Ex-TARP chief eyes bid for Calif. governor

The man behind the infamous TARP program amid the $700 billion bank bailout is thinking about running for governor of California.

Neel Kashkari, who was in charge of the government's Troubled Asset Relief Program, has visited 80 communities in the Golden State as he explores his bid for political office. And he's vowing to be a different kind of Republican in a deep-blue state where the GOP has struck out in recent years.

"My focus is different from most candidates that we've seen, not just in California but around the country," Kashkari told the San Francisco Chronicle in what's billed as his first major interview.

Kashkari was an assistant Treasury secretary in George W. Bush's administration when his office set up the program to buy troubled assets from financial firms. The former Goldman Sachs vice president stayed on the job at Treasury for a short while at the start of Obama's first term. He left in December 2009 to join Pimco, which manages the world's largest bond fund.

Kashkari, 40, has been getting advice from former secretary of State Condoleezza Rice and two ex-governors — Florida's Jeb Bush and Indiana's Mitch Daniels — about his political aspirations. He supports abortion rights and same-sex marriage and voted for President Obama in 2008, according to the Chronicle.

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California Gov. Jerry Brown, a Democrat, is up for re-election in 2014. A recent poll by USC/Los Angeles Times showed less than one-third of California voters, or 32%, would support Brown's re-election next year.

If Kashkari does jump into the governor's race, he'd have to get past a Republican primary field that includes veteran pols such as Abel Maldonado, a former lieutenant governor.

Follow @ccamia on Twitter.

4 Stocks Triggering Breakouts on Big Volume

DELAFIELD, Wis. (Stockpickr) -- Professional traders running mutual funds and hedge funds don't just look at a stock's price moves; they also track big changes in volume activity. Often when above-average volume moves into an equity, it precedes a large spike in volatility.

>>5 Stocks Poised for Breakouts

Major moves in volume can signal unusual activity, such as insider buying or selling -- or buying or selling by "superinvestors."

Unusual volume can also be a major signal that hedge funds and momentum traders are piling into a stock ahead of a catalyst. These types of traders like to get in well before a large spike, so it's always a smart move to monitor unusual volume. That said, remember to combine trend and price action with unusual volume. Put them all together to help you decipher the next big trend for any stock.

>>5 Stocks Under $10 Set to Soar

With that in mind, let's take a look at several stocks rising on unusual volume today.

TearLab

TearLab (TEAR) is an in-vitro diagnostic company. This stock closed up 8.5% at $11.48 in Friday's trading session.

Friday's Volume: 1.26 million

Three-Month Average Volume: 562,768

Volume % Change: 165%

From a technical perspective, TEAR ripped sharply higher here right above its 200-day moving average of $9.77 with strong upside volume. This move is quickly pushing shares of TEAR within range of triggering a big breakout trade above a key downtrend line that dates back to late July. That breakout will hit if TEAR manages to take out Friday's high of $11.50 and then once it clears more near-term overhead resistance at $12.39 with high volume.

Traders should now look for long-biased trades in TEAR as long as it's trending above Friday's low of $10.22 or above its 200-day at $9.77 and then once it sustains a move or close above those breakout levels with volume that hits near or above 562,768 shares. If that breakout hits soon, then TEAR will set up to re-test or possibly take out its next major overhead resistance levels at $13.80 to its 52-week high at $15.18.

Constellium

Constellium (CSTM) designs and manufacture rolled and extruded aluminium products, primarily for to aerospace, automotive and packaging markets. This stock closed up 9.4% to $18.85 in Friday's trading session.

Friday's Volume: 5.79 million

Three-Month Average Volume: 294,603

Volume % Change: 2694%

From a technical perspective, CSTM spiked sharply higher here back above its 50-day moving average of $18.81 with monster upside volume. This move is quickly pushing shares of CSTM within range of triggering a major breakout trade. That trade will hit if CSTM manages to take out some near-term overhead resistance levels at $19.51 to $19.68, and then once it takes out more resistance at $20.53 to its all-time high at $20.67 with high volume.

