ExxonMobil Buy Signal

Barrons last week had a cover that said "4 Reasons to Buy ExxonMobil". Simply put, Barrons saw it as "best management, best reserves, best balance sheet and best returns, and the best long term bet".

Exxon is one of our Shifty Fifty simply because of these traits, and we've made great money on the issue in options this last year. We also think it's a great long term CORE investment now, and will be more so on any consolidation, and recommend XOM ExxonMobil at current prices and below:

Buy to 74.00. Use a stop loss of 64.00 on a pnf chart, or use that as a time for a larger second buy.

“The idea that there is a competitive “private sector’ in American is appealing, but generally false. No one hates competition more than the managers of corporations.

Competition does not enhance shareholder value, and smart managers all know they must work at ways at “controlling” government intervention.

This is is not new. This is not Obamaland. When Congress created the first regulatory ageny, the Interstate Commerce Commission, in 1887 the railroad barons quickly recognized they were to be subdued, but could benefit. “The older a commission gets to be the more inclined it will be take the business and the railroad and business point of view. It thus becomes a sort of barrier between the railroad corporations and the people and a sort of protection against hasty and crude legislation hostile to railroad actions.”

All the above from Richard Olney, a railroad lawyer during that time period that lived his thinking, as soon after this quote he got himself appointed to run the U.S. Justice Dep, where he spent his days busting railroad unions.

Trader Tips:

*Trend Lines should connect at least three lows and occur over several months.

*The Price Expansion Rule: Model stocks experience an average P/E expansion from the first stage pivot point to typical peaks of 130% rises.

China, Debt, and How to Invest

*China is taking on record levels of debt to keep its’ economy running. Sound familiar? Some say it can’t last. China has had the smallest of hiccups of all global economies, the nation grew at a brisk 8.9% rate, and many economists expect it to expand even faster over the beginning of the year. And it could.

Over the past decade China has spent on roads, bridges and infrastructure.

We have been making just a few men very rich.

Those bullish on China think the government will keep spending (as ours should) no matter what to keep the economy humming, given it’s relatively healthy domestic balance sheet compared with the U.S.. Skeptics reply that if the debt taken on by provincial governments is taken into account (much like really straightening out our state debt, many in bankrupty), that growth looks questionable.

Emerging markets in general are highly risky and America has plowed our funds over there to “protect ourselves’” from out own stock market.

Temptleton EMF (EMF) remains our “mirror mutual fund’ of choice as a superb way to play the emerging markets safely. No stop loss. Just buy on dips, and hold.

Leggett and Platt-Stock Buy

For investors seeking dividend and long term return we are ready to buy Leggett and Platt (LEG)

Study this company: http://www.leggett.com/

It's in classic restructuring:

1. No longer growing from acquisition, but from streamlining

2. Yields 5.1%, and company has raised dividend for 38 years

3. This could rise to the 28.00 range in a year, return a dividend, and be a great value stock investment.

4. Watch for any consolidation and slight dip and buy LEG at market price, with a stop loss at 17.00

It's not part of our Shifty Fifty, just a stock we follow well that we think will grow well with economic upturn long term.