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Mark Bern, CFA

 
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  • Dangerous Tools [View article]
    When the Fed says that there is nothing to worry about, it may be time to start worrying.
    Jul 14 11:03 AM | 2 Likes Like |Link to Comment
  • The Time To Hedge Is Now! Candidate Summary [View article]
    Dennis - I covered the exit strategy rules in Part X. I plan a new article to update where I am and what I think the next move should be. Should be complete within a day or two.
    Jul 13 10:09 PM | Likes Like |Link to Comment
  • What Does The VIX Now Say About The Stock Market? [View article]
    t time - I think you have a valid point in that things are not "normal" and have not been since 2009 with all the stimulus by the fed gov't and the QE by the Fed. We have also not experienced interested rates and "reported" inflation at such levels since WWII.

    From what I can tell, the VIX rises when stock prices are going down and falls when stock prices go up. It is supposed to measure volatility, but as the author correctly points out, it really only measures fear. When the fear is wrung out of the economy and the VIX stays low long enough run for cover, because then there won't be enough money on the sidelines to sustain the rally. The VIX can't stay low forever and stock indexes can't go up forever without occasional corrections. Buy the big dips!
    Jun 10 05:18 PM | 1 Like Like |Link to Comment
  • Don't Expect The U.S. Economy To Grow As Expected [View article]
    jhooper - Thanks for the memories!
    Jun 8 04:19 PM | Likes Like |Link to Comment
  • Don't Expect The U.S. Economy To Grow As Expected [View article]
    snoopy - You are correct. The participation rate is still down and not likely to rise any time soon unless there are some major policy changes by gov't. We've been getting policy changes but all in the wrong direction creating more of a drag on the economy. Many millions counted as working are only able to find part time work but are counted as employed. And another interesting piece of info that no one seems to be interested in mentioning is that many of the new graduates from high school and college remain unemployed much longer than prior to 2008. And until they get a job they haven't even entered the work force officially so they don't count. So, even the work force participation rate understates the real problem.

    The lack of "good" jobs being created is the biggest problem in America today and our political leaders either don't get that or are clueless about how to create jobs. Instead they pass or sign into law regulations that reduce jobs and reduce discretionary income of most average Americans.
    Jun 7 08:32 PM | Likes Like |Link to Comment
  • Don't Expect The U.S. Economy To Grow As Expected [View article]
    jhooper - Thanks for the lesson on US economic history. I agree. Even the 2008-09 crash resulted from multiple actions taken by the federal government and (more likely inaction) the Fed. Of course, greed in the private sector gets exacerbated when the gov't changes policies to encourage idiocy. Without the gov't blunders the booms and the busts would be much smaller and less damaging, imho.
    Jun 7 08:24 PM | Likes Like |Link to Comment
  • Don't Expect The U.S. Economy To Grow As Expected [View article]
    In 1983, US GDP growth was 11.39%. Interest rates were beginning to fall; the fed funds rate averaged about 9%, down from the high of 14.9% for 1984 and from the historical high of June 1981 at 19.1%. Back then 9% seemed like a bargain after what the economy had just been through. Also, double-digit inflation (14.2% high in 1980) had just been put to rest, averaging about 3.2% in 1983, we were in the early stages of a recovery after a recession, and the economy was adding jobs the way it is supposed to do during a "normal" recovery. My source for interest rates comes from the St. Louis Fed: http://bit.ly/16R6nGi My source for inflation rates: http://bit.ly/w4DfLb
    Jun 6 02:06 PM | Likes Like |Link to Comment
  • Don't Expect The U.S. Economy To Grow As Expected [View article]
    Craig - I know it was colder than usual this winter, but it seems like it gets cold every winter. It is a matter of degree and it didn't hamper my lifestyle one iota. When I needed something from the store I went to the store. The cold did not keep us in for a single day more this year than in years past.
    Jun 5 02:59 PM | Likes Like |Link to Comment
  • Don't Expect The U.S. Economy To Grow As Expected [View article]
    Go Lakers - I think what snoopy meant was that there were a heckuva lot fewer people without jobs during that period.

