Monday, February 27, 2012

Faster-than-light neutrinos? Why nobody is surprised it might be an error.

Technicians check the magnets that direct protons from Gran Sasso, Italy to Geneva, Switzerland

Last year, a team of CERN physicists observed neutrinos traveling faster than the speed of light, but now it looks as though this extraordinary measurement might be the result of a loose fiber-optic cable or a poorly calibrated atomic clock.

Since Einstein formulated his special theory of relativity in 1905, the speed of light has been widely regarded as the universe's ultimate speed limit. Anything moving faster than that – even the spectral neutrino, which hurtles through the universe while interacting with almost nothing, would upend the laws of physics. So quite sensibly, the physics community has turned their attention to possible sources of error.

The primary culprit is CERN's timing system. The technology is extremely complex, but the system itself is essentially composed of two synchronized clocks, one located in Geneva, Switzerland and the other in Gran Sasso, Italy, some 450 miles away. Physicists have been investigating two potential problems: a wrongly calibrated oscillator – which plays a role in synchronizing the clocks – and the fiber-optic cables that feed a GPS signal to the timing system.

That these neutrino measurements are probably the result of a bad measurement came as little surprise to most physicists.The online scientific repository is now replete with theoretical refutations and technical treatises on possible sources of error in these results.

One of these papers, co-authored by Boston University physicist Andrew Cohen, argued that, if the neutrinos actually had broken lightspeed, they would have rapidly lost energy, a phenomenon that was not observed in last year's experiments.

Cohen has long stressed that virtually everyone in the scientific community has, from the outset, approached these results tentatively. He said there isn't any contention in the physics community, and there really never was.

For the last month, this story has been immensely popular, despite the calm skepticism exuded by the majority of the physicists. Why exactly does this sort of Big Physics Cataclysm stimulate the public's imagination?

Let's consider what's at stake.

Literally billions of scientific measurements are predicated on the speed of light being the fastest speed there is. If the CERN results were real, all those would have to be discarded.

Many technologies depend on Einstein's theory as well, most notably, and perhaps ironically, global positioning systems, the possible source of error in the neutrino measurements.

What's more our understanding of the location of stars and other celestial bodies is largely determined by the way light waves contract or elongate when their source is moving, which everything does as the universe expands (another theory that would be upended by these results.) Valid measurements of faster-than-light neutrinos would throw a wrench in our theory how light behaves, leaving us groping in the dark when it comes to our place in the universe.

Cause-and-effect – a concept rather central to the way we think – would be undermined. Einstein's special theory of relativity states that an object traveling at the speed of light is essentially ageless – for it, time stands still. But if an object could break that threshold, then time would, theoretically, reverse direction, and the object could arrive before it departed.

These sorts of ideas are fun to consider. But the mundane reality of science is that for a seminal, well-established theory to be tossed, there has to be more than one anomalous measurement. Physicists will be the first to tell you that our theory of the universe is incomplete, but the knowledge we do have has passed an intellectual gantlet of rigorous scrutiny.

Friday, February 24, 2012

Uncertainties Ahead; Investors Hesitate

Equity stock market stays at high level not seen since the collapse of Lehman Brothers in 2008. Although the majority of market participants think that a pullback is inevitable because equity holders will take some of the profit and drag down market. However, a large amount of equity stocks are in the hands of long term investors. Active market participants have a thin portfolio on stocks and are not willing to trim down further. Day traders activity contributes to a significant portion of trading volume. On the other hand, cash on the sideline is growing and is ready to purchase bargains on market dip.

Since the beginning of the year, market manipulators have not been successful to initiate panic sell-off. This is also one of the reasons that market can stay at current high level despite a lot of speculation that market should fall back.

The speculative trading portfolio does not perform well in this strong market. The majority of stock holding is in small/mid cap stocks, individual performance of which can be volatile and not tracking broad market. Unfortunately, the speculative trading portfolio has a bad selection and suffers quite a loss. The ETF portion of the portfolio follows broad market trend and generates some profit but insufficient to offset the loss in bad stock selection.

Current skills in stock picking is insufficient for speculative trading while there is still room for improvement in market tracking. The experience acquired in the last couple of years will be beneficial to future trading as history will repeat itself and market fluctuates in cycles. It appears that market is now in an upward trend against a wall of worry fueled by ample liquidity of capital as well as greed of investors.

The ABC’s of Reading Stock Charts
"All advances are not created equal," says legendary chart guru Louise Yamada. This is important to remember, even if obvious, during what has been the largely indiscriminate rally of 2012. From Tech, to Energy, to Banks; if a stock has remotely decent fundamentals and it isn't overly defensive, it's probably higher in 2012.

Yamada has guidance on how to let the charts be your guide. Her rules of thumb are easy as ABC, literally. She breaks up basic chart patterns into 3 categories.

A. All Stars
Charts rising above years of resistance with little in the name of headwinds.

As long as the uptrends don't break just hold the names and buy the dips.

B. Disappointments
These are stocks simply pushing into overhead and/or in danger of collapsing after sharp rallies. They may look good on the surface but there's nothing particular you'd want to be involved with for the long haul.

C. Take the Money and Run
Sharp rallies straight into overhead resistance and showing few signs of recovery. The rallies here have looked impressive short-term but are still chopping along and seemed destined to do so for years.

Investors Shrug at U.S. Small-Cap Surge
What if a major stock index jumped to an all-time high, but most investors didn't notice?

That's the awkward situation the Russell 2000 index of small-capitalization stocks could find itself in. The broad cross-section of smaller U.S. companies is up an eye-popping 36% since early October.

As with other U.S. stock classes, few investors these days are actively trading small-cap stocks, which typically have a market value of about $2 billion or less.

Trading volumes on Wall Street have been light for months, hedge funds and investment banks have pared down their trading operations, and the small investors that exited the market after the 2008 financial crisis are hesitant to jump back in—least of all to the riskier small stocks that make up the Russell.

As a result, the few remaining investors and traders are having an outsize impact on small-cap share prices amid the recent improvement in the U.S. economy.

