Recently we were thinking about movies with some kind of financial lesson. The financial side of making films has always intrigued us. Historically the Oscars have always been proof that the biggest budget doesn’t always give the best ROI. In 2010, the lowest grossing Oscar winning film in history – The Hurt Locker – beat out the highest grossing picture in history – Avatar.
Here’s my list of the top 10 movies ever made that have a financial lesson inside of them.
1. Boiler Room (2000) – A college dropout gets a job and enjoys fast success at a brokerage house selling phony stock. However, the job turns out not be as legit as it sounds. This film is mix of Wall Street and Glengarry Glen Ross thrown in. Although there’s no character here that can compare to Michael Douglas’ Gordon Gekko.
Lesson: Great morality lesson dealing with the desire to get rich quick, regardless of the consequences.
2. Wall Street (1987) – “Greed, for lack of a better word, is good”. This line by ruthless corporate raider, Gordon Gekko, summed up the business ethics of the 1980s, when greed, corruption and the predatory nature of the financial world was at its most conspicuous. The film charts the ascent of a young, ambitious stockbroker who’s taken under Gekko’s wing and struggles with whether it’s better to have money or integrity. Gekko is the embodiment of corporate malfeasance, but also portrayed as a business guru. His glamor and power probably inspired a lot of young men to enter investment banking over the last two decades. As Gekko said, “It’s all about bucks, kid. The rest is conversation.”
Lesson: Greed is good. What’s worth doing is worth doing for money. Lunch is for wimps. If you need a friend, buy a dog. So goes the wisdom of Gordon Gekko, ruthless investor, legendary financier – and the star of one of the best movies ever made about money. This film also provides a great backdrop to the landscape that led to the financial crisis of 2008.
3. Glengarry Glen Ross (1992) – Times are tough. This is the ultimate real estate high pressure sales environment film where making money is the bottom line. A desperate group of Chicago investment property real estate salesmen suffer in a down market, a sales contest is launched and anyone who fails loses his job.
Now that the property bubble has burst, some real estate offices may soon seem a little bit more “Glengarry”. There’s no room for losers, only ‘closers’ will get the good sales leads. Some regarded this film as a critique of the impact of Reaganomics.
Lesson: Too much pressure to succeed can boil over into tragedy with unforeseen consequences.
With the upcoming premiere of the film “Wall Street – Money Never Sleeps” it got me thinking about movies with some kind of financial lesson. The financial side of making filmshasalways intrigued me. This year’s Oscars were yet again proof that the biggest budget doesn’t always give the best ROI. In 2010, the lowest grossing Oscar winning film in history – The Hurt Locker – beat out the highest grossing picture in history – Avatar.
Here’s my list of the top 10 movies ever made that have a financial lesson inside of them.
4. Maxed Out. Hard times. Easy Credit. The Era of Predatory Lending (2006) – This documentary shows how the modern financial industry really works. It explores America’s love with credit and leveraged debt and tells us why the poor are getting poorer and the rich getting richer. When Hurricane Katrina ravaged America’s coast, it revealed that America was far from the world’s wealthiest nation. It also highlighted America’s crumbling beneath a staggering burden of individual and government debt. Maxed Out shows how predatory lending was out of control, including credit cards pumped to college kids who had no income. This is a great movie. It’ll make you feel different about your money.
Lesson: It delivers a great lesson on how to borrow and shows why you don’t want to live on credit. Credit is the devil. Do you know anyone who got into trouble because they didn’t borrow too much money? Maxed Out paints a picture of a national nightmare which is all too real for most of us – out of control spending and an irrational use of credit.
5. Enron: The Smartest Guys in the Room (2005) – Before Bernie Madoff, there were Ken Lay and Jeff Skilling who ran the Houston energy firm that was going to reinvent how energy was going to be done in America. Enron was highly profitable, had a great amount of cash flow and earnings and the stock price soared. Its executives cashed out options worth millions and told employees their best 401K option was Enron stock. Thousands lost all their retirement savings because they put all their bets on one company. Took Enron 16 yrs to from 10b assets to 65b assets, but it took them 24 days to go bankrupt. It won the Academy Award for best documentary.
Lessons: Have a financial plan, have a discipline. If you have a stock that looks too good to be true and it just keeps going up, up, up, it’s probably too good to be true. Diversify, Diversify, Diversify. Don’t put all your eggs into one basket.
