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Is Warren Buffett Right…..Is Active Money Management Worthless?

warren-buffett-investwithalexThus far, Warren Buffett is beating the pants off his rival in now infamous 10 year performance wager. Warren Buffett adds to his lead in $1 million hedge-fund bet

The wager is simple. According to Mr. Buffett, the S&P Index will beat a hand selected portfolio of hedge fund and fund of fund managers. The creme de la creme if you will. And the results thus far?

The S&P is up 63% Vs. Hedge Funds +20%.

This brings out an important question. Is active money management even worth your time? 

My opinion remains the same. If you NOT an active investor, pick the least expensive index ETF and keep putting money into it month after month.  Long-term, you will come out way ahead of 99.5% of money managers out there.

Otherwise, active money management does make sense. There are thousands of different ways to consistently outperform the market. Sometimes by a large margin. For as long as active investors dedicate their time and continue to improve their skill set, it is the only logical outcome. Someone will outperform this market and get rich, it might as well be you.

At the end of the day Warren Buffett himself is a perfect illustration on that.

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Is Warren Buffett Right…..Is Active Money Management Worthless?   Google

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Have They Completely Lost Their Minds?

einstein quote

Yes, I am talking about the US Government. U.S. taking new look at giving arms to Ukraine forces: NYT  We have covered the conflict in Ukraine in great detail since it first started. Fairly accurately I might add. One of the things I have maintained since 2013 is that Russia will never let Ukraine go or fall into Western/NATO’s hands. In fact, I have maintained the following view.

Russia WILL go to war against NATO or anyone else in order to prevent Ukraine from falling into Western hands. If you understand that region and Putin’s mindset, its a forgone conclusion.

An undeniable truth that even the lowest level CIA operative should be able to understand. They either don’t or Washington wants/needs this clear path to war with Russia. Make no mistake, supplying Ukraine with arms will get us there is a hurry. Stupidity at its best. Unless that is exactly what they want.

Who is right or wrong is outside the scope of this discussion. It doesn’t really matter. What matters is, if the US supplies Ukraine with weapons, we will be on the verge of a massive war in the region. With a real possibility of NATO being dragged into a direct confrontation with nuclear Russia. I wonder what that will do to the stock market.

In the meantime, no one has been able to provide me with a legitimate answer to the following question………………. What is the US and NATO doing in Ukraine? 

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Have They Completely Lost Their Minds?  Google

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What You Ought To Know About January’s Sell-Off

Daily Chart Feb 2nd

2/2/2015 – An up day with the Dow Jones up 196 points (+1.14%) and the Nasdaq up 41 points (+0.89%). 

After our December 26th top call, the stock market continues to perform just as forecated. If you would like to find out what happens next, a bounce or a big sell-off, please Click Here. 

It is a well known Wall Street adage, “As goes the January so goes the rest of the year”. And while it didn’t work last year, 2015 might just do the trick. After all, it was a significant down month and the volatility is certainly back. Consider the following…..

So, should you be concerned? I believe so. Despite January’s tribulations and bad “omens”, the majority of investors out there remain overwhelmingly bullish. Despite recent evidence to the contrary they continue to believe that we are in a long-term secular bull market and that every dip should be bought.

As I have suggested here so many times before, nothing could be further from the truth. First, a secular bear market that started in 2000 will not complete until 2017. And at a much lower print. Second, the weaknesses we are seeing on multiple levels should not be dismissed as a “buying opportunity”. Finally, the volatility is back. And as I have said so many times before, it will drive both bulls and bears up the wall. January is a good example of what to expect over the next 2-3 years.

This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2014/15-2017. In fact, when it starts it will very quickly retrace most of the gains accrued over the last few years.  If you would be interested in learning when the bear market of 2014/15-2017 will start (to the day) and its internal composition, please CLICK HERE.

(***Please Note: A bear market might have started already, I am simply not disclosing this information. Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. February 2nd, 2015  InvestWithAlex.com

Did you enjoy this article? If so, please share our blog with your friends as we try to get traction. Gratitude!!!

What You Ought To Know About January’s Sell-Off Google

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Why Apple’s Earnings Report Was Super Bearish – Daily Stock Analysis

aapl

First, the good news. Amazing quarterly earnings and future growth prospects, the stock is not excessively overpriced (when compared to some other high flyers), Carl Icahn thinks its a no-brainer $200 stock and Apple bulls are laughing at the shorts…. Apple doubters need a do over

And the bad news? Despite all of the above, Apple’s stock price is where it was 2 months ago. Thus far. Unable to break above $120 and suggesting that it might soon close its earnings gap and continue lower. Possibly low enough to re-test $75.

Why is this so significant?

Well, if Apple is breaks down after its blockbuster earnings report, it simply spells doom for the overall market. If strength can go higher, the probability of us already being in a bear market surges exponentially. That’s why.

If you would like to find out if we are shorting AAPL right now, please Click Here.  

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Why Apple’s Earnings Report Was Super Bearish – Daily Stock Analysis Google

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Faber: Buy Gold And Short Biotech, Social Media

A very good interview with Marc Faber. Definitely worth 5 minutes of your time. Why? Well, Marc believes the FED is starting to lose control, the US economy is rolling over and the stock market is massively overpriced. Particularly sectors such as Biotech and Social Media. He suggests shorting them through ETF’s. And the good news? Gold is about to surge as it becomes the ultimate hedge against today’s currency wars. I mostly agree.

