Avalanche of Good News

An Avalanche of Good News on Corporate Profits

by Louis Navellier

December 27, 2017

*All content in this Introduction to Marketmail represents the opinion of Louis Navellier of Navellier & Associates, Inc.*

The New Year January Calendar Image

The big news last week was the huge cut in top corporate tax rates (from 35% to 21%).  Once the analyst community returns from their holidays and ski vacations, they will undoubtedly be revising their 2018 earnings estimates higher.  As a result, January will likely be characterized by positive analyst revisions, as well as strong fourth-quarter results and new inflows from pension funding.  This 1-2-3 punch will likely make January a positive month, so I strongly recommend that if you have new money to invest in the stock market you do so in the remaining few days of 2017, since I expect January to start strong.

Also, Dealogic last week reported that corporate bond sales hit a record of $6.8 trillion in 2017, of which more than 55% was attributable to 10 large companies.  These record bond sales at super-low interest rates may explain why companies are also boosting their dividends and stock buy-backs, which are also expected to rise steadily in 2018 due to the windfall profits that Corporate America will be receiving.

We have also received positive guidance from some leading companies in the technology sector.  A couple of weeks ago, Broadcom (AVGO) announced better-than-expected quarterly results and issued positive guidance.  Last Tuesday, Micron Technology (MU) did the same thing by announcing better-than-expected quarterly sales and earnings, plus higher guidance.  In other words, there is no reason to fear a “tech wreck,” which was recently propagated by the fake news folks.  If anything, the technology sector should continue to post better-than-expected results – as these recent results have demonstrated. (Please note: Louie Navellier does currently hold a position in AVGO and MU in Mutual Funds. Navellier & Associates does currently own a position in AVGO and MU for client portfolios).

In This Issue

In Income Mail, Bryan Perry makes the case that the latest energy sector rally is for real and the beaten-up energy master limited partnerships (MLPs) are the best play.  Next, Gary Alexander reviews his 2017 forecasts and goes against the mainstream media once again by predicting rising tax receipts in 2018.  Ivan Martchev repeats his warnings against Bitcoin mania, the “electronic tulip bulbs” of our time, while Jason Bodner turns sectors into poetry.  Then, I’ll cover recent real estate readings and some year-end madness.

Income Mail:
Energy Sector Posting Impressive Year-End Rally
by Bryan Perry
Big-Name Integrated Energy Stocks Trading Like a Well-Oiled Machine

Growth Mail:
Four Fearless Forecasts for 2018
by Gary Alexander
New Forecast: Tax Collections will RISE by $150 Billion (4%) or More in 2018

Global Mail:
Why This Bitcoin Decline is Different
by Ivan Martchev
How NOT to Trade Bitcoin in the Stock Market

Sector Spotlight:
‘Tis the Night After Christmas
by Jason Bodner

A Look Ahead:
The Real Estate Market Has Fully Recovered
by Louis Navellier
Some Year-Ending Craziness

Income Mail:

*All content of "Income Mail" represents the opinion of Bryan Perry*

Energy Sector Posting Impressive Year-End Rally

by Bryan Perry

As the 2017 stock market rally rolled along, it did so for the most part without the broad participation of the energy sector. Heading into the month of December, it was pretty much thought that investors would book their expected losses in energy stocks to reduce taxes from gains collected from other (technology, financial, consumer discretion, industrial, health care, and transportation) more profitable sectors.

While the price of WTI crude made its way back to $58 per barrel earlier this month, most stocks within the energy sector still lagged under the notion that the coordinated production cuts by OPEC and non-OPEC nations would at some point come to an end or endure widespread cheating, as has been the norm, historically; but instead, oil-producing countries have generally complied, and now the market is firming up as tax reform lifts the outlook for accelerated U.S. growth, which will also benefit the global economy.

There seems to be an epiphany by investors that a genuine rebalancing is possible without the intervention of production manipulation. And it’s not just tax reform that is triggering the rally. Economic data around the world is showing global synchronization of growth, according to the investment research firm CFRA.

“For the second quarter in a row, all 45 countries tracked by the Organization for Economic Cooperation and Development (OECD) showed year-over-year growth in gross domestic product growth (GDP) in the third quarter,” investment strategist Lindsey Bell wrote last Thursday. “CFRA views such broadening of growth an important sign of world health and a positive for the international outlook.” – Investor’s Business Daily – “Investing Action Plan” – December 22, 2017.