Traders should now look for long-biased trades in CSTM as long as it's trending above Friday's low of $17.50 and then once it sustains a move or close above those breakout levels with volume that hits near or above 294,603 shares. If we get that move soon, then CSTM will set up to enter new all-time-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $25 to $27.

Penn National Gaming

Penn National Gaming (PENN) is a diversified, multi-jurisdictional owner and manager of gaming and pari-mutuel properties. This stock closed up 6.5% at $13.68 in Friday's trading session.

Friday's Volume: 4.24 million

Three-Month Average Volume: 3.77 million

Volume % Change: 260%

From a technical perspective, PENN jumped higher here right off its 50-day moving average of $12.77 with heavy upside volume. This stock has been uptrending strong for the last three months, with shares soaring higher from its low of $11 to its recent high of $13.88. During that uptrend, shares of PENN have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of PENN within range of triggering a near-term breakout trade. That trade will hit if PENN manages to take out Friday's high of $13.74 to its 52-week high at $13.88 with high volume.

Traders should now look for long-biased trades in PENN as long as it's trending above its 50-day at $12.77 or its 200-day at $12.28 and then once it sustains a move or close above those breakout levels with volume that's near or above 3.77 million shares. If that breakout hits soon, then PENN will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $18 to $20.

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Shutterstock

Shutterstock (SSTK) operates marketplace for commercial digital imagery. This stock closed up 8.5% at $72.39 in Friday's trading session.

Friday's Volume: 566,000

Three-Month Average Volume: 231,198

Volume % Change: 95%

From a technical perspective, SSTK ripped sharply higher here back above its 50-day moving average of $66.95 with above-average volume. This stock has been trending sideways for the last month and change, with shares moving between $64.01 on the downside and $76.12 on the upside. This spike on Friday is quickly pushing shares of SSTK within range of triggering a major breakout trade above the upper-end of its recent sideways trading chart pattern. That breakout will hit if SSTK manages to take out Friday's high of $73.82 to $75.72, and then once it takes out more resistance at $76.07 to its all-time high at $76.12 with high volume.

Traders should now look for long-biased trades in SSTK as long as it's trending above its 50-day at $66.95 and then once it sustains a move or close above those breakout levels with volume that's near or above 231,198 shares. If that breakout hits soon, then SSTK will set up to enter new all-time-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $80 to $85.

To see more stocks rising on unusual volume, check out the Stocks Rising On Unusual Volume portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.

RELATED LINKS:

>>5 Stocks With Big Insider Buying

>>3 Stocks Under $10 Moving Higher

>>Buy These 5 REITs to Cash in This Year

Follow Stockpickr on Twitter and become a fan on Facebook.

At the time of publication, author had no positions in stocks mentioned.

Roberto Pedone, based out of Delafield, Wis., is an independent trader who focuses on technical analysis for small- and large-cap stocks, options, futures, commodities and currencies. Roberto studied international business at the Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany. His work has appeared on financial outlets including

CNBC.com and Forbes.com. You can follow Pedone on Twitter at www.twitter.com/zerosum24 or @zerosum24.

Federal workers must pay back jobless benefits

The federal government shutdown cost taxpayers billions of dollars but at least a tiny fraction will be recouped: Federal employees will get paid just once—not twice-- for not working.

All federal employees who collected unemployment insurance during the 16-day shutdown will have to return the payments because the workers are also receiving back pay, the Labor Department said late last week.

The agency earlier this month said it expected to issue guidance that likely would result in some states allowing federal employees to keep both the jobless benefits and the retroactive pay, depending on individual state laws.

In Oregon, for instance, a law permits employees to keep the benefits even if they receive back pay, as long as they did not perform any services during their furloughs. About 730 federal workers in Oregon made an initial claim for unemployment insurance during the shutdown and received about $390,000 in benefits, the state Employment Department says. The state paid the benefits but said it expected to be reimbursed by the federal government.

