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Today’s Best Investment ? Buy a house

February 9, 2011 How to Beat the Looming Inflation Tsunami

How to Beat the Looming Inflation Tsunami

[Editor’s Note: He predicted the financial crisis and the bull markets in gold and silver, and he “called” the bear-market bottom. Now Money Morning’s Martin Hutchinson is sounding the inflation alarm – and has identified the one move investors can make to beat the looming inflation tsunami.]

By Martin Hutchinson, Contributing Editor, Money Morning

Inflation is coming our way. Make no mistake about it.

This insidious increase in the general level of prices is currently rattling around in the world’s emerging markets – causing China and Brazil to put up interest rates and India to try and suppress it with price controls. It’s beginning to appear in Britain, which had a similar crash to the United States, but where the currency has been somewhat weaker.

Within the next six months – while the U.S. Federal Reserve is still buying U.S. Treasury bonds under its “quantitative easing” policy – this inflation tsunami will hit the United States.

Inflation is a lot like the unwelcome houseguest: Once you invite it into your home, you can’t seem to get it to leave.

The key catalysts for the inflationary visitor that’s headed our way are the silly-money policies that the Fed and other central banks have been pursuing. Those policies have inflated yet another massive bubble – this one in the commodities sector. All the cheap money that’s right now sloshing around the global markets have sent commodity prices into the stratosphere, and are causing emerging-market economies to grow like crazy.

Inflation was especially virulent in the 1970s, when rising prices and high unemployment combined to cause the particularly odious form known as “stagflation.” It certainly didn’t help that it took policymakers almost the entire decade to face up to the fact that inflation wouldn’t go away on its own.

Indeed, it wasn’t until we got Paul A. Volcker in as Fed chairman in 1979 that inflation even had a worthy foe. It was Volcker who eventually crafted the aggressive policies that were required to vanquish the inflationary pressures that had gripped the U.S. economy for so long.

This time around, unfortunately, the U.S. central bank appears to be even more determined to ignore inflation’s early warning signs, while the banks and the politicians will fiercely resist higher interest rates, the only known remedy, because of the dangers of a further housing collapse.

So we can expect inflation to be with us for several years this time, too. In fact, expect it to get worse for the next three to four years, while Ben S. Bernanke remains at the helm of the nation’s central bank. Bernanke’s term as Fed chairman ends in January 2014; hopefully, whoever is the U.S. president at that point won’t reappoint him.

But we’d better arrange matters so we don’t lose out from it.

A Tale of Caution

As investors, the main problem we have with inflation is that any contract written in nominal dollars will rapidly decline in value. Long-term bonds are the classic losers from periods of inflation; their nominal value declines, and their prices decline, as well, because inflation pushes up interest rates.

My Great-aunt Nan, a splendid lady, retired at 65 in 1947 – at the beginning of Britain’s postwar inflationary surge, with ample retirement savings – invested in a 3.5% War Loan, the normal safe haven for British savers in the 19th and early 20th centuries.

She made it into the 1970s, bless her. But by the time she died, not only was the income from her War Loan worth a quarter of its 1947 value, but its capital value had also declined in nominal terms to about 30% of its 1947 level, as interest rates had risen from 3½% to 12%.

(Little wonder the British newspaper, The Independent, once wrote that “over the years … the War Loan is a monument to the poor investment value of government stocks.”)

Don’t let this happen to you!

The One Move to Make Now

If your money is in bonds – whether those bonds are U.S. Treasuries, municipals or corporates – move it somewhere else.

If you have the sort of solid final-service pension that companies used to give out and the government still does, check the inflation protection. If the pension doesn’t have a 100% protection against inflation – however high it goes – you have a problem.

In the face of rampant inflation, many stocks won’t be an answer, either. Theoretically, if your company is making tangible things from tangible factories, or providing tangible services (and not just sitting on a bunch of loans and bonds), then its earnings (and therefore its overall value) should rise with prices. In practice, however, this often doesn’t happen.

For one thing, many institutional investors use the so-called “Fed Rule” for determining share price values, which divides the expected future earnings stream by the current interest rate (Future Earnings Stream/Current Interest Rates = Share Price Value).

That’s why stocks behaved so spectacularly in 1982-2000: As interest rates came down the “denominator” of that value equation got smaller and smaller – which made it easy for the share price value to go up.

But there’s a problem: That formula uses “nominal” – not “real” – interest rates. It also fails to account for cuckoo Fed policies, so if interest rates are exceptionally low for a long period, the formula says share prices should go up and up. And if the interest rate is close to zero, the share “value” should be close to infinity!

With the return of inflation, nominal rates will have to increase to keep pace. And real interest rates will have to do the same as Volcker-esque monetary policies are used to get inflation under control. So share prices will almost certainly decline sharply in real terms, just as they did from 1966-82, even though nominal share prices remained approximately flat.