This most recent recognition of strong growth by the OECD has investors feeling like another leg to the bull market is about to take hold, providing a fresh bid under not just the energy sector, but the commodities and materials sectors as well. Stocks of copper, steel, cement, fertilizer, wood, and other deep cyclical commodities are seeing a sudden wave of new interest, something like a wake-up call.

While there have been two or three short-term commodity-related rallies this year, they all petered out after a few days, making the current rally suspect as well. However, the evidence of global economic reflation is widespread and not just regional, making the case for taking this nascent rebound in cyclical commodities seriously. For income investors, that would mean targeting some beaten-up energy master limited partnerships (MLPs) that have been bumping along the bottom of their 52-week ranges all year.

Most energy MLPs have been left behind as road kill this year amid steep losses, but now there is a pulse being felt among some of the stocks, some of which sport double-digit-percentage distribution yields. I have been highly cautious in my view of the sector all year, but as of this month there is notable rising money flow into the best-of-breed names that deserve the attention of all income-oriented investors.

Looking at the chart of the JPMorgan Alerian MLP ETN (AMJ) that closely tracks the energy MLP space and pays a current yield of 7.0%, there is a good technical case that a new uptrend is in the very early stages of being established. We’re seeing a high level of trading volume, where a reversal of trend looks to be shaping up. It’s still very early to call it a new bull trend, but this development bears close watching. If it is a turning point, then the opportunity for strong outperformance in 2018 is excellent.

JP Morgan Alerian MLP Index ETN Chart

Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.

Leave no doubt, there is a lot of overhead resistance and a lot of frustrated long-side exposure to many of the leading MLPs. So, making new believers of those who have been thoroughly punished for many months won’t come easy. At the same time, few of the leading MLPs cut their distributions in 2017 making the wait not as painful when considering the lofty level of quarterly income being received.

Big-Name Integrated Energy Stocks Trading Like a Well-Oiled Machine

It’s my view that WTI crude needs to above $60 to get the majority of investors back on board the MLP energy train. To date, the big integrated oil and refining companies have stolen the spotlight, trading smartly higher. It won’t be long before we know if all the energy sub-sectors join in the rally for real.

The chart of the Energy Select Sector SPDR Fund (XLE) whose top two holdings of ExxonMobil and Chevron make up 40% of the weighted holdings shows just how potent the integrated and refining stocks have been. Shares of XLE have rallied 18% since mid-August, catching most investors completely flat-footed and wondering if this breakout is the start of a larger move or just another overly optimistic rally that attracts momentum capital looking for a place to go that fizzles out as fast as bitcoin did last week.

Energy Select Sector SPDR Fund Chart

Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.

As fourth-quarter 2017 earnings season is about to unfold, I’ll be covering this developing story closely and sifting out the best high-yield income strategies for income investors to move into as 2018 gets under way. For Q4 2017, the estimated earnings growth rate for the S&P 500 is 10.9%. All 11 sectors are expected to report growing earnings, led by the Energy sector (see FactSet Earnings Insight, 11/22/17).

Assuming the leading blue-chip energy stocks deliver on the bullish forecast for a robust reporting season, the fire may well be lit for the MLP sector. That would give income investors a promising year ahead.

Stay tuned.

Growth Mail:

*All content of "Growth Mail" represents the opinion of Gary Alexander*

Four Fearless Forecasts for 2018

by Gary Alexander

I was three-for-three with my 2017 predictions. Although my picks were contrarian, it now looks like I was too timid about stocks. The stock market and the economy did far better than most pundits expected.

Here’s a one-paragraph summary of each of my three 2017 predictions from a year ago:

#1: A 12% to 16% Gain in the S&P 500 in 2017. My first ‘contrarian’ pick makes me more bullish than the 15 most famous Wall Street analytical firms: In “How Will Stocks Make Out in 2017?” (USA Today, December 27, 2016), Adam Shell examined the 2017 S&P 500 forecasts from 15 major Wall Street firms. All 15 see a positive 2017, but most of them see only modest gains, averaging 5.5%. On the low end, five of the 15 analysts see an S&P 500 year-end reading of 2,300, only 2.7% above the 2016 year-ending benchmark of 2,239. Only one analyst (Jonathan Golub, chief equity strategist at RBC Capital Markets) sees a double-digit 2017 S&P gain, at +11.67%.” The gain through Friday is about 20%.