But the air is starting to get thin. Because of the Russell 2000's surge, the small-cap index now trades at about 18.2 times forward per-share earnings, according to data from investment manager Heartland Funds. That is 43% higher than the S&P 500's price-to-earnings ratio of 12.7. Historically, the Russell has traded at a premium of about 30% to the Standard & Poor's 500-stock index.

Other warning signs include technical indicators that suggest small-cap stocks might have run up too fast. Some are also concerned that small-cap stocks could suffer down the road should the Federal Reserve ease off on its low-interest-rate policy, which has pushed investors into riskier assets like commodities and small-cap stocks.

Small-stock bulls say even the retreat from small-cap mutual funds isn't a bad sign. So far, the Russell 2000's rally appears to be fueled by corporate buybacks and investors reversing their bearish bets on small-cap stocks—not pouring fresh new money into small caps.

Short interest on the Russell 2000, a measurement of investors betting on a decline, fell to 6.6% in early February, down from 7.4% in September. Share buybacks among Russell 2000 companies jumped 46% in the third quarter from the previous quarter to $7.8 billion, according to J.P. Morgan's Mr. Singh.

In other words, buying of small-cap stocks so far remains restrained.

If the Russell 2000 can push through to record highs, that alone might trigger a wave of new investor interest. Hedge funds, in particular, are likely to move into more volatile investments like small caps if there is a sense that the market is climbing without them.

Wednesday, February 22, 2012

Error Undoes Faster-Than-Light Neutrino Results

It appears that the faster-than-light neutrino results, announced last September by the OPERA collaboration in Italy, was due to a mistake after all. A bad connection between a GPS unit and a computer may be to blame.

Physicists had detected neutrinos travelling from the CERN laboratory in Geneva to the Gran Sasso laboratory near L'Aquila that appeared to make the trip in about 60 nanoseconds less than light speed. Many other physicists suspected that the result was due to some kind of error, given that it seems at odds with Einstein's special theory of relativity, which says nothing can travel faster than the speed of light. That theory has been vindicated by many experiments over the decades.

According to sources familiar with the experiment, the 60 nanoseconds discrepancy appears to come from a bad connection between a fiber optic cable that connects to the GPS receiver used to correct the timing of the neutrinos' flight and an electronic card in a computer. After tightening the connection and then measuring the time it takes data to travel the length of the fiber, researchers found that the data arrive 60 nanoseconds earlier than assumed. Since this time is subtracted from the overall time of flight, it appears to explain the early arrival of the neutrinos. New data, however, will be needed to confirm this hypothesis.
Science Insider

Apparently neutrinos are not moving faster than light after all — some of the brightest minds in modern physics were bamboozled by a loose wire.

If you care about physics, Einstein or controversies, you’ll recall the excitement last fall about neutrinos that were supposedly moving faster than light. The ghostly particles, which can move through the Earth and through you without slowing down, were leaving a particle beam in Geneva and traveling under the Alps to Gran Sasso, Italy, in less time than it would take light to travel the same distance. The neutrinos were only 60 nanoseconds early, but still — the result, which the experimenters could not explain, suggested they were moving faster than light.

While applauding the Italian researchers’ careful experiments, most of the world of physics assumed the scofflaw particles were the result of some kind of mistake, because nothing can go faster than light. Theories abounded, from fun relativity reasons to simple math errors. It turns out it was even more boring, more humdrum, more insipid than even that — someone hadn’t plugged in a wire all the way. Science Insider broke the news this afternoon, citing unnamed sources familiar with the experiment.

The blame lies with a fiber-optic cable used to connect a GPS receiver, which corrects the timing of the neutrinos’ flight, and a computer card that reads the receiver. As part of the efforts to replicate the results, a team member apparently tightened the connection and then measured the length of time it took the timing data to travel down the fiber. The data showed up, you guessed it, 60 nanoseconds earlier than assumed.

Frankly, this is so boring as to sound almost suspicious.These people with their 5 sigmas and their M-branes and their beta particles just forgot to push the plug in all the way! That would explain it so nicely, do away with the inconvenient superluminal result so cleanly.

Of course, more experiments are needed to prove this either way. All the big physics conferences are ramping up here in the next couple of weeks.

Monday, February 20, 2012

Search continues for secret stamp honoring John Glenn's historic spaceflight

The 1962 4-cent "Project Mercury" stamp marked the first time that the U.S. issued a previously unannounced commemorative stamp at the same time as the event it was issued to honor: John Glenn’s historic Friendship 7 spaceflight.

【】Fifty years ago today (Feb. 20), John Glenn, the first American to orbit the Earth, relied on ground stations located across the planet to communicate with his control team. But after his Mercury spacecraft, Friendship 7, safely splashed down, it was another type of station that took over tracking his historic mission: U.S. post offices.

For the first and only time in the country's postal history, the United States Post Office Department — since 1971, the U.S. Postal Service — surprised the public with the release of a secret stamp celebrating Glenn's successful mission. The 4-cent "Project Mercury" postage stamp was revealed and immediately put on sale in 305 post offices within an hour of Glenn's triumphant return to Earth at 2:43 p.m. EST (1943 GMT) on Feb. 20, 1962.

Half a century later, collectors are still searching for those first-day-of-issue stamps.

"The U.S. Post Office Department signaled the first orbital flight of a United States astronaut today with the issuance of a commemorative stamp, placed on sale throughout the country on the exact hour Astronaut John Glenn's historic flight was officially completed," the department stated. "It is the first time in history that a previously unannounced commemorative stamp was issued simultaneously with the event it memorializes."

As news of the stamp spread over radio and television, the public began lining up at their closest post offices that had stock of the now no longer secret issue. Collectors in particular drove many miles to have their blank envelopes postmarked with the surprise stamp, creating a collectible for that first day's release and the historic space flight it honored.

Without a way to coordinate nationwide, collectors couldn't know however if such "first day covers" existed for all 305 stations. To this day, 50 years later, as many as 20 cities are still missing examples.

Splashdown surprise
The Post Office Department wanted to keep the stamp a secret in case the mission failed. Keeping the production and distribution of more than one million postage stamps a surprise though, required some creative logistics. [ Photos: John Glenn's Space Legacy ]

"Designed and printed under tight security precautions at the Bureau of Engraving and printing, the stamp was distributed well in advance of the flight to more than 300 large postal installations, where it was held intact until the flight was completed," the department stated. "None of the postmasters knew what the closely guarded packages contained until the word was given from Washington [to remove the wrappers and place them on sale]."