    Regarding the GDP growth from 2000 to 2008 here are the numbers and a link for more if your curious:
    2000 5.47%
    2001 2.17%
    2002 3.77%
    2003 6.42%
    2004 6.31%
    2005 6.52%
    2006 5.12%
    2007 4.42%
    2008 -0.98%
    Remember that those numbers are compounding. Thus, the total growth in GDP from the beginning of 2000 to the end of 2008 is much more than just adding up those numbers. Added together (39.22%) and divided by 9 (there are 9 years total) we get an average compound rate of 4.36%. But if we compound the numbers the total growth over the period from beginning to end is 46.47% and the average is 5.16%. That seems like a little more than 2%, even with rounding.
    Here is a link to my source: http://bit.ly/Scu776
    Jun 5 02:53 PM | Likes Like |Link to Comment
  • Don't Expect The U.S. Economy To Grow As Expected [View article]
    Additional evidence of a lowered expectation: http://yhoo.it/1hzb2bI

    In the article there are several good points why growth will not be as high as expected. Imports rose again in May and exports fell. This means that the trade deficit will be larger and that is a reduction to GDP. Several economists have lowered their guidance for 2nd Qtr GDP growth. Jobs growth was less than expected according to ADP, 179,000 compared to expectations for 210,000. Job and wage growth are the engines for consumption. Without adequate growth in these areas GDP growth stagnates. At this level the jobs pictures dims as we are only treading water leaving million unemployed.

    Last month the trade deficit reduced GDP growth by a full percentage point. Another increase can't help.
    Jun 4 12:35 PM | Likes Like |Link to Comment
  • Don't Expect The U.S. Economy To Grow As Expected [View article]
    Tohapane - I saw the correction. Thanks! But I do see additional signs of weakness in housing and retail.
    Jun 3 10:26 PM | Likes Like |Link to Comment
  • Don't Expect The U.S. Economy To Grow As Expected [View article]
    Bruce - Thanks for sharing your thesis. I'm not calling for a crash, just lower performance than forecast.
    Jun 3 10:24 PM | Likes Like |Link to Comment
  • Herbalife: Nailing Pyramids To A Tree [View article]
    There have been witch hunts to bring down the MLM industry before and it has survived. There are companies that don't do it right, but HLF understands the rules well enough to remain in compliance. I am not buying the idea that anything new will be found this time.

    That said, I personally tried an MLM company 3 decades ago. I actually got to a level of making a meager living and was on the verge of more than doubling my income with one new distributor that I had signed, a health club chain. Then the company went out of business. The owner did not have enough experience in MLM and paid out too much. It happens. In the end, if a person really believes in the products and uses them personally there is potential to build a business. If, on the other hand, someone gets into the business to make money only, they will probably fail unless they already have a down line from another MLM and are just moving to the next big thing. There is a lot of that and those are some of the folks who really give MLM a bad name.

    It's no worse than a bank that sells it customers securities while, at the same time, it is selling those same securities short to profit from the crash that it knows is coming. Some of the arguments against MLM being a scam could easily be applied against some financial institutions and when compared, MLM might look pretty good.

    I can't help but see this as an investment opportunity. But I prefer Nu Skin (NUS) over HLF. The ruling in China by regulators gave us a gift on a company that trades at a trailing P/E of 12 after experiencing growth of 50% in 2013. Growth will be down from that in 2014 (probably closer to 20-30%) but that is from a higher baseline. Long-term growth could average well over 15% compounded and dividends could double. The fundamentals of the company are compelling. http://seekingalpha.co...

    I prefer to get paid via dividends and I like it when my checks increase each year. That is why I like NUS over HLF. But I also believe that HLF will do well in emerging markets also. From an investor's point of view I like NUS for the rising dividend (just my style). But either will likely appreciate as the "opportunity" is easy to sell to someone who has never heard it before. Thus, the emerging markets have hundreds of millions of people to sell the concept to over the next decade or more.
    Jun 2 08:45 PM | 3 Likes Like |Link to Comment
  • Don't Expect The U.S. Economy To Grow As Expected [View article]
    jhooper - Thanks for the link!
    Jun 2 05:36 PM | Likes Like |Link to Comment
  • Don't Expect The U.S. Economy To Grow As Expected [View article]
    Climate change has happened over the history of the world. It has ebbed and flowed over the ages long before man's existence. It will continue to do so whether we want it to or not. And even if man's actions do make a significant difference it would require all major economies of the world to work in harmony to reduce the negative effects. That is not going to happen with China, India and many other emerging (and yet to emerge) nations going their own way.

    I suspect we will blow ourselves up before we make the planet uninhabitable.
    Jun 2 03:26 PM | 1 Like Like |Link to Comment
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