Wednesday, October 7, 2009

Christmas may have a surprise under the tree

There are a lot of articles predicting gloom and doom for the Christmas retail season. On one hand we hear the economy is recovering and on the other hand we hear that we're not out of the woods yet. I decided to take a very unscientific poll to find out for myself. I'd rather be approximately right than precisely inaccurate so I called a few friends and asked how they were preparing for Christmas. I got some surprising answers.

Several people told me that they remembered growing up in hard times but every ones parents had a Christmas Club account. They couldn't find a Christmas Club to join but decided to open a savings account or a money market account and they've been stashing some money away until they see the seasonal sales.

I also heard a term I hadn't heard in years. I remember how we bought my first big boy bike at Western Auto on a layaway plan. Every week we'd go in and I'd check to see if it was still there in the store room and we'd put down another $2 till it was paid off. Stores are again pushing the layaway plans and people are responding.

I followed up with a question: When will you decide how much to spend and what will trigger your decision? Again I was surprised by some rational answers. Most people said they had been holding back for 2 reasons. First, they were uncertain about layoffs and secondly, they always used the year end bonus to pay off the Christmas bills. Most felt that by Christmas they would know if their companies would survive and if they still had a job. Most also said that although year end bonuses were confidential the rumor mill would know by Thanksgiving if they were going to get one and approximately how much.

Ok, very unscientific but I still think, valid information. People are preparing with savings and layaways ahead of time and most feel even though they haven't been spending recently because of uncertainty that they'd have the answers about their future by year end.

How are you and your friends and family preparing for Christmas? I'd like to see if you have similar responses and please let us know. I think there will be a lot of unexpected surprises under the tree this year.

Jim Van Meerten is an investor and shares his opinions on financial matters on Financial Tides and Top Stocks. Please comment below or email to

Tuesday, October 6, 2009

FluMist -- Profits up the nose

The whole world seems to be fixated on the economy and the H1N1 Swine Flu. News reports today that the first shipments of the nasal version of the vaccine, manufactured by MedImmune a unit of AstraZeneca, will begin today pushed me to find out if there might be an investing play in this fear. The major manufacturers of the vaccine are GlaxoSmithKline (GSK), Sanofi-Aventis (SNY), Novartis (NVS), AstraZeneca (AZN), Baxter Intl (BAX) and CSL Ltd (CMXHF). None of these are pure plays. Each of these companies has a stable of drugs and products so you are really buying a basket of widely varied profit centers. How do I find the best one?

First, I always go to BarChart for technical analysis to find which stock is moving right now. BarChart uses a combination of 13 different technical analysis indicators and then uses an average to see which has the most votes. The ratings were from a low for AZN of 40% SELL to a high for NVS with a 96% BUY, so for me it's easy to see which one warrants further review.

Monday, October 5, 2009

TARP recipients abuse the public

Over the weekend Chris Adams who writes for the McClatchy Newspapers had 2 powerful articles named Help with mortgages is difficult to come by and Some firms with spotty pasts get tax dollars. In these articles he exposes how firms like Bank of America, Citigroup and Morgan Stanley; firms who were bailed out from the brink of bankruptcy by TARP with billions of taxpayer dollars are now abusing mortgage borrowers who are in trouble. The Treasury is doing little, if anything to monitor the situation.

In one case Ronnie Fruia was about to lose his home when he and his mother and son were all in the hospital. He was in the hospital recovering from a stroke, couldn't even talk but CitiFinancial sent a guy to his room to sign modification papers that didn't even cut his interest rate. State regulators had to step in to get his rate changed from 11.5% to a reasonable 5%.

Deletions to model portfolios

Last week the market was down a little and a few of my holdings tracked below their 50 Day Moving Average and didn't look like they would recover so we trimmed them out. BarChart links included below. The changes are :

Sold all these positions:
S&P 500 Fund -- Fiserv Inc FISV
S&P 400 Fund -- Dycom Ind DY, Temple Inland TIN
S&P 600 Fund -- Arris Group ARRS
New High Fund -- Amer Electric Power AEP
Strategy Lab Fund -- Clearwater Paper CLW

No Changes to the Short Fund - big surprise???

Since the Value Line Index was down 3 straight days in a row last week and is trending below its 20 DMA I won't replace any positions until I see it trending above its 20 DMA again. If today is another down day I will add some short positions to my Short Fund.

Jim Van Meerten is an investor who give financial opinions on Financial Tides, MSN Top Stock Blog and Seeking Alpha. Please give your comments below or email

Disclosure: I do not hold positions in any of the stocks mentioned in this posting.