Super Stock Blog

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Month: February 2009

Dollar Cost Averaging Down

We know the economy will eventually get better.  We are seeing things at the worse: the interest rates have hit bottoms never seen before, job rates are at all time lows, the stimulus package will take at least 6 months to start getting into effect, the stock market is hitting lows seen from year 2000.  The DOW has continued its drop, now hitting below 7400.  Many advisors assume that the market will drop below 6500 before things get better.   One of the reasons is in April, many of the ARM loans will get reset.  We will see another huge round of foreclosures, and the result is more lows for the DOW.

I suggest right now is a great time to just hold your money or buy some commodities such as gold.  If you have a 401k, it’s a good time just to continue your dollar cost averaging down.  You might as well just stay on the sidelines and let the things unravel while building your nest or paying off your debt.

Getting Serious with Sirius

Sirius/XM Radio, SIRI, has dropped to an all-top low last week at $0.05.  Yesterday, it made a whopping increase of 60% and ended the day at $0.16.  This was triggered by a loan made by Liberty Media.  This helps prevent Sirius from filing bankruptcy and gives it more time to find a buyer.  This also gives Mr. Malone, Liberty Media’s chairmen, ownership stake in the company.  Liberty Media also owns DirectTV.  It be interesting to see what type of partnerships and deals come out of Sirius/XM Radio with their satellite packages.  I see this stock moving up from here on.  Even Dish was interested in this deal, but lucked out when DirectTV helped them out.  I see plenty of potential in this stock.  At $0.016, you have a lot more upside than downside.  Buy 1,000 shares and wait a few years, let’s see what happens 😉

Where is the Bottom?

Oil has not reached the bottom yet, the dow hasn’t reached the 6500 point mark yet, where is the real bottom?  Of course looking at 2008, this is not a bad time to buy stocks if you are looking long term.  But buying at the bottom and timing the market has always been a losing proposition.  When people wait for the bottom, they will always miss the timing and miss the big stock hikes when it does happen.  This recession will be different though.  We have multiple banks getting bailed out and companies getting funding through the stimulus.  It will take at least a few years to get out of this mess.  In 2006, multiple countries starting slowing their funding into the U.S. Treasury and putting their money into other countries.  China slowed down their funding and is now continuing to grow their domestic products.  Europeans are putting less money in the US banks and also are putting it into strong currencies such as the Swiss Franc.

We are not in any normal recession.  From my advisors, they have suggested we will have one more drop in the stock market.  It appears it will happen sometime this summer.  ARM loans will soon expire in April, more foreclosures, more bankruptcies, more people in the gutter.  Take your time, be patient, and if you do wish to invest, get into commodities such as gold and wait it out!

Mueller Water Products on the Cheap

Water infrastructure is looking to be a rather important function going forward in the United States.  Clean water is not only an essential part to living, but also something that is declining at a rapid rate.  The funding needed to replace existing old infrastructure has been lacking.  Barack Obama has stated that one of his goals is to use federal funding to help fix roads, bridges, utilities, and you know for sure part of his stimulus package will be for helping fix these water problems.

Mueller Water Products, MWA, got knocked down to $4.22 from $6.66 on Wednesday.  Currently, it is at $3.33 this morning.  It got as high as $7 earlier this week.  At this price, it’s at the point of hitting a bottom.  The price can only go down furthur if there is no funding to help the infrastructure.   Possibly worst-case scenario, there’s a few quarters to which this might happen, but once people realize the importance, this stock will hit double digits in no time.  Obama wants to put people into jobs and helping improve the water situation will not only benefit the country nationally it will help improve the mess of an unemployment market.