2018: Year of Great Opportunities and Traps For Investors

The year 2017 has been stellar for stock market investors. Interestingly, most of the rise has been caused by enthusiasm about the future.

The large reductions in the governmental regulations, hopes that there will be more in the future, hopes that tax cuts will be substantial and fuel future economic growth, and hopes that the efforts of the far left to derail the president’s growth agenda will fail, have all led to the rise in optimism among investors.

Wall Street firms have just issued their forecasts for the stock market in 2018. The forecasts seem to be looking for 10%–15%

Beware: “Sentiment” is Not an Exact Market-Timing Tool

For the past several months, we have heard many top hedge fund and other analysts voicing their concern about the markets, with some forecasting a crash or at least a sharp plunge because of overvaluations.

Former hedge fund manager Jim Rogers, now residing in Asia, told Business Insider that the greatest crash of our lifetime will happen “later this year or next.” He says, “Be worried.”

Another well-known analyst, Marc Faber, told CNBC that he sees a plummet of 40% or more, and “it will end very badly, extremely badly.” He didn’t say when.

Analyst David Stockman, former budget director for

By |November 29th, 2017|Tags: , , , , , |

The Great Oil Short Squeeze

As you know, the oil industry has been in a severe depression since 2014. Oil prices plummeted from over $100/barrel all the way down to $30/barrel. Today, that figure hovers around $50 and is showing little signs of returning back to the $100 level any time soon. As bullish speculators continue to get burned by “demand is finally back” or “supply is finally falling,” more and more oil giants fall on serious hard times.

Will Tax Bill Produce a Real Estate Debacle, or is a Boom Ahead?

Lately at Dohmen Capital, we are seeing how the Real Estate market now is somewhat reminiscent of the environment leading up to the Great Financial Crisis of 2008. However, we must keep in mind that there was a roughly two year lead time between the first signals of excesses and the crash of 2008.

Between 2008- 2009, many investors were burned, with the estimated losses equaling over 20 trillion U.S dollars.

Time To Punish Slander And Fake News in the U.S.

Germany is proposing legislation to combat the avalanche of fake “news” by imposing heavy fines on media outlets that disseminate slanderous and defamatory material while doing nothing to try to prevent the publishing of such falsehoods. It would be the opposite of U.S. law, which basically gives immunity to the media outlets that post or carry such often malicious articles.

According to the New York Timesmajor social media firms like Facebook and Twitter may be faced with huge fines, up to $53 million, if they don’t comply with a newly proposed law by Germany’s minister of justice and

How A Big Hedge Fund Ace Lost 95%

One of the biggest hedge fund managers, Bill Ackman, considered to be one of brightest, lost over 95% in one of his largest positions, Valeant Pharmaceuticals (VRX).

He held the stock for about 3 years, while the stock plunged from $257 to $11 on March 14, 2017. On March 13, he declared he had sold his entire position in Valeant.

The ‘Death Of Coal’ Was Premature

President Obama promised in 2007 that his policies would “bankrupt the US coal industry.” This was one promise that was kept.

A study found the coal industry lost 50,000 jobs from 2008 to 2012. That’s a lot of misery for those families. Many leading coal companies went bankrupt.

Dohmen Capital presents the chart below for KOL, the ETF for coal companies. The ETF lost 90% of its value from the 2011 peak.

Retail Bulls Get Slaughtered

The bulls in the retail sector over the past year got another disappointment with weak sales during the holiday season. As we recently pointed out to our Dohmen Capital clients, Wall Street analysts were bullish on retail late last year, predicting that Christmas sales would be strong. The election results produced further optimism, saying that the prospects of the new President will encourage consumers to spend more.

If the world were only that simple! To spend more, people need more income, which has been declining for several decades. They need jobs, which right now is not happening except in

Samsung Catches Fire While Apple Sales Disappoint

Apple may not have their phones burning up, but they have other problems, such as disappointing sales of the iPhone 7, so poor that for the first time, they didn’t even release first week sales.

At Dohmen Capital Research, we see that Apple’s US Mac sales are also plunging, down 13.2% from one year ago. This is not a big part of total Apple sales, but it adds up when all the other “great hopes,” such as the Apple Watch, Apple Pay, Apple TV, etc. have fizzled.

Is the Inevitable Debt Collapse Predictable?

The national debt is accelerating at a geometric rate. But no one in Washington seems to notice. “Geometric” rate means it is accelerating exponentially.

Have you noticed that current members of Congress never mention the horrendous explosion in the nation’s debt? Apparently, they hope that Americans won’t notice what they have done to our economic future.