6. Working Girl (1988) – Melanie Griffith plays Tess McGill. Endearing 80s film. Ultimately she takes a job as a secretary but she wants to rise in investment world. Wants to rise to power, combines her business degree from night school w/ her street smart acumen & pulls of a mega-merger. Total fantasy. Prince charming happy ending w/ Harrison Ford. “I have a head for business and a body for sex.”, says Melanie Griffith’s character. Go back to night school, go back & get a degree. Go get educated, you’ll get leverage. No one can take your education away from you.
Lessons: Your education, your smarts can’t be wiped out in a recession. Your earning power is rooted in your skills, in your education. Provides an entertaining reminder that if you have something to offer your co. & they don’t seem too interested, then take your skills elsewhere. If you are a super powerful earner at one job, you can make yourself a super powerful earner anywhere.
7. Treasure of the Sierra Madre. 1948. Classic western cautionary tale about how not to launch a venture. If you took everything that Howard Dobbs & Kutan did in this movie: “Get rich quickly without a credible business plan.” “Badges, we don’t need no stinking badges.” Don’t swing blindly, don’t come up w/ a get rich quick scheme, don’t do a pyramid scheme, don’t sell products from your house to your friends or recruit your friends.
Lesson: In life, as in baseball, you’re gonna strike out. You don’t want to strike out blindly while your pursuing a huge home run. You gotta know your business, know your partners, know where you are in all of this.
8. Mr. Blanding Builds His Dream House (1948) – Was remade into The Money Pit, starring Tom Hanks & Shelly Long. Owning a home ain’t cheap. It can turn into a massively expensive ordeal. Home is really a money pit. Owning a home comes w/ a lot of responsibility, gotta have credit, gotta have a down payment, pay your bills, maintain the home, gotta know the risks up front. It’s expensive. You gotta know the worse case scenarios, all the risks, the downside.
Lesson: Shows how the American dream of owning a home can go terribly wrong. Home ownership is not for everybody and shouldn’t be promoted as such by the government.
9. Confessions Of A Shopaholic (2009) – About a chic who’s struggling with a debilitating obsession with shopping and has 12 maxed out credit cards. She unintentionally lands a job as a financial journalist and falls for a wealthy entrepreneur. Don’t buy a $400 watch because it quickly depreciates to nothing. I will buy a $4,000 Rolex – nothing less than a Rolex — because it can still be sold 10 yrs after you buy it for what you paid for it. You use credit to buy things of value: an education, a car to get you to work, (I prefer to buy 2-yr old used cars because it loses half its value up front when you drive it off the lot, but you can still get 50-60,000 miles out of it.)
Lesson: Only use credit for things that have value. Pay cash for everything else.
10. Brewster’s Millions (1985) – The ultimate spending spree is something that most of us have daydreamt about at some time. A minor league baseball player, Montgomery Brewster, (Richard Pryor) has to waste $30m in 30s days in order to inherit $300m; however, he’s not allowed to tell anyone about the $300m deal.
Lesson: How corruptible too much money can be and how difficult it can be to use it responsibly.
As a keen investor, you will know that the stock market is constantly changing. In 2008, it was estimated that the size of the world stock market was $36.6 trillion. It is ever growing and expanding, but also dipping and rising in value all the time.
These days you can invest in almost anything, from gold and silver on Bullion Vault to Real Estate. If you’ve invested in stocks and shares then you are going to want to check the stock market on a regular basis. We have found just a couple of the best stock apps about so you can track and manage your stocks right from your iPad.
This app by Value Prime, is a powerful stock analysis app which provides thorough analysis for a huge variety of stocks. In addition, it also helps you to judge stocks by providing statistics based upon risk, valuation and financial strength. The app has an archive of 6,700 stocks, and for each stock you are given a detailed overview of its state. The app is able to tell you everything about the stock, from its valuation rating and financial strength to its risk score and its sharpe ratio. It has a user-friendly interface which is loaded with tons of features.
Produced by Toughturtle LLC, StockWatch allows you to easily track your stocks from your iPad. It differs from StockGuru because this app is purely designed to help you track stocks you already own, rather than helping you make decisions on other stocks. The app was noted in Apple’s iTunes Rewind as one of the best apps of 2010. You can create portfolios and even make watch-lists so you never miss a thing. In addition, there is a news feed integrated in the app so you will always be in the know.
