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The Wall Street Greek blog is the sexy & syndicated financial securities markets publication of former Senior Equity Analyst Markos N. Kaminis. Our stock market blog reaches reputable publishers & private networks and is an unbiased, independent Wall Street research resource on the economy, stocks, gold & currency, energy & oil, real estate and more. Wall Street & Greece should be as honest, dependable and passionate as The Greek.



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Seeking Alpha

Saturday, June 27, 2015

Does Greece Really Matter to U.S. Investors?

Greece
The answer is, well kind of. What matters to American investors are the factors affecting the American economy, U.S. industries and individual companies. External foreign issues can affect the U.S. economy, industries and companies, and in that way affect American investments and investor wealth. The Greece issue matters mostly because it could reverberate across the periphery of Europe. If Greece’s discontent carries over to Spain, Portugal or Italy, then it should affect the value of the euro in relation to the dollar; that has far reaching effects. Also, there’s risk in a Greek default because we do not know who owns Greek debt, which would go largely uncollected should the Greeks hit the reset button. Might the holders include American banks or important financial institutions overseas, and to what extent might it matter? Finally, fear alone, whether substantiated or not, could start a global stock market selloff; we have seen U.S. index futures taking the lead from Europe over the last several weeks on this intensifying Greece problem. That is not a good sign. See why Greece matters to U.S. investors.

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only. Article interests This article should interest investors in National Bank of Greece (NYSE: NBG), Hellenic Telecommunications (NYSE: OTE), Coca-Cola HBC (NYSE: CCH), Teekay Corp. (NYSE: TK), Navios Maritime Holdings (NYSE: NM), Navios Maritime Acquisition (NYSE: NNA), Navios Maritime Partners L.P. (NYSE: NMM), Tsakos Energy Navigation Ltd. (NYSE: TNP), Overseas Shipholding Group (NYSE: OSG), International Shipholding (NYSE: ISH), Excel Maritime Carriers (NYSE: EXM), Safe Bulkers (NYSE: SB), Claymore/Delta Global Shipping ETF (NYSE: SEA), Genco Shipping & Trading (NYSE: GNK), Diana Shipping (NYSE: DSX), Danaos (NYSE: DAC), Tsakos Energy Navigation (NYSE: TNP), Ship Finance Int'l (NYSE: SFL), Nordic American Tanker (NYSE: NAT), Seaspan (NYSE: SSW), General Maritime (NYSE: GMR), DHT Maritime (NYSE: DHT), Brunswick (NYSE: BC), Marine Products Corp. (NYSE: MPX), DryShips (Nasdaq: DRYS), Top Ships (Nasdaq: TOPS), Eagle Bulk Shipping (Nasdaq: EGLE), Sino-Global Shipping (Nasdaq: SINO), Paragon Shipping (Nasdaq: PRGN), K-SEA Transportation Partners (NYSE: KSP), Euroseas (Nasdaq: ESEA), Star Bulk Carriers (Nasdaq: SBLK), Omega Navigation (Nasdaq: ONAV), Knightsbridge Tankers Ltd. (Nasdaq: VLCCF), TBS Int'l (Nasdaq: TBSI), Golar LNG (Nasdaq: GLNG), Claymore/Delta Global Shipping (Nasdaq: XSEAX), American Commercial Lines (Nasdaq: ACLI), Deutsche Bank (NYSE: DB), ITA (Nasdaq: ITUB), Banco Santander (NYSE: STD), Westpac Banking (NYSE: WBK), UBS (NYSE: UBS), Lloyd’s Banking Group (NYSE: LYG), Barclay’s (NYSE: BCS), Credit Suisse (NYSE: CS), Allied Irish Banks (NYSE: AIB), Banco Latinamerican (NYSE: BLX), Bank of America (NYSE: BAC), Citigroup (NYSE: C), Goldman Sachs (NYSE: GS), JP Morgan (NYSE: JPM), Morgan Stanley (NYSE: MS), European Equity Fund (NYSE: EEA), Vanguard European Stock Index (Nasdaq: VEURX), Powershares FTSE RAFI Europe (NYSE: PEF), Europe 2001 (NYSE: EKH), S&P Emerging Europe (NYSE: GUR), Ultrashort MSCI Europe (NYSE: EPV), Vanguard Europe Pacific (NYSE: VEA), Wisdomtree Europe SmallCap (NYSE: DFE), Wisdom Tree Europe Total Div (NYSE: DEB), iShares S&P Europe 350 (NYSE: IEV), Morgan Stanley Eastern Europe (NYSE: RNE), DWS Europe Equity A (Nasdaq: SERAX), DWS Europe Equity B (Nasdaq: SERBX), Fidelity Europe (Nasdaq: FEUFX), Fidelity Europe (Nasdaq: FIEUX), ICON Europe A (Nasdaq: IERAX), Pioneer Europe Fund (Nasdaq: PBEUX), ProFunds Europe 30 (Nasdaq: UEPIX), Putnam Europe A (Nasdaq: PEUGX), Rydex Europe 1.25x (Nasdaq: RYAEX).

