Why You Shouldn't Invest in American Stocks

Before you get any ideas, let it be known that we love the NCAA tournament, Oreo cookies, and Saving Private Ryan. But when flipping through an issue of Fortune, an astoundingly hammy ad made me (Brian) stop cold.

In big, bold letters, it read: "When you invest in America, you're really just investing in yourself."

Cue violin
The ad is for the SPDR Dow Jones Industrial Average ETF (NYSE: DIA  ) , and we have nothing against that exchange-traded fund per se -- it has low expenses and does what it says it will, tracking the 30 stocks in the Dow.

The ad, though, sells an investment in a way that undermines the investor -- by pandering to patriotic emotions. Here's more of the text:

There's an unspoken agreement in America that each generation should leave this country in better shape than they found it. Maybe that's why the U.S. economy has been growing since the Industrial Revolution. Everyone tries to do their part. If you believe this covenant still exists today, consider the SPDR Dow Jones Industrial Average ETF. [emphasis ours]

A touch melodramatic, eh?

We'll cut straight to why you shouldn't invest in American stocks: Because you are patriotic and sentimental about America. Kudos if you are those things -- just don't invest for those reasons.

Losing money is not patriotic
Consider, for example, Ford (NYSE: F  ) and Toyota (NYSE: TM  ) . Are you more patriotic if you owned Ford over the past decade? No, you're just poorer (though both have lost money for investors, given how difficult it is to compete in the cyclical auto industry).

And while you might have thought it would help Ford out to purchase its stock when it was imploding in 2009, the fact is, when you buy a stock in the stock market, that money does not go to the company. Instead, it goes to a person who bought the stock from some other person.

So rather than bail out Ford, you were actually bailing out the person who bought Ford before you. That said, Ford has turned out to be a great investment since 2009, thanks to its return to profitability under Alan Mulally -- for reasons that have nothing to do with patriotism.

The point is, companies only raise money during offerings. If you're buying or selling stock on the open market during a regular trading day, it generally will have no effect on the operations of the underlying company.

And even when it comes to offerings, you shouldn't buy shares of a company because you think it needs help, or because it might be patriotic to do so -- as the marketing surrounding the inevitable GM IPO will almost certainly imply. Most companies, when push comes to shove, won't return that thoughtfulness to their shareholders.

There's a larger lesson here
Patriotism, however, is only one of the ways that you might get suckered into making a poor investment decision. Others include buying into a rising stock for fear of missing out on gains (as so many did during the tech bubble), or selling a stock that's dropping solely because you're afraid it might go lower. Or as The Wall Street Journal explained recently:

Everyone develops attachments that can be irrational sometimes, whether to a house, a car, even a person. People can also get overly attached to a particular investment, believing it will reach -- or return to -- a certain price. Or they may place too much importance on one piece of information when making an investment decision. These are examples of anchoring bias, which causes the investor to hold on to the asset for longer than they should.

So there's a large lesson here, and it's this: An emotional investment is bad investment.

Don't believe us? Thankfully, there's now an entire field -- behavioral finance -- devoted to studying the ways in which our investing hearts get the best of our investing minds (actually most emotion happens in the brain as well, but stay with us).

Rather than rehash it all, we'll quote a Stanford study sums it up unequivocally: "Emotions can get in the way of making prudent financial decisions." We also recommend you read the fabulous Jason Zweig book, Your Money & Your Brain.

But back to America
Frankly, we think it's irresponsible for an ad agency to pull your patriotic heartstrings to make you want to buy an investment product that tracks the Dow 30. Not only is it intellectually strange -- assuming your dollars do go to support the business you buy, wouldn't it be more patriotic to buy shares of a collection of American small business, rather than 30 massive multinationals? -- it's just flat-out inane. A sense of civic duty is no reason to buy a stock or ETF, period.