A certified plate proof that was printed before production began for the "Project Mercury" stamps at the Bureau of Engraving and Printing. (Smithsonian/National Postal Museum)

Knowledge of the Project Mercury stamp project was kept on a need-to-know basis. Just over 400 people knew the secret, about half of them postal inspectors. The stamp's designer, Charles Chickering, worked from home to create the blue and yellow depiction of Friendship 7 circling the Earth while all along claiming to be on vacation.

The picture engraver also gave the impression he was on leave, but came in at night. Another engraver who did the lettering worked on weekends.

"At the Bureau of Engraving and Printing, a rumor was spread that a new multicolor Giori press was locked away for printing test runs of multicolored money," the USPS later recounted in a 2005 release. "In fact, the new press was being used to print the Project Mercury stamp."

Once the stamps were ready to ship, they were loaded in mailbags with combination locks and marked "Classified Material" and "Do Not Open." They were delivered to the selected postal stations, but addressed to the attention of the postal inspector so curious postmasters wouldn't take an early peek.

Even with all the precautions, the department's secret was almost blown.

According to the American First Day Cover Society's (AFDCS) "First Days" magazine, a newspaper in Florida reported a rumor of a secret stamp in the run up to Glenn's original launch date in December 1961. The Post Office Department was able to successfully dismiss the report and by the time Friendship 7 actually launched, two months later on the mission's 11th scheduled date, the stamp's release came as a true surprise.

Official and unofficial cancellations
The site of the official first-day-of-issue cancellation was Cape Canaveral, Fla., Glenn's launch site, where the Post Office Department established a temporary station.

But given the stamp was a surprise and limited to just 305 post offices, it wasn't long before collectors began trying to assemble nationwide sets. Further limiting the potential for first day covers was the time of day when the stamps were released. [ Infographic: John Glenn, 1st American in Orbit ]

The call from Washington to open the mailbags came at 3:30 p.m. EST. For post offices on the East Coast, such as Boston, New York City, and Baltimore, that meant that customers had only a few hours before the offices closed to obtain first day postmarks. The most time was afforded at the station farthest west, Honolulu, Hawaii, where the stamps were released at 10:30 a.m.

Various "official city" first day covers canceled on Feb. 20, 1962 with the "Project Mercury" 4-cent stamp. (cS)

By the following year, one enthusiastic collector, Patricia Grace Siefert, had compiled a guide. The typewritten "An Unauthenticated Classification of the First Day Covers of the Project Mercury Stamp" documented postmarks from 248 of the official cities, as well as others including U.S. Navy ship-board cancels and "unofficial cities."

In the case of the latter, collectors had purchased stamps from one of the 305 post offices identified by the Post Office Department and then drove to other post offices to have them canceled. By July 1963, Seifert had cataloged 90 of these "unofficial" cities.

Seifert warned however, about the chances for fraudulent covers, particularly when it came to envelopes canceled in unofficial cities. "Especially should we be cautious of covers from cities whose location is at such a distance from one of the official cities that it would have been impossible for the stamp to have been canceled there," Seifert wrote.

City search
The 4-cent "Project Mercury" stamp and its use on covers turned out to be very popular. By the time the stamp was withdrawn from sale on June 6, 1962, more than three million of the 310 million stamps ultimately produced had been postmarked on collectors' envelopes. By the end of the first day, some 10,290,850 of the stamps had been sold.

But the distribution of those millions of covers was not evenly spread across the country. At least 250,000, if not upwards of a million of the stamps were canceled at the Post Office Department's official Cape Canaveral station.

For the other 305 official cities, the number of covers were much smaller. In a few cities in fact, no covers may have been issued at all.

On Feb. 20, 1962, a snowstorm blanketed parts of Ohio, preventing stations in the towns of Mansfield and Marion from selling the stamps. Meanwhile in Warren, Pa., the mailbags were not opened until after the office's customer windows had closed.

Fifty years later, 17 other cities' covers are still missing, not all of them from small towns. Covers have yet to be found for Fort Lauderdale and Tallahassee, Fla., Atlantic City, NJ and Durham, NC, for example.

One the "thousands" of autographs John Glenn has signed over the past 50 years on "Project Mercury" stamp first day covers.

Collectors like Seirfert and Monte Eiserman, who wrote of his experiences in AFDCS's "First Days," pursued finding as many cities' covers as they could. And though interest in the covers has dwindled over the past five decades, there are still those on the hunt.

One such collector, Henry Scheuer of New York City, was profiled by the New York Times for his lead in the search in 1990. Twenty years later, he reported finding a first day of issue postmarked envelope for Little Rock, Ark., one of the cities long thought lost.

And what of the subject of the stamps themselves? For his part, John Glenn says he does not remember how he first learned of the stamps or where he first saw them. But he is very familiar with them now.

"I have certainly seen enough of them since then," Glenn told collectSPACE. "They had first day covers that were put out that day too, and the autograph collectors collect them. I've signed thousands of those things."

Sunday, February 19, 2012

遊人湧沙頭角 有得睇無得食










新光戲院結業前夕再續命 李居明接手 月租100萬





下月起裝修 員工全留任


三度瀕結業 員工﹕最驚險今次



Saturday, February 18, 2012




離蒲台島公眾碼頭只有一分鐘步程的「坤記士多」附近樹林,最近數月被人夷平,工人先用木條圍成多個三呎乘三呎的長方形框,再注入厚兩吋的混凝土,製成多塊混凝土板塊,上面再鋪一塊大約一呎乘半呎的石板。這批混凝土板塊覆蓋附近多個山頭及山坡,粗略估算,最少逾一千個。以Google Map衞星圖片推算,「墳場」涉及的土地面積最少逾十萬平方呎!















Friday, February 17, 2012

Equity Stock Market Picking Up Steam

Market stays at years high without significant sell-off. The reaction of market participants to recent peak without obvious pullback has been expected. Market manipulators appear to have abandoned the panic sell-off strategy as market participants learn the trick to make quick profit from panic sell-offs. Although market participants would no longer dump shares at cheap price, fear remains and there is still wish of buying back the shares at panic sell-off price.

