07/12/2012: GARY ON NATIONALLY SYNDICATED INVESTORS EDGE RADIO BROADCAST
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https://archives.warpradio.com/btr/InvestorsEdge/071218.mp3
JUST LETTING YOU KNOW
Sit Back, Feet Up
Throughout the years, there has been a massive list of names that I have brought up for you on my show. I would basically say the same thing about all of them. No revenues. Loses a lot of money. Touted too much. Being promoted by bad guys.
For most part they have gone by the wayside. A lot of them have gone to zero.
So it’s very important that you recognize these things. It’s really not hard to figure out.
Sometimes, it’s the one product company. The one drug company.
Sometimes, it’s a company that has not revenues, but he stock keeps going higher and higher.
And we’ve had weird ones. And admittedly, I’ll miss the moves. There was a stock called Broadvision. Remember BVSN? The stock was trading 10,000 shares a day and it was trading at 8. And out of nowhere, even though nothing had changed for the company, the stock went from 9 to 56 in a matter of 4 to 5 months. At 56, it had a monstrous marketcap, even though the company had $16 million in revenues and lost a $1.20 a share, which means it loses $5 million.
It’s back down to 10. And I’ll be the first to admit it. I didn’t make any money on it. But I tend to know outcome. I don’t know if the company was promoted and bad people where in it. I don’t know what happened.
Just watch yourself. There’ll be a lot more of these going forward. Your job, first and formost is to stay the heck out of them.
Today’s Market
How do I put it? Futures were down big. They rallied it up to where the Dow was up 20. The Nasdaq never really had a good feel. And then they sold it off in the last 10 minutes…a change from what we’ve seen in the past couple of weeks. But still, it’s just really “blah” action. The lazy days of summer. It’s action that’ll drive you up the wall. Just be very, very careful.
We are entering earnings season tomorrow. Wells Fargo and JP Morgan are reporting.
Next week a thousand companies will be reporting. The week after…2000 or 3000 companies. During those two weeks, just about everybody. During those two weeks, just about everybody will be reporting.
The goal is very simple. Sit back, feet up. And just watch the reactions to the earnings that come out.
What I’m continuing to see in the market is the weak Euro / strong Dollar which continues to affect those dollar plays, namely IBM was down another 2 and change today. They rode the weak dollar and now they’re riding down the strong dollar. If you’re wondering why, Google, “Why multinationals do less well on a strong dollar?” and you’ll find some explanations.
Just a very tough market and I’m playing it very lightly, keep close stops in place.
There’s be another fat pitch, although unfortunately all the fat pitches the past two years have only last eight weeks. It has been that tough.
How long this last and how far it goes, I don’t know. But typically what I’m doing is that anything that breaks the 10-week/50-day moving average with volume or anything laying below it – is off list eyesight. Remember, something that cannot go up if it is below those moving averages. It is a physical fact of life.
Life is easier for me, because fewer and fewer names are above that level. Today, a few held that level as they pulled back. But also today, more names broke through that level which is not good news.
There’s worry, believe it or not, that the Fed’s not going to do anymore.
That’s the big worry. Great. Little do that they know, the best thing that can happen for the markets, is for the Fed to take a vacation that lasts a very long time. Because the constant interference and manipulation of the markets are not good for the long term health of the markets.
The markets should be free to do their own bidding.
But that’s not possible right now is it?
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Gary Kaltbaum owns Kaltbaum Capital Management, LLC (“KCM”), an investment adviser registered with the U.S. Securities and Exchange Commission. The opinions expressed herein are those of Mr. Kaltbaum and may not reflect those of KCM. The information offered in this publication is general information that does not take into account the individual circumstances, financial situation or individual needs of an investor. The information herein has been obtained from sources believed to be reliable, but we cannot assure its accuracy or completeness. Neither the information nor any opinion expressed constitutes a solicitation for the purchase or sale of any security. Any reference to past performance is not to be implied or construed as a guarantee of future results.