Contrarian Stock Market Investing News - Featuring Bargain Stocks » Money

Old-fashioned commodities; old-fashioned strength

Chris Mayer — Wed, 11 Nov 2009 12:26:51 +0000

Chris Mayer (Penny Sleuth):
“If you can tell me something else where the fundamentals are so attractive…I’d be happy to put my money there,” said Jim Rogers, the famed investor and self-made billionaire in a recent interview. “But I don’t know of any other place.”

What’s he talking about? Today, we take a look and invest right alongside his idea. And it should start to pay off with the arrival of the first swallows of spring in 2010. It’s also timely now — in this weak-kneed economy — because it has traditionally held up well even in when the economy is on the ropes. Even the Great Depression couldn’t put this thing down.

We start with simple truths. The world’s population has more than doubled since 1950 — from about 2.5 billion to 6.7 billion. By 2050, there will be more than 9 billion people on the planet. Almost all of this growth will come from undeveloped markets such as China and India. And they will all be doing one thing, for sure — eating.

Now, hang on. I know that is a banal insight by itself, but this story has layers like a tiramisu. The second layer is the mix of food eaten, which is important. These undeveloped economies are getting richer. Predictably, as people everywhere have done and continue to do when they have a little more money in their pockets, they change their diets. They spend more on food. The average Chinese spends 40 cents of every additional dollar earned on food. In India, it’s about 70 cents of every additional dollar. What do they buy?

Read the rest of the story at PennySleuth.com.

Caterpillar (CAT) is Having Some Issues

Charles Delvalle — Fri, 30 Jan 2009 17:00:12 +0000

As a little boy, I used to marvel at the bright yellow Caterpillar (NYSE:CAT) trucks in the middle of construction fields and think to myself “that’s freaking awesome!”.

Never once did I even consider that one day I would be writing to you about how Caterpillar shares are ready to plummet. Here, take a look…

If you’ve been following this section every day, than you’ve heard me mention support lines on numerous occasions. A support point is a price (or trend line, or moving average) point that a stock has a hard time going under.

If you notice, CAT formed a support point in October and November. CAT his $32.50 and rallied both times.

But this time the pattern didn’t hold up, which means CATs support line at $32.50 is now a resistance point. Now, CAT should have a hard time rising past $32.50.

If you like the sheer thrill of losing money in the stock market, then you could definitely short CAT right now and probably make a pretty penny.

If you’re a little more conservative, then you’ll wait a few weeks for CAT to rise back up to around $32.50 per share. If CAT fails to break above that price point, then it signals a confirmation of the resistance line… and CAT shares should fall afterwards.

Pain at the Pump: No End to Gas Price Hikes?

Contrarian Profits — Tue, 22 Apr 2008 10:17:40 +0000

Crude oil yesterday shot past $117 a barrel. Sky-high oil prices are now hitting Americans where it hurts: their wallets. The average price US drivers paid for gasoline has soared to a new high of $3.51 a gallon, rising a hefty 11.9 cents over the last week.

“The rise in the oil price has little to do with supply and demand, says Phil Flynn of Alaron Trading over at Casey Research,” and has everything to do with the value of the dollar … It really is all about the dollar right now and if the dollar shows any sign of strength, you’ll see a lot of money come out of oil very quickly.”