Real World Politics Meets Real World Investing

Real World Politics Meets Real World Investing

This is the time of year when you start to see investment ideas based on predictions of the US Presidential Election. There are lists of stocks that should or could go up under a Republican administration and a companion list of companies that are
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The Benefits Of Growth Investing – Minyanville

The Benefits Of Growth Investing – Minyanville

Getting solid, above-average growth over the long term is a painstaking process, but it's well worth the effort.
www.minyanville.com/trading-and…/yum…/45602?…

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Your Questions About Invest In Gold And Silver

Donald asks…

With 40k would you invest in real estate or gold and silver?

What is the best way to spend 40k?

Justin answers:

Gold and Silver are too speculative. Over last 10 years they have appreciated nicely so many people have come to believe that they are safe. However we need to keep in mind that Gold touched a high of $900/Oz in 1980 and and then over next 23 years constantly kept going down in value and reached a low of $270!!! Can one imagine to wait that long and take 75% loss in value? See the chart here. Click or copy and paste:
http://www.futuresbuzz.com/gc.bmp

Same goes for silver. It touched a high price of $40 in 1980 and for people who invested at that price saw price hover around $5 or so over next 25 years!!
Http://www.futuresbuzz.com/si.bmp

There is no guarantee that the same thing can’t happen again in those two commodities. Actually chances are it will repeat in my opinion.

So, out of the 3- Gold, silver and Real Estate-, Real Estate is the best choice. It also offers very nice income these days particularly when interest rates are low.

Steven asks…

What company is the best to invest in right now?

What company do you think will do well within the next few months in the stock market? What company would be my best bet investing a few hundred in?

Justin answers:

Silver stocks. Down historically. The only way to go is up up up. After elections will be the time the Plunge Protection Team(PPT) gives up on trying to manipulate precious metals markets down to hide inflation/weak dollar.

I’m liking C’ouer D’alene and i’ve put my money where my mouth is. (stock symbol CDE) Also Yamana Gold (AUY)

David asks…

Is it a good ideal to buy silver bullion?

I been thinking of buying silver billions.just don’t know when would it bee a good time.or should I just keep my money?

Justin answers:

Many financial experts, including Howard Ruff, suggest buying silver right now because it’s still not in line with it’s historical relationship with gold. Check out this article from his blog. Http://blog.nineyearmortgage.com/invest-in-silver/

Joseph asks…

Is silver a better investment than gold?

I’m gonna be working this summer and I am also planning on putting most of my money towards investments. Are silver and gold good investments that will make me more money, or are there any other options.

Justin answers:

Have a bag of junk silver lying around, as protection against total financial collapse, and invest in companies that dominant their markets and pay consistent dividends for the long run.

Ken asks…

what are the first steps of local economic recovery?

How can poor people prepare for currency collapses when they don’t have money to buy gold or silver?

Justin answers:

Stay away from gold and other precious metals that have already skyrocketed in terms of price. Poor people need to do what all other people do to ensure a positive future. Spend less and save more! Don’t chase investments that are already inflated either. People have a natural tendency to want to buy something that is already had a good run because they think it will go higher. Gold is at all time highs still and there isn’t much reason to think its going to continue this run much higher. Find a good stock and invest in it. Many are trading at low P/E ratios and there is a good opportunity to make money. Have a buy price is mind and a sell price. Put in a stop loss order to prevent a big market swing from killing you. Follow this advice and you should do fine.

Daniel asks…

Im wanting to Make silver wire jewelry that is melted together in places.?

I was given a roll of silver wire since I’ve recently started jewelry making. I want to be able to soften or melt the wire in places and connect it to the other jewelry pieces. Is that an option w a torch? What else would I need? And what are some good steps to try? Would another metal work better? Something that wouldn’t turn your skin green though…. Any suggestions nice comments would be great!

Justin answers:

You’ll need an annealing torch and you’ll need silver solder. The annealing torch will soften the metal and make it easier to work with, but to make the metal stick together you should use silver solder. Solder can be used with either the torch or with a jeweler’s soldering iron with a fine tip. Don’t buy from an electronics store -invest in a proper jewelers torch and jeweler’s soldering iron. I prefer the torch. I thought the iron would be easier but it wasn’t. Gold is slightly easier to work with than silver -but far more expensive. For small joins I like silver paste -it has the flux and silver pre-mixed so there’s no guessing and you can use only what you need. There’s less mess to clean up. You can also buy soldering wire and you must use flux so the silver jewelry component and the solder will mix and meld.

