Market Watch with Tom Waitt

March_9th_2011.mp3 Yesterday's News    What goes up goes up? What goes down goes down? Time to ground your thoughts.    Bank of America Corporation (Click For Larger Picture) Gold, 100 Troy Oz. COMEX (Click For Larger Picture) Media and market participants often get caught up in the mood of the moment and excite emotions to a fever pitch. Markets feed on these emotions and take things to a euphoric level. Media sensationalizes the movement by finding reinforcing reasons for even higher levels. Infomercials bolster the fever and what goes up goes up goes up. Pessimism also spreads like wildfire as negative news brings more negative news and panic and fear set in. Does it ever end? Newton's law of gravity will come into play "What goes up must come down; for every action there is equal and opposite reaction." One must learn to think outside of the box and step off a trend before it ends. Parabolic moves are a tell tale sign that warns us to be nimble and assess our curre

March_2nd_2011.mp3 Confidence Returning    Mid East turmoil, gold at record highs, rising oil prices; media outlets feeding the frenzy with daily reports of further woes of rebellion and coming inflation.    Private U.S. Payrolls (Click For Larger Picture) Recent news reports of spreading Mid East rebellions causing global chaos and uncertainty, instilling fears of food inflation along with minute by minute reports of Gold hitting record highs, news reports of soaring oil prices which are actually down 32% from their peak. Yet stocks in North America are up 97% on the S&P 500 and 89% on the TSX from lows hit in 2009. Is confidence back? Market participants had lost trust in financial markets and politicians. Recently investors are starting to believe markets will achieve increased economic activity. With money supply at an all time high and World Governments continuing to spend at record levels the economy is improving. However it is key that private enterprise not Gove

February_23rd_2011.mp3 Trading Volatility    Textbooks suggest a well diversified investment portfolio often linked to a stock index or a mutual fund. The trouble is most equity indexes and mutual funds are at the same level as 10 years ago, the lost decade for investment returns. Is it time to differentiate yourself when investing.    VIX - Volatility Index (Click For Larger Picture) Many investors have lost money in the last ten years patiently waiting for their mutual funds and stocks to show a positive return. Meanwhile there have been individual stocks that have soared and plunged in value. An over diversified portfolio is like a shotgun peppering shots over a wide area while a rifle is aimed at a target. In today's investment environment it is time to define ones investment goals, target a limited number of stocks based on a well thought out risk/reward analysis. This is a trading environment and requires active management. There are many opportunities to make money

February_16th_2011.mp3 Population, Freedom and Prosperity    China, India and the rest of Asia (and now Africa) have moved into the modern era. Freedom and prosperity are in demand; the rest of the world wants the American dream.   World Population by Country (Click For Larger Picture) The wonderful living standards of the developed nations is transmitted globally in this the age of instant communications; cell phones, facebook, hand held computers, youtube, twitter, transcending language barriers, religion and demographics. One of the great changes in history is Asia's amazing climb out of poverty. The changes are remarkable. Every year ten million new mouths enter China's enormous work force, they are all looking for jobs. The average wage in Egypt is two to four dollars a day. In much of Africa people work for just the food that keeps them from starvation. As the standard of living in Asia and Africa rises, the standard of living in the developed nations declines. The pe

February_9th_2011.mp3 Inflation?    Inflation is described as too many dollars chasing too few goods. Soaring commodity prices have the media and market pundits warning of rising inflation.   Annual Inflation Rate (Click For Larger Picture) Many analysts warn that the current easy money policy by global central banks will devalue currency and push commodities including food stock to levels unaffordable by many already unemployed. Cotton prices have soared to levels not seen since the U.S. Civil War. Gold has hit record highs; Oil remains above $85 a barrel. Commodity prices are rising, forcing your grocery bill higher. Is inflation a problem? From 1914 until 2011, the average inflation rate in United States was 3.38 percent reaching an historical high of 23.70 percent in June of 1920 and a record low of -15.80 percent in June of 1921. The inflation rate in United States was recently reported at 1.50 percent. The liquidity crisis had us in a deflationary spiral; recent global go

