Perfecting Perfection, Almost
By Andy Carpenter 
Nothing in life is perfect. In fact, to write such a sentence means most of my life must be pretty darned all right. After a too long and too snowy winter, I am, today sitting on the back porch with laptop in lap. Yeah, the WIFI signal just barely makes it out to here… the G5 in my office is hardwired to the Internet so it’s blazingly faster. But, I am enveloped by the sudden warmth that has temporarily descended upon Boston… teasing us with implications of what’s too come. Of course, it has been warm and dry, so I am crushed under the weight of pollen, which makes me ache, and sneeze, and itch and occasionally gasp for breath. The garish-yellow forsythia are gloriously in bloom, but they draw my eye to vast sections of the yard that didn’t get raked last fall because the snow came too early. Those damned oak trees in the west that help keep the house so cool in the summer also dump millions of leaves all fall. But, man is it nice to be semi outside. It’s even possible, on occasion, above the din created by the 10 or so lawn crews working in the neighborhood at this moment, to hear a woodpecker hunting food… a robin and finch chatting with their peers. So, nothing is ever exactly right… well, in the big picture that is. Because, moments can be perfect as long as you’re ready to appreciate them. The Perfect Investment Moment That search for the perfect moment is of course a dangerous thing for investors. There is never a prefect moment to place your hope and money on a stock, bond, business or real estate investment. Even if you’ve done your homework in regards to the risk you’ll take, you can easily find a negative voice – a gloomy outlook – at just about every turn. In fact, those are the voices that seem to be shouting the loudest. This is especially true with stock investing. In fact, the loudest voices during the past three or four years seem to be the ones within the financial media that are trying to convince you that buy and hold – the strategy in which you buy solid companies and pretty much forget about them – is a stupid way to invest today. Now, I will agree that if your tolerance for risk is high and you play penny stocks or other risky speculations that you should constantly have your hand on the pulse of those trades. That’s the price you pay for accepting a high-risk potentially high-reward position. But anyone who espouses that buy and hold is dead is peddling you bunk. And, it’s repackaged bunk at that. For these death-to-buy-and-holders were likely the very same characters who, during the past 20 years, have tried to sell you Internet, tech, gold and the change from pension funds to 401ks as radical new investment paradigms… that holds for China, too, my area of expertise. Investment Attention Deficit Disorder You see, it’s imperative for the investment crowd that flits from fad to fad to sell you on the critical notion that buy and hold is dead… how the hell else can they convince you to follow their flights of fancy. I see a lot of this new paradigm crap surrounding China investing. I once, for about seven months, was even involved with a newsletter that peddled such bunk. It was not a happy partnership. The divorce cost me a small fortune in money left behind. Of course, the reality today is that China has graduated from an investment trend to an investment reality. And, that’s not a new paradigm. If anything, it’s an extremely old paradigm. And it will take the usual amount of work to separate the good from the bad and downright criminal, just like it does with the 10,000 or so US-based stocks that trade every day. Come on now, do you really believe that all those OTCBB and Pink Sheet companies are run by patriotic Americans whose sense of fiduciary duty extends to taking your money and making it grow? If you do, have I got a Chinese granite mining stock for you, or a Chinese fertilizer outfit… or a (a thankfully formerly traded) public company that wanted you to finance its drive to sell chewable vitamins to Chinese children. Shift This You see, just as it is with European, German and Indian stock markets, the US stock market is home to every sort of scam, including those from China. That’s the way it is with investments that are sold as major paradigm shifts. Instead of frank talk about China, the majority of what the financial press and publishers feed you is useless pie-in-the-sky stuff (and yes I approved my newsletter’s marketing in case you think I am peddling it ala mode) or useless news such as what the Shanghai Stock Exchange is doing. The media peddlers are only in two moods… bubble up or bubble down. That makes the deal with China exactly the same as the deal with Silicon Valley or Austin, Texas. It’s a simple proposition. Do you easily understand what it is that a Chinese company does? Is it more than a story… or does it at least admit it is just a story, now? Are its financial reports up to date and audited with generally accepted accounting practices? Does its management seem stable and adept? Do you understand the risk? Would you buy and hold this stock? See, China may be an emerging market that allows you access to tons of new public companies, but it is not exotic. But, churning and burning your portfolio is. So, let’s put this silly, death-to-buy-and-hold mindset behind us now. Anyone who’s peddling you that hokum merely wants access to your wallet… nothing more. Now, let’s move on to more of your opinion pieces. The one from Jennifer suggests that my pool could be a cash cow. Actually, my glibness aside, she makes a heck of a point…as does Larry in the second piece. Wish we could get him the chance to buttonhole Condoleezza Rice. See you next Saturday. Have a great weekend. Lock and load. Andy P.S. To let me know what you thought of today's article, send an e-mail to: feedback@investorsdailyedge.com.
