I would advocate NOT.

In GOOD, times, yes maybe,,, bigger is better. In bad times, that would be debatable.
Yes, they TREND, to have a sustainable dividend, in many cases, BUT, they also have the slower growth. They tend to be SLUGISH.

Now, YOU will have to decide, your tolerance for RISK.Yes, safe may make you money,, today,,, or for fifteen minutes, depending on your time scale for investment. BUT, if you are a PRUDENT investor, you have to see the long term. Growth, is not likely to be there. In dividends, or stock appreciation. OK, I am with you. Historically, dividends do make up for stock price appreciation. In NORMAL times, I would agree with with you. Problem is, theses are not NORMAL times.

First rule of investment, is pick survivors. High or even close to high dividend stocks do offer HOPE. But, that is all they offer. For the LONG TERM investor, I would STILL, recommend a growth stock. Now, the definition of a GROWTH stock will vary. Some will make a growth stock as one with a dividend, less than one percent per year. WRONG.!!!. A growth stock,, is a stock, that BELIEVES, that it's stock price appreciation will EXCEED the current maket value for money. AND, can produce results, that will match that expectation.

So, as I watch the MEDIA, recommend, "Oh, be very afraid, and protect yourself, with dividend stocks", well, first, they are right. About 20% right. Yes, you do want dividends, especially in the TRYING economic times we have now. And, why do they recommend those? They may be the EASIEST, to find.

But, I submit to you, you can do FAR, FAR better, to pick some GROWTH stocks, if you are an INVESTOR. Now, let me define INVESTOR.

An INVESTOR, can, and will WAIT, They buy cheap, and sell high. ALMOST ALWAYS, it will be LATER. So, if you have a less than two to three year time frame, you will NEVER be an INVESTOR. Does that mean you can't make money?

Fotunately,, NO. But, it does mean, you can't keep it. Short term gains, are almost assuredly to be met with short term losses. Some of them will be BIG. No, I am not saying you can not get in, make a ton of money and get out. Some do. I will say, MOST do not.

The GAMBLERS, in the market, tend to be just that. GAMBLERS. And, if you know anything at all about GAMBLERS, they get rich quick, and lose it ALL, and more,, the next day,, or some day soon after.

Confessions of the soul here folks. As a REFORMED alcoholic, and GAMBLER (and one of the top 20 in the country),, that is NOT a LIFESYLE, for MOST of you. Yet AMAZINGLY ENOUGH, YOU all BELIEVE you CAN. Let me tell you FACTUALLY, most of you can't. And I have profited from that, and I am SORRY,,, sort of.

I can. I have been blessed. Then again, I have CHOSEN , not to. At least, not to any more.

NOW, I prefer to help people. And, the best ADVICE I CAN GIVE, is to INVEST,, in YOUR future.

God willing, you will have one!

Poor planning on your part, is a POOR excuse!

Making money,,, is SOOOOO very easy,,,,, and ALSO ,, so very HARD.

But, you can, without the personal sacrifes of a GAMBLER.

You need to invest, and do so with some RISK. That is the way to EXTREME riches. Then you need to understand,,,,,,,,, What you would do if you had that.

Most of you,, would not want it if if was DUMPED, in your lap.

Then again,, PART of it, would not be all bad.

Your PART, is easy enough to do.

INVEST,,,,, and BELIEVE,,, there will be, a tomorrow.

The rest, will take care of itself.

BUT, I do offer this advice. Be willing to WAIT.

Good things happen to those who WAIT.

I don't know why. It just happens that way.

And, when it comes to a stock market,,,,, that is ESPECIALLY true!!!!

Lose a little and shed a tear. Win, and it could change your life,,,,,,, for the REST OF YOUR LIFE.

After that,,, is up to YOU.

Comments: View Comments |  Wednesday December 31, 2008

I am not saying I have done everything RIGHT. Far from it. Then again, there is an abundance of PAIN going around, and I am not so very much below the AVERAGE JOE.

