And with some justification, for China and the two Asian “tigers” share some alluring characteristics like:

• A highly competitive and innovative manufacturing industry.
• Excellent government and workforce discipline.
• Modest fiscal and monetary stimulus (or, like China, they started from a position of budget surplus).
• And an export orientation that seems likely to benefit quickly as order is restored in the global trading economy.

But there’s another country that shares those characteristics. It’s nowhere near East Asia. But investors can expect this particular economy to also bounce back from this recession with considerable vigor.

I’m talking about the center of supposedly sclerotic Old Europe itself: Germany.

Germany lacks the huge financial sector that has been the bane of the United States and British economies, but it has manufacturing industry that is the envy of the world. Its balance of payments surplus was $205.8 billion in the 12 months through April, and is expected to be 4.4% of gross domestic product (GDP) for all of 2009.

The German government resisted the urge to splurge on “stimulus” packages, and consequently is expected to run a budget deficit of only 4.4% of GDP in 2009 – a ratio that’s far smaller than those of other “advanced” economies, and one that should be easy to finance. Furthermore, the European Central Bank (ECB) has been the most conservative of all major central banks outside Brazil, and German Chancellor Angela Merkel has indicated pretty strongly that it had better stay that way, as she is worried about inflation.

German labor discipline is world-famous, partly because of its sophisticated system of “mitbestimmung” (co-determination) between industry and labor unions. Thus, Germany loses only four days to strikes per 1,000 employees in an average year, an average that’s well below the same statistic for each of its European neighbors. Skill levels are also excellent, because of the superior German education system, much of which is run in partnership with industry.

Because of its more conservative fiscal stance – with less stimulus – Germany has suffered through a much-deeper recession than many other countries, with first-quarter GDP down 6.9% from the previous year.

By comparison, economic output declined 2.5% in the United States and 4.2% in Korea, but 8.8% in Japan and 10.2% in Taiwan.  However, manufacturing orders stabilized in April and it seems likely that Germany will experience a return to growth in the second half of 2009. The ZEW indicator of German economic sentiment for June came in at 44.8 – up more than 13 points from the previous month, and a three-year high. When Germany starts to recover, its economic rebound is likely to be healthy, without resurgent inflation or bond market turmoil, because of Germany’s cautious fiscal and monetary policies.

What to buy? Well, for a start there’s the German exchange-traded fund (ETF), the iShares MSCI Germany Index (NYSE:EWG). At $489 million, it’s surprisingly small, but it has a Price/Earnings (P/E) ratio of 12 and a yield of 6.4%, meaning it provides shareholders with a decent income. It also provides a much-broader exposure to the German market than do the American Depository Receipt (ADR) shares, which relate only to very large companies, and not to the highly successful “mittelstand” medium-sized enterprises.

There are eight German companies whose ADRs have a sponsored full listing on the New York Stock Exchange (several others have moved to the Pink Sheets recently because of the costs of Sarbanes-Oxley compliance). Of these, Infineon Technologies AG (OTC ADR: IFNNY), a semiconductor manufacturer, is making a loss, while Qimonda AG (OTC ADR: QMNDQ), a maker of computer memory devices, is in bankruptcy.
That leaves six possible profit plays:

• Allianz SE: (NYSE ADR: AZ): This huge insurance company sold its shares in Dresdner Bank AG and is now a shareholder in Commerzbank AG (OTC ADR: CRZBY). Allianz lost money in 2008 because of investment losses, but is trading on only nine times projected 2009 earnings, with a 5% dividend yield.

• Daimler AG (NYSE ADR: DAI): A major automaker, and producer of the upscale Mercedes Benz brand (including the fashionable “Smart” small car), Daimler is now thankfully devoid of Chrysler LLCinvolvement. Daimler gratuitously tossed away a considerable amount of shareholder value with two foolish diversifications – into aerospace in the 1980s and into Chrysler in the 1990s. If management can keep its eyes on the road (stay on the black stuff between the trees), this stock could be quite attractive. Daimler’s shares are trading at 20 times recession-year earnings. The dividend yield is only 1.7%, but overall there’s a lot of upside in an economic recovery.

• Deutsche Bank AG (NYSE ADR: DB): This is Germany’s premier bank and investment bank, but it is currently losing money and the stock yields only 1%. For a play on a German financial sector recovery, I prefer Allianz.

• Deutsche Telekom AG (NYSE ADR: DT): Germany’s traditional fixed-line telephone service, Deutsche Telekom also has mobile-phone operations and has increased its revenue by also offering high-speed Internet access. Currently operating at a loss, DT also cut its dividend. Avoid – there are better telecom plays out there.

• SAP AG (NYSE ADR: SAP):  A globally known provider of so-called “enterprise resource planning” (ERP) software, SAP shares have a dividend yield of only 1.2%, and are trading at 19 times prospective earnings. The stock looks a bit pricey to me: I like the sector, but not SAP’s bureaucracy-friendly product line.