As mentioned in earlier post, market has entered inflexion point and it is now obvious that market participants have strong purchasing desire due to mountain of cash on hand but have patience to wait for bargains. It is still maintained an upward market trend with volatility.

Although market is at high level for the last three years, there is no heavy selling due to profit taking as there is a long queue of buyers at various level down to recent bottom in the second half of last year. Market participants are waiting for pullback to replenish the equity starved portfolio. Day traders dominate the trading activities and the limited supply of shares in market buoys the price. A large quantity of equity stocks have changed hands from panic investors to wealthy entities that have holding power and can tolerate market fluctuations. The dividends already provide a decent return on investment for coming years even if the portfolio value remains distressed.

Market movement is the aggregate of activities from market participants. After market crash in March 2009, the majority of individual investors are reluctant to re-enter the market after selling at bottom. After the rally, there is interest in market but prefer to wait on the sideline until another crash to replenish the portfolio. Nevertheless later market bottoms are successively higher and the opportunities are missed.

The May 2010 flash crash provided the first opportunity after the 2008/2009 financial meltdown. It was observed and mentioned in this blog that individual investors though only a limited portion, were returning to equity stock market in October 2010. Market then moved slowly up until May 2011.

As investors were holding large amount of cash and seeking safety, it was perceived that the demand for Treasuries would not drop after the Federal Reserve bond buying program ended in June. Market oscillated in July. And then market manipulators used the US debt rating downgrade news to initiate panic sell-off among market participants. Since the speculative investment portfolio was optimistic on equity stock market, it was heavily loaded with stocks on high leveraging. The crash caused the portfolio to lose two third of value at the maximum point. After the initial crash, there were several smaller scale sell-offs later. But as mentioned in the posts, each sell-off ended with rally on short covering from market manipulators. The speculative trading portfolio recovered some of the previous loss. But the damage due to the initial crash on US rating downgrade was too large due to over-leverage. Market participants were shocked by the crash and failed to take advantage of this opportunity of another market bottom after the flash crash in 2010. The rally from the beginning of 2012 is a surprise to many market participants.

The above two cycles of market up and down appear to be very similar. Market reaches the top and then followed by a crash. Then market struggles at the bottom while market participants are waiting for further decline. Finally market rebounds and climbs on a wall of worry. So far market participants behaved similarly in both cycles before reaching pre-crash top.

In the last cycle, market oscillated when it reached the level before the crash and then moved up further. In this cycle market has now moved back to the level before the US debt rating downgrade when market participants went into panic sell-off. Currently, market have surpassed the pre-crash top. Therefore it may oscillate at this point and after consolidation, advance further. The driving force behind is the mountain of cash in market participants portfolio and the hunger for return on investment.

Since it is difficult to guess market cycle in very short term, the anticipated oscillation at current market top may have pullback anytime soon. In order to take advantage of the potential market ups, market participants should hold current portfolio and strengthen the holding on pullback. Day traders would speculate instantaneous market movement to maximize possible profit.

As learned from the experience in the market crash triggered by US debt rating downgrade, the speculative investment portfolio maintains some hedging against unfavorable market movement. Nevertheless, it is envisaged that market manipulators would not initiate panic sell-off because cash on the sideline are waiting for bargain buy and market participants would not dump the remaining stocks in the portfolio. Therefore, the speculative trading portfolio remains aggressive with high level of leveraging. Nevertheless, it should be able to withstand a 3% market correction without forced liquidation. A crash like the US debt downgrade may be devastating. Market will be closely monitored for symptom of panic selling. After the US debt rating downgrade, market manipulators initiated sell-off among market participants. The speculative trading portfolio overlooked the impact on the herding behaviour of panic investors.

Although it is unlikely that market participants will go into panic selling again, there is still possibility that heavy selling may come from investors taking profit because long term investors are currently loaded with equity stocks. If buying interest from individual investors fades, market may lose momentum.

Are Stocks Reflecting an Economic Recovery Too Soon?
"It gives us a thesis upon which the case for a more domestically exposed portfolio makes a lot of sense," says Mark Luschini in the attached video. The chief investment strategist at Janney Montgomery Scott is betting on a below average economic expansion of 1.5% to 2%, but "one that looks positive nonetheless."

Right now, with stocks up more than 12% in two months, Luschini's camp is winning the debate. He'd like nothing more than a shallow 3% to 5% pullback to give him another chance to put more money in. In a note clients he writes, "any near-term decline should be used opportunistically to add to positions."

Munson Warns Investors: Be Long or Be Wrong!
Lee Munson, author of the book "Rigged Money" has a stark warning for investors: "You can be long or be wrong this year," says the unabashed former broker.

He believes the second half will be even better than the first and ticks off the following reasons why:

* The horrific global macro news didn't just arrive but is a "spin-off" of a disastrous fourth quarter. The U.S. is much more insulated from Europe's mess than is widely believed.

* Earnings growth doesn't have to be explosive to support higher stocks. Even if 2012 EPS for the S&P500 comes in at $100 --roughly what the stocks in the S&P500 earned in 2011-- stocks wouldn't hit their historical average P/E until S&P 1,500.

* Expectations continue to be downgraded, and too much so in Munson's estimation. By the time the analysts catch up, the best of the rally may be behind us.

* Greece will eventually be out of the headlines. Not fixed, just not a negative national obsession.

The CIO of Portfolio LLC opines that Europe's impact could even be bullish given the enormity of Euro-printing on deck for the next 12 to 24 months. If quantitative easing was bullish in the States (and it was), the impact of QE on a global basis will support stock advances, particularly in the relative safe-haven that is the U.S.

With the rally only starting to pick up steam, Munson says it still makes sense to start ditching what worked last year in favor of taking on more risk. Forget defensive names and avoid dividend plays. Grab beta, he advises, referring to stocks that are more volatile than the overall market. Beta will bury you in a bear market but as we've seen already this year, a bullish tape makes beta an investor's best friend.