#2: No First-Term (2017-2020) Recession Under Trump. It has been almost eight years since the current economic recovery began, and no growth cycle in U.S. history has stretched beyond 10 years. However, records are made to be broken. The 10-year recovery of 1991 to 2001 itself broke the previous record of 8 years and 10 months (February 1961 to December 1969), which broke the World War II record of 6 years and 8 months (1938 to 1945), which broke the previous record of five years. The reason I think this recovery will last beyond 10 years (to 2019 or later) is that 2009-16 growth rates have been so slow. A Goldilocks recovery (neither too hot nor too cold) can last longer than an overheated one.” As it turns out, the anemic sub-2% growth rates under Obama have expanded to 3%+ in 2017.

#3: Gold Will Stay Above $1,000 throughout 2017.  I’m about to go out on a limb, and risk $1,000 in doing so. Ivan Martchev’s 2017 prediction (published here on December 13th) was that gold will fall below $1,000 per ounce in 2017. This has become a very popular prediction on the Web, republished on many sites. I’m taking a contrarian position by betting Ivan $1,000 that gold will stay above $1,000.”

I’m so pleased with all three of these predictions that I will renew them all for 2018, along with the $1,000 gold bet – with the agreement of Ivan Martchev. Now, here is a new “contrarian” prediction.

New Forecast: Tax Collections will RISE by $150 Billion (4%) or More in 2018

“The art of taxation consists in so plucking the goose as to obtain the largest possible amount of feathers with the smallest possible amount of hissing.”

-- Jean-Baptiste Colbert, Louis XIV’s Finance Minister

On the road to visit family for Christmas, I picked up a copy of the December 21 USA Today and saw the Page 1 headline, “Government headed for $1 trillion deficit?” On the day President Trump signed the new tax bill into law, USA Today repeated the opposition’s talking points by featuring this statistical subhead:

“The tax package would cut government revenue by $135 billion in 2018, a figure that would rise to $280 billion in 2019, according to the Joint Committee on Taxation.” – USA Today, 12/21/17

I will predict the opposite: Tax revenues will rise by $150 billion (4%) in 2018, and $300 billion (8%) by 2019. I have history on my side. After all four major tax cuts in the last century, tax collections rose in the next several years – usually dramatically. No matter how many talking heads on television cite how many studies saying the opposite, I’d like to show them the following facts, which all support my case.

#1: In the 1920s, a series of tax cuts engineered by Secretary of the Treasury Andrew Mellon (serving Presidents Harding, Coolidge, and Hoover) reduced the top income tax rate from 60% down to 25%, but the amount of taxes paid by the rich (earning over $100,000) grew from $321 million in 1920 to $714 million in 1928 (source: Veronique de Rugy, the CATO Institute: “1920s Income Tax Cuts Sparked Economic Growth and Raised Federal Revenues.”) These tax cuts fueled the Roaring 20s prosperity.

Taxes Paid after 1920s Tax Cuts Table

This was a general time of deflation and small government so total tax collections did not grow much, but the key point is that the proportion of taxes paid by the rich more than doubled from 30% to 61%. Also, from 1922 to 1929, real GDP grew by 4.7% per year and the unemployment rate fell from 6.7% to 3.2%.

#2: In the 1960s, the same thing happened under the Democrats. The Kennedy-Johnson tax cuts passed in 1964, shortly after JFK was assassinated. Tax collection growth was anemic in the early 1960s but took off dramatically after LBJ cut the top rate from 91% to 70%. Tax revenues increased each year – creating a surplus in 1969, despite LBJ’s guns and butter policies, plus landing men on the moon!

Tax Receipts After Kennedy/Johnson Tax Cuts Table

It took a while for the tax cuts to work their magic but the average growth rate of tax receipts from 1961 to 1965 was a tepid 4.8%, while the average annual growth rate from 1966 to 1969 was a sizzling 12.7%.

#3: In the 1980s, the same story was repeated with the Reagan tax cuts. Tax receipts soared when the top tax rates were reduced from 70% to 50% in 1983, and then down to 28% in 1987. Notice the big boost in tax collections in 1984-85, and then a second, bigger boost in 1987 – despite a big market crash that year.

