Over the Long Term the Markets WILL be Up;Invest Accordingly

[Aman A.K.A. Ahamburger]

U mean Aman, right?

Looks like the US continues to grow slowly, as the service sector is growing faster than anticipated. Makes sense since we are seeing growth in housing, manufacturing, oil and gas production, trucking and train transportation, as well as, farming.

Has the EU recession bottomed finally? We will find out soon enough..

The media has finally caught on to the fact that China is in the exact same spot Japan was before their 20 year depression hit, and of course, the Middle East situation is getting way out of hand.

Watch out for 2013... 

I was trying to figure out a way to explain that the policies put in place in the early 80's were terrible LONG TERM policies. That they were, in fact, a return to deficit financing and not any type of real LONG TERM solution. Aside from globalizing the US brand that is, so if and when Capitalism came out on top, it was US brands that were front and center.. (Present)

That the short term pain we are feeling right now(2000 to 2020 or maybe 2030) is actually going to lead to LONG TERM gain.. Like I said, I was trying to figure out a way to describe all this, when I realized that a picture is worth a thousand words..

The new gold standard;  10% reserve capital in the banks, and balanced govt budgets.  Free Enterprise FTW! 

[Aman A.K.A. Ahamburger]

 More on the 2013 equation.. 

 Continued slow growth in the US because of higher taxes and a housing recovery. This is on full display with the first time unemployment claims. 

After spreading all through Europe in the first quarter of the year, the politicians have claimed their recession is over.  Forget that retail sales are still dragging, the only countries that actually grew were France and Germany, and at this point Euro growth for the year is still at 0%.  However, I know for a fact that socialism is dying so I won't be surprised if at some point if capitalism makes a comeback in Europe and they make their way back to growth.  It might be a bit hard off the start to convince European people that things are getting better though, we all remember in the days after the recession ended here how upset people got when they didn't believe it. It's twice as bad there..... Immigrants in Greek detention center clash with police.

China's property bubble was once again featured on 60 mins.  This time it was reveled that the developers are essentially out of money as entire ghost cities are now stalled.  The largest home builder in China was interviewed and fully admitted that Chinese real estate is in a massive bubble that, if popped, would cause social unrest that would match the Arab spring.  The bird flu is back causing trouble for YUM foods and Japan is now in a quadrillion YEN of debt.. But hey, the trustworthy Chinese media is telling us that the slowdown in China is... slowing down... I guess we will see.. Singapore Cuts Trade Outlook as China Slowdown Caps Recovery.   Should be interesting to see what higher interest rates does to this situation, along with the housing markets in Canada, Australia, ect.. 

The Middle East..... Situation is spreading...

As always, buy on any dip or correction. 

[frankq]

Aham, I'm thinking we start cherry picking, .......T. I'll take a 5.2% div anytime. Sales growth is flat at this time, but income growth is up 80+% over the year. I don't care what happens, people will do without anything but a phone. ACMP at $44.

[Aman A.K.A. Ahamburger]

That's why I'm a big fan of BCE.. Over 5% just like T, they also have tons of content and have a huge lead in the mobile TV market. Their shares are being hammered right now because of VZ potential entry into the Canadian market, over the long term... Just like POT, they are at levels not seen since 2010 because of the "news", over 4% yield. Potash is a big part of food production.. Another one of those things we can't do without..

[frankq]

Aham, check out ACMP.

[Aman A.K.A. Ahamburger]

Interesting for sure,the PE is a bit high..... I like TRP for that space, their PE is a bit high right now as well, but TRP has a decent EPS and the natural gas oil patch in Canada is just starting really.

[Aman A.K.A. Ahamburger]

I decided to change the title of the thread to reflect the nature of the OP. I personally don't really care what the market number is at because I look at the doom and gloom as an investment opportunity. I know that if the market goes to 0 there are more issues to worry about than what the market is at. What I have done since I was in high school is try to outline for myself what potentially issues there are to watch out for so that I am not blind sided by "black swan events". IMO, to get an idea of what's in store for 2014 we have to go back to 2012 and the events leading up to 2013.....

