) from its mid-September peak, the question investors are asking is “how far will she go?” For small-cap investors, the drama is greater, as the Russell 2000 Index has fallen 12.5% from its July peak.

Since 2009, every market pullback presented investors with an opportunity to get back into stocks at discounted prices. Even some editors here at … Read More

Stock Market Overvalued by 55%?

By Wednesday, May 21, 2014

Why It Feels Like 2007 All Over AgainOne of the oldest and most reliable ways to assess the value of the stock market is to look at its price-to-earnings (P/E) multiple. This multiple measures how much investors are willing to pay for each dollar of earnings. P/E multiples of 15 mean investors are willing to pay $15.00 for every one dollar of earnings.

When we look at the Shiller P/E multiple, it’s yelling, “The stock market is … Read More

Stock Margin Debt Reaches Record-High, Surpassing 2007 Pre-Crash Level

By Thursday, March 13, 2014

Proof Stocks Are Near Their TopAs key stock indices like the S&P 500 make new highs, bullishness increases almost daily, and stock advisors are saying buy more.

I am not surprised by this. All of these irrationalities tell us something very important: the bear is doing a great job of luring investors back into stocks as it gets ready to take their money away once again.

Dear reader, heed the warning signs of a market … Read More

If You Think Our Stock Market Is Overpriced, Wait Until You See This

By Friday, March 7, 2014

Why We Are Reaching a Stock Market TopThe stock market in France has been on a tear! Below, I present a chart of the French CAC 40 Index, the main stock market index in France.

Looking at the chart, we see the French stock market is trading at a five-year high. With such a strong stock market, one would expect France, the second-largest economy in the eurozone, to be doing well. But it’s the exact opposite!

As … Read More

Bad Weather to Blame for Consumer Spending Pullback? Numbers Argue Otherwise

By Thursday, February 27, 2014

Retail Sales All Slowing at the Same TimeMainstream stock advisors are blowing air…telling us the U.S. economy is stalling due to cold weather. They say the economic chill caused by the uncharacteristically cold weather this year is only temporary. I don’t believe this for a moment.

Sure, the weather had its impact. Consumers have been reluctant to go out and shop, and higher home heating bills might have them spending otherwise so far in 2014, but there’s … Read More

Amazon vs. Goldcorp: The Stock I Would Buy

By Friday, July 26, 2013

Amazon vs. GoldcorpCarlo and I went to high school together about 30 years ago. We remained friends after we left school even though we went our separate ways. Our common thread is that we are both entrepreneurs running our own businesses. After years of not seeing each other, last night we spent a couple of hours together discussing the economy and investing.

Carlo’s complaint last night, which is characteristic of many investors … Read More

The Truth Behind Second-Quarter 2013 Corporate Earnings

By Friday, July 26, 2013

The second-quarter earnings reporting season is underway, and mainstream stock advisors have high hopes. But what we are seeing is “more of the same” of what we saw in last quarter’s S&P 500 company corporate earnings: revenues are lower; corporate earnings are mediocre, and share buyback programs are boosting per-share income.

Take E. I. du Pont de Nemours and Company (NYSE/DD), a constituent of both the S&P 500 and the … Read More

Why Gold Bears Will Soon Find out They Are Wrong

By Monday, June 17, 2013

There has been increased volatility in gold bullion prices as investors run from precious metals. According to data compiled by Bloomberg, gold bullion’s 60-day historical volatility reached 28.9% on June 13. This was the highest level since December of 2011. Average volatility over the past five years for gold bullion prices has been around 20%. (Source: Bloomberg, June 14, 2013.)

As the volatility continues in gold bullion prices, the fundamentals … Read More

Truth Behind 1Q 2013 Earnings and What’s Next for Stocks

By Monday, June 17, 2013

Corporate Earnings GrowthThis shouldn’t be a surprise to the readers of Profit Confidential.

According to an analysis done last week by the Wall Street Journal, in the first quarter of 2013, corporate earnings growth of companies in the key stock indices like the S&P 500 wasn’t really due to companies doing better. Rather, “research tax breaks” are what pushed 1Q13 earnings up for many S&P 500 companies. (Source: Wall Street JournalRead More

Housing Recovery Already Comes to an End?

By Thursday, June 13, 2013

Rising Mortgage RatesThe housing market simply isn’t improving at the rate many in the mainstream media are telling us.

Home prices are still significantly lower than what they were during 2005 and 2006. On its own, there is no housing market recovery. All we are witnessing is the mere reflection of easy money provided by our central bank.

As I often write, to see a real recovery in the housing market, we … Read More