7/6/2011 5:25 PM ET|
Market moves for the second half
Investing experts share their insights on how to make money now -- in the stock market, in bonds or in real estate.
How should you invest during the second half of 2011? It depends, of course, on who you are as well as on whom you ask.
Whatever else they do, investors should avoid letting daily headlines distract them from their investing strategies, said Jonathan Hoenig of Capitalistpig Asset Management and author of "Greed Is Good: The Capitalist Pig Guide to Investing."
"Investors do themselves a disservice by trying to analyze economic news, because it's always lagging," Hoenig said. "The market is the leading indicator."
Hoenig is among a half-dozen experts surveyed by TheStreet for their No. 1 tips to American investors in the year's second half. Here's a rundown of what each recommended.
Jim Cramer: Buy big exporters
With a weak U.S. jobs market providing economic headwinds, investors should be considering shares of companies with strong exports, said Jim Cramer, markets commentator for TheStreet and host of CNBC's "Mad Money."
"I expect that by September . . . China will no longer be actively trying to slow its economy down. That means GM can start selling many more cars," Cramer said. "It is a huge swing factor, and the base in the stock is showing you that's what's to come."
Other exporters favored by Cramer include engine maker Cummins (CMI, news), mining giant Freeport-McMoRan Copper & Gold (FCX, news) and earth-moving-equipment manufacturers Caterpillar (CAT, news) and Joy Global (JOYG, news).
Cramer also likes apparel makers, on the premise that the spectacular run-up in cotton prices has peaked. Again, he favors companies that do significant business internationally.
"My two favorites are Phillips-Van Heusen (PVH, news) -- because its Tommy Hilfiger and Calvin Klein brands are huge overseas, and it put through monster price hikes -- and the Jones Group (JNY, news)."
Jonathan Pond: Look for dividends
Dividend-paying stocks and mutual funds tend to fare better in dour markets, but there are ample reasons for investors to seek dividends if the bull market continues, said Jonathan Pond, a financial planner, author and host of the PBS program "Grow Your Money With Jonathan Pond."
The 15% tax rate on dividend income is one reason Pond favors dividends now.
"If you're interested in individual stocks, consider AGL Resources (AGL, news), which has a dividend yield of 4.3%; Johnson & Johnson (JNJ, news), which yields 3.4%; Procter & Gamble (PG, news), which has a 3.3% dividend yield; and Vodafone Group (VOD, news), which has a 5.3% dividend yield," Pond said.
"If you prefer to cast a wider net with exchange-traded funds, the pick of the litter is the Vanguard Dividend Appreciation ETF (VIG), which has a 1.9% dividend yield," he said. "If your preference is for an index fund, the Vanguard Dividend Appreciation (VDAIX) is a mirror image of the ETF."
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Fundamental change could turn America around. But, I doubt that anything else will. If we forced our public owned corporations to pay our minimum wages wherever they go, that would bring back jobs and show a little respect for workers. It would also help to have labor represented on corporate boards as Germany does.
If all government guaranteed loans were made directly for a low interest, home and student notes would be cut by half or more and trillions would be left in the hands of our people instead of thieving banks. Why should anyone pay a bank 600k for a 200k house when the tax payer backs the loan? Our capital gains tax where most giant money is made is only 15% and we give big banks with trillions in assets billions in 0% loans to play the market. Insane. unless you are a big banker or a wall street billionaire.
Is it written somewhere in blood that big corporations, banks and wall street should be helped to rape and destroy our country? Seems to me we are pursuing this insanity with a religious fervor.
Well, you know, among some of the less common accounts (not exactly in your typical high school textbook), was mention that FDR, who in actuality had at one time been a business partner for Hoover; was himself involved in front companies that helped profit off of the hyper-inflation from 1920s Germany. Some people certainly are adept at profiting of the hardships of others....
TBH, rather then all the focus on making the quick buck in the face of trajedy, I wish some would focus more on creating the future, and creating the better outlook, rather then trying to convince people by mere psychology that things are better then they are, or out finding a way to profit off misery. There certainly would be areas where the future could be helped by being created today, and of course the resourceful and innovative one's who do; well we've certainly seen a certain history in that regard. There is a reason of course, that the 20th century showed the growth it had, and it wasn't from people burying their heads in the sand and playing make believe, nor was it from everyone just passively sitting by waiting for things to get better.
Ultimately, if we want a better world, better economic prospects, or the like, it's not going to come about unless it's created. And simply speculating on the stock market, or pouring funny money into the brokerage firms (aka fiat currency printed with wild abandon) isn't going to bring about that sortof growth. The American "can-do" spirit, combined with a certain degree of euntepenurship on the part of many, had a lot more to do with some of the growth, and gains in the past; which in the face of this deep recssion, labor seems to be losing/having turned back at a rapid pace, then speculating on Wall Street or trading in the banking houses had. In those days, going back 50 years ago, 100 years ago, when the little people saw a need, they stepped in to fill it. They didn't see a job, they made a job; though of course they didn't have all the beuracratic red tape many people face today, in say Jersey for instance.
I don't think we can count on the fat cats to bail us out of this one, no matter how much they want the tax payer to bail them out of their own mistakes. We're going to have to bail ourselves out, not rely on the world bankers to do it for us, it seems....
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