Car Buying Advice From Around the Web

You've likely heard that a new car loses value as soon as you drive it off the lot, making used cars a better value. But for the past several years, it's been hard to find a good deal on a pre-owned vehicle because supply was tight while people were hanging onto their cars longer during the recession. Finally, though, more cars are streaming onto the used market. with more supply, prices are dropping and deals can be found. So if you're in the market to buy a car, here are tips from some of our favorite personal finance bloggers to help you buy used -- or new, if you can't find a pre-owned vehicle that fits your needs.

SEE ALSO: How to Get the Best Deal on a Used Car

5 Tips for Finding a Quality Used Car [MoneyNing]
"Finding a quality used car is no easy feat, so you need to allot yourself plenty of time to do so."

6 Things You Should Check Before Buying a Used Car, But Don't [Money Talks News]
"That used car might look sleek, but you must do your homework to find out if it is actually dependable."

Stop Worrying ... You Probably Didn't Pay too Much for Your New Car [Bargaineering]
"With all of the information available, shame on us if we pay too much for a new car. But in many cases, we're probably getting a better deal than we think."

An Example of How to Save a Bundle on a New Car [Free Money Finance]
"There are a lot of hidden rebates, incentives, and the like that are unseen by consumers. One tried and true way you can ferret them out is by getting competing dealerships to bid against each other."

5 Tips on How to Negotiate a Car Loan [Money Crashers]
"You will have to be prepared for the never-ending sales pitch that is about to come."

Hedge Funds Hate These 5 Stocks -- Should You?

BALTIMORE (Stockpickr) -- There's nothing hedge fund managers love more than talking their books Professional investors relish every opportunity to go on TV or speak at a conference to tell you what they're investing in (and why you're making a mistake by not doing the same). That's part of the reason why retail investors get fixated on the stocks that fund managers are buying.

>>Warren Buffett's Top 25 Stocks for 2014

But finding out which stocks fund managers are selling can often be even more useful for investors.

For starters, admitting to their "sell list" is usually an act of contrition for hedge funds; even the most disciplined investors don't like admitting spotlighting the names they're getting creamed on. Sure, investors love knowing what the pros are buying -- that's only natural. But it's the sell list -- the names that institutional investors hate the most -- that represent some of the biggest conviction moves. Scouring fund managers' hate list is valuable for two important reasons: It includes names you should sell too, and it includes names that could soon present buying opportunities.

>>5 Stocks Ready for Breakouts

That's why, today, we're taking a closer look at five stocks that topped hedge funds' sell lists in the last quarter.

Why would you buy a name that pro investors hate? Often, when investors get emotionally involved with the names in their portfolios, they do the wrong thing. The big performance gap between hedge funds and the S&P 500 Index in the last year and change is proof of that. So that leaves us free to take a more sober look at the names fund managers are capitulating on.

Luckily for us, we can get a glimpse at exactly which stocks top hedge funds' hate lists by looking at 13F statements. Institutional investors with more than $100 million in assets are required to file a 13F, a form that breaks down their stock positions for public consumption.

>>5 Stocks Hedge Funds Love This Summer

From hedge funds to mutual funds to insurance companies, any professional investors who manage more than that $100 million watermark are required to file a 13F. So far, 495 hedge funds filed the form for the most recent quarter, so by comparing one period's filing to another, we can get a sneak peek at how early filers are moving their portfolios around.

Without further ado, here's a look at five stocks fund managers hate.

International Business Machines

There's no single stock that funds hated more last quarter than $200 billion tech behemoth International Business Machines (IBM). All told, early-filing investment funds sold off 2.56 million shares of IBM in the last three months, shedding more than 15% of their holdings in the firm. Now the question is whether it makes sense to join them in the selloff.

>>3 Huge Tech Stocks on Traders' Radars

IBM is one of the largest names in the technology sector and a perfect example of the prototypical blue-chip stock. The firm's diverse spectrum of IT offerings includes hardware, software and services in more than 170 countries. As enterprise IT spending continues to enjoy some economic tailwinds, IBM is sitting on the right side of a significant trend. One of IBM's most important businesses is mainframes, which continue to be critical in processor-intense industries like finance, communications and research. Because barriers to entry are high in the mainframe business, IBM remains one of a handful of firm's that's qualified to build, sell and service them.

It's important to note that IBM has shown a willingness to make significant changes to its business when necessary. A perfect example of that was the sale of its consumer PC business back in 2005. Other computer companies have made similar moves as the PC market became increasingly commoditized, but IBM was first to the punch. Because of its entrenched nature, IBM's business isn't going anywhere anytime soon. But that's also one of it's biggest problems: The firm's business is so big that it's proven difficult to move the needle in recent years.

Investors searching for growth should look elsewhere, but investors looking for a consistent dividend and a cheap earnings multiple could do worse than IBM.

As of the most recently reported quarter ended March 31, IBM also showed up in Ken Fisher's portfolio and was one of Warren Buffett's top holdings.

Bank of America

Last quarter, no single sector got sold off by hedge funds as hard as the financial sector. And no financial stock got sold off as hard as Bank of America (BAC). So far, hedge funds have unloaded 18.81 million shares of the big bank, a greater than 20% reduction in those funds' overall BAC holdings. That makes BAC a perfect example of a conviction sell.

>>5 Dividend Stocks Ready to Pay You More

Bank of America tips the scales as one of the biggest financial institutions in the world. The problem is, it's the worst of the big banks. The firm arguably made the worst acquisitions in the wake of 2008's financial crisis, enduring a continuing barrage of problems from its Countrywide buy. But as the fees and judgments taper off, BofA could be close to turning a new leaf. The new firm boasts a lower cost structure, an absolutely massive deposit base and (importantly) ample regulatory scrutiny. Those three factors should help close the glaring gap between BofA's returns and those of its peers.

Make no mistake, as of this this moment Bank of America is still the worst of the big banks. Thanks to Fed rules over dividend payouts, dividend yields have become a quick and dirty barometer for financial health -- and BAC's 0.26% yield is indicative of the firm's shortcomings. An emphasis on deposit-building and fee-based businesses like wealth management and credit cards should help correct that, but there's no shortage of better options in the banking industry right now.

It makes sense to sell alongside fund managers.

As of the most recently reported quarter ended March 31, Bank of America was one of Mohnish Pabrai's top holdings. For another take on the stock, here is why TheStreet Ratings rates Bank of America a buy.

First Trust Dow Jones Internet ETF

It's surprising to see the First Trust Dow Jones Internet ETF (FDN) on the list of most-sold fund holdings. This $1.7 billion exchange-traded fund is an obscure name to rank alongside household names such as IBM and Bank of America in terms of shares sold. But funds absolutely hate FDN right now, and they're selling this fund en masse as a result. Last quarter, funds sold 5.1 million shares of the Internet ETF, leaving just 652,000 shares in their portfolios when the quarter ended.