Feb 19, 2013 19:21:24 GMT -5 Aman A.K.A. Ahamburger said:

So here we are in 2013, glad we made it through the end of the world in 2012.  In fact, not only did the world not end, looking at earnings for the fourth quarter, business was picking up in 2012.  We know the housing market really made strides on the way to recovery in the US, and before I go on, lets go back a year.......

Jan 3, 2012 2:31:50 GMT -5 Aman A.K.A. Ahamburger said:

Some thoughts for 2012....

The underlying theme in the USA this year will obviously be the elections. The most expensive elections in history most likely, this alone will be a stimulator for the economy. By April we will know more of how the job picture will look for the rest of the year, and how much was the regular seasonal bump. The lumber industry in NA however will be very strong. The Chinese govt will start building 1.2 million houses a year this year, for the next five years.

As those house holds are formed, there will be increased consumption in energy and food. We have see the result of that this year in record profits for farmers and the fact that the USA is now a fuel exporter. The price of oil will be high because there are serous tensions building in the middle east, and from the China takes a stance on the middle east thread, we can see that come March, the Iranian elections are going to consume all the headlines.

Russia, more elections, they are also going to have an uprising this year unless we see Putin step down, and the situation in middle Africa with the Islamic militants will get more serious as the "secular" democracies of the middle east and Northern Africa start coming online.

China has just been awarded the first contract in Afghanistan to drill for oil, and they view the stability of Africa and the Middle east as their foremost goal in foreign policy(sound familiar?). However, China has just as many internal problems to deal with as the rest of these countries, and during this transition of commies in the year of the dragon, we will see the Chinese people come alive as they push for greater freedoms from the leaders that are promising happiness not GDP.

Because of this, you will see China continue to do what they did in the fishing village and slowly start to give way to what the people want. They will have to have a military presence in Africa and the middle east within the next five years to protect their resources. They cannot afford to lift 600 million people out of poverty, while keeping them controlled the way they want, while trying to keep resources secure.

IMO, the solution is clear, it's just not what the commies want. Oh well.

On the bright side, having businesses that need profits from consumers isn't the worst way to have things set up. Especially when you can invest in those companies that are going to be at the forefront of rebuilding the world as the last of the dictatorships crumble. The economic numbers in the USA will be good for the coming quarter as all the major Econ numbers over the last month have been positive, and even though Europe is slowing down, there is still expansion in the USA, and now in India and China as well. This is also a signal that domestic consumption is picking up in China and India, because while the US was expanding in the second half of the year, India and China were declining with the problems in Europe. We all know that the problems in Europe are far from over.

The debt problems in Europe, the possible exit of countries from the Euro and now Japan's problems will be a great way to keep the D&G in the headlines, which will keep the indexes in check for the year, and could very well bring people back to the precious metals short term.

These of course, are all just the thoughts of a spectator that loves economics, long term Investing in quality companies, good interest rate AAA bonds, and property.

  The reason I wanted to start in 2012 is because the highlighted parts of the entry above are what is starting to shape in the year ahead.  The election in the USA is bringing the biggest changes in US history in regards to health care, and we are starting to see the effects taxes will have with the payroll tax increase of Jan 1.  While the "fiscal cliff" was a hyped up, the reality of the situation is that a big company like Wal-mart thinks the payroll tax has hurt their bottom line. The payroll tax is only the first tax that is going to be implemented this year, and there are going to be some degree of budgets cuts coming up as the March 1 "fiscal cliff" passes.  Then we have to add in the fact that there are new medicare rules/taxes coming, and new taxes on investors starting in 2014.

  All of this sounds very pessimistic, especially when you consider that the debt problems in the EU are still not truly under control. However, the main thing that happened in 2012 that is combating all this bad news, is the same thing that will continue to grow through 2013; the USA's strength in all the weakness. We can see this story taking shape in the job market.  Just like at the start of 2012 when it looked like the USA was going to be able to keep coming back because of a healing domestic economy(housing) and increased exports, even as the EU entered into a recession(and it did), there is no reason to think now that 2013 will be any different. All this does mean one thing for sure though, continued slow growth.

