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The Taipan Group�s 247profits e-Dispatch Baltimore, New York, Chicago, Berlin, Bonn, London and Paris October 15-18, 2004
***Stock Market Reality� yes, there is money to be made! ***Is it time to buy into all the �bad news,� buy gold, a shovel and a crate of canned beans and prepare for financial Armageddon once again? We big to differ�
Current economic, political and security factors are forming a turbulent market climate that will bring masses of unprepared investors to their knees. But a select few inventors who see it coming - and act accordingly - will prosper. You can be one of them. Learn more. ***********************************************
Yes, I already said this yesterday, but I think it bears repeating: There are people who tell me that there�s no money to be made in this market. After all, everybody knows that oil�s up, real estate�s soaring and the US dollar keeps dragging against euro, yen, and gold. Accordingly, everybody is looking at the sideways market of 2004 with a degree of distrust and frustration, if not resignation. And when the Dow dips below 10,000 - as it did on October 13 and 14 - those of the perma-bearish persuasion are convinced that the stage is set for the next grand market collapse. After all, that�s what everybody knows.
Just take two of our recommendations from the October issue of Taipan: Ian Cooper recommended you buy Aastrom Biosciences (ASTM:NASDAQ) and StemCells (STEM:NASDAQ) as plays on speculative moves surrounding the US presidential polls. Our editors recorded an entry date of October 1 for both positions. Not even two weeks later, on October 13, Ian recommended you sell half of your position in our Taipan Hotline� generating 34% gains on ASTM and 20% gains on STEM in just 12 days. (If you missed the Hotline sell recommendation, don�t worry� Ian thinks there�s plenty of hype going around to provide an even better exit point. We�ll alert you to his sell signal here in the daily 247profits e-Dispatch and on the Taipan website!) And here�s a message I received from Briton Ryle today regarding his Money-Flow Matrix Trader: �They say September and October are the worst for stocks. Now, I don�t know exactly who �they� are, but I can tell you this - �they� haven�t been trading my Money-Flow Matrix Trader recommendations for the last month and a half. �I�ve closed 15 trades since September 1. Eleven of them have been winners. But even better is the 37.8% gain those 15 trades have averaged. If you�d put as little as US$2000 on each trade, you�d be sitting on US$11,100 in profits in six weeks. Not bad at all. �I�ve hit Chiron for 189% and 50%, Novellus for 139%, QLogic for 71%, KLA-Tencor for 48% and Sandisk for 46%. �And there are still ten more trading days in October!� So - with everbody but our traders not making money - what is going on with the markets? Is it time to buy into all the �bad news,� buy gold, a shovel and a crate of canned beans and prepare for financial Armageddon once again? We beg to differ. Chances are that we are currently witnessing something that, six months from now, may appear as the final great buying opportunity of the decade. Because we believe we have now reached the formative phase of a fast and furious upward move in the equity markets that could double if not triple the valuations of almost all major equity indices by 2009. In his book The Next Great Bubble Boom (2004), Harry S. Dent Jr. puts some analytical meat on our bullish sentiment. Dent compares 2004�s flatliner market to the 1994 dead phase before the bull market from 1995 to 1999. Driven again by technology, especially by the final push in market penetration of Internet-related technologies (currently only 61.9% of US households have Internet access� a number set to reach 90% by 2008), we expect the markets� upward momentum to accelerate due to strong corporate earnings, increasing productivity and burgeoning business capital spending taking place in an economic environment characterized by continued stagnation of borrowing costs and incremental inflation.
