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Fellow Investor, I hope you enjoyed hearing from ETF Master Portfolio's Rick Pendergraft yesterday. One thing I particularly enjoy about working with Rick is that he is a ruthless opportunist when it comes to investing. Wide-eyed enthusiasm won't get you far in investing. As a money manager, Rick has an obligation to find the profit opportunity in any situation. And his clients and ETF Master Portfolio subscribers can attest he does a great job. *****As you probably know, Greece is voting (again) whether to adopt austerity measures to lower spending and secure the next round of bailout loans this morning. And the stock market is expecting a positive outcome. It's still amazing to me that Greek citizens are rioting in protest of austerity measures. Yes, it's easy to understand that nobody wants to see their incomes cut, but the alternatives for Greece are far worse. Without austerity measures, Greece will grind to a halt, as it cannot access the credit markets. That leads to rampant unemployment. It seems obvious that some short-term pain is the better way to go. In fact, it's the only way to go. *****The rally over the last few days has been led by financial and energy stocks. Oil prices never made it to my hoped-for target of the mid-$80s, but oil stocks have certainly rebounded strongly. As I said when the IEA announced that it was releasing 60 million barrels of oil from global reserves, you can only manipulate a market for short period of time. Market forces will always win out in the end. *****The rally for financials is getting a renewed push this morning as Bank of America (NYSE:BAC) has announced it has settled some bad mortgage claims for $8.5 billion. While the settlement amount will push the banks' quarterly results deep into the red, it removes much of the uncertainty hanging over the bank. More uncertainty will be removed later today, when the Fed votes on new interchange fee rules. Interchange fees are the money banks receive from retailers who allow customers to use bank cards. The current level averages $0.44 per swipe. The Fed proposed cutting that fee to as low as $0.12. That's clearly a big hit to bank revenues. But the scuttlebutt is that the Fed will compromise and set the interchange fee somewhere around $0.20. If it's more, banks will rally. If it's less, expect a sell-off. Ultimately, it's hard to consider the "too big to fail" banks as anything more than a trade. The long-term prospects for Bank of America and Citigroup (NYSE:C) just don't look that great. | Special opportunity, article continues below.
| $14 Trillion in Debt and a 9% Unemployment Rate
It doesn't look good for the U.S. right now. We have a lot of work to do to get this country back on track. It could take 5 years...10 years...maybe more...
And I don't know many investors who can wait 10 years for their U.S. investments to get back on the winning path. I know I can't. And that's why I've created the U.S. Debt Protection Fund.
I'm Ian Wyatt of Wyatt Investment Research. My simple and easy to implement U.S. Debt Protection Fund will quickly and effectively protect your wealth as the dollar loses more and more of its value.
Click here to find out how to get your complimentary copy of the U.S. Debt Protection Fund special report... |
| *****Speaking of banks, what's wrong with Goldman Sachs (NYSE:GS)? The stock has been in a steady downtrend since early April. Shares now trade at $130 and the forward P/E is listed at 7. I suggested GS shares looked attractive around $135. Wrong. It would seem Goldman shares are weak due to regulatory uncertainty. How strong will earnings be once new rules on proprietary trading are implemented? I suspect we will also hear that the SEC has been investigating Goldman for unethical conduct related to mortgage backed securities. Goldman has a history of not disclosing SEC investigations promptly, so we are left to infer from the trading action. *****As I noted, financials and oil have rebounded. Jason Cimpl of TradeMaster Daily Stock Alerts is positioning for a rebound for precious metal stocks right now. In fact, he just released a new Special Investment Report called Top 5 Gold and Silver Trades for Summer 2011. And he's got a $3 silver stock in there that could move as high as $5, for a 63% gain. Jason is rarely wrong about such things. He's gauged every important market turn over the last 2 years, as well as important turning points for the U.S. dollar, natural gas, precious metals, and Treasury bonds. Jason's analysis alone is worth a pretty penny (I rely on it heavily). Throw in his consistently profitable trading recommendations, and you've got one of the best advisory services I've ever encountered. To top it off, I'm offering a special 4th of July 50% OFF sale only for TradeMaster Daily Stock Alerts. You can get the details HERE.
*****As always, feel free to write me anytime at ianwyatt@wyattresearch.com
Until tomorrow,
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