In the computer world it’s called “garbage in, garbage out.” Or simply “GIGO” for short. It refers to computer code. If the code is wrong when it goes in, the software or program will never work coming out. The same statement applies equally to economists and their many forecasts. They put mountains of data into…
DetailsIn his book Adventure Capitalist, Jim Rogers wrote: Markets will rise higher than you think is possible and fall lower than you can possibly imagine. It’s right and, more importantly, exposes the only two ways to make serious money in stocks. One way to do it is to buy beaten up stocks that are starting…
DetailsAn apology is in order. I’m sure that over the last few days you’ve been exposed to countless “how to make money from oil’s fall” article. It’s the big story. It’s what people want to know about. And it’s what the media will happily (and quickly…probably too quickly) provide. I’ve seen quite a few myself.…
Details“The drama is far from over.” That’s what Daniel Yergin recently wrote in an editorial on the current oil crisis in The Wall Street Journal. Yergin knows a thing about oil’s place in the world too. He’s the author of “The Prize: The Epic Quest for Oil, Money & Power.” It’s the most comprehensive book…
DetailsA long-time colleague and one of the the best stock traders I’ve ever known sent me an e-mail early this morning. Just seeing his name in the “From” address got me excited. The reason is because when he sends me a message, I know there’s a great idea in there. The last time I heard…
Details“Follow the hipsters.” That’s what a good friend of mine who’s in the real estate business recently told me. He meant that when the hipsters – with their beards, skinny jeans, and unicycles – start moving in, you know prices are about to go up big. He’s right too. Brooklyn, New York is one of…
DetailsInvestors are making a big bet on oil prices. Collectively, they’ve bet hundreds of millions of dollars on oil prices. Some of your editor’s research shows they’re likely in for a big surprise. A surprise that, if it plays out the way the odds and history tell us it will, that will end in tears,…
DetailsWhole Foods (WFM) is one of the biggest investment successes of the past few decades. What Whole Foods did was make the grocery business profitable. Historically, the big grocery store chains post net profit margins around 1%. Even the best-managed ones were rarely ever able to eek out net margins as high as 2%. It…
DetailsThe most recent correction was like an earthquake. It was scary during it. No one knew when it would end. And now, weeks after it has passed, the aftershocks are still being felt. One of the biggest aftershocks is in interest rates. What happened is going have a big (and likely negative) impact on one…
DetailsThe last correction was a big test for the stocks you hold. If the stocks you hold were the big winners over the last few years (like oil stocks) and were hit hard in the correction, that doesn’t bode well for their future performance. Odds are they were the expensive stocks. The cheapest stocks in…
DetailsImagine you live in a town with two coin dealers. One of them is having a “bear market sale” on gold. They poorly forecasted demand and now have to unload some inventory. So they have offered up gold at $1200 an ounce. The other coin store in town is paying market price for gold at…
DetailsAfter a move too high, too fast, the markets were doomed to crater, we argued in early October 2014. Greed ran too high, as market participants thought the Fed’s loose policy-party could go on forever. But, as we all know, the party was coming to an end in late October 2014. Economic realities, global tensions…
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