5/28/08

Economics

protectionism (Free trade is a major positive for world and US economic growth.).

http://www.american.com/archive/2008/may-05-08/weak-trade-week

a rising tax and regulatory burden (Government has never proven that it could solve economic problems efficiently or satisfactorily.) On McCain/Obama cap and trade proposals:

http://article.nationalreview.com/?q=YjJmYjhiMDY3NDdjODU2NDMxNGExYmMzZDc5MGMyNzQ=

And:

http://www.clubforgrowth.org/2008/05/new_tv_ad_on_climate_bill.php

Data on housing prices:

http://bigpicture.typepad.com/comments/2008/05/case-shiller-pr.html

Politics

Domestic

International War Against Radical Islam

In case you missed this WSJ editorial on why the US invaded Iraq. The author has a new book out on the subject and it is getting great reviews from conservative commentators:

http://online.wsj.com/article/SB121184655427621367.html?mod=opinion_main_commentaries

The Market

Technical

Fundamental

Update on stocks/credit spreads:

http://bespokeinvest.typepad.com/bespoke/2008/05/stocks-and-spre.html

And on the TIPS spread (inflationary expectations):

http://mjperry.blogspot.com/2008/05/inflationary-expectations-are-deflating.html

Aggressive Growth Buy List

Company Close 5/27 Buy Value Range

Abercrombie & Fitch $72.65 $67-77

Ecolabs 43.61 43-49

FactSet Research 62.94 58-67

Medtronic 50.23 44-51

Microsoft 28.44 26-30

Rockwell Collins 61.08 61-70

SAP Inc 52.64 46-54

SEI Investments 23.45 22-25

Staples 23.27 20-23

CNBC Million Dollar Portfolio Challenge

Portfolio 1: Sold:

Bought:

Positions: Automatic Data Products, Colgate Palmolive, CR Bard. T Rowe Price

Portfolio 2: Sold:

Bought:

Positions: Blackrock, Mastercard, Nokia, Luxottica

Portfolio 3: Sold:

Bought:

Positions: Best Buy, Genuine Parts, McGraw Hill, Landstar

Portfolio 4: Sold:

Bought:

Positions: Home Depot, ExxonMobil, McGraw Hill, Nokia

Subscriber Alert

In the Market decline last week, several stocks on the Dividend Growth Buy List fell below the lower boundary of their Buy Value Range. In my rush to get out yesterday’s Morning Call, I forgot to include their names: Wells Fargo (WFC-$28). The Dividend Growth Portfolio has a small position and at this time will continue to Hold WFC; UPS (UPS-$68). The Dividend Growth Portfolio has a full position in UPS and will continue to Hold it; McGraw Hill (MHP -$40) and Illinois Tool Works (ITW-$52). The Dividend Growth Portfolio held neither of these stocks. No additional action is required.

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

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

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

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

The stock price of Johnson Controls (JCI-$33) has fallen below the upper boundary of its Buy Value Range. Accordingly, it is being Added to the Dividend Growth Buy List. The Dividend Growth Portfolio already owns JCI; no additional share will be purchased.

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

The stock price of American Vanguard (AVD-$14) has fallen below the upper boundary of its Buy Value Range. Accordingly, it is being Added to the Aggressive Growth Buy List. The Aggressive Growth Portfolio already owns AVD.

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

While I am not convinced that the Market has established a bottom of a new trading range, stocks are down quite a bit; so I want to nibble: At the Market open this morning, the Dividend Growth Portfolio will establish a new one third position in Automatic Data Processing (ADP-$42); the High Yield Portfolio will Add to its position in Bank of Nova Scotia (BNS-$48) ; and the Aggressive Growth Portfolio will Add to its positions in American Vanguard (AVD-$14) and SEI Investments (SEIC-$23).

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

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

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

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

News on Stocks in Our Portfolios

Bank of Nova Scotia (High Yield Portfolio) reported second quarter earnings per share of $.97 versus $1.03 recorded in the similar period last year. The bank also raised its quarterly dividend per share from $.47 to $.49.

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

A positive write up on Accenture (Aggressive Growth Portfolio):

http://seekingalpha.com/article/79136-what-the-hp-eds-deal-means-for-accenture

Donaldson (Aggressive Growth Portfolio) reported its third fiscal quarter earnings per share of 4.57 versus expectations of $.51 and $.49 reported in the comparable 2007 quarter.

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

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