Over the past 6 months Assurant  (AIZ) has so far managed to get through the credit crisis unscathed. A few weeks ago a Barron’s article even suggested that Assurant will ultimately benefit from a continually weakening housing market. Although Assurant will continue to write more creditor placed homeowners policies, the company still has significant exposure to the credit crunch and a weakening economy.

First, let’s take a look at mortgage exposure.

Broadcom is entering the PON chip market and has secured design wins with a major tier-1 equipment vendor. While this is something predicted here, the timetable was sooner than expected. This will have a substantial impact on FTTH component and equipment suppliers as well as the carrier currently conducting lab trials with the device.

Back in April I identified an opportunity arbitraging the MacroShares Up UCR and Down DCR shares. The Down shares were overpriced relative to a fairly equivalent investment in USO puts. That play paid off well for me as noted in my last blog post.

However, now that the original up and down shares have terminated MacroShares has launched a new series with a higher termination trigger. The up shares (UOY) and down shares (DOY) just started trading yesterday and surprisingly the volume is fairly low compared to their recently expired siblings. I guess all the gamblers who were betting on oil going down have lost all of their money at this point. Also surprising is the fact that the down shares are not trading at much of a premium to NAV. In fact, yesterday the down shares closed at a 1.4% discount to NAV, which just doesn't make sense to me. It doesn't make sense because these shares are basically LEAPS and LEAPS are worth more than intrinsic value, or NAV in this case.

On Wednesday, we saw a disconnect between the price of copper and one of the world's leading copper producers Freeport McMoran (FCX). Copper futures have been rising steadily the past few days and are approaching overhead resistance, looking to breakout. Yet, during this rise in copper prices, you will notice that the copper producer FCX was beaten down in the market. So, we seem to have a disconnect here. If you take a look at copper futures, you'll notice an area of strong overhead resistance. If it breaks this to the upside, copper could really take off. We're talking about a multi-year ascending triangle building here.

click to enlarge

Please bear with me, I don't mean to be facetious here. Now that oil is over $140/barrel and everyone has a theory about why the price is so high, I thought I'd join the party and throw in my two cents as well.

By Jennifer Yousfi

Although meat-and-dairy prices are expected to zoom even higher from their current record levels, this slice of the commodities boom won’t be a slam-dunk profit play for investors: Many food producers are watching the revenue gains they’re reaping from the rising market prices get wiped out by even bigger spikes in commodity-related expenses.

Government contracts are very important for the security industry, but ultimately most of them – even the largest  – should mostly serve as beta-tests and reference sites for what should be a much larger industrial/commercial and institutional market.  Over the long term, we believe commercial/industrial contracts are steadier and involve greater recurring revenues.  But, of course, during economic slowdowns it might just be a big help to depend on those Government contracts. 

By Murray Coleman

Last June, gas prices at the pump were well below $3 a gallon and a rampaging mortgage meltdown wasn't even a reality yet.

Many of iShares S&P North American Technology ETF's (IGM) top holdings gained ground during the second quarter, even as the broad market slid toward bear market territory. Apple (AAPL), IGM's recent No. 3 holding, leapt nearly 19% for the three months ending June 27; No. 6 holding Google (GOOG) jumped more than 20% in the same period; No. 8 holding Oracle (ORCL) gained about 10% and No. 9 holding Qualcomm (QCOM) surged about 14%. Only three of the fund’s top ten holdings lost ground for the period, and none dropped by more than 3%. The fund itself gained about 5%.

IGM held more than half its assets in its top ten holdings during those three months—standard operating procedure for this fund—so strong performance by the largest U.S. tech stocks gave the fund's momentum a strong boost. IGM ranked 14th on the ETF Momentum Tracker Sector Table last week, up from 33rd on April 8. Whether IGM's momentum continues to build will depend largely on a few factors: how much tech spending slows in response to the turmoil in the U.S. economy, the success of the latest products released by major U.S. tech firms, and the ability of those firms to tap into overseas markets.

Some relief from tight oil supplies should be forthcoming during the next couple of years, but supply capacity growth will fall back below demand growth by 2011, based on current trends and assumptions, the International Energy Agency says. In its latest Medium-Term Oil Market Report, the IEA also says current high oil prices are the result of tight market conditions rather than speculation:

While recognising that speculation can have a day-to-day impact of price moves, the fact that all producers are working virtually flat out and that there is no sign of any abnormal stockbuild gives a strong indication that current oil prices are justified by fundamentals.

U.S. Federal Reserve Chairman Ben S. Bernanke ignored the warnings of most economists last week, and kept the benchmark Federal Funds rate at 2%, far below the actual rate of inflation.

As a result of this non-move, investors can probably look forward to having the global commodities boom continue for at least a while longer.

There were no venture-backed IPOs in the second quarter, and M&A deals are down. The last time there were no VC-backed IPOs in a quarter was in 1978. The liquidity drought for venture-backed startups is so bleak that the National Venture Capital Association is calling it a “crisis.” Last quarter there were only 5 IPOs that brought in a piddling $283 million. That compares to 43 IPOs during the first half of 2007 that brought in $6.3 billion.

(During the first half of 2008, 42 companies were in registration for an IPO, but they never pulled the trigger—versus 70 for the same period in 2007).

Blood was definitely running in the streets last month.

As our table below reminds, red is now the dominant color in performance tallies. But black hasn't been completely banished. For those who owned commodities, inflation-indexed Treasuries or cash, June wasn't a complete loss.

MP McQueen has a front-page WSJ article today attacking property insurers for, um, well, it's not entirely clear what they're supposed to have done wrong. Apparently they use something called "computerized catastrophe modeling":

Crafted by several independent firms and used by most insurers, so-called cat models rely on complex data to estimate probable losses from hurricanes.

But regulators and other critics contend that the latest cat models -- which include assumptions about various climate changes -- are triggering higher insurance rates.

The good old days

By Murray Coleman

Less than two weeks after the first wind energy exchange-traded fund hit the market, a more concentrated and at least initially more expensive alternative is set to launch.

By Mike Caggeso

Spot price of gold eclipsed $935 in trading Monday, its first time above the mark since May 22, as another fresh round of record oil prices exacerbated existing market-wide turmoil.

The jig appears to be up. Many factors have brought us to this point, but it seems that there are two paths left. One or the other will out, eventually.

On the one hand, the Fed may raise interest rates, and thereby support the dollar, which in turn will put downward pressure on oil, which is priced mainly in greenbacks. The alternative path is keeping rates unchanged and so allowing the oil bull market to run skyward unencumbered by any monetary policy braking.

With the S&P 500 back near major support at the 1270 level, which marked the lows reached in January and again in March, investors are asking themselves where do we go from here? Will buyers step up to defend these lows in stock prices as they have in the past? Or is the S&P 500 poised to break decisively into "official" bear market territory (more than 20% below the bull market peak)?

The second timber ETF in America launched on June 25th, reflecting the growing popularity of these vehicles among investors. However, I think both existing timber ETFs are bound to disappoint shareholders and will ultimately fade into obscurity.

Why Timber?