Seven Signs That J.C. Penney Company (JCP) Could Be the Next Comeback Kid?

Despite an earnings report showing a half billion dollar loss, troubled retailer J.C. Penney Company, Inc (NYSE: JCP) jumped 8.38% yesterday in large part due to the following signs that could indicate a turnaround is coming: 

Shoplifting is Up. Shoplifting took a full percentage point off the department store chain's profit margins during the quarter. And while that may be interpreted as a good sign that customers are back in the store and (one way or the other) wanting the company's merchandise, its a bit more complicated than that according to the Wall Street Journal. Apparently, sensor tags designed to prevent theft were removed from merchandise because they would have interfered with the radio frequency of new radio frequency identification, or RFID, tags which would introduced to make it easier to manage inventory. J.C. Penney Company is now retagging items on the sales floors with sensors as well as tightening up its returns policy which had encouraged scammers. My Mother is Back in the Store. The return of discounts or sale ads has gotten my mother back into the her local J.C. Penney. Granted, older women were not the demographic that a coastal hipster like Ron Johnson wanted in his stores, but older women tend to have something hipper younger women (especially in this economy) don't have: MONEY…. Sales and Same-Store Sales Rise. Same-store sales rose 0.9% in October. That may not sound great but its also the first same-store sales rise since December 2011. In addition, sales results improved sequentially each month within the third quarter while online sales (on jcp.com) rose 24.5% year over year t0 $266 million.  The Hip Trendy C*** is Being liquidated. It will take awhile to get rid of all the "trendy" inventory that Ron Johnson brought into the store and the company will need to deeply discount what's left to get it out the door, but once its gone – its gone (and not so hip customers like older women will be able to find what they want). So losses should start to ease in coming quarters. Liquidity Problems are Easing. J.C. Penney Company had lined up a $2.25 billion financing package earlier this year, sold nearly $800 million in new shares September to further shore up its finances and stuck to its forecast for more than $2 billion in liquidity at fiscal year-end. So baring a real disaster or credit crunch that hits the whole economy, it looks like J.C. Penney Company is not in danger of running out of cash or financing. Optimistic Forecast. J.C. Penney Company expects comparable store sales and gross margin to improve sequentially and year over year plus the CEO has also expressed optimism about the upcoming holiday season. "Normalization," For Better or For Worst. For what his opinion might be worth, CNBC's Jim Cramer made the following comment after earnings – which can be taken either way by investors:

"This is the beginning of what I regard as the normalization of J.C. Penney. "We won't be talking about J.C. Penney a year from now—not because they are not thriving or because they are going out of business, but because they're just nothing. They're going to go back to being nothing."

So is J.C. Penney Company finally a buy or a compelling value play? Consider the following long long long term chart for the stock:

Stock splits aside, the stock is trading at levels not seen since 9/11 or the 1980s. Nevertheless, the bearish trend lines on the latest J.C. Penney Company technical chart looks like they might be ready to reverse:

With the above considerations in mind, an investor or speculator with a high tolerance for risk just might want to take a gamble on a J.C. Penney Company turn around.

What Makes Customers Buy Bank Products?

Banks around the world are losing revenue by missing opportunities to deepen their existing customer relationships, and are ceding new product sales to competitors, according to Bain & Co.

In its fourth annual report on banking customers’ loyalty, Bain’s surveyed more than 190,000 customers in 27 countries, and found the following:

Bain said that although many factors influenced the new product purchase decision, such as level of competition in a local market, two factors stood out in swaying customers to buy: customers’ loyalty to their primary bank and the bank’s ability to actively sell to its customers.

The report found that a bank’s relative customer loyalty measure explained roughly half of the variation in its relative win rate, and that approximately a third of banking products in the U.S. were sold, not bought. Customers did not plan to buy a particular product, but received an offer and then decided to purchase it.

“The ‘easy growth’ is over for banks, as increased competition worldwide is forcing banks to fight over too few new customers,” Gerard du Toit, a partner in Bain’s global financial services practice and lead author of the report, said in a statement.

“But there is a surprisingly large upside with existing customers to increase win rates on new product sales.”

According to the report, the unbundling of financial products has spread through some countries faster than others. In Hong Kong’s highly competitive market, three-quarters of bank customers bought a new product over the past year, though only slightly more than half did so through their primary bank.

In contrast, 38% of customers in Denmark bought a new bank product, with 81% staying with their primary bank.

The report recommended a model of “loyalty plus five capabilities” to spur existing customers to buy more from their existing bank, attract new customers and reduce costs without damaging customer relationships. The five key capabilities:

The report showed that few large incumbent banks had made meaningful progress on more than one of the five elements. JPMorgan Chase in the U.S. was an exception, Bain found.

Chase posted the biggest loyalty gains in 2013 among the national banks, as measured by Bain, moving from the third quartile to the second quartile and opening a lead over other national banks.

Bain attributed Chase’s progress to such factors as select investments in mobile technology, a concerted effort to improve the customer experience and effective marketing to tell people how the bank could simplify their financial lives. Those factors combined to help Chase perform well above average in winning new relationships and cross-selling to existing customers, Bain said.

“The banking math is simple,” du Toit said. “Loyal banking customers own more products, and buy more products — but that doesn’t mean they’re going to make your sales for you.”

---

Check out Banks' Bad Rap Dampens Advisor Recruiting: SIFMA Panel on ThinkAdvisor.

Why Electronic Arts, Maximus, and Western Union Dropped Today

Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.

Dow 16,000, S&P 1,800, and Nasdaq 4,000 didn't become reality today, but each of these benchmarks came close to reaching those respective levels as investors continued to respond favorably to the macroeconomic and monetary-policy environment going forward. But despite the market's broad gains, Electronic Arts (NASDAQ: EA  ) , Maximus (NYSE: MMS  ) , and Western Union (NYSE: WU  ) gave up ground today with fairly substantial drops. Let's take a closer look at why these stocks bucked the market's favorable trend today.

Electronic Arts declined 7% in a surprising move, given that the maker of console-based video games should arguably be celebrating the release of the PlayStation 4 today. Yet even with the new console available and the Xbox One following next week, investors ignored analysts at Piper Jaffray and sent the stock stumbling. With NPD Group reporting that industrywide video game software sales rose 4.7% in October even in advance of the new consoles, long-term trends seem favorable even though several of its games didn't rank as highly on top-sellers' lists last month as in previous months.