Generally speaking Munson thinks too many market participants are thinking and stressing too much; confusing looking "smart" with making money. The trend is on the bulls' side and until that changes shorting stocks is a mug's game.

Dividend Payouts Are Climbing After Plunging to a Record Low
Corporate America may be getting ready to share a bigger chunk of its record profits with investors, who lately have been getting a record-low piece of the pie.

Dividend payouts already are rising and the total dollar amount by S&P 500 companies could reach a record high this year. Standard and Poor's analysts expect the dividend payout for the S&P 500 to surpass the record $247.9 billion paid out in 2008.

"I think there's a change in investor appetite for risk, and that in the last couple of years that has resulted in better performance for dividend paying the extent dividends are being paid. There are also plenty of companies choosing to do share buybacks," said Gina Martin Adams, Wells Fargo institutional equities strategist.

Dividends have provided the bulk of return to long-term shareholders for quite a while, and companies are just beginning to catch on to the fact that investors are seeking dividend-paying stocks and will reward them, according to Adams.

Adams said the investor mentality has shifted as sources of yield have dried up in the current record low interest rate environment.

Stocks vs. Earnings: A Surprising Inverse Correlation
Even an uber-bull would have to concede that under normal conditions, those two lines should move together and that 0% earnings growth is hardly the fuel needed to drive stocks higher. Yet Butters points out that this is the 17th time in the past 40 quarters that such an opposite - or inverse - move has occurred.

In the meantime, he like many of us, he won't be surprised to see ''a little pullback" and some increased volatility return after the hottest start to a new year in more than a decade. He's focusing on companies that do business in emerging markets that can deliver profit growth, including industrials and technology, and if they pay a dividend too, all the better.

QE3 or No QE3? The Only “Transparency” the Market Cares About
The minutes of the Fed's January meeting today are likely to shed some insight on just what the heck FOMC members were thinking when the central bank pledged to keep rates at zero through 2014, at least.

In addition to potentially shedding light on that conundrum, the big issue for the market is whether the minutes will reveal any plans for another round of quantitative easing.

"The market cares about one thing: Whether the Fed is going to do QE3," Bianco says. "The Fed's promise to keep rates low for an extra year makes market believe it's more likely. If we get anything that throws cold water on the idea QE3 is coming, the market would react negatively."

Conversely, "stock and risk markets will respond positively" to any further indication on the timing or likelihood of more Fed asset purchases, he notes.

Stocks Can Rally Another 10% and Still Be Cheap: Fund Manager
"Anything to keep the consumer spending right now," says Ted Parrish, fund manager, Henssler Financial in the attached video. "I think it will keep the growth going. We don't need to detract from that."

"We've had 19 weeks of positive economic data and we need to keep that going," he says.

Parrish believes earnings and an improving political environment should allow the S&P 500 to continue its rebound toward all-time highs, and is targeting a move to 1495 by year-end.

Parrish believes earnings and an improving political environment should allow the S&P 500 to continue its rebound toward all-time highs, and is targeting a move to 1495 by year-end.

"Overall, the market's just cheap," Parrish says, and argues that earnings have grown by more than double the rate of stock prices since 2008, which means there's still lots of catching-up to do.

Home buying: Most affordable in decades
Buying a home is now more affordable than it has been in the last twenty years.

Thanks to continued declines in home prices and rock-bottom mortgage rates, the National Association of Home Builders/Wells Fargo Housing Opportunity Index hit a record level of affordability.

Unfortunately, being able to afford a home and actually being able to buy one are two different matters entirely. According to Barry Rutenberg, chairman of the National Association of Home Builders (NAHB) and a home builder from Gainesville, Fla., potential home buyers are still finding it difficult to land mortgages.

US Housing Among Most Attractive Assets: Marc Faber
The housing market in the south of the United States is among the most attractive asset classes in the world, Marc Faber, the editor of the Gloom Boom & Doom Report, told CNBC on Friday, because while homebuilder stocks had rallied, property prices hadn't moved much.

Faber said he went to see homes in Phoenix and Atlanta, and in some cases, U.S. homes were cheaper than those in Thailand, where he lives.

At the same time, the fact that people couldn't get credit to buy homes in the U.S. was helping to boost the rental market, he added.

Faber said plenty of investors were already making money by buying distressed homes, but he said the fragmented nature of the market didn't benefit large investors with billions of dollars of capital. Rather, he said it was more nimble investors who were doing well.

Dear Walmart, McDonald’s, Starbucks: How Do You Feel About Paying Your Employees So Little That Most Of Them Are Poor?
The rich keep getting richer and the poor stay poor, and many folks who used to have decent jobs and lives in the middle are now joining the ranks of the poor or near-poor.

The disappearance of America's middle-class is generally attributed to the "loss of manufacturing jobs," as technology replaces people and companies move jobs overseas.

But the real problem is the loss of good-paying jobs, not the loss of manufacturing jobs.

Many Americans who used to have middle-class manufacturing jobs--or who would have had them had they not disappeared--now work in low-wage service jobs at companies like Walmart, McDonald's, and Starbucks.

The consensus about these low-wage service jobs is that they're low-wage because they're low-skilled.

A century or two ago, many of the manufacturing jobs in the economy paid extremely low wages, and the work was done in dangerous, unhealthy environments. Then workers began negotiating collectively, and wages and working conditions improved.

Corporate profit margins, in fact, are close to an all-time high, while wages as a percent of the economy are at an all-time low.

Obama wants cheaper pennies and nickels
The U.S. Mint is facing a problem -- especially during these penny-pinching times. It turns out it costs more to make pennies and nickels than the coins are worth.

To be precise, it cost 2.4 cents to make one penny in 2011 and about 11.2 cents for each nickel.

Given the number of coins that the mint produces -- 4.3 billion pennies and 914 million nickels last year alone, those costs add up pretty quickly: a little more than $100 million for each coin.

Despite popular belief, since 1982 pennies have only been copper plated, not copper through and through. Much less expensive zinc makes up 97.5% of the mass of a penny, the rest is a copper coating.

Nickels actually have much more copper in them -- 75% copper and 25% nickel, the same mix it has always had.

Treasury had already made a cost-saving move in December when it stopped making dollar coins.

