Working to summarize the blog on this topic from http://seekingalpha.com/article/193345/comments?v=1268663941&source=tracking
------
I'm a swing trader, so I do not pay much attention on dividends. However, I feel there is a place in our portfolio and do not have to sell them (just pass them to our heirs). Here are some random thoughts.
----
From my own research via over 250 searches (one search is one screen) and over many simulations (one simulation running all 250 searches for a period), dividend-growth stocks are never in the top-performing 10% in all phases of the market cycle. Yes, dividend-growth stocks should indicate a company is successful, but also indicates the company does not know how to re-invest the money (debatable). One man's research.
Total Return = Stock Appreciation + Dividend - Taxes
The simulations may miss the dividend part, so I need to add about 2% for the return for these stocks.
Taxes are more complicated as long-term and short-term appreciations and dividends could be different. Your state residence and your tax bracket make a difference too. The winning stocks will have the cost basis step down to the day you die, so most likely it is a tax advantage.
----------
Diversify as most bank stocks belong to this group before the crash.
---------
Hints from another investor:
So my conclusions/summary so far is:
1) Can't guess the market's direction.
2) For the average guy like me who can't pick stocks or time market, over the long term Div Growth Stocks are the best place to be.
3) Preferably buy them when their evaluation vs others in sector and their sector vs other sector's evaluations are low (out of favor) and the collary, sell them when both evaluations are high (when they are darlings).
4) Diversify into several div growth stocks, (I'm Canadian but live in Houston and when retire will probably be in Canada with travel in Europe and Asia and thus should diversify out of US into several countries or in global companies).
5) When possible, avoid the big failures like GE & C.
(Any corrections appreciated)
------------
It is not hard to write a search on the stocks that increase dividend yield every year.
Tuesday, March 16, 2010
Wednesday, March 3, 2010
Coming crisis
If history teaches us anything, it’s that when even ONE major government defaults on its debts, economic chaos follows. Unfortunately, it’s a lesson that few investors have learned.
The truth is, when investors even suspect that such a thing could happen, the economic damage can be crippling. The following crisis unfolds in four, quick steps:
FIRST, since a sovereign debt default would inevitably cause ALL bonds to crash, investors stampede for the bond market exits, dumping as much as they can as fast as they can.
SECOND, as the bond market reels, interest rates skyrocket and credit tightens. The rates on 30-year fixed-rate mortgages, auto loans and other long-term debts soar. Rates tied to short-term money markets — on credit cards and variable mortgages — follow.
THIRD, consumers — whose spending represents fully 70% of the economy — snap their pocketbooks shut.
FOURTH, corporate earnings and stock prices crater. As the economy hits the skids, unemployment soars.
Clearly, these events would be the coup de grâce to an economic recovery as fragile as this one is.
They would almost surely transform a Great Recession into a Great DOUBLE-DIP Recession ...
Plunging us into the second bear market in three years ...
Lighting the fuse on a second explosion in unemployment, and ...
Triggering a second surge in personal and corporate bankruptcies.
Indeed ...
This disturbing scenario is already
beginning to unfold before our very eyes —
not just in ONE major Western country,
but in TEN of them!
We’ve known for some time that Italy and Ireland are at risk for default — and just this week, we saw how investors’ fears have caused them to begin dumping British pounds and gilts (bonds) like there’s no tomorrow.
Plus, the soaring cost of Credit Default Swaps — “insurance policies” that protect investors against default — on the debt of Greece, Portugal, Romania, Lithuania, Latvia, Iceland and the Ukraine is a clear sign that investors believe they are also at elevated risk of default.
Put simply, it would only take ONE sovereign debt default to crush this anemic recovery ... but no fewer than TEN major Western countries are now at risk!
What’s more, no fewer than THREE powerful forecasting tools are confirming that a great bond market conflagration, stock market decline and double-dip recession are now on the horizon ...
CYCLICAL ANALYSIS CONFIRMS IT: The cycles identified by the Foundation for the Study of Cycles have accurately anticipated nearly every major shift in market direction ... in every major asset class ... in advance ... for 39 years.
* And now, as the Foundation’s Research Director, Richard Mogey and I demonstrated in Nine Shocking New Forecasts for 2010-2012, the current cyclical analysis is confirming that a major new decline in the economy is coming later this year.
* U.S. stocks will decline starting this year and continue falling in a zigzag pattern through 2012.
* The U.S. dollar index may continue to firm somewhat as the European debt crisis drives investors into dollar-denominated investments. But then the greenback will collapse until late 2011 as the U.S. sovereign debt crisis runs its course.
* Serving in its capacity as a global crisis hedge, gold will skyrocket FAR higher than $2,000 per ounce by the end of 2011.
