June 01, 2006
Trend Updates for 2006 - calling it like I see it.
It's been an interesting first five months of 2006. It's a great time to review the good and bad and housekeep on some market trends.
Here is my focus right now:
I don't short stocks, so I am focused on commodities, GPS companies, Interest Rates and private entrepreneurial endeavors. Inflation is rampant - trust me, I pay the bills in my house. When Ellen and I downsized our home last year and rolled the money into other investments, I believed that our costs of living would drop tremendously. They have not. Overall, I remain very cautious based on this personal cost of living index which I keep in my head and in quicken.
On the private side, I am sticking to asset backed lending, internet services - not eyeball businesses, educational enhancement tools, GPS investments, and service businesses in the southwest. I have a hedge fund business (Access Capital) in Toronto and my partner and I will be focused on that over the summer as well. My family intends to spend most of the summer in my beautiful hometown city.
I have made two private investments in the first half of 2006 - one in the identity theft arena and one in education. I am adding to my GolfNow investment during the summer.
Ellen and I do not intent to commit any more money to our home, but have been buying art for some reason. That has been the funnest part of the year.
Writing and networking. It has been a great learning and growth experience in 2006 and have met more great people in the last 6 months that the last 6 years. That is a trend that I will continue to hammer away at.
Here are some broken trends:
Housing is broken if you look at the stock prices. The data at this point is noise unless you are trying to call a bottom. I am seeing more for sale signs in Phoenix than I have seen in a year.
Sattelite Radio - only Howard Stern, Oprah and Dr. Phil will come out smelling like roses in this brewing fiasco. Doctor Phil will smell again immediately after he fiasco unfolds. He will put on 250 pounds and blow up, but I digress!
Emerging markets - despite the nasty selloff, I remain long these markets but am close to the stop zone.
Apple - Company is executing, stock price says otherwise. The long-term price trend is broken and bad things often happen to stocks from the position it sits. I am hoping for extreme weakness for a good entry point. I own it, but not in size.
Adobe - Video on the web is growing, yet market titan Adobe is hurting. Either a great long-term entry point in Adobe or an industry shift is underway. I own it, but not in size.
Mobile Phone markets - the market is still growing but no clear winner.
FEAR - seems like it could go either way from here.
Inflation - food, fuel, healthcare, entertainment.
Weak US Dollar.
LAME IPO's - Vonage and CROX
Commodities - HOT, but cooling fast. Trends remain strong.
GPS stocks - The tech leaders. I am following GRMN, TOMO, LOJN, SIRF, TRMB and NVT.
Drug stocks remain hated.
Interest rates are rising on a global basis, but they remain low on a historical basis.
Corruption - never been hotter. Weak Board of Directors and Weak leadership.
Conflicts of Interest - Media and Big Banks - all time highs!
Internet usage and information technology - specifically new media like blogging. Video is on fire.
Shipping - shrinking world thesis still strong. It is not just blogging.
Identity Theft - rampant threat.
Deterioration of our educational programs K-12. A whopping 50 percent of our teachers are set to RETIRE in the next 5 years.
EVIL behavior and TEMPERS and ANXIETY