• Siemens AG (NYSE ADR: SI): With its wide array of product offerings, Siemens is operationally akin to General Electric Co. (NYSE: GE). Indeed, with  heavy-equipment offerings that range from locomotives to electric power plants, Siemens is selling the kinds of products that are likely to benefit from heavy “stimulus” spending worldwide. The company has recovered from losses in 2006. But the shares are trading at only 11 times estimated earnings for the 12 months that end in September. That low valuation, coupled with a nice dividend yield of 2.9%, makes the stock appear fairly attractive.

Source: Germany: Emerging Market Profit Potential, With (Only) Developed Market Risk

• In its latest global outlook, the International Monetary Fund (IMF) slashed the growth forecast for every major country and urged more recovery actions. The IMF said the global economy will likely contract 1.3% this year and post a 1.9% gain next year, Reuters reported.

• Mercatto Estrategia FI, a Brazilian hedge fund that is beating 97% of its peers, is selling assets of the country’s largest homebuilders and banks, saying they are overvalued, Bloomberg reported. “Since we’ve lived through a liquidity crisis, it shook up the economy a lot and there have been huge declines in healthy names,” Regis Abreu, the head of equity at Mercatto, told Bloomberg.

• Prices of U.S. single-family houses rose a seasonally adjusted 0.7% in February, the Federal Housing Financing Agency (FHFA) said. The FHFA’s index is calculated by purchase prices of houses financed with mortgages sold or guaranteed by Fannie Mae (FNM) and Freddie Mac (FRE), Reuters reported.

• Home prices in Dubai could sink as much as 70% from their peak values late last year on sour demand and a halt in mortgage lending, UBS AG (UBS) said in a report. “We are still in relatively early stages of the property down-cycle in United Arab Emirates,” Saud Masud, a Dubai-based analyst at the Swiss bank, wrote in a report to clients, Bloomberg reported. “We believe risk-reward profiles are not yet compelling for investors to consider market re-entry, hence continued price declines are expected.”

• Apple Inc. (AAPL) reported second-quarter profit and sales that exceeded analysts’ estimates. Apple’s iPhones and new iPod models helped spur sales of $8.16 billion that yielded net income that amounted to $1.21 billion, or $1.33 a share, in the period which ended March 28 Apple said today in a statement. Analysts predicted profit of $1.08 a share and sales of $7.95 billion, according to a Bloomberg survey.

• Agents with the Pentagon’s Defense Criminal Investigative Service searched the Malvern, PA offices of a unit of Germany’s Siemens AG (ADR:SI) on Wednesday.  The search was part of an ongoing investigation, a Pentagon spokesman said.  Ed Bradley, special agent in charge, said the search began early on Wednesday and continued throughout the day, but he gave no details on the nature of the investigation, according to Reuters.
• David Kellermann, the acting Chief Financial Officer at Freddie Mac (FRE), was found dead early Wednesday in the basement of his home in a Washington suburb, police said. Early reports from sources in the police department indicated Kellermann’s wife reported a suicide. There were no signs of foul play, and the death is under investigation, Fairfax County, Virginia, Police Officer Shelley Broderick told Bloomberg. The medical examiner’s office said it’s conducting an autopsy.

• In a sign that efforts to overhaul its main auction and fixed-price retail site may be working, EBay Inc. (EBAY) reported sales and profit that beat analysts’ estimates, Bloomberg reported. The most-visited U.S. e-commerce site said net income was $357.1 million, or 28 cents a share, compared with $459.7 million, or 34 cents, a year earlier.  Excluding some items, earnings were 39 cents a share, beating the 34-cent estimate by analysts.

Source: Global Investment News Briefs Thursday April 23, 2009

Jason Simpkins of Money Morning says that “…some analysts estimate that India’s nuclear energy sector could be worth as much as $200 billion.”

Here he shows us what majors are lined up for the deal:

India launched its first nuclear test in 1974, but the country refused to sign the global Treaty on the Non-Proliferation of Nuclear Weapons (NPT). As a result, the 45-member Nuclear Suppliers Group (NSG) banned India from global nuclear trade.

That ban was lifted last September when Washington pushed through a “waiver” that freed India from 34 years of sanctions.

Critics of the deal worry that by lifting the trade restrictions on India, the world’s “responsible” nuclear powers are undermining the NPT and could potentially reignite an arms race with India’s rival Pakistan. But the deal’s supporters see the decision as an act of good faith towards India that will enhance global ties and help that nation meet its growing energy demand, perhaps through a more eco-friendly method than burning coal and oil.

As it now stands, about 69% of India’s electricity is generated from coal, according to the World Coal Institute. Demand is projected to soar from 391 Megatonnes (a metric ton, also referred to as “Mt”) in 2002 to 758 Mt in 2030 – a 94% jump.

