Consumer Protection

Mon, 2017/02/06 - 2:47pm | Your editor

The gold price rise defies the Casablanca solution: “round up the usual suspects.” Adrian Ash, head of research at bullionvault.com writes that in 2016 the price of gold rose despite the following facts: “a 3-decade low in world jewellery demand”; a 7-year low in demand for gold coins and small bars; a 6-year low in central bank demand, which fell by a third from the 2000-2010 level; and industrial and dental demand down 3% to a new world low at under 7.5% of total gold use.

Adrian concludes that “if it's not jewellery, not coins, not small bars, not central banks, not industrial users that just leaves bigger investors, trading in and out with money which would otherwise go into stocks, bond, commercial real estate and the rest.” In fact the big money was going into exchange-traded gold funds in 2016 after big money exited in 2013, 2014, and 2015. That meant the largest mostly Western investors in gold bought net about 643 tonnes for settlement in London, where Adrian hangs out.

This reversal, in my opinion, will continue as people worry about trade and protectionism this year and because big users of gold as a haven—in India and China—will sneak out of yuan or rupees to get their hands on their favorite bolt hole after measures to stop foreign investment and currency recall respecitively.

While Adrian is the expert, my personal view is that political uncertainty in the US is also leading to more gold buying as Pres. Trump flails about trying to impose immigration bans.

 

Today I got a disappointing news release from Bristol Myers Squibb, a US drug firm whose shares I own. It said that phase 2 trial of Innate Pharma’s lirilumab in elderly patients with acute myeloid leukemia failed its primary endpoint. The BMS-partnered checkpoint inhibitor failed to improve leukemia-free survival by more than placebo. Innate had enrolled 150 oldsters for the trial and randomized them to receive one of two doses of the anti-KIR monoclonal antibody or a placebo. The clinical trial failed to find a statistically significant difference between either treatment arm and the placebo in leukemia-free survival or any other efficacy endpoint. The across-the-board failure is a stumble at the first major clinical efficacy hurdle faced by lirilumab.

Pres. Trump's plan to speed up US Food & Drug Administration approvals of new drugs by testing them only for safety but not for efficacy would eliminate such bad news. But as consumer I would prefer to have the FDA stop drug companies selling drugs which don't work, even if I am a shareholder in the pharma firm, as with BMY.

Regulations exist for a reason. Dismantling the Dodd-Frank Act and stopping the implementation of the US Dept of Labor's fiduciary standard for retirement investment advisors are similarly dangerous, in my view. The 2008 global financial crisis happened because of excessive deregulation. The DoL rule, due to come into force in May, stops financial advisors from putting retirement savings customers into inappropriate holdings which pay the brokers higher commissions.

In finance just as in pharmaceuticals, a free market doesn't work without brakes, because the buyer lacks information on how good the proposed investment will be..

Just trusting the broker or the drug-maker is not the right way to get help, based on past experience. While Pres. Trump also called for lower prices for drugs and more pharma jobs in the US, he thought he was balancing these demands with less regulation popular with the industry.

 

Today we pick another Trump stock and report on news from Finland, Russia, the Philippines, Israel, Britain, Spain, Mexico, Brazil, China, and a few other places.

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Tables Posted

Sun, 2017/02/05 - 3:14pm | Your editor

I have just posted the Sunday tables for www.global-investing.com which include our first 2017 trades. Unfortunately my browser is down so you may not get this message on Sunday.

talkmarkets-2

Sun, 2017/02/05 - 11:28am | Your editor

Your editor got an extraordinary offer from a UK website, a chance to win an award as a top quality newsletter by paying a mere £4000 for the “honour”. Global-Investing.com does land a few real kudos, most recently from The Investor's Digest of Canada (a publication of MPL Communications of Toronto) and Wall Streets Best Income Stocks (a blog from Cabot Corp. of Massachusetts). Both came as a result ofour stock picks doing well in 2016. We do not pay for praise. The best praise of all comes from happy subscribers whose letters are posted under “kudos” on the www.global-investing.com website. My newsletter is a hobby for me and I just closed the accounts for 2016 showing that my company lost a small amount of money last year. I wouldn't go on but for the fact that I make money with my stock picking, alongside my readers. Without them I would not have the access I need to get analysts and companies to talk to me.

 

Today we had good macro-economic news in the US and Europe. US unemployment fell to 246 mn, nicely below forecasts. Non-agricultural production beat forecasts rising by 1.3% in Q4. These numbers came before Donald Trump did anything. In Europe producer prices rose 0.7% in Dec, higher than expected.

 

And the European Commssion set new sanctions on Iran for its missile test last week—under the terms of the treaty which the US now threatens to tear up. We have a company which reported after the close yesterday and news from the Dutch Antilles, Canada, Brazil, Argentina, Chile, Mexico, Bermuda, Finland, Britain, Germany, Japan, India, and a few other places around the world. Readers may have noticed that of late I am writing more about daily stock price movements. This results from a different presentation at E-trade, my brokerage, about which I am not altogether pleased. While it wants to generate lots of day-trading which pays off for your broker, we are really buy and hold types.