There’s lots on line about using silver wire, annealing, soldering and more. There’s a steep learning curve -you won’t be making designer quality jewelry overnight. Be prepared to spend some time experimenting and learning the technique. Use safety equipment such as glasses and gloves. Practice safe torching and soldering -both are tools that can burn your house down if used unsafely. Keep a working fire extinguisher close by and don’t even think of working on a wood or laminate surface!

Here are a few simple resources to start, you will need to do lots of independent reading and practicing: http://www.instructables.com/id/How-to-solder-for-Jewelry-purposes/
http://jewelrymaking.about.com/od/howtosolderjewelry/ss/021708.htm
http://www.wire-sculpture.com/jewelry-making-blog/113/soldering-101/
http://jewelrymaking.about.com/od/solderinginformation/a/080626.htm

Robert asks…

Best way to invest over the long term?

I have 80k that I have to invest/lock in until hit retirement age of 55. I have not yet sat down with a broker or financial advisor. I reside in Canada and primarily deal with td Canada trust. I was wondering what I should invest in over the long term to get the greatest return. What would be a safe estimate on return in twenty years? Your opinions are appreciated.

Justin answers:

Investment in gold is a best way to get much more profit then investment, day by day cost of gold rising up, i am sure over the long term you’ll get greatest return. For more information about gold and silver investment Contact Us at 1-877-448-5766 for your free consultation.

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Your Questions About Stocks And Bonds 101

Mark asks…

Accounting question !?

1.Under the equity method, the receipt of cash dividends on an investment in common stock of Vallerio Corporation is accounted for as a debit to Cash and a credit to
a. Investment in Vallerio
b.Retained Earnings
c.Dividend Revenue
d.Dividend Receivables

2.Companies may report comprehensive income on each of the statements below except
a.income statement
b.separate statement of comprehensive income
c.statement of stockholders’ equity
d.retained earnings statement

3.Bonds Payable has a balance of $1,000,000 and Premium on Bonds Payable has a balance of $7,000. If the issuing corporation redeems the bonds at 101, what is the amount of gain or loss on redemption?
a. $3,000 loss
b.$3,000 gain
c.$7,000 loss
d.$7,000 gain

4.One potential advantage of financing corporations through the use of bonds rather than common stock is
a.the interest on bonds must be paid when due
b.the corporation must pay the bonds at maturity
c.the interest expense is deductible for tax purposes by the corporation
d.a higher earnings per share is guaranteed for existing common shareholders

5.Free cash flow is cash from operations, less cash for
a.dividends and cash for fixed assets needed to maintain productivity
b.dividends and cash to redeem bonds payable
c.fixed assets needed to maintain productivity
d.dividends, cash for fixed assets needed to maintain productivity, and cash to redeem bonds payable

financi4 answers:

I started to do your quiz for you, but then i remembered i havent taken an accounting class in over 3 years so i just gave up so as to not embarrass myself.

Michael asks…

Accounting help 10 pts!!!!!!!?

1.Under the equity method, the receipt of cash dividends on an investment in common stock of Vallerio Corporation is accounted for as a debit to Cash and a credit to
a. Investment in Vallerio
b.Retained Earnings
c.Dividend Revenue
d.Dividend Receivables

2.Companies may report comprehensive income on each of the statements below except
a.income statement
b.separate statement of comprehensive income
c.statement of stockholders’ equity
d.retained earnings statement

3.Bonds Payable has a balance of $1,000,000 and Premium on Bonds Payable has a balance of $7,000. If the issuing corporation redeems the bonds at 101, what is the amount of gain or loss on redemption?
a. $3,000 loss
b.$3,000 gain
c.$7,000 loss
d.$7,000 gain

4.One potential advantage of financing corporations through the use of bonds rather than common stock is
a.the interest on bonds must be paid when due
b.the corporation must pay the bonds at maturity
c.the interest expense is deductible for tax purposes by the corporation
d.a higher earnings per share is guaranteed for existing common shareholders

