For some reason I just am not in the 50 point cut camp like most folks are. As a matter of fact, as I speculated last week, I’m not even sure I think a 25 point cut will happen. Why? Today’s reports show the the current economic situation isn’t nearly as dire as people […]

For some reason I just am not in the 50 point cut camp like most folks are. As a matter of fact, as I speculated last week, I am not even sure I think a 25 point cut will happen.

Why? Today’s reports show the the current economic situation isn’t nearly as dire as people think.

Productivity in the nonfarm business sector increased at a 6.3% annual rate in Q3 the government said in its second estimate of productivity. A month ago, the government said productivity rose 4.9% annualized.

Unit labor costs, a key gauge of inflationary pressures from wages, were revised much lower, showing a 2% annual decline in the third quarter compared with a 0.2% drop estimated a month ago.

Unit labor costs in the second quarter were also revised much lower, from a 2.2% gain to a 1.1% decline, reflecting more up-to-date compensation information. The revised data show inflationary pressures from tight labor markets are much milder than previously believed.

Now this does give the Fed room to move rates lower and relieves the worry that inflation may spike. But, with the economy going at a healthy pace, are rate cut really even necessary?

Consider this day jobs report.

Private payrolls grew by 189,000 in November following a revised 119,000 gain in October an ADP report said today. The increase was well above expectations for job growth of only 60,000 in November.

Employed workers are spending workers. Now, much of the rate cut talk has been focused around mortgages. The easy explanation was that millions of resets of adjustable rate mortgages were coming and high rates woulds cause high resets and million of foreclosures. The argument was that lower rates would help mitigate that. Word today is that Treasury Secretary Hank Paulson is working on a deal to freeze resets for 5 years. If that happens, then we now know the scope of the problem out for the next 5 years. We can assume based n historical data what will happen in the mortgage markets with some degree of accuracy.

If we know the scope of the problem, the impetus to lower rates to stave off a catastrophe is now gone. With that being gone, we now go back to the old fashioned reason for rate cuts, growth vs inflation. Right now, both seem to be just fine and if they are just fine, is there really a reason to tinker with rates?

While I do not feel a cut is necessary, with the market 100% sure a 25 point cut is coming, I would assume Bernanke gives it to them if for no other reason that to avoid an end of years sell-off.

Should he give them 50, the only thing that would justify it would be an accompanying statement saying the Fed is essentially “done” unless things “dramatically deteriorate”. Either way, Tuesday will be one hell of a day

For more visit Source:www.straightstocks.com

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Circuit City (CC) has now regressed into the guy in high school that dumps his girlfriend only to beg her to come back after he realizes what a massive mistake he made. Circuit City Spokesman Bill Cimino stated last week that Circuit City invited former U.S. workers to apply for jobs, a practice he stated was […]

Circuit City (CC) has now regressed into the guy in high school that dumps his girlfriend only to beg her to come back after he realizes what a massive mistake he made.

Circuit City Spokesman Bill Cimino said last week that Circuit City invited former U.S. workers to apply for jobs, a practice he stated wasn’t uncommon in retail, given the typically high turnover. It should be noted here that many of these folks are that same ones that in March, Circuit City let go. More than 3,000 workers were fired and replaced them with lower-paid staff. Cimino added that Circuit City would likely invite more ex-staffers to return next year.

“In a lot of cases, we’ve completely changed how our stores operate; the roles of our associates within the stores,” Cimino told Reuters. “We’ve got a superior career path now for associates.” By career path do you mean you’ll not fired them unexpectedly?

Now, what does Circuit City really hope to accomplish? The good one they let go because the were “too expensive” will already have jobs and those who are still unemployed 6 months after they were let go, do they really want them back? The timing of this is terrible too. They now have themselves competing with the holiday hiring spree that happens every years in retailing.

This is just another in a long line of management failures that has shares snuggled comfortably at 4 year lows. There has been a lot of speak in the blogsphere about shares being a bargain and by most mathematical metrics, they are. Big problem though. In order for those metrics to translate into a retail turnaround and thus have shareholders reap the benefits of that value, management needs to do its job.

Circuit City could carve itself out a niche among the monsters out there like Best Buy (BBY) and Wal-Mart (WMT) much like Julian Day at RadioShack (RSH) has done. It would need to be done on service and a more professional shopping experience. Getting rid of the best folks you’ve to do that based on their pay scale was just inexplicably short-sighted.

