General Market Direction Predictions

AlfredSokol said: "What do you think of current "market" conditions? I'm sort of bearish now."

thezster said: "Kind of depends on what types of stocks you're interested in...... I find "General Market Conditions" have little influence on specific sectors. Then again, if you're truly diversified (and, Lord knows I'm not)..... I suppose "General Market Conditions" might apply. Soooooooo........... as a general statement... I'd say we're a bit sideways... Market could soar shortly as stocks regain all they've lost over the spring/summer......... Or could stagnate with all the bad news overriding general conditions. Bearish? Long term, NO!"

AlfredSokol said: "What sectors do you like best right now?"

thezster said: "Sorry, don't monitor sectors. I play the same 6 - 10 stocks over and over......... market conditions notwithstanding. It's the daily swings that I make my money on, nothing long term. If I hold a stock more than 48 hours, I get itchy.... Current holdings: HD - 5,000 shares @ $40.00 CLX - 5,000 shares @ $55.55 BUD - 1,000 shares @ $46.01 (ouch) That's where I am today, and 3 of the 4 most actives on my list.... Hope to be out of the first two by end of the week.... with a couple of bucks in my pocket.... I like serious bricks n morter companies....... ones that I know will always come back....... no matter how low they might go on bad news.... The BUD I've had for weeks now......... don't like it... but know that sooner or later, I'll come out even, if not ahead."

thezster said: "Ooops, forget the above.... Just got rid of the CLX @ $56.70 C'mon HD!!!!!!!!! ;)"

Darren said: "i trade pvn a few hundred times in 2002. it was boring , but profitable"

thezster said: "[QUOTE=ben]i trade pvn a few hundred times in 2002. it was boring , but profitable[/QUOTE] PVN appears to have about a 0.30 +/- spread on average..... difficult to make any serious money.. but appears nice and steady. Boring is just fine with me.... as long as it's profitable. If I get bored trading the same ole stocks........ I take the proceeds and find something a bit more exciting to spend it on... :)"

HappyHarry said: "I'm bearish right now. I feel home prices will burst soon, and gas prices are killing the average consumer."

LanceJ said: "[QUOTE=AlfredSokol]What sectors do you like best right now?[/QUOTE] Hi buddy. I think the high energy/gas prices will result in sector rotation as we transition into an energy economy. Sectors I'm BULLISH on: 1. Oil & Gas Refining Mrktng 2. Oil & Gas Equipment Svcs 3. Oil & Gas Drilling Explor 4. Independent Oil & Gas 5. Industrial Equip Wholesle 6. Cement 7. Industrial Metals Minerals - Uranium 8. Health Care Plans 9. Heavy Construction Sectors I'm BEARISH on: 1. Recreational Vehicles 2. Jewelry Stores 3. Home Furnishing Stores 4. Mortgage Investment 5. Electronic Equipment"

LanceJ said: "Add Gold to my Bullish sector list."

poldo said: "[QUOTE=LanceJ]Add Gold to my Bullish sector list.[/QUOTE] Steel and lumber ? I don't agree with electronics there are a few must have in peoples list for christmas but after that it can turn south I voted sideways but soon to turn bullish"

HappyHarry said: "I agree with the bears on the list. Why jewelry stores though?"

LanceJ said: "[QUOTE=HappyHarry]I agree with the bears on the list. Why jewelry stores though?[/QUOTE] Discretionary income dries up as the cost of living/inflation (rising energy, gas, home mortgages, personal debt, etc..) rises. Jewelry stores get hit very hard, even though precious metals rise (which can increase the cost of jewelry as say the price per ounce of gold rises), because it is viewed as a luxury and not a necessity (unless you're my wife). :cool:"

thezster said: "With the recent destruction in the Gulf region....... what's your take on building supply/home improvement retailers (who supply a huge number of contractors) over the next 12 - 24 months?"