5.Free cash flow is cash from operations, less cash for
a.dividends and cash for fixed assets needed to maintain productivity
b.dividends and cash to redeem bonds payable
c.fixed assets needed to maintain productivity
d.dividends, cash for fixed assets needed to maintain productivity, and cash to redeem bonds payable

financi4 answers:

1.Under the equity method, the receipt of cash dividends on an investment in common stock of Vallerio Corporation is accounted for as a debit to Cash and a credit to
a. Investment in Vallerio

2.Companies may report comprehensive income on each of the statements below except
d.retained earnings statement

3.Bonds Payable has a balance of $1,000,000 and Premium on Bonds Payable has a balance of $7,000. If the issuing corporation redeems the bonds at 101, what is the amount of gain or loss on redemption?
A. $3,000 loss

4.One potential advantage of financing corporations through the use of bonds rather than common stock is
c.the interest expense is deductible for tax purposes by the corporation

5.Free cash flow is cash from operations, less cash for
a.dividends and cash for fixed assets needed to maintain productivity

David asks…

Accounting help fast!?

Accounting help 10 pts!!!!!!!?
1.Under the equity method, the receipt of cash dividends on an investment in common stock of Vallerio Corporation is accounted for as a debit to Cash and a credit to
a. Investment in Vallerio
b.Retained Earnings
c.Dividend Revenue
d.Dividend Receivables

2.Companies may report comprehensive income on each of the statements below except
a.income statement
b.separate statement of comprehensive income
c.statement of stockholders’ equity
d.retained earnings statement

3.Bonds Payable has a balance of $1,000,000 and Premium on Bonds Payable has a balance of $7,000. If the issuing corporation redeems the bonds at 101, what is the amount of gain or loss on redemption?
a. $3,000 loss
b.$3,000 gain
c.$7,000 loss
d.$7,000 gain

4.One potential advantage of financing corporations through the use of bonds rather than common stock is
a.the interest on bonds must be paid when due
b.the corporation must pay the bonds at maturity
c.the interest expense is deductible for tax purposes by the corporation
d.a higher earnings per share is guaranteed for existing common shareholders

5.Free cash flow is cash from operations, less cash for
a.dividends and cash for fixed assets needed to maintain productivity
b.dividends and cash to redeem bonds payable
c.fixed assets needed to maintain productivity
d.dividends, cash for fixed assets needed to maintain productivity, and cash to redeem bonds payable

financi4 answers:

1. C.
2. C.
3. A.
4. C.
5. C.
In corporate finance, free cash flow (FCF) is a cash flow available for distribution among all the security holders of a company. They include equity holders, debt holders, preferred stock holders, convertible security holders, and so on.

Chris asks…

Accounting question help fast !?

1.Under the equity method, the receipt of cash dividends on an investment in common stock of Vallerio Corporation is accounted for as a debit to Cash and a credit to
a. Investment in Vallerio
b.Retained Earnings
c.Dividend Revenue
d.Dividend Receivables

2.Companies may report comprehensive income on each of the statements below except
a.income statement
b.separate statement of comprehensive income
c.statement of stockholders’ equity
d.retained earnings statement

3.Bonds Payable has a balance of $1,000,000 and Premium on Bonds Payable has a balance of $7,000. If the issuing corporation redeems the bonds at 101, what is the amount of gain or loss on redemption?
a. $3,000 loss
b.$3,000 gain
c.$7,000 loss
d.$7,000 gain

4.One potential advantage of financing corporations through the use of bonds rather than common stock is
a.the interest on bonds must be paid when due
b.the corporation must pay the bonds at maturity
c.the interest expense is deductible for tax purposes by the corporation
d.a higher earnings per share is guaranteed for existing common shareholders

5.Free cash flow is cash from operations, less cash for
a.dividends and cash for fixed assets needed to maintain productivity
b.dividends and cash to redeem bonds payable
c.fixed assets needed to maintain productivity
d.dividends, cash for fixed assets needed to maintain productivity, and cash to redeem bonds payable

financi4 answers:

1. A
2. D
3. A
4. C
5. C

James asks…

Accounting help fast 10 pts!?