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How To Win Prizes

Fri, 2017/02/03 - 2:18pm | Your editor

Your editor got an extraordinary offer from a UK website, a chance to win an award as a top quality newsletter by paying a mere £4000 for the “honour”. Global-Investing.com does land a few real kudos, most recently from The Investor's Digest of Canada (a publication of MPL Communications of Toronto.) and Wall Streets Best Income Stocks (a blog from Cabot Corp. of Massachusetts). Both cames as a result of stock picks doing well in 2016. We do not pay for praise. The best praise of all comes from our happy subscribers whose letters are posted under “kudos” on the www.global-investing.com website. My newsletter is a hobby for me and I just closed the accounts for 2016 showing that my company lost a small amount of money last year. I wouldn't go on but for the fact that I make a lot of money with my stock picking, alongside my readers. Without them I would not have the access I need to get analysts and companies to talk to me.

 

Today we had good macro-economic news in the US and Europe. US unemployment fell to 246 mn, below forecasts. Non-agricultural production beat forecasts rising by 1.3% in Q4. These numbers came before Mr Trump did anything. In Europe producer prices rose 0.7% in Dec, higher than expected.

 

And the European Commssion set new sanctions on Iran for its missile test last week—under the terms of the treaty which the US now threatens to tear up. We have a company which reported after the close yesterday and news from the Dutch Antilles, Canada, Brazil, Argentina, Chile, Mexico, Bermuda, Finland, Britain, Germany, Japan, India, and a few other places around the world. Readers may have noticed that of late I am writing more about daily stock price movements. This results from a different presentation at E-trade, my brokerage, about which I am not altogether pleased. While it wants to generate lots of day-trading which pays off for your broker, we are really buy and hold types.

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Trading alert

Thu, 2017/02/02 - 5:59pm | Your editor

Only paid subscribers get trading alerts. More for them below. Become a full subscribers to get information on buys and sells.

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Busy Thursday

Thu, 2017/02/02 - 1:01pm | Your editor

The good news today is that Ms de Vos, partisan of for-profit schools and demagogue against public ones, is the likeliest Trump cabinet nominee to face a negative vote over her becoming Secretary of Education. She is the worst billionaire among a bad lot.

 

Today we will not get into US politics any further because there is much news to report and several stock picks and pans to write about. It is one of those busy Thursdays.

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Doomsday Clock

Wed, 2017/02/01 - 3:44pm | Your editor

The world is moving closer to a nuclear disaster according to the Doomsday clock, which moved a half minute closer to midnight last month, to 2 ½ minutes before disaster. That is partly the result of the new White House denial of global warming and the free and easy way the Potus talks about using and adding to our nuclear arsenal.

Naming Texas Gov. Rick Perry to head the Energy Dept. which overseas the US bomg program. Putin is also rattling on about more strategic nuclear weapons.

The Bulletin of the Atomic Scientists began tallying the danger of nuclear war in 1947 and it hasn't been this close to doom since the peak of the Cold War in 1953

Making matters worse is that a rogue state, North Korea, is testing ICBM weapons which can carry a nuclear warhead—so far unsuccessfully. Another rogue state with nuclear ambition, Iran, tested a ballistic missile Sunday which it claims doesn't fall under the 5-power treaty which Pres. Trump wants to renegotiate or tear up. While Iran has stopped producing weapons-grade plutonium under the treaty, it may nonethless have violated its terms against “destabilizing regional activities. During his campaign, Pres. Trump supported Israeli PM Benjamin Netanyahu's call for renewed sanctions against Iran.

When your editor was in elementary school in Manhattan, we children used to have atom bomb drills. We would put our heads on our desks and wrap our arms abound them. Cellars in my neighborhood had yellow and black signs showing where fallout shelters were to be found. Is this stuff coming back? More on nuclear below.

It appears that at least some of the problems of my newsletter's distribution were the result not only of problems with my webhost but also of problems with my cable company, which changed the settings on my account when it changed from being Time-Warner to becoing Spectrum. My conviction that nuclear technology is not being controlled is enhanced by these snafus.

More for paid subscribers follows from around the world.

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Week Two

Tue, 2017/01/31 - 1:30pm | Your editor

Week 2 of the Trump Administration saw a generalized stock market sell-off, globally, as the world realized that the White House is in over its over-combed head. My Monday blog did not go out because of alleged technical difficulties at our web hosts in Salt Lake City. Was there censorship at work? The Webmaster advises not doing anything unless it happens again. So here is a twofer.

How Trump can be trumped, via my proposed Constitutional mechanism, may not succeed without moderate Republicans. Congress should take the initialtive in legistlating for the USA, with members from both sides of the aisle calling hearings and listening to experts from the executive arm to generate new laws in areas which need reform: taxation, tariffs, immigration, energy regulation, foreign relations, healthcare, Guantanamo, torture, retirement, the Supremes and the judiciary, intelligence, and other areas where the White House should not be making policy without knowing how.

The main reason the Republicans in Congress aren't doing this is fear of Tea Party and Trumpist primary opponents next year because they are from districts which back Republicans and voted for Pres. Trump.

