Faith and experience have proven to me that an intelligent income investing strategy will build real wealth. Here’s how.
Another day, and still no agreement on a 2011 budget
in Congress. Surprisingly though, the stock market is not really being
affected by the impasse. Sure, the major indices are down slightly again
today, but I think we can all imagine that it could be much worse.
Treasury bond prices have been choppy, with big $3 price swings on the
chart of the iShares Barclays 20+ Year Treasury Bond ETF (TLT) in July. But
overall, bonds are holding up well, and this tells us clearly that no one
expects the U.S. government to default on its bond payments.
To wrap up this week, I decided to respond to some
On Tuesday The Financial Times reported that
A story by Robert Lenzner in Forbes Magazine today outlined the potential
for silver to go as high as $50 an ounce in the near future.
With silver on the march from year to date lows of just over $15 an ounce
all the way up to recent highs of over $30 an ounce, it’s been one of the
best performing asset classes of the past year – and even the past
$1,390 an ounce, gold prices are at an all time. Silver is at a 30-year
high. Agricultural commodities like fertilizer are also moving toward new
Economists are warning that these commodities could continue to move
higher in price for several months. And the stocks of companies selling
these commodities have been surging in the past few trading sessions.
According to a recent report by the United Nations Food and Agriculture
Organization, the world will require a 70% increase in food production in
the coming years.
In order to grow food production fast enough to match population growth,
agriculture markets will require an average of $209 billion in additional
In difficult economic environments, when the stock market
seems to move with little rhyme or reason, investors will sometimes say “it’s
a stock pickers market.”
The idea of a “stock picker’s market” is that of a trendless
market, but one where you can still buy quality, undervalued stocks and make
But according to the
Wall Street Journal, that’s not what we have right now. And
investors who are relying simply on a company’s fundamentals to invest are
not being rewarded with profits.
Stocks have been unable to make any headway over the past
few sessions. And late-day sell-offs have been a common theme.
I often refer to oil prices as a proxy for growth
expectations. And with oil prices set to drop below $72 a barrel today, it’s
clear that investors are not bullish on growth. Of course, recent economic
data has indicated that economic activity in the U.S. has slowed down.
Perhaps the biggest drag on the economy is housing. That’s
nothing new. But New and existing home sales have been weaker than expected
after the expiration of the homebuyer tax credit in April.
If you’ve invested in ETFs over the past few years – you’ve
probably lost money.
I know it’s not news to you, but the simple fact is that most ETFs were never
designed to succeed for individual investors – they were designed to do only
one thing: line the pockets of the Wall Street big shots with the brilliant
idea to sell “easy” investments to Main Street investors.
It’s simple to see why: they make between 0.5% and 1.0% regardless of what
the ETF does. Just another Wall Street con job.
Good investments are rarely easy, and although ETFs seem like a no-brainer,
that’s because most of them were specifically designed to appear that