When Are Cheap Investments the Best Investments?

Archive for the ‘Profitable Investing Tips’ Category

When Are Cheap Investments the Best Investments?

By Jim Walker on Wednesday, March 6th, 2019 | Comments Off

A couple of years ago we wrote to beware of penny stocks. The point being that cheap investments are not necessarily good investments. After all, there is probably a good reason why a stock is selling for a low price. On the other hand, companies that are just starting out and are not being watched by Wall Street analysts may be very promising but no one is watching. The bottom line for stock value (as opposed to price) is intrinsic stock value. When you have unique insights about the stock in question and the big guys are not watching, you […]

Why Invest in Boeing?

By Jim Walker on Monday, March 4th, 2019 | Comments Off

Not long ago we wrote about whether or not Boeing would need to outsource production in order to remain profitable. That question largely had to do with the threat of a long-term trade war and Boeing potentially losing markets as a result. The trade war may well be on its way to at least a temporary resolution so the question is why invest in Boeing over the long term? Essentially Boeing is a cash cow with a dominant position in an increasingly higher and higher cost of entry business. Its only real competitor is Airbus as the two of them […]

How Can You Invest in Artificial Intelligence?

By Jim Walker on Wednesday, February 27th, 2019 | Comments Off

Back in the day when Jobs and Wozniak invented the Apple computer they simply used existing technology to provide folks with their own personal computer. As computer technology has advanced over the last forty years it has been incorporated into PCs, laptops, tablets, and smart phones. Investors who profited were the ones who put their money in companies that made the best use of better and better technology. Today the “new wave” of technology is artificial intelligence. How can you invest in artificial intelligence? There are not very many companies that are pure AI investments. But, many of the tech […]

What Was Wrong at Kraft Heinz?

By Jim Walker on Monday, February 25th, 2019 | Comments Off

Last week the stock of the packaged food giant, Kraft Heinz, took a nosedive. The stock fell by 28% on news of a SEC investigation of the company’s accounting practices but more so the nosedive was due to gigantic losses in the last year. The package food business is very competitive and companies need to balance quality, price, advertising, and new product lines in order to stay competitive as much so as to gain an advantage. What was wrong at Kraft Heinz was that they seem to have lost their way. Cost cutting became the order of the day in […]

Panic Buying of Investments Is a Bad Sign

By Jim Walker on Wednesday, February 20th, 2019 | Comments Off

A friend of ours commented recently that panic buying of investments is a bad sign. He is old enough to remember when the three Hunt brothers tried to corner the silver market and failed.
Panic Buying of Silver in 1979 to 1980
The boom and bust of silver prices is remembered as Silver Thursday, March 27, 1980. Silver was trading at around $6 an ounce in early 1979 and as the brothers purchased increasingly larger amounts of silver on margin, the price rose to $49.45 by January 18, 1980. By that time the three Hunt brothers controlled a third of all silver […]

Time to Invest in GM?

By Jim Walker on Monday, February 18th, 2019 | Comments Off

General Motors was once the largest corporation in the world and the king of U.S. auto makers. Foreign competition ate away at its customer base and profits and the financial crisis dealt the final blow. In 2009 the once-king of U.S. automakers filed for Chapter 11 bankruptcy protection with US$172.81 billion in debts and US$82.29 billion in assets. The company divested itself of numerous assets keeping the Chevrolet, Cadillac, GMC, and Buick brands as well as controlling interests in numerous foreign automobile operations. After reorganization, the new GM emerged in a $20.6 Billion IPO in November of 2010. Any money […]

Win the Trade War and Lose on Your Investments

By Jim Walker on Wednesday, February 13th, 2019 | Comments Off

The trade negotiations between the USA and China are coming to a head. Will there be genuine gains for the USA? We have written how both the USA and China have issues that they see as crucial to their national prosperity and security in our article about if the trade war becomes permanent. However, neither side wants to suffer the economic pain that could come out of a protracted trade war. China, especially, is seeing economic difficulties on the horizon and needs to do something sooner rather than later. So, there may well be a deal forthcoming. However, from the […]

How Do Job Cutbacks in China Relate to Your Investments?

By Jim Walker on Monday, February 11th, 2019 | Comments Off

China has been the economic miracle of the world for decades. From Nixon’s visit in 1972 to its entry into the World Trade Organization to the current day, China has not had a negative growth year since 1978 and has average a 10% GDP growth rate. At the same time North American and Europe are ecstatic with an occasional 5% growth rate and typically languish in the 2% to 3% range. But, things are not all well in the Land of Managed Capitalism (by the Communist Party). Debt is rising and there is a potential for a long term trade […]

Choosing Deep Value Investments

By Jim Walker on Thursday, February 7th, 2019 | Comments Off

Many investors are pessimistic about the prospects of their investments in the coming year. In this regard we are looking at the process of choosing deep value investments. We see the pessimism in that stocks are rising on tepid earnings reports as The New York Times reports.
Late last month, chip giant Advanced Micro Devices reported disappointing financial results for the fourth quarter and warned that its first quarter performance would be weaker than expected. The stock surged 20 percent. A couple of days later, General Electric reported one of its skimpiest quarterly profits of the century, badly missing analysts’ forecasts. […]

Trump Tax Cut a Bust for Investment and Hiring

By Jim Walker on Monday, February 4th, 2019 | Comments Off

When Congress passed the biggest change in the U.S. tax code in thirty years, taxes were cut by $1.5 Trillion. The promise was that U.S. industry would invest that money, hire more people, and raise yearly GDP growth to the 4% range for the indefinite future. That did not all seem to have happened according to recent information. Was the Trump tax cut a bust for investment and hiring? Here are some thoughts on the subject.
Trump Tax Cut a Bust for Investment and Hiring
Fortune explains why the tax cut has not sparked hiring or investment.
The Trump administration’s $1.5 trillion in […]

Archive for the ‘Profitable Investing Tips’ Category