Global Recovery, Equities Disconnect, U.S. Jobs Report

Global Recovery, Equities Disconnect, U.S. Jobs Report

Global Recovery

I strongly suggest you take the time to read 'Will Developing Economies Help Sustain the Global Recovery?' - reading time 8 minutes - written by, or on behalf of, The Carnegie Endowment for International Peace.  The Carnegie Endowment is a private, nonprofit organization founded in 1910 "dedicated to advancing cooperation between nations and promoting active international engagement by the United States".  It currently is pioneering a 'Global Think Tank'.  The article discusses (1) growth in the emerging economies, (2) increased 'self-sustainment' of that growth, (3) what that means to 'advanced countries' growth, and (4) emerging markets stimulus.  I commented on this article this morning as follows:

The title of this article states what I consider to be a (but not the only) $64 (or should I say $64 trillion) question. My view: maybe, so long as the developing countries (read in particular China) U.S.$ holdings are not eroded by U.S. Administration 'printing presses', or the U.S.$'s purchasing power is somehow not otherwise eroded.

To me this is the rock and hard place the U.S. is in. Devalue the U.S.$ and it seems to me that has to harm the ongoing growth in developing countries - with potentially other ramifications related to those developing countries not being very happy with the U.S. at that point. Leave the U.S.$ where it is, and I think the current (or any future, irrespective of political party) U.S. Administration has nowhere to hide from U.S. accumulated and unaccrued debt and long-term liabilities.

Over the many years I operated my valuation consulting practice I turned many prospective clients at the door. I did this because if I couldn't see a way I could help them in a meaningful way. I didn't 'kid them' and 'take their fees'. That is not to say some (or perhaps many) of them couldn't be helped. I just wasn't smart enough to solve, or partially solve, their respective problems.

That said, if the U.S. Administration came to my 'consulting door' today I actually think that in theory (note the 'in theory') I could give them some constructive advice. However, as a practical matter I would be convinced that it (the U.S. Administration) either wouldn't (largely for reasons of re-election) or couldn't (largely for reasons having to do with political partisanship issues) act on that advice. In that circumstance I would politely suggest to the U.S. Administration, like I did with all other potential clients I thought I couldn't help, that they should find a consultant smarter than me.

Equities Disconnect?

I suggest an article titled 'Why Aren't Equities Selling Off More Significantly?' is a very good 'food for thought read' for anyone who invests or trades in equities - reading time 5 minutes.  I commented on this article this morning as follows:

Corporate value - and hence long-term equity prices - is a function of after-tax free cash flows (after-tax cash flow net of required sustaining capital expenditures) discounted to perpetuity. 'Perpetuity' is long-term, something I think the equity markets - which I see more as 'trading markets' than I see them as 'investing markets' - currently seem to be disregarding to a large degree. Near and long-term macro-economic conditions are a major influencer on the short and long-term after-tax free cash flows of most companies.

For these reasons I have seen a disconnect between the broad equity markets (with some resource sectors perhaps being the exception) for some time. I continue to see that disconnect, and for me it is 'widening' by the month.

In many ways my comment says the same thing as the article - or at least it does as I read the article.  My comment may be a little more to the point.  If you are interested in reading more about valuation theory you can visit the Home Page of StockResearchPortal.com, click 'E-learning' in the Main Navigation Line, there find three PDF's titled 'Dictionary of Valuation Terms', 'Valuation General', and 'Valuation Methodologies'.

August U.S. Jobs Report

The August U.S. Jobs Report was released 30 minutes ago.  As you have probably read elsewhere the private sector added 67,000 jobs, a number below that necessary to keep up with population growth.  Believe it or not, this was better than expected.  Overall, the U.S. August job losses were 54,000, as 114,000 temporary census jobs came to and end, and State and Municipal Governments terminated 10,000 workers.  The 'official' U.S. unemployment rate increased from 9.5% to 9.6%.  I see all these these numbers as immaterial in the context of U.S. economic recovery - and of course they may subsequently be amended.  The DJIA is up over 100 points this morning as I write this.  My wife is Danish.  Something, and I can assure you it is not my wife, 'is rotten in Denmark'.

Topically Segregated Press Releases - Today's Featured StockResearchPortal.com Data Component

Our proprietary 'Segregated Press Release System' sorts Company Press Releases into 18 different categories (e.g. 'Drilling and Discovery').  This feature is found on the right side of our website's Home Page.  These Segregated Press Release tables are updated throughout each trading day as we receive them from our data providers.  They then are retained in Segregated Press Release tables on each Company 'Data Page' in our website.  While these features are based on automated 'Keyword Searches' and accordingly may mis-categorize or fail to pick up some Press Releases, we believe traders ought to find our daily Home Page Press Release segregation particularly valuable.  We also believe both investors and traders ought to save valuable time by more efficiently reviewing segregated Press Releases on our Company 'Data Pages' than they otherwise can. We suggest you visit our Home Page and Company Pages and review these features.

Linkedin Mining and Oil & Gas Stocks Groups

Consider joining the Mining Stocks and Oil & Gas Stocks Groups on Linkedin by clicking on one or both of the following images.

                       

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Linkedin Investor Relations Executives Mining Group and Oil & Gas Groups

 

If you are an Employee of, or Investor Relations Consultant to, a Mining or Oil & Gas Company consider joining the applicable Linkedin Group by clicking on one of the following images.

                   
       
                    

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As always, please forward ideas to me as to how we can improve StockResearchPortal.com at info@stockresearchportal.com.

 

Best Regards,

Ian R. Campbell

President

StockResearchPortal.com

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