>>Beat the S&P With 5 Stocks Everyone Else Hates

The First Trust Dow Jones Internet ETF owns a concentrated basket of internet companies. Given the huge returns of Internet names in the beginning of 2014 (and the big correction in momentum names last quarter), it's not hard to see why this ETF would be a popular holding for hedge funds chasing that performance (or why they'd be sellers last quarter). FDN is a top-heavy ETF: The top 10 holdings in FDN add up to more than 54% of its total portfolio. Amazon.com (AMZN) alone contributes 9.15% of the fund's allocation. Google (GOOG) is another 10%. And Facebook (FB) and eBay (EBAY) are weighted 8.5% and 6.1% respectively. While that makes FDN a good way to get exposure to large cap internet names, this isn't a very useful ETF for investors who want exposure to more exciting (and volatile) IPO names.

The irony is that fund managers' timing couldn't have been much worse in selling FDN. That's because, since the end of May, Internet names have bounced back in a big way -- and FDN has climbed more than 10% versus a 6% move in the S&P 500. From a purely technical point of view, it looks like momentum is alive and well in this ETF again, and the fund could see higher ground before the year is over. A breakout above $61 is a significant buy signal to keep an eye on.

For exposure to "Internet stocks" as a group, there's no easier way to get it than the First Trust Dow Jones Internet ETF.

Hasbro

Fund managers' timing on Hasbro (HAS) has been a lot better. Hasbro is down 8.4% from its second-quarter high water mark, and funds have been selling off shares along the way. All told, early filing funds unloaded 4.37 million shares of the $7 billion toymaker, a number that adds up to 70% of their previous holdings in HAS.

>>3 Stocks Rising on Big Volume

So should you sell too?

Hasbro sells some of the most important (and best-monetized) brands in the toy business, including Transformers, My Little Pony and G.I. Joe. The firm also owns a stake in The Hub, a children's TV channel that's a joint venture with Discovery Communications (DISCA). The connections between entertainment and toy sales are impossible to ignore -- and it certainly beats the conventional sales model of paying to advertise elsewhere. Licensing other brands is another important source of revenues for HAS: the firm's licenses include hugely popular names like Star Wars and Marvel.

While Hasbro has some impressive bona fides, real growth hasn't been there for the last several years. The firm's second-quarter earnings call on Monday was a disappointment to investors (even though the firm beat expectations on a comparable basis), and momentum has clearly rolled over in shares. Hasbro may be the most front-and-center toy stock, but it hasn't been executing like it should be. I'd be selling shares alongside fund managers this quarter.

Hershey

Last up on hedge funds' sell list is iconic candy maker Hershey (HSY): Funds unloaded 790,000 shares of the confectionary stock last quarter, dropping their stakes by almost $74 million at today's prices.

Hershey is the biggest candy company in the country, with a 43% share of the total domestic market for chocolate. Besides its namesake brand, some of the notable names in Hershey's portfolio include Reese's, Kit Kat and Twizzlers. HSY's sales are extremely concentrated here in the U.S. While the firm has a presence in some 70 countries, those overseas sales only contribute 15% to the top line. And while that presents a material growth opportunity for HSY in the years ahead, management has had a long time to address that void with limited progress.

The real black clouds for Hershey are commodity costs. The firm has already announced that it will be hiking prices next year thanks to pressure from input costs, but the modest price increases shouldn't impact demand. Private label candy sales are minimal, and Hershey enjoys strong consumer stickiness with its brands. HSY has quietly been delivering stair step growth for shareholders in recent years and, despite under-exposure to international sales, that trend looks likely to continue (especially given those price hikes next year).

Hershey isn't a flawless name, but funds are premature in unloading it.

As of the most recently reported quarter ended March 31, Hershey showed up in Renaissance Technologies' portfolio. I also featured it last month in "5 Dividend Stocks That Want to Pay You More in 2014."

To see these stocks in action, check out the Institutional Sells portfolio on Stockpickr.



-- Written by Jonas Elmerraji in Baltimore.

RELATED LINKS:

>>5 Hated Earnings Stocks You Should Love

>>3 Stocks Under $10 to Trade for Breakouts

>>5 Defense Stocks to Trade for Gains This Week

Follow Stockpickr on Twitter and become a fan on Facebook.

At the time of publication, author had no positions in the stocks mentioned.

Jonas Elmerraji, CMT, is a senior market analyst at Agora Financial in Baltimore and a contributor to

TheStreet. Before that, he managed a portfolio of stocks for an investment advisory returned 15% in 2008. He has been featured in Forbes , Investor's Business Daily, and on CNBC.com. Jonas holds a degree in financial economics from UMBC and the Chartered Market Technician designation.

Follow Jonas on Twitter @JonasElmerraji

Herbalife: Ackman Says He Will ‘Expose Incredible Fraud,’ Jim Cramer Tweets Ackman Has Decided

Shares of Herbalife (HLF) have tumbled after hedge-fund manager William Ackman said he would present evidence of fraud at the nutritional supplement company. CNBC has the details (and the video of Ackman’s comments):

Reuters

Bill Ackman, head of hedge fund Pershing Square Capital Management, said his firm’s presentation of a Herbalife investigation will “expose incredible fraud.”

“We have hundreds of hours of internal video, Ackman told CNBC’s Halftime Report. “We have some internal documents that were given to us by some employees.”

“This will be the most important presentation that I have made in my career,” he said. “We won’t disappoint.”

None other than Jim Cramer Tweeted: “I reiterate, Ackman has decided to put $HLF out of business so he will. It is not that hard to do that if you have a ton of money.”

Shares of Herbalife have dropped 11% to $54.08 at 3:30 p.m. while Nu Skin (NUS) has fallen 2.4% to $60.91 and Usana Health Services (USNA) has declined 7% to $67.75.

American Apparel is Over the Hump(s); Now It's All About Timing (APP)

Two weeks ago, yours truly penned some bullish thoughts on American Apparel Inc. (NYSEMKT:APP). Although the stock was in an "almost" situation at the time, APP shrugged off the "almost" condition the very next day and confirmed its bullishness. It's possible even that bullish feat wasn't convincing, but after yesterday' and today's action, it's going to be impossible to decide American Apparel still isn't over the hump.

Just as a refresher, as of the 26th (see the blue arrow), APP had already completed a strong inside day reversal pattern, and was working on logging a good follow-through day. The only thing we really needed to see at the time to put the finishing touches the budding breakout from American Apparel at the time was a break above $0.78. Well, we got it the next day... in spades. Blasting past $0.78, the stock went on to clear the 200-day moving average line (at $0.93) with that day's 32% leap.

It was, of course, too much and too fast, and sure enough, APP peeled back the very next day and wouldn't be able to move back above the 200-day line for a week and a half. Still, a major milestone had been passed, and the stock was still in the hunt for another milestone moment....

....which came yesterday, with the second (and more sustainable) push above the 200-day moving average line.

The move was underscored - admittedly too much - with today's bullish gap and 5% gain (as of the latest look anyway). That gap and the oversized gain are likely to pull American Apparel Inc. shares back to less alarming levels soon, but not low enough to snap the uptrend. Once the gap is closed and as long as the 200-day line holds up as a floor, this entire breakout process can be taken at face value and APP can be bought. Just shop around to make sure it's being bought at a short-term low.