But in guidance to states late last week, the Labor Department said that, because they were in "pay status," all furloughed employees "were not 'unemployed' and are thus ineligible for unemployment benefits."

The Oregon Employment Department said in a news release that it now will tell federal employees the benefits "are an overpayment and must be repaid." It added that the Labor Department changed the directive it had issued earlier this month which said that federal employees were eligible for unemployment insurance.

Nationally, about 70,000 of the 400,000 federal employees furloughed during the shutdown applied for jobless benefits, but a much smaller number took the steps required to receive them, federal and state labor officials say. They generally collected the payments for just one week because they worked during parts of the shutdown's first and third weeks.

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Even before the Labor Department's recent guidance, the agency had said it was clear that federal employees in most states would have to repay the benefits.

Align Technology: Invisible Braces Equal Visible Gains

Its braces might be invisible but Align Technology’s (ALGN) gains are not.

Getty Images

The maker of transparent braces and other dental products reported earnings of 42 cents a share, week above analyst forecasts for a 30 cent profit. Revenue, meanwhile, rose to $164.5 million, above the $158.6 million forecast.

William Blair’s John Kreger and team are impressed:

We are encouraged by the strong results, which stand in stark contrast to second half 2012 when volume growth and margins declined unexpectedly. Align’s Invisalign is clearly gaining market share, generating 16% unit growth in an environment where overall orthodontic procedures are essentially flat by our estimates.

Stifel’s Jonathan Block and Ethan Roth can barely contain their excitement. They write:

Our entire 2014 leverage thesis played out in 3Q13 as ALGN significantly beat EPS numbers…yet we were silly enough to make a cautious call in front of the quarter. That said, we think our 2014 $1.66 versus the Street's $1.53 should no longer be viewed as an "unrealistic expectation" and we believe consensus likely brings their estimates up to us….overnight. Align seems to be in the sweet spot as past investments (APAC, N.A. sales reps) are starting to pay off and new innovations (SmartTrack) are resonating with docs and helping to drive utilization higher. We are raising our 2014 and 2015 EPS estimates. Reiterate Buy and increase PT from $54 to $57.

Cantor Fitzgerald’s Jeremy Feffer upgrades Aligns shares to Buy from Hold:

After seemingly hitting bottom in 3Q:12, ALGN has taken concrete steps to revitalize its North American GP dentist segment, stabilize/improve pricing, and build a formidable O-U.S. sales and training operation, all of which are paying dividends. With better overall volume trends, the ClearCorrect ITC victory, and the Realine launch, we see plenty of runway for continued outperformance.

Shares of Align have surged 24% to $57 at 12:37 p.m. Sirona Dental Systems (SIRO) has risen 0.8% to $69.61, Dentsply International (XRAY) is up 0.1% at $45.44, Integra Lifesciences (IART) has  gained 0.4% to $44.23 and Danaher (DHR) has fallen 0.3% to $72.13.

Earnings roundup: Coke fizzy, Schwab soars

Charles Schwab stock soared in Tuesday afternoon trading after announcing that its third-quarter net income climbed 19%.

Trading and interest revenue also rose, beating analysts' forecasts.

Schwab's active broker accounts grew 3% from a year ago, to nine million. Revenue rose 14% to $1.37 billion from $1.2 billion. Wall Street was looking for $1.34 billion in revenue.

Shares climbed 5% on the news, with the stock at its highest level in more than five years.

TUESDAY STOCKS: How markets performed

Also up, by lesser amounts, were Dow Jones industrial average members Coca Cola and Johnson & Johnson.

Banking giant Citigroup missed analysts estimates, notching earnings of $1.02 a share, under the $1.04 estimate, on revenue of $17.9 billion.

Profit was up at Coke as the world's biggest beverage maker managed to sell more of its drinks despite choppy economic conditions.

The maker of Sprite, Powerade and Vitaminwater in addition to its namesake brand, said global sales volume edged up 2%, helped by its performance in countries such as China, India and Russia.