If current management has shown anything, they are just not up to the job and until new management is there, Circuit City will continue to be a value-trap for investors that if it is not bought out soon (next 8 months), will most likely be driven into bankruptcy a sentiment I first expressed in June.

On a side note, why haven’t any of these electronics retailers with “help desks” inside like City’s “Firedog” or Ideal Buy’s “Geek Squad” jumped at the opportunity to associate somehow with the hit show “Chuck”? It is a natural association.

For more visit Source:www.straightstocks.com

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I mentioned in an entry in mid October how Indian stocks seemed to be getting very tiny attention I’m always amazed to see how the ratio of Chinese to Indian financial stories is in a ratio of 20:1 - when you’ve 2 economies of similar scope, size, and strength - yet one seems to […]

I mentioned in an entry in mid October how Indian stocks seemed to be getting very tiny attention

I am always amazed to see how the ratio of Chinese to Indian financial stories is in a ratio of 20:1 - when you’ve 2 economies of similar scope, size, and strength - yet one seems to get all the attention. Perhaps it is due in part to the fact that there are very few ways of directly investing in India via ADRs where there are several more Chinese avenues.

With all the attention on Chinese small cap stocks racing hundreds of % for no good reason, and the first trillion dollar company, PetroChina (PTR) [Petrochina the 1 Trillion Dollar Company? Is *this* the Top]. it just seemed way too frothy, so I decided to focus more on India instead of China [Buying a Bucket of India]

I decided to look back since that focus on India vs China (October 15/16) and see how investments in the 2 countries have compared since my Indian stocks have been rip roaring of late. I’m using iShares Xinhau China 25 (FXI) as the proxy for China since this is the easiest way for US investors to buy an ‘index’, and using the India Fund (IFN) which is what I use as my index for India.

It is hard to read the chart from afar (click on it to enlarge), but the 2 month chart above starts on October 11th through yesterday’s close. Using October 16th as a begin point, India Fund [tan line] has returned +24% and iShares Xinhau China 25 [black line] -6%, so a variance of +30%. Every so often you nail these….

(as an aside iPath MSCI India (INP) has done even better than IFN - returning 39% since October 16th, but part of that could be due to some structural issues the instrument)

At this point I think the move here in the Indian stocks are a bit overextended, and if not for the fact Chinese big caps are STILL extremely highly valued compared to similar peers in US, I’d be getting more constructive on China. (reversing the call in mid October) Well that and the fact Shanghai is in a bubble and food inflation is roaring there.

Pork prices surged 56 percent in November from a year earlier, driven by a shortage of pigs. Food makes up a third of the consumer price index and rising costs pose a threat to social stability, illustrated by a stampede last month at a cooking-oil sale that killed three people in the central city of Chongqing. Overall, food climbed 18.2 percent.

However this shows clearly that not all ‘emerging markets’ move together… while both countries were hit by the US correction in November, the Chinese index has made a begrudging recovery whereas the Indian stocks have made a slingshot bounce.

Long India Fund in fund; no personal position

For more visit Source:www.straightstocks.com

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On Tuesday afternoon, I was out Christmas shopping and I heard Jeff Macke (spelling?) make a comment to the effect he sold a lot of stock as a result of the first bit of Fed news. Gartman on Wednesday stated the he thinks the rest of the year will be down and that he has lost […]

On Tuesday afternoon, I was out Christmas shopping and I heard Jeff Macke (spelling?) make a comment to the effect he sold a lot of stock as a result of the first bit of Fed news.

Gartman on Wednesday stated the he thinks the rest of the year will be down and that he has lost all faith in Bernanke and thinks he should go.

I’ve been clear for many months that I thought that this market cycle was close to ending and that in fact a bear market has started.

My thought of course should have no bearing on you and your portfolio. The context here’s if you think a bear market or big decline is coming…

I’ve outlined the general tact I’ve taken, and why, in past posts. As a matter or normal cyclicality, volatility increases at the end. For anyone interested in trying to avoid some portion of down a lot it makes sense to reduce volatility a little if the chance of it being late cycle is high.

In looking at the chart there are of course different conclusions that can be drawn. I believe the green line will turn out to be the most important but whether that’s true or not I don’t believe anything changed this week with the Fed news. Bear markets turn slowly, as I’ve been saying, they do not start with one news item like the Fed did X. The Fed could make things worse however.