Gold and silver are a good speculation in times of inflation, but not a good investment. Before 1914, when the world was on the “gold standard,” the gold market was approximately in equilibrium at a price of just under $19 per ounce. U.S. consumer prices have increased 22-fold since then, so a price of $418 per ounce today would be fully justified. You see the problem?

In practice, the increase in world population – by about 3.7 times – since 1914 should have caused the gold price to increase approximately in tandem. That’s because the world’s gold supplies have not increased, but its population has. That would justify a price of around $1,550 today.

This calculation suggests gold is a good buy currently, but if inflation returns and money stays cheap, the price of gold is going to be far above that level quite soon, and buying gold will have become a very speculative activity. At $3,000 per ounce, gold is a hugely risky investment.

What’s the best investment to make right now? A house.

The housing market has bottomed out – or, at worst, is close to doing so. And you can get a fabulous rate on a 30-year mortgage, making you benefit from inflation just as bondholders lose from it.

The combination of a relatively depressed housing market and cheap money is uniquely favorable, so you should take advantage of it. For the best investment, you can narrow the recommendation further:

  • Don’t buy around Washington: The market has been pushed up by the flood of bureaucrats and lobbyists that have taken up residence inside the Beltway – an influx that will reverse itself as the U.S. budget is finally brought under control.
  • Don’t buy in Manhattan or the Hamptons: Prices have been pushed up by all the silly money sloshing about in financial services, which will disappear with higher interest rates.
  • Don’t buy in Silicon Valley: That advice holds true there, and anywhere else where local wealth has been inflated by stock options.
  • Do buy in a medium-sized town: Make sure that town is in an area where the economy is not dependent on finance, the government or energy/commodities.
  • Do buy an old house, instead of a new house: Buy an old rather than a new house – the supply of old houses is fixed, whereas new McMansions will appear in profusion and flood the market while interest rates remain low (developers all have large land banks they want to develop.)
  • Do take a 30-year fixed-rate mortgage: In a time of inflation and low interest rates, a long-term, fixed-rate mortgage is a gift from above.
  • Don’t overextend yourself financially: There could be big recessions in the next few years, so you need to be able to make the payments without selling the house.
  • Do be prepared to rent, rather than sell: If you have to move in the next few years, become a landlord and rent the house out instead of selling it outright. Rents have been pretty well flat in the last 10 years; they are likely to beat inflation in the next 10 years, since higher interest rates tend to push rents higher.

Readers often wonder if we follow our own advice. Money Morning has a very good rule, which says that I should not deal in any stocks that I recommend to you. But in this case, I’m happy to be able to report that I am practicing what I preach – I’m taking advantage of the current climate to relocate … and am in the process of buying a house!

[Editor’s Note: If investors have to now worry about the “I-word” – inflation – they’re also going to have to worry about the “R-word” – retirement.

Here’s the problem: The longer you work, the more you can save – and the longer the rampant inflation we’re expecting will have to work on your nest egg.

But here’s the solution: Boost your rates of return.

That’s actually just as easy as it sounds. You just have to have the right strategy – and the right investments. And as a subscriber to The Money Map Report, our monthly affiliate, you can count on getting both. Find out by clicking here to read a report that details this strategy.]

February 9, 2011

How to Beat the Looming Inflation Tsunami

How to Beat the Looming Inflation Tsunami

[Editor’s Note: He predicted the financial crisis and the bull markets in gold and silver, and he “called” the bear-market bottom. Now Money Morning’s Martin Hutchinson is sounding the inflation alarm – and has identified the one move investors can make to beat the looming inflation tsunami.]

Inflation is coming our way. Make no mistake about it.

This insidious increase in the general level of prices is currently rattling around in the world’s emerging markets – causing China and Brazil to put up interest rates and India to try and suppress it with price controls. It’s beginning to appear in Britain, which had a similar crash to the United States, but where the currency has been somewhat weaker.

Within the next six months – while the U.S. Federal Reserve is still buying U.S. Treasury bonds under its “quantitative easing” policy – this inflation tsunami will hit the United States.

Inflation is a lot like the unwelcome houseguest: Once you invite it into your home, you can’t seem to get it to leave.

The key catalysts for the inflationary visitor that’s headed our way are the silly-money policies that the Fed and other central banks have been pursuing. Those policies have inflated yet another massive bubble – this one in the commodities sector. All the cheap money that’s right now sloshing around the global markets have sent commodity prices into the stratosphere, and are causing emerging-market economies to grow like crazy.

Inflation was especially virulent in the 1970s, when rising prices and high unemployment combined to cause the particularly odious form known as “stagflation.” It certainly didn’t help that it took policymakers almost the entire decade to face up to the fact that inflation wouldn’t go away on its own.

Indeed, it wasn’t until we got Paul A. Volcker in as Fed chairman in 1979 that inflation even had a worthy foe. It was Volcker who eventually crafted the aggressive policies that were required to vanquish the inflationary pressures that had gripped the U.S. economy for so long.

This time around, unfortunately, the U.S. central bank appears to be even more determined to ignore inflation’s early warning signs, while the banks and the politicians will fiercely resist higher interest rates, the only known remedy, because of the dangers of a further housing collapse.