Tax Receipts after Reagan Tax Cuts Table

The 1980s began with high inflation and negative growth – “stagflation” – so I have included “real” growth rates to dramatize the leap from negative tax receipt growth in 1982-83 to over 6% real growth in 1984-85.

#4: In 2003-07, George W. Bush’s tax cuts had the same effect – pardon the repetition. Tax receipts were steadily declining from 2000 to 2003, but when Bush cut top tax rates, tax receipts suddenly soared:

Tax Receipts After Bush Tax Cuts Table

Tax receipts fell 12% from 2000 to 2003, but in the four years after Bush cut rates, receipts grew 44%. Tax collections rose $273.5 billion in 2005 and $253.3 billion in 2006, so I’m confident in predicting a paltry $150 billion rise in 2018. The evidence shows that the rich (like French geese) are more willing to pay taxes at lower rates. Econometric models predict lower tax receipts, but history says the opposite.

Next week, I’ll return with more fearless forecasts for 2018…

Global Mail:

*All content of "Global Mail" represents the opinion of Ivan Martchev*

Why This Bitcoin Decline is Different

by Ivan Martchev

On November 21, 2017, a client asked me how to invest in bitcoin and whether Navellier & Associates offered a crypto-managed account. I will omit the client’s name but below is my response:

In my professional opinion, since you are a client and we owe you fiduciary guidelines, bitcoin is a scam. It is designed to cram a rising amount of people into a limited number of bitcoins (will top out at 21 million or so), that's why the price is rising. This is a bigger scam than Madoff in plain sight. I think it ends like Madoff, but it is not over yet. (sources: Bloomberg, November 21, 2017, “Wealth Managers are Being Inundated with Calls About Bitcoin” and “Cryptocurrency Market Capitalizations,” same day).

The Bloomberg article described how clients call advisors to ask how to invest in bitcoin. It is right on the money, as I have experienced it more than once. But given the action in bitcoin over the past week, I have to say that it is possible we have reached the top, as the trendy electronic crypto-currency collapsed from $19,363 on Sunday, December 17, to a low of $12,148 (down 37% in five days) before recovering a bit.

BitStamp Index Table

Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.

The interesting part is that Bitcoin closed at $8,095 on November 21, 2017 when that email exchange happened, so this “electronic tulip bulb” as I like to call this crypto absurdity saw its price more than double before it crashed last week. If one had bought bitcoin on November 21, one would still be up more than 50% as of this past Sunday, although I am not sure for how long, given how fast the market for bitcoin is moving. Also, bitcoin trading is 24/7, including weekends.

Here is the typical map of investor sentiment for past bubbles:

Investor Sentiment Phases Chart

I think it is entirely possible that the mania phase ended last week and we have started the blow off phase. When Bloomberg ran a story to describe the wild trading in bitcoin last week, it included the following chart (December 21, 2017 article, Bloomberg.com, “Bitcoin Lost Almost 20% of Its Value This Week”).

History of Bitcoin Crashes Chart

Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.

The implication in the above chart is that we have seen similar crashes before in Bitcoin, which I take to suggest that this may not be a top. The reason why I think it may be a top is that previously when those crashes happened we were not in a full-blown mania phase and bitcoin had not yet hit the mainstream. Given that the phone had started to ring with questions on how to capitalize on this electronic tulip bulb absurdity is a good indication that we just completed the mania phase, which to me suggests that last week’s decline may be different.

The popping up of other cryptocurrencies is similar to the numerous dot.com IPOs at the height of the Nasdaq mania in 1999-2000. In addition to bitcoin we have “bitcoin cash,” a different crypto absurdity named to only associate itself closer with its namesake electronic tulip bulb. Most other cryptos also had really bad sell-offs last week, but the drama is obviously concentrated on bitcoin because it is the only one with futures trading and it is also the biggest. The “value” of this electronic nothingness reached over $300 billion last week and as of this writing is still near $220 billion so there is a lot more pain to come.

Litecoin Rally Chart

Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.

It is also notable to point out that one of these crypto “IPOs” named litecoin had its founder dump his entire stake last week after he got wind of the vicious popping of the crypto bubble. The litecoin founder gave the official reason for his cashing out to be to avoid conflicts of interest when he comments on the crypto market, which I personally do not buy as a valid reason.