Financials have been in trouble for months now and as I have been saying I anticipate more to come. A stock market is very unlikely to do well without its largest sector. This entire event from the first yield curve inversion through to the present day has been very textbook. Here I’m speaking about the effect of the crisis as opposed to the details that created the crisis.

The news of the week is simply a part of the equation that either the Fed is behind the curve or there’s no real action to solve this other than time. We know that if nothing else time will solve it, we don’t know how much time (at least I don’t) it will take.

The path I chose (and wrote about) was simple and relied on this time not being different. Inverted yield curve equals trouble for financials and probably for the rest of the market. Anticipating trouble meant trying to avoid the full impact of a normal decline.

Looking ahead there is no way to know (we may look back and point to a certain date) whether in fact a bear market has started or whether any action taken to cushion the blow will work if it is a bear but bear markets do come along each now and then and the way they begin is pretty similar to what is going on now. I may be adding 1+1 and getting eleven or I may be right but I can build a good case personally that says some defense here makes sense. So far this path has worked very well and we’ll see about the future.

For more visit Source:www.straightstocks.com

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For some reason I just am not in the 50 point cut camp like most folks are. As a matter of fact, as I speculated last week, I’m not even sure I think a 25 point cut will happen. Why? Today’s reports show the the current economic situation is not nearly as dire as people […]

For some reason I just am not in the 50 point cut camp like most folks are. As a matter of fact, as I speculated last week, I am not even sure I think a 25 point cut will happen.

Why? Today’s reports show the the current economic situation isn’t almost as dire as people think.

Productivity in the nonfarm business sector increased at a 6.3% annual rate in Q3 the government stated in its second estimate of productivity. A month ago, the government said productivity rose 4.9% annualized.

Unit labor costs, a key gauge of inflationary pressures from wages, were revised much lower, showing a 2% annual decline in the third quarter compared with a 0.2% drop estimated a month ago.

Unit labor costs in the second quarter were also revised much lower, from a 2.2% gain to a 1.1% decline, reflecting more up-to-date compensation information. The revised data show inflationary pressures from tight labor markets are much milder than previously believed.

Now this does give the Fed room to move rates lower and relieves the worry that inflation might spike. But, with the economy going at a healthy pace, are rate cut really even necessary?

Think about this day jobs report.

Private payrolls grew by 189,000 in November following a revised 119,000 gain in October an ADP report said this day. The increase was well above expectations for job growth of only 60,000 in November.

Employed workers are spending workers. Now, much of the rate cut speak has been focused around mortgages. The simple explanation was that millions of resets of adjustable rate mortgages were coming and high rates woulds cause high resets and million of foreclosures. The argument was that lower rates would help mitigate that. Word this day is that Treasury Secretary Hank Paulson is working on a deal to freeze resets for 5 years. If that happens, then we now know the scope of the problem out for the next 5 years. We have the ability to assume based n historical data what will happen in the mortgage markets with some degree of accuracy.

If we know the scope of the problem, the impetus to lower rates to stave off a catastrophe is now gone. With that being gone, we now go back to the old fashioned reason for rate cuts, growth vs inflation. Right now, both seem to be just fine and if they’re just fine, is there really a reason to tinker with rates?

While I do not feel a cut is necessary, with the market 100% sure a 25 point cut is coming, I would assume Bernanke gives it to them if for no other reason that to avoid an end of years sell-off.

Should he give them 50, the only thing that would justify it would be an accompanying statement saying the Fed is essentially “done” unless things “dramatically deteriorate”. Either way, Tuesday will be one hell of a day

For more visit Source:www.straightstocks.com

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The Fed’s announcement of a “term auction facility” (TAF) caught the market by surprise this morning, despite the advance leak of likely moves which we reported yesterday.  Those unwilling or unable to trade in the off-hours market missed the huge initial rally. We think the timing of the Fed action significantly colored market reaction.  Traders were […]

The Fed’s announcement of a “term auction facility” (TAF) caught the market by surprise this morning, despite the advance leak of likely moves which we reported yesterday.  Those unwilling or unable to trade in the off-hours market missed the big initial rally.

We think the timing of the Fed action significantly colored market reaction.  Traders were justifiably unhappy over the Fed’s lack of attention to the market impact.