INTERNAL ENDORSEMENT Just this Once BELIEVE THE HYPE! It was the email that shocked the investment world. One noted investment authority told his readers to take seven huge stock market gains on one day… SEVEN HUGE WINNERS on one day that ranged from 526% to 102%... seven, and on stocks… not options. But that was just the beginning! It now looks to be setting up to happen again this year, too. That’s why you must check out the whole story right here.
A Real Biofuel Alternative Andy, You're half-right about the Ethanol scam. True, ethanol produces less energy gallon-per-gallon than gasoline, requiring more gallons of fuel to propel a car the same distance, so all the lower-cost-gas estimates are comparing two disparate things. But it is still a viable fuel... when it's created from the appropriate source. Corn is just about the worst source imaginable. There are many other plants – non-edible ones, even, that won't deplete the world's food resources – that produce two, five, or even ten times as much fuel per acre of planting. The hands down winner, however, is algae, which can produce 10,000 gallons of oil per acre of land, and which uses waste carbon dioxide from industrial smoke stacks as a nutrient, helping to reduce greenhouse gas emissions in the process. Conspiracy theorists have opined that the ethanol-from-corn scam is a joint product of the agribusiness and big oil companies, to make a quick buck while discrediting ethanol as a potential fuel source. Jennifer Dunne Hey Mahmoud, What Is That In The Sky, A Care Package? First, I always enjoy your articles, but I'm in the silent majority, so I don't comment. Secondly, I ask myself these questions: 1. George Bush and his cohorts keep talking about "Victory in Iraq." My understanding is victory is when you win something. What will we win in Iraq? 2. How do you stop the war? Contact every Arab company in the Middle East and ask them if they are happy we are in Iraq? If they answer, "No" as I surmise (except Israel), then tell them to put a peace-time army in Iraq and we will move our troops to Afghanistan and Pakistan and find and disseminate Osama Bin Laden. 3. If Iran wants an atomic bomb so badly, send them one on a parachute that will detonate about 500 feet above Mr. Ahmadinejad. Besides, what is an atomic bomb if you can't deliver it? The US has the only ability to bomb any part of the world. What does this have to do with finance? If we are out of Iraq (how badly did Vietnam tarnish our reputation?) and start paying off the debt to Japan and China, the whole attitude in the US will be positive and we can start being a creative, hardworking country without Bush’s crap. Over six years ago, shortly after 9/11, I was driving in the desert in Arizona. In front of me was an old beat-up truck. Its bumper sticker proclaimed: "Iraq, Arabic for Viet Nam." Even this hillbilly new George Bush was a stupid idiot. This is his recession and we need to get rid of him, his cohorts and their decisions before it becomes our depression. Larry Dunning
Subscribers to Andy Carpenter’s Asia Business & Investing newsletter banked stock gains (not options) of 562%, 300%, 383% 197% 149% 123% and 102% on July 7, 2007. They are currently sitting on these staggering gains… as of April 11, 649%, 319%, 179%, 77%, 196% 100%, 126%, 185% and 430%. That’s just a harbinger of the future. Find out more here.
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