* Crippled by soaring interest rates due to the U.S. debt crisis, our economy will suffer a devastating double-dip recession in 2011.
POLITICAL ANALYSIS CONFIRMS IT: If the rise of the Tea Party movement or the results of recent elections in Massachusetts mean anything at all, it’s that many Americans are fighting mad.
They’re fed up with Washington’s bailouts of failed bankers and CEOs ... skyrocketing federal deficits and debts ... out-of-control borrowing by the Treasury ... mindless money-printing by the Federal Reserve ... and now, the specter of higher taxes ahead.
The handwriting is on the wall: With midterm Congressional elections only seven, short months away, any politician who votes for more of the same is practically begging to be thrown out of office.
That means the days of Washington bailouts and stimulus are numbered. And that, in turn, means that the momentary economic stability which that spending bought will soon come to an end.
VOLATILITY ANALYSIS CONFIRMS IT: Right now, the volatility indicators professional traders rely on — in the bond market ... in currencies ... and more — are signaling that the economic stability and investment trends most investors have depended on for the last year or so are coming to an end.
The smart money is now beginning to bet on major directional shifts in all major asset classes — and on the recovery coming unraveling before our very eyes.
Our conclusion is clear:
Huge investment dangers
and enormous profit opportunities
directly ahead!
All of this promises both unprecedented dangers and unprecedented profit opportunities that few investors understand — in every single asset class, including gold, stocks, bonds, currencies and more.
In fact, it’s with precisely this scenario in mind that we created our Million-Dollar Rapid Growth Portfolio: To help you protect yourself and profit in the chaotic days ahead.
Since 1971, the time-honored, scientific research upon which the portfolio is based — from the Foundation for the Study of Cycles — has anticipated almost every major directional shift in stocks, gold, bonds, commodities and currencies.
And based on my analysis of the Foundation’s materials published long before each major market turn, I calculate that, when applied to a diversified portfolio, their research could have helped you ...
* Beat the S&P 500 four to one ...
* Enjoy 18 consecutive winning years since 1992 ...
* Multiply your money more than 25 times over since 1971 ...
* And turn $10,000 into more than $258,000 ... $100,000 into nearly $2.6 million ... or $1 million into more than $25.8 million ...
* In nearly every imaginable investing environment — even as investors who trusted Washington and Wall Street lost their shirts!
In fact, Dr. Weiss is so confident in this revolutionary approach to building the optimal growth portfolio, he’s putting his money where his mouth is, using this strategy to invest $1 million. And I am personally investing some of my funds as well.
The best part: The Weiss Million-Dollar Rapid Growth Portfolio gives you the opportunity to invest your money the way I invest mine, with one major exception:
You can actually beat us to the punch by getting two full business days’ notice before we buy or sell anything!
The sheer size and power of this great debt crisis make this the ideal time to begin trading
a rapid growth portfolio.
In fact, I’m already eyeing an ingenious trade that’s designed to profit BOTH when the euro collapses AND when gold prices explode! I’ll give you explicit instructions on precisely how to make this trade.
And in each Trading Alert I send you, I will ...
* Name the asset classes the Foundation’s signals have identified as having the richest profit potential now ...
* Reveal what percentage of our capital I’ll invest in each asset class ...
* Name the individual vehicles — the stocks and ETFs — I’m recommending in each asset class ...
* Give you the precise percentage of your money to invest in each vehicle.
The truth is, when investors even suspect that such a thing could happen, the economic damage can be crippling. The following crisis unfolds in four, quick steps:
FIRST, since a sovereign debt default would inevitably cause ALL bonds to crash, investors stampede for the bond market exits, dumping as much as they can as fast as they can.
SECOND, as the bond market reels, interest rates skyrocket and credit tightens. The rates on 30-year fixed-rate mortgages, auto loans and other long-term debts soar. Rates tied to short-term money markets — on credit cards and variable mortgages — follow.
THIRD, consumers — whose spending represents fully 70% of the economy — snap their pocketbooks shut.
FOURTH, corporate earnings and stock prices crater. As the economy hits the skids, unemployment soars.
Clearly, these events would be the coup de grâce to an economic recovery as fragile as this one is.
They would almost surely transform a Great Recession into a Great DOUBLE-DIP Recession ...
Plunging us into the second bear market in three years ...
Lighting the fuse on a second explosion in unemployment, and ...
Triggering a second surge in personal and corporate bankruptcies.
Indeed ...
This disturbing scenario is already
beginning to unfold before our very eyes —
not just in ONE major Western country,
but in TEN of them!
We’ve known for some time that Italy and Ireland are at risk for default — and just this week, we saw how investors’ fears have caused them to begin dumping British pounds and gilts (bonds) like there’s no tomorrow.