So we can expect inflation to be with us for several years this time, too. In fact, expect it to get worse for the next three to four years, while Ben S. Bernanke remains at the helm of the nation’s central bank. Bernanke’s term as Fed chairman ends in January 2014; hopefully, whoever is the U.S. president at that point won’t reappoint him.

But we’d better arrange matters so we don’t lose out from it.

A Tale of Caution

As investors, the main problem we have with inflation is that any contract written in nominal dollars will rapidly decline in value. Long-term bonds are the classic losers from periods of inflation; their nominal value declines, and their prices decline, as well, because inflation pushes up interest rates.

My Great-aunt Nan, a splendid lady, retired at 65 in 1947 – at the beginning of Britain’s postwar inflationary surge, with ample retirement savings – invested in a 3.5% War Loan, the normal safe haven for British savers in the 19th and early 20th centuries.

She made it into the 1970s, bless her. But by the time she died, not only was the income from her War Loan worth a quarter of its 1947 value, but its capital value had also declined in nominal terms to about 30% of its 1947 level, as interest rates had risen from 3½% to 12%.

(Little wonder the British newspaper, The Independent, once wrote that “over the years … the War Loan is a monument to the poor investment value of government stocks.”)

Don’t let this happen to you!

The One Move to Make Now

If your money is in bonds – whether those bonds are U.S. Treasuries, municipals or corporates – move it somewhere else.

If you have the sort of solid final-service pension that companies used to give out and the government still does, check the inflation protection. If the pension doesn’t have a 100% protection against inflation – however high it goes – you have a problem.

In the face of rampant inflation, many stocks won’t be an answer, either. Theoretically, if your company is making tangible things from tangible factories, or providing tangible services (and not just sitting on a bunch of loans and bonds), then its earnings (and therefore its overall value) should rise with prices. In practice, however, this often doesn’t happen.

For one thing, many institutional investors use the so-called “Fed Rule” for determining share price values, which divides the expected future earnings stream by the current interest rate (Future Earnings Stream/Current Interest Rates = Share Price Value).

That’s why stocks behaved so spectacularly in 1982-2000: As interest rates came down the “denominator” of that value equation got smaller and smaller – which made it easy for the share price value to go up.

But there’s a problem: That formula uses “nominal” – not “real” – interest rates. It also fails to account for cuckoo Fed policies, so if interest rates are exceptionally low for a long period, the formula says share prices should go up and up. And if the interest rate is close to zero, the share “value” should be close to infinity!

With the return of inflation, nominal rates will have to increase to keep pace. And real interest rates will have to do the same as Volcker-esque monetary policies are used to get inflation under control. So share prices will almost certainly decline sharply in real terms, just as they did from 1966-82, even though nominal share prices remained approximately flat.

Gold and silver are a good speculation in times of inflation, but not a good investment. Before 1914, when the world was on the “gold standard,” the gold market was approximately in equilibrium at a price of just under $19 per ounce. U.S. consumer prices have increased 22-fold since then, so a price of $418 per ounce today would be fully justified. You see the problem?

In practice, the increase in world population – by about 3.7 times – since 1914 should have caused the gold price to increase approximately in tandem. That’s because the world’s gold supplies have not increased, but its population has. That would justify a price of around $1,550 today.

This calculation suggests gold is a good buy currently, but if inflation returns and money stays cheap, the price of gold is going to be far above that level quite soon, and buying gold will have become a very speculative activity. At $3,000 per ounce, gold is a hugely risky investment.

What’s the best investment to make right now? A house.

The housing market has bottomed out – or, at worst, is close to doing so. And you can get a fabulous rate on a 30-year mortgage, making you benefit from inflation just as bondholders lose from it.

The combination of a relatively depressed housing market and cheap money is uniquely favorable, so you should take advantage of it. For the best investment, you can narrow the recommendation further:

  • Don’t buy around Washington: The market has been pushed up by the flood of bureaucrats and lobbyists that have taken up residence inside the Beltway – an influx that will reverse itself as the U.S. budget is finally brought under control.
  • Don’t buy in Manhattan or the Hamptons: Prices have been pushed up by all the silly money sloshing about in financial services, which will disappear with higher interest rates.
  • Don’t buy in Silicon Valley: That advice holds true there, and anywhere else where local wealth has been inflated by stock options.
  • Do buy in a medium-sized town: Make sure that town is in an area where the economy is not dependent on finance, the government or energy/commodities.
  • Do buy an old house, instead of a new house: Buy an old rather than a new house – the supply of old houses is fixed, whereas new McMansions will appear in profusion and flood the market while interest rates remain low (developers all have large land banks they want to develop.)
  • Do take a 30-year fixed-rate mortgage: In a time of inflation and low interest rates, a long-term, fixed-rate mortgage is a gift from above.
  • Don’t overextend yourself financially: There could be big recessions in the next few years, so you need to be able to make the payments without selling the house.
  • Do be prepared to rent, rather than sell: If you have to move in the next few years, become a landlord and rent the house out instead of selling it outright. Rents have been pretty well flat in the last 10 years; they are likely to beat inflation in the next 10 years, since higher interest rates tend to push rents higher.

