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| 19th November 2010 - Volume 8, Issue 11 |
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Introduction Dear The end of October saw investors closing out October with solid gains. With the Federal Reserve's next moves to spur growth being closely watched, along with expected Republican gains in midterm U.S. elections, the markets anticipated a busy start to November. The U.S. economy grew at a slightly faster pace in
the third quarter but not by enough to raise hopes that a persistently high
unemployment rate may start to decline. In its first estimate for the third quarter, the Commerce Department
said gross domestic product rose at a 2.0% annual rate between July and
September, faster than the 1.7% seen in the prior three months. In personal finance, mortgage rates may be as low as they'll get with the Mortgage Bankers Association suggesting a rise toward 5% by the end of next year. The group predicts rates on the 30-year fixed-rate mortgage will average 4.4% in the fourth quarter of 2010, increasing to a 4.7% average in the first quarter of 2011, and climbing to 5.1% by the end of next year. That's barring any shock announcement from the Fed during November. In company news, Ford Motor Co. reported a 69%
jump in third-quarter earnings at the end of last month, marking five straight
quarterly profits for the resurgent auto giant as it moves to reduce debt and
meet pension obligations. In addition, Ford also said it has launched a tender
offer for about $2.6 billion in convertible notes, offering a cash premium to
encourage holders to convert the debt into common stock. November saw market attention turn to the Irish as bond traders and the government in Dublin clashed over a proposed rescue of Ireland's public finances. As it became increasingly clear that a rescue would eventually be agreed, attention turned to Portugal and Spain, regarded by many as the next weak links in the euro zone chain and becoming increasingly ripe for a bailout. Back in the US, Federal Reserve launched a direct
attack on the slow pace of China's efforts to strengthen its currency, accusing
China of throwing a wrench into the global economic recovery by undervaluing
its currency. General Motors' shares rose a little less than 4% on their return to the stock market. Market consensus was that GM's performance is looking good for the company's future. In addition, Wal-Mart stores reported a 9% rise in profit thanks largely to stronger performance at its international stores that offset weakness in its U.S. outlets. The company also raised its full-year outlook and gave fourth-quarter guidance that exceeded analyst expectations. It's just a week until Black Friday gets
the holiday shopping season going. But consumers looking to get a head start on
their shopping are already finding deep discounts on a wide variety of
items. Staying with thoughts of the
holiday, Airlines, who until recently were gleefully expecting their best
Thanksgiving weekend in years, are now worrying about whether a growing
backlash over tighter airport security might spoil the holiday travel season
for them.
Anacott subscribers saw two positions be assigned this month, one covered call conservative, ADBE, for an annualized return of 55.78%, and one covered call aggressive, UN, for an annualized return of 29.52%. Just two other positions had November expirations and these expired worthless. Otherwise we are taking the opportunity to remove some of the dead wood from each portfolio to free up funds to invest in new positions heading into a (hopeful) Santa rally, heading up to Christmas. Have a calming week-end and a great Thanksgiving Holiday. Best Regards
 Graham J O'Connor - President Anacott Investments LLC |
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Market Summary The
DOW opened at 11,062.71 on 18 October 2010 and closed at 11,203.55 on
19 November 2010, an increase over the period of 1.3%. The Nasdaq Composite opened at 2,470.12 on 18 October 2010 and closed at 2,518.12 on 19 November 2010, an increase over the period of 1.9%. The S&P 500 opened at 1,176.83 on 18 October 2010 and closed at 1,199.73 on 19 November 2010, an increase over the period of 1.9%. |
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The Economic Month Ahead Tuesday 23 November 2010 08:30 AM GDP 10:00 AM Existing home sales Wednesday 24 November 2010 08:30 AM Personal income, Durable orders, Initial claims Thursday 25 November 2010 Markets Closed - Thanksgiving Tuesday 30 November 2010 10:00 AM Consumer confidence Wednesday 1 December 2010 08:30 AM Productivity and costs 10:00 AM ISM manufacturing index, Construction spending Thursday 2 December 2010 08:30 AM Jobless claims 10:00 AM Pending home sales index Friday 3 December 2010 08:30 AM Employment situation Thursday 9 December 2010 08:30 AM Jobless claims Friday 10 December 2010 08:30 AM International trade 09:55 AM Consumer sentiment 02:00 PM Treasury budget Tuesday 14 December 2010 08:30 AM Producer price index, Retail sales Wednesday 15 December 2010 08:30 AM Consumer price index 09:15 AM Industrial production 10:00 AM Housing market index Thursday 16 December 2010 08:30 AM Housing starts, Jobless claims |
Earnings22 NOV 2010: HPQ 23 NOV 2010: MDT 24 NOV 2010: None 25 NOV 2010: None 26 NOV 2010: None 29 NOV 2010: None 30 NOV 2010: None 01 DEC 2010: None 02 DEC 2010: CWTR 03 DEC 2010: None 06 DEC 2010: None 07 DEC 2010: None 08 DEC 2010: ODC 09 DEC 2010: None 10 DEC 2010: None 13 DEC 2010: None 14 DEC 2010: None 15 DEC 2010: None 16 DEC 2010: None 17 DEC 2010: None |
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Benchmark Portfolios These portfolios were set up on 1st January 2005 and are operated exactly the way our suscribers operate their accounts. The returns are shown NET of OptionsXpress commission rates. Each portfolio was set up with the following parameters: Equity LEAPs: $50k and up to 10 positions INDEX LEAPs: $50k and up to 4 positions Covered Calls - Conservative: $50k and up to 5 positions Covered Calls - Aggressive: $75k and up to 5 positions To view the Benchmark portfolio performance charts, please CLICK HERE
You will need Adobe Acrobat reader to view the charts, you can get a free copy by clicking HERE
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Current Open Positions Summary To view the monthly analysis sheet for all our services please CLICK HERE
You will need Adobe Acrobat reader to view the charts, you can get a free copy by clicking HERE