Maximus posted a 5% drop despite reporting quarterly profit that rose by more than half from the year-ago quarter. The company benefited from its role in helping six health-insurance exchanges under the Affordable Care Act, including those in New York and the District of Columbia. But Maximus gave dour forward guidance, projecting a revenue range below current expectations and earnings that could be as much as a dime per share lower than what investors expect to see.

Western Union fell 4% after news surfaced that the Central Intelligence Agency is collecting data on money transfers as part of its larger attempts to gather foreign intelligence. Although Western Union already complies with various rules designed to protect against money laundering and financing potential terrorist activity, the report about the CIA could well deter some of its customers from using the service to send money abroad, as well as raising compliance costs generally.

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Morgan Stanley Resumes Coverage on Potash Corp (POT)

Morgan Stanley announced on Monday that it has resumed coverage on Potash Corp (POT).

Morgan Stanley analyst Vincent Andrews stated that the company has assigned the fertilizer stock an “Equal Weight” rating, warning “We remain cautious on the overall potash market, though more because of loose supply/demand fundamentals than because of dynamics in Russia/Belorussia. Potash prices have been moving lower for 8 quarters in a row now (7 of which BPC was fully functioning) and prices were continuing to drift lower in the weeks preceding the BPC break-up (recall Mosaic’s disclosure about lower prices in the Brazilian market on its July 16th earnings call.”

Potash shares popped 1.55% during Monday’s session. Year-to-date, the stock has fallen 21.35%.

Lots of Reasons To Sell

MoneyShow's Jim Jubak highlights the number of reasons traders had to sell well ahead of the Labor Day holiday and he ponders what might happen once the holiday is over.

Apparently, Wall Street decided that the Labor Day weekend started on Tuesday, August 27. It really can't blame traders for deciding that they wanted to get out of the market before the holiday weekend started and get out early. We looked at the things. We've got the possibility of some kind of US led military intervention in Syria. We've got worries about who President Obama is going to nominate to be the next Fed chairman after Bernanke. You've got increased rhetoric from the Republicans about shutting down the government over the debt ceiling battle or over the budget battle; and increased rhetoric from Treasury Secretary Jack Lew about "Well, we're not going to bargain."

All that stuff makes the market really, really jittery and you've got to say, "So, why am I here? Why don't I just sell?" That's what the market decided to do on Tuesday. Going forward the question is, "What happens a week from now?"

When everybody comes back on Tuesday, after Labor Day, do we get a continuation of the selloff because a lot of these negative events will still be out there; or basically will people say "Oh, okay, so I sold off and now we need to re-establish some of these positions that I got rid of? I'm now going to be at work, so I don't need to just get out of the market, I can actually be intelligent about what I'm going to own, buy, sell, etc."

One of the problems, one of the issues here, really, is that there is not much in the way of positive catalysts to encourage somebody to stay in the market for September and October, so maybe everybody just decides that whatever positions they took off before the break, they're just going to keep off. You've also got a lot of indexes that are hovering around make/break levels. They're near support. They're about to go through support. That, again, could lead the market to decide, "well, hey, you know we're in the middle of a selloff. I don't want to re-establish positions while things are headed down."

Really, the days to watch are Tuesday after Labor Day, Wednesday after Labor Day, Thursday after Labor Day, to see, really, what happens once the market gets back to normal trading activity and whether people decide that the selloff before Labor Day really needs to continue or whether it was something that was simply a holiday selling spree.

This is Jim Jubak for the moneyshow.com video network.

These Stocks Helped the Dow Eke Out a Gain Today

The Dow Jones Industrials (DJINDICES: ^DJI  ) closed at another record high today, as the average managed to pick up three points to add to its big gains from yesterday's session. The index traded down the entire afternoon, but investors got more optimistic toward the close, as broader markets showed much more strength. The S&P 500 climbed 0.3%, setting another new record, while the Nasdaq rose 0.6%, to climb above the 3,600 level for the first time since 2000.

As I discussed earlier this afternoon, financial stocks ended up the big winners on the day in the Dow. But two consumer-oriented stocks also posted decent gains, with Procter & Gamble (NYSE: PG  ) and Home Depot (NYSE: HD  ) picking up the better part of 1% each. For P&G, a healthy 3% yield is alluring to investors seeking relative safety and solid income and, despite the strategic mistakes that led to the departure of former CEO Robert McDonald, P&G has seen its stock rise toward new record highs of its own.

Meanwhile, Home Depot has raised considerable doubt about the viability of its big recovery, as rising mortgage rates threaten the recent surge in home prices. Yet, long-term investors should recall that Home Depot managed to fare quite well even when home prices were weak, as it shifted its strategy to focus on renovations by homeowners who were essentially stuck in their homes, and needed to consider work on their current residences rather than trading up to more attractive properties.

The real action for rising stocks happened outside the Dow, though. RadioShack (NYSE: RSH  ) regained all of its lost ground from yesterday, soaring 11% as it countered rumors that it was considering a bankruptcy filing. Rather, the company said that recent discussions with investment banks were connected to its efforts to strengthen its balance sheet. Investors took this as a positive sign that the company was essentially denying the bankruptcy rumors, but the electronics retailer still faces the tough challenge of making itself relevant in a very crowded space that's full of companies trying to reinvent themselves.

Finally, WebMD (NASDAQ: WBMD  ) jumped 25%, as the company released preliminary results that crushed expectations. The medical website now expects to turn a profit for its full 2013 year, turning around earlier predictions of a similarly sized loss. Depending on how successful the company is at making deals for private portals like the contract it secured from the Blue Cross and Blue Shield Federal Employee program, WebMD could continue to see ramped-up growth in future years, as well.

One potential driver for WebMD will be employer initiatives to try to respond to cost concerns about Obamacare. To learn more about Obamacare and its impact on you, read The Motley Fool's new free report, "Everything You Need to Know About Obamacare." Inside, you'll learn how your health insurance, your taxes, and your portfolio could be affected. Click here to read more. 

How to Buy Stock Now -- and Why You Should

Lots of us want to invest in the stock market, but many have not done so yet. Why? Well, some think they don't have enough money to invest yet, and some think it's not the right time, and others just aren't sure how to invest. Let's get all of these excuses out of the way, shall we? -- because stocks are one of the best ways to build a nest egg for retirement.