Emerging markets as a whole historically been attractive investment playgrounds for investors. I personally believe there are many diamonds in the rough out there for emerging markets picks, my two favorites are listed below:
Conglomerate 3M (NYSE: MMM)
Conglomerate 3M (NYSE: MMM) makes materials for about every industry from electronics to health care to mining and construction. Two-thirds of 3M’s sales come from outside the U.S., one-third specifically comes from emerging markets. Higher management for 3M expects this number to increase close to 50% by 2014. The company has dramatically increased it’s internal spending on research/development mainly focusing on creating products to go with the flow for emerging markets demand. If done successfully, this will dramatically increase sales and improve the companies prospective for the future. Last quarter alone, sales increased 10% as a whole and in sub-sectors like Asia and Latin America they rose 22% and 12% respectively. Overall, I believe 3M will rise to $110 per share in the next 12-months, a total yield of 17%.
Emerson Electric (NYSE: EMR)
Emerson Electric (NYSE: EMR) produces industrial components, electrical power systems, and various products to automate factories. Right now, the company is turning 17 cents on the dollar into operating profit, which is substantially higher than the industry average of 11 cents. Prices for raw materials are rising across the board, which will dramatically hurt profit margins for both EMR and it’s competitors. Higher management has taken it upon their own initiative to help combat this problem by launching their own personal line of locally engineered products to sell in both China and India which will help improve profit margins. Currently, the company is on an aggressive path to double sales in Asia to over $10 billion by 2015. Adding to this, they plan to increase sales in emerging markets by over 50%. If done correctly both will be great platforms for EMR to grow in the coming years. EMR’s individual share price has performed exceptionally in the past, the stock has nearly multiplied sevenfold in price over the past 20 years and currently they are selling at 18 times earnings. Adding to this EMR has a dividend yield of 2.2% making the investment more attractive to outside investors. As a whole, I believe EMR’s stock will soar in the next 12-months and I see it rising to $70 a share, a total yield of 21%.
Don’t be a stranger leave a comment below and let me know what you think or send them to my Twitter. Also remember to sign up for Stocks on Wall Street’s Monthly Newsletter.
When you set out to buy stocks online for the first time, you have to make a decision: what online stock broker to use? you might choose one of the top 10 online stock brokers or you might decide to go with one not on that list. The question is though, how safe is your money in any of these broker accounts?
A good example is E*Trade which has been having lots of difficulty in the last couple of years. you can see the graph showing the stock price reaching $24.00 in 2007 and going steadily down from there all the way to $1.60 today. That $1.6 price almost makes it a penny stock and it is a price I am very uncomfortable with.
E*Trade is a very well known online broker and they have the best interface I have ever used. I am not picking on them or saying they are risky and I wish I could put all my money in their accounts because I love the web site. however, I feel scared that the stock price is too low and something bad is going to happen. I hope I am wrong but we all have to sleep at night and so I have just withdrawn all the cash I have in the account and had them send a check. The key word in that last sentence is “cash”.
Please note that I have not sold any of the stocks I have in the account. That is because the stocks I own in my E*Trade account are not in jeopardy if E*Trade were to go bankrupt. Online stock brokers are just the conduit for the buys and sells and the stock I own or you own in any company is actually in the company and not in the online broker where you buy the stock.
Now you need to know that E*Trade and probably most every other online stock broker is part of the FDIC $250,000 insurance that guarantees your account up to that much. since the total of everything I have in my accounts is less than $250,000, I probably didn’t really need to withdraw the money because it would be insured even if they went bankrupt. As long as you have less than the $250,000 in any account, you should be safe.
In summary, any money you have directly in stocks or stock funds is invested in those individual companies and not in the online broker. If you have $1,000,000 in MSFT stock and the stock broker you use goes belly up, you are just fine because your money is in Microsoft and not in the now bankrupt online broker. however, if you have $500,000 in MSFT stock and another $500,000 in cash sitting in your account, you would stand to possibly lose $250,000 because only half of the $500,000 would be insured through FDIC. Of course, if you have one million dollars to invest you are probably not reading this blog trying to learn how to buy stocks.