The action last week appears to be a meaningful break in the bitcoin madness. I would only add that the major stages in a bubble (as seen in the second chart above) are likely to develop a lot faster than in the case of the Nasdaq in 2000, due to the fact that Bitcoin is not an operating company but a line of code.

How NOT to Trade Bitcoin in the Stock Market

In looking up details for this column, I came upon a publicly-traded trust in the OTC market whose business is to hold bitcoin! The electronic tulip bulb absurdity is multiplied in this case as the trust typically trades at better than 50% premium to the “value” of the electronic tulip bulbs it holds (see December 21, 2017 Benzinga article, “How The Bitcoin Investment Trust Actually Works”).

GBTC Bitcoin Investment Trust OTC Chart

Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.

The bitcoin trust was changing hands near $100 in early 2017 but last week it reached $3523 before correcting to under $1200. While I would advise sane investors to stay away, obviously the goal of the creators of this trust was to make it easier to capitalize on the bitcoin mania in the stock market.

While this bitcoin stock market vehicle is unshortable due to the heavy borrowing fees as well as the difficulty with which one can borrow the shares, the GBTC ticker will serve a valuable illustration tool for our purposes as it would allow me to illustrate how the theoretical 10-year gold/bitcoin trade described in last week's Marketwatch column would work. (Please note: Ivan Martchev does not currently hold a position in Bitcoin. Navellier & Associates does not own a position in Bitcoin for any client portfolios).

GBTC:GLD Bitcoin Investment Trust/SPDR Gold Shares OTC Chart

Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.

I mentioned December 19 that if the choice were given to me to hold one bitcoin or the equivalent in gold bullion for 10 years and only be able to sell one of those two items at the end of the decade, I would take the gold bullion because in the case of bitcoin there was unlikely to be any “thing” to sell.

This type of trade can be tracked with a GBTC: GLD ratio (see chart above) where the bitcoin trust and the GLD ETF can be seen with GBTC outperforming when the chart is going up and gold outperforming when the chart is going down. Last week that GBTC: GLD ratio moved from over 29 to under 10 before settling at 16.45.

If this was the climactic top in the electronic tulip bulb market, we should not exceed the 29.40 reading seen on the GBTC: GLD ratio seen last week. Also, I think the large NAV premium of the GBTC trust would eventually disappear and that the GBTC: GLD ratio would eventually decline below 1 (where it was earlier in 2017), if not ultimately zero.

Sector Spotlight:

*All content of "Sector Spotlight" represents the opinion of Jason Bodner*

‘Tis the Night After Christmas

by Jason Bodner

'Tis the night after Christmas, and as far as Guam,
Not a stock is stirring, not even overstock.com;
The stocks are all arranged by sector with care,
In hopes that another 2017 soon will be there;

The leading stocks are nestled all snug in their beds,
While thoughts of 52-week highs danced in their heads;
As dreamy dozing blankets the land,
Now’s as good as ever to recap events since last Jan.

The first of the year found all sectors even,
Yet as ’17 closes, Info’tech’s leading.
At plus thirty-eight-point four percent,
Info-tech’s margin was too wide to dent.
Driven by Internet Software no doubt,
The future seems bright for this sector with clout.

Standard and Poor's 500 Sector Indices Table

Consumer Discretionary stocks acted with grace,
So much so the sector has reached second place.
At plus twenty-one seven, the group pushed higher,
The Retail stocks rally was a main sector driver.

Plus twenty-one two, the third nicest sector,
Materials it was, a surprisingly high vector.
Next, neck and neck, came sectors four and five.
The two battling to show which one’s more alive.
Yet Financials won fourth place, earning twenty point seven,
Banks saw resurgence, ranking fourth of eleven.

Just a hair behind, but technically fifth,
We saw Health Care climb, hard to keep pace with.
Its twenty point five growth, in typical years
Might have been first place, prompting even more cheers.

Coming in sixth, Industrials closed with a bang,
Falling just short of joining the twenty-plus gang.
This ordinarily sleepy segment,
Vaulted high in both prices and investor content.

We dip to 10 point four for the seventh spot,
But Consumer Staples finished quite bought.
For what a spectacular year of nonconformance,
When seven sectors finish with double-digit performance!

Respectable still, not being left out,
Utilities still performed its own rout.
Up eight percent is hardly a fault,
When treasuries yield far lower, hardly filling your vault.

