“What’s your greatest health-related fear, after cancer?” asks our tech-and-biotech guru Stephen Petranek.
“If you’re like the vast majority of Americans, and if you are like me, it’s blindness. Poll after poll over the years show that people across racial and ethnic and cultural divides agree that losing the ability to see is one of the worst things that can happen.”
The tragedy is amplified when it happens to a child. “It happens a lot more often than you might think,” says Stephen — “frequently from inherited genes that are mutated.”
“Repairing genetic disorders has been a frustrating goal of medicine for many years now,” Stephen explains by way of background.
But he thinks he’s identified the scientist most likely to be first to get FDA approval for a genetic modification of a disease.
For years, this researcher has been working with children suffering from what’s called Leber disease. The efforts have paid off. “One child who had previously needed a cane to navigate was suddenly able to play sports with other kids,” says Stephen. “Others that couldn’t make out much of anything with their eyes could read an eye chart.”
The treatment can work on more than just Leber disease. “There are a number of inherited eye diseases caused by this disorder, none of which is treatable by drugs.”
Side effects? None that is serious. “This may be partly because the retina is really part of the brain and lodged behind the so-called blood-brain barrier,” Stephen goes on. “Thus, the body’s immune system is unlikely to attack it.
“I like to invest in companies with promising drugs that have successfully completed Phase 2 studies and are about to enter, or have entered, Phase 3 studies,” Stephen adds.
That’s exactly where this breakthrough vision treatment stands right now. The company behind it also has other drugs in the pipeline — including a promising treatment for hemophilia, the inability for the blood to clot. (That too is a genetic disorder.)
The firm went public last fall, at a time the biotech market as a whole began moving sideways. Stephen recommended it to his readers only three weeks ago. It’s already up 29.5%.
If anything, many of Stephen’s picks have run up too far too fast… at least for readers who didn’t pull the trigger right away. Looking over his recommendations the last six months, we see gains of…
- 85% in less than 6 months
- 100% in 5 months
- 22% in 4 months
- And, as mentioned, 29% in three weeks.
There’s one loser within the last six months, but it’s down only 10%.
One of Stephen’s picks is a little older. It goes back about nine months. But it’s attractively priced for the moment. We directed your attention to it last week — we called it the machine that might save your life… after it makes you rich.
If you missed it then, now’s the time to move: This presentation goes offline tonight at midnight.
The major U.S. stock indexes have begun to recover some of Friday’s steep losses. At last check, the Dow is a point away from 17,950. The S&P 500 has added a quarter-percent, to 2,077.
The buzz on the Street is about the rollout of the Apple’s watch today (yawn)… and about General Motors’ plan to buy back $5 billion in shares.
Hmmm… Last year, auto sales returned to the giddy levels of 2006. GM seems to be saying it’s a better use of cash to return it to the shareholders than to invest in growing the business, no?
“It doesn’t feel like stocks are at new all-time highs in 2015,” says Jonas Elmerraji of our trading desk.
Six years ago today, the S&P 500 bottomed at the infamous 666 level and began its epic climb.
Only it hasn’t felt very epic lately. “Part of that,” says Jonas, “is because the S&P has only moved 0.6% higher this year.
“So Mr. Market may be making new highs, but that’s only because the helicopter dropped him off right by the summit of Mount Everest at the beginning of the year, and then he took one more step higher.”
Indeed, the S&P is only 3% higher now than it was six months ago.
“Another reason that this market doesn’t feel like it’s plowing through new all-time highs,” says Jonas, “is that many of the individual stocks aren’t. Right now, only 40% of S&P 500 components are within 5% of their 52-week highs.
“That’s a big deal for one simple reason — how investors feel about stocks has everything to do with what happens to stock prices.”
No, that’s not a sign of an imminent crash, or even a correction. But it’s something Jonas continues to keep an eye on. For now, the S&P sits in the middle of its upward channel going back, well, six years.
“Hillary Clinton has a big problem,” says our Byron King — teasing out the investment implications of the fact she carried out official duties as secretary of state for four years via a private email account on a server at her home.
Security? Confidentiality?
Byron knows a thing or two about that. He was on staff at Chief of Naval Operations at the Pentagon. “I saw all kinds of things, every hour of every day. Confidential. Secret. Top-secret. It was part of my job. And another part of my job was to keep that information secure.”
Indeed, he says it’s the job of everyone who comes into contact with that sort of information.
“State Department policy requires that normal, day-to-day operations be conducted only on authorized information systems, which include numerous layers of security control. It only makes sense, as we see with all manner of cyberintrusions and attacks against major firms, from Target to Citibank. The bottom line is that unauthorized systems increase risk of data loss, ‘phishing,’ spoofing, hacking, etc., regarding email accounts.
“And Hillary didn’t know this? Nobody ever counseled her?
“Looking ahead, I expect that post-Hillary, every department of the U.S. government with any classified material within the email traffic will perform a major scrub of every system, top to bottom. I expect every government employee, everywhere, to receive an email — on the government account — with a list of questions about email usage, along with new, super-tight compliance policies. Lock that barn door, good and hard!”
No doubt it will benefit some of the cybersecurity plays Byron has laid out in his Military-Tech Alert. For access, look here.
Stupid government tricks, Part 1: Greece is looking for “students, housekeepers and even tourists” to act as undercover tax snitches.
Greece has submitted “reform” proposals to its European masters to assure an extension of the government’s bailout loans.