Yet none other than investing icon Warren Buffett went to the exact same well when, during the peak of the financial crisis, he published his now-famous New York Times op/ed titled "Buy American. I Am."

To be fair, editorial page editors often pick the titles of editorial page editorials, so Buffett may not have been responsible for that slightly over-the-top headline (though who are we to criticize for an over-the-top headline?). Furthermore, the headline isn't even consistent with what Buffett's actually been buying at his investment vehicle, Berkshire Hathaway.

The holding company now owns stakes in China's BYD, the U.K.'s GlaxoSmithKline (NYSE: GSK  ) , Switzerland's Nestle, and France's -- yes, France's -- Sanofi-Aventis (NYSE: SNY  ) . What's more, Berkshire owns sizable stakes in ostensibly American companies such as Coca-Cola (NYSE: KO  ) and Wal-Mart (NYSE: WMT  ) that have investment and growth abroad -- key parts of their business strategies going forward.

No, Buffett is not a hypocrite
This is all very smart -- both for the companies and for Buffett. Emerging markets are growing faster than the U.S. and have less ominous debt profiles. The dollar is weakening relative to those currencies. It makes sense to have a healthy dose of foreign exposure today! In fact, we'll go so far as to predict that if you buy foreign stocks, you'll earn better investment returns and end up paying more in capital gains taxes -- money that will actually go to prop up America (if that's the sort of thing you're looking to do).

All told, the takeaway from Buffett's editorial was not "Buy American," but rather found farther down in the copy: "A simple rule dictates my buying: Be fearful when others are greedy, and be greedy when others are fearful. And most certainly, fear is now widespread, gripping even seasoned investors." Sometimes, that means Buy American, and other times it means Buy Abroad. But all the time, it means that you should make smart, unemotional decisions with your investment capital.

If you'd like some smart, unemotional investing ideas, enter your email in the box below to get "Motley Fool Top Picks & Perspectives 2011," a new free report with stock recommendations and portfolio guidance for the year ahead. We'll also tell you more about Million Dollar Portfolio, our real-money portfolio service that buys the best of our investing ideas, opening for the last time this year. To get started, just enter your email in the box below.

Berkshire Hathaway, Coca-Cola, and Wal-Mart are Inside Value picks. Berkshire and Ford are Stock Advisor recommendations. GlaxoSmithKline is a Global Gains selection. Coca-Cola is an Income Investor recommendation. The Fool owns shares of and has written covered calls on GlaxoSmithKline. The Fool owns shares of Berkshire Hathaway, Coca-Cola, and Wal-Mart.

Tim Hanson owns shares of Wal-Mart and Berkshire. Brian Richards doesn't own any of the companies mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


Read/Post Comments (29) | Recommend This Article (85)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On November 05, 2010, at 3:33 PM, TMFtheEdge wrote:

    Buy American, I am -- this was actually about Buffett's personal portfolio.

  • Report this Comment On November 05, 2010, at 3:36 PM, madmilker wrote:

    Why every American should....

    on Wal*Mart's China web page!

    "Wal-Mart China persists in local procurement which provides more job opportunities, supports local manufacture industry and promotes local economy. So far, 95% of merchandising sold at Wal-Mart China store are local products by which Wal-Mart has established business relations with nearly 20,000 suppliers. At Wal-Mart, we treat suppliers as partners and would like to develop with them. In 2008 Wal-Mart won the Supplier Satisfaction published by Business Information of Shanghai for five consecutive years."

    5% foreign in China...

    That doesn't support American exports and American jobs.

    Remember what Lance Winslow wrote in that article "The Flow of Trade in a Global Economy"....