With 1.4 billion surplus presidential dollar coins sitting in bank vaults waiting to be circulated, and American consumers showing little appetite to start using the coins, Treasury estimates the halt in production of the coins will save about $50 million a year.

Sunday, February 12, 2012



Friday, February 10, 2012

Market Pullback After Consolidation

Equity stock market runs out of steam finally after several weeks of gain. There is a pullback on the last trading day of week. Market participants are worry that market will retreat after this strong rally.

Although market have advanced significantly since beginning of the year, the majority of market participants are frightened by the sell-offs in the second half of last year. Many investors have sold stocks near the bottom due to fear and prefer to hold cash. They have been waiting for market collapse to replenish the portfolio. Therefore the rally benefits mostly those long term investors with holding power and risk taking.

Market manipulators do not attempt to trigger a panic sell-off. Selling is mostly from day traders and speculators. There are also some profit taking since some buyers at market low want to realize part of the profit and wait for another opportunity. Institutional investors maintain the level of equity stock holding while performing re-allocation. There is also influx of capital due to increasing interest of investors in equity stocks. It would encourage further buying when market heats up. Individual investors also exhibit buying interest but are waiting for bargain while market is climbing a wall of worry.

As market participants have different speculation, market dynamics will change depending on global economic environment and capital flow. However, there is sign that investors are looking for higher return on investment and are starting to pour money into the equity stock market after three years of low interest rate environment.

Market manipulators do not use the panic sell-off strategy when traders are speculating a pullback. This would in turn increases the confidence of market participants and some impatient investors may start to chase stocks. Nevertheless, market participants are currently very cautious and herding behaviour prevails. Traders, speculators, and manipulators are competing for market movement.

Why small companies' stocks deserve a closer look
Underperforming money managers are losing their most reliable scapegoat.

Since the 2008 financial crisis, the nation's professional stock-pickers — who manage billions for pension funds, endowments and wealthy families — have said stocks were too stuck-together to build smart, market-beating portfolios.

Meanwhile, the Russell has been on a historic upswing, gaining more than 36 percent in the past four months, compared with 22 percent for the much-bigger companies in the Standard & Poor's 500 index.

"This should have been a period when stock-pickers should have done well, and unfortunately, it just didn't happen," says Lori Calvasina, the lead author of the Credit Suisse report. "It does feel like this was an opportunity that got missed."

So how did so many fund managers end up holding the wrong stocks? They were too cautious, Calvasina says.

Late last year, many were afraid that Europe's debt crisis would boil over, threatening the U.S.'s slow economic recovery. They set about buying "high-quality" stocks — bigger companies, often in industries that do well when the economy is weak. Traders also bid up stocks of companies that do most of their business here in the U.S., Calvasina says.

Those aren't the stocks driving the Russell index's gains. As the economic outlook has improved this winter and traders have grown less worried about Europe, stocks have gained the most in sectors that are sensitive to the economy, such as homebuilders, boatmakers and furniture manufacturers.

But this year's small-cap gains aren't merely a normal rebound from last year's overselling, says Doug Roberts, chief investment strategist with Channel Capital Research. He says they're also a result of the Federal Reserve's policy of keeping short-term interest rates near zero.

"It's the cheap money, or the liquidity, that drives up stock prices," he says.

John Fox, director of research at Fenimore Asset Management in New York state, says traders should look for companies that aren't already picked-over by Wall Street analysts.

"In small-cap world, you have many more stocks to pick from, and you can find companies that may have one analyst looking at them, or no analyst coverage at all," he says. "That's what's different."

Why Dividend Stocks Aren't the New Bonds
OppenheimerFunds portfolio manager Daniel Loughran explains to WSJ's Karen Damato how muni funds can offer a bigger payout than what Treasurys and some other bonds are providing, despite some risks.

For many investors who crave steady income, bonds don't look as good as they used to.

"People may not appreciate that moving from bonds to stocks is a major change in asset allocation," says Joseph Davis, chief economist and principal at Vanguard Group.

Investors should also remember that dividend-paying stocks don't always behave like other stocks, either. Dividend payers are often larger, established companies—which means they often aren't perceived to have the same potential for earnings and revenue growth as smaller firms. When the rest of the market is booming, dividend payers are often lagging behind the crowd.

To be sure, they often deliver better results than other stocks during market selloffs, since the income they provide makes up for some of the lost return. But investors can get the same kind of downside protection from bonds—with substantially lower capital risk.

For all the caveats in this category, investors have been plowing money into these dividend-focused funds.

If you're thinking of using dividend-paying funds as a source of income, here are some pointers that will help you make the most of your investment.

DIVERSIFY YOUR INCOME SOURCES. To limit stock-related risk and boost income, plan to get income from a mix of bonds, as well as dividend-paying stocks.

OWN SOME STOCKS JUST FOR GROWTH. Most investors—even those who already have entered retirement—need the capital appreciation that stocks can generate to reduce the risk of outliving their assets.

BE MINDFUL OF FUND COSTS. For many investors, mutual funds are the most practical way to get exposure to stocks that pay dividends. Unless you have several hundred thousand dollars to invest, you probably can't buy enough individual stocks to get reasonable diversification in your portfolio.

BE SURE YOU'RE COMFORTABLE WITH OVERSEAS EXPOSURE. One classic strategy for income-oriented investors—and the funds that cater to them—has been to blend U.S. stocks with European stocks, since the latter historically have had higher yields.

BRACE FOR STOCK-MARKET TURMOIL. While you are collecting periodic income distributions from a dividend-oriented stock fund, the share price of that fund will be moving up and down, sometimes resulting in periods when the overall return is negative. Look at a fund's total return over several years, rather than just its yield, to gauge its overall performance and compare it with peers. (With individual stocks, remember that a struggling company may cut or eliminate its dividend.)

It is important to hang in there, despite the market's ups and downs.

You can't fully benefit from owning equities unless you hold them for a multiyear period, says Quintin Price, chief investment officer for fundamental equity at BlackRock Inc. That means "you've got to have patience to withstand the volatility,'' he says.

Corporate profits aren't what they seem
While other parts of the economy struggled the past two years, large companies managed to rack up higher profits quarter after quarter.