February_2nd_2011.mp3 Increased Economic Activity    Equities are rallying to levels last seen 2 ½ years ago. Gold is off record highs even with unrest and political chaos in the Middle East.   ISM Manufacturing Index (Click For Larger Picture) Many investors that bought into a mutual fund or a hedge fund have not made a cent over the last 5 or 10 years, indeed with fees they find their holdings are at a loss. However from the lows reached at the crash low two years ago when the Dow Jones Industrial Index feel to 6,469.95 on March 6th 2009 to the high reached this morning at 12,001.11 have amounted to an incredible 85.5% move. Still there are many individuals, hedge funds and mutual funds that have not kept pace with these stellar returns. Timing is everything!   There are many opportunities to make money but it requires action on your part, each stock selected must show risk/reward of at least 2:1. Make the call - let me provide you with a unique perspective on your inv

January_26th_2011.mp3 Stellar Return    We have all heard that the equity market returns have been disappointing with little appreciation in the last 10 years. Buy and hold as a strategy has frustrated investors and mutual fund managers. However major moves have occurred.   Dow Jones Industrial Average (Click For Larger Picture) Many investors that bought into a mutual fund or a hedge fund have not made a cent over the last 5 or 10 years, indeed with fees they find their holdings are at a loss. However from the lows reached at the crash low two years ago when the Dow Jones Industrial Index feel to 6,469.95 on March 6th 2009 to the high reached this morning at 12,001.11 have amounted to an incredible 85.5% move. Still there are many individuals, hedge funds and mutual funds that have not kept pace with these stellar returns. Timing is everything!   There are many opportunities to make money but it requires action on your part, each stock selected must show risk/reward of at

January_12th_2011.mp3 Half Empty, or Half Full?    Is the glass half empty, or half full? Commodity prices have soared over the last several months approaching highs set over two years ago.   CRB Index (Click For Larger Picture) Soaring commodity prices have the media and market pundits warning of soaring inflation. Many analysts warn that the current easy money policy by global central banks will devalue currency and push commodities including food stock to levels unaffordable by many already unemployed. However bleak things seem, there is often another side to the story. Volatility usually goes to extremes in markets; the last time commodities measured by the Commodity Research Bureau Index known by the CRB Index peaked in 2008 it rapidly fell 36%. Oil went from its peak of $147.50 a barrel in July 2008 to $33.20 by January 2009. Gold also retreated 34%. Volatility is evident over the 64 years shown and as we reach extremes we should be aware the glass is often

January_5th_2011.mp3 Global Market Returns 2010    Trillions of dollars trade in milliseconds all over the World. Global events affect financial markets instantaneously, "money never sleeps".   Global Market Results - 2010 (Click For Larger Picture) Global equity markets have mixed returns shifting rapidly day to day second to second. In 2010 the worst performing equity exchange was the Greek Athex composite exchange falling 35.6%. The best performing exchange for 2010 was Peru's Lima general exchange rising 65%. Canada's TSX Venture exchange was in the top 3 returning 50.4%. North American equity markets claimed middle ground with positive returns in the 11 to 17% area. Junior cap issues outpaced senior and intermediate stocks.   There are many opportunities to make money but it requires action on your part, each stock selected must show risk/reward of at least 2:1. Make the call - let me provide you with a unique perspective on your investments through a no-obli

December_29th_2010.mp3 Dollar Value    What will 2011 have in store for the markets? Has confidence returned? Equities are rallying but Gold is near record highs. What indicator is relevant at the current juncture?   U.S. Dollar (Click For Larger Picture) Uncertainty and fear has ruled over the last decade. Mutual funds and most stocks have lost money over the last 10 years. Interest rates have fallen to record lows. Money supply is at an all time high while the rate of turnover of currency has slowed to a third of normal activity. World Governments continuing to spend at record levels and the economy is improving slowly. What can occur with the multiplier of money which is the turnover of a dollar is an explosion of economic activity which will initially show up in the value of the Worlds main currency which is still the U.S. Dollar.   There are many opportunities to make money but it requires action on your part, each stock selected must show risk/reward of at least 2:1