Readers often wonder if we follow our own advice. Money Morning has a very good rule, which says that I should not deal in any stocks that I recommend to you. But in this case, I’m happy to be able to report that I am practicing what I preach – I’m taking advantage of the current climate to relocate … and am in the process of buying a house!

[Editor’s Note: If investors have to now worry about the “I-word” – inflation – they’re also going to have to worry about the “R-word” – retirement.

Here’s the problem: The longer you work, the more you can save – and the longer the rampant inflation we’re expecting will have to work on your nest egg.

But here’s the solution: Boost your rates of return.

That’s actually just as easy as it sounds. You just have to have the right strategy – and the right investments. And as a subscriber to The Money Map Report, our monthly affiliate, you can count on getting both. Find out by clicking here to read a report that details this strategy.]

Anúncios

Setor deve refletir processo de crescimento da economia

 

Apaixonados por construção: Gestores preveem expansão forte das empresas imobiliárias amparada no aumento do crédito e da massa salarial da classe média.

Setor deve refletir processo de crescimento da economia

    Por Daniela D’Ambrosio, de São Paulo
    24/06/2010

Gustavo Lourenção/Valor
 
Anibal Alves, superintendente de renda variável da Bram: preferência por MRV e PDG Realty de olho na baixa renda

O setor de construção civil é visto como um dos que melhor representa a expansão da economia brasileira. Na avaliação dos gestores, as empresas imobiliárias – amparadas pelo aumento do crédito – poderão capturar todo o ganho de massa salarial que a classe média deve ter nos próximos anos. O programa habitacional do governo Minha Casa, Minha Vida, segundo os especialistas, veio ampliar o financiamento e adicionar demanda a um mercado já favorecido pelo cenário macroeconômico.

O ambiente também é considerado propício para investimento por outro motivo: as construtoras e incorporadoras estão em plena fase de aceleração do crescimento. A divisão de gestão de ativos do Itáu Unibanco aposta nos resultados que as companhias ainda estão para apresentar. Segundo Marcelo Mizrahe, analista e gestor do fundo de infraestrutura do banco, entre 2006 e 2009, o lucro antes dos juros, impostos, depreciação e amortização (lajida) das empresas abertas cresceu quase três vezes entre 2006 e 2009. Se o período analisado for de 2008 a 2012, esse aumento chega a seis vezes.

A elevação do lucro, diz o gestor, deve ser equivalente. “Não existe bolha imobiliária, é uma tendência estrutural de longo prazo”, diz Guilherme Rebouças, responsável por fundos diferenciados do Itaú Unibanco. Em 2006, havia uma única empresa do setor, a Cyrela, com faturamento acima de R$ 1 bilhão. Apenas três anos depois, um grupo de oito companhias ultrapassou o almejado patamar, algumas com folga.

Clécius Peixoto, diretor de renda variável da Vinci Gas Investimentos, segue o mesmo raciocínio: “A aceleração dos lançamentos a partir do segundo semestre do ano passado e este ano vai gerar muito caixa no ano que vem”, afirma. Para este ano, as grandes do setor estimam lançamentos na casa de R$ 3 bilhões cada uma. As maiores esperam uma evolução média de 50% nos lançamentos este ano, mas em alguns casos, como a Gafisa, o crescimento projetado chega a 95%

“A estrutura de capital das empresas também ficou muito boa depois das captações”, acrescenta Peixoto. No ano passado e início deste ano, um grupo de mais de seis empresas fez uma nova rodadas de ofertas de ações – a maioria muito bem-sucedida. Calcula-se que os “follow-on” tenham injetado mais de R$ 10 bilhões nas empresas de construção entre 2009 e 2010.

O potencial de expansão do setor, sob vários aspectos, é muito grande: o crédito imobiliário no Brasil ainda representa apenas 3% do PIB, contra 13% no México, 18% no Chile e 70% nos países desenvolvidos. O aumento do crédito também sustenta esses argumentos. Em 2003, de acordo com dados do Itaú Unibanco, cerca de 120 mil novas unidades foram financiadas.

No ano passado, esse número chegou a 600 mil (sendo 275 mil dentro do Minha Casa, Minha Vida). “O programa deu ao setor a certeza que teria dinheiro para financiar a obra e a garantia de que ficariam com o cliente”, diz Marcelo Mizrahe. O analista explica que a crise ensinou às empresas que os lançamentos de imóveis deveriam estar vinculados tanto ao financiamento à construção, quanto ao cliente. Muitas companhias tiveram problemas justamente por lançar sem essa garantia e, com o revés do mercado, tiveram problemas.