Don't have enough?
If you're not bothering to learn how to buy stock because you think you're not rich enough, think again. You really don't need a lot of money to start investing. You don't have to buy at least 100 shares of a stock, either. You can usually buy as little as one share of a stock, though you do want to keep your commission costs under control. Paying, say, $10 to buy a $10 stock is a bit much. Low trading rates abound, and with a $10 fee, you can spend $500 on a stock or fund and only be paying 2% in commissions.

Plenty of brokerages charge relatively low fees (such as $10 or less per trade) and have low minimum investment requirements to open an account, too -- sometimes just $500 or even no minimum at all.

It's too soon or too late?
If you're thinking you don't need to worry about how to buy stock because you're too young or too old to invest, you're wrong. Young folks may not have much money, but they're rich in something most of us are far poorer in: time. If you invest just $1,000 at age 15 and it grows for 50 years at 10% annually, you'll end up with more than $117,000 at 65. If you start with $5,000 at age 25, it can turn into almost $600,000 by age 75. Add more along the way and you'll be even richer.

Meanwhile, many people make it to age 90 or beyond. If you're 65 today, you might still have a good 25 years ahead of you, if not 35!

You don't know how to buy stock?
If you don't know how to buy stock, you're not alone. Few of us are ever taught much about investing. Fortunately, the basics are pretty simple. You might, for example, just park most of your nest egg in a few low-cost broad-market index fundsSPDR S&P 500 ETF (NYSEMKT: SPY  ) (which tracks the S&P 500) or Vanguard mutual funds or ETFs. (ETFs are exchange-traded funds, and are kind of like a cross between a stock and a fund.) You can include bonds easily, too.

With most mutual funds, you can open an account directly with the mutual fund company -- such as Fidelity or Vanguard. Click over to their website and you'll be able to either fill out account application forms online or download them to print, fill out, and mail in -- with a check to fund the account. You can open regular accounts or IRA accounts, which offer tax advantages and come in traditional and Roth forms. You can also buy most stocks and a wider range of mutual funds through regular brokerages, which try to make the account-opening process simple via their websites.

Learning how to buy stock is pretty easy, but figuring out what to invest in can take a little more time. Consider keeping it simple, with index funds, at least until you're comfortable with fancier fare, such as individual stocks. 

Are you prepared for retirement?
Making the right financial decisions today makes a world of difference in your golden years, but with most people chronically under-saving for retirement, it's clear not enough is being done. Don't make the same mistakes as the masses. Learn about The Shocking Can't-Miss Truth About Your Retirement. It won't cost you a thing, but don't wait, because your free report won't be available forever.

Survey: Budget Cuts Not Hurting U.S. Businesses

Gerry Broome/APBusiness owners, such as Tom Raper, owner of Bragg Pawn Shop near Fort Bragg in North Carolina, wonder how budget cuts will effect business. More than 8,500 civilian employees on the military base will be furloughed one day a week starting this month. NEW YORK -- Washington's budget tightening is having a minimal effect on businesses, a survey of business economists released Monday shows. The National Association for Business Economics survey asks how higher taxes and lower government spending affected businesses in the first three months of 2013. Ninety-three percent of respondents say the political developments had no effect on employment levels in the first quarter, and 95 percent say they had no impact on capital spending plans. Overall, the results paint a picture of businesses feeling better than they were in the fourth quarter, but not as good as they were a year ago. The NABE did caution, however, that businesses might have already accounted for the higher taxes and lower government spending in the fourth quarter, and adjusted their hiring and spending plans before the end of 2012. The NABE surveyed a small sample, 58 members, between March 19 and April 2. They represent a variety of sectors, including finance, transportation, health care and manufacturing. Among the results: Fifty-five percent of respondents reported rising sales -- up from 37 percent in the fourth quarter, but down from 60 percent a year ago. Twenty-nine percent reported rising profit margins -- up from 25 percent in the fourth quarter, but down from 40 percent a year ago. Thirty-one percent said wages and salaries are rising -- up from 27 percent in the fourth quarter, but down from 44 percent a year ago. The improving quarter hasn't translated into more jobs. Only 22 percent said they added employees. That was down from 25 percent in the fourth quarter, and 28 percent a year ago. Expectations for the future followed a pattern similar to many of the other results -- better than the fourth quarter, worse than a year ago. Sixty-five percent said they expect the economy to grow by more than 2 percent over the next year, up from 50 percent in the fourth quarter but down from 78 percent a year ago. Overall, they listed global economic conditions, the possibility of further government spending cuts and the "regulatory environment" as their biggest concerns for the next three months. The services industry, including retail, health care and restaurants, was most concerned with the possibility of further government spending cuts. The finance industry and goods producers, such as manufacturing and construction companies, were most concerned by global economic conditions.

Anadarko Petroleum Earnings: Portfolio Optimization Fuels Strong Results

As you've probably noticed, oil prices have taken a dive this year. In fact, crude oil in the United States recently fell to $79 per barrel. That's a multi-year low for West Texas Intermediate and a 27% decline from the price per barrel reached just a few months ago. While that's great news for consumers who will spend less at the pump and keep more of their discretionary income, it's terrible news for oil and gas companies.

Because of what's happening in the oil market, this earnings season was supposed to be a disaster for oil and gas companies, and particularly for companies in the exploration and production industry, as those companies are even more highly sensitive to fluctuations in oil prices than their larger integrated peers are. However, Anadarko Petroleum (NYSE: APC  ) proved its doubters wrong by posting strong third-quarter results that beat the overarching fears of a major slowdown in the oil and gas industry.

Here is a breakdown of Anadarko's results, as well as the strategic decisions made that helped fuel its successful quarter.

Strategic moves are producing results
Anadarko has worked aggressively to divest non-core assets and reinvest the proceeds in the oil and gas fields it deems most attractive for future development. Last quarter alone, Anadarko closed on the $1.075 billion sale of its China unit, and it also closed on $1.2 billion worth of additional divestments. Those moves left the company in a strong financial position, with $8.3 billion of cash on hand. Going forward, it will use its financial resources to expand in its key portfolio assets.

One of the company's areas of focus is the Wattenberg field, a large natural gas field located in Colorado's Denver Basin, where Anadarko recently embarked on a horizontal drilling program that has produced excellent results. That, in conjunction with midstream expansions, helped Anadarko to grow sales volumes at Wattenberg by 87% last quarter, year over year. Anadarko also has strong acreage positions in the Eagle Ford and Wolfcamp fields.