Why the Sloppy Timing?

Traders, especially those who had stopped out positions or gone short, assigned various reasons to the Fed’s timing.  Some thought they were reacting to Tuesday’s selling with a hastily created plan.  Others emphasized the lack of attention to markets.

We think that this reads too much into the timing of the Fed policy announcements. Government organizations follow set procedures. The FOMC releases a statement that follows a pattern. It is not their normal automobile for other announcements, so they did their standard thing.

Also, as we noted in our comments yesterday, they were probably surprised by the market reaction. They were taking an action that was in line with publicized majority expectations.  James Hamilton has an especially good analysis of these expectations, with a careful look at fed fund futures.  (Hamilton’s work, along with co-writer Menzie Chinn, is a consistent source of thoughtful economic reasoning).
Obviously the announcement timing could have been better coordinated. The fact that it involved several countries was a factor in making a joint announcement.  The proposal was following a separate track from the interest rate cuts.  It required a vote at the meeting and a coordinated press release which had actually was determined a week ago.
Much of what happens in government is the result of organizations following standard procedures, not the result of some unitary planning.  Traders tend to think of government action as following the reasoning and speed they would use in their own decisions.  This isn’t realistic.

The Policy Substance

Traders, fund managers, and pundits are almost universal in their criticism of the Fed action.  They would have preferred a bigger rate cut, a policy with a clear-cut interpretation and market reaction.  Leading critics, including the influential media personalities Jim Cramer and Larry Kudlow, are skeptical of the Fed move.  They believe that the Fed is responding in an academic fashion to real-world issues.

Should we be surprised that many astute economic observers disagree with the traders?  The consensus of their thinking is that the Fed action is more targeted than a general rate cut.  Here are some typical responses:

Mark Thoma writes, “The Fed has now taken another creative, and likely useful step in getting liquidity to the “choke points” outside the traditional banking system…”  This is something that he has highlighted as a problem.

Felix Salmon points out the unique feature of the TAF program, that the Fed is accepting a wide range of collateral.

Steve Waldman thinks the TAF is a “really, really huge deal.”  In widely-cited comments he points out several advantages over other bailout-style plans.

Greg Ip explains the nuts and bolts of the proposal in his typical clear and incisive fashion.

James Hamilton correctly views this as an “improved discount window” and looks at the possible effect on illiquid assets.

The Public Policy Viewpoint

There are few experts in public policy commenting on this.  Since that’s our sweet spot, we shall offer some observations about how government handles complex problems.

What we will see isn’t a coordinated master plan, but  a patchwork of actions where each addresses one aspect of the problem.  Different agencies are responsible for different pieces.  The Paulson plan, for example, goes after one small aspect of the problem, and it does so without requiring legislation.

A few months ago the Fed attempted to encourage use of the discount window and accepted new forms of collateral.  It did not work, so they’re trying something else.  There are some who believe that a massive part of the problem is getting existing liquidity where it is needed.  If the Fed plan works, it will reduce LIBOR and the TED spread. Since LIBOR affects many loans and mortgages, this would be a good result.  It may also help the market for mortgage securities.

We do not know if this plan will work and neither does the Fed. Governments move incrementally, using trial and error.  While we traders think of a day as a long time, government agencies have a absolutely different time frame.  The agreement announced this day probably took months to plan and negotiate.  For government, that is fast work!

What We Like

There are lots of good features of this proposal.

It is targeted.  It helps the TED spread.  It gets CMO’s in the market.  It opens liquidity for many banks that would otherwise be shut off.

It is expandable.  Some have criticized the initial size of the offerings.  These will change rapidly if the facility works.

It is flexible.  It can be modified or abandoned if it does not work.

It shows commitment.  This innovative approach shows that the Fed isn’t “behind the curve.” The proposal is certainly not a complete solution, but it was not intended as such.  If this does not work, the Fed will try something else.

Conclusion

We think that the new policy might show some results in the first auctions, leading to a positive market reaction.  Everyone is so negative, it is a good time to embrace the possible.

