One of the vulnerabilities in today’s market is that profit margins are near peaks. Investors tend to like companies with fat profit margins, but high profit margins are like honey pots that attract competitors. They are rarely sustainable for long. But what is more important for stock prices is not the profit margin itself, but the direction they move.
June 20th, 2011 | Chris Mayer | 0 comments | ContinuedArchive for Chris Mayer
Chris Mayer is a veteran of the banking industry, specifically in the area of corporate lending. A financial writer since 1998, Mr. Mayer's essays have appeared in a wide variety of publications, from the Mises.org Daily Article series to here in The Daily Reckoning. He is the editor of Mayer's Special Situations and Capital and Crisis - formerly the Fleet Street Letter.
Hidden Profits from These Forgotten Treasures
In the 1850s, hardy Russian explorers and fur trappers traipsing about mountain ranges and sea passages noted oil seeps around what we call Cook Inlet today. These are the earliest historical references to the oil in Alaska. Over the next hundred years, a variety of fortune-seekers – lone prospectors, private wildcatters and big oil companies – took shots looking for commercial oil here.
June 17th, 2011 | Chris Mayer | 0 comments | Continued
Blue Gold…Still Shining
About five years ago, I launched my investment service, Mayer’s Special Situations with a special report, entitled Blue Gold. The report laid out the compelling long-term case for investing in water-related stocks. The stocks I recommended in that report have performed extremely well, far outpacing the S&P 500 Index.
June 15th, 2011 | Chris Mayer | 0 comments | Continued
Buy Gold…or Farmland
My friend Brad Farquhar is the co-founder of Assiniboia Capital in Saskatchewan, which invests in farmland there, among other things. He sends the following note: “Farm Credit Canada, the biggest ag lender in Canada, publishes a province-by-province report on movements in farmland prices in Canada every six months.
June 14th, 2011 | Chris Mayer | 0 comments | Continued
Liquefied Natural Gas Goes Boom!
Even before the Tohoku earthquake and tsunami reminded the world that nuclear power is not risk-free, the liquefied natural gas (LNG) market was booming in Japan. In fact, the LNG market has been booming throughout Asia for the last several years. That’s good news for Australia…and for a variety of companies that serve the LNG industry.
June 1st, 2011 | Chris Mayer | 0 comments | Continued
An Unstoppable Trend – Three Ways to Play it
A few months ago, I hopped on a train to NYC to check out Gabelli’s 16th Annual Aircraft Supplier Conference. I find these conferences are a great way to learn a lot about the leading companies in an industry in a short amount of time. Among the 14 companies presenting were some industry heavyweights like Honeywell and Boeing.
May 27th, 2011 | Chris Mayer | 0 comments | Continued
The Saudi Arabia of Coal
Last year, something important happened in the coal markets. China actually imported coal for the first time. As recently as 2001, China exported 90 million tonnes. But in 2009, China imported around 86 million tonnes. That’s a huge shift in less than a decade.
May 26th, 2011 | Chris Mayer | 0 comments | Continued
“There’s Always Something to Do”
He may be the best investor you’ve never heard of. Beginning in 1975, he delivered to his investors a compound annual return of 15.2% for the next 33 years! If you’d put $10,000 with him and left it there, you’d have had $1 million by 2007.
May 10th, 2011 | Chris Mayer | 3 comments | Continued
The Sinking of QE2
You’ll recall that QE2 — the fancy name for the Fed’s market manipulations — ends June 30. There is no particular reason why that date should be anything special. It’s the official end of QE2. But the market will likely anticipate the end of QE2 before it actually ends.
May 6th, 2011 | Chris Mayer | 0 comments | Continued
The Rising Tide of Resource Nationalism
You know the old film The Treasure of the Sierra Madre? Three men set off into the hinterlands of Mexico to strike gold. They find it, but then greed sets in and they start to mistrust each other. Things go badly from there.
May 3rd, 2011 | Chris Mayer | 0 comments | Continued
The Milkman Indicator
Our family has a milkman. Yes, a milkman, just like in the old days. He comes every Friday and drops off a crate full of cold bottles of milk, along with tubs of yogurt and butter, cheeses and sometimes meats.
April 29th, 2011 | Chris Mayer | 3 comments | Continued
Is There Any Hope for Shipping?
“Many shall be restored that now are fallen and many shall fall that now are in honor.” This quotation from the Roman poet Horace is spot on in describing the ebb and flow of markets. No wonder it appears as an introduction to Security Analysis, that investing classic by Ben Graham and David Dodd.
April 21st, 2011 | Chris Mayer | 1 comment | Continued
The Story of Timothy Bancroft
Let me tell you the story of Timothy Bancroft. It’s a good one, and if you haven’t heard it, I think you’ll like it. Bancroft was a smart and shrewd investor. He dodged the Panic of 1857, which he said was due to “easy money policies” and “overconfident speculation in the railroads and farmlands of the Western states.”
April 19th, 2011 | Chris Mayer | 0 comments | Continued
Cash on Hand…An Investors’ Best Friend
Warren Buffett’s annual letter to shareholders came out recently. This is probably one of the most anticipated shareholder letters in the financial world. Everyone wants to know what the Oracle’s take on the world is.
April 5th, 2011 | Chris Mayer | 0 comments | Continued
Welcome to Colombia!
“Would you invest in Brazil 15 years ago if you had the chance?” our Colombian host asked me one night, in an effort to frame the opportunity here. “Of course, that would’ve been a home run,” I said. “Welcome to Colombia.”
April 1st, 2011 | Chris Mayer | 1 comment | Continued