Separately, Anadarko is heavily involved in the deepwater Gulf of Mexico. The company has invested huge resources there in a massive new project that's nearing completion. The Lucius project is on schedule, and first oil is expected within the next few weeks.

Because of the company's strategic initiatives undertaken over the past year, Anadarko's underlying fundamentals are improving. Last quarter, earnings soared to $2.12 per diluted share, up from just $0.36 earned in the same period last year. Of course, it needs to be stated that most of this performance was due to one-time events that aren't part of the company's core operating activities. For example, Anadarko realized approximately $1 billion on gains from derivatives and divestitures.

Still, even when excluding these items, Anadarko still had a good quarter. Production stayed strong, despite the drop in oil prices over the past several months. Anadarko's sales volumes of oil, natural gas, and natural gas liquids rose 14% last quarter, year over year, to an average of 849,000 barrels of oil equivalents per day, a figure that includes adjusting for its divestments. Because of the strong progress seen over the first several months of 2014, Anadarko management increased its sales volume forecast for the remainder of the year.

Production growth should provide shelter from the storms
The oil and gas industry looks like a scary business right now, what with the carnage rippling through the energy markets. The price of oil has collapsed in just the past few months, which is showing up in the earnings reports out of Big Oil. However, not all oil and gas companies are struggling. Anadarko Petroleum is thriving, despite the decline in oil prices. That's because Anadarko is benefiting from an aggressive divestment strategy, which has allowed the company to simultaneously shed underperforming projects as well as raise funds necessary to fuel expansion in higher-performing areas.

It also allowed Anadarko to post strong results last quarter, as well as increase its forecast for the remainder of the year.

Do you know this energy tax "loophole"?
You already know record oil and natural gas production is changing the lives of millions of Americans. But what you probably haven't heard is that the IRS is encouraging investors to support our growing energy renaissance, offering you a tax loophole to invest in some of America's greatest energy companies. Take advantage of this profitable opportunity by grabbing your brand-new special report, "The IRS Is Daring You to Make This Investment Now!," and you'll learn about the simple strategy to take advantage of a little-known IRS rule. Don't miss out on advice that could help you cut taxes for decades to come. Click here to learn more.

Anadarko Petroleum Earnings: Portfolio Optimization Fuels Strong Results

As you've probably noticed, oil prices have taken a dive this year. In fact, crude oil in the United States recently fell to $79 per barrel. That's a multi-year low for West Texas Intermediate and a 27% decline from the price per barrel reached just a few months ago. While that's great news for consumers who will spend less at the pump and keep more of their discretionary income, it's terrible news for oil and gas companies.

Because of what's happening in the oil market, this earnings season was supposed to be a disaster for oil and gas companies, and particularly for companies in the exploration and production industry, as those companies are even more highly sensitive to fluctuations in oil prices than their larger integrated peers are. However, Anadarko Petroleum (NYSE: APC  ) proved its doubters wrong by posting strong third-quarter results that beat the overarching fears of a major slowdown in the oil and gas industry.

Here is a breakdown of Anadarko's results, as well as the strategic decisions made that helped fuel its successful quarter.

Strategic moves are producing results
Anadarko has worked aggressively to divest non-core assets and reinvest the proceeds in the oil and gas fields it deems most attractive for future development. Last quarter alone, Anadarko closed on the $1.075 billion sale of its China unit, and it also closed on $1.2 billion worth of additional divestments. Those moves left the company in a strong financial position, with $8.3 billion of cash on hand. Going forward, it will use its financial resources to expand in its key portfolio assets.

One of the company's areas of focus is the Wattenberg field, a large natural gas field located in Colorado's Denver Basin, where Anadarko recently embarked on a horizontal drilling program that has produced excellent results. That, in conjunction with midstream expansions, helped Anadarko to grow sales volumes at Wattenberg by 87% last quarter, year over year. Anadarko also has strong acreage positions in the Eagle Ford and Wolfcamp fields.

Separately, Anadarko is heavily involved in the deepwater Gulf of Mexico. The company has invested huge resources there in a massive new project that's nearing completion. The Lucius project is on schedule, and first oil is expected within the next few weeks.

Because of the company's strategic initiatives undertaken over the past year, Anadarko's underlying fundamentals are improving. Last quarter, earnings soared to $2.12 per diluted share, up from just $0.36 earned in the same period last year. Of course, it needs to be stated that most of this performance was due to one-time events that aren't part of the company's core operating activities. For example, Anadarko realized approximately $1 billion on gains from derivatives and divestitures.

Still, even when excluding these items, Anadarko still had a good quarter. Production stayed strong, despite the drop in oil prices over the past several months. Anadarko's sales volumes of oil, natural gas, and natural gas liquids rose 14% last quarter, year over year, to an average of 849,000 barrels of oil equivalents per day, a figure that includes adjusting for its divestments. Because of the strong progress seen over the first several months of 2014, Anadarko management increased its sales volume forecast for the remainder of the year.

Production growth should provide shelter from the storms
The oil and gas industry looks like a scary business right now, what with the carnage rippling through the energy markets. The price of oil has collapsed in just the past few months, which is showing up in the earnings reports out of Big Oil. However, not all oil and gas companies are struggling. Anadarko Petroleum is thriving, despite the decline in oil prices. That's because Anadarko is benefiting from an aggressive divestment strategy, which has allowed the company to simultaneously shed underperforming projects as well as raise funds necessary to fuel expansion in higher-performing areas.

It also allowed Anadarko to post strong results last quarter, as well as increase its forecast for the remainder of the year.

Do you know this energy tax "loophole"?
You already know record oil and natural gas production is changing the lives of millions of Americans. But what you probably haven't heard is that the IRS is encouraging investors to support our growing energy renaissance, offering you a tax loophole to invest in some of America's greatest energy companies. Take advantage of this profitable opportunity by grabbing your brand-new special report, "The IRS Is Daring You to Make This Investment Now!," and you'll learn about the simple strategy to take advantage of a little-known IRS rule. Don't miss out on advice that could help you cut taxes for decades to come. Click here to learn more.

U.S. Dollar Rises and the Euro's Price Goes Under $1.34

NEW YORK (TheStreet) -- The euro has broken the $1.34 barrier. It closed at $1.3386 on Thursday. A month ago or so it looked as if the floor to euro trading was $1.36 per euro.