The weekly chart of American Apparel offers some perspective on just how much upside may be in store here. The stock was trading around $2.00 when a wave of turmoil hit last August. The company's arguably in a more encouraging condition now than it was then, so it wouldn't be a stretch to see a push back to that area.

For more trading ideas and insights like these, be sure to sign up for the free SmallCap Network newsletter. You'll get stock picks, market calls, and more, every day. Here's what you've missed recently.

IBM Earnings Preview: 3 Clues to Watch for in Thursday’s Report

Popular Posts: 3 Biotech Stocks That Belong in Your PortfolioDrones – How to Cash In on Drone Stocks5 Battered Dividend Stocks to Buy Now Recent Posts: IBM Earnings Preview: 3 Clues to Watch for in Thursday's Report 3 Biotech Stocks That Belong in Your Portfolio 3 Takeaways from Amazon's Bid to Begin U.S. Drone Tests View All Posts IBM Earnings Preview: 3 Clues to Watch for in Thursday's Report

Against the backdrop of declining hardware sales and intense competition, Wall Street will have a watchful eye on International Business Machines (IBM) this week as the tech giant prepares to release its second quarter earnings Thursday. Expect mixed results from IBM earnings: continued (and perhaps steeper) declines in traditional hardware sales, but progress in its transition to next-generation IT capabilities like cloud computing, Big Data analytics and cognitive computing.

IBM earnings in the first quarter were $2.4 billion ($2.54 per share) on revenue of $22.5 billion — down markedly from the same quarter last year. Hardware sales dropped a whopping 23% — expected given the overall slowdown in lower-end servers used in datacenters. Emerging market sales declined significantly as well. Big Blue also took an $870 million hit on severance for workers that were laid off as part of the company's strategic realignment.

For investors, here are three clues to watch for in Thursday's second-quarter earnings release:

Hardware Sales On the Decline

Don't be surprised to see that IBM's hardware sales continued to slump in the second quarter. The hardware empire IBM built on servers is crumbling as next-generation cloud infrastructure, platforms and applications supplant Big Blue's legacy business. In a way, that's good news for IBM stock: It focuses the IT giant on high-margin software and services businesses, as well as R&D for next generation technologies and applications.

Earlier this year, IBM cut a deal to sell its low-end server business to China-based Lenovo for $2.3 billion, although the U.S. government reportedly has raised security concerns about the deal, CRN reports. China already has approved the sale, and while the U.S. security concerns may delay the deal, the sale still should close later this year.

Cloud is the Silver Lining — So Are Chips

The task of reinventing Big Blue is a tough one, but Chairman and CEO Ginni Rometty, who took the helm in January 2012, has tackled it aggressively. Rometty and her team must transform a 103-year-old tech giant into an agile innovator that can wipe out the lead that companies like Amazon (AMZN), Yahoo (YHOO), Google (GOOG) and Intel (INTC) have established in some of the highest-growth IT business lines like cloud, Big Data and business analytics. Instead of waging a price war with AMZN, GOOG and others on cheap clouds, IBM is using the cloud to distribute high-margin, enterprise-class applications.

IBM is on the right track: Advanced capabilities like cloud, Big Data analytics, mobility and security will be the growth engine for IBM stock in the foreseeable future. Last week's news that IBM will sink $3 billion into developing a new generation of computer chips demonstrates Big Blue's commitment to support increasing workloads — particularly because enterprise applications are doubling nearly every year.

And there’s another futuristic silver lining for IBM…

Elementary, My Dear Watson

Perhaps the most exciting news from IBM this year was the launch of the Watson Group, a new unit focused on developing new artificial intelligence or “cognitive” apps that are delivered via the cloud. This is where the rubber meets the road for Big Blue’s future growth: These high-end software, services and apps think, improve by learning, and deliver answers to complex questions, IBM said when it announced the plan in January. IBM will invest more than $1 billion on R&D for the Watson Group and has made $100 million available for venture investments to support its Watson Developers Cloud.

Watson, named after IBM founder Thomas Watson — not Sherlock Holmes' sidekick — is best known for beating champions of the trivia show Jeopardy in 2011. But Watson's value proposition is no game — IBM is leveraging the power of cognitive technology to bring scores of new, cloud and Big Data analytics applications to market — creating a new ecosystem that will churn out future profits as its legacy hardware business fades.

Bottom Line

I expect IBM earnings to continue to be slow for the second quarter. While earnings should remain steady, I do expect continued erosion on revenue, largely because of declining hardware sales. But if you're looking for a blue-chip tech stock to tuck away in your portfolio, IBM stock is worth your consideration. Big Blue's strategic shift away from traditional IT hardware toward high-value cloud and Big Data apps is a powerful value proposition.

IBM stock has a forward P/E of 9.6, which is comparatively cheap in the sector; the 2.4% current dividend yield further sweetens the pot. Although Big Blue has significant challenges as it reinvents itself, the company has been doing a lot of things right lately. There will be bumps in the road — and a couple of potential potholes if the Lenovo deal falls through and if emerging markets sag — but IBM stock looks attractive to buy and hold now, particularly if there is a post-earnings pull back in the stock.

As of this writing, Susan J. Aluise did not hold a position in any of the aforementioned securities.

Are We Running Out of Oil?

For many years, a number of industry experts have been sounding the alarm that America, and the world, are about to run out of oil.

This is nothing new. In 1914, the Bureau of Mines said that U.S. oil reserves would be exhausted by 1924. The Interior Department said global reserves would last 13 years... and that was in 1939. In 1956, Shell Oil geoscientist Marion King Hubbert advanced his peak oil theory, which said that world oil production had peaked and would begin to decline until all of the oil was gone.

Every expert who's predicted "the end of oil" has been wrong in the past. But with global energy consumption at an all-time high, and much of the world's economy dependent on oil, the question needs to be asked:

Are we running out of oil?...

The Peak Oil Theory

Hubbert (shown at left), whose distinguished career also included stints as a senior research geophysicist for the United States Geological Survey and professorships at Stanford University and UC Berkeley, believed that oil production looked like a bell curve.

Just as the production from an individual oil well will peak and then decline, so, he theorized, would global oil production. He called his bell curve "peak oil" - global oil production had peaked in the 1950s, he stated, and would begin a slow, but inevitable, decline to zero.

Most readers of Oil & Energy Investor know that I don't subscribe to the peak oil position. Hubbert argued that we were running out of crude oil and would be moving to bicycles in short order.

Let me explain why I disagree.

Now don't get me wrong, oil is a diminishing commodity. It has taken millions of years to provide what we are taking out of the ground. Aside from the occasional algae or biofuel farm, you can't just grow an oil alternative in a matter of weeks.

Even if we could, current technology can't provide more than a fraction of what would be needed if oil disappeared.

Yet that "disappearance" isn't going to take place anytime even remotely soon.