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Friday, June 26, 2015

Why ISIS’s New Currency Will Outlast the U.S. Dollar

ISIS currency


The Islamic State of Iraq and the Levant (ISIL), known to us as ISIS, has reportedly developed its own currency. Normally, you would expect the currency of a criminal and murderous state which is opposed by most of the civilized world, to be worthless. However, ISIS’s new currency is at least as viable as the dollar and could even outlast it; that is because it’s made of gold and silver.

Greek
Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

ISIS seems to have developed a viable currency. Syrian activists recently shared these images of the new currency via social media, but ISIS warned the world it was coming in November. It will be known as the “Islamic dinar” to its tragically misguided followers and perhaps morbid coin collectors. To the rest of us, it’ll be known as gold, silver and copper, and it will carry the relative and respected value of those precious metals (melted down of course).

ISIS is reportedly going to have two gold coins, three silver coins and two copper coins. It’s part of the group’s effort to establish and embed itself as a real bona fide nation. The coin is being modeled after an ancient dinar used during the Caliphate of the Uthman in 634 CE. ISIS cannot trade with dollars or euro, obviously, given its opposition to western civilization. It would not want to justify the civil order that its evil guides seek to displace. Who would believe the dollars weren’t counterfeit anyway? Gold is gold and silver is silver, no matter how bloody the money, and even ISIS should be able to trade with it. The coin shown in the image here is reportedly worth $139, determined by its weight in gold not its place of origin or any central bank manipulation.

How can this golden dinar outlast the dollar? Fiat currency like the dollar is basically given its value based on the viability of the country backing it. It’s a market determined relative value versus other currencies. It’s based on many factors including supply and demand, inflation, the credibility of the country issuing it, and the outlook for that nation’s economy and sovereignty; and some would say the manipulative efforts of its central bank.

The dollar is so strong today because the U.S. economy is the world’s most developed and the U.S. government is the world’s most stable. For as long as America goes unchallenged atop the world, the dollar will remain the strongest fiat currency. And since it is a relative value, it benefits today from weakness in other areas of the world.

However, as the world develops, the dollar must give way to it. Stagnant economies like Japan are still losing ground to the dollar, and the euro has its troubles today, but the development of the world has affected the dollar in a profound manner. In my view, it is the fate of the dollar to weaken over time, and the result of global development. As the rest of the world works its way to an even playing field with America, its currencies will gain ground against the dollar as well. Now, this may be decades or a century in coming, as the world’s governments continue to evolve from monarchies, dictatorships and other forms of inefficient managers of economic growth, but it should eventually come, in theory. I say in theory because before it comes, other disruptions are somewhat probable and could undermine fiat currency across the globe. You know what threats I speak of: war (most likely), global warming, asteroids from space, etc.

In such scenarios where the backing of an economy and government isn’t quite as important or even worth anything at all, what will mankind use to trade in goods and services? It will use a barter system, and in the place of goods, gold as a proxy. So, therefore, ISIS’ new currency could outlast even the all-powerful and supreme U.S. dollar. It was a no brainer for the caliphate wanna-be, and gold should be a no brainer for you and me as well for the same reason. Gold is mankind’s default currency, period.

