[youtube:http://www.youtube.com/watch?v=O17MA58P-QY 450 300]
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Newton says that a body in motion remains in motion unless acted upon by another force. Right now that treatise translates well into the action provided by our tentative bull market, perhaps best exemplified by the individual success of one CRAAPL, Inc.
Do I trust this momentum? Not for a minute, especially not with the struggles my belleweather precious metals stocks have been enduring — a precursor perhaps to the interest rate battles that loom on our horizon. Will I play the momentum, however? Of course I will, but with names that makes sense in the broader scale.
Right now, agricultural stocks are starting to make a stealth comeback… moreso those stocks who are largely designed to assist farmer’s yield. Why? I believe it’s because the farmer’s cost of capital has increased, despite our low interest rates, thanks to the ridiculous bull market in farm land prices. Just in Southwestern Indiana alone, farmland that sold for $2,500 to $3,000 an acre six or seven years back is now going for well over $10,000 an acre, and in some cases being sold at auction for $14,000 an acre. In places like Iowa, the values are coming in even higher.
All of that means that farmers need to increase yield value — even at $6.50 a bushel corn — in order to make a return. That bodes well for fertilizer companies like MOS and POT for example. These are two potential breakouts that are not quite ready for prime time, in my humble opinion.
Not so unready, however, is my MON-ster, which has been running nicely since the first of the year, and only recently experienced a pullback. I think it’s the pause that refreshes, and the next stop is breaking out of this consolidating triangle (on the weekly) to take out the top of this fibonacci retrace:
Your relatively low risk stop is pretty obvious on the above chart (below $77.00). Your upside is broad. In the bad old days, MON got as high as $154 a share. I think eventually it will leave even that number behind.
I think we can agree we are in a bull market– at least for the moment — even as we clamber up the Wall of Worry together, pitons digging for purchase, ropes securing us and sealing our collective fates should we drop. If we are going to take advantage, let’s go after the stocks that have been making sense this year without making a big drunken fuss about it like CRAAPL. That’s the ags, and I’ll have more on this subject.
Best to you all.
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wow i thought that song was from carribean cruise line ads, i didn’t realize it was orignially about a rusty industrial hellhole.
nice analysis of the ags, TNH has been excellent to me, I expect more.
You obviously were NOT in high school in the 80’s, like myself and fellow greats.
If you have Sirius, I recommend Channel 33, First Wave. Very similar to the Long Island Station WLIR back during the New Wave entree into America.
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I hate to admit but I was also in high school in the 80’s and whenever i have access to sat radio (rent cars) i love to listen to first wave.
What’s the link between MON and manchester?
stone roses re-united, who’s going?
No connection, I just wanted to feature that song and Dream Academy (and Joy Division) are from Manchester.
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As are The Smiths, The Fall, Chameleons, James, Charlatans, Inspiral Carpets, and the Happy Mondays. Don’t forget Oasis and the fore-mentioned Stone Roses.
The 80s (and into the early 90s) were a brilliant time to be cutting your teeth musically.
CVM making me feel all warm and fuzzy this morning.
That’s what the crack addict said after taking a long drag.
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Leave Whitney out of this!
Where is her baftub anyway?
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He’s prolly hanging with Chuck Sheen.
Guess how much i’m up on my CVM?
(hint, up less than 2% before today’s open)
dont worry CH,i b’s heah, a soaking a bit. yall need a baf
I have not trusted precious metals for holding overnight for a couple weeks. Even intraday, its unpredictable.
Agreud. You just have to grow armadillo skin.
You’ll be alright if you just remember… “long term is up.”
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i’d rather hold exk long term,than holdin my wnr. you needs a baf to.
your land price comments, are all about farm tax policy. farmers can reinvest profits in land or equipment for immediate write-offs. so if they have other sources of income like many big land owners do, they can perpetually keep buying more land each year rather than pay taxes. seems ridiculous. but one big land owner told me that is exactly what they were doing. obviously the new land isn’t as profitable as the purchases five years ago, but would you rather have more land or have paid taxes?
the small farmer will disappear under this policy, because he needs to eat and pay some taxes on his profits.
I know a lot of farmers thanks to a deal I’m working on. Some are small, some are large, but they would mostly be categorized as “independents.”
They are, to a man (or woman), rich as phuck-all, these days.
And I’ve noted your tax writeoff strategy as well… another thing they can write off, with new purchases every year? Farm EQUIPMENT.
Hello DE, CNH, AGCO, TITN, CAT?
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yes, farm equipement. you can add FTT.TO if you like the tsx names. and don’t forget F.
I’ve finally come up for air and the first thing i see is you, once again, jealously besmirching the grand dame, aapl. For shame 😉
I did dig back through your old posts this morning (to figure out what the hell happened to my jacksonians these past few dark weeks. Jeebus.) and saw your nice post about my little bemelmans. Mrs #6 and I were both a bit verklempt after seeing it. Merci beaucoup. Can’t wait for you guys to meet her.
I am hoping, for Bemelman’s sake, you are hedging your CRAAPL at $6 hunnit.
No tree grows to the sky.
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haven’t sold a share since $58. But I might have to start thinking about it now I guess. Jacadi ain’t cheap!
Neither are diapers…
Especially not the way mine blows through them. How something so small could go through so many is amazing.
I’m right there with you. Mine was born mid Feb. She is almost at size 1. As soon as that hits I’m having my wife go to Amazon and buy buy buy.
worst is when you just change them and they have a little residual that finds the day of light. The thought “it’s just a little bit” frequents my head, however I remember that I want to teach her to “do the right thing” and end up with another change… sigh…
oh, there have been plenty of “aah, that’s not so bad. I’ll change it next time.”
You like RGLD down here Monsieur Gint?
I do.
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With all due respect…why are you still carping on AAPL? It’s on an incredible run, you missed it and you’re grousing??? That is beneath you…at least hate on CMG and PCLN…explain those to me!
It’s a family joke, relax.
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Ha…that’s funny you mention SW IN. That’s where I am and I own over 600 acres of prime farm land in the area. Bought it in 2007 as an investment. I lease 95% of it out to local famers who grow corn and soybean with it. I was just offered significantly more than what I paid for it by a local guy, but turned down the offer.
JG – Any thoughts on MOO as a hands off ag holding? Seems to capture all the big guys in one friendly little package.
thks