Plus, the soaring cost of Credit Default Swaps — “insurance policies” that protect investors against default — on the debt of Greece, Portugal, Romania, Lithuania, Latvia, Iceland and the Ukraine is a clear sign that investors believe they are also at elevated risk of default.
Put simply, it would only take ONE sovereign debt default to crush this anemic recovery ... but no fewer than TEN major Western countries are now at risk!
What’s more, no fewer than THREE powerful forecasting tools are confirming that a great bond market conflagration, stock market decline and double-dip recession are now on the horizon ...
CYCLICAL ANALYSIS CONFIRMS IT: The cycles identified by the Foundation for the Study of Cycles have accurately anticipated nearly every major shift in market direction ... in every major asset class ... in advance ... for 39 years.
* And now, as the Foundation’s Research Director, Richard Mogey and I demonstrated in Nine Shocking New Forecasts for 2010-2012, the current cyclical analysis is confirming that a major new decline in the economy is coming later this year.
* U.S. stocks will decline starting this year and continue falling in a zigzag pattern through 2012.
* The U.S. dollar index may continue to firm somewhat as the European debt crisis drives investors into dollar-denominated investments. But then the greenback will collapse until late 2011 as the U.S. sovereign debt crisis runs its course.
* Serving in its capacity as a global crisis hedge, gold will skyrocket FAR higher than $2,000 per ounce by the end of 2011.
* Crippled by soaring interest rates due to the U.S. debt crisis, our economy will suffer a devastating double-dip recession in 2011.
POLITICAL ANALYSIS CONFIRMS IT: If the rise of the Tea Party movement or the results of recent elections in Massachusetts mean anything at all, it’s that many Americans are fighting mad.
They’re fed up with Washington’s bailouts of failed bankers and CEOs ... skyrocketing federal deficits and debts ... out-of-control borrowing by the Treasury ... mindless money-printing by the Federal Reserve ... and now, the specter of higher taxes ahead.
The handwriting is on the wall: With midterm Congressional elections only seven, short months away, any politician who votes for more of the same is practically begging to be thrown out of office.
That means the days of Washington bailouts and stimulus are numbered. And that, in turn, means that the momentary economic stability which that spending bought will soon come to an end.
VOLATILITY ANALYSIS CONFIRMS IT: Right now, the volatility indicators professional traders rely on — in the bond market ... in currencies ... and more — are signaling that the economic stability and investment trends most investors have depended on for the last year or so are coming to an end.
The smart money is now beginning to bet on major directional shifts in all major asset classes — and on the recovery coming unraveling before our very eyes.
Our conclusion is clear:
Huge investment dangers
and enormous profit opportunities
directly ahead!
All of this promises both unprecedented dangers and unprecedented profit opportunities that few investors understand — in every single asset class, including gold, stocks, bonds, currencies and more.
In fact, it’s with precisely this scenario in mind that we created our Million-Dollar Rapid Growth Portfolio: To help you protect yourself and profit in the chaotic days ahead.
Since 1971, the time-honored, scientific research upon which the portfolio is based — from the Foundation for the Study of Cycles — has anticipated almost every major directional shift in stocks, gold, bonds, commodities and currencies.
And based on my analysis of the Foundation’s materials published long before each major market turn, I calculate that, when applied to a diversified portfolio, their research could have helped you ...
* Beat the S&P 500 four to one ...
* Enjoy 18 consecutive winning years since 1992 ...
* Multiply your money more than 25 times over since 1971 ...
* And turn $10,000 into more than $258,000 ... $100,000 into nearly $2.6 million ... or $1 million into more than $25.8 million ...
* In nearly every imaginable investing environment — even as investors who trusted Washington and Wall Street lost their shirts!
In fact, Dr. Weiss is so confident in this revolutionary approach to building the optimal growth portfolio, he’s putting his money where his mouth is, using this strategy to invest $1 million. And I am personally investing some of my funds as well.
The best part: The Weiss Million-Dollar Rapid Growth Portfolio gives you the opportunity to invest your money the way I invest mine, with one major exception:
You can actually beat us to the punch by getting two full business days’ notice before we buy or sell anything!
The sheer size and power of this great debt crisis make this the ideal time to begin trading
a rapid growth portfolio.
In fact, I’m already eyeing an ingenious trade that’s designed to profit BOTH when the euro collapses AND when gold prices explode! I’ll give you explicit instructions on precisely how to make this trade.
And in each Trading Alert I send you, I will ...
* Name the asset classes the Foundation’s signals have identified as having the richest profit potential now ...
* Reveal what percentage of our capital I’ll invest in each asset class ...
* Name the individual vehicles — the stocks and ETFs — I’m recommending in each asset class ...
* Give you the precise percentage of your money to invest in each vehicle.