In today’s society, where we expect everything to stay the same and we won’t allow ourselves to foresee risk of change, gold is influenced by many factors. It retains, however, currency value as evidenced by ISIS of all peoples. Gold is therefore a must own in every portfolio for the long-term. And investors today can own derivatives of gold and silver as well, via the shares of gold miners like Randgold Resources (Nasdaq: GOLD), and ETFs like the SPDR Gold Trust (NYSE: GLD), iShares Silver Trust (NYSE: SLV), Market Vectors Gold Miners (NYSE: GDX), and leveraged plays for short short-term bets or hedges like the Direxion Daily Gold Miners Bull 3X Shares (NYSE: NUGT). Nevertheless, there is no perfect replacement for real physical gold for the long-term holder, as evidenced by ISIS’s ability to trade with it. I cover gold and currency regularly and welcome readers to also follow my blog at Wall Street Greek and column at Seeking Alpha.

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only. Article interests Northrop Grumman (NYSE: NOC), Raytheon (NYSE: RTN), Alliant Techsystems (NYSE: ATK), Lockheed Martin (NYSE: LMT), Boeing (NYSE: BA), NYSE: IWM, NYSE: TWM, NYSE: IWD, Honeywell (NYSE: HON), General Dynamics (NYSE: GD), Rockwell Collins (NYSE: COL), Goodrich (NYSE: GR), L-3 Communications (NYSE: LLL), SAIC (NYSE: SAI), FLIR Systems (Nasdaq: FLIR), EMBRAER (NYSE: ERJ), Spirit Aerosystems (NYSE: SPR), BE Aerospace (Nasdaq: BEAV), TransDigm Group (NYSE: TDG), CAE (NYSE: CAE), Hexcel (NYSE: HXL), Esterline Technologies (NYSE: ESL), Teledyne Technologies (NYSE: TDY), Curtiss-Wright (NYSE: CW), HEICO (NYSE: HEI), Triumph Group (NYSE: TGI), Orbital Sciences (NYSE: ORB), AAR Corp. (NYSE: AIR), Kaman Corp. (Nasdaq: KAMN), AeroVironment (Nasdaq: AVAV), Smith & Wesson (Nasdaq: SWHC), DigitalGlobe (NYSE: DGI), GenCorp (NYSE: GY), Hawk (AMEX: HWK), LMI Aerospace (Nasdaq: LMIA).

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Another Fed Hawk Soils Stock Rally Durability

Last week, San Francisco Fed President Williams said “the rest of the year will be interesting” and that he was inclined to raise rates twice this year. That implied the Fed would liftoff with rate hikes starting in September. Today, Fed Governor Powell indicated the chances for liftoff were 50/50 for September, and that he would hike in September and in December. Friends, your long awaited Greece resolution-driven rally should be short-lived here as focus turns back to the Fed before long. See more on the Fed hawk's impact on stocks. Article interests Wells Fargo (NYSE: WFC), PNC Bank (NYSE: PNC), Morgan Stanley (NYSE: MS), Bank of America (NYSE: BAC), PowerShares QQQ (Nasdaq: QQQ) and more.

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

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Oh No He Didn’t?! – Fed-Man is Talking Trash

Stocks got a reprieve last week thanks to an FOMC dot-plot indicating a lower and later Fed Funds Rate hike timeline. But it’s time for a reality check. The Fed is going to raise rates this year, and it very well might do it twice before Christmas. So, the celebration expressed in stocks should be short-lived as investors reevaluate the Fed forecast. Fed members are making speaking engagements now that the FOMC meeting quiet period is over, and what some are saying is unsavory for stocks. So, while we may enjoy some upside near-term, it looks like investors will be wise to second guess by mid-August. See more on the Fed speaker stirring concern. Article interests SPDR S&P 500 (NYSE: SPY), iPath S&P VIX (NYSE: VXX), Financial Select Sector SPDR (NYSE: XLF), Bank of America (NYSE: BAC), Citigroup (NYSE: C), J.P. Morgan Chase (NYSE: JPM).

