Once you get past the hype, there's little chance for long-term gain with this stock.
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Facing a higher tax rate in Obama's jobs bill, hedge fund managers are contributing more to GOP candidates. The move might be their most profitable bet this year.
By Robert Holmes, TheStreet
In a year of disappointing stock returns, it turns out that hedge funds' best investment may be in Republican presidential candidates.
The details of President Barack Obama's $447 billion jobs bill emerged Monday, and it was revealed that investment managers' gains would be taxed at the income tax level. The tax rate on carried interest income -- the profits investment managers are paid as compensation -- is currently 15%, below the income rate of 35%.
Obama's decision to take aim at the carried interest tax break is a direct hit at hedge funds and echoes calls made by billionaire investor Warren Buffett in his New York Times op-ed asking regulators to stop coddling the superrich. In the commentary, Buffett noted that he paid only 17% of his taxable income, a lower rate than even his secretary pays.
Many analysts expect metals to rise on continued stock weakness, but chart and volume patterns indicate they might be due for a decline of their own.
By Tom Aspray, MoneyShow.com
Since the July 7 closing high in the S&P 500 at 1353, weakness in the stock market has correlated to strength in gold prices. The December Comex gold futures contract is up 18.4% during this period, while the S&P is down 14.1%.
Tuesday’s early weakness in the stock market was met with some surprising strength into the close as the September E-mini S&P 500 futures closed 34 points above the day’s lows. This surely gave the bulls some hope and made those who were short quite nervous.
Overnight in Europe, stocks were lower on concerns over the health of European banks, but so far, the futures are holding up well. These banks have looked weak for some time, and the RS analysis on several suggested in August that the global banks could fall further.
So if stocks drop back to the August lows, does it mean that gold is going to rise another $50 or $100? It is always possible, but for the first time since early in the year, the volume analysis is showing signs of weakness, which points to a correction, not a further rally.
Expectations have finally fallen too low for the high-performance chip-maker.
First, the maker of high-performance, high-speed semiconductors for pretty much everything save Apple (AAPL) is on a major roll. It has won contract after contact and is, without a doubt, shining in an era when gaming has simply been one of the great secular growth stories.
Nvidia's chips are the graphics behind the bold, lifelike characters you see at the introduction to all of the football games, the electronics in cars and the lifelike players in games like Call of Duty. Intel's (INTC) chips just aren't fast enough. Only Nvidia can get it done. And when Intel tries to be in fast graphical user interface chips, it licenses them from Nvidia. There's no earnings risk.
The CEO, Jen-Hsun Huang, came out last week at a tech conference and raised numbers and then said that the new estimate is conservative, in part because the Chinese business is so, so strong. (People ask for custom-made PCs there, and because gaming is so strong in China, a preponderance of people want Nvidia's chips in their boxes.)
The US is too deficit-focused to stop the bleeding as China gains ground in alternative energy and other industries.
By Tom Taulli, InvestorPlace.com
About a year ago, President Barack Obama toured Solyndra, a top manufacturer of solar photovoltaic (PV) systems. It was a centerpiece of clean tech and how it would reinvigorate jobs. As a sign of importance of the company, the Department of Energy provided a $535 million loan guarantee.
Unfortunately, it has turned out to be a disaster. This month, Solyndra filed for bankruptcy, shut down its manufacturing facility and terminated about 1,100 employees. There are also concerns about fraud and book-cooking at the company.
Allegations of impropriety aside, Solyndra has a lot to say about the state of the U.S. alternative energy scene. It looks like China has been even more aggressive with its alternative energy investments -- and if America isn't careful, it could force us out of the green energy biz altogether.
The latest attack on banks sounds reasonable but makes no sense.
The housing crisis has defied both expectations and easy solutions, making a mockery of optimistic forecasts for years now. Yet the latest news on the housing front shows how little attention the federal government and big banks are paying to the real problem behind the crisis: depressed home prices that have paralyzed homeowners and lenders alike.
An unnecessary distraction
Last week, the Federal Housing Finance Agency sued 17 banks, alleging that they sold almost $200 billion in high-risk mortgage loans to Fannie Mae and Freddie Mac without full disclosure. With $57.4 billion in bonds at issue, Bank of America (BAC) faces the biggest potential liability, while JPMorgan Chase (JPM) has $33 billion in loans under review.
There's no denying that banks deserve some of the blame for bad loans. Controversies like the robo-signing scandal and other improper documentation for mortgages highlight just how messed up bank procedures were during the housing boom.
Even stocks with good fundamentals are getting hurt as investors turn against the European banking sector.
Companies are choosing to make products for the highest and lowest income levels -- not the gray area in between.
The middle class? History. The housing market bust and the high unemployment rate have taken a huge toll on what was once a steady middle class (families with annual incomes of between $50,000 and $140,000).
Now, companies are changing their focus to cater to the rich and the poor -- but not that crumbling area in between.
Over the past 5 years, these funds have returned 3% annually as the S&P 500 has dipped into the red.