    "Now let us look at Wal-Mart again; you buy a product there, 6% goes to the employees, 10-18% is profit to the company, 25% goes to other costs and 50% goes to re-stock or the cost of goods sold. Of the 50% about 20-25% goes to China, a guess, but you get the point. Now then, how long will it take at 433 Billion dollars at year for China to have all of our money, leaving no money flow for us to circulate? At a 17 Trillion dollar economy less than 40-years minus the 1/6 they buy from us. Some say that if we keep putting money into our economy, it would take forever, but if we do not then eventually all the money flow will go. If China buys our debt then eventually they own us, no need to worry about a war, they are buying America, due in part to our own mismanaged trade, so whose fault is that? Not necessarily China, as they are doing what's in the best interests, and we should make sure that trade is not only free, but fair too."

    Think for a moment about George Washington....yes the man that is on the US dollar bill....How do you think George feels being sent overseas in return for all that foreign so-call cheap items and being left in a foreign bank because the American worker doesn't make anything for the foreigners to buy. Cheap items didn't make this great union of 50 states the greatest place on the face of this Earth.....the American worker (union and non-union) did.

    You can't have a strong country without having a strong currency and you can't have a strong currency unless you keep it floating around within your 50 states. This is why the store with the star in the name puts 95% China made items in their stores in China....to keep their "yuan" in their country helping the nice people there. And with only 5% left for all the other 182 country's that make stuff including the United States of America....that doesn't produce very many jobs outside of China.

    Being an old person myself and knowing how it was back in the 40's, 50's and 60's in this union of 50 states....I look at George each time I pull him out of my billfold and make a promise to send him out for items made in America so after floating around helping each hand he touches just maybe one day he will shake mine again.

    Fifteen cargo ships pollute as much as 760 million automobiles.

    $9 billion a year in hidden taxes to all American taxpayers to clean fish from ballast tanks of ships...

    think about all those facts the next time you pull that George out of your pocket....

    Retail makes NOTHING...

    Governments only make MORE DEBT...

    It's time for less of those two and for America to get back to what it does best....MAKE STUFF..

    cause George Washington on that dollar can't help anyone in the United States of America if he is being held in a foreign hand.

    Made In America is the only way out of this mess cause foreign made put US here.

  • Report this Comment On November 05, 2010, at 5:24 PM, puckjohnl wrote:

    This is the second time I'm writing to caution you about your headline lead-ins. Yeah, I get the intent and reasoning behind the full article, but what if one of your less-than-fully informed readers went no further than your headline? What if he were simply in a hurry or just roughly perusing the "Guidance of the Day? You said it yourself in the article (albeit way, way down!): "(though who are we to criticize for an over-the-top headline?). " You don't need the flash and trash Enquirer crap. Remember you bear some responsibility to your readers to educate and inform. And that means starting (especially starting) from the top! In this day and age of attention spans like doorknobs, your headline might be all the chance you get. Cut the "cleverness."

  • Report this Comment On November 05, 2010, at 5:27 PM, onenewsman wrote:

    Dear Tim and Brian,

    I agree with your overall view that some how you are not patriotic if you don't purchase American goods. Gives the same quality and close in cost I do try to choose Made in America, which is in itself not always easy to discern. I disagree with you about buying Ford stock. When you make that play sure the money goes to the other person, not the company( unless it's an IPO), but that does effect the price of the stock which the underlying company A: Likely has a postion in,which helps their bottom line, and B: when folks see a company's stock holding or moving up it gives the consumer a degree of confidence in the brand. What is really unpatriotic is when an American company knowingly builds and markets a product they could have constructed better and have more lasting value. That is greed and a myopic mind set that was fostered in Detroit for many years. Both Ford and GM did this. I owned a Chevy Vega, it was an engineering insult ! The consumer world is shrinking and we are offered products from the far corners of the globe. We can all thank Ford for finding the wisdom and talent to lead the auto industry out of the quicksand they had driven them selves into.

    I do own Ford shares at the present time.

  • Report this Comment On November 05, 2010, at 5:32 PM, money4eds wrote:

    Investing is about choice. All advice is just that, think before you spend your money on an investment. Spend is the right word because you may not get back all the money.