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

Phillies

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Tuesday, June 16, 2015

Bank of America – Why a BAC Breakout Happens on Lending Growth

May Motor Vehicle Sales offered fantastic evidence of robust business activity for Bank of America (NYSE: BAC). That fact is not just because the bank does a good deal of auto lending generally, but because it implies banks and BAC are lending more freely now after meeting the Fed’s raised capital requirements. While the interest rate outlook is certainly a support for the banks, this driver of lending activity will serve the top and bottom lines in an important manner. Thus, Bank of America remains of one my favorite long ideas. See the report on BAC here.

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

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Merkel vs. Obama - A Game of He Said She Said

Last week, a rumor supposedly leaked from a French government representative indicated President Obama said that the current strength of the dollar was problematic. The dollar weakened on the news, which would serve the U.S. Federal Reserve’s ability to begin its monetary tightening plans; that in turn serves the economy long-term. The President had to deny ever saying it, given its unpatriotic connotations, but I’m sure many market players still believe he said it; and it has impacted the dollar in my view. This morning in Germany, it seems the German Chancellor fired a salvo back onto the currency battlefield. Angela Merkel said a strong euro was not a good thing for nations on the periphery of the eurozone economy. In speaking on the euro and in sharing her indicated preference for current weakness, the dollar recovered some of that previously lost ground and the battle was balanced again in the stealth currency war between trading partners. Though working now into the late Friday afternoon, the dollar is back near where it started the day. See my report He Said She Said. Article interests ProShares Ultra Short Euro (NYSE: EUO), CurrencyShares Euro (NYSE: FXE), PowerShares DB US Dollar Bull (NYSE: UUP), PowerShares US Dollar Bear (NYSE: UDN). 

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

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Tuesday, June 09, 2015

The Buy Gold Lie

In a market report published today I discussed a series of erroneous news leaks that have misled financial markets recently around the dollar/euro trade. The same issues have influenced the price of gold in dollar terms. Thus, the case for gold made recently by the bid is based on false promises and should correct. See my report on gold here. Article interests SPDR Gold Trust (NYSE: GLD), Market Vectors Gold Miners (NYSE: GDX), Market Vectors Junior Gold Miners (NYSE: GDXJ), iShares Silver Trust (NYSE: SLV), Direxion Daily Gold Miners Bull 3X (NYSE: NUGT), Direxion Daily Gold Miners Bear 3X (NYSE: DUST), Newmont Mining (NYSE: NEM), Randgold Resources (Nasdaq: GOLD), Barrick Gold (NYSE: ABX).

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

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Obama's Dollar Diss & EU Market Manipulation

In the wee hours of a solemn Monday morning as I scribbled my thoughts for followers, sometime around 4 AM EDT, I noted a sharp drop in the dollar index. As I scrambled to figure out what had happened to cause the counterintuitive decline, I found what stank of European desperation. In fact, I noted that a series of public statements over the past couple trading days had illustrated that the Europeans are desperate to prop up the euro against a strengthening dollar. As Greece appears headed for a nightmarish scenario for the eurozone, it shows just how concerning the situation really is. However, no matter how much noise is mixed into the trading, the key catalyst for dollar gains remains and it will drive the dollar higher. See my report on the dollar here. Article interests PowerShares DB US Dollar Bullish (NYSE: UUP), CurrencyShares Euro Trust (NYSE: FXE), ProShares UltraShort Euro (NYSE: EUO), Global X FTSE Greece 20 (NYSE: GREK), SPDR S&P 500 (NYSE: SPY), PowerShares DB US Dollar Bearish (NYSE: UDN) and iShares Euro ETF (NYSE: EURS).

