11/7/07

Economics

fiscal profligacy (Government spending as a percent of GDP is too high and the looming explosion in entitlement expenditures will make it worse. There is no good solution save spending discipline.). A discouraging review of the politics of the Water Resources Bill:

http://townhall.com/columnists/RobertBluey/2007/11/04/bush%e2%80%99s_bold_veto?page=full&comments=true

Now comes the Farm Bill:

http://www.usatoday.com/news/washington/2007-11-05-farmbill_N.htm

The Club for Growth’s new report card on each Senator’s record on pork barrel spending:

http://www.clubforgrowth.org/2007/11/the_clubs_2007_senate_repork_c.php#more

Politics

Domestic

International War Against Radical Islam

Iran reaches nuclear landmark:

http://haaretz.com/hasen/spages/921111.html

The Market

Technical

Fundamental

This morning the Dividend Growth Portfolio will:

Sell ConocoPhillips (closed 85.14) December 95 calls (COPLS) for $0.625 against one quarter of its position.

Sell General Dynamics (closed 93.5) December 100 calls (GDLT) for $1.00 against one quarter of its position.

The High Yield Buy List

Company Close 11/6 Buy Value Range

USB $31.84 $29-33

KMP 52.06 51-58

DRE 30.23 31-35

FUN 23.40 23-26 (has not been purchased)

RAI 63.65 58-66

PAA 53.70 51-58 (has not been purchased)

News on Stocks in Our Portfolios

Peabody Energy (Aggressive Growth Portfolio) reported third quarter earnings per share of $.12 versus expectations of $.32 and $.53 recorded in the comparable 2006 quarter. Revenue, coal production and revenue per ton were all up above expectations. The earnings shortfall was related to the acquisition of its Australian company subsidiary. It also reiterated its 2007 earnings guidance, ex discounted operations.

EPS: 2006 $2.23, 2007 $1.75, 2008 $3.10; DVD: $.24 YLD .6%

http://finance.yahoo.com/q?s=BTU

Emerson Electric (Dividend Growth Portfolio) reported its fourth quarter earnings per share of $.78 versus expectations of $.75 and $.65 reported in the similar quarter in 2006.

EPS: 2006 $2.24, 2007 $2.65, 2008 $3.00; DVD: $1.10 YLD 2.4%

http://finance.yahoo.com/q?s=EMR

I am seeing very positive research reports on Medivation describing the results of their recently announced prostate cancer trial. Earnings estimates and price targets ($40+) are both rising. Anyone with an interest let me know and I will email more detail to you.

American Vanguard (Aggressive Growth Portfolio) reported third quarter earnings per share of $.20 versus $.16 recorded in the comparable 2006 quarter.

EPS: 2006 $.57, 2007 $.75, 2008 $1.00; DVD: $.07 YLD 0.4%

http://finance.yahoo.com/q?s=AVD

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