Thursday, February 18, 2010
Saturday, February 13, 2010
The 3 Waves
Risk Aversion: The Final Wave
by Bryan Rich
Dear Anthony,
Bryan Rich
Over the past months I've written extensively in my Money and Markets columns about the bubbling over of the risk trade. I also warned about the rising threats that would likely make a sustainable recovery, at this point, a low probability.
And as time passes, we're beginning to see that these threats, including a growing sovereign debt crisis, rising protectionism, and threatening asset bubbles, are becoming ripe and dangerous.
But in a world of instant information, it's easy for our focus to be drawn away from the underlying fundamental problems in the world economy ...
It can be difficult to see the forest for the trees when stock markets are rising, commodity prices are recovering and the media is touting hot burgeoning world economies.
Internal Sponsorship
Recovery a major DUD — what to do ...
A shocking new report out earlier this week gives the lie to the government-endorsed myth that the worst is behind us.
Official figures out of Europe show that the Eurozone barely had a pulse. The news from the U.S. wasn't much better: Foreign investors are recoiling in horror from Washington's spending and borrowing spree.
No wonder so many Americans are FED UP with Washington and Wall Street!
Click here to register for our FREE briefing with our NEW predictions for what's ahead ...
But if you step back and examine the activities in the global economy and the global financial markets over the past 2½ years, based on history it looks like the roadmap to sustainable recovery has three waves. And we're likely only two-thirds of the way through the economic drawdown.
Wave #1:
Panic
Wave number one was panic-induced, risk aversion. It was the unraveling of the credit bubble, the seizing of the financial system and the flight of capital from all corners of the world back toward the center (the United States).
Wave #2:
Stabilization
Risk appetite returned when central bankers blanketed the world with easy money.
Risk appetite returned when central bankers blanketed the world with easy money.
The second wave was the eye of the storm. Here, risk appetite bounced back. Global central banks engaged the biggest experiment in history in an effort to stabilize a rapidly deteriorating financial system. In the process, they opened up the money spigot and flooded banks with capital, backstopped failing giants, guaranteed obligations, and printed trillions of dollars.
For many, this started looking more and more like the recovery phase. But in reality, it was nothing more than a retracement of the initial, panic-induced risk aversion trade.
Wave #3:
Pain & Cleansing
Tony: We miss the graph here which indicates the market is going down.
The final wave is another bout with pain. This is where all of the underlying problems come home to roost. Ultimately the problems get faced and worked through, only after which a path to a sustainable economic expansion opens.
This phase is best described as the final leg of the risk aversion trade. This is where global investors, again, flee for safety as the uncertainty elevates surrounding the fallout from damaged economies and the ability of central banks to manage all of the aggressive policy responses.
Here, investors abandon the pursuit of return ON capital, in favor of return OF capital. And this is precisely what we're seeing now in response to the dominoes lining up with sovereign debt problems.
The final phase will be a time of higher savings and flight back to the U.S. dollar.
The final phase will be a time of higher savings and flight back to the U.S. dollar.
It's also a period that begins the healing of economies. And it's driven by austerity. This means increased taxes, higher savings and a lower standard of living. In short, it's a period of rebalancing and rebuilding.
A Technical View ...
The three-phase cycle I just described is nothing new. It follows a time-tested theory on the behavior of markets and human psychology called Elliott waves. This principle suggests that patterns in markets tend to form five-wave and three-wave structures.
The five-wave structure is the dominant trend (i.e. economic expansion), and the three-wave structure is the corrective trend (economic downturn). My analysis suggests the recent downturn carries the three-wave, corrective characteristic.
Let me simplify this for you ...
A good proxy for global risk appetite has been the U.S. stock market. This is where global risk taking, or lack thereof, is among the most easily identified.
When investors shy away from risk, the stock market tends to fall. When investors embrace risk, the stock market usually rises.
S&P 500
In the chart above, it's easy to see the first two waves that I've laid out: Wave #1 — Panic; Wave #2 — Stabilization.
Admittedly, Wave #3 — Pain & Cleansing, is highly debatable. But if I'm right, it could be the phase that finally flushes out the landmines in the global economy and puts us back on a sustainable path of growth.
How this Impacts Currencies ...
This third wave supports the thesis that I've been writing about for months in this column. That is, market participants will become more averse to risk.
And it also supports my argument from last year that the U.S. dollar's demise is greatly exaggerated.
In the greatest monetary experiment of all times, following the broadest and deepest downturn since the Great Depression, you can expect surprises.
We've seen those surprises with more frequency and growing intensity over the past two months — and there will be more to come.
As this third leg of risk aversion unfolds, the dollar will again continue to function as the safe parking place for global capital. Not because the U.S. is in superior economic condition, but purely because it's the best alternative.