DISCLOSURE: Kaminis is long UUP. Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

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Chaos Theory in Today’s Market

A series of events late last week seem to have reintroduced a chaotic perspective for June. I expect the developments will shortly reignite fear if not introduce terror. The two chaotic catalysts are not new to us, but fear of a fast Fed rate hike and a Greek departure from the eurozone are scarier than ever. Investors who may have been worried about the virility of the U.S. economy received a different message Friday. It was the sort of message that might not mix well with recent signs of inflation. We got a very hot jobs figure to allay our concerns about a slowdown; but in return we now have a building sense of fear of a June Fed rate hike. Adding fuel to the flames, just when you all thought Greece and its supposed allies were coming to accord, the situation unraveled. The Greeks have smartly delayed their IMF payment due last week and brazenly rejected the seemingly best offer of their eurozone masters. Meanwhile, Greece is again courting an unholy alliance with Russia to show the west it has other options besides decades of depression and discord. So now we have two very worrisome issues to trouble us for most of this month, with each due to come to a head in the coming weeks. Fear has been reignited dear friends – so take heed. See my market report here. Article interests SPDR Dow (NYSE: DIA), PowerShares QQQ (Nasdaq: QQQ), SPDR S&P 500 (NYSE: SPY), Vanguard Total Market (NYSE: VGK), iShares MSCI Germany (NYSE: EWG), Global X FTSE Greece 20 (NYSE: GREK), iPath S&P 500 VIX (NYSE: VXX).

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

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Monday, June 01, 2015

Greece is the Boy Who Cried Wolf

"We are very near an agreement" is something Greece's PM said on Wednesday and his finance minister has repeatedly stated. Yet, like a geometric shape that approaches its axis but never reaches it, no deal has ever resulted. Still, for some reason the global markets believed the smiling PM as he once again assured his own populace and everyone else who was listening that we're almost there. I've come to realize that much of what is behind this banter is political in nature, as back home the new government has been under the high heat since its entry into office. Every political party Greece now has to offer, with many now seeking to replace the crisis crippled PASOK and New Democracy parties, is blaming Syriza for completing the job Greece's old guard began. Syriza's head, Alexis Tsipras, has to present a positive and strong image to a nation that might be having second thoughts about their decision to elect him. In the end, no matter how many times Greece cries wolf, though, it will eventually have to slay the monster or be devoured by it. This game cannot go on forever, because Greece is about to run out of money. See the report on Greece. National Bank of Greece (NYSE: NBG), Global X FTSE Greece 20 (NYSE: GREK), Piraeus Bank (OTC: BPIRY).

Disclosure: Kaminis is short NBG. Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

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Dollar Resurgence – How to Capture Greenback Gains

The dollar's resurgence of the past week has momentum and is built on substance. Since marking a recent bottom in mid-May, the dollar index spot exchange rate has increased over 4% into May 26 trading. I believe the move was ignited by renewed concern about the euro due to an intensification of concern about Greece. It has been supported by other recent events about the dollar and euro, but it is the Greece issue that I believe gives the move substance and momentum. If you agree, you might use the PowerShares DB US Dollar Bullish ETF (NYSE: UUP) to hedge against any relative risk or to capture the activity, and/or derivatives of the UUP to speculatively capitalize on the move. See the report on the dollar.

Disclosure: Kaminis is long UUP. Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

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Sunday, May 31, 2015

Why Sell in May Makes Sense this Year

The old adage, "Sell in May and walk away," may apply this year more than most. While we are through the month now, the adage actually applies to the period from May 1st through October 31st and implies that stocks tend to underperform versus the other six-month period from November through April. There are several substantive macro factors at play against stocks in this year's period. First of all, according to the Federal Reserve, it could raise interest rates at any of its upcoming monetary policy meetings, marking an important shift in policy. Concern about the repercussions of this on stocks has time and again impacted equity values in the recent past. Inflation seems to be heating up as well, and it could add impetus to the Fed's tightening plans. Secondarily, there's the intensifying concern about the economy and whether first-quarter weakness is something more than seasonal. Also, the European situation is coming to a head finally, and it appears a Eurogroup deal with Greece will not happen until the midnight hour, if at all. The Islamic State has apparently made a very direct threat to the U.S. recently that applies coincidentally to the next six months and could make for volatility. As a result, if ever there was a May to walk away from, it seems this one would be it. Read my report on Sell in May. SPDR S&P 500 (NYSE: SPY), SPDR Dow Jones (NYSE: DIA), Powershares QQQ (Nasdaq: QQQ), iShares Russell 2000 (NYSE: IWM), Vanguard Total Market (NYSE: VTI), iPath S&P VIX (NYSE: VXX).

