The US isn't strong enough not to care about them now. But one day it will be, Jim Cramer says.
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Wall Street was given plenty of warning, and now the SEC may be looking into who knew what and when.
Unless it was all a huge coincidence, it's likely that someone in the know leaked the information. The questions are who and whether the leak led to early insider trading.
That's what the Securities and Exchange Commission is reportedly investigating. The SEC has asked Standard & Poor's to disclose who exactly knew about the downgrade before it was announced, the Financial Times reports. It's the start of a preliminary look into potential insider trading.
Apple and Amazon have held up well despite heavy market volatility. Favorable chart patterns make each a good buy on an upcoming pullback.
The yellow metal and companies that mine it remain in a bull market.
By Frank Byrt, TheStreet
Standard & Poor's is recommending gold and gold miners as top investment picks only days after downgrading U.S. Treasurys, which sparked a firestorm in financial markets worldwide that boosted the price of the precious metal.
S&P's Equity Research Services unit, which made the recommendation, is independent of the firm's Ratings Services division, which lowered its long-term credit rating on the U.S. to AA-plus from triple-A with a long-term negative outlook last week.
Gold futures tumbled Thursday after CME Group, the owner of the world's biggest futures market, increased margins on gold contracts by 22%. Gold had soared 8% in the previous three days, bringing a one-year gain to 49%, on U.S. and European debt concerns and a slowdown in global economic growth. Haven investments such as gold, Treasurys and the Swiss Franc have benefited the most.
"We believe that gold is in a bull market," S&P analyst Leo Larkin wrote in a research note, because demand will outstrip supply "for the foreseeable future."
Spooked by a severe market slump and the first downgrade of US credit, investors are on pace to redeem record amounts.
By Frank Byrt, TheStreet
The prediction, from analyst Kevin McDevitt at mutual fund tracker Morningstar, comes after July's $22.9 billion in outflows, the most since the peak of the credit crisis in October 2008, when investors pulled $28 billion from U.S. stock funds. "With August off to a very rocky start, this trend is sure to continue, with deeper outflows to come."
Investors have withdrawn a net $200 billion from U.S. stock mutual funds over the past five years. Total fund industry assets peaked at $4 trillion in late 2007, but the subsequent stock market crash a year later, the prolonged recession and last year's flash crash have contributed to skittish investor behavior that has resulted in outflows of about $500 billion since the peak, according to Morningstar.
Big upswings are good for 3 things: selling tech, selling banks and selling companies that receive most of their earnings from budget-strapped governments.
Principally because it made us forget how horrible Wednesday was. The last-hour buying that accompanies an up day (courtesy of the rebalancing of double and triple exchange-traded funds -- the machine buying) put whip cream on top of the bullish concoction.
And I hated it.
I hated it because it was a day when rumors didn't fly in Europe -- or at least they were temporarily muted by the shorting ban.
We need real resolutions to real problems.
First, we need to take off the table a possible recession, courtesy of governmental uncertainty here and in Europe and higher interest rates in emerging markets. Second, we have to see a substantive conclusion to the sovereign and bank debt problems in Europe.
Around the world, central banks are dragging out or canceling interest-rate increases. The effect, however, is unclear.
A few thoughts after a wild few days.
By Morgan Housel
After several days, a stock market plunge and a flurry of finger-pointing, we're still trying to figure out what Standard & Poor's downgrade of U.S. Treasurys really means. Here are four points to keep in mind.
1. It had no impact on Treasurys. The biggest risk of a Treasury downgrade was the possibility that interest rates would rise. That could add trillions to future federal borrowing costs and stifle economic growth.
But interest rates didn't rise at all after the downgrade. In fact, they've plunged. Monday turned out to be the eighth best day for 10-year Treasurys in modern history. The biggest irony of downgrading Treasurys is that it instantly increased global demand for . . . Treasurys. One blogger, mocking the stereotypical investor, quipped: "Treasurys were downgraded? Wow! Sell my entire stock portfolio and get me into Treasurys!"
Sales are suspended for repricing as gold soars.
These are the gold numismatic coins sold to collectors, not the gold bullion coins sold to investors, the Mint told Reuters.
The problem was that the market price for gold bullion was fast approaching the price of gold collector coins. The U.S. Mint has the right to stop collector sales when that happens, but that apparently has never happened, at least as far as anyone can remember.
As stocks flirt with losses of 20% or more, many observers are calling for the end of the March 2009 uptrend. Here's why they're wrong.
It's been a brutal few weeks. Stocks at home and abroad have been pummeled by the combination of fresh recession fears and financial panic. Instead of focusing on solid second-quarter earnings or a slowly improving jobs picture, all eyes were on sovereign debt concerns and the rising potential of two disaster scenarios: a default by the U.S. Treasury and a breakup of the eurozone.
