We're serving up another round of our weekly charts. Since a picture can be worth 1,000 words, I try to zip my lips (well, mostly) and let some carefully selected graphics convey a few critical investing and economic insights.

This week's gallery includes:

• The No. 1 reason to steer clear of hedge fund investments.
• The key metric that will influence whether or not the Federal Reserve ever stops printing money.
• The most misleading news of the week. (The truth shall set you free!)

Hedge Funds Don't Do a Portfolio Good

Hedge fund managers (still) can't catch a break. In early March, I noted how their performance was lagging behind the S&P 500 and (gasp) lowly mutual fund managers by about six full percentage points. Well, fast forward two months and they're now behind by 10 full percentage points, according to the latest analysis from Goldman Sachs.

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The world's largest fixed-income manager, Pimco's Bill Gross, told Bloomberg recently that he "see[s] bubbles everywhere." Talk about an ominous statement for investors. But if his "everywhere" includes the residential real estate market, Gross is sorely mistaken. As I shared recently, the real estate recovery is legitimate. And it's gaining traction, too. However, the way we capitalize on this trend is evolving.

Forget the Usual Suspects

No longer can we expect to book the biggest profits on the most obvious beneficiaries of a housing recovery -- homebuilders. Nor can we bank on "first derivative" opportunities -- companies with obvious ties to an uptick in home sales. I'm talking about home improvement stores like Home Depot (HD) and Lowe’s (LOW), and building materials suppliers like Lumber Liquidators Holdings (LL) and Masco Corporation (MAS).

As I told you in late February, these plays are too obvious and overcrowded

Sound the alarm! We're witnessing another real estate bubble. At least, that's what the mainstream financial press wants to scare us into believing. A recent Bloomberg article, entitled "Brooklyn to California Bubble Threat Grows in Rebound," recounts an all-too familiar tale from the go-go days:

An open house for a five-bedroom brownstone in Brooklyn, New York, priced at $949,000, drew 300 visitors and brought in 50 offers. Three thousand miles away in Menlo Park, California, a one-story home listed for $2 million got six offers last month, including four from builders planning to tear it down to construct a bigger house.

Bidding wars! The ultimate sign of a bubble, right? Not so much…

The Same, But Different

Let's ignore, for a moment, that Bloomberg cherry-picked these examples, and that they're completely out of touch with reality. (The median price for a house in the United States remains below $200,000. Yet

It's time to put some ice on a hot investing topic. Some ice cube, that is. In his 1993 hip hop anthem, O'Shea Jackson, better known as Ice Cube, raps…

"You better check yo' self before you wreck yo' self. Cus' I'm bad for your health, I come real stealth."

And that's exactly the warning speculators in the new(ish) and wildly popular digital currency, Bitcoin, need to hear. Otherwise, they might find their dreams dashed - or worse, their portfolios "stealthily" ruined. Let me explain…

Desperate for An Alternative to the U.S. Dollar

Ever since the Federal Reserve embarked on its easy money campaign, everyone and their mother has been on a crusade for an alternative reserve currency. The battle cry? Stop devaluing our money! I hear you. But what are we going to do about it?

Several years ago, the euro was the top answer to the currency woes.

Let this be yet another reminder to trust, but verify, every bit of information on Wall Street. For months, we've heard that a "Great Rotation" is underway. That is, investors are dumping bonds and promptly putting the money back to work in equities. And this uptick in buying activity is precisely why the stock market keeps hitting new all-time highs.

Sounds perfectly logical. And Wall Street appears to be corroborating the theory. "You have this huge migration moving from grossly overweight fixed income back into equities," says John Stoltzfus, Chief Market Strategist at Oppenheimer. The only problem? The data tells an entirely different story.

Here's the proof in a single chart - and, more importantly, why Wall Street's latest deception ironically bodes well for us…

Stocks Back En Vogue

I'll be the first to admit that a transition is afoot. In January, investors (finally) rediscovered stocks. U.S. stock funds

If you constantly find yourself asking when the market is going to crash, you're a paranoid freak. You're not alone, either. By our best estimates, there are roughly 1.2 million such freaks trading the market each day.

What would happen if all these paranoid maniacs decided to sell? Well, it'd look a lot like the Hindenburg crash of 1937, which I just happened to watch a documentary about last night. Look, we're all human, which means it's perfectly natural to be a bit paranoid given that the market keeps hitting new, all-time highs (on what seems like a daily basis).

However, asking about it with no way of arriving at an answer makes no sense at all. Didn't you know that only purpose-driven paranoia is productive and acceptable? To that end, on Wednesday I introduced you to my trusty "Bear Market Checklist," which provides a systematic way to

0-for-9.

If any professional baseball player (particularly one in New York) puts up stats like that, he's immediately booed and ridiculed. But when it comes to a particular stock market indicator, it's actually a reason to celebrate. And guess what? It's time to break out the bubbly.

No Batter, No Batter, Big Whiffer!

I can't tell you how many readers routinely accuse me of being too optimistic. And I'll readily admit that I'm a "glass half full" kind of guy. Despite my predisposition, though, I always base my bullishness on cold, hard facts. So my optimism is always justified. What's more, when the data warrants a pessimistic stance, I have no problem embracing it. And we simply start sleuthing out attractive short-selling opportunities together.

