Week in Review

WeekIt’s been six days since the government has partially shut down and personally I haven’t noticed much of a difference. What does that say about some of the programs the federal government operates for us? Oh, yes, we now have a new healthcare law in place that will solve all the system’s cost and access problems. I can’t understand why Congressional members want to opt out of this “affordable” plan since it is so good for the rest of us. But enough Obomacare bashing for now. The stock market, as I have said many times in this blog, does not like uncertainty and therefore – at least the biggest of the blue chips – decided to give back some of the profits generated so far this year with the Dow Jones Industrials loosing 1.2% on the week, a second consecutive weekly drop. The S&P managed to remain mostly unchanged thanks to Friday’s rally and the NASDAQ was actually up by 26 points. The Street is hoping that there will be some positive news this week on the budget and the debt ceiling debates. But if not, the market will most likely stay in the doldrums and it may spread to some of the more U.S. dependent international markets too. Again, long-term investors should ignore much of the noise and stay their course.

On some individual buttonwoodproject portfolio news, JPMorgan Chase & Co (NYSE: JPM – $52.67) chairman and CEO Jamie Dimon has given up the title of chairman of the company’s main bank subsidiary JP Morgan Chase Bank, NA to conform with a new internal policy on multiple roles. While the actual handoff took place back on July 1, it was formally announced late last week. Still a volatile choice, JPMorgan Chase remains one of the top banks and its long-term growth potential outweighs much of the near-term regulatory and trading issues facing the company. The shares also provide investors with a nearly 3% yield. Teva Pharmaceutical Industries (NYSE: TEVA – $ 38.46)  – a buttonwoodproject laggard – moved up this week on news that the District Court of the Hague issued a favorable ruling in a patent revocation action brought by a unit of Mylan Laboratories Inc., seeking a court judgment that TEVA’s European patent expiring May 2015 for its flagship multiple sclerosis product, COPAXONE is invalid. The shares, in my opinion, still offer interesting total return potential out to late decade for those willing to wait for some positives on their turnaround strategy. The 3.1% yield will hopefully offer some downside protection while we wait.

“If (investors) try to time their purchases, they will do very well for their brokers, and not very well for themselves” – Warren Buffet, CEO Berkshire Hathaway.


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