1.Under the equity method, the receipt of cash dividends on an investment in common stock of Vallerio Corporation is accounted for as a debit to Cash and a credit to
a. Investment in Vallerio
b.Retained Earnings
c.Dividend Revenue
d.Dividend Receivables

2.Companies may report comprehensive income on each of the statements below except
a.income statement
b.separate statement of comprehensive income
c.statement of stockholders’ equity
d.retained earnings statement

3.Bonds Payable has a balance of $1,000,000 and Premium on Bonds Payable has a balance of $7,000. If the issuing corporation redeems the bonds at 101, what is the amount of gain or loss on redemption?
a. $3,000 loss
b.$3,000 gain
c.$7,000 loss
d.$7,000 gain

4.One potential advantage of financing corporations through the use of bonds rather than common stock is
a.the interest on bonds must be paid when due
b.the corporation must pay the bonds at maturity
c.the interest expense is deductible for tax purposes by the corporation
d.a higher earnings per share is guaranteed for existing common shareholders

5.Free cash flow is cash from operations, less cash for
a.dividends and cash for fixed assets needed to maintain productivity
b.dividends and cash to redeem bonds payable
c.fixed assets needed to maintain productivity
d.dividends, cash for fixed assets needed to maintain productivity, and cash to redeem bonds payable

financi4 answers:

1. A
2. D
3. A
4. C
5. C

Robert asks…

accounting 101 quick help!?

i’ve been struggling on this exercise for awhile. I put the answer in parenthesis next to the question, did i get them right?

Classify each of these transactions by the type of cash flow activity ( operating, investing, or financing)

1.) issued $200,000 of bonds payable (Financing)
2.) Paid utilities expense (Investing)
3.) Issued 500 shares of preferred stock for $45,000 (Financing)
4.) Sold land and a building for $250,000 (Investing)
5.)Lent $30,000 to Dead End Corporations,recieving Dead End’s 1-year, 12% note. (operating)

financi4 answers:

2 and 5 are incorrect.
Since #2 involves the day-to-day business activity and is related to the revenues and expenses on the income statement, it is an operating activity.

Since #5 involves lending money, it is an investing activity.

Richard asks…

IFRS VS GAAP Accounting?

1. Candy Company owns only one building that cost $700,000. At December 31, 2008, the remaining useful life of the building is 30 years; the accumulated depreciation on the building is $200,000 so its carrying value is $500,000. Candy Company wishes to revalue the building on the December 31, 2008 balance sheet. The fair value is currently $900,000.
a) Prepare the necessary journal entry to carry the building at fair value. Assume Candy Company accounts for accumulated depreciation by eliminating the accumulated depreciation against the gross carrying amount of the asset and restating the net amount to the revalued amount of the asset.
b) What is the depreciation charge on the building in 2009? After this entry is recorded what are the amounts in the Building and the Accumulated Depreciation- Building accounts.
c) Assume the entry in (b) was posted. At December 31, 2009, Candy estimates that the fair value of the building is now $850,000. What is the amount of the adjustment for the change in fair value? Prepare the journal entry to record this adjustment.
2. New Drugs, Inc., an international corporation, has identified a list of expenditures it believes to be intangible assets.
i. Research on potential pharmaceutical formulas
ii. Development of new pharmaceutical formulas, after feasibility and business plans have been established
iii. Legal fees to patent the newly developed formula
iv. Customer list purchased from a competitor xz
v. Patent purchased from a competitor
vi. Legal fees to defend the purchased patent
vii. Goodwill included in the purchase of Old Drugs, Inc.
viii. Internally developed customer list

a) Which items would be recognized as assets under US GAAP? Which items would be capitalized under IFRS?
b) Which item would not be recognized as an asset under US GAAP or IFRS?
c) Which item would be capitalized under IFRS but not US GAAP?

3. During 2007, a company began researching and developing a new product for market. By June 30, 2008, the company had determined the new product was technologically feasible and developed a business plan includin5g identification of a ready market for the product, and a commitment of resources to ready the product for market. The company has tracked costs of the product as follows:
·Research and development, Jan-June 2008 € 130,000
·Research and development, July-Dec 2008 80,000
·Training costs 15,000
·Legal fees – patent 20,000
·Mass production 120,000
·Marketing launch 75,000
a)What amount will be included in intangible assets on the company’s December 31, 2008 financial statements prepared in accordance with IFRS?
b) What amount will be reported as intangible assets under US GAAP?