Por conta do programa, as empresas com foco ou participação importante na construção popular entraram no radar dos gestores, mesmo depois da forte valorização do ano passado. “Gostamos de MRV e PDG Realty, que é dona da Goldfarb, porque elas sabem atuar na baixa renda”, afirma Herculano Alves, diretor de renda variável da Bradesco Asset Management.

O aumento recente das taxas de juros, na opinião dos gestores, não é um problema, já que o crédito imobiliário está barateando por conta da concorrência com a Caixa Econômica Federal. Além disso, o índice de referência no crédito imobiliário é a TR e não o CDI.

Além de o setor de construção estar presente nos fundos passivos e ativos de índice, começam a surgir também os fundos setoriais de construção, baseados no índice imobiliário, criado pela BM&FBovespa em janeiro de 2009. O fundo de construção do Banco do Brasil teve o maior retorno entre os fundos de ação do banco no ano passado: com mais de 200% de retorno, chamou a atenção dos cotistas. Resultado: com um patrimônio de R$ 152 milhões no fim de maio, só perdeu para o de siderurgia, com R$ 200 milhões. Para efeito de comparação, o fundo de energia tinha R$ 76 milhões e o de bancos, R$ 65 milhões.

Jovens Realizam mais cedo o sonho da casa própria

jovens realizam mais cedo sonho da casa propria Estadao 23052010

Reasons to invest in Brazil – Forbes – April 2010

April 22, 2010
Is a Brazilian Bubble About to Burst?


Dear Investor:

There are many people out there lamenting the fact that they didn’t buy into booming Brazil months and even years ago. As many people are aware, you would have beat the Dow 2-to-1 over the last 12 months by investing in Brazil.

One of  the most popular Brazilian ETFs, iShares MSCI Brazil (EWZ) was up 85%, while the SPDR DJIA ETF (DIA) was up a not-too-shabby 40% in one year’s time.

But you are probably thinking that the Brazil stock market is partied out. Or as they say in Rio, “O Carnaval acabou.”

Not so! says Rudy Martin, editor of Latin Stock Investing, one of Forbes newest partners. Rudy believes there is more partying ahead for Brazilian investors.

At the beginning of this year, Martin published a report on the Brazilian Bonanza and highlighted several trends that are driving Brazil toward becoming one of the top 5 economies in our lifetime, along with China and India.

Below are five more good reasons to invest in Brazil now, excerpted from the current edition of Latin Stock Investing.

For actionable stock ideas including  a copy of Rudy Martin’s new Special Investment Report “3 Hot Brazilian Stocks,” please click here.

  1. Low Earnings Multiples: The average U.S. stock sells at 17 times this year’s and 15 times next year’s earnings. In contrast, Brazilian stocks are selling at 12.5 times earnings, or 20% less than U.S. stocks. The average earnings increase for Brazilian stocks is 15%-20%, and that assumes no major appreciation in the Brazilian currency.Alternatively, if you believe forecasts for target prices, then there is another 20% to 40% appreciation potential for the average among the 70 stocks I track in the Latin Capital Market Stock Index. Other benchmarking methods, such as price to sales/growth and relative dividend yield, generate even higher theoretical prices.Click here for the name of a Brazilian company that provides necessary utilities to 366 municipalities in the State of Sao Paulo. Its stock trades on the NYSE at less than 8 times earnings!
  2. Stable Currency: The strong Brazilian currency is both a blessing and a curse. The Brazilian real currency rallied by 32% in 2009, the biggest advance among the 16 major currencies. To combat a further rise in the real, the government imposed a 2% tax on foreign capital inflows into equities and fixed-income investments. There is enough demand for this currency that the country is now running current account deficits. The Brazilian Central Bank is forecasting a 2010 current account deficit of $29 billion. Fortunately, Brazil has $243 billion in foreign exchange reserves to help exporters and the financial system deal with short-term liquidity disruptions.
  3. Reasonable Interest Rates: Let’s put things in relative perspective. Obviously in the U.S., with near-zero interest rates and a highly leveraged consumer base, a double-digit interest rate would choke the economy. But we are talking about Brazil now. Five years ago, Brazil’s central bank benchmark interest rate was 20%! Today rates sit at a low of 8.75%. The country’s inflation rate is now over 5% and that’s the highest it’s been in 10 months. Prices for Brazilian exports are rising from both a stronger currency and customer demand. The 90% spike in iron ore prices clearly points out that the Brazilian economy is heating up. Expect the government to soon raise the overnight bank lending rate to discourage inflation and speculation.

  4. High Economic Growth: The IMF forecasts that Brazil’s economy will grow by 4.7% this year and another 3.7% next year. Brazil was one of the economies least hit by the global financial slowdown. With the surge in commodity prices, growth estimates have risen to nearly 6%. The wealth is spreading to middle class Brazilians, but there is still a long way to go. On a per capita income basis, Brazilians still have to catch up with their richer neighbors. The IMF calculations give the average Brazilian $10,500 of income vs. $14,000 for Chileans. The OECD just invited Chile to join the list of richest nations, the first Latin American nation with the “developed” status.Yes, Brazil is still very much a developing economy, especially vs. the United States. Young people and those over 65 tend to be economically dependent or live off investments. Only 30% of the population is either less than 14 years or over 65. In contrast, in the U.S., 35% of the population is out of the 14-65 range. So in effect, the U.S. has more dependents in its economy than Brazil does. And this difference will get bigger as Americans on average live six years longer to age 78. So what do rising income and a growing population add up to? A strong Brazilian economy.Click here for an Brazilian Small-Cap ETF Martin thinks is poised for outstanding performance.