Granted, 10 years ago I might have been more sympathetic to the Chicken Little ("The sky is falling") approach when it came to the amount of crude oil remaining. In those days, I did say (and wrote) that we had about enough oil to possibly last one more generation.

But what I saw as the real issue back then was not the amount of oil remaining, but the reliability of the supply. I foresaw unpredictable disruptions, spot shortages, and a lot of uncertainty in the market.

One factor changed all of that.

Technology Changes Everything

The new "800-pound gorilla in the room" has been the arrival of formerly unconventional oil supplies, such as tight and shale oil. We're now able to extract huge amounts of oil from shale formations, a technology the late Hubbert never saw coming.

That oil is seemingly almost everywhere. According to the U.S. Energy Information Administration (EIA), 86% of those "new oil" reserves are located someplace in the world other than North America.

That translates into a broader availability of oil than we could have possibly foreseen a decade ago.

The problem now, as I see it, is not an outright decline in supply. Today, the stumbling block is the ability to meet the current spurt in demand.

Once again, I'm not saying that demand will be outstripping supply. I'm not saying there's an imminent worldwide conflict over remaining resources.

Look, there's plenty of oil to go around. It's just that from now until the first quarter of 2015 (or thereabouts), the global market will have trouble maintaining a balance between the available oil and specific regional needs.

This is what I call a supply constriction.

In other words, there's enough oil, but it isn't always going to be where it's needed in a timely fashion.

The ability to move new oil from where it's produced now (North America, primarily) to where the demand is growing quickest (developing areas, especially Asia) will be difficult in the short term.

The United States, for example, recently started lifting the ban on crude oil exports, but ramping up exports will take some time. Canada, on the other hand, is eager to export more oil, especially to Asia, but it needs new major pipeline spurs to the Pacific coast before that can happen.

Meanwhile, global demand is accelerating much quicker than anticipated, racing past just about everybody's earlier estimates (including mine). In a somewhat rare show of consensus, OPEC, the International Energy Agency (IEA) in Paris, and the EIA are all projecting daily crude demand internationally at more than 91 million barrels a day by the end of this year.

That's the highest total on record, and 4.5% more than the end of last year.

However, I believe that figure is a temporary spike, and not a "new normal." That's because the spike will translate into some hefty price increases in certain regions of the world, a quick way to put the brakes on continuing increases in consumption.

Unfortunately, unlike past periods, such a play between supply and demand will not end in a nice, neat Economics 101 fashion. I predict that price swings will be more rapid. The result will be greater overall instability in supply availability and pricing among regions.

You and I, at least, can usually drive past a number of gas stations looking for the best price. Countries and regions, especially those desperate for oil, don't have that same flexibility. In many parts of the world, oil transportation - such as pipelines, seaports, and railways - constrains oil sources and supplies.

You see, it used to be that the old adage of price encouraging or discouraging additional production would be sufficient to provide market equilibrium. At one time, the market price level was equivalent to the actual relationship between how much oil was available and who was prepared to buy it at what price.

No more. With the advent of "paper" barrels (futures contracts) now outnumbering "wet" barrels (actual oozing oil for sale) by 10 or 20 times, market traders' expectations now determine the price. When those expectations meet regions that are being challenged to quickly find additional supply to meet growing demand, market volatility just increases.

What Really Affects Crude Oil Prices

In other words, speculators, not supply and demand, are driving crude oil prices (and ultimately the price you pay at the pump).

Having said that, it's important to understand that temporary supply constrictions can remain localized and still have a broader impact. They also only have to occur intermittently to create problems.

The market hates uncertainty.

This is the situation that's developing around the world. If you only look at annual, quarterly, or even monthly figures of supply and demand, global energy supplies and consumption may appear to be in sync. But in reality, the market is experiencing a considerable amount of instability.

Determining the genuine impact of oil constriction on investments is difficult. In fact, it poses the same difficulties as volatility indices do when looking at the stock or bond market in general.

For example, many investors just glance at the VIX, which is the index used to measure market volatility. If the VIX number is low, most investors would conclude that market volatility is under control.

But this simplistic measurement is inaccurate, sometimes wildly so, if volatility is occurring rapidly. You see, the VIX is based on a 30-day cycle. Wide, rapid fluctuations won't be "weighted" as they should, making the market, or in this case the oil supply and demand equation, look much more stable than it is.

Think of this as throwing pebbles into a calm pond. Throw one pebble at a time and it's easy to measure the resulting ripple and judge its impact. But throw a handful of pebbles into a pond at different intervals and assessing the actual size and vectors of the resulting ripples gets tricky.

Right now, supply constriction is the issue moving the oil market, not oil shortages. And that makes estimating the actual situation more difficult.

The world isn't running out of oil. But at any given moment some country or region is almost certainly facing spot shortages or price spikes.

But you don't have to swap your car or truck for a bicycle just yet.

More from Dr. Kent Moors: After more than four decades, America is getting back into the oil export business again. And the end of the U.S. oil export ban is going to be a windfall for these companies...

'Game of Thrones' Boosts Ex-Communist Country's Economy

Elvis Barukcic, AFP/Getty ImagesTourists take a guided tour of medieval defense walls surrounding the historical city of Dubrovnik, Croatia. ZAGREB, Croatia -- The wildly popular "Game of Thrones" TV series has spurred tourists' interest in visiting Croatia, where much of the epic TV fantasy is set. But it could also help re-establish Croatia's reputation from Yugoslav days as a location for film making. "Thanks to 'Game of Thrones,' many people are coming to visit the very old walls in Dubrovnik and Split," Croatia's deputy tourism minister, Ratomir Ivicic told CNBC. "Season five will be made in Sibenik -- also a very beautiful place in Croatia." "Game of Thrones" grew its audience 24 percent last season, delivering viewer tallies on a par with the final episodes of hit series "The Sopranos." Filmed in different spots across Europe, "Game of Thrones" has inspired interest in places like Dubrovnik, an ancient Croat port city and UNESCO World Heritage Site used to represent King's Landing. Special "Game of Thrones" tours are now available in both Dubrovnik and Split for those want to relive the show. 'Winds of War' Several internationally renowned television programs and movies were shot in Croatia during the Yugoslav era. These included television miniseries "Winds of war" and "The pope must die," a comedy film starring Robbie Coltrane that was filmed just before the Croat Independence War erupted in 1991. While some film makers headed to the Yugoslav capital of Belgrade, most chose Croatia, the Republic's filming hub. The city of Zagreb appealed because its typically central European appearance meant it could pass for Vienna -- a more expensive place to shoot -- or Prague, which was cheap but trapped behind the Iron Curtain. Zagreb's large film studio remains to this day, but the carnage of the 1990s brought the industry to near-collapse. While some non-war-related filming continued in Zagreb, which was away from the frontline, most camera crews visited only to capture the violence. Croatia's film sector has yet to fully recover 20 years on, but has the chance to use the success of "Game of Thrones" to attract directors back. Local business leader Ivica Mudrinic was sanguine about Croatia's prospects of building on the attention.

