It's A Puzzle???

The TSX closed out February at 14,136.  Here we are thirty days later and it's not quite back to that level.  The close today was 14,083.  What puzzles me is the fact that my stuff hit a new multi-year high today.  It's a beautiful world!  Guess I'm holding the good stuff at the moment. I won't brag too much because we all know how quickly the markets can turn.

One thing I know for sure is that I'm loving my Canadian banks.  My longest hold is TD.  I bought TD in February 2008 at $69.50.  They closed today at $86.40.  Plus, I've received some great dividends along the way.  Sweet!  My much more recent acquisitions of BMO and RBC are doing remarkably well in the short time I held them. When tempted to sell and take the profit I must remember what that guy said on BNN a while ago.  "Canadian banks have outperformed the markets every year since 1967".  Ya, I gotta remember that.

Tomorrow we close out the month of March and the the first quarter of 2011.  I'm not saying a thing that could be construed as a prediction.  Seems every time I do that the market swings in the opposite direction as though to prove once again that I'm not the sharpest knife in the drawer.

Good Luck and Happy Investing!

It's been a good week when...

Your stuff is worth more after the closing bell on Friday than it was the Friday before.  On that basis, this was a good week.  As the week bumped along it wasn't very exciting but in the end my stuff was up about 1%.  I'll take it.

The big news today was Apple's (AAPL) launch of iPad2 at 5:00 PM 'Peg time.  The local news showed the crowds at the Apple store.  Some had been there since 6:00 AM.  No other company hypes a product, in advance of the launch, like Apple.  The big story next week will be all about how many million units they sold this weekend.

As a proud Canadian I have to feel sorry for Research in Motion (RIM).  RIM introduced their first touch screen smart phone sixteen months after Apple came out with the iPhone.  Then, as though to lay permanent claim to this lag time, they revealed plans to bring out the PlayBook sixteen months after Apple launched the iPad.  Then they said the PlayBook wouldn't be out for another four or five months.  Jeez!  In the meantime Apple brings out iPad2 before RIM sells the first PlayBook which is now slated for launch on April 19.  I wonder how many millions of iPad2s Apple will have sold by then.

As I said a couple of weeks ago, I love my new Blackberry Style but I don't see RIM catching up to Apple in either the consumer smart phone field or the tablet computer market.  They're just too far behind.  As much as I missed some upside by bailing on my RIM shares last fall, I'm still way ahead with the trades I've made since then.  

A gold mine is a hole in the ground with a liar on top.

Mark Twain said that about 160 years ago.  That was a long time ago, before rules, regulations and security commissions were in place to protect investors.  Tell that to Bre-X investors. Back in 1997 Bre-X, a Canadian company, claimed to have a 200 Million once gold resource in Borneo.  Fortunes were made on the way up and wiped out when it was discovered that gold had been blasted onto the walls of the mine with a shotgun.  It was a big story in the late nineties.

I wasn't involved in Bre-X.  HudBay Minerals - My BIG Mistake tells the story of my first mining investment.  This wasn't a story involving fraud or deceit, rather it was about a very successful miner and an overheated commodities market.  When I bought into HudBay the company was debt free, had half a $Billion in the bank and was churning out free cash flow at the rate of a $Million a day.  When the bottom fell out of zinc prices I sold, took the lose and moved on.

Since HudBay I've enjoyed some success with mining stocks most of which I've written about on these pages.  A couple times it was all about timing.  I bought Fording Coal (FDG.UN) just days before a takeover offer from Teck Cominco, now Teck Resources (TCK-A).  I had similar dumb luck with my coal miners late last year.  I bought Western Coal (WTN) and Gande Cashe (GCE) just a few weeks before a takeover offer for Western dragged the whole sector up.  Of course, my biggest success with miners was Scorpio Mining which was my first ever and one and only double.

I've gotta fess up, they're not all winners.  Right now I'm holding a mining stock that's under water.  One day, while listening with one ear, the analyst du jour on BNN recommended Evolving Gold (EVG).  Without doing any research I logged onto my trading account and placed a buy order simply because I had a bit of money left after couple of recent trades.  What I later learned is that Evolving doesn't have a mine...just exploration sites in Wyoming and Nevada. I paid $1.28 that day and they've never there since.  I now have a rule, I don't buy a miner unless it actually has a mine.  I'm going to leave the junior exploration companies to the young guys who are prepared to take the chance that one in ten will actually turn into something.

Take off the Beer Goggles!

Apparently the only way to determine where the TSX is headed on any given day is to keep quiet and wait for market close at 3:00 PM 'Peg time.  Nothing else matters.  I was looking through my Beer Goggles yesterday morning when I suggested that the bleeding may have stopped.

No matter how positive the signs were in the first hour of the trading day nothing mattered when US housing numbers came out in the afternoon.  New housing starts...biggest drop in 27 years.  This news put the whole US recovery story in question.  If the US recovery falters, we don't stand a chance.

After the US housing news hit, the TSX turned south and managed an eighth straight day of decline.

As I write this, there is some overnight news which might tempt me to make a predictive suggestion about the day ahead.  I'm not saying a thing! 

The Bleeding Has Stopped...maybe???

After peaking on March 4 at 14,252 the TSX tumbled for seven consecutive days down to yesterday's close of 13,546.  A fall off just shy of 5%.

