Friday, June 23, 2006


Some folks who have "joined" our investment group have not yet funded or fully funded their account. They should not cry out loud when they miss the big market move. I will use my favorite investment again to illustrate what is happening in certain sectors. International airfares are at 6 year highs and will soon be at 20 year highs. Traffic is at all time record highs. Record traffic times record fares will lead to record profits. Not this quarter and not next but in the near future.

If I am correct, the pressures being exerted by the central banks of the world are going to pop the commodities price bubble (including the price of oil) without causing a severe economic slow down. The trend toward a global economy is just getting started. The net result could be a decline in cost to the airlines of 100's of millions of dollars per year, without a decline in revenues!

The retail brokerage firms can no longer ignore the earnings power. Two more firms jumped on the band wagon this week.

A regular reader wrote that he likes the moves made by GT to lower costs, he likes the broad based earnings power of ORCL and he believed Corning is ripe for accelerating business in the fiber cable sector. I agree on all counts. Notice that these are all business service plays. The moves by GT were to eliminate consumer brands, the expansion of ORCL is all business and the projected strength in Corning is a shift away from primarily consumer flat panel screens (though this business will do well as business demand grows) and to the fiber cable business that is sold to telecom and cable TV firms.

The old saw tells the whole story, "Invest when there is more money than fools and sell when there are more fools than money". Corporations have so much cash in hand that mergers and buybacks continue to set records; this mornings action was in the buy out of two oil companies. A few years ago, stocks were "the" water cooler topic. Last year, it was beach property. Next year it will be stocks again. BUY NOW! To join our investment group
write me