 

Information on how Russia is intervening against Angela Merkel on behalf of AfD is enlightening. The Kremlin spymasters played up a Bavarian teenager, Lisa, who claimed she had been abducted and raped by “southern” refugees. The girl, Lisa, was an ethnic German born in Russia whose family had been admitted to Germany, one of about 3 million Russian-speakers admitted during the Cold War. Meanwhile German police discovered that the child had invented the rape because of a bad notice from her school. She had hidden in a friend's house. This didn't stop the Putin machine from exploiting l'affaire Lisa to attack Merkel's support for refugee asylum, and her support for sanctions against Russian soldiers fighting for Ukrainian breakup and Putin snatching Yalta. Russian cyber spies also allegedly hacked the Bundestag (Congressional) website removing sensitive data.

 

Calling it the Year of the Rooster appears to be a misnomer. In fact it is the Year of the Chicken—which doesn't sound as good for stock markets—according to my Ob-Gyn (of Chinese heritage). My favorite “chicken” play is discussed below along with news from Australia, Germany, Britain, India, Ireland, Israel, Spain, Brazil, Japan, Mexico, Denmark, Switzerland, the Dutch Antilles, Canada, Ireland, Panama, Bermuda, the Cayman Islands, Japan, and a few other places. This issue is a twofer.

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The Nightmare Continues

Sun, 2017/01/29 - 3:07pm | Your editor

 

The Trump continues with another wild move in Washington Friday evening, an attack on freedom of religion despite the First Amendment to our constitution and the ancient British common law right of habeas corpus, also incorporated into US law. An executive order was created to delay the granting of visas to Muslims from seven selected countries. It was then applied to persons  travelling here with valid  visas and/or green cards allowing them to legally enter the USA. Actually arresting these people has been turned back by a NY judge but there seems to be no recognition yet by the White House of  the astonishing mistake this executive order represents.

It is always hard to get Pres. Trompe l'oeil  to admit he goofed. Read more »

My Nightmare

Fri, 2017/01/27 - 2:05pm | Your editor

I am suffering from a nightmare after two surprise wild moves by in Washington yesterday, an attack on the press by Bannon who called The New York Times part of the “opposition” and the Trump tweet that he will impose a 20% tax on Mexican imports to the USA to pay for the wall. My issue yesterday closed before we know of these rumblings from the new administration, which is driven by PR rather than by any government experience.

 

I am particularly worried about how the Trumpians are ignoring the lessons of from the past, starting with the 1930s but extending into later years.

 

With the Trump Mexico tax, we risk unrolling the whole global free trade consensus which fostered global markets and economic integration after World War II. Will it be back to Smoot-Hawley and the foreign reprisals which extended the Great Depression?

 

By attacking and blocking the American press our country risks slipping into government by Twitter without critical commentary. That leads to dictatorship, of the left or the right, as was also seen in the 1930s and to the McCarthyist Big Lies of the 1950s. We can live through 1984 all over again, complete with torture of dissidents.

 

Removing the safety nets of welfare, public education, public housing, and medical insurance from the poor will fill out country with poor, sick, homeless, addicted, and illiterate neo-Okies. There will be many more illegitimate babies because of restrictions on abortion and they will compose a criminal underclass such as terrorized our cities in the 1970s.

 

Deporting “wetbacks” and blocking legal fund transfers to Mexico will create illegal fund transfers, money laundering, and criminality among those denied a normal life here. We have seen this before.

 

Immigration rules targeting Muslims will trigger more not less Islamist terrorism. I am reminded of nothing so much as the Kafka-esque measures which made it so hard for my parents and one set of grandparents to emigrate here from Germany. (My other grandparents died in a concentration camp because they couldn't get an “affidavit of support”.)

 

Denying the risks of climate change will bring back the Silent Spring Rachel Carson wrote about.

 

More bad science on the causes of autism can lead to uncontrollable outbreaks of childhood diseases like measles, mumps, and whooping cough.

 

Rebuilding highways and airports, like making the Italian trains run on time, will not resolve real economic problems, to the extent that Washington even knows about them. But government spending does risk triggering inflation.

 

Fighting Mexico will lead to a new Pancho Villa. It will be Andres Manuel Lopez Obrador.

 

If relations with China deteriorate further, its military and nuclear capacity will be used against us. We may have to remove another Gen. Douglas MacArthur threatening nuclear war. Wrapping itself in an appealing ideology China can gain great influence among those who want clean air and global trade. Buddying up to Putin will not help any more than the Hitler-Stalin pact helped Europe in the 1930s.

 

Of course this is a nightmare scenario and none of these events necessarily will happen. It is likely that the 20% border tax on Mexican exports will be blocked by wiser heads (like companies whose supply chains run across the Rio Grande). Our future Secretary of State, once he had been briefed, will point out that the President's tax idea is a violation not only of NAFTA but also of the World Trade Organization and other existing treaties.

 

The attacks on the press and the support of torture are sufficient unAmerican that even a Republican Congress will push back against these proposals.

 

But I am still scared.

 

Affected companies are up, down, and sideways today. More for paid subscribers follows from Mexico, Canada, Panama,Switzerland,  Brazil, Britain, Denmark, India, Ireland, Israel, and Finland.

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