Maybe, just maybe the market has come to it's senses today.  Forty-five minutes into the trading day and the TSX is up 80 points.  Heres hopin'.

My stuff is doing okay today...except for the banks.  Seems the financials are down because Manulife has a very large presence in Asia.  Obviously Manulife will suffer considerable losses with all the deaths and injuries in Japan.  Not sure why that's dragging down the BIG 5 after just turning in record breaking Q1 results.

Us oil inventories just out.  Oil up a bit more than expected, big draw down in gasoline inventories.  Oil just jumped a couple of bucks and the TSX is now up 108 points. (9:35 AM 'Peg time)

Watch List
I'm still keeping an eye on Teck Resources (TCK-B).  I'd love to get some at the present level but have no liquidity in my trading account and nothing that I care to sell at the present levels.  I've been watching Dollarama (DOL) since the IPO.  Interesting story but I have trouble understanding the P/E ratio of 18.4 when the much more mature Shoppers Drug Mart has a P/E ratio of 14.5.  I'll watch it for another quarter or two.

Slip, Slidin' Away

We can never assume that the markets are going to stay on track. February marked the eighth consecutive month of gains for the TSX. We were basking in the long term gains since March of 2009 and joyfully celebrating the shorter term gains racked up since last September. March began like most months...a kick up for the first few days, peaking on the 4th. And then...

Along came political upheaval in the middle east, beginning in Egypt then rolling to country after country. Seems you can only oppress the people for so long. Apparently about 30 years is the breaking point. The end result may very be that several new democracies will rise in the middle east and the people may, at long last, enjoy a level of freedom and equality that we take for granted. Unfortunately, the path to democracy, freedom and equality will likely be long and painful. And then...

Along came the earthquake in Japan. 8.9 Upgraded today to 9.0 Yikes! Unbelievable devastation. Within hours the Japanese economy ground to a halt. All available resources were shifted to rescue those still living and treat the injured. If the quake and tsunami weren't enough, a couple of nuclear power plants were damaged and may very well be an even larger threat to the Japanese people and economy.

From March 1 to yesterday the Nikkei was off over 10%. Today, another 10% haircut. Here at home, the TSX peaked at 14,252 on March 4. Down to 13,546 today. Tomorrow's not looking great with US futures already in the tank.

Seems like a good time for a re-read of A Little More About The Last (Next) Ten Years. Like I've said before, I don't have a crystal ball but it doesn't take a genius to predict that this stuff will happen from time-to-time. With instant worldwide publication of all events, both good and bad, the markets react immediately.

I plan to take a whole bunch off the table with the next recovery...whenever that is.

Smarter Than Smart

I took a huge (for me) technological step forward last week with my purchase of a Blackberry Style 9670 Smartphone.  Spent most of the weekend playing with it and trying to figure out how to take advantage of its features.  At this point, all I can say is that it is unbelievable!

I don't even want to think about all it can do or how it does it.  It's just crazy smart!  Makes me kinda sorry that I took my profit on my RIM shares last fall, but, you do what you do with the info available on any given day.

I don't have a crystal ball...but

I've made a number or comments and predictions about Canadian bank shares over the past year or so.  Have a look here, here, here, here, here, here, and finally, the post just below of March 1 where I actually predicted that yesterday's RBC and TD Q1 earnings would blow the doors off expectations.

Well, didn't that just play out.  Yesterday RBC shares jumped $2.98 for a gain of 5.23% and TD gained $3.10 or 3.85%.  Dollar wise, yesterday was my largest single day gain in my trading account.  I'm reminded again what the guy said on BNN on February 16.  "Canadian banks have outperformed the markets every year since 1967."  Real tempting to just put it all in the banks and sit back watching them grow while cashing those nice dividend cheques.  Hey, I could write a new blog...The Lazy Canadian Investor.

Happy Friday and Happy Investing.  Have a great weekend!

Happy March!

Well, the day began like most 1st days of the month.  As I've said before, we Canadians seem to greet each new month with new enthusiasm and optimism.  Yup, the day began that way with the TSX touching a new 32 month high of 14,213 before falling off...after which it headed steadily down for the rest of the day.

The day started off with slightly better than expected earnings from BMO.  Largest Q1 profit ever!  Then came BOC with the interest rate announcement.  Ho, Ho, Holding the line at 1%.  No surprise there.  Old Guys have to wait a while longer.  No surprise there.

Other than that, I wasn't glued to the tube all day so I'm not certain what happened.  What I'm seeing now at the close of the day is oil jumpin' three bucks to $100.  Gold is up $25 to $1,435. Not sure why the TSX is down 13 points but I'll take it.  At these levels, any day it goes up or sideways is an okay day in my books.

Hey, the C$ is up to 1.0259 US.  Just for fun, take a C$100.00 bill into your bank and ask to buy $100 US. I'm bettin' you need another few cents.  Par in the markets isn't par at the retail banking level.  Ergo, BMO's record breaking quarter.

Royal and TD results on Thursday.  Again, because I wasn't paying attention today, I have no idea why TD shares are off nearly 2%.  I'm betting they're back on Friday as I'm betting Thursday's earings reports for both RBC and TD will blow the doors off expectations.