.jpg)
.jpg)
.JPG)
Why January 23 Could Be Launch Day For These 3...
By Ian Cooper
Dear American Capitalist Reader,
I walked two miles on Saturday… not on purpose, mind you. I was at Home Depot searching for customer support. It’s a good exercise in losing your mind. And no one can hear you scream in a thick piece of padding, like the one my wife shoved in my face to keep me quiet. But, this was only the start of the weekend… I won’t get into how my dog walked me for a mile or how my 10-month old figured out how to paint the ceilings with food.
I wouldn’t trade the fun with my dog or my son for anything. But they and my wife are all sleeping now. It’s 3 a.m. on Saturday and I just can’t sleep. There’s nothing on TV. I don’t feel like playing the PS2 games. So here I am working, looking for stocks because I love my job.
But I digress. Let’s get into how we can make some money. Last week, I told Early Alert Traders that in addition to the usual trading opportunities, they’d also start receiving a new value trade every Friday. The details of this trade are detailed below.
Please note: I wanted to share the first one with American Capitalist readers too to give you a taste of what Early Alert Traders will start receiving every Friday. The value system is being beta tested to Early Alert Trader for the next few months.
Click here to continue reading.
The State of the Union Address is on January 23, 2007… Mark it down.
President Bush is widely expected to express his support for ethanol during this address. By doing so, he could help spike shares of Pacific Ethanol (PEIX), Monsanto (MON), and quite possibly, Terra Industries (TRA). PEIX is in the ethanol business. Monsanto sells corn seed to farmers. And TRA produces liquid nitrogen fertilizer.
Ethanol is likely to see even more support from possible new ethanol legislation in California. According to the Post-Gazette.com, Gov. Schwarzenegger “ordered a cut of ‘at least 10 percent’ in the carbon content of motor-vehicle fuels used in his state by 2020, while governors of 37 states prepared to push for a new federal rule to require greater use of ethanol fuel.” Plus, the 37 governors are proposing “a new federal standard that would mandate substantially higher use of ethanol fuel and offer new tax incentives for the production of cellulosic ethanol, which can be made from farm wastes and wood chips, and doesn't rely on corn, the feedstock typically used by current ethanol producers.”
And there’s no shortage of ethanol demand. Corn prices, for instance, just spiked to a multi-year high after “the U.S. forecast the smallest global supplies in 29 years as record demand for ethanol uses more of the crop,” according to Bloomberg.com. “A 2006 harvest that was the third-largest ever in the U.S., the world's biggest corn producer and exporter, still won't prevent global supplies from dropping to the lowest since 1978, the U.S. Department of Agriculture said today in Washington. Corn prices have surged 86 percent in the past year.”
Because of a drop in supply and a big jump in demand (corn usage could jump 47% shortly, according to the Bloomberg.com report), farmers will need to produce more corn. This is where Monsanto (MON) comes into play. MON is the company that sells corn seed to farmers. You can even play Terra Industries (TRA), a producer of liquid nitrogen fertilizer. Farmers need this stuff to grow more in heavy demand. There you have it – three ways to play ethanol demand and the State of the Union Address. PEIX is a buy under $17. MON is a buy under $53. And TRA is a buy under $15.
Take care,
Ian L. Cooper, Editor, Early Alert Trader
ADVERTISEMENT |