Yes, I built LARGE volumes of stocks doing well two years ago. They have taken a BEATING, but when money was good, they were LEADING the market.

So, this is what I am going to recommend, so we can get back into a LEADING mode. No, I am NOT going to recommend specific stocks for you, as some I have before, and I am finding a few new ones to test myself. Besides that, you need to do your OWN research.

What I am going to do is tell you HOW to do it.

First, do not sell your past winners at bottom prices we have now. You DO want to hold LARGE positions in them, no matter how much you may have lost so far. You MAY have to trim a few,,,, SLIGHTLY. Less than 20% of your total investment in them. Whether you have to sell to do the other recommendations or not, will depend largely on your available CASH.

Secondly, I want to remind people of TWO VERY IMPORTANT ITEMS. The first, of these is you came in naked, and you will go out not much better. No matter how much you accummulate in life, it will do you no good at all when you are dead,,, and sooner,, or later,, you will be. Yes, it is an UGLY FACT. You will die. Rich or poor, will not matter to the Grim Reaper. I could quote some biblicals that state it is harder for a rich man to get to heaven than for a camel to get through the eye of a needle, but like much of biblical, it is open to speculation, and interpretation. BUT, the second part of this is there IS LIKELY TO BE A TOMMORROW,, AND, DAYS, AND YEARS AFTERWARDS, for most of us. So, to fail to plan for that, would be short sided, at best.

But, young or old, does not matter here for the rest of you, who do want to find some financial security. Yes, if you are older, you have hopefully done the FIRST step. Find, some GOOD companies, and stick with them. Build in the GOOD times, and trim in the BAD ones. But, definitely, KEEP a LARGE share in them.

Then there are two other strategies not to be ignored, especially in these times. And, these are the best times for investments in these, in the last 50 years or more.

One, invest in high dividend stocks. Anything with a dividend over 5% right now is a candidate. Avoid anything with a dividend of over 40%, unless you can handle the risk associated with it.
Yes, some with dividends that high, ARE indeed good investments, but the chances that dividend is sustainable is slim. Still, they will be the dividend stocks of the FUTURE, and there will be one,,,, if they survive. They will. I would bet dollars to donuts on it.

Secondly, this is the world's WORST time to FEAR penny stocks. Actually, this is the BEST time for it. Do this with great care, and pick a BASKET of them, 5 to 10 MINIMUM, and 20 is not out of the question. Count on it, you WILL have LOSERS. But, if I am CLOSE to right, you will lose EVERYTHING on TWO, and gain 800% on the bulk of it,,, in TIME. YES, you do have to WAIT. Two to three years, minimum.

Bear markets do some good for all. It makes some things cheaper. It also shows that you are OVER-INVESTED, in some stocks, or sectors.

In general, there is ONE undying law in stocks.

MORE SHARES,,, is ALWAYS,,, better.

You may have to pull back, to build more shares later. And, there is NOTHING, to replace diversity.

The market will be VOLITILE. Count on it,,, in ALL sectors.

Personally, I would avoid financials, housing, and retail, but that is just me. You may find a GOLD MINE, in them. But, if I was YOU,,,, with all the investment the government has been making in defunt companies, a GOLD MINE, might just be the ideal investment.

I said I would NOT recommend stocks, but to follow this thought, (or lack thereorf), check out AUY,GG, or KGC. They are some premiere gold miners.

My PERSONAL best pick, remains, BHP. It is not the best market performer, but it is a LONG term WINNER. But, as a SPECULATOR, I like SHIPPING, especially, dry bulk carriers. Why? It is just too cheap, and entry barriers, are just too high. My pick, is TBSI. No dividend,, yet. Enough ships already, that is just a matter of time. EXCELLENT management. Yes, it is RISKY!

But, temper your portfoluio, with dividends, small caps, and YES, some risks. But, do keep large amounts of those that are sure to do well over the long term, and that may mean some bigger companies.