For more visit Source:www.straightstocks.com

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On Track Innovations Ltd.  (OTIV ), a global leader in contactless microprocessor-based smart card solutions for homeland security, payments, petroleum payments other applications and machinery, announced disappointing earnings earlier this day. This is not the first bad quarter investors have been subject to. Revenues came in lower than expected and the company suffered a much larger […]

On Track Innovations Ltd.  (OTIV ), a global leader in contactless microprocessor-based smart card solutions for homeland security, payments, petroleum payments other applications and machinery, announced disappointing earnings earlier today. This is not the first bad quarter investors have been subject to. Revenues came in lower than expected and the company suffered a much bigger loss than expected.

Commenting on the results, Oded Bashan, Chairman and CEO said, “Although this isn’t always reflected in our financial results, we are making progress in the overall business. The number of projects in the pipeline have increased, the big projects we’re involved in are progressing, and we are introducing new products and expanding our IP.”

Mr. Bashan, if it’s not reflected in your financial results, how would we know that the business is “making progress?” For investors, the proof is in the pudding. It’s like saying the win-less Miami Dolphins are getting much better, although they still haven’t won  a single football game this season.  Who cares. Sorry Zack, I couldn’t resist. There will be no getting Jiggy with this stock!

Since late April the stock price has been cut in half. With shrinking margins and lower revenues, no matter how good the technology is and how big your pipeline is, this seems like a second half 2008 story at best. I’ll add that the one interesting fact here’s that they have a strong balance sheet and $40 million in cash, with a total market-cap of $80 million.

For more visit Source:www.straightstocks.com

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On Track Innovations Ltd.  (OTIV ), a global leader in contactless microprocessor-based smart card solutions for homeland security, payments, petroleum payments other applications and machinery, announced disappointing earnings earlier today. This isn’t the first bad quarter investors have been subject to. Revenues came in lower than expected and the company suffered a much bigger […]

On Track Innovations Ltd.  (OTIV ), a global leader in contactless microprocessor-based smart card solutions for homeland security, payments, petroleum payments other applications and machinery, announced disappointing earnings earlier today. This is not the first bad quarter investors have been subject to. Revenues came in lower than expected and the company suffered a much bigger loss than expected.

Commenting on the results, Oded Bashan, Chairman and CEO stated, “Although this is not always reflected in our financial results, we’re making progress in the overall business. The number of projects in the pipeline have increased, the large projects we are involved in are progressing, and we are introducing new products and expanding our IP.”

Mr. Bashan, if it’s not reflected in your financial results, how would we know that the business is “making progress?” For investors, the proof is in the pudding. It’s like saying the win-less Miami Dolphins are getting much better, although they still haven’t won  a single football game this season.  Who cares. Sorry Zack, I couldn’t resist. There will be no getting Jiggy with this stock!

Since late April the stock price has been cut in half. With shrinking margins and lower revenues, no matter how good the technology is and how massive your pipeline is, this seems like a second half 2008 story at ideal. I will add that the one interesting fact here is that they have a strong balance sheet and $40 million in cash, with a total market-cap of $80 million.

For more visit Source:www.straightstocks.com

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Jones Soda Co. (JSDA) today announced that Peter van Stolk will step down from his position as chairman of the board of directors and as chief executive officer at the end of the year. He’ll remain on as a member of the board of directors. Board members Scott Bedbury and Steve Jones will take on […]

Jones Soda Co. (JSDA) this day announced that Peter van Stolk will step down from his position as chairman of the board of directors and as chief executive officer at the end of the year.

He’ll remain on as a member of the board of directors. Board members Scott Bedbury and Steve Jones will take on the interim positions of chairman and CEO respectively while the company conducts a search for a new CEO.

“As I said earlier this year, I planned to step down at the end of 2007,” stated van Stolk. “I’ve worked hard this past year to lay the foundation for future growth with an increased product line and national distribution at the retail level. Recruiting a strong and seasoned CEO is the next step in that process, and utilizing the experience of Scott and Steve in that effort will help ensure a successful outcome. During the up coming weeks, I will be focused on the transition and look forward to working with the board to continue to grow the company to bring it to its full potential.”

“It has been a true honor being so intimately involved with such a special Company like Jones Soda,” stated van Stolk. “Over the past 11 years the Company has grown from a small niche player in the beverage industry into a leading brand with national recognition and powerful portfolio of products. Jones Soda’s success to-date is directly related to the dedication and commitment of its employees and I have been privileged to have worked with an astounding group of extremely talented and passionate people. I’m confident that the company is in excellent leadership hands with Scott and Steve until a new CEO is appointed and I look forward to remaining involved as a board member.”