The other big thing that is highlighted above is how China was really going to step up it's domestic consumption.  It looked like China was about to enter a recession in the middle of 2012, however, the move towards happiness not GDP kicked in and even though the manufacturing sector didn't really pick back up for China like it did for the USA in the second half of 2012, the Chinese economy started coming back because of the service sector.  There is no reason to think that this will change as the social problems are still very much there for China, from Tibet to Hong Kong, and now they also have a hostel North Korea to deal with, along with island problem against Japan and Russia.

The other thing that really started to take hold in 2012 was the issues in the Middle East.  We all seen the problems that emerged and the biggest thing that is happening there right now is that China is taking control of a key sea port in Pakistan.  This again plays into a highlighted trend above, China's goal of stability in the Middle East and Africa.  With civil wars raging from Syria to Mali, and political unrest going on for two years now in Egypt and Bahrain threatening to engulf the whole region that includes Iran trying to go nuclear, there is no way that some kind of "black swan" event won't come out of that region over the next two years.

To summarize, the trend of a recovering housing market coupled with increasing exports from energy and food production is set to take hold in 2013 in the USA.  With the added bonus that the manufacturing comeback in the USA is a two fold process, with 3D printing helping lead the way for smaller manufactures.  China will continue to focus on stability while doing what they can to flex their muscles in the South China Sea. India and Africa will follow suite with China in trying to increase domestic consumption while trying to promote stability.  While the Russians weren't successful in their Putin take down there is definitely trouble in paradise there, as Russia is having meetings with the ECB.

 Overall, volume is starting to take hold in the global economy and any "black swan" or market correction in 2013 because of emotions should be looked at as a buying opportunity for long term investors, because no matter what the markets will be up. Why? Because the whole world is moving towards love not war(business).

As always, just the thoughts of a long term business investor that loves dividend paying stocks, AAA bonds, and property.   

Ok, for 2014 I look at it like this, the best growth predictions for Europe are 1.5%.. At this point in the game you can't call that growth. If I was 2009ish, then ok... For this not to be a stalling out point, we need to see stellar 2.5%+ growth out of Europe this year. However, Europe's latest numbers aren't looking pretty, and for all the talk about a healing EU economy, the recession actually got worse in 2013. The fact is that for the first half of 2013 the recession grew, and over the summer growth moved into a stall?(O.1% GDP?) Just in time for France to almost tip back into recession.... Oh and lets not forget that an actual neo-nazi party was JUST elected in Slovakia.

China's internal policies are increasing domestic demand for sure, however, there are a lot of credit risks popping up. China is running out of money faster than then are letting on and that is why China's growth is decelerating. The massive property black hole is taking more and more money to fill and there is no way that China can move it's population into a 75% urban population fast enough. However, over the long term even if there is a massive crash in the Chinese economy they will be able to stabilize it and finish off this global re-balancing act, with the help of their American friends of course. Nothing like having two legs...

Lets quit beating around the bush and call the situation in the Mid East what it is, an all out war that is bringing on the collapse of Islam. The oil market is in complete disarray because of it, and the economies of Syria, Lebanon, Iraq, and as of right now most likely Jordan, and Turkey will need to be completely rebuilt. The Pope is going to the Mid East this Spring and apparently Sen. Kerry was just at the Vatican to discuss the war in the Mid East.

I think we are getting close to a stalling point, like in 1932, but since it's like the 1880-90's it's just going to stay drawn out. We want there to be faster growth, but it's the Great Stagnation and I suspect it could last for at least another 7 years. As a society we will go through a period of time when everything is brought under the umbrella of the almighty and we will use our free wills to get along and move forward, or.... Since Israeli politics are becoming a global issue(boycotts, China getting involved in the Israel, Palestinian talks), the Mid East region is engulfed in war that is spreading to Africa, Europe, Russia, and China, 2014 could be the year when the universal question of WHY? comes front and center in MSM.

To be honest, this is pretty much the exact path that I anticipated we would be on in 2009-2010. I would guess that by the end of 2015 the USA, and NA in general, will be the lone survivors in this economic battle and we will be on the path to help rebuild the world! Manufacturing, robots, renewable energy so that we can supply the world with oil, all these things will play a role in the continuing American Renaissance. It's truly the story of the tortoise and the hair. While everyone thinks that Americans take short cuts, it has been a long slow battle to get to the point that we are at right now. Places like China on the other hand......