The Real Estate sector is not as profound
It still made a showing in positive ground
Plus five point eight percent it did climb,
Giving us our final count of “up sectors” at nine.

Now for the naughty; the pair that did worst
First, the Energy sector, which once was the first.
As cyclical as the market can seem
‘Twas not the year for energy’s team.

Coming in last with a stocking full of lumps,
The sour performance made Telecom investors grumps.
Its minus five point eight percent was this year’s last,
A party pooper in this year’s market blast.

As I close this article and almost this year,
The Sound of Music’s song echoes my cheer.
“So long, farewell, au revoir, auf wiedersehen.
I’d like to stay and taste my first champagne.”
But before I go, and fade out of sight,
HAPPY NEW YEAR TO ALL, AND TO ALL A GOOD-NIGHT!

Sandman on a Beach Image

A Look Ahead:

*All content in this "A Look Ahead" section of Market Mail represents the opinion of Louis Navellier of Navellier & Associates, Inc.*

The Real Estate Market Has Fully Recovered

by Louis Navellier

A decade ago, the real estate market was falling apart after a bubble of historical proportions built and burst, leading to the 2008 financial crisis.  It took time, but the U.S. real estate market is back on track.

On Tuesday, the Commerce Department announced that new home starts rose 3.3% in November to a 1.297 million annual rate, which was a big surprise since economists expected a 3.1% decline.  Single-family housing starts are strong and expected to keep rising due to rising optimism and tight inventories.

The next day, the National Association of Realtors reported that existing home sales surged 5.6% in November to an annual pace of 5.81 million, the highest level in 11 years.  The inventory of existing homes for sale remains super-tight at only a 3.4-month supply, so prices are expected to continue to rise.  Median home prices rose 5.8% vs. a year ago, the 69th consecutive month of home price increases.

Rounding out the real estate reports for November, on Friday, the Commerce Department announced that new home sales surged 17.7% in November to an annual rate of 733,000, the highest annual pace in more than a decade (since July 2007), and substantially higher than economists’ consensus estimate of 654,000.  Over the past 12 months, new home sales are now running 26.6% higher than a year ago.

In other news released last Friday, the Commerce Department announced that consumer spending surged 0.6% in November after rising 0.2% in October.  (These are month-over-month figures, not annualized.)  The fact that some large companies are giving their workers large cash bonuses after the Corporate Tax Reform bill passed should help boost consumer confidence and spending now and in upcoming months.

The final slice of positive economic news released last Friday was that the Commerce Department announced that durable goods orders rose 1.3% in November.  In the past 12 months, durable goods orders have risen 5.1%, due largely to strong business investment.  The Corporate Tax Reform should boost business investment, so I expect a big recovery in durable goods orders in the upcoming months.

Some Year-Ending Craziness

Bitcoin prices collapsed last week, perhaps because The Wall Street Journal reported on Wednesday that investigators in South Korea are looking into North Korea’s involvement in a heist from a bitcoin exchange, Youbit, that collapsed on Tuesday in Seoul.  Apparently, South Korea’s state cybersecurity agency is trying to identify who hacked into Youbit, and North Korean hackers are a prime suspect.  There were also some other South Korean cryptocurrency exchanges that North Korea may have hacked.

Also, the White House said on Tuesday that North Korea directed this year’s WannaCry ransomware attack that locked digital files and demanded a bitcoin payment for these digital files to be unlocked.  North Korea has apparently dispatched 7,000 hackers around the world and given them lucrative financial incentives, so bitcoin’s weakness last week may be related to North Korea’s aggressive hacking activity.

Another interesting article in The Wall Street Journal last week showed how Germany’s federal statistics agency stopped sending sensitive economic data to journalists before they were publicly available after reading about some suspicious currency trading patterns.  According to currency traders, 2017 was the hardest year to trade currencies in 16 years, partially due to leaks on preliminary economic data by some journalists.  Specifically, WSJ reported that just minutes before the release of some important German economic data, currency futures moved as if some traders knew what data was going to be in the report.

Since Germany is the largest and most influential country in the European Union, this apparent leak by journalists to currency traders is truly a major scandal!  Interestingly, in Britain and the U.S., journalists also get access to economic reports shortly before their official publication, but only at special “lock in” rooms in government buildings, where their electronic communications are blocked.  Clearly, Germany is now less trusting of journalists and has decided to prohibit early access to sensitive economic data.