Continued weak numbers coming out of the eurozone, however, has convinced people that Mario Draghi, the president of the European Central Bank, is going to have to give in and resort to a greater amount of monetary easing, even moving to something he has rejected so far -- quantitative easing.

Read More: Warren Buffett's Top 10 Dividend Stocks

The European nations seem to be experiencing a growth rate of about 1% this year. Expectations for growth next year and for the after seem to be hung up below 2%. Disinflation continues to be the big news of the day as the estimated rate of price increase for July announced by Eurostat, the European Commission's statistical bureau, came in at an annualized rate of 0.4%. This is down from 0.5% for June. Expectations are for a further fall for vacationing Europeans in August, maybe only 0.3%. This information apparently got translated into European stock markets as averages experienced a substantial drop on Thursday. The Federal Reserve, on the other hand, seems to be moving in the opposite direction. The Open Market Committee of the Fed, which ended its two-day meeting on Wednesday, reduced the amount of securities it was purchasing monthly to $25 billion and there were indications that some of the more "hawkish" members of the committee were pushing for a rise in short-term interest rates, sooner, rather than later. I recently noted the fall in the price of the euro have been started by testimony in front of Congress by Fed Chair Janet Yellen. In her "Fedspeak," Yellen alluded to the fact that the economic recovery in the U.S. might be recovering more rapidly than had been thought recently. This might contribute to the need for interest rates to rise sooner than previously expected. When the second-quarter GDP numbers were released, ecstasy was expressed in some areas such as the  Financial Times' "US Economy Roars Back With 4% Growth in Second Quarter." Hence, growing expectation that the Federal Reserve may, in fact, seek higher short-term interest rates sooner rather than later. It seems as if the investor's psychology in the stock market focused on higher short-term interest rates sooner as the S&P 500 dropped by almost 40 points. So, for the time being, it looks as if investors are believing that the European Central Bank will have to loosen up its monetary policy even further in the near future, and the Federal Reserve, whatever it does, will have a monetary policy that is relatively less easy than that of the ECB. Read More: Thar She Blows! The Fed-Induced Stock Bubble Has Popped Of, course, the cheaper euro is something that helps the ECB because it makes eurozone exports cheaper relative imports coming from America. Therefore, this is not considered to be a bad thing by eurozone officials. I mentioned in my earlier post that some people see the euro falling to $1.3200 by the end of the year. With the movements we have just seen, this level is not out of the question at all. This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff.

Beat the Insiders: Buy These Stocks At Lower Prices Than They Did

Popular Posts: 5 Best Dividend Stocks to Buy for Retirement Income3 Dividend Stocks Delivering Income for 50-Plus YearsWill 2014's Top Performers Keep Performing? Recent Posts: Beat the Insiders: Buy These Stocks At Lower Prices Than They Did 3 Dividend Stocks Delivering Income for 50-Plus Years 3 Naked Puts for a Puzzlingly Higher Market View All Posts Beat the Insiders: Buy These Stocks At Lower Prices Than They Did

The downside with insider sales is that you never really know the reasons why a given insider chose to sell the amount of shares they did, and why they chose to do so at the time. Maybe it's because they need to diversify their investments, maybe it's because they want to cash in some of their winnings, and maybe its because they know the company is about to implode.

That's why insider buying tells you a lot more. Very few people are going to risk their own hard-earned money purchasing stock of the company they work for unless they feel pretty certain the stock is undervalued, or they expect the stock to outperform other investments in the medium-to-long term.

Rarely, however, do other investors get the chance to buy in at or below the prices the insiders did. The price may have fallen for any number of reasons that have nothing to do with the long-term fundamental outlook. Regardless, you have to figure that there was insider buying at an even higher price, there's probably a floor to the stock price that you can be fairly certain of.

With that in mind, let’s look at three stocks that will let you beat the insiders:

Gulfmark Offshore (GLF)

In November and December of last year, director Robert Millard of Gulfmark Offshore (GLF) purchased some 74,000 shares between $44.19 and $48.71 per share. Earlier this year, another director purchased 2,800 shares between $44.72 and $49.16. The stock is at $44.88, which is lower than the average price either director bought at.

Gulfmark is a support company for the offshore oil and gas industry, operating transport vessels to help offshore rigs get set up and built. It has diversified into fleets for third-parties, but that's only about 10% of its 80-ship operation. Geographically, its headquarters are in Houston, but its fleet hangs out in the North Sea, Southeast Asia and in North and South America.

The insider buying likely happened because FY14 EPS is slated to rise 53%, and another 18% in FY15. Insiders do not appear concerned that the company has been FCF negative for the past two years. Perhaps the increase in EPS will change that trajectory.

United States Steel Corp. (X)

I can't say I've ever really thought about United States Steel Corp. (X). The legendary steel manufacturer has never been on my investing radar because I don't really understand the steel market, other than it being highly cyclical. U.S. Steel has lost tons of money for several years in a row, has been suffering negative FCF, but EPS is slated to turn positive this year to $1 per share and then double next year.

On January 3, director Robert McDonald purchased 1,000 shares at $29.84 per share. U.S. Steel has been increasing its cash position, and the last two quarters have turned profitable, giving credence to the EPS comeback. The stock is at $27.36, so it is below the insider buying price point. It's difficult to say how the stock will perform over the long term, but I trust an insider's view more than my own.

Steel companies haven’t had a great track record, as many have gone out of business over the years. Still, U.S. Steel has survived. The company also has a new CEO, so it sounds like things are headed in the right direction.

Cliffs Natural Resources (CLF)

Cliffs Natural Resources (CLF) has seen insider buying twice in the past year and a half. One director picked up 1,040 shares last Novemer at $28.33. Another grabbed 250 shares at $23.92. The stock is now at $15.49. The drop may be due to the fact that the company produces iron ore (good) and metallurgical coal (not so good, due to regulatory issues).

CLF has 16 mines throughout the U.S., but also owns and operates some exploration entities seeking resources in Canada. It has a more solid cash flow situation, in that it usually is $1-2 billion in the black on a FCF basis. It had a big write-off in 2012, but before that was doing very well and continues to generate a profit. The regulatory issues are weighing the stock down, but with the stock almost 50% of what it was since the last insider buy, you have to figure there's a potential bargain here.

In this case, I would actually wait for the next major instance of insider buying before jumping in.

