Care for some late August fireworks? Well you came to the right
place as far as the stock market is concerned. We witnessed the
markets open strongly higher, only to drop on comments from Federal
Reserve chairman Ben Bernanke from the Jackson Hole Summit, but
then bounce right back up.
It's no secret that trading volume has been extremely light. and
pre-Labor Day week is a notorious slow one anyway. On that note,
don't forget the markets are closed this Monday.
One of the areas moving higher in today's action were
gold-mining plays, as hope of further money printing keyed moves
higher for stocks such as Newmont Mining (
), Barrick Gold (
), and Silver Wheaton Corp (
). Corning (
) shares were also up following a Wall Street analyst upgrade. As
far as everyone's favorite name to watch, Apple (
) shares have given up much of the early week's pop following their
patent victory over Samsung.
We added a new name to our recommended list today, so be sure to
if you missed the alert we sent out earlier.
The Thing About Cheating
I'm seeing lots of buzz surrounding yesterday's news about a big
cheating investigation at Harvard University. It looks like
numerous students (as in over 100) may have cheated on a take-home
exam. Cheating in schools has been around forever, regardless of
how distinguished a school may be.
This development is not a surprise, but the sad part in my eyes
is that many cheaters simply get away with it. Students can then
carry their cheating ways into other aspects of their lives. They
might later cheat on their resumes, their spouses, and many other
aspects of their lives.
I look at this sort of behavior as a runaway train that will
eventually derail at some point. The only question is how severe
the damage will be when the schemes come tumbling down. It's really
no different from the behavior of a momentum trader that gets away
with some wild trading, like buying a stock they like as it keeps
dropping, with the certainty that it will bounce right back up and
then they can cash out. What they don't realize is that the one
time this scenario doesn't play out as expected, they'll likely
wind up watching all their profits vanish with just one bad
You can cheat your way through a lot of things in life, and
maybe even suffer little consequences. But I guarantee sooner or
later, the odds of sneaking through will decrease dramatically.
Slow and steady is really the way to go - as long as you don't mind
waiting your proper turn for success. Cut in line and you'll only
speed up your unfortunate date with destiny.
Even Worse Than Cheating
We like to monitor Wall Street analyst calls each day, and lo
and behold, Facebook (
) today was the subject of a couple of downgrades/estimate cuts.
The stock almost no Wall Street analyst saw anything wrong with at
the time of the IPO (just a few months ago), is now the subject of
much Wall Street criticism. It's really ironic, now that the stock
is getting closer to a reasonable valuation (from a
Price-to-Earnings standpoint), that Wall Street starts to hate it.
How comical is that? Not very, for those who bought the initial
Now don't get me wrong, I'm not recommending FB shares for
anyone. The reality is simply that the stock should have never came
public at the valuation it did. Now the stock has to deal with a
boatload of shares that are being released post-IPO. Somehow,
nobody had the foresight to see this being an issue?
Here in the Dividend.com Newsletter, we warned investors against
the Facebook IPO. We were very clear about the potential dangers.
The point isn't to say "we told you so," but rather to weigh the
risk/reward any time you think about rolling the dice outside the
non-dividend world. The last thing you want to do is give back all
the gains you have made through the power of compound interest,
compliments of your dividend stock portfolio.
Beat The Markets with Dividend Stocks
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A Look to Next Week and a Weekend Preview
Looking ahead to next week, with the markets being closed on
Monday for Labor Day, third quarter earnings will continue to be
very light. The focus will likely be on the economic data as well
as the latest Wall Street analyst calls.
Be sure to visit our complete recommended list of the
Best Dividend Stocks
, as well as a detailed explanation of
our ratings system here