What all this mean for the number in the markets? Again, I have no idea. As most know I am a student of history and I will stick to something I read a long time ago. It's one of the oldest investing quotes there is, "buy when there is blood on the streets." Aka, always bet on red.

As always, just the thoughts of a long term investor.

[Aman A.K.A. Ahamburger]

Jan 13, 2014 22:39:16 GMT -5 Aman A.K.A. Ahamburger said:

I decided to change the title of the thread to reflect the nature of the OP. I personally don't really care what the market number is at because I look at the doom and gloom as an investment opportunity. I know that if the market goes to 0 there are more issues to worry about than what the market is at. What I have done since I was in high school is try to outline for myself what potentially issues there are to watch out for so that I am not blind sided by "black swan events". IMO, to get an idea of what's in store for 2014 we have to go back to 2012 and the events leading up to 2013.....

I think we are getting close to a stalling point, like in 1932, but since it's like the 1880-90's it's just going to stay drawn out. We want there to be faster growth, but it's the Great Stagnation and I suspect it could last for at least another 7 years. As a society we will go through a period of time when everything is brought under the umbrella of the almighty and we will use our free wills to get along and move forward, or.... Since Israeli politics are becoming a global issue(boycotts, China getting involved in the Israel, Palestinian talks), the Mid East region is engulfed in war that is spreading to Africa, Europe, Russia, and China, 2014 could be the year when the universal question of WHY? comes front and center in MSM.

U.S. GDP Grew A Glacial 0.1% In The First Quarter 2014
Private Businesses Created 220,000 Jobs in April, Says ADP
U.S. factory output continues its upswing in March

Just like I was saying in January.. The Great Stagnation continues. Even the big finicial houses are starting to see it my way..

Only difference from my start of the year analysis,  in January Putin wasn't on a rampage... Have fun with companies that are relying on global growth.

[Aman A.K.A. Ahamburger]

Further evidence that the global economy is hitting the headwinds that were posted about in January can be found in none other than corporate earnings. It's a good thing the US economy is in recovery mode, I can't even imagine how bad these numbers would be if it wasn't.

Stocks are riding optimism, not earnings, to records



The workings of the Dow suggest hope is driving prices rather than the bottom line. Sales and profit trends aren’t looking so hot, nor are corporate outlooks.

The 24 out of 30 blue-chip companies that have already reported are showing a 3.3% decline in first-quarter earnings, setting up the third year-over-year decline in earnings out of the past four quarters, says FactSet data. Similarly, revenue is on track to rise 0.4% for the first quarter, which would be the seventh straight quarter of sub-1% growth. Yet, over the past 12 months, the Dow is up more than 11%.

[tyfighter3]

It's JMO, but I think Weather had a bigger impact on 1"st Quater results this year than most people think. there will be some good buying oppertunities this Quarter and should show us that the first one Quarter was just that. I also think that the Energy sector this year will lesd the way. Of course this is JMO.

[Aman A.K.A. Ahamburger]

I think US GDP was affected by the weather big time in the first quarter. However, outside the US from companies like SocGen and Tyson, we can see that headwinds are coming.

I agree that energy companies, especially ones focused mostly on NA assets are poised to do well, regardless of what happens going forward from this point.

Check this out...

Watch Lockheed Martin's laser weapon take down boats from a mile away

[Aman A.K.A. Ahamburger]

The OECD hopes Europe is going to grow at 1.2%....

OECD pumps brakes on global economic growth forecast

Europe’s Bad Bank Assets Since 2008 Top $2.5 Trillion

Just how big is Europe’s “bad bank” sector?

On Thursday, Barclays PLC became the latest firm to set one up. The U.K. lender is placing $195 billion of assets into its “non-core” unit

According to our calculations, that means the total value of assets at all the state-backed and privately-held bad banks set up in Europe since 2008 has now gone through the $2.5 trillion mark, making them collectively bigger than J.P. Morgan Chase & Co., which had a balance sheet of just over $2.4 trillion at the end of last year. (All currency conversions have been made at today’s rates.)