4. Waldrop Airline entered into an agreement to lease equipment from Wilson Company.
a) In each scenario below, identify whether Waldrop would classify the lease as an operating or finance lease under IAS 17.
b) Next, indicate whether the lease would be classified as operating or capital under FASB Statement No. 13.
i. At the end of the lease term, ownership of the equipment will be transferred to Waldrop Airline.
ii. The fair market value of the equipment is expected to be $100,000 at the end of the lease term. Waldrop has the option to buy the equipment at the conclusion of the lease for $20,000.
iii. The equipment has a useful life of 10 years and the term of the lease is 7 years.
iv. The present value of minimum lease payments is $22,300 and the fair value of the leased equipment is $25,000.

5. Vidalia Corp issued €20 million of convertible bonds at 101. The bond is a five-year issue with interest payable annually at a nominal interest rate of 4%. Each bond has a face value of €1,000 and is convertible at any time up to maturity in to 250 ordinary shares. At the date of issue, the prevailing rate for similar debt without convertible options is 6% and the fair value of Vidalia Corp stock is €3.
a) What is the price of similar €20 million non-convertible bonds
b) How will the issue of the convertible bonds be recorded for IFRS?
c) How will the issue of the convertible bonds be recorded for US GAAP?

financi4 answers:

Is this for your hw assignment or CPA exam?

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Your Questions About Stocks And Bonds

David asks…

How long would I need to invest in stocks, bonds, and mutual funds before I see any earnings?

I just started getting interested in stocks, bonds, mutual funds, etc… and I want to know how long before I will see any earnings off my investments? I want to invest at least $2000 and would like to gain enough to open up a business. Would I have to wait a month? 6 months? 1 year? 5 years? Exactly how long? Thanks.
I need maybe 20-25 thousand to open the business.

financi4 answers:

You can see profits or losses immediately but a good decent amount of gains will need about a year to happen.

Steven asks…

What stocks, bonds, and mutual funds do you think will gain value in 40 years?

Have to write and essay and I need a list of stocks, bonds and/or mutual bonds that you think might increase in value in the next 40 years.

financi4 answers:

The chances are over 99% that stocks, mutual funds and bonds will have a return similar to their average. 40 years is a fairly long time so the variance or standard deviation won’t be too large. Only companies that go bankrupt or decrease sales and income will falter. You can also look at historical graphs for instance, Fortune 5000 companies such as Hershey, IBM, Apple, Procter & Gamble, Coca Cola, Pepsi, McDonald’s, Yum Brands and use their historic average return. Historic returns or using analyst or management forecasts are good indicators of the future stock price. Coca Cola for instance keeps growing sales and acquiring International bottlers or new products such as Water and Sports drinks.

Some companies will come and go for instance horse wagon makers in the 1800’s or Whale Fishing companies. Always watch trends such as car taking over for horses or oil taking over for whale blubber. Trends to watch include natural gas or electric cars along with lithium production and key technology. Technology is generally the best trend to analysis or what is the best way to produce a key service. Mutual funds for instance may go instinct with the wave of the future ETF’s.

Daniel asks…

How much money is not enough to invest in stocks and bonds?

I have always wanted to invest in stocks,bonds. But have never known what is the minimum money i need. Can i start investing with $100, $200 or $300? Or do i need thousands?

financi4 answers:

Some brokers have a minimum to open an account.

Scottrade is one that has a very low minimum: $500. The others I am familiar with are in the thousands. Now there is one brokerage firm that I know of that does not have a minimum. TradeKing.

You can start with $100, but the brokerage commission on such a small amount will be significant. With TradeKing their fee is $4.95 which is 5%. That is not a lot for a long term investor but for anyone buying and selling short term, that is a lot. If you were to start with $1000, $4.95 would represent only 1/2 of 1%.

Charles asks…

How do I make money from stocks & bonds?