As a result, a number of major stock averages have fallen more than the 20% technical guideline used to define new bear phases. The Russell 2000 Small Cap Index is down more than 22% from its high. The iShares Transportation (IYT) is down nearly 21%. Markets in Brazil, France, Germany, China and India have also crossed the 20% threshold.
Yet mindless terror is now giving way to a more reasoned analysis as stocks whipsaw near their lows. The surge of buying in U.S. Treasury bonds proves America still issues the reserve asset of choice and retains its haven status. And a big drop in Spanish and Italian bond yields shows that European policymakers are serious about ring-fencing their problems.
This is the bottoming process I've been waiting for. And it's a sign that the time to start buying up stocks at deeply discounted prices is nearly here. Here's why.
One enterprising designer is turning the convicted fraudster's old pants into pricey tablet covers.
And now what once covered Madoff's rear end can protect your iPad.
Introducing the Bernie Madoff collection at Frederick James, a designer that makes iPad covers from "rescued" and vintage fabrics. Frederick James won 16 pairs of Madoff's pants at an auction in 2010 and turned them into iPad covers selling for between $250 and $500 each.
For $350, you can get the Ralph Lauren Polo blue khaki pants cover.
Even after sharp recent declines, the chart patterns show that four of the most prominent global bank stocks still have more downside potential.
It's a good time to buy stocks at current depressed levels. Here's a start.
By Jamie Dlugosch, Stockpickr
In September 2008, I wrote that it was not too late to sell stocks. With the market in the middle of a sell-off, that article went against the grain of popular opinion. I was proud of the result. The S&P 500 ($INX) ultimately lost 39% between September 2008 and March 9, 2009, when the market hit its low.
I bring this to your attention as we attempt to deal with the current market environment. Should investors sell? Should investors buy? Should investors buy gold? These are legitimate questions, to which many people are desperately seeking answers.
Despite recent volatility, the Oracle has maintained his faith in the US economy and a long-term investment approach.
By Don Dion, TheStreet
The past week's gut-wrenchingly volatile market action has stoked fears into the hearts of even the most confident investors. One individual who appears solidly set in his bullish ways, however, is Warren Buffett.
On a number of occasions, I have commented on the Oracle of Omaha's unwavering optimistic view of the ongoing global economic recovery. Using a variety of mediums including New York Times op-eds, shareholder letters, and sit-down interviews, the billionaire investor has attempted to ease investor fears, arguing that the world's largest economy still holds promise over the long run.
As investors have clamored and panicked following Standard & Poor's' credit downgrade and renewed concerns over the European debt crisis, Buffett has once again taken to the stage in an effort to quell fears.
Orders miraculously pick up, giving the company and investors a sense that the worst of the tech spending slump might be over.
By Scott Moritz, TheStreet
The unexpected optimism sent Cisco shares up 15% in early trading Thursday, helping to lift the Nasdaq ($COMPX) almost 3% and boosting peers like Juniper (JNPR) and tech giants like Microsoft (MSFT), which were surging 7% and 3%, respectively. (Microsoft owns and publishes MSN Money.)
"The key takeaway is that things have likely stopped getting worse, even if the company is still facing competitive threats," Morgan Stanley analyst Ehud Gelblum wrote in a note Thursday, upgrading Cisco to a buy.
A portfolio of master limited partnerships that yields roughly 6% is there for the asking.
That's the only explanation that I can come up with for the incredible resurgence in master limited partnerships Wednesday. On a day when the Dow ($INDU) tanked more than 500 points, almost all were up, as witnessed by the moves in Enterprise Products Partners (EPD), Markwest Energy (MWE) and Energy Transfer Partners (ETP).
I don't care that I sound like a broken record about yield, but a portfolio of master limited partnerships that yields roughly 6% is there for the asking. These MLPs are amazing in their comebacks, as anyone who bought Linn Energy Limited Liability (LINE) the other day, catching a monster move, knows.
You just caught a four-point move from the $32 level simply focusing on yield, or focusing on insider buying, which is aggressive in LINE.
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Improving the US's internet infrastructure would be a costly undertaking, but government regulation could help boost connection speeds and competition.
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- Gold and silver futures climbed higher in late overnight/early morning trading sessions.
- Silver, however, has been pulling back from its $21.52 session high and is now +0.8% at $21.07/oz. Apr gold is +0.4% at $1346.90/oz.
- Crude oil was higher overnight and rose as high as $101.52/barrel. In more recent trade, the Apr contract has been selling off its session high and is now -0.3% at $100.84/barrel
- Apr natural gas is -0.5% at $4.63/MMBtu
- May ... More
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