    Buy American and do the opposite of the Motley Fool are nothing more than advice. Value is where you find it and I appreciate the diversity.

  • Report this Comment On November 05, 2010, at 6:40 PM, Borbality wrote:

    Didn't Mr. Vanguard Bogle just say every single foreign investment was a bubble right now? A few days ago he said (according to this website) to completely avoid foreign stocks!

  • Report this Comment On November 05, 2010, at 6:42 PM, Borbality wrote:

    RichieRich77: I feel for you, but that easily could have been GM and your buddy could have lost the farm, if his only reasoning was that an American ICON couldn't lose.

    Congrats on making a lot on F though. It sucks to think how much we could have made, but the important thing is that we made something!

  • Report this Comment On November 05, 2010, at 7:30 PM, koolkrissy wrote:

    I agree with the person who cautioned about the "clever" headlines that are in many instances, very misleading.......especially to newbees who do not fully understand the Motley Fool ideology.

    I appreciate MF advisor's personal experiences and the relating of certain principles to experiences as a way of getting the point across to some of us who are more thick headed than others; however, please consider a piece of advice I was given by my most admired boss in the legal field. He said, "When writing or expressing anything to anyone, KISS it! [Keep It Simple Stupid!] SAY WHAT YOU MEAN!

  • Report this Comment On November 05, 2010, at 7:37 PM, Glycomix wrote:

    Ford vs. Toyota? This is a poor example because Ford has been so much more successful than Toyota this year! Of course, some ```of the difference may be due to the efficiency of Ford's reorganization and Toyota's recalls.

    I have questions on where to find useful and accurate financial data on companies in European, South-American, and Asia, and how to buy stocks, options, and forex (for their money) so we can access these markets.

    Ford has made 33% for investors in the past 6 weeks. It's gone from a opening price of $12.19 on Oct 1 to a closing price of $16.25 today, Nov 5. That's an increase of $4.06, a 33.3% in 36 days (an annualized increase of 337.7%.)

    In the same period Toyota opened at $71.62 on Oct 1 and closed at $72.65 on Nov 5. Toyota had an increase of $0.97 in 36 days which is a 1.35% increase in 36 days ( an annualized 13.7% increase.)

    Which would you rather have Ford's 33.3% increase in stock price or Toyota's 1.35% increase? You're proposing Toyota?

    Ford's current PE is 10.08, with a forward PE of 8.10. Toyota's PE is 19.17 with a forward PE of 13.14. Which would you choose? Ford's free-cash-flow is 6.54 while Toyota's is not as good, but a respectable 8.15.

    In quality, the edge seems to go to Ford because of Toyota's numerous recalls this year and because they give a 5 year 50,000 mile warranty while Toyota's is only 3 years and 30,00 miles. Consumer's guide rated the Ford and Toyota hybrid equally high. However, the Ford has more space and cooler gadgets such as a child-cam for backing up and a warning when someone is coming from the side.

    I'm considering buying a Ford car and definitely plan to get the stock. I'll wait until next year before I look at Toyota. Perhaps their performance will have improved by then.

    Toyota has a 1.6/% dividend, but I'd rather have the improvement in stock-price.

    There's nothing wrong with any first-world stock market, like the Swiss, German, British, Japanese, or Chinese Stock Markets. However, Is their transparency as good as is required by the 1934 and 1935 US securities laws? What is the financial statements equivalent to those embedded in the 10K and 10Q?

    Where do you find financial data on individual companies in different stock markets such as the following: the Japanese market, Hong Kong Hang Seng, Indian, British, Brazilian, Australian, German, Swiss, Japanese and Chinese (Shanghai and Hong Kong)?

    Where would you find reliable data on these markets? Obviously, some data is available from Motley Fool. However, I'd like confirmatory data and other sources. Which sources do you use at Motley Fool? Do you recommend any specific services? Would Value-Line be useful for overseas investing?