  5. A Shortage of Homes: Believe it or not, there is a housing shortage in Brazil estimated at 5.8 million, according to Brazil’s Minister of Cities. There’s money to be made from this real estate gap. Cyrela Brazil Realty, Brazil’s largest developer, reported 2009 earnings that were 2.6 times higher than in 2008. Rudy Martin’s favorite Brazilian developer, whose shares trade on the New York Stock Exchange, just raised nearly $600 million in a stock offering to take advantage of this growth opportunity. Over the last year, this stock has split and doubled!Click here for immediate access to the name of this NYSE-listed Brazilian property developer in Latin Stock Investing’s current  newsletter.So next time someone mentions a Brazilian bubble, remember that we have just been through the first serious correction in Brazilian stocks in the last five years. Those who had the courage to buy on dips did extremely well.

Rudy Martin’s Latin Stock Investing Newsletter just issued its April report which contains:

  • 12 Latin American growth stock buys
  • 9 yield rich dividend stocks to purchase
  • 4 Exchange-Traded Funds recommendations

All are poised to capitalize on Brazil’s and other Latin American countries growth. Click here for immediate access.

Plus if you act today, you will also gain access to 2 Special Investment Reports:

  • “3 Hot Brazilian Stocks
  • “Latin Capital Markets 101”

Click here to download these Special Investment Reports.

Yours for profitable investing,

Charles Morgan
Associate Publisher
Forbes Newsletters

Construção civil será destaque em 2010

De Olho na Bolsa:

Construção civil será destaque em 2010

    Daniele Camba
    28/12/2009

Colunista

Financiamentos imobiliários com prazos mais longos, programa Minha Casa Minha Vida do governo, recuperação econômica com o fim da crise financeira internacional, além da expansão da renda e do emprego. Esses são fatores que fizeram com que o setor de construção civil tivesse um bom desempenho neste ano e, para 2010, espera-se que as construtoras se destaquem ainda mais. Essa é a opinião de algumas corretoras. No caso da Gradual Investimentos essa ideia é ainda mais forte. “O setor de construção civil deve ser o que mais dará retorno no ano que vem”, afirma Paulo Esteves, chefe da área de análise da Gradual Investimentos.

Foto Destaque

O crescimento do crédito, especialmente das linhas de mais longo prazo, a continuação do aumento da renda e do nível de emprego serão os pilares para a melhora do cenário das construtoras e, consequentemente, para as suas ações em bolsa. Já com relação às taxas de financiamento, a expectativa é de que elas caiam em 2010. Atualmente, um financiamento imobiliário de 35 anos possui uma taxa média de 10% ao ano. No próximo ano, essa taxa pode cair para algo entre 9% e 7,5% ao ano, uma redução significativa, estima Esteves.

Os números mostram o aquecimento do setor imobiliário. “Em conversas com as construtoras, elas dizem que a demanda está tão forte que em uma semana vendem 70% das unidades de um lançamento”, diz Esteves. Ele tem percebido a efervescência do setor por experiência própria. “Eu já fui procurado por vários corretores com boas oportunidades de negócios, tanto é que eu mesmo estou comprando um outro imóvel”, confessa Esteves.

Foto Destaque

Além dos fatores macroeconômicos, a insatisfação dos investidores com os ganhos da renda fixa deve ser um importante empurrão para o setor imobiliário. Com retornos mais modestos, os investidores sairão da renda fixa tradicional e uma parte desses recursos tende a ir para investimentos ligados ao setor imobiliário, desde a aplicação em fundos imobiliários até a aquisição dos imóveis em si.

Mesmo a retomada do processo de alta da taxa de juros Selic, prevista para ocorrer em meado do ano que vem, não será suficiente para mudar essa migração de recursos da renda fixa para outras formas de investimento, acredita o chefe de análise da Gradual. A projeção da corretora é que a taxa Selic termine 2010 em 10,75% ao ano, dos pontos percentuais acima do nível atual. Dentro do setor imobiliário, as principais recomendações da Gradual são os papéis da Eztec – uma construtora de menor porte, mas extremamente descontada se comparada às demais ações do segmento – e da Brookfield – a única multinacional listada em bolsa, bem estruturada e com acesso a um capital mais barato, por intermédio do seu controlador internacional -, explica Esteves.