At the start of the bull market in March 2009, when stocks hit 12-year lows, many professional investors worried that the weak economy would keep a lid on profits. But companies cut staff, squeezed more out of the workers who remained and made more money than nearly anyone expected.

Skeptics noted that companies could only cut so much. But companies kept cutting and squeezing and posted even higher numbers. Then, when domestic revenue didn't grow as quickly as expected, companies compensated by finding buyers abroad, and posted higher profits again.

For eight quarters in a row through last year's third, companies in the S&P increased earnings by double-digit rates. The average increase was a blistering 41 percent. By contrast, the average increase over the past quarter-century is 8.2 percent — not counting the fourth quarter of 2009, when earnings growth was astronomical but the comparison was misleading because of the financial crisis a year earlier.

Investors buy and sell stocks mostly based on what they expect companies to earn in the future, not on what they made in the past. And though dour in the short run, investors expect big gains as economies of the U.S. and some of its big trading partners pick up later in the year.

Forget Europe, U.S. Stocks Will Rise 10% This Year: Ablin
The news from Europe seems worse by the minute as negotiations between Greece and international lenders continue to drag along, leaving investors to wonder whether stocks can remain oblivious to the overseas situation.

According to Jack Ablin of Harris Private Bank, stocks are actually pricing the European crisis in, and that's the only reason we aren't up even more than we are. By Ablin's math, international turmoil masked a recovery story in the U.S. that should have pushed domestic markets to near double-digit gains in 2011.

"Economics is a social science; it's an allocation of resources," Ablin says. That being the case, more resources will be coming into the U.S. while the rest of the world struggles through the pain. It may not be a great bullish theme but it should be more than enough to keep the wheels turning over here.

Fink: Investors Should Be 100% in Equities
Investors should have 100 percent of investments in equities because of valuations and higher returns than bonds, said Laurence D. Fink, chief executive officer of BlackRock Inc., the world's largest money manager.

Investors who seek the safety of treasury bonds will have minimal returns and will not be able to meet their needs with the U.S.

"You need to take on more risk, you need to overcome all this noise," he said in an interview with Bloomberg Television in Hong Kong today. "When you look at dividend returns on equities versus bond yields, to me it's a pretty easy decision to be heavily in equities."

Is Market Volatility Gone for Good?
For investors who came of age after 2000 there's been only one way to make and keep money in stocks: Trade. Buy panic, sell fear. Lather, rinse, repeat. At least for the moment, 2012 has marked the rebirth of "buy and hold." Don't take gains, don't be afraid to chase, and for the love of all that is holy don't get short.

Stepping away from emotion and looking at companies both here and abroad Speiss wants to know "when are they going to start hiring again to drive greater economic valuation increases?" In English, when will global corporations start growing their businesses instead of hoarding cash and waiting for an all-clear signal that's never going to come.

Regarding stock valuations as attractive and not expecting the world to get less complicated, Speiss suggests clients stick to their knitting and invest in a way that makes sense to them. "Everyone's psyche is not the same," he says, and neither are their goals. That being the case get positioned for the long-term now and buckle up before the market snaps out of it's daze and resumes its dance between greed and fear.

Sunday, February 5, 2012

英女王登基鑽禧 特訓凱特「接班」




寵愛有加 盼分擔王室職務




英國王宮首席歷史專家沃斯利(Lucy Worsley)稱,「在位60年本身已是重大成就」,民眾都認同英女王投入公職,犧牲很多,令她總能在多事之秋為王室挽回聲望。王室今天並未安排特別的慶祝活動,鑽禧慶典將於6月進入高潮,屆時將有泰晤士河船艦巡遊、鑽禧午餐慶祝會、白金漢宮音樂會等。

Friday, February 3, 2012

Stock Dumping Ceases; Buying Pushes Price Up

Equity stock market reaches highest close since 2008. Market participants remain cautious on buying as market climbs on a wall of worry. The Facebook IPO filing also raises investors interest in stock market. Earnings continue to come out which indicate modest growth in economic activities. Data also shows that the economy is reviving.

Market manipulators have not yet made any movement besides the failed attempt to use the European creditworthiness downgrade to start a sell-off. As market crawls back to the peak when market manipulators started to unload the portfolio and then used the US rating downgrade to short the market, the scenario of a market collapse looms large among market participants. However, since cash or equivalent remains a large portion of the portfolio, traders and speculators are reluctant to sell the stocks on hand at cheap price.

The recent sell-offs and rallies since May 2011 in the stock market illustrates the wealth transfer mechanism in the finance market. The 2008/2009 financial meltdown vaporized a lot of wealth and only a fraction is recovered. But in this cycle, the whole market capitalization is restored back to May 2011 peak. This means that the aggregate wealth of market participants remains roughly the same as May 2011. But the current distribution is different. Market manipulators are the biggest gainers although they are not benefited from the 2012 rally. They have sold stocks around the peak in May 2011 and made additional profit in shorting the market upon US debt downgrade and European sovereign debt crisis.

The performance of hedge funds and institutional investors varies. The 2012 rally enables some investors to recover the loss in 2011, especially those with asset re-allocation of increased stock holding in the portfolio.

Individual investors are lagging behind. Market manipulators are making large profit at the expense of panic selling from market participants. Individual investors make similar mistake as in market bottom in 2009. The herding behaviour during panic sell-off drives investors to dump the portfolio thinking that the sold stocks can be purchased later at a much cheaper price. When smart investors begin to grab the bargain, fear of market collapse makes panic investors to stay on the safe haven of cash and watch the rebound.

The speculative trading portfolio is also suffering significant loss due to the massive sell-offs. However, the loss is largely because of over-leveraging rather than fear. During the period from market peak in May 2011 to the time before the US rating downgrade, the portfolio value stayed within a range. But the US rating downgrade was exploited by market manipulators to trigger panic sell-off. Since the speculative trading portfolio was holding stocks with over two times leveraging and market dropped significantly for several days, the portfolio value fell down to only one third of the initial value and resulted in forced liquidation. If the portfolio can hold on from the sell-off, it would be making profit instead of losing more than one third of the value at present.