Regards,
Bryan
by Bryan Rich
Dear Anthony,
Bryan Rich
Over the past months I've written extensively in my Money and Markets columns about the bubbling over of the risk trade. I also warned about the rising threats that would likely make a sustainable recovery, at this point, a low probability.
And as time passes, we're beginning to see that these threats, including a growing sovereign debt crisis, rising protectionism, and threatening asset bubbles, are becoming ripe and dangerous.
But in a world of instant information, it's easy for our focus to be drawn away from the underlying fundamental problems in the world economy ...
It can be difficult to see the forest for the trees when stock markets are rising, commodity prices are recovering and the media is touting hot burgeoning world economies.
Internal Sponsorship
Recovery a major DUD — what to do ...
A shocking new report out earlier this week gives the lie to the government-endorsed myth that the worst is behind us.
Official figures out of Europe show that the Eurozone barely had a pulse. The news from the U.S. wasn't much better: Foreign investors are recoiling in horror from Washington's spending and borrowing spree.
No wonder so many Americans are FED UP with Washington and Wall Street!
Click here to register for our FREE briefing with our NEW predictions for what's ahead ...
But if you step back and examine the activities in the global economy and the global financial markets over the past 2½ years, based on history it looks like the roadmap to sustainable recovery has three waves. And we're likely only two-thirds of the way through the economic drawdown.
Wave #1:
Panic
Wave number one was panic-induced, risk aversion. It was the unraveling of the credit bubble, the seizing of the financial system and the flight of capital from all corners of the world back toward the center (the United States).
Wave #2:
Stabilization
Risk appetite returned when central bankers blanketed the world with easy money.
Risk appetite returned when central bankers blanketed the world with easy money.
The second wave was the eye of the storm. Here, risk appetite bounced back. Global central banks engaged the biggest experiment in history in an effort to stabilize a rapidly deteriorating financial system. In the process, they opened up the money spigot and flooded banks with capital, backstopped failing giants, guaranteed obligations, and printed trillions of dollars.
For many, this started looking more and more like the recovery phase. But in reality, it was nothing more than a retracement of the initial, panic-induced risk aversion trade.
Wave #3:
Pain & Cleansing
Tony: We miss the graph here which indicates the market is going down.
The final wave is another bout with pain. This is where all of the underlying problems come home to roost. Ultimately the problems get faced and worked through, only after which a path to a sustainable economic expansion opens.
This phase is best described as the final leg of the risk aversion trade. This is where global investors, again, flee for safety as the uncertainty elevates surrounding the fallout from damaged economies and the ability of central banks to manage all of the aggressive policy responses.
Here, investors abandon the pursuit of return ON capital, in favor of return OF capital. And this is precisely what we're seeing now in response to the dominoes lining up with sovereign debt problems.
The final phase will be a time of higher savings and flight back to the U.S. dollar.
The final phase will be a time of higher savings and flight back to the U.S. dollar.
It's also a period that begins the healing of economies. And it's driven by austerity. This means increased taxes, higher savings and a lower standard of living. In short, it's a period of rebalancing and rebuilding.
A Technical View ...
The three-phase cycle I just described is nothing new. It follows a time-tested theory on the behavior of markets and human psychology called Elliott waves. This principle suggests that patterns in markets tend to form five-wave and three-wave structures.
The five-wave structure is the dominant trend (i.e. economic expansion), and the three-wave structure is the corrective trend (economic downturn). My analysis suggests the recent downturn carries the three-wave, corrective characteristic.
Let me simplify this for you ...
A good proxy for global risk appetite has been the U.S. stock market. This is where global risk taking, or lack thereof, is among the most easily identified.
When investors shy away from risk, the stock market tends to fall. When investors embrace risk, the stock market usually rises.
S&P 500
In the chart above, it's easy to see the first two waves that I've laid out: Wave #1 — Panic; Wave #2 — Stabilization.
Admittedly, Wave #3 — Pain & Cleansing, is highly debatable. But if I'm right, it could be the phase that finally flushes out the landmines in the global economy and puts us back on a sustainable path of growth.
How this Impacts Currencies ...
This third wave supports the thesis that I've been writing about for months in this column. That is, market participants will become more averse to risk.
And it also supports my argument from last year that the U.S. dollar's demise is greatly exaggerated.
In the greatest monetary experiment of all times, following the broadest and deepest downturn since the Great Depression, you can expect surprises.
We've seen those surprises with more frequency and growing intensity over the past two months — and there will be more to come.
As this third leg of risk aversion unfolds, the dollar will again continue to function as the safe parking place for global capital. Not because the U.S. is in superior economic condition, but purely because it's the best alternative.
