Tuesday, June 5, 2012

Don Coxe Interview by KWN

Donald Coxe: Global Strategy Advisor, BMO Financial Group & Chairman, Coxe Advisors LLP. - Don is the Global Strategy Advisor to BMO Financial Group, which has $538 billion in assets. Don has more than 40 years of institutional investment experience in Canada and the US. His investment journal, Basic Points, published since 1992, and his conference calls are distributed exclusively for their clients in North America, Europe and Asia. Don also heads up the Global Commodity Strategy investment management team – a collaboration of Coxe Advisors and Harris Investments – to create and market commodity-oriented solutions for investors. He is advisor to the Coxe Commodity Strategy Fund and the Coxe Global Agribusiness Income Fund in CA, and the Virtus Global Commodity Stock fund in the US.

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Three Months to Save the Euro: George Soros

Euro-zone governments have around three months to ensure the survival of the single currency, billionaire investor George Soros said in a speech on Saturday.

“We are at an inflection point. After the expiration of the three months’ window, the markets will continue to demand more but the authorities will not be able to meet their demands,” he warned in a speech at the Festival of Economics in Trento, Italy. (Read the text of his speech.)

The European Union is “like a bubble” – not a financial bubble but a political bubble -- that could pop as a result of the euro -zone crisis, Soros said.

“In the boom phase, the EU was what the psychoanalyst David Tuckett calls a ‘fantastic object’ – unreal but immensely attractive,” he said. (more)

Reaching Extreme Levels for Bonds, Gold, Silver, SP500, and Oil

Market Analysis Points:

  • US dollar index in consolidation and also forming a mini head and shoulders pattern which if the neckline is broken points to lower prices for the dollar that may last 1-2 sessions.
  • Gold and silver are both trading at resistance levels and are headline driven at this point. Anything could happen going forward so I remain on the side for now.
  • Oil continues to show weakness but is now trading within a major support level. I am keeping my eye on the intraday charts for a reversal pattern to play a bounce/rally this week.
  • Bonds continue to rise with record low yields... This shows there is real panic fear in the market and lower prices may continue for another week or two.
  • The volatility index while elevated is still overall trading low. This means more downside is possible investors and baby boomers start to roll more of their money out of stocks and into bonds.
  • SP500 sold down another 1% in futures trading after the closing bell which was very bearish. This morning we have seen the dollar index pullback and that has allowed the SP500 to recover the 1% post market drop on Friday.

Those of you short the SP500 with me should tighten your stops in case there is a sharp rebound in the market. The position is up over 9.5% in less than 5 days and I want to lock in a good chunk of that with a stop at this morning's high in the market or your low for your inverse fund depending on what you are trading. (more)

Interview With David Morgan

The Break-Out Stock You Can't Afford to Ignore

I couldn't believe my eyes when I walked into the store. There were literally dozens of smartly-dressed women excitedly seeking out their sizes in a variety of clothing items. The shoppers were completely undeterred by the relatively high prices but rather focused on just how good their purchases would make them look at the gym, yoga class or just as casual wear.

I quickly remembered Fidelity Investments' Peter Lynch and his investing rule, "buy what you know," as my wife came out of the dressing room modeling her latest tennis/workout skirt for my approval. Not only did the outfit look great, but the craftsmanship and unique fabric sealed the deal -- despite the very high price point.

If you haven't guessed it, then the store we were in was lululemon athletica (Nasdaq: LULU). Riding on the resurgence of the fitness/yoga craze that started in the 1970s, lululemon has built a powerhouse fashion empire on women's desire for quality, looks, comfort and functionality. It's also been one of the hottest stocks on Wall Street in recent memory..(more)

Why People Are Going Nuts Over The New George Soros Speech On Europe

People are going crazy for the new George Soros speech on Europe, which is available on his official website.

We called it brilliant and a dynamo in our post on it yesterday.

The hedge funder who first passed it onto us called it "unbelievable."

One of our favorite China bloggers, the pseudonymous Also Sprach Analyst called it "The best thing ever written on the euro crisis."

The bottom line is that the speech is getting praised and passed around and going viral in a way that most speeches about the Eurozone don't. (more)

Royalty firms could spur junior miner deal bonanza

Royalty companies that raked in cash from strong precious metal prices in the last three years look poised to drive a wave of deal activity in the Canadian mining sector, especially among junior players hungry for financing.

These companies, which fund projects in return for a portion of future revenues, generated huge amounts of cash flow from existing deals as the price of gold and silver soared since the beginning of 2009.

Now, with the recent pullback in precious metal prices and slumping stock markets, they could be the saviors for small and mid-tier miners who are eager to grow but strapped for capital.

Europe's debt crisis and slowing Asian growth have tempered banks' appetite for lending. And miners are not keen to issue equity when their share prices are severely depressed, leaving few alternatives to royalty and stream deals for small miners looking to fund project development.(more)

The Bank of New York Mellon Corp. (NYSE: BK)

The Bank of New York Mellon Corporation is a global financial services company. The company divides its businesses into two principal segments: Investment Management and Investment Services. It has another segment, which includes credit-related activities, the lease financing portfolio, corporate treasury activities (including its investment securities portfolio), its equity investments in Wing Hang Bank Limited and ConvergEx Group, business exits and corporate overhead. Its two banks are The Bank of New York Mellon, which houses its institutional businesses, including asset servicing, issuer services, treasury services, broker-dealer and advisor services.

To analyze New York Mellon's stock for potential trading opportunities, please take a look at the 1-year chart of BK (The Bank of New York Mellon Corporation) below with my added notations:

I noticed BK because of its key level at $20. Not only can you see the $20 support (green) from January until present and from back in November, but the $20 resistance (red) was apparent back in the October and December periods of time. So, the $20 price is the current key level to this stock. If you are bearish, you might consider shorting BK on a break of $20, but if you are bullish, you would want to buy the stock at $20.

The Tale of the Tape: BK presents a couple of very simple trading opportunities based on its key level of $20. A short position could be entered IF the stock breaks below $20 with a stop set above that level, or a long play could be made on a pullback to $20 if that should happen.