LanceJ said: "[QUOTE=thezster]With the recent destruction in the Gulf region....... what's your take on building supply/home improvement retailers (who supply a huge number of contractors) over the next 12 - 24 months?[/QUOTE] I think a good way to play the destruction in the Gulf region is to buy companies in the cement sector. The price of cement continues to go up as demand increases and supply struggles to keep up. The best performing ones are: FRK FLORIDA ROCK RIN RINKER GRP LTD CX CEMEX SA DE CV EXP EAGLE MATERIALS JHX JAMES HARDIE IN LAF LAFARGE NORTH A My favorite is CX and is profiled in the Sticky Six message thread. Building supplies/home improvement stores would be another excellent way to play the destruction in the Gulf region, but a little more risky than playing Cement at the present. The best performing ones are: BMHC BUILDING MATERIALS LOW LOWES COMPANIES FAST FASTENAL CO"

QUAVIET said: "Hey Lance, Do you really think that gold can rise much higher than it has in the last few years. I have a problem with gold because other than looking pretty there is no real value. You can't eat it, smoke it or power your SUV with it. What is your opinion on the rare coin market?"

LanceJ said: "[QUOTE=QUAVIET]Hey Lance, Do you really think that gold can rise much higher than it has in the last few years. I have a problem with gold because other than looking pretty there is no real value. You can't eat it, smoke it or power your SUV with it. What is your opinion on the rare coin market?[/QUOTE] First, look at this chart: [CENTER][IMG]http://www.acethecset.com/gold.GIF[/IMG] [/CENTER] Gold is still about half off from its all time high. Many Gold experts think Gold will make a run for $1,200 per ounce in the next couple of years. Gold experts are predicting $500 an ounce by the end of the year. It’s been three decades since the dollar’s tie to gold was completely severed. The dollar, and all our money, is nothing more and nothing less than what it looks like: a cut piece of linen paper with fancy printing on it. You can exchange it for other currency at a fixed rate and for any good or service at a flexible rate. But there is no established exchange rate between the dollar and gold, either at home or internationally. In the whole history of civilization, gold has served as the basic money of all people wherever it’s been available. governments destroyed the gold standard. Why? Because they regarded it as too inflexible. To be sure, monetary inflexibility is the friend of free markets. Without the ability to create money out of nothing, governments tend to run tight financial ships. Banks are more careful about the lending when they can’t rely on a lender of last resort with access to a money-creation machine like the Fed. A fixed money stock means that overall prices are generally more stable. The problems of inflation and business cycles disappear entirely. Under the gold standard, in fact, increased market productivity causes prices to generally decline over time as the purchasing power of money increases. In 1967, Alan Greenspan once wrote an article called Gold and Economic Freedom. He wrote that: An almost hysterical antagonism toward the gold standard is one issue which unites statists of all persuasions. They seem to sense – perhaps more clearly and subtly than many consistent defenders of laissez-faire – that gold and economic freedom are inseparable, that the gold standard is an instrument of laissez-faire and that each implies and requires the other… This is the shabby secret of the welfare statists' tirades against gold. Deficit spending is simply a scheme for the confiscation of wealth. Gold stands in the way of this insidious process. It stands as a protector of property rights. He was right. Gold and freedom go together. Gold money is both the result of freedom and its leading protector. When money is as good as gold, the government cannot manipulate the supply for its own purposes. Just as the rule of law puts limits on the despotic use of police power, a gold standard puts extreme limits on the government’s ability to spend, borrow, and otherwise create crazy unworkable programs. It is forced to raise its revenue through taxation, not inflation, and generally keep its house in order. By driving up the price of gold, prompting gold producers to become profitable again, the people are expressing their lack of confidence in their leaders. They have decided to protect themselves and not trust the state. That is the hidden message behind the new luster of gold. Why Gold is an inflationary hedge, visit and for continued reading, go to: [url]http://www.safehaven.com/article-1444.htm[/url] Sources and Excerpts from: [url]http://www.lewrockwell.com/rockwell/whygold.html[/url]"