“Peter has established himself as one of the most successful visionaries and innovators in the beverage business,” Bedbury said. “We are fortunate to have him continue as a member of the board of directors and to help us build shareholder value well into the future.”

Steve Jones spent 17 years with The Coca-Cola Company serving most recently as the corporation’s chief marketing officer and CEO of The Minute Maid Company. Previously Steve had two international operating leadership assignments, first in Great Britain and then as head of Coca-Cola Japan, which is regarded to have one of the most diverse product portfolio and innovative product development approaches in the industry. Jones’ career includes numerous progressive brand management roles in Canada and the U.S., including being brand manager of diet Coke during the brand’s early development stage. As Chief Marketing Officer, Steve was instrumental in reshaping Coke’s contemporary brand relevance around the globe and developing and introducing a strategy to broaden the company’s portfolio that led to the launch of several new products in key markets around the world.

“Steve has been a tremendous asset to our board and brings a wealth of operating, marketing and brand management to the CEO position at a key period for the company,” said Bedbury. “Moving from a niche player to a mainstream brand is a challenging time for any company. I’ve been a part of that process for both Nike and Starbucks, and am confident that Jones Soda will become a highly successful and profitable global brand.”

Scott Bedbury is currently CEO of Brandstream, Inc. an independent brand development consultancy he founded in 1998. Shortly after joining Nike in 1987 Bedbury launched the “Just Do It” campaign, helping take what had been a narrowly positioned brand to number one worldwide. Bedbury joined Starbucks in 1995 as senior vice president of Marketing and Brand Development and oversaw the repositioning of Starbucks as a comfortable, convenient and welcome “third place” between home and work. Bedbury worked closely with CEO Howard Schultz to navigate Starbucks’s growth from several hundred stores to several thousand in three years, and to open its first overseas markets. Bedbury is also the author of “A New Brand World,” published by Viking Press.

Headquartered in Seattle, Washington, Jones Soda Co. manufactures its products and sells them through its distribution network in choose markets across North America. A leader in the premium soda category, Jones is known for its innovative labeling technique that incorporates always-changing photos sent in from its consumers. Jones Soda is sold through traditional beverage retailers and everywhere you’d never anticipate to find a soda.

For more visit Source:www.straightstocks.com

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My early September entry ‘12 Stocks to Purchase on the next Pullback’ has been one of the more popular entries on the blog in its entire history. Since we are now a quarter later, and a lot more info has emerged since, I want to update this entry with a new set of choices for […]

My early September entry ‘12 Stocks to Buy on the next Pullback’ has been one of the more popular entries on the blog in its entire history. Since we are now a quarter later, and a lot more info has emerged since, I want to update this entry with a new set of choices for the coming months.

With the markets at a precarious perch, just below major resistance but certainly with the help of the ‘invisible’ hand could be pushed back above… but assuming the prospects of a Fed with their hands tied by the twin towers of inflation and slowing growth, let’s assume some pullback is coming. What are the most interesting sectors that would be enticing on a pullback? Please note the above list only contains stocks that have yet to ‘correct meaningfully’.

Last time around I focused on the following sectors with a top down approach: (less cyclical) oil service, deep sea oil drilling, solar power, networking, techology - other, global infrastructure, global agriculture, china, and retail.

Many of these same sectors strike my fancy

(Less cyclical) Oil service
I still like this area but aside from National Oilwell Varco (NOV) most still trade below a major resistance area (50 day moving average), so NOV quickly becomes *the* pick as it has recently broke out to $78. A pullback to its 50 day moving average near $71-$72 area would be enticing.

Deep Sea Oil Drilling
This whole group has broken out so it’s a perfect candidate for this sort of “buy on the next pullback” review. With GlobalSantaFe (GSF) now off the table after its merger with Transocean (RIG), we have RIG, Atwood Oceanics (ATW), or Diamond Offshore (DO) as our choices. I prefer the latter two as more of pure plays in deep sea and less on rigs closer to shore… Diamond Offshore has 50 day support in the mid 110s, and Atwood Oceanics around $83. Pick 1.