Baidu: This Search Giant Is a Worthy Investment

Leading Chinese search provider Baidu (BIDU) released strong first-quarter results. The company came up with fantastic financials, exceeding its own outlook. Baidu's core search business was performing well, driving the company's growth. Moreover, Baidu is confident of a better performance in the future, as the company is counting on the fast growing mobile segment. On the back of many key factors, Baidu can be a good long-term holding.

Strong financials

Baidu's financials were strong. Its quarterly revenue reported an impressive 59% growth as compared to last year's same quarter. Baidu also saw a good 8.8% growth in online marketing customers, which led the company to post a good 24% increase in net profit. On the earnings front, Baidu posted $1.23 per share, which outpaced consensus estimates of $1.04 per share.

Baidu is a famous name in China's internet industry. It has aggressive strategies to grow faster and move ahead of peers -- Alibaba Group and Tencent. Both these competitors are making impressive moves to capture untapped opportunities in the growing e-commerce business. To hold its ground, Baidu is investing in its core business as it transitions to mobile devices such as smartphones from PC search advertising.

Baidu is expanding its operations on the international front as well. Looking at its performance in the past, the promises look concrete. Baidu is laser-focused on mobile, cloud-based services, and customer products. These segments are expected to generate strong income, and give enormous opportunity to Baidu to tap markets in future. Baidu is stretching its foot print to different sectors such as media, retail, and travel, along with financial and local services that should generate strong margins for the company.

Growth ahead

Further, Baidu has its eyes on the growing mobile segment. The changing customer preferences from feature phones to smartphones is a great opportunity for many companies, and Baidu is also lining up to benefit from it. Seeing this, Baidu is taking steps to expand its operations in segments such as media, social, online tools to deliver world class services. According to some sources, internet users logging in from mobile devices have increased over time, and Baidu is looking to maximize its profit and improve its market share as a result.

Recent studies have revealed that internet mobile search is increasing day by day. The statistics show that the number of active users have increased from 130 million to 160 million in two quarters. Seeing this, Baidu wants to capture these growing opportunities. It is making moves to strengthen its channel distribution through a number of initiatives, such as optimizing ad formats on the search page, making click-to-call, click-to-download buttons, as well as location extensions on the product side. Such moves by the company will help it generate healthy returns in the future.

Moving forward, Baidu has added the Plus V verification program on the safety front, which is an attractive feature which will attract more users. Also, with this feature, users will be able to advertise on the search page, which will be accretive to its revenue as the company expects solid growth in its customer base with this system in place.

Conclusion

Looking at the ratios, Baidu is quite undervalued with a forward P/E of just 3.61. Baidu is continually reporting solid results which indicate that the company is moving forward. Also, its core fundamentals are strong, indicating that Baidu looks set to get better in the future.

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Biggest Retirement Income Gap Seen for Oldest Pre-Retirees

Older pre-retirees are furthest from being retirement-ready, according to a recent analysis  by BlackRock and the Employee Benefit Research Institute.

The younger the retiree, though, the better it looks.

According to the study, 55-year-olds with median income and retirement savings are on track to replace 69% of their pre-retirement income. Based on the idea that retirees will need to replace about 80% of their income in retirement in order to maintain their standard of living, these 55-year-old median workers are falling 14% short.

For older pre-retirees, the gap gets wider.

The study found that 64-year-olds with median income and retirement savings will be able to replace only about 59% of their income, less than 60-year-olds who have the potential to replace about 64%.

“U.S. workers closest to retirement, and with the least amount of time left to bulk up their savings, are the ones who have the most work to do,” wrote Chip Castille, head of BlackRock’s U.S. Retirement Group, on BlackRock's blog.

BlackRock focused on people in their last decade before the traditional retirement age of 65 that have the two primary sources of retirement income, Social Security and retirement savings, usually 401(k) plans and individual retirement accounts.

“The 26% gap that the median 64-year-old faces to replace 80% of pre-retirement income is more daunting,” wrote Castille. “And for workers who expect to make up at least some of the difference by staying on the job past age 65, it’s important to note that EBRI’s 2014 Retirement Confidence Survey has found that 49% of retirees left their jobs earlier than they had planned.”

Castille added one explanation for the larger gap for older pre-retirees is “workers in their 60s are far more likely to receive some sort of traditional pension to supplement their retirement.”

To assess the retirement readiness of pre-retirees, BlackRock used its CoRI Retirement Indexes and incorporated data on U.S. workers’ median income and retirement savings provided by the Employee Benefit Research Institute.

To estimate the Social Security retirement benefits at the “full retirement age,” BlackRock collected the median retirement savings balances of people the same ages who have 401(k) accounts and IRAs in EBRI’s database and used the BlackRock CoRIRetirement Indexes to estimate the retirement income that those savings could provide.

Launched last year, the CoRI Retirement Index series was developed to help investors age 55 and older plan for retirement by tracking the estimated cost of $1 of future, annual inflation-adjusted lifetime income beginning at age 65.

The analysis also found that the cost of future income for investors ages 55, 60 and 64 has risen since BlackRock began tracking the cost of future retirement income a year ago.

“For someone age 55, for example, every $1 of lifetime retirement income was estimated to cost $14.09 as of June 30 – a 7.15% increase from what that same income would have cost a 55-year-old a year ago,” the study said.

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Now Is the Perfect Time to Buy Refining Stocks

Popular Posts: 5 Oil Services Stocks to Play Rising SpendingBe Wary of These 3 New MLP ETFs3 Healthcare Stocks for Retirement Investors Recent Posts: Now Is the Perfect Time to Buy Refining Stocks Is the Sun Fading on ETFs? – Morning Linkfest (July 7) Happy Birthday, 'Murica … And New Stocks – Morning Linkfest (July 3) View All Posts Now Is the Perfect Time to Buy Refining Stocks

Sometimes, markets overreact to news.

In this case, we're talking about the recent landmark decision by the Obama administration to begin the early stages of exporting our crude oil bounty overseas.

The news was heralded by various energy firms — especially those in the Bakken and Eagle Ford producing regions of country. After all, those exports should help West Texas Intermediate (WTI) benchmarked crude increase in price and trade closer to international benchmark Brent. That means some hefty profits for those firms drilling within our borders.

Sadly, that's not necessarily a great thing if you operate a refiner and use WTI as a cheap feedstock for your gasoline, jet fuel and other products. As such, shares of leading refining stocks like Valero (VLO) and Marathon (MPC) fell hard on the news.

Perhaps too hard.

For investors looking for a beaten-down value in the energy sector, downstream players could be one of the best bets at current fire-sale prices.

Exporting Condensate

Last week, the Obama Administration and the Commerce Department paved the way for U.S. oil exports. In a landmark decision, government officials gave Pioneer Natural Resources (PXD) the go-ahead to begin exporting a type of light oil known as condensate. The byproduct of natural gas drilling, condensate is considered a type of oil and is actually a mixture of various hydrocarbons, including everything from more traditional natural gas liquids (NGLs) to ingredients resembling gasoline or "drip gas." A big and growing use is mixing it will heavy oil sands-style oil in order for it to be shipped through pipelines.