In fact, only one country is expected to have greater demand for coal during that period – China.

Up to now, one problem has been that India only has 17 nuclear reactors, which produce just 2.5% of the country’s electricity.

“India does not have much of energy option,” V. Raghuraman, an energy advisor to the Confederation of Indian Industry, told the Voice of America. “We are short of hydrocarbons. We are short of coal. We are short of everything. We need an energy mix. We need to make the ground today to prepare for the future.”

India would like to boost its nuclear energy capacity from by 60,000 megawatts (Mw) over the next 15 years, according to Raghuraman. That would more than double the contribution that nuclear power is making to India’s electricity grid. For that to happen, however, India would need to add 40 new nuclear reactors at a cost of roughly $80 billion.

This nuclear “explosion” will generate billions of dollars of new business for the world’s leading energy companies, as India scrambles to secure fuel, acquire equipment, upgrade its technology, and develop and train workers to build, operate and maintain the power plants.

“Today, since there has been a technology denial and fuel denial for the last more than three decades, India has developed an in-house program and there have been some capabilities, but surely these are not world class or also of the capacities which are required for future development,” said Raghuraman. “Which would mean we really need to access technology. We would like to look at accessing technology from all around, because the kind of capacities which we need are phenomenal.”

Global Powers Swarm India’s $200 Billion “Mega-Opportunity”

Last month, an 18-member delegation from the United Kingdom, headed by Lord Peter Mandelson, the British secretary of state for business, enterprise and regulatory reform, arrived in Delhi with executives of companies such as Urenco Enrichment Co., Thompson Valves Ltd., and the Weir Power unit of The Weir Group PLC.

That delegation was accompanied by an additional group from Canada, whose members included representatives from Atomic Energy of Canada Ltd., Cameco Corp. (CCJ), and SNC-Lavalin. Canadian Minister of International Trade Stockwell Day led the delegation.

“Canadian companies are well positioned to capitalize on opportunities and to work with their Indian counterparts to meet the needs of India’s civilian nuclear market,” Minister Day told Knowledge@Wharton, the University of Pennsylvania’s business journal. “India is very enthusiastic about using Canadian technology and resources to help build [its] nuclear energy capacity.”

India also entertained similar delegations from France, Japan, Russia, and even Kazakhstan.

All of these groups were eclipsed by the U.S. delegation, represented by 60 senior executives of 30 nuclear power companies.  The U.S. group spoke with a host of Indian companies, including Tata Power Co. Ltd., Larsen & Toubro Ltd. (PINK: LTOUF) and Punj Lloyd Ltd.

The representatives were originally scheduled to arrive in December, but their visit was delayed by the terrorist attacks in Mumbai.

“The robust presence here of the U.S. commercial nuclear industry, so soon after the unfortunate events in Mumbai, speaks of the commitment of our companies to partner with India in the coming nuclear renaissance,” Ted Jones, director for policy advocacy at the U.S.-India Business Council (USIBC) told Wharton.

Exactly how much money is at stake for these delegations is unclear, but some analysts estimate that India’s nuclear energy sector could be worth as much as $200 billion.

“It is premature to provide specific numbers as details of the work involved cannot be discussed with any of the foreign companies pending clearances from their respective governments,” said Larsen & Toubro Senior Executive Vice President M.V. Kotwal.  “An approximate assessment of the business potential available for Indian industry could be on the order of $1.5 billion to $2 billion a year after a couple of years.”

Even more optimistic is an L&T white paper, which takes a broader view.

“The Indo-U.S. nuclear deal will open two-way cooperation between India and the U.S. on key technologies in the areas of defense, nuclear energy, aerospace and aviation,” says the paper. “This is a business mega-opportunity of more than $200 billion.”

Who’s Profiting From India’s Nuclear Buildup?

Some energy companies are already landing big deals in India.

One of the first was Westinghouse Electric Co. LLC, which announced joint venture with Larsen & Toubro to build nuclear reactors at the conclusion of the United States’ five-day trade mission to Mumbai in January.

France’s Areva SA followed, agreeing to supply the Nuclear Power Corporation of India Ltd. with six reactors just two days after India said it would allow the International Atomic Energy Agency (IAEA) to inspect 14 of its reactors. NPCIL Chairman and Managing Director S.K. Jain said the deal was worth $12.3 billion.

Still more nuclear power contracts are expected in coming months.

Canada’s Cameco Corp. might be one of the companies to ink a deal. The Saskatoon-based Cameco is the world’s largest uranium miner, making it vital to the global supply.

India will require about 1,600 metric tons of uranium per year to achieve the energy output it desires

The cash-rich Cameco reported an 86% increase in revenue for the fourth quarter of 2008, and Chief Executive Officer Gerald W. Grandey remains optimistic that his company will continue to weather the global financial crisis.