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

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Chipotle (CMG) - Uncertainty Not Worth the Price

Chipotle Mexican Grill (NYSE: CMG) dropped 5.4% in after-hours trading after reporting its earnings. The company beat Wall Street expectations on the bottom line by 22 cents, but reported lower sales than expected and warned about a pork shortage that would affect its sales moving forward. The company also missed expectations for comparable store sales, and comparable sales are expected to moderate in pace significantly in 2015. The stock was valued richly heading into its earnings report. Thus, these new issues, which threaten to continue to drag on operational results this year, should cause investors to reassess and relocate capital. See my report on Chipotle (CMG).

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

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Part II: The Real Catalyst for Recent Volatility

In Part I of this two-part series, I discussed the reasons that were popularly attributed to a recent market decline (in April). I indicated that despite my appreciation for the famous trader who voiced the list of catalysts, that when many reasons are given for market or stock activity, it usually indicates a lack of understanding for the one true catalyst. At the close of the report I promised to provide the real catalyst for recent volatility, so here it is – the third consecutive monthly uptick in inflation as indicated by the Core Consumer Price index. Sounds bizarre to some of you I’m sure, but the fact is that the market has reacted poorly to this data point more than once recently. That is because it threatens to raise Fed interest in a more rapid monetary policy tightening scheme. See my full stock market report – SPDR S&P 500 (NYSE: SPY), SPDR Dow Jones (NYSE: DIA), Powershares QQQ (Nasdaq: QQQ), iShares Russell 2000 (NYSE: IWM), Vanguard Total Market (NYSE: VTI), iPath S&P VIX (NYSE: VXX).

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

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Monday, April 20, 2015

The Real Reason for Friday’s Stock Shock – Cashin’s 3-Prongs Missed the Mark (Part I)

As I listened to Art Cashin’s reasons for why stocks were set to open lower this past Friday I paused for a moment. Whenever I hear anyone, even the beloved Cashin, give multiple reasons for an acute movement in stocks, I grow skeptical. For me, the listing of many varied reasons for something is a sign that the person speaking may not understand the true catalyst. I listen closely when Cashin speaks, which is quite different than the attention I give most TV personalities. However, the real reason for Friday’s stock shock was not any of the three reasons Art listed. All three were ancillary to U.S. equity trading and not important enough to create such a significant downdraft. See my full report here.

Article interests SPDR S&P 500 (NYSE: SPY), SPDR Dow (NYSE: DIA), PowerShares QQQ (Nasdaq: QQQ), iShares Russell 2000 (NYSE: IWM), Vanguard Total Market (NYSE: VTI), iPath S&P VIX (NYSE: VXX). Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

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Thursday, April 09, 2015

The Four Horseman of Stock Market Apocalypse

While a doomsday like stock market crash is unlikely in my opinion, the market is ripe for volatility now. Four main issues trouble me today that I believe are worthy of concern. Ironically, volatility is cheap to buy now, so I suggest investors hedge market volatility risk today via the iPath S&P 500 VIX (NYSE: VXX) and instruments like it. See my full report on the 4 Horsemen of the Stock Market Apocalypse here.

Investment Sector Security
04-08-15 1:40 PM ET
SPDR S&P 500 (NYSE: SPY)
+0.3%
SPDR Dow Jones (NYSE: DIA)
+0.1%
PowerShares QQQ (Nasdaq: QQQ)
+0.6%
iShares Russell 2000 (NYSE: IWM)
+0.7%
Vanguard Total Stock Market (NYSE: VTI)
+0.3%