As of this writing, Lawrence Meyers did not hold a position in any of the aforementioned securities. He is president of Asymmetrical Media Strategies, a crisis PR firm, and PDL Broker, Inc., which brokers financing, strategic investments and distressed asset purchases between private equity firms and businesses. He also has written two books and blogs about public policy, journalistic integrity, popular culture, and world affairs. Contact him at pdlcapital66@gmail.com and follow his tweets at @ichabodscranium.

To compete with robo-advisers, Nally proposes charging clients for all services

The man who leads the TD Ameritrade Inc. division serving registered investment advisers is pitching a new way for those firms to get paid as they stare down increasing competition from the online portfolio managers called robo-advisers.

Thomas Nally, president of TD Ameritrade Institutional, said firms should consider replacing the widely used fee based on assets under management with one based on total wealth under advisement.

“Don’t charge on just that one little slice of the pie. Why don’t we charge a lower basis point number on total wealth that you’re advising on so you can have the same number as some of these robo-advisers, but provide much more services?” said Mr. Nally.

According to the proposal, if an adviser provides tax or estate strategies associated with a home or business, for instance, they would assess a total fee that was linked to those assets, in addition to the client’s securities portfolio. By accounting for the wider array of assets covered, the overall fee could be lowered — making it competitive with the low headline figure advertised by online advisory firms, Mr. Nally said.

Mr. Nally’s remarks to a set of his firm’s top advisers Monday and in an interview with InvestmentNews Wednesday, reinvigorated discussion of alternative fee structures for financial advisers, a topic of years of discussion and consternation.

Some advisers see fees linked to assets under management as devaluing aspects of their service offerings beyond securities and investment manager selection, such as estate and tax planning. Others see the fee as an easy way to be rewarded for investment decisions that benefit clients and to participate, alongside those clients, in the upside of a rising market, such as the one enjoyed by U.S. stocks since 2009.

Figures on the number of advisers using fees for engagement or other alternative fee models are hard to come by. But anecdotally, the use of such models is marginal. That’s despite the advocacy of people like Sheryl Garrett, a fiduciary advocate who recommends hourly fees for advisers in her namesake network.

At the same time, in their move to transition to fee-based business and more planning-centric relationships, wir

Marc Faber - Stocks and Bonds Going Down at the Same Time

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Hussman: Sell Your Stocks Now!

Stock market investors who gleam with visions of selling their stocks at ever higher prices should cast their eyes at a chart of the S&P 500 over the last 20 years and get out now — or they will look at that same chart in the future and ask themselves “What was I thinking?”

So warns Hussman Funds portfolio manager John Hussman in his most recent letter to shareholders, his latest in a years-long series of warnings about the risk of stock market valuations, which he now characterizes in perhaps his most emphatic terms yet:

“Prospective returns have reached zero. The value you seek from selling in the future is already on the table today. The future is now.”

The portfolio manager known for his bearish views but also for some prescient market calls writes that some of the “saddest  notes” he received in the 2000-2002 and 2007-2009 bear markets came from investors lamenting “I wish I had listened.”

The losses of those bear markets wiped out the total S&P 500 gains all the way back to May 1996 in the former case and even further, to June 1995, in the more recent crash.

To convey a bit of how that feels, Hussman quotes a 2001 warning he issued conservatively estimating price targets for Cisco at $18 ¾ (when its 52-week high was $82), Sun Microsystems at $4 ½ (when its 52-week high was $64), EMC at $10 (when its 52-week high was $105) and Oracle at $6 ⅞ (when its 52-week high was $46).

With the ensuing crash, three of those stocks fell 50% below these price targets, and one of them hovered near the target price.

But the overvaluation of that period — and here’s the core of Hussman’s current warning — pales in comparison to current market conditions.

“The median price/revenue multiple for S&P 500 constituents is now significantly higher than at the 2000 market peak,” Hussman writes.

Only by looking at market-cap weighted price/revenue multiples can one find two quarters where valuations were higher in 2000, but Hussman recalls that the market at that time favored megacap stocks, which skewed the “average” versus “median” yardstick. (Though even viewed in terms of a cap-weighted ratio, he says the historical norm is less than half current levels.)

The Hussman Funds manager focuses his analysis on price to revenue rather than price to earnings because of the unreliability of profit margin assumptions embedded in the former. But he argues that one has to view current record-high profit margins as permanent, “against all historical experience,” to see current valuations as anything other than historically extreme.

That means that anything short of a seven-year time horizon implies negative total returns; a 10-year time horizon carries an expectation of “weak total returns;” and Hussman warns passive buy-and-hold investors that a 50-year horizon is needed to justify such a strategy.

The academic-turned-manager known for his data-driven approach offers something of an apology, or encouragement to hang on, to Hussman fund investors who have missed the large gains in recent years during which his funds have followed a risk-off approach.

“Though we fully anticipated the 2008 credit crisis and had no qualms about valuation after the market plunged,” the imperative of “stress-testing against Depression-era outcomes … prevented us from accepting opportunities in the recent half-cycle.”

But that “miss,” he adds, “should not be a reason for investors to ignore the objective risks over the completion of this cycle – from what is now the richest broad market valuation that investors are likely to observe in their lifetimes.”

The doomsaying portfolio manager hits an upbeat note in anticipation of a time when his portfolio need not be defensively oriented, saying “we remain enormously optimistic about investment opportunities that are likely to emerge over the completion of the present market cycle and beyond.”

New website to link nation's veterans, employers

FORT CAMPBELL, Ky. — First Lady Michelle Obama announced a new online tool Wednesday to help military veterans connect with employers and said some of the nation's biggest companies are expanding the number of veterans they hire.

In a speech that was the kind of pep talk you would expect for new college graduates, the first lady offered a twist — the notion that soldiers who have seen combat in Iraq and Afghanistan probably can handle a job interview at Xerox or UPS.

"Today we need you to start thinking and talking about yourselves for a change," she said. "Don't be afraid to brag a little bit about yourselves."

Obama announced the new private-sector commitments to hire veterans, including Capital One Bank's pledge to hire 55,000 veterans and their spouses, a doubling of UPS' commitment from 25,000 to 50,000 jobs and 10,000 new jobs for veterans at Xerox.

STORY: Recent veterans struggle to find jobs
STORY: States launch programs to help veterans find jobs

"Today, more than 100 companies have come here for one purpose — to hire you," she said at a jobs summit here for transitioning veterans. "We've got your backs."