Reform No. 3 describes these “nonprofessional inspectors.” They would be — this is the proposal’s own wording — “hired on a strictly short-term, casual basis (no longer than two months, and without any prospect of being rehired) to pose, after some basic training, as customers, on behalf of the tax authorities, while ‘wired’ for sound and video.”
Aside from the fact tax evasion and an anti-snitching mentality are time-honored traditions in Greece, what could possibly go wrong?
Stupid government tricks, Part 2: This one is more ominous.
“Venezuela is due to begin installing about 20,000 fingerprint scanners at supermarkets across the country,” reports the BBC, “as part of its introduction of rationing.”
Inflation in Venezuela is officially running 64%. Unofficially, Johns Hopkins professor Steve Hanke says it’s more like 157%.
Hence, price controls. Hence, shortages. In January, the hashtag #AnaquelesVaciosEnVenezuela (“Empty Shelves in Venezuela”) took off on Twitter.
Just another day in a socialist paradise…
Now comes word President Nicolas Maduro has “persuaded” seven major retailers to install the fingerprint scanners, the better to stop “hoarding” and “panic buying.”
The fact the owners of several grocery and drug chains were arrested last month might have had something to do with their decision to go along with the president’s wishes. Their “crime”? Failing to keep enough cash register lines open.
As if more lines would somehow alter the perception of shortages. Oy…
“I always perk up when I hear the words ‘conspiracy theorists,'” reads the first item in a packed mailbag, “because it usually means someone is getting defensive, usually applied to vaccinations, our military spreading freedom and defending us from terrorists and banking.”
In this case, the reader is referring to Chris Mayer’s assurance here last week that the FDIC will have no trouble covering insured deposits.
“It’s just simple math,” the reader counters. “The FDIC has $33 billion as of Dec. 31, 2012, to insure total deposits of over $9 trillion. Meanwhile, total outstanding derivatives for the top 25 holding companies are almost $300 trillion. To argue that the FDIC has plenty of money is just bad math. Of course, in an Orwellian world, doing math may be a conspiracy theory now.”
The 5: “Let me make it even plainer,” Chris replies: “The FDIC has access to the U.S. Treasury. Period. And the U.S. Treasury, as every 5 reader should know by now, CAN CREATE MONEY OUT OF THIN AIR!
[Heh, Chris is rarely given to all-caps. So it’s amusing to see it from him…]
“Ergo, the FDIC has an infinite supply of money. I don’t care if the FDIC has $1 as of Dec. 31 to insure total deposits of $986 quadrillion deposits. It can cover it.”
“Does the FDIC add all bank accounts today and pay $250,000 per bank?
“Back when I had a lot of cash in my bank (several, actually), one banker told me that the FDIC would add ALL bank accounts in the same Social Security number together.
“I have concluded that if I ever won the lottery, cash option, I would be best off buying my own bank to keep it in. That banker has been retired almost as many years as I have, and in my current bank (branch), I never see a banker.”
The 5: “It is per depositor,” says Chris. He adds: “Yes, buy the bank. The old saw is that the best way to rob a bank is to own one.”
“For the reader who accuses you of bias,” writes a Reserve member weighing in our Obamacare thread last week, “here are some unbiased numbers.
“According to eHealth and The Daily Caller, health care premiums rose 37% for the eight-year period 2005-13. During the one-year period 2013-14, premiums rose 39%. Anyone see a gross upward distortion in health insurance premiums?
“My wife is an MD (internal medicine), and I am an RN. Both of us are 52 and spent significant money and time on education, certifications, licensing and other fees. We can assure you and your readers we are NOT seeing wage increases from the health care cost increases.
“Insurance, pharma and device companies aided by political quid pro quo business as usual are seeing massive financial returns. In the end, the cheerleaders and lumpen will remain the real losers. Like economics or filling out tax returns, the citizens don’t know half of it, and of that half, they only understand 10%. (We could do a huge expose with a new paragraph per day for years.)
“Keep hitting the truth no matter whom it hurts.
“P.S. The geriatrics who have enjoyed massive wealth redistribution from SS and Medicare will be very unhappy when real health care rationing (‘You are not getting this treatment’ versus the current ‘We can get you into the schedule in two months’) emerges.”
“Despite ‘good’ economic news and better employment figures,” a reader responds to Friday’s episode, “the Fed has a real dilemma.
“With the dollar through the roof, and rising, raising interest rates would only strengthen the dollar, further throwing our export businesses nearly out of business and potentially tipping the economy back into recession.
“Having just got back from Malaysia and Southeast Asia, I was buying stuff I could always get cheaper at home… but the purchase price for the goods stores sold had not caught up yet to the new dollar reality. I think I was getting a good 20-30% discount. Nice for me, but not good for U.S. industries needing to compete on the foreign markets.
“When the Fed raises rates, watch for the euro to sink well below 1-to-1, if it hasn’t done so already.”
The 5: Here’s an even bigger dilemma for the Fed: It can’t raise rates, because that will raise Uncle Sam’s interest expense on an $18 trillion national debt. But it has to raise rates, because pension funds are getting a miserable return under zero interest rate policy.
Something’s gotta give. Which will it be?
Best regards,
Dave Gonigam
The 5 Min. Forecast
P.S. Final reminder: Discounted access to our premium tech advisory, Breakthrough Technology Alert, comes off the table tonight at midnight. Access at this link.
