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Steve Cook on Disciplined Investing

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Economics

   This Week’s Data

    The International Council of Shopping Centers reported weekly sales of major retailers up .1% versus the prior week and up 1.3% versus the comparable period in 2007; this is its strongest performance in six weeks. 

    Redbook Research reported month to date retail chain store sales down .4% on a year over year basis--its best result in four weeks.

    Auto sales fell off a cliff in November:
    http://www.ritholtz.com/blog/2008/12/auto-sales-plummet-again/

   Other

    A positive outlook in an otherwise dismal economic environment:
    http://www.american.com/archive/2008/december-12-08/pax-americana-isnt-over-yet

    Calculating the total bailout cost:
    http://www.ritholtz.com/blog/2008/12/calculating-the-total-bailout-costs/

Politics

  Domestic

Get ready for card check:
http://www.clubforgrowth.org/2008/12/get_ready_for_card_check.php


    Shelving the windfall profits tax; score another for Obama:
    http://www.reuters.com/article/vcCandidateFeed2/idUSTRE4B206W20081203

  International War Against Radical Islam

The Market
    
    Technical/ Fundamental

    A study of the ‘January effect’ as it applies to small cap stocks:
    http://www.thestreet.com/p/_htmlrmd/rmoney/investing/10450911.html

    Stock market performance during recession (a graphic history):
    http://www.ritholtz.com/blog/2008/12/stock-market-performance-during-recessions/

    A not very positive outlook from Bill Gross (PIMCO)--his forecast implies high quality companies that dominate their industry and have sound balance sheets will be the winners:
    http://www.pimco.com/LeftNav/Featured+Market+Commentary/IO/2008/IO+Dow+5000+Gross+Dec+08.htm


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    Stocks staged a solid rally yesterday with the indices (DJIA 8429, S&P 849) closing above both their 10/10 lows and the downtrend line off their November high.  There was virtually no follow through from Monday’s huge decline; so it would seem stocks have passed their first test of the 10/10-11/19 lows.  The volatility index declined though it remains at stratospheric levels (62); and volume didn’t improve much (a negative).
       
    A great article on the positives of dividend investing:
    http://www.thestreet.com/story/10450941/1/why-dividends-beat-pe-ratios.html?puc=_htmlatb

     As I noted yesterday, I want to be really careful playing stocks first test of the 10/10-11/19 lows (assuming that they represent some sort of bottoming process).  The Monday/Tuesday pin action appeared to have been that first test; as a result, our Portfolios nibbled at stocks yesterday.  However, it looks like the Market is going to open down this morning; so before continuing to put money to work, I want to be sure yesterday’s bounce was for real.  Below are the stocks to be Added to; but let’s see how stocks trade in the first hour before committing additional cash.  At the moment, no action is being taken.





Posted 12-03-2008 8:32 AM by Steve Cook