Every year, I go to the Agora Financial Investment Symposium in Vancouver, both as speaker and attendee. It's jampacked with people from all over the world who gather at the Fairmont Hotel to share ideas. As soon as I walk into that grand old railway hotel, I know there will be some surprises. This year was no different.
Ideas were not in short supply, but some ideas were more common than others. More than a few speakers spoke well of gold and oil. Most had dim views of the economy and the hot stock market of 2011. And there were at least a handful whose best ideas hailed from some emerging market.
A couple of my favorite ideas came from investors based in Dubai and Moscow. Whole markets rarely go on sale, but here we have two examples of hot stock markets trading for about 6 times earnings.
Peter Cooper is our man in Dubai, as you may remember, and a friend of mine. From his perch in Dubai, he writes an interesting investing newsletter called ArabianMoney. He is also a self-made millionaire who made it in the Middle East. He sold out near the top. But now, Peter says Dubai is a buy again. In fact, Peter says, the whole United Arab Emirates is a buy.
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On the table are a number of small steps...and one big one.
Barron's highlights the big one on this week's cover:
"Why the Fed will soon print $2 trillion," is its headline. The idea behind the headline is simple enough. The recovery is a flop. All that stimulus spending has done nothing. Unemployment is not getting better. Consumers aren't shopping. Banks aren't lending. And the money supply is actually falling.
What to do? The Fed has already shot off its monetary ammunition. It has been lending money without asking anything in return for the last two years. What else can it do?
Well, it still has some weapons it can use. Quantitative easing, for example.
Read more and comment ...1. The long-term trend back towards consumer frugality and higher savings rates remains in full force. This will dampen consumer spending.
2. A double dip in housing prices is likely, because subsidies are ending and the backlog of foreclosure resolutions is about to accelerate.
3. The impact of the Obama administration's stimulus plan is fading, and is not leading to any real "multiplier" effects because most of it went to plug holes in state government budgets.
4. European and Chinese GDP are slowing for well-publicized reasons.
5. Those who create jobs in the US fear rising tax rates in 2011, rising energy prices from cap-and-trade legislation, the pro-Wall Street "financial reform" bill, and a laundry list of other anti- business policies.
Read more and comment ...Inviting a little bit of government policy to interact with private enterprise is like inviting a little family of rats to interact with a bakery. Before long, you've got more rat droppings than chocolate sprinkles atop your cupcakes. And that's just the beginning...
Every day, the rats are more numerous, more rotund...and more brazen. Every day, fewer baked goods make it from the oven to the display case. Eventually, the baker is in business to feed the rats...and there is nothing he can really do about it.
Feeding rats is expensive.
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Top Stocks For 2012: China
By Toby Smith
Growth stock specialist Toby Smith turns to a speculative micro-cap stock for his top pick for 2012:ChinaTel Group, Inc. (Other OTC: CHTL).
With the added disclosue that he personally own shares in CHTL, along with his clients at ChangeWave Research, the advisor looks to the firm's potential role in a new joint venture in the
"Our bullishness is based on a pending China Tel and Chinacomm joint venture as a 'basic telephone service' (BTS) licensed carrier in
"The Chinacomm/ChinaTel joint venture owns 37,000 kilometers of fiber-optic network and 3.5Ghz spectrum for wireless broadband in 29 of the biggest
"ChinaTel has su?ered a great credibility problem on the Street due to a set of failed capital raising deals that failed to close.
"But the delays in their closing equity financing over the last 18 months has turned out to be a blessing in disguise, as the potential valuation for the China Wi-Max network has at least doubled since the previous failed deal.
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