[Aman A.K.A. Ahamburger]

And the headwinds are getting stronger.. Stay

-China property slowdown to hurt Australia
-Eastern Europe’s analysts are furiously slashing their economic forecasts

[Aman A.K.A. Ahamburger]

May 9, 2014 12:09:35 GMT -5 Aman A.K.A. Ahamburger said:

The OECD hopes Europe is going to grow at 1.2%....

It's like my Granddad used to say; wish in one hand and $#'t in the other, see which one fills up faster..

Euro zone’s GDP growth disappoints, inflation in ‘danger zone’

[Aman A.K.A. Ahamburger]

Jan 13, 2014 22:39:16 GMT -5 Aman A.K.A. Ahamburger said:

For this not to be a stalling out point, we need to see stellar 2.5%+ growth out of Europe this year. However, Europe's latest numbers aren't looking pretty, and for all the talk about a healing EU economy,.......

China's internal policies are increasing domestic demand for sure, however, there are a lot of credit risks popping up. China is running out of money faster than then are letting on and that is why China's growth is decelerating. The massive property black hole is taking more and more money to fill and there is no way that China can move it's population into a 75% urban population fast enough....

Lets quit beating around the bush and call the situation in the Mid East what it is, an all out war .......

I think we are getting close to a stalling point, like in 1932, but since it's like the 1880-90's it's just going to stay drawn out. We want there to be faster growth, but it's the Great Stagnation and I suspect it could last for at least another 7 years.....

Six months later almost to the day....

WB Lowers Projections for Global Economic Outlook, Urges Developing Countries to Double Down On Domestic Reforms

Developing countries are headed for a year of disappointing growth, as first quarter weakness in 2014 has delayed an expected pick-up in economic activity, according to the World Bank’s Global Economic Prospects (GEP) report, released today.

Bad weather in the US, the crisis in Ukraine, rebalancing in China, political strife in several middle-income economies, slow progress on structural reform, and capacity constraints are all contributing to a third straight year of sub 5 percent growth for the developing countries as a whole.

[Aman A.K.A. Ahamburger]

Right on Schedule, U.S. Stocks Decline as World Bank Cuts Growth Forecast.

Hey Virg! Don't be too surprised when we make it through.

[tyfighter3]

May 7, 2014 23:11:22 GMT -5 tyfighter3 said:

It's JMO, but I think Weather had a bigger impact on 1"st Quater results this year than most people think. there will be some good buying oppertunities this Quarter and should show us that the first one Quarter was just that. I also think that the Energy sector this year will lesd the way. Of course this is JMO.

I still think energy will lead the way this year. The Middle east is going up in smoke and that is no good on anybodys pocket book except if you own energy stocks. A good hedge IMO.

[tyfighter3]

How does your state compare?
blogs.marketwatch.com/capitolreport/2014/06/11/north-dakota-gdp-grew-the-fastest-last-year-what-about-your-state/?link=instory

[Aman A.K.A. Ahamburger]

Ty, oil and gas plays for sure. Also manufacturing companies, defense.. The east is the area of the world that is set up to burn. People that don't understand economics, at all, are the ones that see a total collapse.

They fail to see that Coke a Cola is everywhere because people choose it. Same with Nike, GE products, and a whole host of other North American/European household brands. American Movies and TV shows are everywhere and China has literally built mini replica American/European cities to attract tourists. Not because they have been forced to, because they WANT to.

Most people have no clue about what an Empire is, and guys like Peter Schiff and others that subscribe to their line of thought have no idea of what is about to come next. China has no reserves without USDs and they are completely unprepared for the war they are going to have to fight. I mean, how can you have an international community, and one country that is an empire? Look at how Russia and China have vetoed UN resolutions. Look at how emerging markets have grown into a big chunk of GDP.

In short, am I worried about the global economy over the long term? HELL no. However, over the next several years companies that rely on it for growth are facing some major headwinds and savvy investors will recognize this for what it is; a buying opportunity.