Regards,
Bryan
Saturday, February 6, 2010
Stock screen on penny stocks
A Purely Systematic Strategy
Our process screens for companies exhibiting some, if not all of these characteristics:
1. Earnings growth > 50% (and accelerating)
2. Revenue growth > 30% (and accelerating)
3. PEG Ratio < 1.50
4. Debt-to-equity < 0.5
5. Current-ratio > 1
6. Return-on-equity > 20%
7. Management ownership of stock > 10%
8. Double-digit (and increasing) profit margins
9. Market size of $1 billion or more
10. Institutional accumulation
11. Dividend yield < 1%
12. Short interest < 25%
In short, we hone in on tomorrow's big gainers with pinpoint accuracy – using a systematic, rigorous and completely proprietary 12-factor screening process. (See sidebar to the right for full details.)
By doing this we drill-down and target a very specific "sub-niche" of penny stocks.
One that's almost always profitable.
It's a certain kind of penny stock that meets very specific criteria.
Introducing SAFE
Penny Stocks
Fact is, our revolutionary screening methods – which we spent five years perfecting – let us identify SAFE penny stocks that can hand you astounding gains no matter what the markets do.
Our process is so effective because it doesn't merely focus on the upside. That's the risky way to invest in penny stocks.
It also focuses on the downside.
You see, it weeds out risky stocks, too. It does this by targeting factors such as significantly leveraged balance sheets or pending legal problems that can undercut growth and stock price.
This is why we believe that these penny stocks are one of the safest and easiest ways for you to get rich in the markets today.
Our process screens for companies exhibiting some, if not all of these characteristics:
1. Earnings growth > 50% (and accelerating)
2. Revenue growth > 30% (and accelerating)
3. PEG Ratio < 1.50
4. Debt-to-equity < 0.5
5. Current-ratio > 1
6. Return-on-equity > 20%
7. Management ownership of stock > 10%
8. Double-digit (and increasing) profit margins
9. Market size of $1 billion or more
10. Institutional accumulation
11. Dividend yield < 1%
12. Short interest < 25%
In short, we hone in on tomorrow's big gainers with pinpoint accuracy – using a systematic, rigorous and completely proprietary 12-factor screening process. (See sidebar to the right for full details.)
By doing this we drill-down and target a very specific "sub-niche" of penny stocks.
One that's almost always profitable.
It's a certain kind of penny stock that meets very specific criteria.
Introducing SAFE
Penny Stocks
Fact is, our revolutionary screening methods – which we spent five years perfecting – let us identify SAFE penny stocks that can hand you astounding gains no matter what the markets do.
Our process is so effective because it doesn't merely focus on the upside. That's the risky way to invest in penny stocks.
It also focuses on the downside.
You see, it weeds out risky stocks, too. It does this by targeting factors such as significantly leveraged balance sheets or pending legal problems that can undercut growth and stock price.
This is why we believe that these penny stocks are one of the safest and easiest ways for you to get rich in the markets today.
Tuesday, February 2, 2010
Proposed taxes
NEW YORK (CNNMoney.com) -- President Obama, in his proposed 2011 budget, is calling on Congress to make a number of tax changes for individuals.
Some ideas are new. Many others were made last year, but not enacted by Congress. So the estimates of the revenue that may be raised by his proposals may be overly optimistic.
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Across the universe of individual and corporate taxes, "what's most striking is how little new ground [the president's budget] ploughs," said Clint Stretch, managing principal of tax policy at Deloitte Tax LLC.
Here's a breakdown of some of Obama's key proposals for 2011 and beyond that would affect individuals:
High-income households
Let tax cuts expire: The 2001 and 2003 Bush tax cuts are scheduled to expire by 2011. Obama is sticking to his call to let those tax cuts expire for high-income households ($200,000 for individuals; $250,000 for families). The White House estimates close to $700 billion would be raised over 10 years.
This provision would raise the top two individual income tax rates to where they were in 2001, before passage of the Bush tax cuts. The 33% bracket would become 36%. And the 35% bracket would rise to 39.6%.
In addition, the long-term capital gains tax rate would increase to 20%, up from 15% currently.
The provision would also reinstate so-called phaseouts for high-income households, which would essentially reduce their eligibility for a host of personal exemptions.
The House may be amenable to letting the tax cuts expire in 2011 for wealthier Americans. But Stretch said it may be a tougher vote in the Senate, where there may be more of an inclination to wait until 2012 when the economy is expected to be on firmer footing.
Limit itemized deductions: The president proposes to cap at 28% the rate at which high-income households can itemize their deductions. Currently the value of a deduction is equal to the deductible amount multipled by one's top income tax rate, which can range well above 28%. So deductions will be worth less to a high-income tax filer under the president's proposal.