Six months ago TheStreet busted out its top tech stocks for 2010. Here’s our mid-term report for three of them.
Internet behemoth Amazon AMZN-Q made our list of the year’s top tech stocks after leaving rivals like eBay trailing in its wake. after successfully navigating the recession, Amazon was seen as one of the few large-cap tech companies capable of major growth.
Investors, however, have been less than impressed with Amazon so far this year, although the market’s expectations may have been over-inflated.
Even good first-quarter results were not enough to drive the company’s stock upward, although disappointing guidance weighed on Amazon’s shares. overall, Amazon’s share price has dipped 0.98% over the last six months.
There are certainly some big hurdles in Amazon’s path. the strengthening dollar, for example, recently prompted Barclays Capital to trim its Amazon price target and EPS estimates. State taxation of Internet sales, the so-called Amazon Tax,could also prove a headache for online retailers.
Another threat looming on the horizon is Apple’s AAPL-QiPad, touted as a potential Kindle-killer.
Still, there are plenty of positives in the Amazon story. as of last month, the retail giant had reportedly sold 3 million Kindle e-readers, although exact figures have not yet been released. Amazon also clinched a recent deal to sell Kindles at retail giant Target.
The company’s acquisition of popular online shoe seller Zappos.com was also a shrewd move that bodes well for the future, and third-party sellers are expected to drive Amazon’s overseas sales.
Thomas Weisel recently initiated its coverage of Amazon with a Market weight rating and $135 price target. Amazon now holds a significant portion — 12% — of the total U.S. e-commerce market, according to the analyst firm.
Currently trading around $126.49, Amazon’s share dip could still spell longer-term upside for investors.
Described as a “mini-Microsoft” because of its dominant position in the Linux market, Red Hat RHT-N has enjoyed solid, if unspectacular, share gains this year. the company’s stock has risen 9.7 per cent during the last six months and the software maker is still getting plenty of analyst love.
Lazard Capital Markets recently initiated coverage of Red Hat with a buy rating and $35 price target.
“Red Hat is one of the best-positioned companies in mid-cap software,” explained analyst Joel Fishbein, in a note released earlier this month. “In our view, Red Hat’s recurring revenue model, high revenue visibility, and sticky customer base are under-appreciated.”
Red Hat, which competes with Microsoft MSFT-Q, Novell and Oracle, is seen as well-positioned to tap into some of tech’s biggest trends. these include virtualization, cloud computing and growing demand for middleware, a form of software that links different computer programs.
In March, the company posted strong fourth-quarter numbers, although its profit forecast fell short of analysts’ estimates, bringing down Red Hat’s stock.
M&A chatter also continues to swirl around the company, which is currently trading at around $31.90. There has been plenty of speculation about which firms might snap up Red Hat, with IBM and Oracle already touted as potential purchasers.
Lazard’s mr. Fishbein feels that the software maker remains an attractive M&A target, particularly given its share price. “Red Hat’s unique technology and business model position the company as an ideal acquisition candidate at a significant premium to current trading multiple,” he wrote, in his recent note.
VMware VMW-N is certainly living up to our call. Buoyed by international sales and growing license revenue, VMware blew past analysts’ estimates in its recent first quarter and gave strong guidance.
While there have been some fears about the stock’s valuation, VMware shares have risen more than 72% in the last six months. It’s currently trading around $71.72 and has plenty of fans.
“We continue to believe additional upside exists in VMware,” explained Brian Marshall, an analyst at Gleacher & Company, in a recent note. Marshall, who reiterated his VMware buy rating, also raised the company’s price target from $65 to $85, underlining the ongoing strength of virtualization technology.
Virtualization lets users divide physical hardware into multiple virtual chunks and has grown in popularity among users juggling a myriad of operating systems and applications. with companies also struggling with budget pressures, VMware and its rivals such as Microsoft and Citrix are pushing virtualization as a way for firms to reduce the amount of server and storage hardware within their data centers.
Majority-owned by storage giant EMC EMC-N, VMware is also expected to tap the ongoing PC refresh with its desktop virtualization software.
The Internet is a great tool for just about any business out there, but when it comes to the stock market, it has completely changed the way we do business. We no longer have to be present in the rush of Times Square or hire stockbrokers do to all of our work for us with little correspondence, we now have the immediacy of online purchasing capabilities. We can see instantly what is going on with our investments, and this goes for all hours of the night and morning.