Outros setores

A expansão da renda e do emprego, juntamente com a recuperação econômica, vai impactar positivamente outras empresas ligadas ao mercado interno. Entre elas estão as que fazem produtos para a população de massa, como alimentos, carnes e bebidas. Esteves cita alguns nomes como Brasil Foods, Pão de Açúcar, M. Dias Branco, AmBev e os frigoríficos, sendo que as duas primeiras estão entre as principais recomendações da Gradual.

Já para o Ibovespa, a projeção da corretora é de 81 mil pontos para o fim de 2010, o que significa uma valorização de 19,84% em relação ao fechamento da última quarta-feira, aos 67.588 pontos. Esteves afirma que alguns clientes acharam o número acanhado demais até porque existem projeções que beiram os 90 mil pontos. Esteves explica: “Os 81 mil pontos devem ser comparados aos 62 mil pontos que projetávamos para o fim deste ano e não aos 67 mil pontos atuais”, diz. “Essa diferença entre os 62 mil e os 67 mil já é uma antecipação de um tanto que deveria subir em 2010.”

Daniele Camba é repórter de Investimentos

E-mail: daniele.camba@valor.com.br

World’s Most Expensive Office Markets Get Cheaper (Update3)

World’s Most Expensive Office Markets Get Cheaper (Update3)

By David M. Levitt and Simon Packard
Dec. 1 (Bloomberg) — The world’s most expensive office markets got a little cheaper this year.

More than 130 cities worldwide had declines in rent expenses in the year ended Sept. 30, CB Richard Ellis Group Inc. said in a report today. Almost 50 cities reported declines of more than 10 percent. Rental costs fell about 30 percent in Midtown Manhattan, 53 percent in Singapore and 41 percent in central Hong Kong. Overall, rents fell an average 7.7 percent across 179 markets worldwide.

“The places that went up the fastest and highest also came down the fastest and at greater depth,” said Raymond Torto, Boston-based chief economist for CB Richard Ellis, the largest publicly traded broker. “You party Saturday night and you pay for it on Sunday morning. That’s true across the globe.”

The global recession and credit crisis are pushing down office rents as companies pare jobs. About 1.93 million job cuts have been announced worldwide this year, data compiled by Bloomberg show. In the U.S., the unemployment rate jumped to 10.2 percent in October, the highest level since 1983.

Singapore and Hong Kong are struggling to pull themselves up from recession, according to CB Richard Ellis. The pace of rent declines in Singapore eased in the third quarter, suggesting “an improvement in business confidence,” the report said. In Hong Kong, rents for top-quality space ended a yearlong decline in the third quarter for similar reasons, according to the survey.

West End Costs

London’s West End district retained its position as the world’s most expensive office location, Los Angeles-based CB Richard Ellis said. Offices there cost $184.85 a square foot. That’s down 26 percent from a year ago in U.S. dollars or 18 percent in pounds.

With the exception of CB Richard Ellis’s May survey, when London was passed by inner central Tokyo, the broker estimates that the West End has held the title of the world’s most expensive office site since 2001.

West End rents have been pushed higher by the Mayfair and St. James’s neighborhoods, home to Europe’s largest concentration of hedge funds. The cost of leasing space in the two locations may rise as the municipality lifts business property taxes by at least 70 percent over the next five years, CB Richard Ellis researcher Gary Martin said.

Tokyo Rates

“None of the other main global office markets will have such an uplift,” said the London-based analyst.

Inner central Tokyo came in second in the CB Richard Ellis survey, while outer central Tokyo came in third. Central Hong Kong was fourth and Moscow was fifth. A year ago the order was the West End, Moscow, central Hong Kong, inner central Tokyo and Mumbai.

London and many Asian markets are showing signs of economic stability, Torto said. Most of the rent declines in those markets have probably already happened, he said.

“I would think that a year from now those markets will have sobered up,” he said.

New York City’s Midtown Manhattan came in 24th in the CB Richard Ellis survey, down from 15th last year. It remains the most expensive U.S. office market.

In the Americas, Sao Paulo and Rio de Janeiro displaced Midtown as the most expensive markets for offices. Rio rose to 12th in the semi-annual survey from 37th a year ago, while Sao Paulo rose to 16th from 26th.

‘Changing World’

The rise in the two Brazilian cities is “part of the changing world,” with the country’s oil and sugar cane ethanol industries helping to push demand, Torto said. New York’s decline paralleled a drop in financial services employment, he said.

Offices in New York averaged $68.93 a square foot at the end of September, compared with $87.47 in Rio and $81.81 in Sao Paulo, South America’s biggest city.

Rio office costs increased 12.1 percent, the second biggest increase in the survey. Sao Paulo has about 115 million square feet of offices, about the size of Chicago’s office market, according to Torto.

Offices in Rio will likely get more expensive as the country begins preparing for the 2016 Olympic Games, the report said.

“With the emerging economies, their office markets are much more volatile, and they have a much more limited supply of grade-A office space,” said Dan Fasulo, managing director of Real Capital Analytics Inc., a New York-based firm that tracks commercial property sales. “So when there’s an economic boom, there’s always a violent increase in occupancy costs due to constrained supply.”