You, and I will come out of this ON TOP.

I GUARANTEE it.

If I live long enough,,,,,, and I intend to. The market guarantees nothing, and neither does or did God, (depending on your belief). Personally, I believe this. BOTH, will try your patience, and NEITHER, will give you more than you can endure. I have FAITH in one, and HOPE for the other.

Bless you, and yours. It will NOT be easy. We have that promise,,, from BOTH!

Comments: View Comments |  Friday December 26, 2008

Abraxas petroleum may be offering it. Symbol AXAS on the stock exchange.

Ok, a natural gas producer, and driller, and the sector is getting SLAUGHTERED right now.

That can be a good thing for YOU!

I bet I looked at about 100 stocks tonight, and it was one of a few, a very few, selling at below book value. How much below? The stock sold for $.73 a share today. It's book value on a share is $1.20. So, the share price is well below the value of the company assets. And, better yet, it's 2009 earnings estimate is a 140% gain, against an industry projected to drop by 13%.

Now, if it goes broke, you will not see ANY of that value that is the difference between share price and book value, as an investor in common stock. Then again, chances it will go broke are pretty slim. It is a split out subsidiary, so it does not have the most profitable history. But, it has a very low debt, and it is projected for double digit production growth in 2009.

By my calculation, if you buy it today, with plans to hold it at least two years, you pay $.73 for a stock with asset value of $1.20. You make $.50 a share the day you buy it. It has had share prices over $4.00 within the past year, so the potential for stock price gain is great. It could easily be an aquisition target, and that could make a 50% stock price appreciation much sooner than the two year hold period I minimally recommend here.

This is NO GUARANTEE, but it has all the signals to be free money. Ordinarily, I would be VERY skeptical to recommend ANY penny stock. It has become one, but is struggling hard not to be one in the future.

Use your own judgement. Other stocks will offer more earnings per share, but they are also oversold compared to book value. Then again, GM, FORD, and some others, are under book value too. They will fail, with or without a bailout.

I have some faith here. Don't bet the farm, but several thousand shares would not hurt you,,,, if you can afford the risk. It does have RISK. It could have a reward, very soon!

Comments: View Comments |  Tuesday December 23, 2008

Experience and economics have taught me a few things. Like there are two tricks to money. Making it and keeping it. No, that is probably not an original, as I am pretty sure at the least, Warren Buffet beat me to saying it (he is older than I am, not to mention richer). But it is true.

This will deal with recommendations for mostly the younger investors, and it is dealing with the economic conditions we have today. A lot will apply to ALL investors however.

First, young is the ideal time to begin to invest. It is also the hardest to do then, as many start out with nothing, and need everything. And they lack experience, and the information overload just can't be properly processed.

But, let's for a second assume you are a young college graduate, or even younger and without a degree. And, let's say you are one of the lucky few in these times, and you have a job.

Most employers will encourage some form of long term savings plans, and encourage enrollment, as they should. You do need to set up a savings plan,,, no joke folks. Then again, I do know just how hard that is to do on a shoestring budget. Trust me, 95% of you will waste more than $10 a month, and many of you more than $100 a month. It is a function of being younger, and yes, less disciplined. And, I do not mean that in a bad way. You are buying experiences. Unfortunately, it is all current, and there will be a future.

To keep this short, I do recommed you invest. Any way you can. Experience tells me, if someone else does it for you, you will miss it less. For that reason, and only that reason, I will recommend you invest in 401K to the maximum you can live on. Otherwise, a 401K is likely the WORST investment you could make. It is right up there with life insurance, in terms of a poor investment for the young. If you are going to live 50 more years, and most will, how much life insurance should the young have? They have nothing of value, except "life" anyway, and charging for that is riduculous.

So, what to do, and still invest. Force yourself to set up an INDIVIDUAL INVESTMENT ACCOUNT. Force yourself to set up a direct deposit to it. As much as you can live without, so you can live much, much better later. IT WILL WORK. By the way, Fidelity Investments, is a good company to do this with. There are others though.

