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near end of year report

Dec. 10th, 2009 | 06:06 am

it looks like my predictions for 2009 were pretty good. heres what they were from my early january post
ere are my 2009 predictions. Im not predicting these for the end of 2009 but for them to occur sometime in 2009

S&P 500 index trades 1100
Crude oil $70/barrel
10 year treasury bond yields 3%
gold hits 1200/oz
unemployment hits 8.5%
30 mortgage is 4.5%

i missed on the 10 yr yield and the unemplyment rate is much higher than I thought it would be

Now for 2010
I dont think the market will have as good of a year in 2010. I think the market will rally in 6-8% area
If you combine that with a dividend of 4-5% like alot of my favorite stocks pay you still get a 10-12% return ,not bad over all

here are a few of my favorite stocks the first 3 are partnerships

now for some utilitys
CPL (a brazillian utlility)
AWK (a water company)
SBS (a brazillian water company)

some telecom companies

commodity companies

and a couple of banks

you will notice that most of my stock picks pay good dividends which I think will be very impolrtant in the coming year

I will make all my predictions at the begining of 2010

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im back to take profits

Oct. 23rd, 2009 | 10:15 am

after not posting for 2 months im back.  between moving cross country and lif in general i just havent had a cjance to post but im back

last time i posted i said i expected the market to pull back to 950 on the s&p where i though we would bottom.  I was wrong. the market kept rallying up to 1100 on the s&p and 10000 on the dow.

what about now? as im writing this the dow is right at 10000 down 90 on the day.  this is despite great earning from some companies and some decent economic numbers.  To me this is a bad sign.  The market is failing to rally on good news. beacuse of this i decided that some profit taking was in order. I sold about 5% of my stock exposure. I think the risk/reward in the market has reacehd a point where some prudence and profit taking is warranted. You are never wrong taking a profit.

what i did was went thru my portfolio stock by stock.  If i had a large gain on the stock and if it had a good rally recently i sold some. Not all but enough so i only had my original investment left in the stock.  If i had bought 5k of a stock and it was now worth 7k i sold 2k worth.  if I was down money on teh stock i evaluated the stocks prospects. If i thought it was still a good stock i kept it if i was a little unsure about it I sold some. 

This doesnt apply to the MLP's.  Im still bullish on them even though they have had a great run this year.  I still think they are cheap.  I did sell some however using a different criteria. There were some individual names that have rallyes so much i felt I just to much in the one name.  I pared back these individual names.

The cash i raised Im going to keep in a warchest so if the market does pull back i have some extra cash to buy

I do have a couple of individual stock recommendations though.

Number one is a company called American Dairy ADY.  Despite its name it is a chinese company. They are the largest dairy providor in china. china is working to increase dairy consumption among its citizens which is only good for ADY.  They also werent affected by the melanine crisis in china where some companies were adding melanine to milk to make it test higher for protein.  This proved fatal so some children and since ADY wasnt involved they increased their market share.  The crisis reduced dairy comsumption but consumption ahs begin to increase again

another company is verizon VZ.  They pay a high dividend in a mature industry.  While i expect only modest gains from the stock combined with a dividend over 6% i think its a good play for a nice total return without alot of risk

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further reasons not to belive analysts

Aug. 18th, 2009 | 09:01 pm

according to bloomberg if you did what the major brokerage houses recomended in march at the stock market lows. and bought what they told you to buy and shorted what the told you to sell you would have turned a 10.000 investment into -6000 dollars.  not only would you have lost your original money you would owe an additional 6k on what you shorted.

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the rally continues

Aug. 7th, 2009 | 02:31 pm

well we has the quick rally to 1000 that i thought we would have,now it gets trickier.  Unemployment for july was better than expected but how much of that was already built into the market?

I expect the market may continue to rally for a little bit before we get a pullback maybe to 950 on the s&p.  we are heading toward september which is historically the worst month of th eyear for stocks.  if we get a major pullback i think its a buying opportunity,although i wouldnt chase stocks up here

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stocks rallying

Jul. 23rd, 2009 | 09:49 am

it looks like were getting the rally i talked about.  we could run to 1000 on the s&p in the short term although im not quite that bullish i think 985 would be a good upside target. im looking to sell options up in that area

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stock recommendation

Jul. 20th, 2009 | 08:10 am

I read about his in Barrons and I agree. this is a stock Ive owned in the past and i think it is a good buy.  I bought some this morning

a spanish banking comglomerate.  No exposure to sub prime.  run very efficently with a low cost structure.  Has a dividend in th 7% area.
large brazillian presence.  own soverign bank in the US

major risk is the slow spanish economy which can cause a spike in non performing loans in spain which could negativly effect the bottom line but I think STD can weather that since they are so well run.

On another topic the market rallied sharply last week with the s&p at 940. I think it will continue and will test 950.  If it can break through 950 I think we will have a quick short covering rally that will bring the s&p up to the 975-1000 area.  Goldman just raised their year end s&p target to 1060 from 940. I agree and still think the dow will end the year over 10,000

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CA munis

Jul. 12th, 2009 | 08:04 pm

i still havent bought any california munis.  still waiting,being greedy.
as far as stocks,the correction is well under way. I expect the market to slip to somewhere between 820 and 850 on the s&p. With earning season underway I dont see people being very interested in buying stocks until there is some clarity on earnings.
right now im long alot of puts and short alot of calls to partially hedge myself if the market does go down. Im hedged about 50% or so

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muni bonds

Jul. 1st, 2009 | 09:23 am

california is broke with a hunge deficit.  right now california general obligation muni bonds pay around 6% interest which is free from federal income taxes. 
Under the california constitution interest on debt gets paid before any othe state debts besides education. so even i california cant pay all its bills it will have enough cash to pay interest. 
6% tax free = 8.7% pre tax (31% bracket). not bad for something with what I think has little risk

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Mid year report

Jul. 1st, 2009 | 07:57 am

well the year is 1/2 over.  The markets are pretty much where they began.  I actually up about 7.5% for the year so far

My prediction for the end of the year seems like it may have been a little to optimistic.  Im going to have to readjust my year end target for the dow.

I am lowering my year end target to 10000 from 11000. i just dont think theres enough time left in the year to hit 11000,especially since I thinkj the market will churn and not really go anywhere in july

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correction under way

Jun. 22nd, 2009 | 04:42 pm

 the long awaited correction has begun.  the s$p is trading under 900. I think it has a lttle more to go,im looking for s&p 875.  meanwhile the partnerships continue to get hit,PAA was down sharply today because of an analyst downgrade.  If PAA trade down to 40 im buying more *i had an order in at 39.97 but didnt get filled).  Im also lookig at adding to FCX,BAC and WFC if they go down much more and may buy MOS and some more MON is they fall another 5-10%
I am long the s&p 890 puts still and have rolled my short 990 calls first into the 950 strike and today into the 930's.  

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