She urged veterans not to be shy about their experiences and what they can bring to the job.

"If you want a job, you can't be modest about your qualifications," Obama said. "Anyone out there would be lucky to have you on their team."

I guarantee you: They'll be the best employees you have.

-

The Veterans Employment Center, available at www.ebenefits.va.gov, allows veterans to see the benefits they've accumulated during their service, post a resume and learn what kinds of jobs they might be able to do based on their skills.

Roughly 700,000 to 800,000 military veterans are in the job market at any given time, said Rosye Cloud, senior adviser for veteran employment with the U.S. Department of Veterans Affairs. That number includes about 240,000 people who have become veterans since the Sept. 11, 2001, terrorist attacks.

! Nationwide, 172,000 post-9/11 veterans were unemployed in March, down from 207,000 the year previous, according to the Bureau of Labor Statistics. That translates to a 6.9% jobless rate, compared with 9.2% a year ago. The overall national rate was 6.7%.

The new web tool is the first of its kind from the federal government, Cloud said.

"As my husband said, 'You fought for us; you shouldn't have to fight for a job,' " the first lady said.

Earlier at the summit, Maj. Gen. James C. McConville said the Army has a responsibility to make sure its veterans can move smoothly into civilian life with good jobs.

Michelle Obama has her photo made with a soldier after speaking April 23, 2014, at veterans job summit at Fort Campbell, Ky.(Photo: Michael Clevenger, The (Louisville, Ky.) Courier-Journal)

The commanding general of the 101st Airborne Division at Fort Campbell said his father, also a veteran, was able to "send all his kids to college and live the American dream" thanks to the G.I. Bill and steady employment.

"And that's what we owe our veterans today," McConville said.

Sgt. Clay Loymendy, 24, of Riverside, Calif., has been stationed at Fort Campbell for more than two years. He said he'll probably go to a technical school soon so he can start working in wind turbine production or as a cell tower technician.

Brig. Gen. David K. MacEwen, adjutant general of the Army, said employers should know that veterans are fit and drug free and will show up to work on time.

"I guarantee you: They'll be the best employees you have," MacEwen said.

Speakers at the forum Wednesday spoke of a period of major changes for soldiers, veterans, their families and the communities they! live in ! as the war winds down and the number of troops shrinks.

Veterans sometimes have to change their mindset when they leave the battlefield for the job market, MacEwen said.

Soldiers are accustomed to talking in terms of "we" and what their team has accomplished, but they have to make a transition to "I" and individual achievements, he said.

Medal of Honor recipient Dakota Meyer speaks at the Ft. Campbell Veterans Jobs Summit and Career Forum. April 23, 2014(Photo: Michael Clevenger, The (Louisville, Ky.) Courier-Journal)

Eric Eversole, executive director of the U.S. Chamber of Commerce Foundation's Hiring Our Heroes program, said too many veterans don't know how to make a "30-second elevator pitch" about themselves and their skills.

Veterans need to put their military service front and center on their resumes, he said.

Others at the summit included Marine Sgt. Dakota Meyer. Meyer, a Medal of Honor recipient for bravery in saving members of his team in Afghanistan in 2009, said young veterans of the post-9/11 wars in Iraq and Afghanistan have no good reason to be unemployed.

Meyer received a standing ovation from the 101st Airborne Division. But speaking from personal experience, he said not a lot of job descriptions ask for former snipers.

Meyer, who is working with the Chamber of Commerce Foundation in its outreach to veterans, said the government's launch of its integrated jobs website will help bridge that gap, translating military skills to civilian terms.

He said less than 1% of this generation has carried the burden of America's longest war. That means the civilian and military worlds have a difficult time understanding each other.

"It's something as small as in the! military! we call it a mission and in the corporate world they call it a project," he said.

Contributing: Philip Grey, The (Clarksville, Tenn.) Leaf-Chronicle; Duane Gang, The Tennessean; and The Associated Press

Fort Campbell soldiers listen to panels discussing jobs after the military at an April 23, 2014, career forum.(Photo: Michael Clevenger, The (Louisville, Ky.) Courier-Journal)

Six apps that might make parenting easier

Parents wear a lot of hats when it comes to their kids, including being the timekeeper, the money giver and the behavior police.

Do you have a child who is always up before everyone else? There's an app for that. How about keeping track of multiple allowances? Yes, an app can make it easy. Want reinforcements for wrangling kids at bedtime, teaching them potty training, explaining screen time restrictions and modeling good behavior? Storybook apps have you covered. Here's a list of clever apps that are designed to make your parenting job easier.

Sleepasaurus - Dinosaur Sleep Trainer for Kids

(Wee Taps, best for ages 2-6, $1.99, iPhone, iPod Touch, iPad; 4 out of 4)

Does your toddler or preschooler frequently get up way before the crack of dawn? "Sleepasaurus" might be just want you need. Kids choose one from seven baby dinosaurs and then sprinkle magic sleeping dust over it just before bedtime. Once the dinosaur is asleep, it can't be awakened until a time set by the parents. The idea is that the dinosaur becomes your child's sleeping buddy. If your child wakes up too early, the app trains your early riser to go back to sleep until such time as the dinosaur is awake and can roar when touched. Parents also have the option of setting the app to play bedtime music for going to sleep as well as music to wake up your child. This is a clever app that doubles as a nightlight if plugged in; and it operates masterfully.

The Adventures of Ash & Ollie: ScreenTime - A Fingerprint Network App (also on Android)

(Fingerprint, best for ages 3-6, $2.99, iPhone, iPod Touch, iPad, Android; 4 out of 4)

Two little brothers, Ash and Ollie, really like playing on their tablets and video game players. But their parents have taught them the importance of balancing screen time with other forms of play. By having your kids read this story about how another family imposes rules around screen times, it just might make it easier for you to do the same.

Tico Timer - your fun timer f! or children!

(Ricardo Fonseca, best for ages 3-8, $.99, iPhone, iPod Touch, iPad; 4 out of 4)

For children who can't yet tell time, this app presents the passage of time in a visual manner. The app has 11 different visuals, from colored circles slowly disappearing off the screen to a shrinking circle eventually vanishing. Parents can use the app to let kids know that they have ten more minutes until bedtime, 30 minutes of screen time left or two minutes for brushing of teeth. The easy-to-set timer screen can be accompanied by one of seven musical tracks.