Now, here is the good, bad, and the ugly with this idea. You have just erased the fund manager cost you will get that you will be charged from a 401K. You will be becoming your own fund manager. Why pay them 5% or more, for what you likely will do better at anyway. It does have problems however. Because you do not have a ton invested already, your trade costs will be relatively higher, so you want to make a limited NUMBER of trades. The rates go down later, when you have more invested, but initially, trade costs can add up. Then, you have the best opportunity in maybe 50 years to invest in good companies, at the cheapest time, so you have almost a guarantee, you will succeed over time.

There is no replacement for research, and you will have to do some. MSN MONEY is a GREAT site. Get used to it, and use it often,, (once you can afford a computer (lol)).

Then, find 5 stocks you think have promise, that cost less than $10 a share. Initially, you may only need one of these. If you invest $10 a month, invest in one a year with a minimium of 10 shares buys. If you invest $100 a month, invest in two for them at 20 shares each, each month, until you get you 5 stocks. Yes, you DO need DIVERSIFICATION, as soon as you POSSIBLY can afford to do it. Still, because you may not be able to diversify quickly, does not prevent you from making money on a single stock. Then again, not all of you will, unfortunately. The second thing you MUST have is patience. Something most young people lack too much of. But your investment here is not so huge, you can't withstand it. It will be tough, and I know it. You still see some red at some point on your investments, at least in a single stock. Until you can get some diversification, ride it out. Time WILL make you a winner! If it has not in 3 or more years, you may consider a sell, but ONLY to reinvest elsewhere.

Here is the beauty of this though. At the end of 5 or less years, you will have a portfolio, that YOU can manage. It may or may not be a big one, but chances are GOOD, you made money on it. And, it is far better than your bank. If you put it in your bank, you likely pulled it out, because it was just too convenient, and your needs were just too great. Fact is, you would have survived anyway, and this GIVES you something, because it is a little tougher to do.

Now, the bigger your investment amount, the bigger your returns will be. So, for you with more cash, I still recommend, some good stocks, at under $10 a share. Some of the best stocks may cost more than that, but the weaker stock price stocks DO have the best chance for a big bounce right now, as they have been beaten down already. It is not the time to fear penny stocks, but be extremely cautious with stocks under $5 a share, and limit your portfolio to 25% or less of them.

My point here is simple. Be your own INVESTMENT MANAGER. No chance someone else scams you. Second point, be patient. Too much activity, will cost you. Third point, there will be a tomorrow, next day, next week, next year, and for most of you, more than 3-5 decades. You can make ALL OF THEM better!

You don't NEED someone else. You need YOU! Everyone else wants your money, no matter how much or how little. Don't pay them. Pay YOU! For the long term!

Comments: View Comments |  Wednesday December 17, 2008

Before you go any further, be sure you have read my prevoius post, on "stock to invest in",, and I mean NOW.

These are stocks for the BRAVE, that are not likely to have much downside. But, in a volatile market, like we have now, they are risky at best. But, still, I would bet on them.

My thesis is here is much as before. They did something right before, and will again. They are just too good to count out.

Leading my list is,,

NE - a good sound oil driller. I like the management. Weak dividend, but the stock will appreciate, and if oil gets over $80 a barrel, this stock will soar. Not near as big as RIG in market share, but bigger is not always best. This is the best. DO (Diamond Offshore) will be hard to beat though.

POT - A truly scary stock. Nearly a monopoly on potash, especially in certain segments. How long can they hold agriculture down? Let me see you quit eating for six days in a row, and we can discuss it later. Not a necessity for agriculuture, but it increases productivity by a huge percent.

DE - again, and agriculture industry leader, this time in equipment. A good stock, well run by management. Beaten like a red-headed step-child lately. Can only be called a buy,,,, and hold.