“Our customers are well-established electrical utilities, many government-owned or with regulated rate structures. In tough times, they run their low-cost nuclear plants at full capacity, assuring demand for our products,” Grandey said in a conference call last Tuesday. “Our strategy of seeking price protection in our contracting has reduced the sensitivity of our revenue to softening spot prices and we are seeing the benefit now,”

Uranium use will increase 3% annually over the next 10 years, as new reactors are built around the world, Grandey said. A short-term loan taken last June to help finance investments in new assets has been extended on good terms, and Cameco has also received new credit of $100 million.

Among those scheduled to meet with Indian interests, was Australian Prime Minister Kevin Rudd. However, Rudd decided to postpone his visit when Indian Prime Minister Manmohan Singh became ill and underwent heart surgery.

When the two leaders do eventually catch up with one another, they’ll have plenty to talk about with respect to India’s nuclear buildup. Australia is the world’s second-largest uranium producer, trailing only Canada.  Australia exports about 10,000 metric tons of uranium a year – representing a $900 million injection into the domestic economy.

Because India hasn’t signed the NPT, Australia has so far been coy about selling uranium to that country. But since the Nuclear Suppliers Group waiver, India has signed intergovernmental civil nuclear cooperation agreements with France, Russia, the United States and Kazakhstan. If Australia does change its position, BHP Billiton Ltd. (ADR: BHP) will be a big beneficiary.

BHP is the second-largest commodities company in the world, mining steel, aluminum, copper, iron, nickel, titanium, diamonds and gold. It is also proprietor of the world’s largest uranium deposit, the Olympic Dam.

In addition to suppliers, India will need partners to build and operate its new energy grid.

Fenil Maru, an equity advisor at ICICI Bank Ltd (ADR: ICICI), told Knowledge@Wharton that India’s Bharat Heavy Engineering is “looking for a tie-up and has been in talks with Alstom SA, GE Energy, Russia’s Leningrad Metal Factory and Siemens AG (ADR: SI).”

Vendors such as GE Hitachi Nuclear Energy Inc., Toshiba Westinghouse, and Areva also could be enlisted to provide light water reactors, which will be necessary in nuclear parks with six to eight reactors at in a single location.

Source:  India’s Nuclear “Explosion” a Cash Generator for Global Energy Companies

And not only here in the U.S., either.

France’s GDF Suez (GSZ:Paris), newly-formed energy group, and Spain’s Iberdrola (IBE:Madrid) just announced that they will join forces to build nuclear plants in the United Kingdom… As have German companies RWE and E.ON (EOA:Hamburg).

But friendly European countries teaming up to build nuclear power plants isn’t the only card in play. Nuclear energy is on the table in Russia, China, and Iran.

German company Siemens (SI:NYSE) is expected to partner with Rosatom in Russia to invest $45 million in a transformer factory. The two companies are hoping to partner on more projects, too, in both Russia and Germany, and also in other countries.

China is well on track to double its nuclear power capacity over the next ten years. In 2009 alone, the country expects to add 8.4 gigawatts-worth of nuclear power plants. In fact, China is investing about $84.8 billion in the power industry this year. Technology will come from “third-generation nuclear power technologies, such as the AP100 developed by the United States-based Westinghouse Electric Co,” said Fu Manchang, secretary-general of the Chinese Nuclear Society, to China.org.

With so much development on the nuclear energy agenda, it should come as no surprise that the geopolitical eye has once again fixed itself of Iran, and the posibility of its nuclear weapons program.

Today, representatives from five permanent member countries of the UN Security council met to talk about diplomacy and Iran’s nuclear ambitions. Yesterday, it became public that Iran had launched its first home-built satellite. This means that long-range weapons and the ability to fire ballistic missiles are fast becoming a reality.

This has folks a little edgy, as many people believe that if Iran gains nuclear weapons, and has the ability to fire long-range missiles, it might attack Israel.

But the UN Security council is encouraged by the new U.S. administration’s “willingness… to engage in talks with Iran.”

That won’t make the job any less hard, and if indeed Iran capitulates to every demand in order to pursue a peaceful nuclear energy program, would the UN Security council actually sanction the move? How can it not when China is pouring money into nuclear energy programs, and when Russia, our old Cold War enemy who is still dismantling its nuclear bombs, is partnering with Western companies to develop plants?

If we’re ready to negotiate, we’d better be ready for a nuclear Iran… even if it’s just to generate electricity, not bombs.

Source: Nuclear Energy Back on the Table

This from Money Morning:

Commentators are tripping over one another to declare this country or that country’s stimulus package as a primary reason to pour money into its stock market. Yet if you look at the highly damaging long-term effects of such loose monetary and fiscal policies, an investor can come to only one conclusion: You should invest in the country with the smallest stimulus package.

