7/18/07

Economics

protectionism (Free trade is a major positive for world and US economic growth.) Some thoughts on a few trade issues:

http://www.danieldrezner.com/archives/003397.html

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.) The Senate versus the House on earmarks:

http://www.nytimes.com/cq/2007/07/17/cq_3098.html

Politics

Domestic

International War Against Radical Islam

The current state of progress with North Korea’s nuclear facilities:

http://www.pajamasmedia.com/2007/07/is_north_korea_seriously_disar.php

The Market

Technical

Fundamental

We have been stressing that the sub prime problem is not over:

http://bigpicture.typepad.com/comments/2007/07/contain-this-pa.html

News on Stocks in Our Portfolios

A positive writeup on Medtronic (Aggressive Growth Portfolio):

http://www.thestreet.com/_htmlmdb/newsanalysis/healthcare/10368278.html

Abbott Labs (Dividend Growth Portfolio) reported second quarter operating earnings per share of $.63 versus estimates of $.68 and $.40 reported in the comparable quarter of 2006.

EPS: 2006 $2.62, 2007 $2.82, 2008 $3.20; DVD: $1.30, YLD 2.3%

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

Altria (Dividend Growth Portfolio) reported second quarter earnings per share of $1.15 versus expectations of $1.13 and $1.28 recorded in last year’s second quarter. It also announced that it was acquiring an additional 30% (brings MO’s holding to 80%) of a Mexican tobacco company.

EPS: 2006 $5.70, 2007 $4.25, 2008 $4.50; DVD: $2.75, YLD 4.9%

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

Marshall and Ilsley (Dividend Growth Portfolio) reported second quarter operating earnings per share of $.84 versus expectations of $.85 and $.79 reported in 2006’s second quarter.

EPS: 2006 $3.22, 2007 $3.35, 2008 $3.55; DVD: $1.20, YLD 2.6%

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

Northern Trust (Dividend Growth Portfolio) reported second quarter earnings per share of $.92 versus estimates of $.88 and $.76 recorded in the comparable 2006 quarter.

EPS: 2006 $3.00, 2007 $3.40 2008 $3.75; DVD: $1.00, YLD 1.6%

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

Market Analysis

More Cash in Investors’ Hands

Bassell is buying Lyondell for $12 billion in cash.

Plains Exploration is acquiring Pogo Producing for $3.6 billion, 41% of which is in cash.

7/17/07

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.) Congress has finally found a bureaucracy whose budget they can cut; but you won’t believe which one. Well, maybe you will.

http://www.opinionjournal.com/diary/

Politics

Domestic

International War Against Radical Islam

The Market

Technical

Fundamental

This morning the Aggressive Growth Portfolio is buying additional shares of US Global Investors Gold Shares (USERX) taking that position to a 1 ½ sized holding. This basically reflects our continued unease with the domestic/international political environment along with rising oil and material prices and a weak dollar.

News on Stocks in Our Portfolios

A.J. Gallagher (High Yield Porfolio) is acquiring Spanjers Insurance Agency, a retail insurance broker.

EPS: 2006 $1.40, 2007 $1.75, 2008 $1.85; DVD: $1.24, YLD 4.3%

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

Coca Cola (Dividend Growth Portfolio) reported second quarter operating profits per share of $.85 versus expectations of $.82 and $.76 recorded in its 2006 second quarter.

EPS: 2006 $2.37, 2007 $2.60, 2008 $2.85; DVD: $1.36, YLD 2.6%

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

Johnson and Johnson (Dividend Growth Portfolio) reported second quarter operating earnings per share of $1.05 versus expectations of $1.00 and $.98 reported in the last year’s second quarter.

EPS: 2006 $3.76, 2007 $4.05, 2008 $4.35; DVD: $1.62, YLD 2.6%

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

US Bancorp (High Yield Portfolio) reported second quarter earnings per share of $.65 versus expectations of $.67 and $.66 recorded in the second quarter of 2006.

EPS: 2006 $2.61, 2007 $2.65, 2008 $2.85; DVD: $1.62, YLD 4.9%

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

Market Analysis

More Cash in Investors’ Hands

Dow Jones has tentatively agreed to be acquired for $5 billion in cash.

7/16/07

Economics

This month’s lead Fortune article on the global economy:

http://money.cnn.com/magazines/fortune/fortune_archive/2007/07/23/100134937/index.htm?section=money_latest

a rising tax and regulatory burden (Government has never proven that it could solve economic problems efficiently or satisfactorily.) The global economy booms as taxes fall:

http://www.usnews.com/blogs/capital-commerce/2007/7/13/global-economy-booms-as-taxes-fall.html

Politics

Domestic

International War Against Radical Islam

The Market

Technical

Fundamental

Investor sentiment is still cautious--which is bullish:

http://www.marketwatch.com/news/story/contrarians-believe-further-market-gains/story.aspx?guid=%7B9706AC13%2D8E21%2D48DB%2DAE1B%2D3B3A10C3F77F%7D

As you know, Magellan Midstream Partners was added to the High Yield Buy List last week. This is a master limited partnership that is involved with the transportation, storage and distribution of refined petroleum products in the US. Since its founding in 2001, the partnership has grown earnings from $.95 a share to $2.24 in 2006 and dividends from $1.01 in 2001 to $2.34 in 2006. While these growth rates will slow, they nevertheless should continue as the partnership expands its capacity as well as its products and services. Providing a current yield of 5.3% with the expectation of growing its dividend by 6-8% over the intermediate term, this investment provides an attractive total return.

EPS: 2006 $2.24, 2007 $2.40, 2008 $2.55; DVD: $2.46, YLD 5.3%

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

News on Stocks in Our Portfolios

Alcon Inc (Aggressive Growth Portfolio) is acquiring Wavelight AG, a developer and manufacturer of refractive laser and diagnostic systems used in eye surgery.

EPS: 2006 $4.35, 2007 $5.15, 2008 $5.90; DVD: $1.50, YLD 1.5%

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

An update on Graco (Dividend Growth Portfolio):

http://www.bloggingstocks.com/2007/07/15/graco-still-working-on-a-growth-strategy/

EPS: 2006 $2.17, 2007 $2.55, 2008 $2.90; DVD: $.68, YLD 1.6%

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

Market Analysis

More Cash in Investors’ Hands

IHOP is buying Applebee’s for $2.1 billion in cash.