By Stan Luxenberg, TheStreet
Struggling to protect their assets, investors have been turning to world allocation funds. The funds have the flexibility to dodge trouble spots and invest in promising stocks and bonds around the world.
During the past year, investors have poured $24 billion into world allocation funds, according to Morningstar. That was a striking showing at a time when many stock funds suffered big outflows. Steady performance has been attracting the inflows. During the past five years, world allocation funds returned 3% annually, while the S&P 500 ($INX) dipped into the red.
Some of the most popular world allocation funds make sudden tactical moves, emphasizing emerging markets one year and U.S. bonds the next. But many funds in the category shift only slowly. The aim is to deliver steady results and not necessarily call every market move.
Ted Weschler favors consumer-discretionary, financial and telecom companies that generate lots of cash.
By Robert Holmes, TheStreet
Berkshire Hathaway said Monday that Ted Weschler will join the company early in 2012 after he winds down his Peninsula Capital Advisors hedge fund. Weschler and Todd Combs, who was added to Berkshire last year, will each manage a portion of the equity portfolios of Berkshire's insurance subsidiaries.
"With Todd and Ted on board, Berkshire is well-positioned for successor investment management at the time Mr. Buffett is no longer CEO," Berkshire said in a statement Monday.
Risk is elevated on 4 Nasdaq leaders, but all are strong outperformers that could lead the market's next rally.
The technology sector, as represented by the Nasdaq 100 and the PowerShares QQQ Trust (QQQ), is acting much better than the S&P 500 and the Dow Jones Industrial Average. Tech stocks have rebounded further from the August lows and may be able to hold those August lows while the other major averages break to new lows.
A fund manager who successfully bid for a pair of private dinners with the Oracle will now work at Berkshire Hathaway.
That's what happened to Ted Weschler, 50, who was the managing partner at the Peninsula Capital Advisors hedge fund.
For two years in a row, Weschler has been the anonymous bidder who won a private dinner with Buffett.
Here are some exchange-traded funds that offer opportunities, and a few that have been struggling.
By Don Dion, TheStreet
Here are five ETFs to watch this week.
This South Africa ETF has staged an impressive comeback after struggling in August, and it's once again trading around pre-sell-off levels. The fund's multi-week ascension bodes well for its momentum positioning. EZA has witnessed a climb across both our short- and long-term rankings.
Sweeping macro concerns facing the developed world could prove to be a hurdle for emerging nations like South Africa. Nevertheless, EZA may be exciting to watch in the days ahead.
The biggest wealth builders in the months ahead will be solid brands that deliver big revenues to shareholders.
By Louis Navellier, InvestorPlace.com
August was agonizing, to say the least. The volatility-laden indexes have scared the heck out of investors, and now everyone is asking the same question: What am I supposed to buy now?
Well, one option is to follow Warren Buffett into banking stocks. Buffett -- via Berkshire Hathaway (BRK.A) -- just plunked down $5 billion for a stake in Bank of America (BAC), which immediately prompted investors to start looking at the industry.
I have respect for Buffett, but you shouldn't follow in his exact footsteps on this one. Buffett got a special preferred-stock deal on Bank of America that other investors can’t get, boasting a great 6% dividend. You're better off picking other stocks than B of A -- but keeping the Oracle of Omaha's focus on plump dividend yields.
Prices slide as ugly headlines drag world markets lower, prompting investors to sell the metal to cover losses elsewhere.
By Alix Steel, TheStreet
Updated at 4:45 p.m. ET
Gold (-GC) for December delivery dropped $46.20 to settle at $1,813.30 an ounce at the Comex division of the New York Mercantile Exchange. Gold traded as high as $1,865.20 before dipping as low as $1,811.10, while the spot gold price was shedding $48.30, according to Kitco's gold index.
Wild headlines have had investors buying gold as a safety hedge but also selling the metal to cover losses elsewhere as global markets tanked. And there were a plethora of bad headlines Monday.
Let's get this over with soon so we can see what things look like when the smoke clears.
At least it is no longer complicated. We know a European Lehman is upon us. Or, more like it, a European Lehman-Bear-Merrill-Washington Mutual-Wachovia-Citigroup.
That's the first proposition.
Second, we know that "they" have no plan to deal with it.
Third, we don't even know who "they" are anymore. Is it the Germans? The French? The IMF? The European Central Bank? Trichet?
Fourth, it is now too late for the banks to raise capital. As you recall, when the ratings agencies strike, it very quickly leads to Lehman. The banks can't get short-term funding, and they collapse.
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The Fed may start tapering in just a few months. Here are a few of the likely winners and losers.
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[BRIEFING.COM] A solid November employment report translated into a solid day of gains for the major averages. While there was some talk that the encouraging job growth raised the odds of the Fed announcing a tapering at its December meeting, the message of the markets today was either that it didn't believe there would be a tapering this month or that it doesn't fear a tapering this month.
It was just one day, yet there was ample meaning wrapped up in the connection that the 10-yr ... More
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