December_22nd_2010.mp3 Slippery Oil    Crude Oil rose to its highest level in over two years this morning hitting $90.80 a barrel.   Crude Oil (Click For Larger Picture) Crude oil posted its highest level since October 2008 trading $90.80 a barrel this morning. Crude is up 35% from 2010 lows set May 29th. In the last 3 years crude has traded as high as $147.50 a barrel in July 2008 and as low as $33.20 in January 2009. The midpoint of those extremes is $90.35. Calls for $100 plus oil are filling the prediction files for 2011. Before investors get too long, consider we are not only at the midpoint of the last 3 years but also midway in a trading band of $80 to $100. It is yet another flag in the overall markets that warns us to be nimble and assess our current positions.   There are many opportunities to make money but it requires action on your part, each stock selected must show risk/reward of at least 2:1. Make the call - let me provide you with a unique perspective

December_15th_2010.mp3 2010 Returns    As we approach the end of 2010 annual performance is in focus. It is difficult enough to track our own equity markets day to day but Global Markets and events are important in this millisecond decision making World.   Global Market Results (Click For Larger Picture) Global events and market fluctuations affect domestic and international markets instantaneously. Global equity markets have mixed returns shifting rapidly day to day minute to minute. At this point in time Japanese stocks are the weakest in 2010 off 2.2%. The strongest global equity player is Germany with an advance of 17.1% this year. North American equity markets are all up over 10% with junior cap issues outpacing senior and intermediate stocks. In Currencies the Euro remains weak off 6.8% so far in 2010.Silver is leading global commodity markets soaring 75% this year. When investing in equities it is important to realize that it is a market of stocks not a stock market

December_8th_2010.mp3 Lumber Building Value    Investors often act like lemmings, mythically following lock step till they fall off a cliff. Gold making record highs much like 1980 which ended at half their peak within two years. Dot Com stocks that disappeared after trading at incredible multiples, or equity indexes falling in half suddenly only to double once again.   Lumber (Click For Larger Picture) There is always an explanation after the fact once a major move occurs. Recent euphoria in Gold and Silver is different than the inflation induced line up at banks to by gold as a stay of value in 1980. Commodities have become a currency that will hold value even if the U.S. dollar weakens or the Euro plunges. But it will end as other avenues become more attractive. The key to investing is best explained by one of the top traders in the world George Soros; "Economic history is a never-ending series of episodes based on falsehoods and lies, not truths. It represents the path to big

December_1st_2010.mp3 Toronto Stock Exchange - Up, Down, Up      S&P TSX Composite Index We have all heard that the equity market returns have been disappointing, with little appreciation in the last 10 years. Buy and hold as a strategy has frustrated investors and mutual fund managers, however major moves have occurred in between. Many investors have bought into a mutual fund or an equity index and have not made a cent over the last 10 years. Indeed, with fees they find their holdings are at a loss. However, from September 1999 to September 2000 the Toronto Stock Index rose 70%; from September 2000 to October 2002 fell 50%, only to rise 167% from October 2002 to June 2008. The recent crash fell 51% from June 2008 to March 2009, since then, rose 75% to highs reached last month. In 2010 alone the Toronto Stock Exchange fell 6.4% by February rose 12.1% by April, slipped 10.2% by July and has rallied 18.5% by November 2010. Timing is everything!   There are many