That makes it a very useful and profitable product for energy firms. And we're producing a ton of it now, thanks in part to fracking.

The key for PXD and partner Enterprise Product Partners (EPD) is that, according to the Commence Department, condensate fits the bill as a "refined" product for export. That's because it needs to go through a series of stabilizers during the gathering process in order to be used. Even though that process is really just one or two steps, it still makes condensate a "refined" product and eligible for export under current rules.

Several analysts has postulated that this is just the first step to lifting the 40-year ban on exporting straight crude oil exports. And that's bad news if you rely on cheap mid-continent crude as your main profit driver. So it's no wonder why shares of the refining stocks plunged on the news. VLO dipped 8.3%, MPC dropped 6.3% and PBF Energy (PBF) plunged by 11%.

A Big Overreaction in Refining Stocks

The concern is rightfully there. After all, the sheer glut of crude oil here in America is allowing refining stocks to realize insane profits on their crack spread margins. So some drop is certainly warranted. But an 8%-plus plunge? I'm not so sure.

Here’s why that’s unwarranted …

First, this is condensate we are talking about. No one ever said anything about raw crude oil. In fact, the Commerce Department basically stated that there had been “no change in policy” toward crude oil exports. Exporting crude oil has become this year's hot-button issue, and the debate around it resembles the vitriol surrounding TransCanada's (TRP) Keystone XL pipeline. That pipeline is still bogged down in regulatory muck. I suspect that raw crude oil exports will mostly face the same fate.

Those exports — if they happen at all — will most likely resemble what is going on in the natural gas and LNG sectors. Controlled facility approvals, export quotas and the like are the norm for the LNG producers. Only a slight handful of facilities have been given the green light to begin exporting to nations with trade agreements with the U.S. (and those that do not share such deals are even fewer in number).

In the meantime, we're still producing ton of crude oil that remains locked within the United States borders. The WTI/Brent spread should remain favorable for quite a while. Nothing about the current condensate export deal will crimp margins or profits today for the refining stocks. In fact, they might actually get bigger.

As we said before, one of the main uses for condensate is thinning out heavy oil, like the kind Canada is blessed with. West Canadian Select (WSC) crude oil trades for even cheaper prices that WTI or Brent. I'm sure the refiners would love to get their hands on more of this cheap oil. Sending condensate upwards would make that possible.

Let's not forget that many of the refiners are now becoming petrochemical powerhouses that have been getting into processing some of these light oils/NGLs. Add in the fact that many of them own export terminals for gasoline that could easily add capacity for shipping condensate and you can see how the market has basically panicked over nothing.

Time To Buy Refiners

Essentially, the market is extrapolating a lot of "what if" from the recent decision to export condensate. For opportunistic investors, that provides plenty of chances for them to potentially add some of the top refiners to the portfolios on the cheap.

The drop in refining stocks has sent price-to-earnings ratios down to historic lows and dividend yields to new highs. Valero trades for a P/E of just 10 and with a 1.7% dividend yield, while Phillips 66 (PSX) and Western Refining (WNR) both trade at just 13 times earnings along with a 2.5% payout. All feature growing profits, vast product lines and MLP subsidiaries providing hefty tax-deferred payouts.

And those are just some of the candidates for inclusion. The bottom line is that market has overreacted to a bit of news that really has zero implications on today or the near future. Investors looking to shift through the noise are able to snag some deals in the downstream players.

As of this writing, Aaron Levitt was long MPC.

Google at center of Europe censorship storm

Google has received more than 70,000 requests from individuals who want articles removed from its European search results. LONDON (CNNMoney) Google has started deleting some news articles in Europe to comply with a recent court ruling, sparking criticism that it is restricting freedom of speech.

Google (GOOG) has told the BBC, The Guardian and The Independent that it is removing some articles from its European search results in response to requests from individuals looking to make use of a 'right to be forgotten' ruling by the European Court of Justice.

Search engine users can now ask for results that include their name to be removed where they are "inadequate, irrelevant or no longer relevant."

Google, which called the ruling "disappointing," has received over 70,000 such requests. It now has to weigh them against the public interest in information relating to crime, misconduct or malpractice.

"This is a new and evolving process for us," said a Google spokesperson. "We'll continue to listen to feedback and will also work with data protection authorities and others as we comply with the ruling."

The company is clearly wrestling with the challenge of acting as judge and jury in cases that could have big implications for personal privacy and censorship.

A critical BBC blog about Stan O'Neal, the former head of Merrill Lynch, was removed despite vocal protests from the journalist who wrote the piece.

Search results for 'Stan O'Neal' in Europe now include a note from Google saying, "Some results may have been removed under data protection law in Europe."

Free speech campaigners say the ruling has created confusion and placed far too much power in the hands of the search engines.

"There's no appeal mechanism, no transparency about how Google and others arrive at decisions about what to remove or not, and very little clarity on what classifies as 'relevant'," wrote Jodie Ginsberg, CEO of Index on Censorship.

  Check out Google's new Android L

Google says it will assess each request and attempt to balance the privacy of the individual with "the public's right to know and distribute information."

It has created a form for people to submit requests. A committee including chairman Eric Schmidt and the company's chief legal officer may review the most sensitive requests.

The first few cases have generated such a storm of publicity that the individuals may now be regretting asking for the articles to be taken down, not least because they're still easily found on domains outside Europe, such as google.com.

Campaigners say the big search engines could take a stand against the ruling by insisting that national data protection authorities decide on the requests.

"The flood of requests that would be driven to these ... organizations might help to focus minds on how to prevent a ruling intended to protect personal privacy from becoming a blanket invitation to censorship," said Ginsberg.

The Latest From Bill Gross - One Big Idea?

Investing and business success can often depend on one BIG idea and its timing. The peaking of short-term interest rates at 20% in the early 1980s and the bursting of the DotCom and NASDAQ bubble 20 years later were excellent examples of big ideas that made or broke investment portfolios. A similar tale was told by the late Peter Bernstein as he recalled his early career in the 1950s when investing for income was rapidly becoming old hat, appropriate perhaps for widows and orphans, but not for red-blooded business executives focusing on a new era of growth. He writes that one client told him, "Please remember, I just can't stand more income." Back then, Bernstein suggests, income was for "sissies."

In 2014, the tide may be turning again as demographics, fear of another Lehman, or just income-starved insurance companies and similarly structured liability-influenced institutions, reach for anything they can get. The era of income may be, at the margin, replacing the era of capital gains, despite artificially low current yields.

If so, the proper analysis of where to find high, yet relatively safe, income should be one of the top priorities of any investment management company. In addition to bottom-up credit analysis, the timing and ultimate destination of PIMCO's New Neutral short-term interest rate thesis will be critical.

