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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An expert says the company could write off the billions it will spend to protect its reputation.
By Dan Freed, TheStreet
BP (BP) likely will be able to deduct payments it has agreed to make to compensate people damaged by the oil spill in the Gulf of Mexico, according to a tax expert.
BP last week agreed to establish a $20 billion escrow account to compensate victims of the spill. In determining whether the fund is tax-deductible, BP first must establish that it is an "ordinary and necessary" expense it incurs as part of conducting its business -- a hurdle it clears fairly easily, according to a report Monday from Robert Willens, a longtime Lehman Bros. tax expert who now heads his own consulting firm.
Willens cites a past case in which the Internal Revenue Service allowed a taxpayer to deduct a payment made to settle a lawsuit, since the act that gave rise to the lawsuit was part of the ordinary business activity of the taxpayer in question.
These well-known blue chips are still paying sweet dividends.
Great dividend stocks are easier to find than you think.
Income investors looking for safe dividend stocks in which to stash their retirement money are already familiar with many blue chips that have hefty yields. It's just that when investors stop at the grocery store or pay their phone bills, they aren't thinking about how the big brands they're doing business with are actually good income investments.
Here are three of America's best-known corporations with yields about twice what 10-year Treasurys pay. These low-risk blue chips are some of the most famous high-yield dividend stocks out there:
The best time to buy these shares is when they get hammered in a scripted retreat.
By Jim Cramer, TheStreet
Time for the patented rollover? Did we rally and rally until everything got taken up too high and too much money came in?
Sure looks like it. Just like that, the bid is gone underneath, we are worried about the euro, the Chinese are still regarded as cheaters, oil went too high and we are worried about a weak economy, punctuated by the spill in the Gulf.
It's as if the whole move upward was based on nothing but an easing of the crisis and the soft landing in China -- and now we are back in the range. I expect oil to slip back to $70, the euro to go back to $1.20 against the dollar and gold to go higher as a sign of craziness and destruction.
Until earnings are reported.
After months of reducing its holdings, the country has increased its investment.
China's decision to end a strict yuan-dollar peg is getting all the headlines -- even though the likely appreciation of the yuan versus the dollar is in the vicinity of 3% or so in 2010. That's hardly a game changer. (For more on why China made this move now, see this post.)
But the bigger China-U.S. news dates back a few days to June 15: After reducing its holdings of U.S. Treasury debt by 6.5% from November 2009 through February 2010, China reversed its policy.
In March and April, China increased its investment in U.S. government notes and bonds by 2.6% to $900.2 billion.
Shares of these hot energy picks go for less than a gallon of gas.
As a growth guy who focuses on sales and earnings, I have very strict guidelines as to how I screen penny stocks. Small stocks come with big risk, and there aren't always the concrete numbers I demand in these investments.
However, if you do your homework, you can often separate the poor penny stocks from the shiny picks that could deliver big profits overnight.
Here are three of my favorite penny stocks right now:
The market is fighting back now, but these stocks are doomed to fail in the months ahead.
After the stock market's antics in May, things appear to be on the mend in June, with the broader market trending upward -- especially thanks to a bullish start for this week as China moves to revalue its yuan.
But a rising tide does not lift all boats. Some stocks have been pushed down for a reason after the stock market's consolidation last month, and these picks need to be trimmed from your portfolio immediately.
Here are the three worst blue chips, according to my latest analysis of the market:
Signs of trouble emerge as equities enter a historically weak time of the year.
Risky assets bounced higher in overseas trading today after China finally acquiesced to global pressure and announced that it would once again allow its currency, the renminbi yuan, to start appreciating again. The Shanghai Composite jumped 2.9%, Japan's Nikkei index added 2.4%, and European stocks gained 1%.
But American traders are using the good news as cover to sell. As I write this, the smaller and riskier stocks in the Russell 2000 have dropped from a gain of 1.8% to trade with a deepening loss of 0.7%. The U.S. dollar is also moving higher and is trading with its largest gain since stocks bottomed on June 8.
With the major indexes overbought in the short term, and after a recent cross of significant technical resistance at the 200-day moving averages on the S&P 500 and Dow Jones Industrial Average, a pause for breath was to be expected. There is evidence, both historical and anecdotal, that stocks have further to fall.
Amazon cuts the price of the Kindle as competition mounts on the low and high ends of the e-reader market.
