Young Research & Publishing Inc.

Investment Research Since 1978

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Gold Surges to Record High

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Gold is up more than 6.5% since the first of the month. The precious metal is rallying on fears that the euro-area financial crisis may infect Italy and an indication from Chairman Bernanke that the Federal Reserve hasn’t ruled out another round of money printing. I’m not sure who believed that the Fed took QE3 off the table, but based on the price action in financial markets today, apparently some investors did. Gold is up $18 today, silver is up more than 5%, wheat is up 6.4%, oil is rallying, the Dow is up over 100 points, and the dollar has fallen to a new low versus the Swiss franc. … [Read more...]

The Jobs Report

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After the blowout payroll employment number reported by ADP yesterday, investors were expecting a similarly strong showing from the government employment report today. They didn’t get it. Instead, those who bid up shares yesterday on hopes built upon a single monthly data point from a famously inaccurate source took it in the neck. This morning’s payroll employment report was dismal. Stocks plunged on the news—giving up all of yesterday’s gains and then some.  Officially, economists were looking for total nonfarm payrolls to expand by 105K. Unofficially, after yesterday’s ADP report, … [Read more...]

S&P 500 Technical Analysis Update

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Stocks are up big today on a blowout ADP employment report. Economists were looking for private sector job gains of 70,000 in June. The actual number came in at 157,000—more than double expectations. The strong ADP report comes on the back of better than expected manufacturing data last week. Two better than expected economic data points, and investors have thrown caution to the wind. In only 8 trading days, stocks have gained nearly 7%. From a technical analysis perspective, the S&P 500 looks strong. The index bounced powerfully off of its 200-day moving average and instead of running … [Read more...]

Your Worst Payday

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Should you have more invested in the stock market? The Dow has almost doubled from its March 2009 low. And over the last ten months, the index has gained 26%. Oil prices have started to pull back, the euro-area debt crisis is being addressed (at least temporarily) and some U.S. economic data has come in ahead of expectations. With the Dow surging 5% in only five trading days, you may be feeling more confident. Instead of hoarding cash, you might be looking to invest. But after the near doubling in the stock market, is it still a good time to invest? How can you tell?   In order to gauge the … [Read more...]

The World’s Most Profitable Currency

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Can you guess which of the world’s currencies has appreciated the most this year? If you guessed the Paraguayan guarani, you’re right. A close second was the kina. Which country uses the kina? Why, Papua New Guinea, of course! If you would have trouble spotting either of these countries on a map, you aren’t alone. Like most sane investors, you probably limit your currency investing to developed countries and some of the larger emerging markets. Which major currency has performed the best this year? The Swiss franc. Just this year, the franc has gained 11.5% on the dollar. That crushes the … [Read more...]

What we’re Reading 6-17-11

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Why 70% Tax Rates Won't Work The WSJ More U.S. homes lease solar panels with no upfront costs USA Today Jiffy Lube changes 3,000-mile rule for oil changes USA Today Uncertainty Is Not the Problem The WSJ The Return of the Population Bomb The WSJ Apple Retreats in Publisher Fight The WSJ A Constitution Scholar for the Fed The WSJ … [Read more...]

Are You Exposed to the Most Leveraged Bank in the U.S.?

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Sorry to break the news to you, but you are exposed to the most leveraged bank in the U.S. All Americans are. Why? The most leveraged bank in the U.S. is the Federal Reserve. Yup, the Federal Reserve—the same bank that issues those green pieces of paper in your wallet. How levered is the Fed? It holds only $1 in capital for every $53 in assets. Before Lehman Brothers went bust, the firm held $1 in capital for every $30 in assets. How does that sit with you? Don’t forget those green pieces of paper are liabilities of the Federal Reserve—similar to a bank deposit. Pull one out of your pocket. It … [Read more...]

S&P 500 Technical Analysis Update

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The S&P 500 is approaching a critical technical level. There is support for stocks around 1,255 on the S&P 500. The 1,255 level is also the 200-day moving average and the neckline of what appears to be the formation of a head-and-shoulders top. A decided break below 1,255 could signal further losses. If stocks catch a bid at 1,255 on the S&P, technical analysts will tell you that a rally back toward 1,340 is the most likely outcome. Stay tuned. … [Read more...]

Cut Your Portfolio Risk by 70% Today

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Do you still have too much invested in stocks? At Young Research, we’ve long favored a balanced strategy. Why do we favor a balanced approach? The simple fact is that an all-stock portfolio has more volatility than most investors are comfortable with. This is especially true for conservative investors and those investors in or nearing retirement. If you are on the verge of retirement, can you afford to sustain a 50% loss in your portfolio? Stocks fell 50% twice in the last decade alone, and it could happen again. With a balanced portfolio, you minimize the risk of portfolio-decimating … [Read more...]