Happy New Year!


It should not be assumed that recommendations made in the future will be profitable or will equal the performance of the securities in this list. Click here to see the preceding 12 month trade report.

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It should not be assumed that recommendations made in the future will be profitable or will equal the performance of the securities in this list. Click here to see the preceding 12 month trade report.

Although information in these reports has been obtained from and is based upon sources that Navellier believes to be reliable, Navellier does not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute Navellier's judgment as of the date the report was created and are subject to change without notice. These reports are for informational purposes only and are not intended as an offer or solicitation for the purchase or sale of a security. Any decision to purchase securities mentioned in these reports must take into account existing public information on such securities or any registered prospectus.

Past performance is no indication of future results. Investment in securities involves significant risk and has the potential for partial or complete loss of funds invested. It should not be assumed that any securities recommendations made by Navellier. in the future will be profitable or equal the performance of securities made in this report.

Dividend payments are not guaranteed. The amount of a dividend payment, if any, can vary over time and issuers may reduce dividends paid on securities in the event of a recession or adverse event affecting a specific industry or issuer.

None of the stock information, data, and company information presented herein constitutes a recommendation by Navellier or a solicitation of any offer to buy or sell any securities. Any specific securities identified and described do not represent all of the securities purchased, sold, or recommended for advisory clients. The reader should not assume that investments in the securities identified and discussed were or will be profitable.

Information presented is general information that does not take into account your individual circumstances, financial situation, or needs, nor does it present a personalized recommendation to you. Individual stocks presented may not be suitable for you. Investment in securities involves significant risk and has the potential for partial or complete loss of funds invested. Investment in fixed income securities has the potential for the investment return and principal value of an investment to fluctuate so that an investor's holdings, when redeemed, may be worth less than their original cost.

One cannot invest directly in an index. Results presented include the reinvestment of all dividends and other earnings.

Past performance is no indication of future results.

FEDERAL TAX ADVICE DISCLAIMER: As required by U.S. Treasury Regulations, you are informed that, to the extent this presentation includes any federal tax advice, the presentation is not intended or written by Navellier to be used, and cannot be used, for the purpose of avoiding federal tax penalties. Navellier does not advise on any income tax requirements or issues. Use of any information presented by Navellier is for general information only and does not represent tax advice either express or implied. You are encouraged to seek professional tax advice for income tax questions and assistance.

IMPORTANT NEWSLETTER DISCLOSURE: The performance results for investment newsletters that are authored or edited by Louis Navellier, including Louis Navellier's Growth Investor, Louis Navellier's Breakthrough Stocks, Louis Navellier's Accelerated Profits, and Louis Navellier's Platinum Club, are not based on any actual securities trading, portfolio, or accounts, and the newsletters' reported performances should be considered mere "paper" or proforma performance results. Navellier & Associates, Inc. does not have any relation to or affiliation with the owner of these newsletters. There are material differences between Navellier & Associates' Investment Products and the InvestorPlace Media, LLC newsletter portfolios authored by Louis Navellier. The InvestorPlace Media, LLC newsletters and advertising materials authored by Louis Navellier typically contain performance claims that do not include transaction costs, advisory fees, or other fees a client may incur. As a result, newsletter performance should not be used to evaluate Navellier Investment Products. The owner of the newsletters is InvestorPlace Media, LLC and any questions concerning the newsletters, including any newsletter advertising or performance claims, should be referred to InvestorPlace Media, LLC at (800) 718-8289.

Please note that Navellier & Associates and the Navellier Private Client Group are managed completely independent of the newsletters owned and published by InvestorPlace Media, LLC and written and edited by Louis Navellier, and investment performance of the newsletters should in no way be considered indicative of potential future investment performance for any Navellier & Associates separately managed account portfolio. Potential investors should consult with their financial advisor before investing in any Navellier Investment Product.

Navellier claims compliance with Global Investment Performance Standards (GIPS). To receive a complete list and descriptions of Navellier's composites and/or a presentation that adheres to the GIPS standards, please contact Navellier or click here. It should not be assumed that any securities recommendations made by Navellier & Associates, Inc. in the future will be profitable or equal the performance of securities made in this report. Request here a list of recommendations made by Navellier & Associates, Inc. for the preceding twelve months, please contact Tim Hope at (775) 785-9416.

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