Still, the Atlanta company conceded that it was facing an economic slowdown in many parts of the world including Mexico, where the government is also considering a tax on sugary soft drinks.

In a conference call with analysts, CEO Muhtar Kent pushed back at the suggestion that the company's days of growth were coming to an end. He noted that the company is emphasizing affordability and smaller packages to "keep the drinkers base growing" in developing markets.

The company said its namesake brand saw volume growth of 22% in India. In China, soft drink volume rose 8%.

Johnson & Johnson benefited from a big jump in prescription drug sales and continued recovery of its consumer health business. Those successes helped the health care giant overcome a new problem, slumping sales of its medical devices.

That was mainly due to pricing pressure in the U.S. that forced J&J to ! cut prices for devices including diabetes testing products and spine and hip replacement parts, and trouble integrating part of the product line and sales force of orthopedic products maker Synthes, bought last year for $20 billion in J&J's biggest acquisition ever.

Stock of the New Brunswick, N.J.-based company is near its 52-week high of $94.42.

J&J said Tuesday that net income was $2.98 billion. Excluding one-time charges, it earned $1.36 per share, 4 cents better than analysts expected.

"We are still seeing (health care) utilization rates that are essentially flat year over year," Chief Financial Officer Dominic Caruso told analysts on a conference call.

Contributing: The Associated Press

Q3 magazine ad revenues up 4% to nearly $4.8B

American consumer magazines are showing some signs of life.

Despite a decline in ad pages sold, U.S. magazines' print ad revenues rose 4% during the third quarter to $4.75 billion as rebounding readership allowed publishers to charge more, according to new data from Publishers Information Bureau, a unit of MPA -- The Association of Magazine Media.

Print ad pages in the 200 magazines that are members of the association continued to decline in the third quarter, down 1.8% from a year ago. But digital ads in tablet editions -- up 6.8% among 58 e-magazine titles measured - helped offset the loss. Tablet ad units increased 17.5% during the third quarter, it said.

Magazine readership has been inching up this year -– up 2.6% in the first half of this year in both printed products and tablets –- and publishers have been able to fetch more dollars for print ads.

"This is an encouraging trend, with consistent advertising growth in magazine media across platforms," said Mary Berner, CEO of the magazine association. "Marketers are shifting dollars in some instances from print to tablet editions, but continue to invest in magazine media. Print is improving and the tablet business is growing."

The number of magazines that reported increases in ad pages and revenue almost doubled this year from a year ago.

HGTV Magazine, a unit of the cable TV network owned by Scripps Networks Interactive, had the highest increase in ad sales, up 298% to $7.8 million.

Ten of 18 magazines published by Condé Nast, led by Bon Appétit and Details, reported an increase in ad pages old, the company said.

Ad sales at People, which generates the industry's highest ad revenue, rose 21% to $273 million. The number of pages sold was up 14%.

The following magazines reported an ad sales increase of at least 30%: Barrons, Eating Well, ESPN Magazine, Every Day with Rachael Ray, Fine Cooking, Fit Pregnancy, Health, HGTV Magazine, In Touch Weekly, Life & Style Weekly, Men's Fitness, Muscl! e & Fitness Hers, OK Weekly, Ser Padres, Sports Illustrated for Kids, Star and Women's Health.

More drug ads – up 28.7% in revenue -- were placed than any other category, followed by food and toiletries/cosmetics.

Thursday Closing Bell: Markets Move Higher on Jobs, Yellen

November 21, 2013: U.S. equity markets opened higher Thursday morning following a better-than-expected report on new claims for jobless benefits. Fed chair-designate Janet Yellen's appointment has passed out of a Senate committee and is headed for a confirmation vote by the full Senate sometime after the Thanksgiving holiday. Yellen's all-but-certain confirmation may have played a bigger role in the stronger equity indexes than did the employment report.

European, Asian, and Latin American markets all closed mixed again today.