Right now, however, there's nothing to be bearish about. And I say that with conviction, because my "Bear Market Checklist" is a perfect 0-for-9. Not a

Let this be yet another reminder to trust, but verify, every bit of information on Wall Street. For months, we've heard that a "Great Rotation" is underway. That is, investors are dumping bonds and promptly putting the money back to work in equities. And this uptick in buying activity is precisely why the stock market keeps hitting new all-time highs.

Sounds perfectly logical. And Wall Street appears to be corroborating the theory. "You have this huge migration moving from grossly overweight fixed income back into equities," says John Stoltzfus, Chief Market Strategist at Oppenheimer. The only problem? The data tells an entirely different story.

Here's the proof in a single chart – and, more importantly, why Wall Street's latest deception ironically bodes well for us…

Stocks Back En Vogue

I'll be the first to admit that a transition is afoot. In January, investors (finally) rediscovered stocks. U.S. stock funds

It's time to once again abandon long-winded analysis and let some carefully selected graphics do the talking for us.

Record High? Think Again

MarketWatch's Mark Hulbert said, "Stock market bulls face an inconvenient truth as they celebrate the stock market’s new all-time highs." What is he talking about? Apparently, we're supposed to be miffed that the S&P 500 Index didn't actually hit a new all-time high. At least, not on an inflation-adjusted basis.

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We need stocks to rally about another 25% before we can make such a boast. Oh, how "inconvenient!" We've already shown that history points to this bull market lasting longer. So shoot me now and spare me the misery.

Talk About Stimulation

Want to know how the economy is doing? Forget about tracking consumer spending, manufacturing activity, or unemployment claims. Just be on the lookout for pregnant women. You might think that's inappropriate,

In yesterday's column, I shared the startlingly low expectations analysts had for first-quarter earnings. And, of course, their predictions were rendered totally irrelevant. For the second consecutive quarter, S&P 500 companies are on pace to grow earnings by about two percentage points more than analysts originally expected. While their ineptitude may not be all that surprising, here are five more earnings season trends that might be…

Again, take note and invest accordingly.

~Surprise #6: Europe's Woes Aren't Sabotaging Revenue "Beat Rates"

Yesterday, I focused on the mildly bullish earnings "beat rate." Today, it's time to turn our attention to the revenue beat rate (i.e. - the percentage of companies topping analysts' expectations for sales). To put it bluntly, it started off in the tank at a mere 43%. Truth be told, we haven't witnessed such a terrible reading since the height of the financial crisis. Thankfully, though, we've made

While most investors continue to track every jot and tittle of the market to see if we hit yet another record high, a more important situation is still unfolding. What could that possibly be? Oh, just a little something called earnings!

Remember, stock prices ultimately follow earnings, and we're still in the midst of the first-quarter earnings reporting season. Most analysts predicted that results would be terrible this go-round. On average, they expected S&P 500 companies to report a 0.7% contraction in profits. With roughly 80% of companies' reports on the books, though, S&P 500 earnings actually grew by 3.2% in the first quarter. The strength is broad based, too, as nine out of 10 sectors have reported stronger earnings relative to last year.

Talk about a swing and a miss by analysts! What an embarrassment. However, there are several surprises contained within the reports. Take note

Only in the government’s fantasy land does its math add up. On Friday, the Labor Department reported that the economy added 165,000 new jobs in April. It also revised February and March data up by a combined 114,000 jobs.

More jobs are obviously a good thing. However, the misrepresentation comes in when the Labor Department brags that the gains helped push the unemployment rate down 0.1 percentage points from March – and 0.4 percentage points from January – to 7.5%. Total crap!

That’s not the real unemployment rate. It actually went up in April. And in honor of Myth-Busting Monday, I’m going to prove it…

Never Trust the Government

Not surprisingly, governments like to paint an overly rosy picture whenever possible. And when it comes to reporting the “official” unemployment rate (known as U-3 unemployment), that’s exactly what they do. Making matters worse, the mainstream press totally

As the saying goes, once you hit the top, there's nowhere to go but down. That's especially true for companies making it to the list of the top five highest-yielding stocks in the S&P 500.

Consider the following: Over the last year or so, Frontier Communications (FTR), RadioShack (RSH), and CenturyLink (CTL) all spent time on the list. And, lo and behold, their dividends got slashed and share prices cratered. Pitney Bowes (PBI) is the latest company to join the ranks of these dividend disappointers. On Tuesday, management announced that first-quarter earnings sank 57%, and they were cutting the dividend in half -- from $0.375 per quarter to $0.1875.

As Chief Executive Marc Lautenbach said, "This action will provide us the added financial flexibility to invest in the business and enhance our capital structure, while continuing to provide a very competitive return to shareholders." Sure.

If repetition breeds retention, it's time for an annual warning. Especially since it's the first day of May. At this time of year, countless media outlets can't help but regurgitate the investing adage "sell in May and go away."