I understand how money is made buying low and selling high. I dont understand how an investor can have “cash in their pocket” from having money in stocks & bonds.

financi4 answers:

For stocks, you make money two main ways. There is capital gain, where if you buy 100 shares of stock for $10 each and sell it later for $20 each, you get to pocket $1000 minus the brokerage fee (say, $10) for a net of $990. This money is typically credited to your brokerage account but you can turn it into cash just like any banking account.

Some stocks also pay a dividend, so if you own the stock when the dividend is paid, you will get money that way. If you buy 100 shares of stock and the quarterly dividend is $0.40, then $40 will appear in your brokerage account when the dividend is paid.

There are other ways to make money from stocks that are for more experienced investors (options, shorting, etc.)

For bonds, it’s about the same. The primary way to make money from bonds is the interest paid, but the bond’s value will fluctuate and you can sell the bond for more (or less) than you paid for it.

Joseph asks…

How do I find out information on retirement, stocks/bonds Life Insurance my husband hides from me?

Retirement, Life Insurance, stocks/bonds, Bank Accounts etc. We are in the process of a divorce and I need that information that he has kept from me. He is very controlling and has that kept confidential. I have already seen a lawyer… Isn’t there an easy way for the lawyer to request that information from him? Does my lawyer need my input so that we are sure to have ALL of the information? I’m confused. We have been married 7 years.

financi4 answers:

Let your Lawyer handle it. Just tell the lawyer that you know there are accounts that he’s hidden.

Any accounts that he has in his name only, you can’t get information on them by yourself as it is confidential. However, a judge can order him to show it. You just need to try to figure out as much of it as you can or any information you think he might have hidden so your lawyer can tell if he’s actually telling the truth when it comes time for a property settlement.

The way your Lawyer requests it is he gets a judge to order your husband to show it. No bank is going to give you information on any account that you aren’t on. Same with insurance. If you name isn’t on the policy, the insurance company isn’t going to give any information without a court order.

Robert asks…

How to get a complete list of the trading symbols for all stocks, bonds and mutual funds?

Where is a complete list of the trading symbols for all stocks, bonds and mutual funds that are traded on US exchanges and OTC?

financi4 answers:

Http://finance.yahoo.com/

John asks…

How to make money with stocks and bonds?

Im only 14, my dad tried to explain to me about it but im confused. Can somebody please explain to me CLEARLY about stocks & bonds and how to make money from them. Thank you

financi4 answers:

Stocks represent ownership in a company. You own one share…. Means you own a very small part of the company. Some companies have billions & billions of shares available to the public.

Bonds are a loan to a company or government usually at a fixed rate of interest.

Money is made by the increase in value of either.
Money is lost by the decrease in value of either.

The change in value is based on the “market”. It’s called supply and demand. Price (value) can change every nano second during the bidding process when the markets are open. People selling a stock or bond want as much money as they can get for it….. People buying a stock or bond want to pay as little for it as possible. When each side agrees on a price & complete the sale… That’s the price of the stock or bond…. Until the next sale by other people.

Hope that helps. Best bet is to do some reading on the subject.

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Investing in Toronto Condos

The Toronto Condos real estate market is expanding and flourishing even in the midst of difficult economic circumstances. As the town of Toronto continues to grow, the need for condominiums will carry on to rise. Even now, the Toronto market is beginning to heat up. Now is the right time to leap into the marketplace and snatch up some of Toronto’s phenomenal offers whilst funding prices are at historic lows.

The town of Toronto is Canada’s most populous city, as nicely as the province of Ontario’s capital city. A cosmopolitan locale of explosive development, Toronto condominiums are among the best in the globe. Building on condominium buildings continues to surge in Toronto, with the greatest and latest condominiums becoming constructed all the time. Numerous various industries call Toronto home, and with these industries come the nicely paying work that continue to entice newcomers to Toronto in higher figures every yr.

The selection, high quality, and lasting worth of Toronto condominiums make it a perfect location to commit in real estate. The high need for housing spurred by an influx of more than 1 million individuals over the previous decade mean that your investment is assured to generate a high degree of return. Whether or not you’re investing via pre-building sale, resale or assignment, the Toronto actual estate market is a sure wager that the money you invest will yield strong returns.

Higher growth marketplace, wide variety of investment possibilities, and historic lows on interest prices. If you are looking to make a wise purchase, now is the time to commit in Toronto condos!

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