Tishman Projects

Tishman Speyer Properties LP, the global real estate company whose office buildings include Manhattan’s Rockefeller Center and the MetLife Building, entered the Brazil market 13 years ago and has built or is building 21 office projects there. Eighteen are in Sao Paulo and three are in Rio, said Katherine Farley, a senior managing director who oversees the New York firm’s Brazilian operations.

The company has had success providing “international- quality” Class A offices in Brazilian cities where even the highest-quality buildings are mostly not air conditioned, she said.

“Because historically there has been no commercial lending, most of the projects that are built are built with equity,” she said. “What you saw happening in Brazil, they were one of the last economies hit by the global liquidity crisis, and one of the first to come back. We’re back to the levels before the crisis; you see a kind of V-shaped reaction.”

Brazil may grow 5 percent in 2010 after an expected 0.2 percent growth this year, according to the median forecast in a Nov. 27 central bank survey of about 100 economists.

Rio was among 41 cities in the survey where costs rose. The biggest increase was in Aberdeen, Scotland, where office costs jumped 12.3 percent. Sao Paulo office costs were little changed.

CB Richard Ellis defines occupancy costs as a rental charges including taxes and service fees.

To contact the reporters on this story: David M. Levitt in New York at dlevitt@bloomberg.net; Simon Packard in London at packard@bloomberg.net.

Last Updated: December 1, 2009 17:07 EST

Investimento chinês exclui o Brasil

sexta-feira, 27 de novembro de 2009, 09:17 | Online Investimento chinês exclui o Brasil

 PAULA PULITTI – Agencia Estado

 

SÃO PAULO – A China tem surpreendido o mundo com o salto de seus investimentos produtivos no exterior. Mas o Brasil parece fora desse movimento. A relação bilateral tem de fato se intensificado, só que, basicamente, no âmbito comercial. Enquanto os chineses absorvem cerca de 10% das exportações brasileiras, puxadas por soja e minério de ferro, o investimento direto em solo nacional é exíguo, apesar dos esforços de aproximação.

Hoje, chega ao Brasil uma missão de 350 empresas chinesas de diversos setores, das quais 125 são potenciais investidoras tanto no setor produtivo quanto no financeiro, segundo a Apex, a agência oficial de promoção de exportações e investimentos. Entre elas estão a Beiqi Foton Motor (automóveis), Datang Capital (tecnologia da informação), Sinochem Group (petróleo) e o Agricultural Bank of China e Bank of Communications of Shanghai.

Segundo dados do Ministério do Desenvolvimento, Indústria e Comércio Exterior, as vendas para a Ásia (leia-se China) aumentaram 4,2% de janeiro a setembro deste ano, colocando a região na primeira posição de mercado comprador, superando a União Europeia (UE). Em 2008, a China comprou US$ 16,4 bilhões do Brasil.

Já em investimento direto, os últimos dados disponíveis do Banco Central mostram que a posição de estoque da China no Brasil não passava de US$ 238,7 milhões até abril, segundo levantamento do economista Luís Afonso Lima, presidente da Sociedade Brasileira de Estudos de Empresas Transnacionais e da Globalização Econômica.

O valor real, na verdade, é uma incógnita, já que muitos dos recursos chineses que ingressam no Brasil podem vir por meio de terceiros países. Mas, mesmo que seja o dobro do que registra o BC, o valor é “irrisório”, para o secretário executivo do Conselho Empresarial Brasil-China, Rodrigo Maciel. “Apesar de ser relativamente nova no cenário, a China já tem perfil de investidor mundial.”

Em 2008, a China respondeu por 2,8% dos fluxos globais de investimentos diretos produtivos, que corresponde a US$ 52 bilhões, mais que o dobro do de 2007, segundo a Conferência das Nações Unidas sobre Comércio e Desenvolvimento (Unctad). O Brasil recebeu menos de US$ 38 milhões. Segundo Lima, o IED chinês ainda se concentra na Coreia do Sul, no Japão e Vietnã. Fora da Ásia, o foco é a África. “A China quer matérias primas para sustentar seu crescimento.”

“O dado exato é difícil de obter”, concorda Márcia Nejaim, gerente-geral de Investimentos da Apex. “O que sabemos é que os investimentos no Brasil são pequenos, quando se compara com outros países.” O presidente Luiz Inácio Lula da Silva visitou a China mais de uma vez, assim como o presidente Hu Jintao veio ao Brasil. Mas quase nada se reverteu em investimento produtivo.

Uma exceção foi a Petrobras, que em outubro obteve um empréstimo de US$ 10 bilhões do China Development Bank. Também fez acordo com a Sinopec, gigante chinesa do petróleo, para cooperação nas áreas de exploração, refino, petroquímica e suprimento de bens e serviços para a indústria do petróleo. O empresário Eike Batista também está prestes a acertar sociedade entre a Wuhan Iron & Steel e a MMX Mineração e Metálicos. As informações são do jornal O Estado de S. Paulo.

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