Market Watch with Tom Waitt

October_6th_2010.mp3 Parity?    The Canadian Dollar value measured against major currencies affects the price of everyday purchases and investments. Recent commodity strength and U.S. Dollar weakness globally are pushing the Canadian Dollar toward parity to the American Dollar.   Canadian Dollar (click for larger picture) In 2010 the Canadian Dollar traded as high as 1.0066 U.S. dollars in April and as low as .9215 U.S. dollars one month latter in May. To realize the absolute value of this one month change consider a $25,000 U.S. car; it would cost $24,836 Canadian in April and as much as $27,130 Canadian one month latter in May, a difference of 9.2% which would also be your investment return on your money if you correctly anticipated the currency movement when investing. To highlight this point further the post war low on the Canadian dollar was .6179 in 2002 and reached a premium high against the U.S. of 1.1038 in 2007. The $25,000 U.S. car would have cost $40,460 in 2002 but on

September_29th_2010.mp3 Breaking Out of the Range    Global equities have traded within a 100 point range on the S&P 500 stock index over the last year, with several opportunities to buy at the 1045 level and sell at 1145 taking out 9.5% a number of times. Recent strength suggests a new upward bias.   S&P 500 Index (click for larger picture) As we approach the end of the third quarter fear and bearish forecasts still surround equity markets. It appears the third quarter will show a 10.9% advance from the 2nd quarter of 2010 using the bellwether S&P 500 Index and up 2.5% so far in 2010. However we are still up 7.8% from year ago levels.   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-obligation consultation. Contact me by filling out the 'Unique Perspective' form on the Co

September_22nd_2010.mp3 Post Recession Rally    Economists officially declare that the recession ended in June 2009.   Money Flows (click for larger picture) Well its official, economists have declared that the recession ended 14 months ago. Since that time U.S. stock indexes are up 32% Canadian composite equities are 25% higher. Their timing might be off but have quashed fears of a double dip recession. A rising money flow line indicates that buyers of equities are being more aggressive, a falling line indicates more aggressive selling.  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-obligation consultation. Contact me by filling out the 'Unique Perspective' form on the Contact page, or by calling at 1-204-982-0633. Before trading, please contact an investment professional. &

September_15th_2010.mp3 Record Highs    Once again Gold bugs have infested the air waves. A record high was set yesterday at $1,276.50 an ounce, 7/10 of a percent above the last high in June. Should you buy or sell?   Gold (click for larger picture) Gold bugs are on the march again recommending holding gold as a core position in ones portfolio of investments. Gold is touted as the global currency and store of value in uncertain times. A historic peak in 1980 was $887.50 which fell 71% to lows set in 1999 of 253.70. Over the last 11 years it has risen a whopping 503% and was a great trade. But is it a good investment at $1270 an ounce today? It took 27 years to return to levels of 1980. In order to assess a current position one needs to determine upside potential and downside risk. Carefully choose investments based on their merit and not by recent popularity. Is there a dividend on gold? Is demand and supply in balance? One TV infomercial suggests you buy gold coins, another sug

September_8th_2010.mp3 Copper - A Leading Indicator    Double dip? Recession concerns? Economic recovery? More stimulus spending required? Concerns of global recession permeate every newscast. What indicator should we watch to gauge the economy of the future?   Copper (click for larger picture) Recessionary fears are affecting communities globally and many are wondering if the situation is getting worse or if there is some improvement underway. Many gauge the U.S. dollar value or bond yield levels but both these indicators are being influenced by massive deficit spending plans globally. Gold is an indicator of fear and uncertainty not of economic activity. Historically copper prices have been a more accurate indicator of economic activity. Copper prices peaked at $4.26 a pound on, May 10th 2008 and dropped to a low of $1.25 by the end of 2008. Since that time we have seen Copper prices triple to $3.68 on April 17th 2010. China's investments in fixed urban assets such as rai

September_1st_2010.mp3 Bonds Fall, Rates Rise    Investors have been disappointed with the performance, or lack of performance of their mutual funds. Equity markets despite volatility have not been friendly to the buy and hold mentality. Many investors are jumping out the frying pan and into the fire of rising interest rates.   30 year US Treasury Bond Index (click for larger picture) Frustrations from 10 years of underperformance have seen many investors lock in a fixed rate at near record lows. The global bond market is more than three times the size of the Worlds' equity market, so what happens to bonds is crucially important. Bonds are in a huge bubble and that bubble could be very near bursting. Bonds could be killed by the slightest hint of higher interest rates. The bond markets response to Bernanke's speech last Friday was to crack bonds wide open as a preview of what can happen. In one day, three years of interest is down the drain as the bond values fell. Buying or

August_25th_2010.mp3 Fear and Greed    In the movie 'Wall Street', Gordon Gekko says, 'Greed is Good' as the market soars higher. In market parlance, the opposite of greed is fear which is bad for investments, as the market has a tendency to scare people out at the bottom and suck them in at the top.   Market Emotion Cycle (click for larger picture) 'Fear and Greed' tend to rule at market tops and bottoms. The market emotion cycle sees optimism turn to excitement, the thrill leads to euphoria and greed, slipping to anxiety, denial and fear followed by desperation panic, capitulation, despondency, depression, disgust and doubt. Globalization is upon us, with what happens half way around the globe reported immediately and reflected in equity and bond market prices with virtually no delay. The problem is the global attitude, influenced by events turns cold and hot with every movement. The international investor attitudes changes in sync with yesterday's news reports. Market down, glo

August_18th_2010.mp3 Global Market Results    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 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 12.38%. The strongest global equity player is Germany with an advance of 3.93% this year. North American equity markets are flat with mid cap issues outpacing senior and junior stocks. In Currencies the Euro remains weak off 10.3% so far in 2010. Wheat is leading global commodity markets soaring 28% this year while oil is off 6.4%.  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 p