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Customer Emails I'm trading in US markets thru ETrade. Please write me whether u
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Tips & Reviews Result tracking services Anacott Investment is proud of its trading history, is confident in its selections and is happy to have any alert tracked, monitored and verified as we have nothing to hide. Consequently, our trade alerts are monitored and verified by several result tracking services. One we have recently joined is Resultracker.com. Some details about the services they offer and a link to their site are given below. "There are a countless number of trade advisory sites currently on the internet. Some are great services providing great returns, while others are complete scams and/or publish falsified performance results. Before finding out in a particular service is a scam or not, you may have to subscribe to them first, and then find out the hard way. Resultracker has eliminated all the guesswork when it comes to tracking these returns. If you are interested in a particular newsletter but are not confident of their published results, we're here to help. We verify all trades sent by these services and publish those results for out clients. Our clients can then compare the actual results with the site's published results and can make a better decision to subscribe to their services or not. Resultracker received trade alerts provided by numerous trade advisors in real time. These trades are tracked until they either expire or are closed out by the service. We then publish the trade details, dates they were opened/closed and returns for each trade in our member's area. If there are multiple trades from a service we average all trades for that given time period. If a newsletter provider refuses to have their results posted on our site we list their name with 'Refused to Participate' next to them. This notifies our clients that this service does not want their results verified for some reason. For as little as $15 per month clients have unlimited access to members area containing a complete list of the dozens of tracked trade advisors. Included in the list are authenticated trade details for all of their alerts.
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Curmudgeon's Comment Disclaimer: The Curmudgeon offers his opinions freely but cautions the reader that this is what they may be worth.
Is General Motors, after its splashy initial public offering, really on the way to "becoming a success story," as President Obama says? As usual with politics, it depends on ones definition of "success." Yes, last week's GM IPO did fetch $33 a share, somewhat better than what had been expected. But was it a success, really? And is the revived GM positioned to regain lost market share by pioneering a booming new industry for green cars? The answer to both questions is simple: no. Start with the IPO. American taxpayers ponied up $50 billion to bail out GM, in exchange for which we got a 61% share in the company. In the IPO, we cut our government holdings to 33%, netting an estimated $13.6 billion or so. A good deal? Check the math. The U.S. lost an estimated $9.4 billion on the deal. In fact, for taxpayers to be made whole, GM shares will have to trade at about $53 a share. Not what Curmudgeon would call "success," at least for taxpayers. Moreover, GM operates under a virtual guarantee that it will be bailed out should it ever again go bust. So why wouldn't its IPO be a "success"? Many would buy stock in a company if they knew it had a government guarantee for its mistakes, as GM's IPO shows. Thus, a booming market in failure driven by tax dollars! Where has that happened before? Oh yes, in housing. And we all know how well THAT turned out. Worse than this is the false claim GM made earlier, that it had paid back its bailout "in full, with interest, five years ahead of the original schedule." As Reason's Nick Gillespie pointed out, GM just "repaid" its loan with other taxpayer-provided bailout funds. It was yet another useful lie, a fraud, all intended to show GM on the mend, thanks to the help of our federal government. But it goes beyond even that. Even after the IPO our government still owns a third of GM's shares. So if the stock price goes down, taxpayers will lose even more money. And more pernicious is that, with its hefty share of GM stock, the government will still call the shots. You can bet the feds will continue pressuring GM to make so-called green cars -- like the Chevy Volt -- that are supposedly less polluting than other automobiles. But as has been noted many times, GM's flagship electric car, the Chevy Volt, is really a lemon with an extension cord. Start with the price. It's $41,000 on the windshield. But it will be offered to buyers for less than that, thanks to a massive $7,500-per-car subsidy that the taxpayers will put up. Will anyone but the most politically correct shoppers opt for the Volt? Not at all likely. Not only is the Volt expensive, it is highly impractical. Company and government claims that it gets 230 miles a gallon in city driving are utterly false. Reports from both Motor Trend and Popular Mechanics found that it gets less than 50 miles to a gallon of gas -- and at times, as few as 26. The Obama White House wants GM to be the taxpayer-funded spearhead for a massive fleet of "plug-in" electric vehicles. Will this cut CO2 emissions to zero? Of course not. Will it cut emissions at all, even a little bit? Probably not. The reason: All electricity comes from -- wait for it -- electrical power plants. Our current grid is 70% supplied by coal and/or oil. And no matter what green propagandists say, that won't be changing anytime soon. "Today, more than half of the electricity generated in the United States comes from coal," the U.S. Department of Energy says on its Web site. "For the foreseeable future, coal will continue to be the dominant fuel used for electric power production." And this is generally true the world over, including China and India. In short, there is no green future based on plug-in cars. Only losses for the indoctrinated suckers who buy them -- and for the taxpayers who are fleeced to subsidize such economic folly. General Motors isn't a success. Nor will it be until the government is no longer involved in its business and it can stand on its own two feet without taxpayer help. Shame! |
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