01-27-2012

Orders for US durable goods rose more than forecast in December, figures just out show. This is the latest in a series of indicators that suggest the US economy is recovering. While it is true that the pace of recovery is among the slowest ever after a recession, it is nice to have some good news and some hope for the future after a fairly ugly year in 2011. Now is a good time to be investing in US stocks, methinks.

01-25-2012

Oil prices, and oil company stock prices, are rising as tensions increase between the US and Iran. However, this is a one-off and temporary situation and oil prices won't be sustained at current levels until global growth prospects pick up. Given the length of time it will take for Europe to get its act together, and the probability that Japan's economy is shrinking, means the prospect of a continual firming in oil prices is unlikely. Investors should treat the current political uncertainty as an opportunity for some momentum trading, but be prepared to take profits quickly.

01-16-2012

The downgrade in credit ratings of many European nations, while unsettling, should not be a huge surprise. The extent of problems with sovereign and bank debt in some countries is such that default and withdrawal from the European Union is the most likely scenario. No doubt there will be a lot of squawking and flapping before that reality is realised.

12-16-2011

I have been updating my financial models today, plugging in updated earnings estimates, prices and anticipated growth rates. There are few outstanding investment opportunities presenting themselves right now and, given we are close to the holidays, the potential for the recent support level in share markets to not to be held and yet more uncertainty in Europe, now is not the time to be throwing a lot of money into equities. Far better to increase your cash and hit the beach with peace of mind.

12-14-2011

Gold prices have been sliding in recent days, raising concerns in some quarters that the 11 year-long gold boom is over. However, it is equally likely that we are in a regular dip that may only be temporary. The US$ has strengthened recently as investors move away from Europe and this has reduced the dollar value of gold. However, buying by China is running at record levels and Indian buyers, who have been out of the market for some time, are said to be taking advantage of the current dip to buy. I believe that, as long as central banks continue to print money to try and solve their problems, that gold will go up in value. Look for the dip to bottom out then buy some more.