Solar
A group on FIRE…. the easiest choice in terms of ’safety’ and knowing what you’ll get is Suntech Power (STP). It currently trades at $83, and its 50 day moving average is way down there at $63, so it would take quite a calamity to correct that far. With stocks in such strong uptrends, I try to buy at least a beginning position at the 20 day moving average (currently $75) and then cross fingers for more weakness to add to it. Even with it’s huge move, it is still cheaper than its American counterpart Sunpower (SPWR). First Solar (FSLR) is another candidate but with ‘potential’ for some slower 1st half 2008 guidance due to capacity constraints and a stock priced for more than perfection it might not be the safest to hold going into the next earnings with an investor base that demands perfection.

There are numerous more speculative fare in this sector - literally throw a dart and you hit a stock making a big move.

Technology - Other
Out of all the teflon stocks - Google (GOOG), Apple (AAPL), Research in Motion (RIMM), Baidu.com (BIDU), Apple and Baidu.com have held up the ideal in the past week or two. With the clarity of the Apple roadmap, it just seems too good to pass up. We currently have Apple in the low $190s; any gift such as a pullback to the 50 day moving average ($174) would be very enticing - this will be an Apple Christmas

Global Infrastructure/Energy
I follow 7 names in this sector - the ideal relative strength has been shown by Foster Wheeler (FWLT), Jacobs Engineering (JEC), and Chicago Bridge & Iron (CBI). Literally throw a dart, pick 2, and hope for a pullback to their 50 day moving averages. These stories will be playing out for years, even as investors switch from 1 to another on their short sighted focus simply on the next quarter.

Agriculture
I like fertilizer so much, I’d state pick 2 names - my stocks have been Mosaic (MOS), Potash (POT), and CF Industries (CF). Again, hope for a pullback to their 50 day moving averages (which they did pull back to in November), and this is where we’d want to be buying. Another multi year bull market. The fertilizer side has been much stronger than the equipment side (i.e. tractors) of late.

Financials
Yes you heard me. We’ve two beauties in Blackrock Financial (BLK) and Mastercard (MA). The more messy things get in the financial world, the more business that seems to be flowing to the former, and the more the world goes to plastic the more the latter benefits. If one likes to be in the asset manager business they have the ability to go with Blackrock; if one likes ‘transactions’ they have the ability to go with Mastercard. With Mastercard in the $220s and its 50 day moving average around $183, if the market would correct, this would be currently my choice of these 2.

At this point I don’t see any sufficient names in China, or retail, or networking (areas I covered last time around) so I will have to find 3 new names/sector

Coal
I’ve been a huge bull on this sector for months. We have multiple domestic names - really pick your poison among Peabody Energy (BTU), Consol Energy (CNX), or Massey Energy (MEE). I’d be adding heavily to all of these on a pullback to the 50 day moving averages as we’ve the quietest bull market on the street developing

Foreign non China/India
Two picks here I really like - if mining is more your bent, Mechel (MTL) the Russian coal/iron/steel maker continues to impress. If energy is more your thing we have Brazilian oil giant Petrobras (PBR). Both have pulled back from recent highs, Petrobas at $108 is 14 points above its 50 day moving average of $94. $94 is also where the stock bottomed out in the November correction so we have the ability to hope for a pullback to that level (hope being operative word). Mechel has swiftly pulled back from >$100 to $94, just a bit above its 20 day moving average of $90. It’s 50 day moving average is in the upper $70s and rising quickly so we can hope for a pullback there. Almost made the cut: Millicom International Cellular (MICC), but some slowdown in Latin America cell sales could be an issue - have to monitor this one closely.

India
While Chinese stocks have suffered of late, India has propsered. While I think this recent run needs some correction, that’s exactly what we are hoping for. Multiple picks in India - one can go with the banking sector and find a HDFC Bank (HDB) or ICICI Bank (IBN), or if one wants a more industrial bent there’s copper stock Sterlite Industries (SLT). All 3 names have corrected a bit to their 20 day moving averages but still are far above the 50 days. Pick 1.

******
So there’s a quick and dirty overview of a new dozen…. all made tremendous runs of late when the market was up 5-6% from November lows, and most are holding their own in this post Fed weakness; but if the markets wake up to the fact of potential recession, growing inflation, credit crunch and weakening profits (what a combo!) - the above groups should see correction and make for solid buying opportunities. And if you want to benefit from a coming correction, may I suggest some Ultrashorts…. but that’s another post.

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