Saturday, January 28, 2012

State of the Union Pitches an Economy "Built to Last"


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A Shocking Story About the Coming Presidential Elections

A prominent financial journalist says that a single event - which is likely to take place in the next year - could soon transform America, overnight.

He says this event could also destroy Obama's hopes of getting reelected.

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January 25, 2012
Restoring the Dream: State of the Union Pitches an Economy "Built to Last"

By Martin Hutchinson, Global Investing Strategist 

In a speech before the nation last night, President Obama's State of the Union Address spoke of a new American economy that is "built to last."

Of course, in the wake of the dot com bubble, the subprime mortgage fiasco and the funny money of the last decade, that's certainly an objective all of us can heartily agree with.

The American Dream is in need of repair.

The good news is that with one exception the President's State of the Union Address did outlined some useful steps that could be taken to help boost the economic recovery.

Naturally though, I think the details could use a little tweaking!

The Worthy Goals in the State of the Union Address

To start off with, the President outlined his primary strategy to help bring manufacturing jobs back to the United States. That's an entirely worthy objective.

What's more, this goal actually has a decent chance of being met--- at least partially.

Here's why...

Chinese manufacturing costs have been rising rapidly over last few years, since its workforce is now demanding a larger share of the profits in the country's new found prosperity.

Also the President was correct when he claimed that there are several intrinsic advantages to manufacturing here in the states. As a result, the cost equation has been swinging pretty rapidly in favor of bringing manufacturing jobs back home.

His example of the Master Lock plant in Milwaukee running at full capacity for the first time in fifteen years is just part of a greater trend.

The President's proposal to lower corporate tax rates, while eliminating the loopholes that allow companies like General Electric to pay almost no U.S. taxes, will also undoubtedly help to bring even more manufacturing jobs back home.

Not only is this sensible, the President's proposal is politically clever as well.

After all, it's always pretty smart to call for something already starting to happen. That way your success is almost guaranteed!

Unfortunately, some of the President's other ideas were less satisfying...

To continue reading, please click here...
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Options Strategy: How a Home Depot (NYSE: HD) Straddle Could Provide Investors Lower Costs, Higher Returns 


By Larry D. Spears, Contributing Writer 

After more than two years of false starts, the battered U.S. housing market may have finally found a bottom.

If so, that prospect offers options investors a chance to earn higher returns on lower costs using a Home Depot (NYSE: HD) straddle.(More on that later...)

In fact, here are just a few of the latest statistics that lead me to believe housing will slowly begin to recover over the next four months...

  • Sales of existing U.S. homes rose by 5% in December to a seasonally adjusted rate of 4.61 million.
  • Rates for all types of mortgage loans hit record lows this month, with the benchmark 30-year fixed mortgage being offered at 3.88% last week.
  • Both housing starts and applications for new residential building permits rose steadily throughout 2011, hitting respective seasonally adjusted annual rates of 657,000 and 679,000 in December, both up more than 250,000 from 2009 lows.
  • And finally, last Wednesday, members of the National Association of Home Builders (NAHB) expressed their highest level of confidence in the housing market since June 2007 - the fourth consecutive month that sentiment levels have risen.
So, given the increasingly positive outlook for the housing market, the real question becomes: How can investors use this opportunity to their advantage in the first half of 2012?...

The answer is an options strategy that offers lower risk and potentially higher rewards.

How to the Play the Housing Market Bottom

Now typically, stocks that rise or fall with the tides of the housing market fall into three categories:

To continue reading, please click here...

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As of last Friday morning, all our picks were up - the biggest gainer 30.5% higher than when we released our 2012 report on Dec. 29.

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Luckily, it's not too late to get ahead of Wall Street and jump on these stocks, which were already made available to our Private Briefing service subscribers.

Just click here to gain access to the stock picks and accompanying analysis, as well as all the Private Briefingsubscriber privileges.

Four Natural Gas Companies Investors Can Buy Right Now

By Jason Simpkins, Managing Editor

Natural gas companies are hurting - there's no doubt about it. But that doesn't mean natural gas companies are bad investments.

In fact, some of these companies are currently on the bargain rack. You just have to know where to look.

Take EOG Resources Inc. (NYSE: EOG), for instance.

Traditionally known as a natural gas producer, EOG has reinvented itself as a major oil producer.

It's still heavily involved in the natural gas market, but the company also has managed to increase its total liquid oil production by 49% to 130,000 barrels per day.

Chief Executive Officer Mark G. Papa said he expects to reach 200,000 barrels per day this year. That would make EOG the second- or third-largest oil producer in the United States.

The effects of this transformation are evident in the company's earnings.

After taking a third-quarter loss of $70.9 million in 2010, EOG reported net income of $541 million for the third quarter of 2011.

That's not all. EOG's potential for growth is outstanding, since it has huge oil shale reserves. The company is the largest oil producer in both North Dakota's Bakken Shale and the Eagle Ford Shale in South Texas.

These two shale oil fields have played a key role in ramping up U.S. oil production over the past few years. They each have an estimated 4 billion barrels of recoverable reserves.

Earlier this month, analysts from Goldman Sachs Group Inc. (NYSE: GS) raised their EOG share price target to $118, while RBC Capital Markets (NYSE: RY) analysts set their target at $119. Those targets estimates represent a 13% to 14% premium from yesterday's (Tuesday's) closing price of $104.55.

And that's just one natural gas company with a strong investment pedigree.

Here are three others...

To continue reading, please click here...

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The "Oil Constriction" Is Imminent Now 

The U.S. is about to be blindsided by a supply-driven oil shortage. Big Oil's go-to energy consultant, Dr. Kent Moors, believes prices are set to outright double - with hardly any notice. To be sure, this "Oil Constriction" is imminent.Watch this presentation now to learn about your chance to make a ton of money from the impending spike in crude.
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KEY ECONOMIC REPORTS THIS WEEK

Release Date
1/23
No reports scheduled
1/24
Richmond Fed index (1/12)
1/25
FHFA home prices (11/11); Pending home sales (12/11); FOMC announcement; Fed Chairman Ben Bernanke press conference
1/26
Weekly jobless claims; Durable goods orders(12/11); Chicago Fed national activity index (12/11); Leading indicators (12/11); New home sales (12/11); Kansas City Fed index (1/12)
1/27
GDP (4Q); Consumer sentiment (1/12)

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