August_11th_2010.mp3 Rangebound    Global equity markets down, global equity markets up; day to day it is hard to understand, are we gaining or losing?   Dow Jones Industrial Average (daily) (click for larger picture) Stock indices and most mutual funds have been poor performers over the last ten years. Ten years ago the Dow Jones Industrial average was 11,027.80. Today it is 10,466.10, 561.70 points lower, down 5% after 10 years. In 2010 we are off 791.91 points from the 2010 high, off 7% but up 851.78 points or up 8.9% from the 2010 low. Dow Jones Industrial Average (weekly) (click for larger picture) It is not uncommon to have range bound trade between the 200 week moving average currently 11,052.27 and the 200 day moving average of 10,436.43. It is important to realize that it is a market of stocks not a stock market, but even indexes can be analyzed using risk/reward.  There are many opportunities to make money but it requires action on your part, each stock s

August_4th_2010.mp3 Cementing an Idea    Where should you invest? Mutual Funds like stock indices have been poor performers over the last 10 years. Interest rates of 3% are not enticing. It takes some original thinking and realizing that it is a market of stocks not a stock market.   Cemex SAB de CV (click for larger picture) Summertime, cottages, camping and travel. While stuck in traffic with road construction and bridge repairs think about investing. The North American road infrastructure is crumbling; bridges need reinforcing highways need rebuilding. Governments are pouring money into employment programs to rebuild America. Other than employing people there are machines and materials being utilized at record levels. Think, look around; Cement, rebar, metals, earth moving machinery.  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 p

July_28th_2010.mp3 Risks of Rising Rates    Investors have been disappointed with the performance or lack of performance of their mutual funds. Equity markets despite volatility have not been friendly to the buy and hold mentality. Many investors are jumping out the frying pan and into the fire of rising interest rates.   Bank of Canada Interest Rates (click for larger picture) Frustrations from 10 years of underperformance have seen many investors lock in a fixed rate at near record lows. A Government of Canada 30 year bond yields 3.79% today. Historically through thousands of years it has been found the normal rate of interest is 7%. If we move to that level a 30 year Government of Canada bond will lose 40% of their principal value. In 1981 some will remember the Canadian prime rate reached 23% and fell as low as 2.25% and is currently 2.75%. Many conservative investors could find their savings tied up in bond funds in the wrong place at the wrong time as rates rise further.

July_21st_2010.mp3 Targeting Volatility    Is it time to differentiate yourself when investing? 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 levels as 10 years ago, the lost decade for investment returns.   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  well thought out risk/reward analysis.  There are many opportunities to make money but it requires action on your part, each stock selected must sh

July_14th_2010.mp3 Risk? Reward?    Two weeks ago we discussed avoiding the Thundering Herd of negative sentiment which brought equities down 17.1% using the S& P 500. In the last 7 trading days we have had consecutive up day with a 8.8% rally. Apple Inc. (click for larger picture) AT&T Inc (click for larger picture) A month ago (May 26th) we discussed a Fibonacci target of 1008.55 on the S&P 500 the actual low was 1010.91. The market had moved into a buy zone as discussed June 30th, using risk /reward analysis with a 3.35:1 ratio on the S&P. At current levels a tamer level of 1.35:1 risk/reward suggests a more aggressive buy tone below 1071 on the S&P and profit taking above 1154.  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-obligation consultation. Contact me by fil

June_30th_2010.mp3 Fear and the Thundering Herd!    Fear and the Thundering Herd; should you join the negative stampede or is it time to run against the masses? As we approach the end of the second quarter fear and bearish forecasts surround equity markets. It appears the second quarter will show a decline of 10.8% from the 1st quarter of 2010 using the bellwether S&P 500 Index and down 6.4% so far in 2010. However we are still up 13.5% from year ago levels. S&P 500 Index (click for larger picture) A month ago (May 26th) we discussed a Fibonacci target of 1008.55 on the S&P 500, although we have not reached that low yet, the recent low being 1035.18 we are now into a buy zone using risk /reward analysis with a 3.35:1 ratio on the S&P.  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 throu

June_23rd_2010.mp3 Opportunistic Moves    S&P/TSX Composite (click for larger picture) Let me provide you with a unique perspective on your investments through a no-obligation consultation. Contact me by filling out the "Unique Perspective" form on the Contact page, or by calling at 1-204-982-0633. Before trading, please contact an investment professional.  

June_16th_2010.mp3 Euro Peaks and Troughs    Euro-US Dollar(click for larger picture) Let me provide you with a unique perspective on your investments through a no-obligation consultation. Contact me by filling out the "Unique Perspective" form on the Contact page, or by calling at 1-204-982-0633. Before trading, please contact an investment professional.  

June_9th_2010.mp3 Fool's Gold    Gold (click for larger picture) Let me provide you with a unique perspective on your investments through a no-obligation consultation. Contact me by filling out the "Unique Perspective" form on the Contact page, or by calling at 1-204-982-0633. Before trading, please contact an investment professional.  

June_2nd_2010.mp3 Emotional Markets    Market Emotion Cycle (click for larger picture) Let me provide you with a unique perspective on your investments through a no-obligation consultation. Contact me by filling out the "Unique Perspective" form on the Contact page, or by calling at 1-204-982-0633. Before trading, please contact an investment professional.  

May_26th_2010.mp3 Approaching a Turn    S&P 500 Retracements (click for larger picture) Let me provide you with a unique perspective on your investments through a no-obligation consultation. Contact me by filling out the "Unique Perspective" form on the Contact page, or by calling at 1-204-982-0633. Before trading, please contact an investment professional.