Kiddie: positive parenting toddlers 2-5 years: reading, reward charts and fun songs

(Kiddie App, best for ages 2-5, Free, iPhone, iPod Touch, iPad; 4 out of 4)

This free app presents an adorable story about a bear-like character named Kiddie who is getting ready for bed. Using funny made-up rhyming phrases such as "Wopsie Dopdie Deeth, Wash your hands and brush your teeth," this app draws kids into the process of getting Kiddie to bed. Your child will tap on Kiddie's blanket to draw it up and turn on Kiddie's iPad so that his parent can read him a bedtime story. The tale also contains a cute song. Most importantly, the story introduces Kiddie's Reward Chart for going to bed easily and then lets parents create one for your child too.

For $2.99 each, parents can buy additional interactive stories about Kiddie: learning to use a potty, exploring foods at dinner time and discovering how to be sweet. If you want to purchase all three, the cost is $5.99. Each delivers a strong message about proper behavior and lets you set up a reward chart for your child — just like Kiddie's. I would recommend buying all three since they are so well done.

Achieve It With Sesame Street (also on Android)

(Sesame Street, best for ages 3-5, Free, iPhone, iPod Touch, iPad, Android; 4 out of 4)

Elmo monster presents a series of financially based challenges for you and your child to do, away from the device. For example, the c! hallenge ! might be to sort coins, hand money to a cashier or checkout an ATM machine. For each challenge, Elmo asks that you take a photo during the challenge (or you can select one of the Sesame Street monsters instead). Completion is rewarded with a sticker or the unlocking of a special Sesame Street video about a financial topic. By playing through these challenges together with your child, you will have lots of opportunities to discuss the difference between what we want and what we need, that people work to earn money and that there are three parts to saving money: for spending, for sharing, and for long term savings.

PiggyBot

(BancVue, Ltd, best for ages 5-14, Free, iPhone, iPod Touch, iPad; 3.5 stars)

"PiggyBot" makes keeping track of your kid's allowance a piece of cake. It also introduces your child to the concept that saving should have three parts: spending, sharing with others, and saving. The app permits you set up profiles for multiple children and keeps all the record-keeping in one place. It also lets your kids set goals, so that they can see how to save for something they want.

Jinny Gudmundsen is the Editor of www.TechwithKids.com and author of iPad Apps for Kids, a For Dummies book. Contact her at techcomments@usatoday.com. Follow her @JinnyGudmundsen.

GM Boosts Faulty Ignition Switch Recall to 1.6 Million Cars

Tom Pidgeon/General Motors via APA 2006 Chevrolet HHR on display at the 2006 Detroit auto show. DETROIT -- General Motors on Tuesday doubled to 1.6 million the number of small cars it is recalling to fix faulty ignition switches linked to multiple fatal crashes. Just two weeks ago, GM (GM) announced the recall of more than 780,000 Chevrolet Cobalts and Pontiac G5s. It's now adding 842,000 Saturn Ion compacts, Chevrolet HHR SUVs and Pontiac Solstice and Saturn Sky sports cars. The company was immediately lambasted by a well-known safety advocate who says GM knew of the problem for years and waited too long to recall the cars even though people were killed because of the problem. GM says a heavy key ring or jarring from rough roads can cause the ignition switch to move out of the run position and shut off the engine and electrical power. That can knock out power-assisted brakes and steering and disable the front air bags. The problem has been linked to 31 crashes and 13 front-seat deaths. In the fatalities, the air bags didn't inflate, but the engines didn't shut off in all cases, GM said. It was unclear whether the ignition switches caused the crashes, or whether people died because the air bags didn't inflate. The vehicles being recalled include: Chevrolet Cobalts and Pontiac G5s from the 2005 through 2007 model years. Saturn Ion compacts from 2003 through 2007. Chevrolet HHR SUVs from 2006 and 2007. Pontiac Solstice and Saturn Sky sports cars from 2006 and 2007. Most of the cars were sold in the U.S., Canada and Mexico. According to a chronology of events that GM filed Monday with the National Highway Traffic Safety Administration, the company knew of the problem as early as 2004, and was told of at least one fatal crash in March of 2007. GM issued service bulletins in 2005 and 2006 telling dealers how to fix the problem with a key insert, and advising them to tell customers not to dangle too many items from their key chains. But the company's records showed that only 474 vehicle owners got the key inserts. GM thought the service bulletin was sufficient because the car's steering and brakes were operable even after the engines lost power, according to the chronology. By the end of 2007, GM knew of 10 cases in which Cobalts were in front-end crashes where the air bags didn't inflate, the chronology said. In 2005, GM initially approved an engineer's plan to redesign the ignition switch, but the change was "later canceled," according to the chronology. "They knew by 2007 they had 10 incidents where the air bag didn't deploy in this type of crash," said Clarence Ditlow, executive director of the consumer advocacy group Center for Auto Safety. "This is a case where both GM and NHTSA should be held accountable for doing a recall no later than the spring of 2007." GM North American President Alan Batey said in a statement that the process to examine the problem "was not as robust" as it should have been and said the GM of today would behave differently. "We will take an unflinching look at what happened and apply lessons learned here to improve going forward," he said. GM spokesman Alan Adler said that initially the rate of problems per 1,000 vehicles was low, so the company didn't recall the cars. NHTSA issued a statement that didn't address why the recall wasn't done sooner. The statement said the agency is communicating with GM about how long it took to identify the safety problem, but didn't specify if any action would be taken. Dealers will replace the ignition switch for free, but Adler said it will take some time for the parts to be manufactured and sent to dealers. No time frame was given for making the repairs. "We are deeply sorry and we are working to address this issue as quickly as we can," Batey said. -.

By Michael Zak | AOL Autos

A recent Interest.com study looked at the 25 largest metropolitan areas in the United States to see which median-income households in those respective areas can afford to purchase a new car, the average price of which was $30,550 in 2012, according to TrueCar. The study found that in only one city can residents actually afford a car with this sticker price -- Washington, D.C. Households with an average income in Washington, D.C. can afford a payment of up to $628, which would allow for purchase of a $31,940 vehicle. The next closest city, San Francisco, can only afford $537 per month, equating to a $26,786. While it's not news that Americans like to buy things that they can't afford, the data is a little surprising given how many great cars there are out there for well under $30,000. Solid hybrids, CUVs, sedans and sports cars can all be had for less than this.