Given the density of negative news in the mainstream media, shouldn�t we be tempted to disregard Dent�s prognosis as just another pie-in-the-sky projection? Sure, macroeconomic numbers can make you skeptical. There�s the Federal budget deficit� the record-setting US trade gap� the decade-long lows of the US dollar against almost any other major world currency. And then, of course, there are the argumentative centerpieces of the presidential race: unemployment, debt, and taxes. But how do these numbers hold up when you adjust your perspective to include past economic cycles� and past political biases? A study released today by the Free Market Project, entitled �One Economy, Two Spins,� analyzes coverage of unemployment reports from May through September in 1996 and 2004 on ABC, NBC and CBS evening news broadcasts, the primary evening newscast on CNN and news articles in the Washington Post and the New York Times. They arrived at an interesting conclusion: �While both presidents could take credit for creating more jobs and lowering the unemployment rate, there were four times as many as favorable Clinton stories as there were for Bush.� The report indicates that the media have consistently defined the economy in terms of the weaker payroll survey numbers� criticizing the Bush Administration�s 13 straight months of positive job creation, more than 1.5 million new jobs in 2004 and an unemployment rate that dropped from 6.3% to 5.4%. By comparison, eight years ago, the media regularly hailed the Clinton Administration�s record of just seven straight months of positive job creation, more than 2 million jobs in 1996, and an unemployment rate that dropped from 5.8% to 5.2%.
US job creation did indeed continue at a steady clip with the Labor Department�s announcement that 96,000 non-farm payrolls were added to the economy in September. That means that over the past thirteen months, 1.9 million new jobs have been created, reducing the US unemployment rate to a historically low 5.4%. 140 million Americans are now working - a new US record. (For comparison, Germany�s unemployment rate actually increased again in September� to over 10.4%!) During the ten quarters since the end of the technical recession in 2001, real GDP growth (adjusted for inflation) has averaged 3.4%, well in line with annual growth averages of the past six decades. Over the past four quarters, real economic growth has increased to 4.8% thanks mainly to the supply-side tax cuts. Personal income, too, has been growing at a 5% clip over last year. Real income is up 2.6%, and total compensation (including wages, salaries, non-cash and non-taxable benefits) has grown an inflation-adjusted 3.9% We believe that once the dust has settled in the aftermath of the presidential election, a clearer and less partisan assessment of the actual state of the US economy will emerge. Our team� first and foremost the analytical and charting department headed by WaveStrength oracle Adam Lass� will be putting our theories through rigorous testing. The results of their analyis will form the basis of the upcoming 2005 Taipan Forecast issue, which we will be posting on www.taipanonline.com in the second half of December.
The EVS �Taser-style profits� play has already made EVS members stellar gains. �Ian,
I bought [this stock] at $2.88, sold about a day later for 22% profit. Next
day, I bought back in at $3.96 - 500 shares. Next day, I bought 400 more shares
at $4.57. Then yesterday, I bought 180 more shares at around $6.00. My GOD,
it went as high as $6.70 yesterday! I like the logic and speculation involved
with your picks�� Get in on their next play before October 20 in this EVS exclusive report. Learn more.
Today�s tradesports.com standings for the 2004 Presidential Election are: PRESIDENT.GWBUSH2004: 54.0/54.9 (yesterday�s standing: 55.7/56.4)
3M Co., AMC Entertainment Inc., American Standard Inc., Arrow Financial Corp., Barnes Group Inc., BlackRock Inc., Cell Therapeutics Inc., CheckFree Corp., CNF Inc., CV Therapeutics Inc., Delphi Corp., E*Trade Financial Corp., eCollege.com, Flamel Technologies Inc., Hasbro Inc., Interstate Bakeries Corp., Kana Software Inc., Kraft Food Inc., Lexmark Holding Inc., Mattel Inc., Orbital Sciences Corp., Penn National Gaming, Plug Power Inc., Riggs National Corp., Shaw Communications Inc., Steel Dynamics Inc., Texas Instruments Inc., Three-Five Systems Inc., Tootsie Roll Industries Inc., Tupperware Corp., USA Truck Inc., W Holding Co., and Zhone Technologies are some of the companies releasing earnings. Brought to you by your free daily �WaveStrength Market Report� e-newsletter. You can sign up for your copy here.
��You Europeans have a funny way of complaining. This is like saying �You Americans
did create a lot of jobs. But they are lousy jobs. We Europeans didn�t create
any jobs, but if we had, they would have been good jobs.��
*** �For tomorrow, the indicators foreshadow further losses of 0.5% to 1%, depressing the index below the 13,000 mark for most of the day.� Hitting a low of 13,012.84 in the morning, the Hang Seng managed to defy our prediction, closing at 13,059.43, up 24.05 points (0.18%). Still, our indicators maintain their pronounced downward bias at minus 0.8% for Monday.