Friday's calendar includes speeches by Kansas Cit Fed President Elizabeth George and Fed Governor Daniel Tarullo and the following scheduled data releases and events (all times Eastern):

10:00 a.m. – Job Openings and Labor Turnover Survey (JOLTS) 10:00 a.m. – E-commerce retail sales 11:00 a.m. – Kansas City Fed manufacturing index

Here are the closing bell levels for Thursday:

S&P500 1795.85 (+14.48; +0.81%) DJIA 16009.99 (+109.17; +0.69%) NASDAQ 3969.15 (+47.88; +1.22%) 10YR TNOTE 2.792% (+0.125) Gold $1,243.60 (-14.40; -1.1%) WTI Crude oil $95.44 +1.59; +1.7%) Euro/Dollar: 1.3482 (+0.0042; +0.31%)

Big Earnings Movers: Target Corp. (NYSE: TGT) is down 3.5% at $64.19. Sears Holdings Corp. (NASDAQ: SHLD) is down 2.9% at $59.93 on a wider loss and tepid outlook. Green Mountain Coffee Roasters Inc. (NASDAQ: GMCR) is up 14.1% at $70.57 indicating that investors liked the results posted after markets closed on Wednesday. Dollar Tree Inc. (NASDAQ: DLTR) is down 4.5% at $56.28. Abercrombie & Fitch Inc. (NYSE: ANF) is down 0.1% at $34.97.

Stocks on the Move: Sprint Corp. (NYSE: S) is up 8.2% at $7.95 even though the firm's service was ranked last in new Consumer Reports survey. Voxeljet AG (NYSE: VJET) is down 13.8% at $33.82, the third day in a row the stock has been hit with double-digit losses. Organovo Holdings In. (NASDAQ: ONVO) is up 11.5% at $8.86 after getting beaten up in the 3D printing debacle yesterday.

In all, 148 NYSE stocks put up new 52-week highs today, while 71 stocks posted new lows.

Investing in Twitter Through ETFs

NEW YORK (TheStreet) -- Thursday's big news was that Twitter filed a confidential S-1 form with the SEC, which is the first regulatory step in the process for an initial public offering or IPO. The significance of the word confidential is that, under the JOBS act, companies with revenue less than $1 billion do not need to disclose their numbers in this first step of the process.

Although the actual listing probably won't happen until early next year, there is already plenty of speculation about what the value of the company might be when it actually starts trading. On many accounts, the company had a private market value of $10 billion earlier this year, leading some to conclude that the pricing of the IPO in a few months could be around $14 billion. Regardless of its initial value the stock could go higher right away, along the lines of other social media companies like LinkedIn (LNKD), whose IPO was priced at $45 and closed its first day of trading at $94.25. [Read: Will Twitter Sell Its Soul Like Facebook Did?]

There will be several ETFs that will offer different levels of exposure for investors interested in owning Twitter but not wanting to take single-stock risk.

The Global X Social Media ETF (SOCL) added Facebook (FB) after 10 days of trading. At the time, CEO Bruno del Ama was quoted as saying that waiting 10 days before adding it to the fund could avoid some of the initial volatility. Regardless of whether there is more volatility in the first few days for Twitter stock, based on current numbers under the hood of SOCL, Twitter would be the fifth-largest holding with perhaps a high single-digit weighting in the fund. Of course, Facebook is by far the largest company in the space, but the weighting is capped and currently is 12% of the fund, which is the same weighting as Tencent Holding (TCEHY) and Sina (SINA), which are both Chinese companies. Twitter's potential weighting in SOCL would be enough to move the needle right away. [Read: The 5 Dumbest Things on Wall Street This Week: Sept. 13] The other ETF likely to add Twitter soon, and in a meaningful weighting, is the First Trust DJ Internet Index Fund (FDN). Based on FDN's current constituency, Twitter could be a top-10 holding, with approximately a 3%-4% weighting. FDN's largest holdings are Google (GOOG), Amazon (AMZN), eBay (EBAY) and Facebook. Stocks are eligible for inclusion once they have three months of trading history.