For example, if The New Neutral real FF (federal funds) rate is 0% instead of the Fed's currently presumed 1¾%, then not only bonds but all financial assets might logically be repriced relative to historical experience. Even after accepting the historical validity and predictive capability of Robert Shiller's CAPE (10-year cyclically adjusted P/E ratio), it may be necessary to make adjustments to it, if in fact real policy interest rates over the long term have settled into a lower New Neutral. At PIMCO, we are amazed that little outside analysis has been applied to this concept that to us affects the array of financial assets available to investors. One has only to apply Gordon's dividend discount model to measure the potential effect that a 0% real policy rate would have on stock prices versus the presumed 1¾ - 2% of an "old normal." P = D/R-G, states the Gordon model, with R in this case being the real rate of interest that may be substantially lower than prior levels. Ex-Fed Chairman Ben Bernanke has argued in private conversations that R is lower because G (growth) will be equally lower in future years. We agree, but would add that in a highly levered world, R has been and must remain reduced more than G in order to keep our financed-based economy functioning. If we are correct, Shiller's CAPE may have to be adjusted from an historical median 17x P/E to something resembling 20-22x. That would not mean that today's 16-multiple P/E market should be elevated to an immediate 20x, but that the current CAPE of 25x, as shown in Chart 1, is less bubbly than presumed. Fed officials who cite bubbly aspects of "financial conditions" should therefore be less alarmed. If the real New Neutral is significantly lower than 10 or 20 years ago, P/E ratios should be higher, credit spreads should be tighter, and home prices less bubbly than presumed if, in fact, The New Neutral is "neutral" and can lead to historical levels of asset volatility. The New Neutral is critical to future investment ! success. This currently is PIMCO's "one big idea."

The following is an excerpt from a recent speech given at the Morningstar Investor Conference in Chicago that more fully explains our logic concerning this New Neutral concept:

The New Neutral is simply the 'biggest, most critical, most significant, most important' element in asset pricing today. The policy rate, along with forward expectations, as well as volatility, corporate and equity risk premiums, has always provided the fundamental foundation for asset prices, aside (that is) from the inevitable bouts of exuberance and fear. But the neutral policy rate – in real and certainly nominal terms, changes over time. Irving Fisher back in the 1930s came up with the concept of a neutral policy rate, but he surmised it would change only with inflation. In other words, the real rate would be constant. History has proved otherwise. In the nearly 80 years since his theory was introduced, real policy rates have fluctuated from 0% to 8% during periods of positive inflation, and importantly, asset prices – bonds and stocks – have been significantly influenced by them. Do you wonder why stocks sold at P/Es of 6-7 times in 1981? Wonder no longer. It's because nominal FF traded at 20%, and real FF at 7% or 8%. Equity risk premiums had to go up because real FF went up, which sent P/Es to what were rock bottom prices. Same thing with long Treasuries at 15%. It's not that the market expected real funds to trade at 7-8% forever. But the forward path was exceedingly high, higher than Fisher could ever have imagined. For the next 30 years it came down, down, down and finally over the past few years real FF have been negative. 25 basis points nominal with 1.5% inflation has equaled a minus (1.25%) average real FF rate for much of the period.

So the real policy rate changes, and as Janet Yellen has recently agreed, there is an evolving neutral policy rate – a Goldilocks rate, which is "not too hot or not too cold, but just right" to promote Fed targets of 2% inflation and 3% real growth, which is nominal GDP of 5%. I might add, this neutral policy rate will now be expected to maintain moderate financial conditions and keep exuberance contained, an evolving third leg to Federal Reserve policy.

What is this real policy rate and is it really different than what we've seen for the past 25 years? Well, it's likely not the current negative (1.25%), although that rate plus 1 trillion dollars of QE per year has been insufficient to generate 5% nominal GDP. What it has generated are what appear to some observers to be bubbly asset markets, and so perhaps they presume it must be raised to prevent popping. It will be, but by how much is the question. Nor, however, is the real rate likely to be 2% positive as markets experienced pre-Lehman. That was the rate embedded in the Taylor rule, formulated in the early '90s which worked quite well, until it didn't, namely 2006–2007 when we had a real rate too high for a levered economy that it became the precursor to the Great Recession. The 2% Taylor real rate was a rate consistent with a significantly less levered financial economy than we have today. To return to a 2% real policy rate today would be to dice with another Lehman-like disaster. The real rate was only 1% at its peak before the financial system came tumbling down. It is almost comical to believe we can return to that point with our economy now levered 350% to GDP, much like it was five years ago. Although there is limited research beyond the Taylor Rule in this area, a 2001 San Francisco Fed Study by Laubach and Williams, which has been updated quarterly since, comes closest to the mark in my opinion. It suggests that The New Neutral should currently be a minus (25) basis points real, which would cap nominal FF at 1¾% if the Fed's target of 2% inflation were to be reached. Other historical research by Rogoff & Reinhart covering the aftermath of the Great Depression and the 35 years-plus recovery into the 1970s, suggests real policy rates averaged a minus (25) to minus (100) basis points in the U.S. and the U.K. during this period. Deleveraging takes time and it takes very low real yields as well, it seems, to return an economy to Old Normal. It will likely take at least 5-10 mor! e years before we approach the old Taylor model of 2% real, if then.

O.K., hopefully I haven't put you to sleep. My point is that if The New Neutral is closer to 0% real than the Taylor 2% which many expect, then all asset markets, which are priced off of it, are less bubbly than they appear at the moment. P/Es of 16-17x seem reasonable with a 0% real policy rate. 10-year Treasuries at 2.60% do as well once a term premium is added to 2% inflation. Credit spreads themselves, while almost historically narrow, may be using the wrong history book IF Taylor is their guide. At 0% real, high yield spreads of 350-400 basis points make more sense as do other alternative asset yields. Collectively of course, all of these asset prices depend on Janet Yellen's "not too hot, not too cold" assumption that produces at least 4% nominal GDP growth, but that of course is what Neutral means. Minsky and future Minsky moments have not been outlawed. It's just that PIMCO believes the New rate is closer to 0% than 2%. If it's closer to 2%, then bear markets in all asset classes await. We think not.

To PIMCO, this means that asset returns will be low, but less volatile than in prior periods. Perhaps that is why the VIX and Treasury volatility are so low currently. The market may be buying into PIMCO's view of a slow crawl to a New Neutral. Admittedly, on the other side of the argument, I haven't even discussed the levered global economy, China, Euroland, or other potential hot spots that might spark another flash crash and mass exodus. There is tail risk in a levered global economy both on the inflationary and the deflationary sides. We have been living with that risk for 5 years now and it will continue around the world, most visibly perhaps in Japan where deflation and inflation have suddenly come together like two giant galaxies that could produce a supernova inflationary explosion, or a deflationary black hole. We shall see – Japan perhaps will give us a glimpse into the global economy's future, as to whether you can solve a debt crisis with more debt, or at least negative real interest rate debt.