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

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Wednesday, April 08, 2015

TODAY’S MARKET – Aliens, Robots and Conspiracy Theory

crazy eyes
Overseas markets greeted us today with a smile, but will we return the favor? China cut taxes on resources and energy to spur its economy and Japan kept to its extreme easing measures. Alexis Tsipras left his meeting with Vladimir Putin and appears to be intact, though we’re still watching him for signs of being a robot or an undercover alien. I’m not sure if this kind of thing only happens on Air Force 1 flights or if the Kremlin is capable too; after all, Ohio Senator Dennis Kucinich was never the same pesky politician after his perhaps life altering flight with President Obama, a.k.a. Orpheus Magnum. Just kidding… or am I?

hottest man on earth
Our founder earned clients a 23% average annual return over five years as a stock analyst on Wall Street. "The Greek" has written for institutional newsletters, Businessweek, Real Money, Seeking Alpha and others, while also appearing across TV and radio. While writing for Wall Street Greek, Mr. Kaminis presciently warned of the financial crisis.

Today’s Stock Market


Global Markets


At the open of U.S. trading, European ETFs were trading sharply higher, I suppose on the fact that the Greek PM didn’t break out of Moscow with a groundbreaking announcement. Japan was up after the BOJ kept to its QQE plan. China is soaring today after it announced it would cut resources tax and power prices to boost its economy.

EUROPE
%
ASIA/PACIFIC
%
Vanguard FTSE Europe (NYSE: VGK)
+1.0%
Precidian MAXIS Nikkei (NYSE: NKY)
+0.7%
iShares MSCI UK (NYSE: EWU)
+1.7%
SPDR S&P China (NYSE: GXC)
+5.6%
iShares MSCI France (NYSE: EWQ)
+0.6%
iShares Asia 50 (NYSE: AIA)
+2.2%
iShares MSCI Germany (NYSE: EWG)
+0.4%
iShares MSCI S. Korea (NYSE: EWY)
+1.4%
Global X FTSE Greece (NYSE: GREK)
+0.1%
iPath MSCI India (NYSE: INP)
+1.0%

There’s a lot going on. The Bank of Japan (BOJ) issued monetary policy and the Greek Prime Minister is in Moscow exploring alternatives while his Finance Minister is in the United States doing the same. It’s smart play by the Greeks and fits the FM’s game theory expertise. The Europeans are probably shaking in their boots right now and readying to give in just enough to keep the Greeks in tow.

The BOJ stuck to its plan of QQE or Quantitative and Qualitative Easing, which includes purchases of J-REITs and Japan relative ETFs, but inflation was stagnant thanks to lower energy prices. This was as expected. The BOE today said Europe needs to prepare for a Greece exit; the BOE issues monetary policy on Thursday.

U.S. Stock Market


Sector Security
04-08-15 Open
Vanguard S&P 500 (NYSE: VOO)
+0.4%
iShares Dow Jones (NYSE: IYY)
+0.3%
Fidelity NASDAQ  ETF (Nasdaq: ONEQ)
+0.1%
ProShares Ultra Gold (NYSE: UGL)
-0.4%
ProShares Ultra Real Estate (NYSE: URE)
+0.2%
ProShares Ultra Oil (NYSE: UCO)
-3.5%
WisdomTree US$  Bullish (NYSE: USDU)
-0.7%
iShares 20+ Yr. Treasury (NYSE: TLT)
-0.2%

Stocks opened higher in the U.S. despite Tuesday’s late day decline. The SPDR S&P 500 (NYSE: SPY) was up fractionally. There’s nothing much new to report about Yemen, save for the fact that Iranian ships are reportedly heading there. We do not want to see Iranian forces engage Saudi Arabian forces, which is the reason why oil prices spiked yesterday. The market is in wait-and-see mode on that factor, but we have the Fed meeting minutes later today, and they are more likely to hurt us than help us. Put on some volatility hedges using the iPath S&P 500 VIX (NYSE: VXX) or similar instruments, as volatility is cheap now and there are many mines we might step on.