  • Report this Comment On November 06, 2010, at 12:30 AM, BioBat wrote:

    Yet another sensational headline that isn't supported by the article written.

    And yes, let's consider Ford and Toyota - probably the poorest example you could come up with. I mean seriously, corporate turnaround vs. corporate head in the sand and we're supposed to not go with the American company? Seriously? Seriously? You couldn't dig up a better example of US vs. foreign companies? Hey why not compare Exxon and BP while we're at it? Oh wait, nevermind.

    Anyway, back to F vs. TM. Had you bought $5K Ford in a patriotic binge back in November 2008, you'd now be looking at a 10-fold return on your investment with over $50K. Had you bought $5K in Toyota common stock at the same time, you'd be right about even.

    Heck, if you bought $5K in Ford back in January when it was trading around $10 a share, you've made $3K in that time. The same $5K in Toyota would now be worth between $3.5 and 5K.

    So the lesson/headline shouldn't don't invest in American stocks because frankly, that's a stupid lesson, it should be don't BLINDLY invest in American stocks but that goes just as well for foreign stocks as well.

  • Report this Comment On November 06, 2010, at 1:16 AM, shoot2score wrote:

    I'm curious if anyone proofs these articles for grammar? Please advise. Thanks.

  • Report this Comment On November 06, 2010, at 1:18 AM, shoot2score wrote:

    What about the irony of my grammatically incorrect query? I'm laughing at myself for that.

  • Report this Comment On November 06, 2010, at 11:37 AM, TMFBrich wrote:

    @shoot2sccore: Yes. What is grammatically incorrect?

    Brian

  • Report this Comment On November 06, 2010, at 11:40 AM, TMFBrich wrote:

    @BioBat: "Yet another sensational headline that isn't supported by the article written."

    How is the headline not supported by the article?

    "We'll cut straight to why you shouldn't invest in American stocks: Because you are patriotic and sentimental about America. Kudos if you are those things -- just don't invest for those reasons."

    Brian

  • Report this Comment On November 06, 2010, at 12:02 PM, kayakmastr wrote:

    I guess after a long day's work and a few drinks too many just like to carp. The heading is clear and the artcle provides that answer. You shouldn't invest in American stocks just because its seems to be the patriotic thing to do to support American companies. Invest in Ford because it's an American icon as suggested by one, GM always seemed like a bigger American icon. Was the saying, what's good for GM is good for the country, or was that what's good for Ford? At auto bailout time, both Ford and GM were in deep dodo, and some thought GM would fare better because they were taking free $$$ from us through the Government. Only time would prove otherwise. So the wise investment at the time might have been 10K$ in F and 10K$ in GM rather than 2 or 20 in F. Another said, do the opposite of what the Fools recommned. OK, how about some opposite examples to match up with some of my Fool winners AKOA 53% in 9 mo, CBI 40% in 12 mo, ESGR 30% in 9 mo, FMX 27% in 8 mo, NVS 29% in 5 mo, PVD 53% in 8 mo, RDY 44% in 10 mo, VEMTF 44% in 6 mo. The list can go on. Get the idea.

  • Report this Comment On November 06, 2010, at 12:25 PM, snapperreef wrote:

    Thanks for an informative article. It is good for you to state and restate the fact that buying shares in a company other than new issues or IPOs only gives money to someone who thinks the company is not as good an investment as it once was. New investors rarely know this .

    I also agree the title might have been "...Shouldn't Invest in Am St--Because of Emotions or Because of Patriotic Admonitions "

  • Report this Comment On November 06, 2010, at 7:07 PM, northshoregirl wrote:

    Um, I'm no expert, but I think this article misses a very basic alternative. Investing in US companies with strong sales and potential in other markets.

    The top two performers in my real-life portfolio are CMI and YUM. I think this foreign exposure is a big factor in their current success.

    But I'm not afraid to invest in foreign opportunities.

    They need us, we need them.