Recent history promises to make this year's warnings all the more urgent, too.

You'll recall, the stock market sold off anywhere from 9% to 19% in the middle of 2010, 2011 and 2012. But please don't fall into the recency bias trap. That is, using the most recent market experiences to make sweeping conclusions about the future. While the last three years make it seem like a "sell in May" strategy would be a no-brainer, the long-term data paints an entirely different picture.

Don't Get Duped Out of Stocks

When you see a chart like this one from U.S. Global Investors, which I showed you last year, even I'll admit

If you’re a newbie to the Wall Street Daily Nation, you’re in for a treat. Each Friday, I try to zip my lips and let some carefully selected graphics do the talking for me. This week, I’m dishing on China, Vietnam, Indonesia, the risks of tweeting while investing and, last but not least, yet another fledgling real estate recovery.

Pictorial enlightenment begins in three, two, one…

Trust, But Verify

The internet is a blessing because it accelerates information sharing. But it’s also a curse because it accelerates misinformation sharing, as well. Case in point: Tuesday’s tweet from the Associated Press saying, “Two explosions in the White House and Barack Obama is injured.” Although completely false, it caused the Dow to collapse 150 points in four minutes flat.

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There’s a lesson to be learned here: Trust, but verify every bit of information. Heck, the same goes for information

To paraphrase an observation made by Amazon's (AMZN) Founder and CEO Jeff Bezos: People who are "right a lot" are people who often changed their minds. Simple words. Such profound wisdom. Particularly for investors.

How many times have we clung to an investment philosophy for dear life, only to end up being dead wrong? And, in the process, we either lost (lots) of money or missed out on (lots) of profits. It's not your fault. Blame your genes. As I've noted before, we're prone to confirmatory bias. That is, we seek out information congruent with our own beliefs with much more fervor than contradictory data. So don't worry. I'm not here today to beat you up for your past investing sins. I've got plenty of my own. Instead, I'm sounding the alarm bells, because it's time to overcome nature. Otherwise, you're going to miss out on the tremendous profits

Here's a shocker for you, straight from Beijing… No, I'm not talking about how China's manufacturing growth unexpectedly cooled in March. Fears over a slowdown in the world's second-largest economy are so yesterday's news.

Especially after we learned roughly two weeks ago that China's GDP growth rate slid from 7.9% in the fourth quarter of 2012 to 7.7% in the first quarter of 2013. (That's great by U.S. standards, but stinks for China. It's actually the slowest rate in over a decade.)

Instead, I'm talking about the fact that China just turned its army loose on the United States. That is, an army of financial attorneys. Because online retailer, LightInTheBox (Proposed Ticker: LITB), officially filed plans with the SEC to go public.

What's the big deal? For one thing, it's the first Chinese company to file for an IPO on a U.S. exchange in 2013. More importantly - and I

A segment of our readership at Wall Street Daily routinely bludgeons me for being overly optimistic. Heck, I think some want to sue me for being a "glass half-full" kind of guy. (The gall!)

Well, today, I'll leave them no such room for criticism.

Plain and simple, if the earnings numbers coming from corporate America don't improve, this bull market is in serious trouble.

Survey Says? It's All About Earnings!

Every spring and fall, Barron's conducts its Big Money Poll of institutional investors. The latest edition came out this weekend. And in response to the question, "What would send stocks sharply higher in the coming months?" - 135 managers all agreed that it's "corporate earnings."

Why bring it up?

Because I know that not all of our readers believe me when I repeatedly say that stock prices ultimately follow earnings. Don't doubt me anymore!

As Barron's

Skyrocketing. Surging. Spiking. Take your pick. Because they’ve all been used to characterize price trends for something we can’t live without: food. It’s all a bunch of baloney, though. (Sorry, I couldn’t resist.)

And seeing that it’s Myth-Busting Monday – the one day of the week we dedicate to challenging Wall Street and the world’s most cherished conventional wisdom – I’m going to prove it to you, too. So let’s get to it…

Stop Pounding the Inflation Drum, Already!

Forget months. For years, we’ve been told that the ultimate consequence of Fed Chairman Ben Bernanke’s out-of-control money printing is going to be nasty inflation. Well, I’m still waiting.

The latest Consumer Price Index (CPI) reading actually fell 0.2% in March. Of course, everyday Americans don’t pay attention to the CPI. I’m sure countless people would say that it must be a spin-off of CBS’ wildly popular CSI series. (Go ahead.

“Me want more income!” Forget the Cookie Monster, investors are turning into income monsters. Case in point: A new survey released by Legg Mason reveals that two-thirds of affluent investors in the United States peg income investing as their top priority.

Yet their appetite for income isn’t being satisfied. More specifically, they desire an annual yield of 8.5% on average, but they’re only averaging about 6% yields. And more than half of the respondents to the survey said that they’re willing to take on more risk to earn more income. My response? Somebody needs to tell them about the income-generating power of merger arbitrage.

The Two Keys to Merger Arbitrage Riches

Merger arbitrage is a simple strategy that involves nothing more than waiting until after a takeover deal is announced to buy into a company. By doing so, we get to pocket the “spread” between the current