Ran across this interesting article on Yahoo Finance – The 15 Companies that Might Not Survive 2009.

So, who do they think will hit the chopping block in the next 10 months? The list includes companies like troubled automaker Chrysler as well as Trump Entertainment Resorts (TRMP) and Six Flags (SIX). One company that I sincerely hope won’t go bust is Sirius Satellite Radio (SIRI). Says the article:

The music rocks, but satellite radio has yet to be profitable, and huge contracts for performers like Howard Stern are looking unsustainable. Sirius is one of two satellite-radio services owned by parent company Sirius XM, which was formed when Sirius and XM merged last year. So far, the merger hasn’t generated the savings needed to make the company profitable, and Moody’s thinks there’s a “high likelihood” that Sirius will fail to repay or refinance its debt in 2009. One outcome could be a takeover, at distressed prices, by other firms active in the satellite business.

The music certainly does rock, and I’m not about to give it up just yet. Are there any other companies you think won’t make it through 2009? Light up the comments…

P.S. Interested in 10 Companies that will thrive in 2009? Join our FREE BETA and you’ll get that special report when I release it next month! Sign up here…

We’re increasingly becoming a wire-free society. Since the Blackberry became a cult phenomenon in the early 2000s, business-class mobile applications have been coming out in a big way. After all, you can get your Bloomberg terminal ported over to your Blackberry these days. You can even make trades from your Blackberry. For better or worse enterprise-level business software helps busy professionals stay connected when they’re not at the office.

Here’s the problem – I traded in my Blackberry a year and a half ago for an iPhone, and until now I haven’t looked back. But when you’re responsible for keeping an eye on a portfolio of stocks for a couple hundred BETA subscribers, it becomes helpful to have a half-decent investment platform on the iPhone. The problem is that it doesn’t exist right now.

If you’re after stock information on the iPhone and the standard “Stocks” program just won’t cut it, the stable of Apps available today consist of:

1. Bloomberg – free, but doesn’t do a whole lot beyond delayed stock quotes and news. Certainly not the same as the Bloomberg Anywhere service you can get on your Blackberry.
2. StockWatch – a portfolio tracker for the iPhone. Like Bloomberg, limited feature set.
3. StockCharts – while I was initially excited at the prospect of interactive stock charts for the iPhone, reviews suggest that the timeframe is locked in at 1 year. Great.
4. TickerPicker Lite – this (and its full featured cousin) offer the technicians a possible (but not yet passable?) solution for the iPhone. In addition to advanced charting features, this one offers real time quotes.

Notably left off this list are the premium Apps that offer real-time quotes for a small fee… right, because I wouldn’t just go to Google Finance, Yahoo! Finance, or one of the other free sites that have real-time data now. Unbelievable.

If you’re an iPhone developer and want to make a halfway decent investing utility for anyone who needs a feature set beyond what’s available now, consider including portfolio monitoring, news, level II quotes, and halfway decent charts. Yes, it’s easy to throw together a crappy iPhone App and sell it for a couple bucks if you know what you’re doing. If you spend the time to make a good one, you might actually build a following and make some money too.

It’s hard to look at Peter Schiff with anything other than awe.

After all, the 44 year-old president of Euro Pacific Capital was mocked on networks like CNBC and Fox for predicting “wild” things like a real estate bust, a credit crunch, and a deep recession. Two years later, and Schiff’s original prophecies have come true.

That validation has been earning Schiff some much-deserved credibility in the financial world, where until now he’s been dismissed as overly pessimistic. “Schiff has suddenly emerged as a cult hero and something of a minor celebrity,” said Fortune’s Brian O’Keefe in a recent article.

According to the article, Schiff, a broker, even recently applied to become, “a licensed investment advisor so that he can actively manage clients’ money for the first time.”

Schiff’s Painful Performance in 2008

But does Schiff really deserve the acclaim he’s gotten found recently?

While Schiff has proved himself as an economist, his ability to parlay those predictions into profits for his clients was questionable for 2008. For the last few years, he’s been betting big on overseas investments and precious metals – two areas that got hit as hard or harder than the S&P last year.

According to Morningstar, the average international equity fund performed 7% worse than the average U.S. stock fund in the last year.

Just look at the iShares MSCI Belgium (EWK), the worst performing ETF last year according to SmartMoney.com, or the iShares FTSE/Xinhua China 25 ETF (FXI), which lost 49% in 2008.

Another of Schiff’s investment strategies has been to exit the U.S. dollar in favor of more fundamentally sound currencies. This too has proved untimely since anxious treasury investors have driven up the dollar in the last year.