LanceJ said: "[QUOTE=QUAVIET]Hey Lance, Do you really think that gold can rise much higher than it has in the last few years.[/QUOTE] The second implication to your question brings me into a rule I constantly drill into readers heads here at superiorinvestor.com and that is, a trend will continue until that trend actually ends. On days a stock, or in this case gold, trades sideways, assume continuation of the previous trend. Gold is in a massive upward trend. Until that trend actually ends, assume it will continue. In otherwords, be a bull in a bull market, and a bear in a bear market. This is probably the #1 rule in investing. Investors will try to be "contrarians" by being a bear in a bull market, or a bull in a bear market but this only works during market extremes which seldomly happens. Most bull and bear markets last several years, so there's usually plenty of time to climb aboard. In other words, if you think gold has already gone up enough, and are trying to be the "contrarian" by sitting on the sidelines or not investing in gold, you will learn a hard lesson. Remember, be a bull in a bull market, and a bear in a bear market. Assume the bull market in gold will continue until PROVEN otherwise."

thezster said: "[QUOTE=LanceJ]I think a good way to play the destruction in the Gulf region is to buy companies in the cement sector. The price of cement continues to go up as demand increases and supply struggles to keep up. The best performing ones are: FRK FLORIDA ROCK RIN RINKER GRP LTD CX CEMEX SA DE CV EXP EAGLE MATERIALS JHX JAMES HARDIE IN LAF LAFARGE NORTH A My favorite is CX and is profiled in the Sticky Six message thread. Building supplies/home improvement stores would be another excellent way to play the destruction in the Gulf region, but a little more risky than playing Cement at the present. The best performing ones are: BMHC BUILDING MATERIALS LOW LOWES COMPANIES FAST FASTENAL CO[/QUOTE] Day late and a dollar short - as the saying goes.... Your picks on the cement industry seem to have been right on.... Kudos to you!! Since Katrina, those companies have done extremely well....short term. As is often the case, I look at them a bit to late and then say "But, of course...... makes perfect sense". And, as I never chase a stock up.... I'll sit on the sidelines with those particular picks. Back to the grind........."

LanceJ said: "[QUOTE=thezster]Day late and a dollar short - as the saying goes.... Your picks on the cement industry seem to have been right on.... Kudos to you!! Since Katrina, those companies have done extremely well....short term. As is often the case, I look at them a bit to late and then say "But, of course...... makes perfect sense". And, as I never chase a stock up.... I'll sit on the sidelines with those particular picks.[/QUOTE] Hey Kudos buddy. I think you're right on, I wouldn't buy them either right now. We got stopped out of the CX (cement) play for about a 6% gain last week. I'm a bit more defensive than when I wrote this taking the profits made in CX and moving them into the ETF Emerging Markets Fund (EEM) as a play on rising foreign markets that are doing great right now as the U.S. market continues in a downward trend that began in August: a mini-bear market we are currently in. More details about EEM are in the Sticky Six message thread."

LanceJ said: "[QUOTE=QUAVIET]Hey Lance, Do you really think that gold can rise much higher than it has in the last few years. [/QUOTE] So far, precisely what I said is going to happen with gold is happening. Check out this latest news story today. GLOBAL MARKETS-Inflation concerns boost gold, stocks slide Wed Oct 12, 2005 "Concerns about U.S. inflation and interest rates dominated financial markets on Wednesday, boosting gold to a near 18-year high, weighing on stocks and briefly lifting the dollar to multi-month highs. Gold climbed to $480.25 an ounce, its highest level since early 1988 despite the firmer dollar, as funds continued to buy it as an inflation hedge." If funds are buying gold, then you should be to. For how I am playing the rising price of gold, see the Sticky Six message thread and the stock that is profiled there called Goldcorp (GG)."