Capping itemized deductions is a proposal he made last year and it went nowhere. That's in part because many in Congress said it would seriously curb charitable giving, even though that is not a foregone conclusion. If the measure gains any traction this year, it's likely Congress would limit the cap to only certain types of deductions, thereby muting its revenue-raising effect.
The White House estimates that capping the rate on deductions could raise $291 billion over 10 years.
Obama maps routes to lower deficits
Keep the estate tax: The president's budget assumes the estate tax will be made permanent at a $3.5 million exemption level per person and a top rate of 45% on taxable estates. That's much more generous than current law, which calls for a $1 million exemption level and a 55% top rate starting in 2011.
But it's less generous than a proposal getting bipartisan support in the Senate. The Senate proposal would institute a $5 million exemption level per person and a top rate of 35%.
Altering the estate tax to the levels Obama has proposed would increase the deficit by $262 billion over 10 years.
Raise taxes on investment fund manager profits: Obama would like to tax the portion of profits paid to managers of hedge funds and private equity funds as ordinary income rather than as a capital gain. That would subject it to much higher tax rates than the 15% capital gains rate currently imposed. The White House estimates the measure would raise $24 billion over 10 years.
This is a carryover proposal from last year. While Congress hasn't acted on it yet, there's a fair chance they may move on it in the next year, since lawmakers will be looking for ways to pay for other costly legislation they'd like to pass.
Eliminate capital gains tax on small business stock: There are currently capital gains tax breaks in place for investors in small businesses, defined as companies with gross assets of $50 million or less. But the president is proposing to eliminate the capital gains tax altogether on stock in small businesses held for at least five years. The measure would only apply to stock acquired after Feb. 17, 2009. The cost of the president's proposal is an estimated $8.1 billion over 10 years.
Lower and middle income households
Make tax cuts permanent: The president's budget assumes all the 2001 and 2003 tax cuts will be made permanent for everyone making less than $200,000 ($250,000 for couples), which is the majority of American households.
That means, among other things, that today's rates on income tax, capital gains and dividends would remain the same.
It's an expensive proposition, however, costing federal coffers nearly $2 trillion over 10 years.
Permanently protect the middle class from the "wealth" tax: The administration assumes in the president's budget that Congress will permanently change the parameters of the Alternative Minimum Tax (AMT). That would protect tens of millions of middle-income families from having to pay the tax, which was originally intended only for the highest earners.
The cost of such a provision is close to $660 billion over 10 years.
Extend the Make Work Pay credit: The president's 2011 budget calls for a one-year extension of the stimulus-created tax credit that adds a few dollars to workers' paychecks every pay period. The extension is estimated to boost the deficit by $61.2 billion over 10 years.
Calling for just a one-year extension is a switch from Obama's call to make the credit permanent last year. The hope may still be that the credit is renewed every year -- as many tax breaks are. But by only calling for a one-year extension, the impact on the 10-year deficit appears to be less.
Permanently expand a low-income tax credit: The stimulus package temporarily expanded the Earned Income Tax Credit for very low-income families with three or more children. The expansion meant such families could claim a credit equal to 45% of their qualifying earnings, up from 40%, so that they could get a maximum credit of $5,657. President Obama wants to make that increase permanent at an estimated cost of $15.2 billion over 10 years.
Expand child-care tax credit: Under the president's budget, families making less than $85,000 would be able to claim nearly double the child and dependent care tax credit for which they currently qualify. The White House estimates the increase will raise the deficit by $12.6 billion over 10 years.
Permanently extend the American Opportunity Tax Credit: Created under stimulus legislation, the American Opportunity Tax Credit expanded for 2009 and 2010 the existing Hope Scholarship tax credit and made it partially refundable -- meaning that a tax filer could get money back even if it meant he or she would be getting back more from Uncle Sam than paid in federal income tax.
The credit is worth up to $2,500 for higher education expenses, up from $1,800 previously. The president would like to make the measure permanent, adding to the deficit by $75.4 billion over 10 years
Some ideas are new. Many others were made last year, but not enacted by Congress. So the estimates of the revenue that may be raised by his proposals may be overly optimistic.
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Across the universe of individual and corporate taxes, "what's most striking is how little new ground [the president's budget] ploughs," said Clint Stretch, managing principal of tax policy at Deloitte Tax LLC.
Here's a breakdown of some of Obama's key proposals for 2011 and beyond that would affect individuals:
High-income households
Let tax cuts expire: The 2001 and 2003 Bush tax cuts are scheduled to expire by 2011. Obama is sticking to his call to let those tax cuts expire for high-income households ($200,000 for individuals; $250,000 for families). The White House estimates close to $700 billion would be raised over 10 years.
This provision would raise the top two individual income tax rates to where they were in 2001, before passage of the Bush tax cuts. The 33% bracket would become 36%. And the 35% bracket would rise to 39.6%.