Stimulus packages are all the rage right now. President-elect Barack Obama has promised an $800 billion package for the United States, which equates to nearly 7% of U.S. gross domestic product (GDP). And there are plenty of others:

• Japan has a stimulus package of $720 billion – roughly 14% of GDP.
• South Korea plans two stimulus packages – the larger of them “green” – totaling about $50 billion, or about 6% of GDP.
• Great Britain is expected to inject about $177 billion into its economy, the equivalent of 8% of GDP.
• France has a modest $40 billion stimulus package in place but that’s on top of a $300 billion European Union (EU) stimulus package, so the total’s about 3% of GDP.
• China has announced a $586 billion stimulus – almost 20% of GDP – and now appears to have decided even that is too little.

Then there’s Germany. When the British stimulus was announced, Germany’s finance minister, Peer Steinbruck, described it as “crass Keynesianism.” Since then, he’s been forced to back off that stance a bit: On Jan. 12, Germany announced a stimulus plan totaling $70 billion over two years.

Still, even that is only is a relatively modest 2% of GDP, and Germany’s 2009 budget deficit – even with the stimulus – is projected to come in at less than 3% of GDP. That’s far less of a deficit than the country faced during the 2001-2003 recession, and means that Germany enjoys one of the soundest fiscal positions of any country in the world.

Germany’s short-term economic outlook is unexciting, as is currently the case for most countries. According to The Economist, the country’s GDP is forecast to shrink by 1.4% in 2009, after actually advancing 1.0% in 2008. That’s equal to the Euro zone average and equal to Japan, a bit less than the United States (projected at minus 1.2%), but better than Britain (minus 1.7%). But at a projected 1.0%, at least inflation at 1% is expected to be satisfactorily low.

Where Germany stands out, however, is when you look at its balance of payments, which is in surplus by $265 billion in the year to November 2008 – the equivalent of 6.6% of GDP. That immediately distinguishes it from the finance-based economies of the United States and Britain, both of which have perennial balance-of-payment deficits.

The most impressive thing about the German payments surplus is that it is achieved against a background of some of the highest wage rates in the world, very heavy tax and Social Security costs and a strong euro exchange rate. Even though it has among the world’s highest labor costs, Germany also has among the world’s highest labor skill levels, and those are more concentrated in manufacturing than in finance or business services, making the German economy less vulnerable to this finance-based recession or to erosion through globalization.

Like other countries, Germany will see its exports hit by this global recession, but it has the ability to grow domestic demand to compensate without affecting its budget or payments position.

For a decade and a half, the German economy and its budget were bedeviled by the huge costs of integrating the former communist East Germany into the West. However, that was a one-off cost; anyone who graduated high school in East Germany under Communism before 1989 is now nearing 40, so younger workers have been given the education and training common to their splendidly productive West German counterparts. From about 2005 on, the drag on the budget and on productivity from East German integration costs has begun to decline, and it will continue declining in the years ahead.

With its low budget deficit and large payments surplus, Germany is the strongest economy in the EU. It is potentially the strongest economy in the world; while the United States, Japan and Britain will struggle for years with the nasty side-effects of their massive government-stimulus spending, Germany will remain in sound shape.

It is thus likely that over the next few years, the huge flows of “safe haven” money that for decades helped prop up the U.S. Treasuries market will flow instead into the German bund and equities markets: After all, where the hell else is there? That will reduce German interest rates and increase multiples on German stocks. For an international investor, it thus becomes essential to have a significant part of your portfolio in German stocks.

What to buy? Well, for a start there’s the German exchange-traded fund (ETF), the iShares MSCI Germany Index (NYSE:EWG). At $334 million, it’s surprisingly small, but it has a Price/Earnings (P/E) ratio of 9.6, and a yield of 6.6%, so this ETF provides decent income as well as a broad exposure to the German market.

There are eight German companies whose American Depository Receipts (ADRs) have a full sponsored listing on the New York Stock Exchange (several others have moved to the Pink Sheets recently because of the costs of Sarbanes-Oxley compliance).

Of these, Allianz SE (ADR:AZ) and Deutsche Bank AG (DB) are both caught up in the travails of the global financial-services sector, while financial services industry’s travails, while Daimler AG (DAI) offers the limited prospects of the automotive industry (though Daimler’s a good bet once economic recovery is clearly in sight). Infineon Technologies AG (ADR: IFX), a semiconductor manufacturer, and Qimonda AG (ADR: QI), a maker of computer memory devices, are each currently making losses.

That means there are only three other possible recommendations, which is why, if you want a broad exposure to the German market, you should also consider a mutual fund or an ETF like EWG.

Deutsche Telekom AG (ADR:DT) is Germany’s traditional fixed-line telephone service, which has mobile operations and that also has increased revenue by providing high-speed Internet access services. Based on both 2008 and 2009 earnings, the P/E ratio of its shares is a somewhat high 15. On the other hand, however, the stock’s dividend yield is better than 8%. A dividend cut must be possible, but the company in general seems fairly recession-proof.