And, as we learned last week, as if we didn't know it before, each country has its own New Neutral policy rate that is not too hot / not too cold, but just right – and in our opinion lower than historic Neutrals because the world is now more highly levered. Mark Carney of the Bank of England will likely head the first of the G-7 countries to raise rates and explore where to stop at hopefully just the right spot. He will likely be the Christopher Columbus of G-7 central bankers, sailing upwards to find the East, and the wonderful spices of the U.K.'s New Neutral.

For now, however…investors must make choices, and simultaneously with this journey to The New Neutral, investors must be aware that QE, in the U.S. at least, will disappear as a policy choice in early November, and risk markets, including long-term Treasury bonds have feasted on that policy for 5 years now. What will happen when the Fed stops buying nearly 100% of all 30 year Treasuries being issued by their puppet counterparts – the U.S. Treasury? Talk about the left hand and the right hand – these days the Fed and the Treasury are nearly one and the same – one giant marionette. And that marionette, according to some (which includes PIMCO), has significantly fertilized risk assets including stocks. Is it a coincidence that stocks have doubled during the period of Quantitative Easing, while the Fed has injected 3.5 trillion dollars of checks into the credit markets? What will happen when the checks stop? We think, at the margin at least, that stock market appreciation will slow significantly and that credit spreads will stop tightening. And we assume that is what the Fed is hoping for too. But no bear markets if The New Neutral is closer to 0% than 2%.

But to the point – if The New Neutral is closer to 0% than 2% – if Taylor is replaced by PIMCO's New Neutral – then risk assets, even without QE checks, can stand on their own two legs. They won't be stilts, more like peg-legs in a historical context, but stable nonetheless. We expect bonds to return 3-4% over the next 5 years and stocks perhaps 4-5%. If central banks proceed cautiously, there's no need for another Lehman Brothers, but as well, there will be no interest rate propellant for double-digit asset returns. Those days are gone. The journey to 0% nominal Fed Funds and a negative 1½% real rate is over. A 0% real Fed Funds New Neutral lies ahead, a tightening of credit yes, but a mild one to be sure.

And specifically what would PIMCO favor or recommend? Well, of the carry alternatives available to all investors we would favor credit and equity risk premiums (stocks) as well as volatility sales and the middle of the curve, as opposed to outright duration, although we would acknowledge, as I have, that the alpha heyday of all risk premiums is over. They are too tight to produce substantial capital gains, and their "carry" even when mildly levered lies in the 3-5% annual return range.

Big Idea Speed Read

1. The New Neutral is PIMCO's one big idea currently.

2. If it is lower than the historical 2% real, and if it facilitates normal asset volatility, then stocks, bonds, and risk assets in general should appear less bubbly than some presume.

William H. Gross Managing Director

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Currently 0.00/51 Thursday, July 3, 2014 Facebook still won't say 'sorry' for mind games experiment   Did Facebook study go too far? NEW YORK (CNNMoney) Facebook can't seem to bring itself to apologize for performing psychological experiments on its users. In her first public statement on the matter, Facebook Chief Operating Officer Sheryl Sandberg said that the outrage over the company's controversial study was all a big misunderstanding. "This was part of ongoing research companies do to test different products, and that was what it was. It was poorly communicated," said Sandberg at an Indian Chambers of Commerce event in New Delhi on Wednesday. "And for that communication we apologize. We never meant to upset you." Internet users were angry earlier this week when Facebook (FB, Tech30) revealed that it intentionally made a subset of its users less happy during a week in 2012. As part of the study, Facebook changed the mix in the News Feeds of almost 690,000 users. Some people were shown more positive posts, while others were shown more negative posts.   Facebook's controversial mood experiment In an interview with India's NDTV Wednesday, Sandberg reiterated that the company was sorry for the lack of transparency -- but not for the study itself. "We clearly communicated really badly about this, and that we really regret," Sandberg said. When pressed if Facebook plans on apologizing, Sandberg came closer to offering a mea-culpa, but still didn't quite get there. "Facebook has apologized, and certainly never wants to do anything that upsets users -- and particularly for communicating really badly." ! But has Facebook really apologized for conducting the mood manipulation study itself? Not quite. The Facebook researcher who designed the experiment, Adam D. I. Kramer, said in a post Sunday that he was sorry for the way the study was presented and for the uproar it caused. "I can tell you that our goal was never to upset anyone," Kramer wrote. "I can understand why some people have concerns about it, and my coauthors and I are very sorry for the way the paper described the research and any anxiety it caused. In hindsight, the research benefits of the paper may not have justified all of this anxiety." Facebook's official statement didn't come close to apologizing. In fact, the company defended the study as a way to "improve our services and to make the content people see on Facebook as relevant and engaging as possible." "We carefully consider what research we do and have a strong internal review process," a Facebook spokesman said in a statement. "There is no unnecessary collection of people's data in connection with these research initiatives and all data is stored securely." Facebook did not respond to a request for a comment on whether the company plans on apologizing for the study itself. Subscribe to: Posts ( Atom ) Blog Archive ►  2019 ( 37 ) ►  March ( 21 ) ►  February ( 16 ) ►  2018 ( 21 ) ►  August ( 1 ) ►  July ( 10 ) ►  June ( 2 ) ►  May ( 8 ) ►  2016 ( 1 ) ►  December ( 1 ) ►  2015 ( 83 ) ►  June ( 8 ) ►  May ( 11 ) ►  April ( 4 ) ►  March ( 12 ) ►  February ( 15 ) ►  January ( 33 ) ▼  2014 ( 314 ) ►  December ( 18 ) ►  November ( 5 ) ►  October ( 10 ) ►  September ( 13 ) ►  August ( 10 ) ▼  July ( 13 ) Car Buying Advice From Around the Web Hedge Funds Hate These 5 Stocks -- Should You? Herbalife: Ackman Says He Will ‘Expose Incredible ... American Apparel is Over the Hump(s); Now It's All... IBM Earnings Preview: 3 Clues to Watch for in Thur... Are We Running Out of Oil? 'Game of Thrones' Boosts Ex-Communist Country's Ec... Baidu: This Search Giant Is a Worthy Investment Biggest Retirement Income Gap Seen for Oldest Pre-... Now Is the Perfect Time to Buy Refining Stocks Google at center of Europe censorship storm The Latest From Bill Gross - One Big Idea? Facebook still won't say 'sorry' for mind games ex... ►  June ( 49 ) ►  May ( 46 ) ►  April ( 52 ) ►  March ( 43 ) ►  February ( 17 ) ►  January ( 38 ) ►  2013 ( 1390 ) ►  December ( 50 ) ►  November ( 51 ) ►  October ( 46 ) ►  September ( 30 ) ►  August ( 43 ) ►  July ( 110 ) ►  June ( 125 ) ►  May ( 134 ) ►  April ( 126 ) ►  March ( 284 ) ►  February ( 183 ) ►  January ( 208 ) ►  2012 ( 1639 ) ►  December ( 249 ) ►  November ( 206 ) ►  October ( 230 ) ►  September ( 183 ) ►  August ( 201 ) ►  July ( 225 ) ►  June ( 242 ) ►  May ( 103 ) About Me Stock Broker View my complete profile Powered by Blogger.