Business Tips and Trends For January 2015

Everyone has centered their portfolio on the emerging market middle class,overlooking that they make 8,000 a year,not 50,000 a year like the American middle class,and buy different things than Americans do,points out value investor Bill Smead,CEO and CIO of Smead Capital Management in Seattle.As things slow in the economy,the consumer staples companies won't have the customers that they thought they would in the emerging markets.Earnings are going to be difficult.What will accelerate,will be domestic revenue streams,and the S&P 500 is not well set-up for that.
The balance sheet of the average 28 year-old is the best it's ever been,because the majority of 28 year-olds were married in previous decades.Since people wait so late to get married,they don't worry about student loan debt until they get a wife and a child-someone to worry about other than themselves.Warren Buffet has staked his company Berkshire Hathaway on them,with second tier companies that cater to them in its portfolio.
These millenials are doing things later,but they're going to do them.These echo-boomers are going to be the most exciting emerging market you ever saw.They're just getting married and having their first child,and when they do,they're going to want that stand-alone home.Everybody's scrambling around trying to find companies that make money off of them.*
The Ireland-based retailer Primark is coming to America in 2015.They sell bargain fashion,such as jeans for 7.00 a pair.They may well change the retail landscape.Primark Stores,Ltd. is a subsidiary of Associated British Foods.It has stores throughout Western Europe,where it sells its own brands of children's,men's and women's wear;homeware,acessories and foot wear;as well as beauty products and confectionary.Walmart,watch out.*
Right now,a lot of the offshore oil players are feeling the pain at a search cost of 50.00 a barrel,while the onshore oil shale search is only 20.00 a barrel,says Chad Brownstein of Rocky Mountain Resource Holdings.What you're going to see in the market in 2015 is,a lot of activism turning their guns on the oil companies.Hedge funds will come after small and mid-cap firms to consolidate and sell them.*
Everyone is saying stocks are overvalued,but they're not-when you look at a 2.2% yield on a ten year Treasury note,I think stocks are still a good value,said CNBC stock market reporter Bob Pisani.You've got dividends and earnings going up.*
Some large-cap stocks to consider:Gannett(CGI),eBay(EBAY),Amgen(AMG),Bank of America(BAC),Merck(MRK).They were the top five holdings of the Smead Value Fund(SMVLX) as of September 30,2014.