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  • Stocks to Benefit From an Iron Ore Bull Market [View article]
    One thing when it comes to commodities, with iron ore you don't have to worry about not having enough rain or getting too hot or getting wet at harvest time. Regardless, the stuff will always be there. Its just a matter of demand and mining/shipping infrastructure and the quality of new sources coming on line to compete. Its amazing that MN can supply China with it economically. And, as an inflation hedge, MSB has been better than gold these past two years.
    Feb 4, 2011. 09:43 AM | 2 Likes Like |Link to Comment
  • Johnson & Johnson Should Fit Nicely in Most Dividend Portfolios [View article]
    JNJ - Certainly a good LT hold. I bought it on the high side and will await to add as cash builds in my IRA.

    My attraction was their new blood test for tumor tracking. I believe that this low invasive diagnostic test can be further developed for preliminary screening. If this then takes hold - it could be their Viagra to be a multi-billion dollar market. No doctors would miss prescribing this test. The risk to miss a diagnosis of cancer would make it mandatory.
    Feb 3, 2011. 03:01 PM | 3 Likes Like |Link to Comment
  • Is Crude Oil Breaking Out? [View article]
    Very interesting that current speculation is on shipping and the amount is not that significant to push up costs of shipping to the extent that the price has already moved. If a peaceful transition is realized, the price decline could be much faster than the current rise and the longs won't be able to cover margin calls. Distant contracts may fall faster than close ins.
    Feb 2, 2011. 03:51 PM | 2 Likes Like |Link to Comment
  • Is Crude Oil Breaking Out? [View article]
    Egypt can be the first domino to fall with more liberal governments taking hold in the Middle East. This could break the hold of the cartel. I'd keep speculative long positions in short-term contracts only. Long-term could be a disaster.
    Feb 2, 2011. 03:15 PM | Likes Like |Link to Comment
  • Under the Hood of the CPI: Transportation Inflation [View article]
    Correct. But we are the victims of its use. The CPI adjusts the incomes of a significant majority of Americans including Government Retirement Annuities, Government Salaries and locality salary differentials, Social Security Retirement and disability payments along with many private business and labor unions in setting salary and pension payment increases. Accuracy in measurement of the cost of living is very important and additional funds and support should be directed to improving the index's reliability and timeliness.

    Retirees are suffering from increases in medical costs and are not benefiting as much from reduced interest rates on mortgages and other housing costs. We need age differential indices to show consumer weights for the different age groups to better gauge the need to increase annuities to cover these costs that are well outside the average of the total population.
    Feb 2, 2011. 10:57 AM | 1 Like Like |Link to Comment
  • Stocks to Benefit From an Iron Ore Bull Market [View article]
    Wow! You make it look like us MN folks are just small potatoes in this fray. To get all this iron out of the grough they are all going to need CAT and with the BUCY takeover they are the dominant mining machinery company.
    Feb 2, 2011. 09:25 AM | 5 Likes Like |Link to Comment
  • Ken Fisher's Top 10 Holdings [View article]
    Have to mention that CAT on your list was the best performing stock in the DOW average.
    Feb 2, 2011. 09:20 AM | 4 Likes Like |Link to Comment
  • Holy Grail for Income Investors? Consider Floating Rate Preferreds From BofA, GS [View article]
    Stay diversified. Merrill, Countrywide and BAC are all the same bucket. But, Merrill and Countrywide prefereds are better yielders.
    Feb 1, 2011. 06:13 PM | Likes Like |Link to Comment
  • Flir Systems: Unique, High-Quality Company With Exposure to Best Part of Defense [View article]
    Keep pushing the print button I'll keep pushing the read button.
    Feb 1, 2011. 06:08 PM | Likes Like |Link to Comment
  • At the close: Dow +0.56% to 11890. S&P +0.76% to 1286. Nasdaq +0.49% to 2700.
    Treasurys: 30-year -0.77%. 10-yr -0.31%. 5-yr -0.13%.
    Commodities: Crude +2.88% to $91.91. Gold -0.75% to $1331.60.
    Currencies: Euro +0.59% vs. dollar. Yen +0.1%. Pound +1%.  [View news story]
    The "buy" was a good call. accelerated on Tuesday. Now for the crystal ball for Wednesday.
    Feb 1, 2011. 06:06 PM | Likes Like |Link to Comment
  • WSJ's latest quarterly survey of housing market conditions finds that prices declined Y/Y in all 28 major metro areas tracked during Q4. Home values dropped most in cities already hit hard, such as Miami, Orlando, Atlanta and Chicago, but price declines also intensified in several markets that had escaped the worst, such as Seattle and Portland.  [View news story]
    The 27% is the increase from the bottom of the market, a little more than 2 years ago.
    Feb 1, 2011. 06:03 PM | Likes Like |Link to Comment
  • Under the Hood of the CPI: Transportation Inflation [View article]
    The CPI and how it affects a family are not directly related. There is generally no month to month measurement of changes in consumer expenditure patterns. It assumes that the consumer expenditures per item are constant as in a base period. Then it measures the change in prices weighted by the importance of expenditure of the average family during that base period. For most items the base period weights do not change. Items such as interest rates and home ownership may rely on a more frequent measure of change than the base period for store purchased items.

    For this reason, I believe there is a bias in the index in not accurately measuring price change for items that are rapidly changing from technology and rapid shifts in consumer preference.

    When the flat screen TV came out it probably was not priced at all and then its impact to infaltion not measured well its price fell.
    Feb 1, 2011. 03:51 PM | Likes Like |Link to Comment
  • Under the Hood of the CPI: Transportation Inflation [View article]
    Unfortunately the price index doesn't work that way at all. The weights from month to month are constant. The only thing that is measured is price change. The weights change periodically when they conduct a consumption/expenditure survey.
    Feb 1, 2011. 03:36 PM | Likes Like |Link to Comment
  • Under the Hood of the CPI: Transportation Inflation [View article]
    The main problem in the CPI to accurately reflect inflation changes is that the adjustments in pricing items covered are changing more rapidly than ever before. Also, consumer preferences are changing very rapidly be it consumption of organic food, to purchasing hybrid vehicles to using new electronic mobile computing devices. The weights are constantly changing but month to month and quarter to quarter weighting remains unchanged.

    Items are not phased out quickly enough. Consumer expenditure shifts also are not measured as frequently as the price monitoring. Items such as the i-Pad and 4G network connection fees are probably not yet considered but comprise a significant portion of consumer expenditure where price competition for these items from similar items are actually providing a deflationary affect.

    Kudos however should be extended to the BLS, who I consider the best statistical agency in the Federal Government, when they phase out obsolete items and replace items with more consumer preference change items.
    Feb 1, 2011. 10:52 AM | Likes Like |Link to Comment
  • Under the Hood of the CPI: Transportation Inflation [View article]
    Quality adjustments can be adjusted by the item description of what is being priced on the survey. When I doing price surveys for USDA and when we were doing farm household consumption items, I noticed bi-modality for refrigerators when ice-makers were becoming popular. This indeed increased the price of the item. Simple revision to the description on the survey questionnaire stating cubic capacity and the phrase "without ice-maker" did the job of standardizing the comparability of price change for the item in the index.
    Feb 1, 2011. 10:38 AM | Likes Like |Link to Comment