    Does this mean I'm an old hippie???

  • Report this Comment On November 06, 2010, at 8:55 PM, JustMee01 wrote:

    I get your point. But, it's too simplistic.

    "So rather than bail out Ford, you were actually bailing out the person who bought Ford before you."

    No, I wasn't. I was making a once in a lifetime investment on a cyclical that was trading for pocket change. I didn't bail a former Ford investor. I robbed the panic-striken fool blind.

    I was buying stock in a company that was the sole survivor in Detroit. There was no political reality that would have allowed Ford to go under. Beyond that, if one took the time to actually gather some information at that time, one would have found that i's a company that was already in the process of the restructuring that GM and Chrylser were just beginning. It was also a company that had reengineered its whole fleet, with a large amount of fresh product in the pipeline. Mulally artfully played every card in his hand and hacked the balance sheet into shape.

    The result. Huge savings in fixed costs to go with the already present savings in SG&A.

    But you know this, since you yourself state:

    "...Ford has turned out to be a great investment since 2009, thanks to its return to profitability under Alan Mulally -- for reasons that have nothing to with patriotism."

    Americans didn't rally to Ford's defense by buying their cars??? Just look at their share gains. I do think that has something to do with people choosing to support US businesses, even if you choose to laugh at the notion.

    And finally, one more over-simplification:

    "The point is, companies only raise money during offerings. If you're buying or selling stock on the open market during a regular trading day, it generally will have no effect on the operations of the underlying company."

    That word "generally" is an important one in that sentence that some people won't necessarilly recognize the improtance of. Is your statement true of a bank that has pressing capital needs? Is it true of stock in a company that regularly raises capital through equity? Annaly for instance? Or a small company that couldn't get access to the credit markets during the crisis? What about Ford? That's your actual example...

    If you seriosly contend that Ford's stock price resurgence wasn't critical to their survival, then you really didn't follow their recovery that closely. A timely equity raise http://www.ford.com/about-ford/news-announcements/press-rele... coordinated with a large convertible debt issuance http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a... raised capital at a time that was very important. That wouldn't have been possible at lower share prices. It's stock price was in fact a VERY important factor in Ford's survival. That equity and convertible raise provided cash to support the company just after the tender that took out a huge chunk of unsecured debt, producing the cost reductions that have now made Ford the most profitable automaker. It's share price recovery was a very critical element in the equation.

    I know that the purpose of your story was pretty simple. But, I'm just a little people intimating that I'm an idiot for investing in Ford. Ford was a much simpler call than people made it, and the idiots were in fact, the people that couldn't see past the doomsday forecasts, not me. And I have a big of money to prove it...

  • Report this Comment On November 07, 2010, at 9:22 AM, daveandrae wrote:

    I am becoming very skeptical of this site. For just about a thirteen months ago, your penned the headline "is Harley doomed?"

    The stock is up 33.70% since then. I know, because I own it. All of you should go back and read the responses. Not only are they adamantly passionate in their hatred for the motor company, they were 100% precisely WRONG!

    This is yet another reason why 3% of the population controls a whopping 70% of the wealth in this country. Everyone loves a sale until there's one on wall street.

    The headlines you choose for your stories are poor, at best, and getting worse. I am barely getting past the first paragraph before I lose interest.

    Thomas Edmonds

  • Report this Comment On November 07, 2010, at 3:22 PM, BillyTG wrote:

    "Investing in America" is an oxymoron. If you don't understand by now how rigged the game is, and how artificially inflated the market is, then I guess you deserve to go down with the ship. Withdraw from the markets now, buy some physical silver, and stock up on emergency supplies if you have any sense at all. Mark my words, and check back here in one year.

  • Report this Comment On November 07, 2010, at 7:12 PM, rd80 wrote:

    The most ironic thing about an ad encouraging people to buy a DJIA etf based on patriotism is that, taken as a whole, I suspect more than half the revenues for those thirty companies come from outside the US.