And some, like Seeking Alpha contributor Todd Sullivan, are quick to remind investors that Peter Schiff has been bearish on the market since at least 2002, when the S&P was poised to move up 48% over the next five years.

Follow the Money Trail

Just because Schiff’s favored investments didn’t do well doesn’t mean that others’ investments didn’t. Just look at former hedge fund manager Andrew Lahde, whose real estate fund made 866% last year by betting that defaults would rise (Note: Lahde’s anti-industry farewell polemic is definitely worth reading).

Likewise, a lot of individual investors did well in 2008 by betting against the market – the ProShares UltraShort S&P (SDS) and Direxion Financial Bear 3X ETF (FAZ) are a couple examples of exchange traded funds that returned deep in the double digits.

Making Money in 2009

If you’re still trying to decide where to put your money in 2009, you’re not alone. While the market’s a lot less volatile than it was six months ago, it’s still wild enough to give pause to even the most decisive investors right now.

That said, I think Warren Buffett’s on the money buying undervalued American stocks (though I don’t agree with some of his recent choices). It’s a strategy that made these subscribers 15% in 2008, after all.

Now, I don’t think Schiff should be written off – he took a risky stance against CNBC’s perpetual bulls, and it paid off. He’s also helped to bring attention to some of our country’s very real financial problems. That’s something he should be congratulated for.

We’ll see where his investments go in the future, but it doesn’t look like his opinions are wavering for the time being. “…My problem has always been that I see things too clearly and too far in advance,” he said in the Fortune article, “Other people don’t understand what I do, so the markets might not validate what I’m saying right away. But they will eventually.”

Disclosure: SDS is a long position in the Rhino Stock Report’s model portfolio.

Are the attributes of a good company universal?

There’s no question that the difference between the goals of venture capital investors (who invest money in private startup companies) and individual investors (who invest in public companies on the stock market) is huge.

But when it comes down to it, we’re both investing in businesses. We’re both investing in management teams. We’re both investing in ideas. The results, though, are far from the same. The vast majority of VC investments result in successful exits… that means that the companies they invested in were either bought by bigger companies or went public through an IPO – either way, the VC investors make money the vast majority of the time (think Google for instance).

Is the same true of your portfolio? If not, is it because you’re not looking for the right stuff? On the American Express OPEN blog, Venture Capitalist Guy Kawasaki (a cool guy who I interviewed here) outlines what he looks for in investments for Garage Ventures, his VC firm. The verdict – look for realness, traction, cleanliness, forthrightness, and enemies. For the rundown on what that all means, visit the post here or his blog here.

It’s easy to become flustered by a market that doesn’t make sense. Just keep these things in mind when you’re stressing out about what’s going on on Wall Street…

1. Newsflash: The Market is Fickle

The market is fickle and it’s driven by people – a dastardly combination. Tons of individual investors don’t realize what moves the market… we do. It’s simple freshman economics: supply and demand at its finest, and when people get crazy it can get out of control.

Especially recently, the market seems to move wildly on ANY news whatsoever… that U.S. Airways flight that landed in the Hudson river today after a bird strike? Thank god it didn’t happen during trading; the market probably would have closed down around a million points. (How else can you explain why the story landed on the front page of TheStreet.com?)

When you come to terms with the fact that the market’s fickle, you’re ready to take on the next step…

2. Trust Your Strategy

If you’re a growth or value investor (like I am), then what’s there to freak about? While stocks may swing wildly from day to day the bottom line is is… in the long term, stocks are driven by events.

Earnings, mergers, management shakeups… they’re all events. Bad foreclosure rates aren’t. Neither are jobs numbers (unless you’re talking about the number of months Steve Jobs will be sitting out at Apple… that’s an event). The point is this – no matter what happens in the daily grind of the market, know that your strategy (be it growth, value, GARP, or whatever) is supposed to hold up to it.

3. Be a Robot

While hard to do, cold unemotional decision-making is the thing that most individual investors need to come to grips with. Heck, most institutional investment managers need to come to grips with it too. It’s difficult to part with a stock that you think is a winner, but numbers don’t lie, and when it’s time to let go, SELL it! (See #2)

4. Place Stops

Ah, the stop loss order… a great way to protect yourself if things were really to get bad (a la October). Use them, and use them frequently.

While this list is merely intended as a general guide to getting a grasp on why the market’s crazy, it should at least help you get a foundation going. More suggestions are welcome in the comments.