In addition, the long-term capital gains tax rate would increase to 20%, up from 15% currently.
The provision would also reinstate so-called phaseouts for high-income households, which would essentially reduce their eligibility for a host of personal exemptions.
The House may be amenable to letting the tax cuts expire in 2011 for wealthier Americans. But Stretch said it may be a tougher vote in the Senate, where there may be more of an inclination to wait until 2012 when the economy is expected to be on firmer footing.
Limit itemized deductions: The president proposes to cap at 28% the rate at which high-income households can itemize their deductions. Currently the value of a deduction is equal to the deductible amount multipled by one's top income tax rate, which can range well above 28%. So deductions will be worth less to a high-income tax filer under the president's proposal.
Capping itemized deductions is a proposal he made last year and it went nowhere. That's in part because many in Congress said it would seriously curb charitable giving, even though that is not a foregone conclusion. If the measure gains any traction this year, it's likely Congress would limit the cap to only certain types of deductions, thereby muting its revenue-raising effect.
The White House estimates that capping the rate on deductions could raise $291 billion over 10 years.
Obama maps routes to lower deficits
Keep the estate tax: The president's budget assumes the estate tax will be made permanent at a $3.5 million exemption level per person and a top rate of 45% on taxable estates. That's much more generous than current law, which calls for a $1 million exemption level and a 55% top rate starting in 2011.
But it's less generous than a proposal getting bipartisan support in the Senate. The Senate proposal would institute a $5 million exemption level per person and a top rate of 35%.
Altering the estate tax to the levels Obama has proposed would increase the deficit by $262 billion over 10 years.
Raise taxes on investment fund manager profits: Obama would like to tax the portion of profits paid to managers of hedge funds and private equity funds as ordinary income rather than as a capital gain. That would subject it to much higher tax rates than the 15% capital gains rate currently imposed. The White House estimates the measure would raise $24 billion over 10 years.
This is a carryover proposal from last year. While Congress hasn't acted on it yet, there's a fair chance they may move on it in the next year, since lawmakers will be looking for ways to pay for other costly legislation they'd like to pass.
Eliminate capital gains tax on small business stock: There are currently capital gains tax breaks in place for investors in small businesses, defined as companies with gross assets of $50 million or less. But the president is proposing to eliminate the capital gains tax altogether on stock in small businesses held for at least five years. The measure would only apply to stock acquired after Feb. 17, 2009. The cost of the president's proposal is an estimated $8.1 billion over 10 years.
Lower and middle income households
Make tax cuts permanent: The president's budget assumes all the 2001 and 2003 tax cuts will be made permanent for everyone making less than $200,000 ($250,000 for couples), which is the majority of American households.
That means, among other things, that today's rates on income tax, capital gains and dividends would remain the same.
It's an expensive proposition, however, costing federal coffers nearly $2 trillion over 10 years.
Permanently protect the middle class from the "wealth" tax: The administration assumes in the president's budget that Congress will permanently change the parameters of the Alternative Minimum Tax (AMT). That would protect tens of millions of middle-income families from having to pay the tax, which was originally intended only for the highest earners.
The cost of such a provision is close to $660 billion over 10 years.
Extend the Make Work Pay credit: The president's 2011 budget calls for a one-year extension of the stimulus-created tax credit that adds a few dollars to workers' paychecks every pay period. The extension is estimated to boost the deficit by $61.2 billion over 10 years.
Calling for just a one-year extension is a switch from Obama's call to make the credit permanent last year. The hope may still be that the credit is renewed every year -- as many tax breaks are. But by only calling for a one-year extension, the impact on the 10-year deficit appears to be less.
Permanently expand a low-income tax credit: The stimulus package temporarily expanded the Earned Income Tax Credit for very low-income families with three or more children. The expansion meant such families could claim a credit equal to 45% of their qualifying earnings, up from 40%, so that they could get a maximum credit of $5,657. President Obama wants to make that increase permanent at an estimated cost of $15.2 billion over 10 years.
Expand child-care tax credit: Under the president's budget, families making less than $85,000 would be able to claim nearly double the child and dependent care tax credit for which they currently qualify. The White House estimates the increase will raise the deficit by $12.6 billion over 10 years.
Permanently extend the American Opportunity Tax Credit: Created under stimulus legislation, the American Opportunity Tax Credit expanded for 2009 and 2010 the existing Hope Scholarship tax credit and made it partially refundable -- meaning that a tax filer could get money back even if it meant he or she would be getting back more from Uncle Sam than paid in federal income tax.
The credit is worth up to $2,500 for higher education expenses, up from $1,800 previously. The president would like to make the measure permanent, adding to the deficit by $75.4 billion over 10 years
Monday, February 1, 2010
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