  • Report this Comment On November 08, 2010, at 2:09 PM, shaileshnita wrote:

    This is a very intelligently written article. The author's tone and his arguments about investment principles are really admirable.

  • Report this Comment On November 08, 2010, at 4:44 PM, Montyr wrote:

    I sure have to agree with your sentiments in this article. When I saw where the North American economy was going, I had a good look at where our money was going and followed it right to China.

    I believe the most responsible thing we can do to save our economy is to look after our own personal economies.

    Thanks

    Monty www.luckystrikeresources.com

  • Report this Comment On November 11, 2010, at 4:02 PM, Brent2223 wrote:

    I think the idea of 'buy American' is to try and keep to keep capital in the country so that there is a base for recovery as opposed to watching all the capital continue to flee to emerging markets. I found this article overly simplistic, and a tad dangerous as it's just flaming the fire of indifference that's killing America. There is no common goal, just do whatever you can for your own benefit. Look at the comments, the general theme seems to be no one is happy because Ford survived, they're just laughing at the suckers who didn't make as much money as they did.

  • Report this Comment On November 12, 2010, at 9:31 AM, theHedgehog wrote:

    "Heartstrings ads" are popular right now - practically every ad on CNBC has a spokesperson with a soft loving emotional voice; whether they are male or female. It's really starting to get annoying.

  • Report this Comment On November 12, 2010, at 4:21 PM, JCoeur wrote:

    Buying from big American corporations is actually unpatriotic, based on what these companies do with their money and jobs. Their CEO's send jobs overseas and aggravate wealth disparity in the US by overpaying themselves and their cronies.

  • Report this Comment On November 12, 2010, at 9:01 PM, Preppy99 wrote:

    I don't know about investing in F at this point but I will say that I will be buying Ford cars simply because they have a great product and I like to support American if I can... plus ford has competitive prices... cheaper than toyota in most classes. So if anyone thinks that America can't compete in the global markets then they haven't looked at what the data is saying. China can build autos here in the US and ship them back to China and it still costs less than building them there because they have such a huge real estate bubble going on! So even after they pay shipping and higher labor prices to build in the US it is still cepaer to build them in the US. Invest in Emerging Markets and small and Medium sized US companies if you want to make any money in the markets.

  • Report this Comment On November 13, 2010, at 12:27 AM, whyaduck1128 wrote:

    I've been very pleased with my investment in F stock, having purchased one lot in January (+40.52% since then) and another in June (+63% since then). I only wish each lot had been bigger--but I'm leery of putting too much into any one stock.

    I also bought a Ford Fusion hybrid this week. Wonderful car, and after two days, it still hasn't been hit! Ironically, though, this car from a quintessentially American company is assembled in Hermosillo, Mexico.

    I found the headline of this article to be misleading, but, unlike many, I read it anyway. It makes some good points, but not enough to dissuade me from eliminating any particular part of the world from my investment consideration. Perhaps 2011 will be the year for foreign stocks, since "American" stocks have beaten them handily this year.

  • Report this Comment On November 13, 2010, at 10:39 AM, socrates29 wrote:

    This is a ridiculous article.

    If I invest only in foreign stocks, I profit when foreign countries or businesses prosper. I am less likely to support any U. S. policies or initiatives that may adversely affect these foreign entities.

    Should I be happy if GM and Ford go bankrupt because it makes my investment in Toyota more profitable? Should I cheer whe my international stocks rise in value even though our balance of trade situation becomes more grim with every passing day?

    If we invest in American companies, we have a stake in their success. We will support them and policies that help them become more viable.

    It is a shame that we glorify making money on foreign investments. We should be more concerned about jobs and financial stability in this country.

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Toyota Motor Corp… CAPS Rating: ***
WMT $77.66 Up +0.44 +0.57%
Wal-Mart Stores CAPS Rating: ***

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