I’ve posted the second episode below (courtest of Hulu). It shows a day in the life of 20-something Tim Sykes back when he ran his hedge fund. Enjoy:

1. A Random Walk Down Wall Street: The Time-Tested Strategy for Successful Investing, Ninth Edition
   Written by Princeton’s Burton Malkiel, A Random Walk Down Wall Street is a staple for anyone who’s interested in getting started in the investing world. Accessible to novice and experienced investors, it’s an entertaining and enlightening read.
2. Stocks for the Long Run, 4th Edition: The Definitive Guide to Financial Market Returns And Long Term Investment Strategies
   Author Jeremy Siegel offers his thoughts on long-term stock picking in this evergreen investment book.
3. Security Analysis: The Classic 1951 Edition
   Widely thought of as the Bible for investors, Security Analysis is probably the best-known investing book among professionals and a great reference, but let’s face it… it’s a pretty cryptic read.
4. The Neatest Little Guide to Stock Market Investing
   For the investing-newbie, this book serves as a solid primer, but also delves into the heavier stuff.

Happy Holidays!

While the ushering in of the New Year may have you thinking about how you want to take that cruise this year or lose the 20 or so pounds that Grandma’s special cheesecake added to your midsection during Christmas dinner, don’t think that those good old New Year’s resolutions don’t carry over into your investments as well.

With the beating 2008 has served up for most investors, 2009 seems like a great time to accomplish a few of those things you wanted to do for your investments – it’s like getting rid of your portfolio’s spare tire. What should you tackle next year?

Here are five of the most popular New Years resolutions for 2009, with an investing twist that could help you wind up a little bit wealthier by 2010…

1. Trim the Fat

It’s not just a resolution your significant other has been pestering you about – and jogging isn’t the cure – when it comes to trimming the fat for your portfolio, your money’s on the line!

It’s a very good idea to re-evaluate the stocks and funds in your portfolio on a regular basis. Even if you’re a student of the buy-and-hold school, taking another look at what you own is still a prudent idea from time to time.

When you review your portfolio, take a look at the attributes that made a stock look good for you in the first place, and see if they still hold – is that company’s new product still a winner? Are any of the portfolio managers you’ve invested with named Madoff? Don’t be afraid to re-do your due dilligence.

Trimming the fat also means taking a look at how you’re investing, not just what you’re investing in. Knowing whether your portfolio is properly allocated is a great example… after all, there are other asset classes out there. Is it time to “think outside the stocks”?

2. Quit Stressing… About Your Investments

Stress isn’t healthy, so why let your investments add to it? I’ll admit, this one’s harder to accomplish (especially when your picks are available for all to see), but the benefits are well worth it. Don’t forget that while the average life expectancy here in the U.S. is 77.8 years, you’ve got to subtract a decade or two if you have a Wall Street office.

Are you one of those investors who needs to take a look at the market non-stop throughout the day? Unless you make a living from trading, think about taking on a “low-information” diet for 2009.

3. Learn Something New

Whatever the balance in your brokerage account, knowledge is (hopefully) one of your greatest assets. If there’s a part of the investing world you want to learn about – the basics of technical analysis, for example – why not take the time this year to expand your horizons?

Take a look at an investing book or two in 2009. Take a class on investment analysis at the community college. Attend a seminar.

As valuable as knowledge is, it can be had pretty cheaply… with tutorial-filled resources like Investopedia and Seeking Alpha, it’s not hard to get a grasp on a new investing subject gratis.

4. Help Those Less Fortunate

I’m not just talking about donating to charity here (although don’t forget, you can make tax-deductible charitable contributions of stock). What better to do with your newfound investment knowledge (see the previous resolution) than to share it with friends, family, and whomever else needs some “expert insight” for their portfolio?

After all, “financial” is a foreign language to most people. From passing on an informative article (hint, hint) to walking someone through how to execute a trade, don’t be afraid to have a hand in getting someone else’s investing smarts on track.

One thing to remember – money’s on the line, so when in doubt refer people to a licensed financial professional.

5. Get Organized

If you’re an active investor, one of the best resolutions you can have is to get organized. Being successful at the stock market often comes down to your decision-making abilities, and disorder can easily get in the way of making smart investment choices.

To help get things in straightened out, consider a service like Mint, which puts all of your financial accounts – like your brokerage, checking, and credit cards – in one place.

And if your investment analysis is leaving something to be desired, consider synthesizing your thoughts with a form.

Finally, go electronic for things like trade confirmations and your broker-related tax forms. Not only will going digital de-clutter your life, it’ll ensure that nothing’s missing when it comes time to files all of those capital gains you’re sure to have next year with the IRS. Most of the time, this stuff is available directly from your broker’s website.