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Faber: Buy Gold And Short Biotech, Social Media Google

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Two Hedge Fund Managers Discuss The Stock Market, Currencies, Commodities & Investment Ideas – Weekly Podcast

January 31st,2015: We have a great show for you this week. Hedge fund managers Matthew Demeter and Alex Dvorkin discuss the following topics….

  • The stock market and what we expect to happen over the next few months.
  • COT Report and what the big guys are buying. Listen to make sure you are not on the wrong side of the trade.
  • Swiss Frank, Gold, Oil, 30-Year Bond, Copper and what we expect to happen in these markets.
  • A multitude of great investment ideas that can make you a ton of money.
  • And of course, much…..much more.

Don’t miss this one and join us again next Saturday. 

Listen to the podcast by clicking on the player above. If you prefer iTunes, please Click Here

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Two Hedge Fund Managers Discuss The Stock Market, Currencies, Commodities & Investment Ideas Google

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How I Predicted December 26th Top And How This Oil Crash Will Impact The Stock Market

Daily Chart January 30th

1/30/2015 – A big down day with the Dow Jones down 248 points (-1.42) and the Nasdaq down 48 points (1.03%). 

The market continues to perform as anticipated. As the market turned around and surged higher on December 16th, 2014, my subscribers knew exactly what that meant. My mathematical and timing work at the time projected the next tuning point on December 27th at 18,100 (+/- 50 points). The Dow topped out on December 26th at 18,103. Not bad if you ask me.

Since then, the Dow is down -5.2% So, are we about to bounce or is this sell-off just getting started? Click Here to find out.

Now, lets get to oil and what the collapse means for the overall stock market. One of the best technical/fundamental looks at the subject matter that I have seen can be found here Is Oil’s Big Capitulation Sell-Off Still Ahead?  I couldn’t agree more and, once again, that’s the reason why you shouldn’t try to catch a falling knife. Plus, oil might stay at today’s levels for quite some time.

oil5

With that in mind, my primary concern is as follows. This oil price collapse hasn’t yet been felt throughout corporate America and corporate earnings. We will only start seeing that in Q1 of 2015. And by default, in the overall stock market indices. Meaning, a huge number of companies will have to write stuff off or guide lower.

Yes, there will certainly be a positive impact from lower oil prices. Such as higher consumer discretionary spending power and cost savings for a few select companies. Yet, I don’t believe it will be as significant as most financial analyst believe. And as I have suggested a few days ago, the Dow Transportation index is not reacting to any such cost savings Shiller Thinks You Are Scared & What Does The Dow Transports Index Tell Us.

That is to say, I believe the negatives will outweigh the positives by a large margin. Shale development/production is no longer economical. Thousands of companies will default and go out of business. Tens of thousands will lose their high paying jobs. Banks will be impacted. Earnings will be impacted. Junk debt market will blow up. Market caps will be cut in half. And so on and so forth. Will this lead to Trillions in losses in both market and real capital? No one knows just yet. In either case, expect this oil crash to spread through the rest of the economy and capital markets in 2015.

This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2014/15-2017. In fact, when it starts it will very quickly retrace most of the gains accrued over the last few years.  If you would be interested in learning when the bear market of 2014/15-2017 will start (to the day) and its internal composition, please CLICK HERE.

(***Please Note: A bear market might have started already, I am simply not disclosing this information. Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. January 30th, 2015  InvestWithAlex.com

Did you enjoy this article? If so, please share our blog with your friends as we try to get traction. Gratitude!!!

How I Predicted December 26th Top And How This Oil Crash Will Impact The Stock Market Google

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Shocking: China’s Collapse Is Accelerating

China Bank Assets InvestWithAlexWe have been talking about China’s “ponzi” economy for well over a year now. Here is just a small sample of our previous work China’s Housing Collapse Is Already In Full Swing. It now appears that China’s massive fraud is beginning to unravels. Consider the news flow.

Here are just a few more bits that should scare the bejeezus out of you.

  • Chinese corporate borrowers owed $14.2 trillion at the end of 2013 Vs $13.1 trillion owed by U.S. corporations.
  • This means that as much as 10 percent of global corporate debt is exposed to the risk of a contraction in China’s informal banking sector.
  • Cash flows and leverage at Chinese corporations are the worst among global peers, having deteriorated from being the best in 2009.

As I have mentioned in the past, most of China’s economic growth over the last 5-6 years has been financed by massive credit expansion. The likes of which we have never seen before. The result? 

  • $21 Trillion Debt Mountain. Roughly the same size as the entire US Banking Sector. It took the US 220 years to get to that number, it took China just 5 years of explosive credit growth.
  • $6 Trillion In Shadow Banking. Actually, no one knows how large this number is. I have read good data/reports putting this number at $10-15 Trillion range.
  • Empty cities, shopping centers, massive speculative bubble in real estate, built out infrastructure, rising cost of labor and export driven economy.

How much longer can this go on? Well, that’s a Trillion dollar question…..or a $40 Trillion dollar question. Apparently, it is already unraveling. Either way, one thing is for sure, this will not end well nor will it end in an orderly fashion.

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Shocking: China’s Collapse Is Accelerating  Google