The best option for investing in the market is to buy stock online. Buying stocks online is the only way people are doing it these days, and there is a great number of reasons way this is such an advantage to the users. We already mentioned what a great resources it is in terms of immediacy without the unnecessary time to relay the information via older technologies. this movement shifted almost overnight in this no brainer new way of doing things. Not only does it make the process of finding which ones you want to throw yourself into, but it a great asset in doing your homework.
If you want to buy stock online, you also want to search out each individual company you are looking at having a part in. With this resource you can connect with thousands of other buyers who have had experience with this stock and get some personal insights on why or why not these guys are worth it. You can also have discussions about the future of the company, read up on how well the company is run and managed, and get much more feedback than you would ever have hoped to acquire by not buying online.
It seems as if every year has its own recommendations for buying particular penny stocks to kick off the new Year on the right foot. and 2010 has been no exception to this rule.
So if you are hungry to find some promising penny stocks to invest in this year, try looking at the following suggestions. we make no promises that they will make you a lot of money; as always you should do your own diligent research and see what you can do with them. But they should at least be inspiring to you and give you an idea of what is out there.
First off let’s start with Fannie Mae. Otherwise known as the Federal National Mortgage Association (or FNM) this has understandably been a quiet stock of late. But many people are suggesting that when the housing market picks up again there could be some good gains to be made here. The current trade is at 1.01, although over the last year it has gone as high as 2.13 and as low as 0.35.
Elsewhere there are the PPBV stocks. This is the Purple Beverage Company, and we have very little information to go on here. The stocks however are currently rated at 0.0015 each. it suffered greatly when the stock market crashed in 2008, as it had achieved a high of eight dollars a share around that time. Needless to say though, the company is still around and still doing well, so those undervalued shares are sure to fly back up again at some point.
Finally we have WDRP. This is the stock belonging to Wanderport Corp. it is currently sitting at 0.0345 but since it was sitting at 0.008 not so long ago you can see that it is truly making big improvements. and some people think it will go much higher than three and a half cents per share as well.
So keep an eye on the news and developments for these penny shares and use that information to help you decide when to buy and sell these shares. many people do not consider penny shares to be worth hanging onto for a long period of time. But as we can see here you may not have to. some shares can go up in value by a significant amount in a short space of time. The secret is in knowing which penny stocks are on the rise and making the most of them while you can.
Why you should Buy Stocks and Invest in the Markets? Plain and simple, buying stocks is the easiest way to create wealth. Investing is relatively simple and the rewards are great. By Investing in the Markets it will open up the world to you offering you more money to do what you want. Money gives you opportunities so investing will allow you to explore your opportunities whether they are retiring in a beach house in Mexico, paying for child’s education, or just for traveling the globe. Realistically, unless you have a top-notch salary, investing in the Stock Market is the only true way to reach financial independence.
Benefits of Investing and Power of Compounding
Lets put it real simple to show you the benefits of investing. Say you put $2,000 of your savings into the stock market and invest within the S&P 500. Well the S&P’s historical average is 10% and would make your 2,000 worth $34,898.80 after 30 years. Now do you see the gain from investing? On the contrary if you put that same amount of money into a savings account your $2,000 would only be worth $3,622.72 30 years later. Quite a difference huh? This number will shock you even more. If you invest $1,000 a year in the S&P 500 after 45 years it will have grown to over one million dollars. Overall you only added $46,000 over the time but compound interest and solid investments did the job for you. Below is a graph that shows the power of investing and why you should put your money in the Stock Market rather than a CD or Bond. Historically overtime CD’s and Government Bonds have averaged around 5%. The Stock Market has averaged 10% over the same period and if you learned how to trade yourself or followed Stocks on Wall Street you could easily achieve 15%-20%.
Shocking what a few percentage points can do and why it pays off to take some risk. Remember you are a long-term investor so you’ll go through the bull markets and bear ones but overall your money stays put and grows exponentially.
Time Value of Money
Lets say your parents start you investing when your 15 years old with a simple $100 dollar bill. Look how that simple bill will grow:
As you can see the reason you buy stocks and invest in the markets is to grow your money so you can retire safely. Buying stocks is the fastest way to grow your money but it comes with assuming lots of risk so be careful.