SAP AG (ADR:SAP), the well-known international maker and marketer of enterprise software, has a lower dividend yield of only 2.1%, but much better earnings-growth prospects: 2009 is currently projected ahead of 2008. At 14 times earnings, the stock currently looks cheap for this sector.

Siemens AG (ADR:SI) is active in a broad range of heavy equipment, including items such as locomotives and electric power plants – the very kinds of businesses that are likely to benefit from heavy “stimulus” spending worldwide, especially infusions aimed at infrastructure development, which is very much the case in China.

With Siemens having recovered from losses in 2006, the company’s shares are now trading on only 8 times estimated earnings for the year to September 2009, with a dividend yield of 3.7%. They seem attractively priced.

Source: Four Ways to Profit From the Country With the Smallest Stimulus Package

• German manufacturing and engineering titan MAN AG said it will acquire Volkswagen Truck and Bus from Volkswagen AG (OTC: VLKAY). The 250-year-old MAN AG is Europe’s third-largest truckmaker, and this purchase marks its first major South American investment, Bloomberg reported.

• Siemens AG (ADR:SI) will pay more than $1.3 billion to settle corporate corruption charges that it paid bribes to win major contracts in the United States and Germany. The scandal resulted in the resignations of former CEO Klaus Kleinfeld and ex-CEO and former supervisory board Chairman Heinrich von Pierer, Reuters reported.

• Mattel Inc. (MAT) will pay to settle a probe that its Chinese-made dolls and accessories shipped to the United States were made with lead paint. The toys never made it to the shelves, but the world’s largest toymaker will pay $12 million to the 39 states in the suit, Bloomberg reported.

• Irish banks will be on the receiving end of a $13.5 billion (10 billion euro) investment from the Ireland government, MarketWatch reported. The recapitalization plan may take the form of preference or ordinary shares, the government said in a statement. And the list of banks that will receive the cash has not been determined.

• The National Association of Home Builders/Wells Fargo housing market index remained at nine in December for the second month in a row, indicative of the pessimistic outlook permeating the market.  Index readings higher than 50 indicate positive sentiment about the market. It has slumped below 50 since May 2006 and has been below 20 since April.

• The Boeing Co. (BA) yesterday (Monday) increased its quarterly dividend by 5%, or 2 cents, to 42 cents. The aerospace and defense dividend is payable March 6, 2009 to shareholders of record as of Feb. 6, 2009.

• Homes in the United States will lose more $2 trillion dollars in value by the end of the year, and nearly 11.7 million American households currently owe more on their mortgage than their homes are worth, Reuters reported yesterday (Monday). “In general, homeowners in most areas we cover are struggling with foreclosures pouring into the market, large amounts of negative equity and dropping home values,” Dr. Stan Humphries, vice president of data and analytics for Zillow Real Estate Market Reports, said in a statement.

Source: Global Investing Roundups Tuesday, December 16th, 2008

European stocks ended higher on Friday, as buoyant pharmaceutical shares eclipsed a drop in cyclical mining and industrial sectors hit by renewed economic fears, while energy shares tumbled along with oil.

The FTSEurofirst 300 index of top European shares closed 1.1 percent higher at 862.07 points.

Although it gained 13 percent during the week, the index dropped 7 percent in November, recording a ninth month of losses in what has been a torrid 2008 for equities worldwide.

Pharma stocks made strong gains on Friday, with GlaxoSmithKline up 5.1 percent and Sanofi-Aventis up 4.5 percent. Novartis , whose CEO said the company could increase its dividend and also resume share buybacks once it has reduced its debt, gained 4.4 percent.

The sector rallied after the publication of a long-anticipated EU report on generic competition. Although Competition Commissioner Neelie Kroes said preliminary results showed competition in the pharmaceuticals industry “does not work as well as it should”, traders said the absence of specific penalties in the report brought some relief to pharma stocks.

Energy firms such as Total and BP dropped 0.7-2.6 percent as oil prices sank below $52 a barrel on signs OPEC would defer cutting production when it meets this weekend in Cairo.

Industrials were also among the biggest losers, with Siemens down 3.8 percent and Alstom down 6 percent.

Despite the market’s recovery during the week, analysts remain wary about a potential “Christmas rally” this year.

“The volatility is not about to come down immediately. The economic newsflow is just too horrible. It’s too early to call for a straight market rally at this point,” said Arthur van Slooten, strategist at Societe Generale, in Paris.

“With deflation fears, risky assets have been pricing in the worst. But it doesn’t mean that all of a sudden, from now on you have a straight way up. We know that the newsflow will be terrible, but we need at least some sort of indication that the bottom is maybe in sight,” he said.

“Next year’s first quarter will really look awful in terms of macro data and with analyst further downgrading their estimates and companies finally becoming realistic in their own guidance. That in itself could provide us with a sound basis to build from there.”

