Behind the Headlines

High Income, Fast Growth and Green Energy

by Dr. Stephen Leeb
Friday, May 9, 2014

We recommend an exciting and brand-new type of energy play, one that offers investors not just the promise of long-term double-digit growth but high and growing levels of income as well. And no, it has nothing to do with fracking (see below). Rather, it belongs to a whole new class of companies focused on renewable energies and dedicated to providing investors with sharply growing dividends.

These companies—dubbed “yield cos”—resemble Master Limited Partnerships (MLPs) in that they entail a limited partner that distributes or sells assets to the company and a mandate to pay out the... Read more about High Income, Fast Growth and Green Energy

U.S. Economy to Be Left Behind by China's Ultra-High Voltage Shake-Up

by Stephen Leeb
Wednesday, May 7, 2014

The world will shortly reach an important milestone, if it hasn’t been already, according to the World Bank. Measured on purchasing power, the organization estimates that China will be the world’s largest economy sometime this year. It eclipses the United States. We held that title for more than 130 years. No one should be surprised. For more than 1,500 years, through the late 18th century, the Middle Kingdom was by most counts the largest economy in the world.

More interesting than the story were the reactions to it. In China, the response was that the numbers are flawed, and are... Read more about U.S. Economy to Be Left Behind by China's Ultra-High Voltage Shake-Up

A Global Leader in Essential Fast Growing Markets

by Dr. Stephen Leeb
Monday, April 28, 2014

A few months ago we discussed a stock we had our eye on, but didn't recommend as a buy. The stock was Ecolab (ECL), a global leader in some of the world’s fastest-growing industries including sanitation, water treatment, and the efficient use of chemicals in unconventional energy. We promised that if this richly valued stock became more reasonably priced, we would recommend buying it.

Now we’re getting our chance. In the two earnings reports since then, profits were above expectations, leaving both the nominal and relative multiple lower. Those stronger profits in... Read more about A Global Leader in Essential Fast Growing Markets

Flash Boys vs. Buffett

Dr. Stephen Leeb
Wednesday, April 23, 2014

Plaudits to Michael Lewis. His latest book, Flash Boys, reveals yet again, a new and further disheartening way that Wall Street does not play square. In this case, the system does not put only the little guy at a disadvantage. As Lewis points out, some of the biggest hedge funds and mutual funds are elbowed aside by a new breed of high-frequency traders who profit from their ability to make huge volumes of trades nano seconds ahead of everyone else.

Individual investors seeking financial security for themselves and their families might well wonder whether investing in... Read more about Flash Boys vs. Buffett

Iraq's Oil Production Soars

by Dr. Stephen Leeb
Friday, April 18, 2014

Recently, we discussed the East-West confrontation over Ukraine vis-à-vis increasingly close ties between Russia, Germany and China. Today we consider another important story that also fell under the radar and that provides another window on Russia’s emerging global role: a sharp recent jump in Iraqi oil production.

In March, various international energy agencies reported that Iraqi oil production reached 35-year highs. Incremental production derives from development Rumaila and West Qurna, Iraq’s two largest oilfields, the latter controlled by Russian oil giant Lukoil. Their other... Read more about Iraq's Oil Production Soars

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Expect Growth But Protect Against This

by Dr. Stephen Leeb
Friday, May 16, 2014

What the world needs now is growth—the more the better. Political tensions often have their roots in poor economic performance. While weak growth does not solely account for the major crisis in Ukraine, its poor economic conditions certainly don’t help. That is also true in the Middle East, where a dose of strong economic growth might do wonders for volatile countries like Egypt.

Fortunately, we think the world’s largest economies clearly recognize the importance of growth. European growth would, of course, not only be a positive for the Ukraine but for other continental countries... Read more about Expect Growth But Protect Against This

These Metrics Put Us on Guard

by Gregory Dorsey
Wednesday, May 14, 2014

The U.S. economy continues to display signs of improvement following a marked slowdown in the first quarter primarily due to adverse weather conditions. We’ll watch several more markers this week for indications that it continues to gather strength.

We’ll watch the industrial production figures due out Thursday. Industrial output is expected to be flat in April following the robust 0.7 percent gain in March, while manufacturing output is anticipated to climb 0.3 percent following a 0.5 percent increase in the previous month.

Inflation data will also be closely scrutinized with April producer prices set to be released today followed by consumer prices on Thursday. Here the consensus expects a 2 percent year-over-year increase in the CPI. That would mark the third consecutive month of accelerating price increases, taking us further away from the deflationary threat. Core inflation (excluding food and energy) is believed to have held steady at 1.7 percent. Read more about These Metrics Put Us on Guard

Better Jobs Report Spells Better Economic Growth

by Genia Turanova
Monday, May 12, 2014

The U.S. employment situation is picking up, according to data issued earlier this month by the Bureau of Labor Statistics. Employers hired 288,000 new workers in April, the largest gain since February 2012, after a revised—and healthy—203,000 gain in March. Similarly, an index of industries hiring rose to 67, its highest level since February 2012. Hiring picked up at manufacturers, builders and service companies, given an increase in the consumer spending that fires roughly 70 percent of the U.S. economy.

On the downside, the workforce participation level fell to its smallest level in 35 years, a factor highlighted by the April shrinkage in the number of people entering the workforce to 5.84 million, the smallest number since November 2008. That represented a 14 percent decline from the 6.8 million who entered the workforce in March, and was the largest drop seen in workforce entries since 1995. Read more about Better Jobs Report Spells Better Economic Growth

High Income, Fast Growth and Green Energy

by Dr. Stephen Leeb
Friday, May 9, 2014

We recommend an exciting and brand-new type of energy play, one that offers investors not just the promise of long-term double-digit growth but high and growing levels of income as well. And no, it has nothing to do with fracking (see below). Rather, it belongs to a whole new class of companies focused on renewable energies and dedicated to providing investors with sharply growing dividends.

These companies—dubbed “yield cos”—resemble Master Limited Partnerships (MLPs) in that they entail a limited partner that distributes or sells assets to the company and a mandate to pay out the... Read more about High Income, Fast Growth and Green Energy

U.S. Economy to Be Left Behind by China's Ultra-High Voltage Shake-Up

by Stephen Leeb
Wednesday, May 7, 2014

The world will shortly reach an important milestone, if it hasn’t been already, according to the World Bank. Measured on purchasing power, the organization estimates that China will be the world’s largest economy sometime this year. It eclipses the United States. We held that title for more than 130 years. No one should be surprised. For more than 1,500 years, through the late 18th century, the Middle Kingdom was by most counts the largest economy in the world.

More interesting than the story were the reactions to it. In China, the response was that the numbers are flawed, and are... Read more about U.S. Economy to Be Left Behind by China's Ultra-High Voltage Shake-Up

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