With a daily low at 10,913.21, the Nikkei 225 by and large complied with our prediction, finishing the day at 10,982.95, down another 51.34 points (0.47%). According to our indicators, there�s another 50 to 10 points to be squeezed out of the index by the middle of next week.
This just in from Taipan�s resident Editor-at-Large, Martin Denholm: ***European �Chop-Mission�: Well, I guess it was only a matter of time before the European Commission was forced to chop its economic growth forecast for 2005. Already ultra-reliant on exports for the bulk of the region�s growth, and with domestic consumer spending almost nonexistent, Europe is finding that the current state of the oil market (crude prices up an incredible 68% so far this year) has added to the mess. Result? The EC has now tossed out a 2.1% forecast for next year - revised down from the 2.3% GDP growth it boldly forecast back in April. This will swiftly be followed by 2.2% GDP growth in 2006 (allegedly!). It looks like Europeans are going to have to keep searching for crumbs of good news from their mediocre economy for the foreseeable future. 2004 will make 13 out of the last 14 years that European economic growth has lagged the US - more evidence to suggest Europe has an economic parity problem. It also heaps more pressure on the region�s bigwigs, namely �Old Europe�s� Schr�der and Chirac as well as British PM Tony Blair, to do something about it. Exactly what that might be, well, I don�t even think they know, never mind me! In the meantime, Germany, France, Italy and Portugal continue to struggle to keep their budget deficits in line with the ridiculous EU Growth and Stability Pact� with the threat of a slap on the wrist if they don�t! How embarrassing.
While the White House will probably claim some kind of satisfaction in the figures, some skeptics contend that the administration exaggerated earlier forecasts to make the final figure seem good in comparison. Whatever way you slice it, it�s still pretty darn bloated!
Tokyo Shoko Research reports that corporate bankruptcies dropped by 10% in September compared with a year earlier - the 25th straight monthly fall. Better yet, those currently in bankruptcy now owe 464.4 billion yen (US$4.2 billion) - a lofty figure, but an impressive 57% less that September 2003. Those in position to spend are also prepared to do so. The Bank of Japan reports that Japanese manufacturers plan to boost fourth-quarter capital spending by the most since 1989. OK, I�m out of here for this week. If that bunch of Beantown teasers known as the Boston Red Sox can find it within themselves to pick up the pace this weekend in their playoff series against the New York Yankees, I�ll have a good weekend. You do the same. Ciao.
***Urgent Oil Wars Stock Report: Find Out What Stock to Own Now! The greatest financial attack on US investors is underway... Do nothing and you�ll lose everything! Or prepare now and make 850% by next year.
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Copyright © 2004 by Taipan Group LLC. All rights reserved. The Taipan Group's 247profits e-Dispatch is sent daily to a select group of investors who share the courage and foresight to stay ahead of today's markets. The Taipan Group unites the stock-picking talents of several analysts and editors. We publish a variety of monthly print newsletters, weekly and daily trading alerts, and information services. Each of the services is based on individual trading/investment philosophies or vehicles and specific investment approaches. Please note: It's not our intention to send email to anyone who doesn't want it. If you would like to remove yourself from this mailing list, please see the instructions at the bottom of this message. For more about us, and a summary of our editorial policy, please read here and here. Our Members Only service frequently referred to in the e-Dispatch includes a subscription to TAIPAN, the monthly communiqué compiled by our Taipan Think Tank, as well as special reports, rebates on conferences, and related information services. For more information on how to enjoy full Membership Privileges, please visit our home page. The Taipan Group's 247profits e-Dispatch is intended specifically for mature investors with a strong sense of individual responsibility who want to arbitrage different viewpoints to optimize their personal investment strategy. We reserve the right to remove readers we believe do not meet these criteria from our distribution list without prior notice. You are welcome to distribute this message, at your discretion, to others who you believe share the values of the Taipan Group. NOTE TO OUR READERS: Taipan Group LLC or The Taipan Group's 247profits e-Dispatch does not act as an investment advisor or advocate the purchase or sale of any security or investment. Investments recommended in this publication should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company in question. Taipan Group LLC expressly forbids
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Title: Stock Market Reality