Miners took a beating on Friday, adding to recent sharp losses. Anglo American shed 2.4 percent and Xstrata dropped 3 percent.

Prices for copper, a key industrial metal, slipped as tumbling industrial production data from Japan highlighted bleak prospects for demand in an oversupplied market, while prices for aluminium also fell, hit by the rising fears about the health of the embattled auto sector.

“There is little doubt that the outlook for metals demand is grim for at least the next few quarters and prices have fallen to levels that reflect market expectations for further stock increases,” Barclays Capital said in a note.

Automakers lost ground, with Volkswagen down 5 percent, BMW off 3.4 percent and Renault down 4.8 percent.

“Going into the weekend, one can’t help but worry that we are only a heartbeat away from the next scare story,” said Chris Hossain, senior sales manager at ODL Securities.

“The markets appear to have been buoyed by the feeling that the U.S. will be bailing out the auto industry, but one has to wonder how much more the global governments can continue to support troubled industries,” he added.

Around Europe, Germany’s DAX index eked out a gain of 0.1 percent, UK’s FTSE 100 index rose 1.5 percent and France’s CAC 40 added 0.4 percent.

By Blaise Robinson
PARIS, Nov 28 (Reuters)

• Siemens AG (SI) put aside nearly $1.3 billion to settle charges that it bribed government officials around the world to win contracts. The concessionary provision will affect earnings for the year ended Sept. 30, Bloomberg reported.

• Internet titan Google Inc. (GOOG) announced Wednesday (yesterday) that its wariness for antitrust-related legal battles ultimately killed discussions with Yahoo Inc. (YHOO) about forming an advertising partnership, the New York Times reported. The breakdown reopens the door for a possible Yahoo-Microsoft Corp. (MSFT) relationship, which also has its share of starts and stops.

• Enbridge Inc. (ENB) announced quarterly profits rose 88% and net income spiked $130.4 million, or 41 cents a share, for the third quarter, Bloomberg reported. Canada’s largest pipeline company said volume increased 33% on the Athabasca liquid pipeline system, a major artery into one of the world’s most oil rich fields.

• The FCC voted 5-0 in approval of Sprint Nextel Corp’s (S) June purchase of Clearwire Corp., MarketWatch reported. The merger is critical to the survival of both, as they claimed to be unable to build a mobile wireless Internet network that could compete with rival AT&T (T).

• GMAC Financial Services, a division of General Motors Corp. (GM) said yesterday (Wednesday) that its third-quarter loss widened to $2.52 billion. GMAC had a loss of $1.6 billion during the year-earlier period. Third-quarter revenue fell 24% to $1.72 billion from $2.25 billion. GM reports earnings tomorrow (Friday).

• Time Warner Inc. (TWX) reported net income of $1.07 billion, or 30 cents a share, for the three months ended Sept. 30. Revenue was at $11.71 billion, relatively unchanged from last year’s  $11.68 billion. The company reported 18% growth in profits from continuing operations.

• Molson Coors Brewing Co. (TAP) yesterday (Wednesday) announced a 28% increase in third-quarter profit. The company reported third quarter net income of $173.2 million, or 94 cents per share, up from $134.7 million, or 74 cents per share, a year ago.

• News Corp. (NWS) said yesterday (Wednesday) that first-quarter net income dropped 30% from a year ago. Net income fell to $515 million, or 20 cents per share, compared with $732 million, or 23 cents per share, in the year-earlier period. Revenue rose 6.3% to $7.5 billion.

Source:Global Investing Roundups Thursday, November 6th, 2008

For investors who want to minimize risk in a relatively new industry, Martin recommends General Electric (NYSE:GE) and Siemens AG (NYSE:SI). These blue chips are making significant investments in wind energy projects.

Meanwhile, small-cap AeroVironment (NASDAQ:AVAV) is well placed in the emerging market of home and office-based wind power generation.

This from The Smart Profits Report:

He’s not just an oilman any more. Renowned oil investor T. Boone Pickens has shifted his attention to a renewable energy resource – and is pumping a ton of money into it.

You may have seen the old fella championing the cause in television commercials recently, and across America, some ordinary citizens are jumping on board, too.

I’m talking about wind power. With oil prices still in triple-digit territory and many renewable resources (including wind power) still in their infancy, power generation isn’t coming cheap these days.

Those Americans willing to shell out $5,000 for a 300-pound, home-based wind turbine shouldn’t expect much return on their investment anytime soon. Because they’re so small, they don’t generate that much electricity. But if energy prices continue to rise (as seems likely), it could pay off over time, as technology advances.

The trend is catching on, too. New York mayor Michael Bloomberg has thrown his weight behind home and office-based wind power with a bold proposal to spread turbines across the city. Other cities like Boston (with 20 turbines at Logan Airport) and San Francisco have also shown their support for the efforts and San Francisco’s government is pondering whether to offer wind power incentives.