November_17th_2010.mp3 What Goes Up, Comes Down    So far in 2010, cotton prices have risen 90.5%, Silver 62.9%, Coffee 52%, Corn 36.1%, Wheat 30.0% and Gold 28.1%. Do we have inflation?   Gold 100 Troy oz. (click for larger picture) Crude Oil Light Sweet (click for larger picture) In the last week, Gold fell $95.30 an ounce, 7.2%; Oil is off $7.45 a barrel, 8.4%. What has changed? The U.S. dollar has reversed direction and is getting stronger while European markets are re-visiting sovereign debt problems. Inflation is described as too many dollars chasing too few goods; inversely Deflation is too many goods for too few dollars. Which environment would you like to be in? Textbooks suggest a well diversified investment portfolio often linked to a stock index or a mutual fund. The trouble is, most equity indexes and mutual funds are at the same level as 10 years ago, the lost decade for investment returns. In today's investment environment it is time to define ones investment goa

November_10th_2010.mp3 Improved Economic Activity?    Has confidence returned? Equities are rallying, but Gold is at record highs.   U.S. Dollar - Long Term Chart (click for larger picture) U.S. Dollar - Short Term Chart (click for larger picture) Over the last decade, uncertainty and fear has ruled. Gold is at record highs, mutual funds and stocks have lost money over the last 10 years, interest rates are falling to record lows, and mortgage foreclosures with a near meltdown in financial markets . Confidence is the key, market participants have lost trust in financial markets and politicians. Recently investors are starting to believe markets will achieve increased economic activity. With money supply at an all time high and World Governments continuing to spend at record levels the economy is improving. What can occur with the multiplier of money which is the turnover of a dollar which has slowed from three times a day to less than once a day is an explosion of e

November_3rd_2010.mp3 U.S. Unemployment - #1 Concern    Yesterday the political landscape changed in the United States and likely in the entire World.   United States Unemployment Rate (click for larger picture) Republicans seized control of the U.S. House and narrowed the Senate's Democratic majority in elections shaped by voter anxiety over jobs and the economy. Republicans gained at least 60 House seats yesterday across the country, capitalizing on concerns about government spending unemployment and delivering a rebuke to the domestic agenda of President Barack Obama. Republicans scored a net gain of at least six seats in the Senate, winning Democratic-held seats in Illinois, Indiana, Arkansas, Pennsylvania, North Dakota and Wisconsin. Republican John Boehner of Ohio, in line to replace Democrat Nancy Pelosi as House speaker, told supporters in Washington late last night suggested "We're witnessing a repudiation of Washington, a repudiation of big government and a repudiation

October_27th_2010.mp3 Inflation / Deflation    Cotton prices have soared to levels not seen since the U.S. Civil War. Gold has hit record highs; oil remains above $80 a barrel. Commodity prices are rising, forcing your grocery bill higher. Is inflation a problem?   Annual Inflation Rate (click for larger picture) Inflation is described as too many dollars chasing too few goods; inversely Deflation is too many goods for too few dollars. Which environment would you like to be in? If you have the goods people are rushing to buy like oil or gold or I-Pads you're O.K. If on the other hand you are flush with real estate in an oil soiled beach in Florida; not so good. The liquidity crisis had us in a deflationary spiral; recent global government spending has successfully turned the trend back to an inflationary bent.   There are many opportunities to make money but it requires action on your part, each stock selected must show risk/reward of at least 2:1. Make the call - let me pr

October_20th_2010.mp3 Money and Trust    Uncertainty rules; Gold at record highs, mutual funds losing money, interest rates at record lows, stocks up one day down the next day, mortgage foreclosures hitting legal challenges, flash crashes keeping investors on edge. What is the key to future prosperity?   Money Supply (click for larger picture) Money Multiplier (click for larger picture) Confidence is the key, market participants have lost trust in financial markets and politicians. If investors can envision and start to believe, markets will achieve through increased economic activity. Money supply is at an all time high with World Governments spending at record levels to stimulate the economy but the multiplier of money has fallen to post war lows. The turn of a dollar has slowed from three times a day to less than once a day.   There are many opportunities to make money but it requires action on your part, each stock selected must show risk/reward of at least 2