MT - who but a fool would invest in steel right now. I would. The industry is just too abused. The concepts of buy end to end supliers will pay off in time. Management is no fool.

AXAS - Losing money lately, but still a good investment. Why? They maintain one of the lowest debt ratios anywhere. Give it time, and profits will overtake the debt margins. One of the very best acquisitions targets on the market today. You can't beat the price on this stock, at anywhere under a $1 a share.

If my stocks for the brave has not scared you off so far, my last two might,then I will give you one freebie (buy).

WDC - just too beaten up. The world need computers, and data storage. Not the biggest, maybe, the best, in a niche market. RISKY,,, highly RISKY. But, it will prevail.

WMT - wow, do I hate retail, as a market segment. But, Wal-Mart, is hard to deny. The middle class, and lower-class, will ALWAYS, outnumber the upper class. You simply have to put money on that. And, they are the best at what they do.

And for the freebie BUY.

IBM - yes big blue, will return, as a market leader despite stuck up management, and snobby employees. I have never seen a company so much in need of an overhaul, but the technology lead they have, well, it can't be caught. In an information devouring world, as we have today, BIG cannot be ignored. I fully expect, IBM to buy out GOOGLE. Yes, dinosaurs eat each other.
And, it is hard to beat an old dinosaur that has learned to fight. Especially, if it is big, and has an edge. It would be bloody. Even without the fight over dinner, IBM is a buy. Too hungry. Too lean. And not all together bright. The making of a serious fight. Then again, T-rex died too.
Would you bet against one, if you saw it today?

Comments: View Comments |  Monday December 15, 2008  |  Stocks: AXAS, DE, IBM, MT, NE, POT, WDC, WMT,

My posts are not always the most positive, as you may have already witnessed. Then again, there has not been too much to be positive about lately, at least in a good sense. There has been plenty too much to be negative about though. But, today, I am going to mention a few, and just a few stocks to invest in, yes NOW, and tell you why for each. I will give some specifics, but, not all, as it would take too much space.

TBSI - yes, this may well be my favorite. It has no dividend (boo hiss), but not more than three years ago I bought this stock at near it's current price, and watched it grow 800% in a year. I can't promise that, and it did drop back in price as the market crashed, but I would bet dollars to donuts you will see a 400% increase within 4 years. That ain't too bad. It does have a moderately high debt level, which is scary, but not insurmountable.

GNK - another shipping stock with promise, and a dividend. It too has been abused in the market crash, but not too long ago, it was $80+ a share. It will be again. Again, somewhat high debt, but the returns will be there. Buy and wait it out.

DO - the best positioned oil driller, with the best dividend in the industry. AT 69$ a share, this is one CHEAP stock!

TNH - probably the best dividend stock anywhere around. It offers stock appreciation too. I have touted this stock many times before. If you have not bought before now, telling you more will not make you a buyer here. I have no problem with that either, but I like to watch my money grow, and maybe yours too. This is a good place for it. Good industry, good stock, good dividend, and little downside. Debt issues slightly possible, but less than most.

BHP - the king of diversification in a small kingdom, if you consider raw materials a small kingdom. Then again, if you consider that as the kingdom, then they they are the one eyed giant in the land of the blind. The raw materials market cannot go away, without every other going before it. Iron ore, gold, silver, molybnium, diamonds, and more. This stock will double, within 3 years.

STO - be patient here. The 4% dividend will not kill you, albeit, it is paid only annually, around August. The stock price will double too, and I put about a three year time frame on that. It has before, and I have no reason to believe it will not again. The time frame to double is a little tough with the volitile oil prices these days, but, well, I have faith. Demand for oil will not go away.

Some still downtrodden stocks I have faith in, but have perfomed too poorly to mention here (recently).
FCX, MTW, DSX, SNHY, NOV,JOYG, and SII

At heart, I am a bull, maybe in a china shop, and that can be dangerous. My portfolio once led the way to the top, and I think I can get it out of the cellar. A lot of us fell on the way down.