In addition, Pickens has placed a $2 billion order with General Electric for 667 of its wind turbines that can produce 1.5 megawatts of electricity – part of the $10-billion Pickens Plan for alternative energy and for wind power to make up 20% of U.S. energy needs. Eventually, that will rise to 1,000 megawatts – enough to power 300,000 homes.

And Pickens plans to pump another $6 billion into GE’s coffers for turbines that will power the 4,000-megawatt Pampa Project.

As he recently stated: “We’re paying $700 billion a year for foreign oil. It’s breaking us as a nation, and I want to elevate that question to the presidential debate, to make it the No. 1 issue of the campaign this year.”

He continues… “Neither presidential candidate is talking about solving the oil problem. So we’re going to make ‘em talk about it. Where do you think we’re going to be in 10 years when our economy is busted and we’re importing 80% of our oil?”

He’s got a point. Previous presidents have boldly declared their intent to free America from the shackles of foreign oil, but it’s never happened. Pickens believes that wind power can compete favorably with electricity produced from natural gas.

And General Electric is on the case…

Alternative Energy Source is Boosted by General Electric

GE is also a major player in boosting America’s wind power capabilities. The company will invest in 76 wind farms, which should pump out more than 4,000 megawatts of power.

Its GE Financial Services unit also recently announced that it will splash out $100 million on three wind farms in upstate New York. The farms are due to be completed during the fourth quarter and will take the state’s wind-producing capacity to 47% and generate enough power (330 megawatts) for 110,000 homes.

But in terms of home and office-based wind power generation, it’s a movement that is steadily gathering support – support that could grow further as technology improves and prices come down. Having a big dog like Pickens on board can only help.

Tiny Turbines From The “Aero” Guys

One company leading the way in this area is AeroVironment, which sells its turbines for $6,500. Demand is high and the firm is already responsible for the turbines at the Brooklyn Navy Yard and Logan Airport in Boston. It says that areas where electricity prices are high could benefit from these turbines, which could pay for themselves in 4-8 years, according to an article in the New York Times.

But if you want to go with a safer, more diversified pick in this still young industry, consider GE and Siemens AG (NYSE:SI). The latter is supplying the turbines for a 500-megawatt wind farm in my British homeland.

Xcelerated Profits Report readers are already familiar with GE. A few months ago, Investment Director Karim Rahemtulla suggested four different ways to play the firm, which is enough to capture both short-term and long-term upside, while also minimizing risk.

If you’re not a member, you should be. The market might be getting killed, but my colleagues are thriving anyway – whether it’s Marc Lichtenfeld’s small-cap healthcare stocks, Lee Lowell’s correct commodities calls, or Jim Stanton’s recommendations. For more information, take a look here.

Source: Alternative Energy Sources Are Growing Fast

Several of the EU’s newer member states are currently holding bids for new plants. And having a clean and reliable energy source will spur industrial growth in the region, creating attractive investment opportunities in the process.

More from Sara with the countries most likely to benefit from this new energy drive…

The word nuclear stirs up all kinds of fears nowadays… Everything from Chernobyl to Iran comes to mind, and the fallout is – in my opinion – mostly political. So what does it say when nine countries in central and southeast Europe take up the atom?

We’ve heard that China wants to build 30 new nuclear reactors over the next 15 years, and now news has hit the public that Russia will spend $40 billion to boost its nuclear power sector over the next seven years…

But have you heard that Turkey, long-pressed by an energy shortage, has plans to build three nuclear plants? By September 24, it will close the call for bids to build the first nuclear plant in the country.

Turkey’s not alone either. Albania wants Italy’s Enel (BIT:ENEL)(ENLAY.PK) to build a nuclear plant on its soil. Poland is in the running to build a 3,200 MW facility in neighboring Lithuania.

The list goes on…

There are some interesting names floating around, too. You’ve got your regulars: Areva (EPA:CEI) and Siemens (SI:NYSE). But then you’ve got the Czech Republic’s power group, CEZ (ISIN: CZ0005112300), who’s planning two new units in the country… Germany’s RWE AG (ISIN: DE0007037129), who’s bidding on a plant Bulgaria and another in Romania… Belgium’s Electrabel (ELBSB:Brussells), owned by France’s GDF Suez (EPA:GSZ) is also bidding on the Bulgarian and Romanian plants… and Spain’s Iberdrola (IBE:Madrid) is a candidate for the Romanian plant.

For this region as a whole, cheap and reliable power means greater productivity and industrial growth. It’s the cornerstone of stellar GDP growth, and there will be some nice jumps over the next eight to twelve quarters, particularly for the Czech Republic and Romania. Keep an eye on Turkey and Slovakia as well…

Source: The Eastern Nuclear Bloc