As mentioned in an early post, leveraging can be destructive to a portfolio against strong headwind in unfavorable market condition. On the other hand, leveraging can magnify profit. In addition, the portfolio is relatively small and the overhead cost of broker commission and buy/sell spread can eat into any profit or worsen any loss. Since the portfolio is not for savings but speculative trading, borrowing may be needed at present but risk mitigation is necessary.

The outlook for equity stock market remains optimistic. However, it is inadequate to perform speculative stock trading based on macro economic condition. Stock market is highly manipulative. A panic sell-off can almost wipe out entire highly leveraged portfolio in a few days as in the US rating downgrade experience. In order to survive in an environment full of predators, investment decisions should be based on short term market participants behaviour.

The speculative trading portfolio does not perform satisfactorily with respect to tracking market movement. Market will remain turbulent as market participants have diverse speculation. Trading skills may be improved through learning and practice.

Robert Shiller: A Housing Bottom? What Are They Thinking?
One of the key attributes of most bubbles is that, when they finally burst, prices tend to "overshoot" on the downside, crashing well below fair value until all the exuberance is wrung out of the system.

BLODGET: A lot of people have just called the bottom in the housing market in the United States, and there's been some okay data recently. Is that your take? That finally housing prices are bottoming?

SHILLER: When people phrase is that way, they say 'we've reached the bottom.' That suggests that we have the expectation of a major turning point right now. But I don't see that. I don't see any reason to think that prices are going to start heading up dramatically now. We do have some good news. Permits are up. Notably, the National Association of Homebuilders Housing Market Index is up and that's a forward-looking index. But it's not up very much. If you look at the rate of change it looks dramatic but it's still at a low level.

BLODGET: And what about price-to-income and price-to-rent?

SHILLER: Those things have come down a lot. I don't know exactly where the middle is but it's not like we're overpriced anymore. Now the question is whether we'll overshoot, which is a common thing that happens after bubble burst.

BLODGET: Part of your argument there is that profit margins tend to regress to means and right now we're at an all-time high profit margin or very close. Do you think that profit margins can continue going up for U.S. companies?

SHILLER: Profits have been very volatile over the last ten years. They look much more strongly mean-reverting than in the past. So that suggests that the current strong profits might turn out to be misleading.

BLODGET: When you think about smoothed earnings as a way of predicting prices, do you think about it as a predictor of what the price is going to do or is it better to think about it as the likely ten year return for the market is 'x' at this particular price?

SHILLER: You could go either way... I think that the returns that we could see going forward are not lousy, they're low...

S&P Warns of Cuts; Another US Downgrade Coming?
Concerns over the size of United States debt reared their head once again as ratings agency Standard & Poor's warned that health care costs for a number of highly-rated Group of 20 countries, including the U.S., could hurt growth prospects and harm their sovereign creditworthiness from the middle of this decade.

"Is the U.S going to be downgraded again? We think so," he told CNBC on Tuesday. "Our general perception is it won't have a material impact. It could even lead to more money flowing to the U.S in the way we saw following the initial downgrade."

S&P's first downgrade has not driven up the United States' borrowing costs and the dollar appreciated relative to other currencies in the months following the cut as investors sought out safe havens to escape the European debt crisis.

"The U.S. [dollar] is a reserve currency. It's able to retain all the confidence of international investors," Owen said.

Barry Ritholtz: Yes, The Economy’s Lousy, But Stocks Still Look Good
The stock market got off to a surprisingly strong start in January, posting the best first-month results in more than a decade.

But Barry Ritholtz, the chief investment strategist at FusionIQ, isn't surprised by this. Having come into the year "fully invested" in stocks, he has been looking for reasons to sell, and he just hasn't seen any yet.

All the free money the Fed and the European Central Bank are pumping into the system is flowing straight into asset prices. And for now, anyway, this ocean of cash is drowning concerns about fundamentals.

Take Profits Now: Richard Suttmeier
Richard Suttmeier, chief market strategist at says the market's mighty rally is reaching the point of exhaustion, suggesting it's time to use the nascent euphoria to take profits.

Before scoffing, recall that Suttmeier famously told Breakout he was looking 1,000 point drop in the Dow Jones Industrial Average last May 18th. Over the next 4 months the Dow dropped nearly twice that amount before bottoming just under 10,500 last October 4th.

"My thinking is we will not trade above the 2011 highs in the major averages," he says, pointing to the 2011 highs just under 13,000 on the Dow. According to his work, 2012 is going to "stay for most of the year in the trading range" between last year's highs and the October bottom at 10,400.

Suttmeier incorporates fundamentals into his work as well, screening thousands of stocks on a valuation basis. On that front he sees 65% of the market as undervalued, not bad but nothing compared to his view last Fall when that same number was 93.5%. "Stocks remain undervalued," he says, but quickly cites the ever-daunting global uncertainties as a reason they will stay that way.

Stocks jump on strong jobs report for January
A drop in the unemployment rate to its lowest level in three years propelled stocks higher Friday. The Dow Jones industrial average jumped more than 130 points, drawing the average to its highest mark since before the financial crisis hit in 2008.

The Nasdaq index reached levels last seen in December 2000.

Romney's ‘Very Poor' at Highest Percentage in 35 Years as Safety Gaps Grow
Republican presidential candidate Mitt Romney's statement that the "very poor" don't concern him comes at a time when the portion of Americans living in deep poverty is the highest in more than a generation while assistance varies widely and is often inadequate.

More than 20 million Americans live in a household with income of less than half the federal poverty rate, the level social scientists often use as a category for the very poor, according to census data for 2010. Last year that meant an annual income below $11,057 for a family of four.

The portion of the population in that category was the highest in at least 35 years and has almost doubled since 1975, from 3.7 percent then to 6.7 percent in 2010.

"The social safety net has great big holes in it," said Candy Hill, senior vice president for social policy and government affairs at Catholic Charities USA. "In real time on the ground, we're seeing exponential increases of people coming to our door for basic needs: emergency financial assistance, food, housing."

Zedlewski said assistance for the poor may be reduced as state budgets contract and with the loss of billions of dollars of federal assistance for welfare and job programs that were included in the stimulus package.