29. April 2009 by Dan Walkow, CFA, CMT.

Phoenix has achieved the unwelcome distinction of becoming the first major American city where home prices have fallen in half since the market peaked in the middle of the decade, according to data released Tuesday and as reported by the New York Times.

Bargins abound for Canadian buyers with deep pockets but be mindful of your currency exposure and your US tax exposure if you purchase to rent.

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29. April 2009 by Dan Walkow, CFA, CMT.

One of the “next big things”  we will see in the near future is 3D display capabilities for your computer. No doubt you will need increased horsepower to effectively use this technology like the chips produced by Nvidia. Check this demo out to get the idea.

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28. April 2009 by Dan Walkow, CFA, CMT.

According to a recent Wall Street Journal article US citizens who saw fit to stash money offshore are reluctant to come clean with the IRS. Especially those with large losses.

Last month the IRS introduced limits on tax penalties hoping to coax offshore investors to come clean.

The IRS penalty limits apply to voluntary disclosure cases already under way, and to people who step forward within the next several months. Account holders must pay back taxes and interest for six years, and an additional penalty on all six years. In addition, they owe a penalty of 20% of the amount in the account in the year when it was worth most during the past six years.

One wonders what the penalities are for those that choose not to disclose but are caught!

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27. April 2009 by Dan Walkow, CFA, CMT.

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26. April 2009 by Dan Walkow, CFA, CMT.

China central bank governor Zhou Xiauchuan’s remarks made  in March for the eventual replacement of the U.S. dollar as the world’s main currency with special drawing rights (SDR), the quasi-currency issued by the International Monetary fund is becoming a hot topic amongst world central bankers.

Chinese central bank reserves are about 60% US dollars and 31% Euros. If the Chinese realligned their currency reserves along SDR lines then the USD dollar allocation falls to 44% and the Euro goes up to 34%. The Canadian dollar is such as small player  in world currency markets that the allotment to CAD dollars is relatively small. However I am of the opinon the allocation would go up and not down. How much who knows but it would not be unrealistic to see CAD/USD over par and perhaps more.

Europeans are not keen to have the Euro increase in value as it makes for a higher cost economic area. If the Chinese reduce their USD holdings by a third and increase the holdings of Euros any competitive advantage Europe has is eroded.

Our bullish stance on gold, precious metals and investments that benefit from a decline in the USD continue. For those investors who believe that the long term direction of the Chinese currency is up there is a new exchange-traded fund that allows investors to invest accordingly. Investing in yuan may not be suitable for all investors and you want to give us a call to discuss whether such an investment is appropriate for you.  Recently the Chinese have been consummating trade deals for settlement in yuan rather than insisting that trade settlements are done in USD or EUROS. This can only be bullish for the yuan.

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24. April 2009 by Dan Walkow, CFA, CMT.

Great chart on investor sentiment here. Classic!

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24. April 2009 by Dan Walkow, CFA, CMT.

Brian Acker is a well known Canadian money manager who is frequently featured on Canada’s business news channel BNN. He is very polished and spins a good story. Too bad he does not have the performance to back it  up. Be very careful on basing investment decisons on talking heads. Here is what Technical Analyst, Bill Carrigan has to say about Acker.

” I am sure followers of this blog also follow Don Vialoux’s daily TechTalk which is a brisk and refreshing daily commentary on the capital markets.

In his Wednesday morning publication Don quoted a recent study by Standard & Poor’s entitled “Indices beat most managers.” Apparently over the last five years 70% of U.S. large-cap fund managers who use the S&P 500 as a benchmark for comparison have failed to match the performance of the index over that time.

Don’s observation comes a day after BNN regular “black box” analyst Brian Acker glossed over the negative 1, 2, 3, 4 and 5-year returns of the Finley Select US Value 50 fund by insulting his TV audience on live television. The big irritant for Acker was a caller who pointed out the terrible 1-year return (at March 31, 2009) of a negative 53.88%, double the loss of the S&P500 benchmark or peer at a negative 24.10%.

When under pressure from BNN’s Michael Hainsworth to explain the severe underperform and the negative losses from inception Acker effectively blew up in front of a live television audience stating technical analysis to be “useless” and then describing the traders “out there in TV land” to be “hamsters.” Another caller was ridiculed for suggesting a selling strategy.

Wow, I and others just got called “useless rodents” on national television!

I forgive Acker because he was afflicted by a street term known as “Ackers Folly.”

Acker’s folly is the tendency of investors to sell winners quickly (because they are expensive) and to hold losers (because they are cheap).

This affliction can be cleared up with a few visits with a qualified technical analyst.

If Acker had used even the simplest stop loss strategy he could have saved his enterprise from this disaster

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24. April 2009 by Dan Walkow, CFA, CMT.

“With remarkable frankness, Mr. Carney singled out the U.S. government for criticism in his quarterly economic report Thursday, placing much of the blame for Canada’s economic woes on U.S. Treasury Secretary Timothy Geithner’s abortive attempts to cleanse financial institutions of their toxic assets.”

Carney is not pulling any punches in his commemts read them here.

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22. April 2009 by Dan Walkow, CFA, CMT.

Given that auto sales in China have surpassed the United States for three months running now it is notable that GM is better positoned in China than Ford and others. Only VW sells more autos in China than GM. Read more here.

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22. April 2009 by Dan Walkow, CFA, CMT.

So the question is do you think the air we breath is more or less polluted than it was in 1980? Consider that since the first Earth Day in 1970, U.S. population has increased by 50.25%, miles driven has increased by 159% and real GDP has increased 203%. Check it out here the answer may suprise you!

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