Resolved to Invest Smarter

If you’re one of those people whose New Year’s resolutions are long forgotten by February, take heed – you won’t want to file these away with cleaning the garage and learning a language. Gains have been hard won in 2008; with New Year’s resolutions for your investments (and more than a little luck), here’s to seeing a more prosperous year in 2009.

Happy Holidays.

Is there such a thing as recession-proof?

Now that we’re in the midst of recession and approaching 2009 with breakneck speed, there’s no way to draw readers more surely than for investing publications to tout the merits of their “recession-proof” picks.

“Recession-proof stocks: Consumers may be skittish in this weak economy but they haven’t completely closed their wallets. Here’s which companies will benefit,” reads a headline on CNN Money.

“9 Recession Proof Stocks,” promises the Motley Fool to its readers. I’ll admit it – I too have become an investment writer who has thrown about the words “recession proof” to describe a stock I’ve liked this year… but those days have passed.

The truth is (and I’m sorry to say it) that the recession-proof investment is a myth.

What stocks have analysts been bandying about with recession-proof claims? CNN Money’s Paul La Monica talked about Apple (AAPL), Toyota (TM), and – are you ready for this one – Coach (COH) in an April article. Since then, the best performer of the three has been Toyota, only down 36%… not even the browbeaten S&P 500 has fallen so hard.

At the Fool, Joe Magyer took a more conservative approach, talking up the virtues of ampersand-riddled consumer non-cyclicals like Johnson & Johnson (JNJ) and Proctor & Gable (PG). Still, both companies are eating red ink since his article went to print.

What gives? If the best minds in the investment world can’t pick out recession-proof plays, what chance is there for the rest of us?

I hate to say it, but a “recession-proof” stock doesn’t exist. So I’m done using that word.

I mean, a stock immune to recession? That’s crazy; especially in the wake of the stomach churning volatility this market has shown us in the last couple of months. Now that’s not to say that there aren’t plays that can handle recessions better than others… PG and JNJ are actually great examples of stocks that have performed less horribly than the rest of the market.

Recession-resistant is what we should be talking about here. The issue isn’t a matter of semantics either… more on that in a second.

With the market anything but sane right now, less experienced investors are looking for safe places to put there money, and sage advice on how to do so. They turn to the advisors and investment writers of the world for guidance. And the fact is that “recession-proof” is a term that’s been used way too generously in 2008. After all, this is the year the game changed, a fact that even Variety had to point out in a column about slumping DVD sales in the once “recession-proof” adult entertainment industry.

For good or bad, “recession-proof” elicits a mental image among investors – that of a stock that keeps on chugging, maybe even flourishes, in a recession. The problem is that many pundits have ignored the fact that a real recession-proof stock should do well in the good times too.

Companies that clean up foreclosures have done great this year – after all, there’s been no shortage of work… but in a healthy economy, that business dries up.

Switching asset classes can be a good defensive move, but don’t think that it’ll shield you from the effects of a recession either. Even if you’re lucky enough to not lose money, you’ll still get smaller returns from investments like bonds or money market accounts.

Not even your savings account is immune – as interest rates keep getting slashed, so do the piddly returns you can expect from your stash of cash. Sorry, this one’s not recession-proof either.

That said, all is not lost…

When the going gets tough, the tough get defensive. Recession-resistant stocks (like those consumer non-cyclicals) may take a hit in a bad economy, but they’ll still do a good job of insulating your investments from the full force of things.

For medieval military strategists, a castle was one of the best ways to defend against an enemy onslaught that was too much to handle… it wasn’t enemy-proof, but it was a way to hold out while they waited for reinforcements. The same is true of your defensive investments… they’re a way to wait it out in relative safety until the tide changes, not a way to get on the offensive.

Even though recession-proof and recession-resistant sound a lot alike, there’s a very good reason to differentiate between the two. It’s a matter of offense versus defense. Simply put, as long as people think that their investments are immune to a bad economy (recession-proof), instead of resistant to it, people are going to get burned when things turn bad. Recession-proof investments aren’t a way to take an offensive position in tough times (not that there aren’t ways to do that, mind you), they’re a way to put your portfolio on the defensive and avoid matching the S&P’s less than admirable losses.

All of this doesn’t mean that you can’t make money in this market – in fact, many people have. What it does mean is that we need to rethink how we describe investments and how we approach stocks during downturns.

I’m done using the word “recession-proof” to describe stocks… from now on, it’s time to get defensive. Have any good defensive ideas for your portfolio? Feel free to share in the comments…