The e-book industry was shaken up Monday as Amazon(AMZN) and Barnes & Noble (BKS) made aggressive cuts to the prices of their book-reading devices.
First, Barnes & Noble cut its Nook reader to $199 from $259. That reader comes with 3G technology. The company also introduced a Nook that connects only through Wi-Fi for $149.
Think the banking bailout was bad? Check out the funds going to these two companies.
That's according to The New York Times, which had an excellent report Sunday on the sad state of Fannie and Freddie. The tab to take care of the companies is up to $146 billion, and the Congressional Budget Office predicts it could climb as high as $389 billion.
What happened here? Fannie and Freddie have been getting investors to fund mortgage loans for decades, promising to repay if borrowers defaulted, Binyamin Appelbaum writes. The companies used the money to buy loans already made by banks.
Is there a comparison between the actions of Tony Hayward and those of Nero?
My local paper had three front-page photos this weekend. The first showed chief executive Tony Hayward yachting. The second compared the environmental impact of the oil spill to the Dust Bowl disaster of the 1930s. And the third showed the massive fires in the Gulf burning off the oil. Flip in one page, and there was a picture of workers in jumpsuits with hand tools cleaning the beaches.
There's a reason stocks kept rising last week: China's revaluation of the yuan.
By Jim Cramer, TheStreet
The market knew something, all right. That persistent bid underneath that we all sensed, we all felt, turned out to be dead right.
I thought it might be because the euro was holding. Or because the Spanish banks had at last broken the backs of bearish investors. I thought it might be that employment is getting stronger -- or, more likely, has to get stronger -- because some companies, like General Motors, aren't doing their usual furloughs. I thought it might be the final financial regulation rules and how they wouldn't be that onerous.
I didn't think it would be China, because I already checked off the Chinese recovery box last week -- one of the key props I needed to see before we could leave the 2010 bear market behind.
The market's real smart.
With leading economic indicators and the stock market going up, I think this will be a great summer.
Value Line Index -- Approximately 1,700 stocks, so it is much broader than the S&P 500 or the very narrow Dow 30: Up for the week.
- The index was up 2.51% for the week
- The index is up 1.13% for the month
- The index has been up 3 weeks and down 2 weeks
- The index closed Friday above its 20- and 100-day moving average but below its 50 DMA
The latest attempt is more modest, and finally under way: "It's Steven and Stacey taking chances on projects they believe in"
It’s back, but just what is it this time?
That’s the essential question, as DreamWorks roars back to life after spending much of 2009 in the credit-market wilderness following its divorce from Paramount.
Now with over $800 million in privately procured financing in the bank and with the launch of six movies into production, the studio begins what can be termed its third life stage -- operating as a privately funded company with only one of the original Big Three founders, Steven Spielberg, still running the show.
Unshackled from their unhappy Paramount home, and beginning a more simple life as a pure-play movie-production house, DreamWorks officials brim with the kind of hope that can only be found at a studio that hasn’t been around long enough to see anything flop.
The summer rally is definitely a rally, but it's not going to be huge.
Question: Are you bullish or bearish?
Answer: It depends on what time period we're talking about.
In the very short term -- say, the next four to six weeks -- I'm bullish. I think the market is gradually inching its way higher after breaking through resistance at 1108 on the Standard & Poor's 500.
The summer rally could take us up another 30 or 40 points on the S&P 500 from here.
Luxury mattresses are becoming more popular, even as the economy teeters.
Sealy (ZZ) is making more mattresses for the luxury crowd, and just debuted the black-and-gold Golden Elegance king model for $4,999, The Wall Street Journal reports.
But that's nothing compared to the $44,000 "Sublime" mattress coming out later this year from California-based E.S. Kluft. It will likely become the most expensive American-made mattress, joining the ranks of other mattresses made with cashmere, mohair, silk and crimped wool, writes Anjali Athavaley.
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Like many companies this winter, the fast-food giant blamed a drop in same-store sales on the weather. But could its problems be bigger than a snowbank?
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[BRIEFING.COM] The major averages began the new trading week on a slightly lower note with small caps leading the weakness. The Russell 2000 shed 0.3% while the S&P 500 slipped less than a point with six sectors ending in the red.
Equity indices began the day in negative territory with only the Nasdaq (-0.04%) making a very brief appearance in the green. After sliding through the first hour of action, the major averages reversed and spent the remainder of the session climbing off ... More
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