[tyfighter3]

That's why the DOW is going down now and other stocks . Energy is one of the sectors that everybody needs and we should open up exports as soon as we can. Defence stocks should also do well. We should spend a billion in shoring up our Southern Border, then we don't need to spend Billions on wellfare on all of the mess we do have right now. The people in this Country had better WAKE UP and fast and that means all of our elected people that are in office right now, and it doesn't matter who they are because we wont have a country that will be a empire anymore. The Military needs new equipment, the F-16's are past there prime , it's like fix and repair daliy and how much more is there. The World is getting dangerous and if we can't control it now, I'm afraid that we are getting draged into something we wont be able to get out of then it wont matter how many Votes you get then.JMO

[Aman A.K.A. Ahamburger]

Ty, first I hear ya about the DOW, that's what I have been trying to warn people about for like 18 months. There could also be a broad base sell off before certain sectors rebound.

Second, you can't control the world, that's what I am saying. No one can. It's not mans to control, it's God's. Man is about to learn this lesson on a global scale and I think the other side is going to surprise. Why? Because it's about the Messianic Age(balance), not the end of the world.

I can understand you're emotional about illegal immigration, but there is no way that the entire welfare problem is because if illegal immigration. If you want to view the internal workings of the US as an empire that's fine, however that also makes Canada an empire, along with Australia, etc, etc. The only reason that it's remotely close to an empire is because of the social programs that have been ever expanding during the boomers generation. The good new there is that socialism is dead. Just look at the cheese thread on the politics board. The is NO more money for all the BS bureaucracy and it will take time to fix decades of bad policy. This won't lead to a collapse, it will lead to a strong and more efficient, country.

[tyfighter3]

I know, but I still can rant about it. lol

[Aman A.K.A. Ahamburger]

LoL, a good friend always understands where you're coming from and will try and talk ya down from the edge, lol.. I agree with you 110% that some need, and are going to get a wake up call.

[tyfighter3]

What I was saying was, you spend a Billion now in protecting the Border or we spend Billions later on, on what is happening now on our OPEN borders. I'd rather spend the Billion now. It's my money they are spending and everybody else's money too. I've got better places to spend my money than on people that don't need to be here illeagaly. And I'm sure it's not JMO only.

[Aman A.K.A. Ahamburger]

Boarder security is important for sure. IMO, spending the billion on making sure that illegals don't get hired and go after employers that do would help solve the problem.

[Aman A.K.A. Ahamburger]

Add another name to the list of analysts that have dropped growth projections for the year. These people should have been listening to me back in January.

IMF Cuts U.S. Growth Outlook, Sees More Scope for Zero Rates

[tyfighter3]

I think keeping them from crossing the Border would solve the problem. We have plenty of Laws on the books right now that if where inforced would solve the problem.

[Aman A.K.A. Ahamburger]

I'm not opposed to stronger boarder security, don't get me wrong. But you hit the nail on the head, the laws need to be enforced on people that are hiring. Take away the demand and the supply will dry up.

[tyfighter3]

Here's the point AHB, The US should load up all of the people that have crossed our Border illeagaly and put them onto buses and haul them up to the Cannadaian border and tell them to walk a mile north where the athorities will greet you and provide you with free medical, food, and housing for as lond as you wish. That sums up the point. That would take care of the Hiring problem and the supply would dry up here just fine.

[Aman A.K.A. Ahamburger]

Um what?

Ty, it was YOUR point that labor laws aren't being enforced in your country. Making shit up about Canada proves nothing and I have never said to not have better boarder security. All I have been saying is what you are saying, ENFORCE the labor laws. What I did was take it one step further by using the supply and demand formula and you seem to have taken that as me saying you should leave the boarder be.

Yes, I do believe that the billion you are talking about spending would be better spent ENFORCING labor laws, but that is because all they are doing is tunneling under it anyway. So, while I believe tightening up the boarder is a good idea, I know that cutting off the supply of jobs would be the most effective way to deal with the the illegal immigration problem.

For the record, no, shipping all the current illegals to Canada wouldn't dry anything up. Why? Because you guys would just hire more!