Economic Reports


TODAY’S ECONOMIC REPORT SCHEDULE

Economic Data Point
Prior
Expect
Actual
WEDNESDAY



4.6%

+0.4%



-Crude Oil Inventory
4.8MB


-Gasoline Inventory
-4.3MB








Greek PM Meets Putin




The Federal Reserve’s FOMC Meeting Minutes steal the show today, given all the Fed betting going on these past two years. Even while the Fed comes up with reasons to avoid raising rates, the minutes of the meeting allow all voices to be heard. Oftentimes, this sharing of information causes a stir in the market, because it always reflects a spectrum of views, including the scariest (usually from Jeff Lacker). Today could thus spread the volatility we saw toward the close yesterday.

The EIA Petroleum Status Report will one day soon share different information. Eventually, it will show draws from inventory as we approach the summer driving season. This time around forecasters expect another build, which should measure about 4.8 million barrels according to the consensus. Oil prices have been rising, mostly because of the chaotic situation in Yemen. If not for Yemen, oil prices would likely be falling on the Iran deal, or prospect of an Iran deal since there really is not a deal yet.

The weekly mortgage application data should be ignored this week given the MBA’s issues in accurately adjusting for three-day weekends and around holidays.

EPS Reports


Earnings season starts today, informally, with the report of Alcoa (NYSE: AA). Otherwise, the list of reporters today is short. Earnings start next week in earnest. Today’s reports include Pier 1 Imports (NYSE: PIR), which back in the day was a barometer of housing; at least it was Peter Lynch’s barometer and that’s good enough for me. Similarly, Bed Bath & Beyond (Nasdaq: BBBY) reports today. Expect the retailers of goods to do great generally now; I’ll have more to say about why later either here or one of my other columns, which you can follow via my Twitter or Facebook or one of my other distribution methods (visit the blog).

HIGHLIGHTED EPS REPORTS
Company
Ticker
WEDNESDAY

Alcoa
NYSE: AA
Alcobra
Nasdaq: ADHD
API Technologies
Nasdaq: ATNY
Apogee Enterprises
Nasdaq: APOG
Bed Bath & Beyond
Nasdaq: BBBY
Family Dollar Stores
NYSE: FDO
Global Payments
NYSE: GPN
Mistras Group
NYSE: MG
MSC Industrial Direct
NYSE: MSM
Northern Technologies Int’l
Nasdaq: NTIC
OMNOVA Solutions
NYSE: OMN
Pier 1 Imports
NYSE: PIR
Resources Connection
Nasdaq: RECN
Richardson Electronics
Nasdaq: RELL
Rite Aid
NYSE: RAD
RPM International
NYSE: RPM
WD-40
Nasdaq: WDFC

TODAY’S MOST ACTIVE STOCKS
BIGGEST GAINERS
% Gain
AMCN AirMedia Group (Nasdaq: AMCN)
+78%
Kingtone Wirelessinfo (Nasdaq: KONE)
+54%
China Natural Resources (Nasdaq: CHNR)
+37%
Yanzhou Coal Mining (NYSE: YZC)
+24%
Second Sight Medical (Nasdaq: EYES)
+19%
EnerJex Resources (Nasdaq: ENRJ)
+14%
Zep (NYSE: ZEP)
+17%
Taomee Holdings (Nasdaq: TAOM)
+15%
Regulus Therapeutics (Nasdaq: RGLS)
+14%
American Electric Tec (Nasdaq: AETI)
+8%
BIGGEST LOSERS
% Drop
QAD (Nasdaq: QADB)
-12%
Data I/O (Nasdaq: DAIO)
-10%
Flamel Technologies (Nasdaq: FLML)
-15%
Cinedigm (Nasdaq: CIDM)
-6%
MYOS Corp. (Nasdaq: MYOS)
-9%
Cellular Biomedicine (Nasdaq: CBMG)
-5%
Yuma Energy (Nasdaq: YUMA)
-5%
Sysorex Global (Nasdaq: SYRX)
-8%
Swisher Hygiene (Nasdaq: SWSH)
-7%
Video Display (Nasdaq: VIDE)
-7%

Please see our disclosures at the Wall Street Greek website and author bio pages found there. This article and website in no way offers or represents financial or investment advice. Information is provided for entertainment purposes only.

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