I led on the way up, and I will again. Lead on the way up, that is. My portfolio has dropped too much to lead much of anything. Then again, I followed rules and stayed invested (maybe too much?)

If the past is any indication of the future, and it usually is, I would not waste a minute investing in the stocks I just mentioned. No matter what the rest of the market does, you will have invested in SURVIVORS, and the dividends won't hurt you, and you should enjoy the stock price appreciation, if you can wait for it.

Comments: View Comments |  Monday December 15, 2008  |  Stocks: BHP, DO, DSX, FCX, GNK, JOYG, MTW, NOV, SII, SNHY, STO, TBSI, TNH,

We all know who should have been going bankrupt. Lehman, AIG, Bear Stearns, Citi, GM and some more. Those are a pretty elite group. But. let me add one more here, that is now not to be outdone. The US GOVERNMENT!

This blundering group of idiots (congress) now has us on the hook for a 6+ TRILLION (yes with a "T") dollar bailout. In the name of what? Well, let me tell you. It is not the taxpayers, like you and me. In the end, that debt has to be repayed, and it will be the taxpayers that do it. In the mean time, the governement just prints more money, and says we are keeping people in jobs?

Horse pucky!

Yes, the government has been extending some unemplyment benefits, and that is a government function. It is one of a very few things they have gotten right so far. That is about the limit of what the government stimulus packages should be. Providing jobs, job training, and employment and social (medical and social security) benefits the government should be doing.

This idea that they can save the world by bailing everyone out can only be a misearble failure.
First, it can not be implemented fairly. Bail one, then you should have to bail all. They have no intention to bail all. This idea of "too big to fail"? Who came up with this foul stinking theory? Something else from the south end of a northbound horse. And yes, we have the horses asses in congress doing all the dirty work.

Do they really think the world economy would fail? Do they think the US economy would fail?
The answer to both of those question is an undeniable NO! What then is the fear? Is it housing that is the problem? No, but it is a symptom of the problem. It may have gone so far as to cause the problem.

Is it the investment houses? No, we have seen the run on stocks forcing stock prices to rock bottom, or very near it. But, I do still contend many of the funds are guilty of collusion, and should be abolished.

All of these are problems, no doubt. But, the government's big fear, is it's favorite son industry.
Banking to be quite specific. Why? Unlike stocks, which are a tangible assets, banks hold money, which has become an INTANGIBLE ASSET. The money the banks hold, is a fraction of the money people have allowed banks to manage. And, a run on banks, where everyone pulls money out at the same time, would not only bankrupt the bank, but probably the FDIC too. Now, the FDIC is the depositor insurance, and it is government backed. So, we have come full circle. Banks fail, and who is to collect from the loans they had outstanding? Creditors,, if they had a way to get it done. Yes, the original depositors, but only through the pitance the courts hands back as a result of the banks bankrupcy proceedings. Now you have seen what one simple bank bankrupcy can do, multiply that times ten thousand, or more. Yes, that is what the government is really on the hook for, and so afraid of.

None of us are so niave as to believe they really care about taxpayers. We know they don't. It is time to not be considered a taxpayer, and to be considered a human being.

Some of you would imply I am thinking only of the US, and this problem is global. It well may be a global problem. But, the problem got there without the assistance of the governments, and it could and should be cured in the same manner. Quite simply, let markets do what they do, and STOP INTERFERING!

Let bad companies fail like they are supposed to!

If the government needs that 6+ TRILLION to support the FDIC, then at least that is a real government function. The government does not need to be in the private sector AT ALL, beyond some MINIMAL government regulations! And, even that they botch. Like I said before, most hedge funds are nothing but collusion, and that is outlawed everywhere else.

We do not need more government, we need less of it. But, if this was a horse race to be run in a backwards fashion, I am pretty sure I know which horse's ass would finish first.

Comments: View Comments |  Monday December 1, 2008