I was reading more anecdotes from Ben Bernanke's 60 Minutes
appearance in which he discussed the Federal Reserve's ability to
easily control inflation and change course quickly on its recent
accommodative monetary policy.
We have seen the Fed raise interest rates in the past to control
the stock market's ramp, and when you turn back to the early 80′s
we saw the process tame runaway commodity prices. Fast-forward to
now and the playbook to stymie inflation is ready when needed. The
biggest question and fear this time is that countries like China
could come in and corner a valuable amount of needed commodities.
How do you control that scenario? That is a tough question to
answer, and one I hope the Federal Reserve gives a lot of thought
to. Remaining in super-power status is a bit harder when you have
run-away debt and China continuing to assert its buying power
because it just can. I don't mean to stray too far into politics,
but all the moves that the Fed contemplates can have a varied
affect on the companies we invest in, so it pays to keep a close
eye on the big picture at all times.
Speaking of inflation, I am keeping a closely monitoring gold
prices as we are seeing a bit of a sell-off today. Gold has backed
off making new highs once again. If the yellow metal keeps
struggling at these levels, the crowded trade could get a bit
sloppy with traders possibly looking to ring the register. Check
out more on Gold in this
video
.
Gold-mining plays Goldcorp (
GG
) and Newmont Mining (
NEM
) backed off this morning with gold prices getting hit. On the
earnings front, Men's Wearhouse (
MW
) and H&R Block (
HRB
) saw selling following both companies' results. Fortune Brands (
FO
) closed off earlier highs on news the company will be separating
into three companies. Wall Street loves the break-ups of companies
and we'll likely hear about more potential candidates that could
follow suit. Financials picked up steam in the afternoon, led by
PNC Financial (
PNC
) and Prudential (
PRU
). We added a couple of new dividend stock plays to our
"recommended" list earlier today, so be sure to check out the
post
if you did not read the e-mail alert we sent out earlier.
My new book, "Be a Dividend Millionaire" should be available
online in February 2011, with a traditional print version to follow
in May. We are working on a new site for the book, which will
contain key details on what you can find inside and how it can be
pre-ordered.
As always, check out our industry-leading
Best Dividend Stocks
list for the top dividend names to put money into right now.
Thanks for reading, and I'll see you tomorrow!
Be sure to visit our complete recommended list of the
Best Dividend Stocks
, as well as a detailed explanation of
our ratings system here
.