A third fund likely to add Twitter is the First Trust U.S. IPO Index Fund (FPX). IPOs can be added on the first day of the next calendar quarter and remain in the fund for their first 1,000 days of trading. Based on current numbers, the Twitter IPO would be about the 20th largest holding, and so only have around a 1% weight, which would be less likely to move the needle on the fund. That is unless, of course, the stock goes on to be wildly successful and grows into a larger weighting in the fund.

FPX is a broad-based fund that potentially serves as a core equity holding. FPX has reasonably diversified sector exposure, with 26% in consumer discretionary, 21% in tech and 16% each in energy and health care. It also has exposure to industrials, financials and staples, but has little to no exposure in materials, utilities and telecom. [Read: 5 Must-See Charts of Big Trades to Take This Week]

The bull case for Twitter simply revolves around the extent to which it provides a means for media outlets, companies, athletes and performers to communicate with its audience, customer base or fan base in a way that previously did not exist. Obviously, friends and colleagues can also communicate with each other.

The three ETFs profiled above offer different levels of potential involvement in a much-anticipated IPO. There can be no assurances that Twitter will actually come public and no guarantee that it would be included in any ETF. However, if it does, it will be eagerly anticipated and widely followed, which makes it very likely that ETF providers will want to include it in their funds, where appropriate. At the time of publication the author held no positions in any of the stocks mentioned. Follow@randomroger This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

This contributor reads: Credit Writedowns Pragmatic Capitalist Mike Shedlock Barry Ritholtz John Hussman On Twitter, this contributor follows: TheStalwart ETF Database zerohedge financial acrobat

Cancellation reversal causes insurer headaches

Consumers are flooding their insurance agents with questions about whether and when they can get their canceled insurance polices back, now that President Obama says it's OK.

But those agents have few answers. They are still waiting for clarification from insurers, who are awaiting word from their state insurance commissioners and even the White House.

The CEOs of major insurers including Cigna, Aetna and Humana, met with President Obama Friday but left without talking to reporters about what will happen to plans that didn't meet the requirements of the Affordable Care Act. Meanwhile, the insurance commissioners for Vermont, Georgia and Washington state were among those saying they won't allow reinstatement of canceled policies.

"We've been advising our members to tell clients to sit back and wait as developments unfold over the next few days," says Jessica Waltham, senior vice president of government relations at the National Association of Health Underwriters, which represents insurance agents.

State insurance commissioners, the White House and the Department of Health and Human Services will need to provide "details as to how they would move this policy forward," she says.

"It's been non-stop since this whole thing started (Thursday)," says John Young, director of sales at Flexible Benefit Service Corp. in Rosemont, Ill. "Everyone wants to know what effect the president's message will have and, at this point, we just don't know until the insurance commissioner advises the carrier about what they'll allow."

Young, whose company handles group insurance policies and acts as a broker for about 1,000 insurance agents, was on a conference call Friday with Blue Cross Blue Shield of Illinois that offered few answers.

John DeGruttola, senior vice president of marketing and sales for insurer Optima Health, says it changing plans back "is going to be very difficult to administer."

"We went forward with the intent that this was the law of the land," says DeGruttola ! whose company only sells insurance in Va.."Nobody was focused on the existing plans. They were not filed (with the insurance commmissioner) nor were they approved."

While many state insurance commissioners had already allowed insurers to extend their plans into 2014 to allow consumers more time to make decisions, the Illinois insurance commissioner did not. Young says many agents have already put consumers into pricier new plans, but it "might be difficult to get a refund from the carrier."

"A lot has already been done" to switch people to new plans that comply with the ACA, says Young. Now, "there's incredible confusion" for those consumers about what to do.

Among the other details that remain to be worked out: Which insurers and insurance commissioners will OK the old policies now, whether insurers are allowed to raise the prices on the canceled policies and whether there will be additional financial help for insurers now dealing with more potential financial risk.

In Pleasant HIll, Calif., broker Colleen Callahan says she had been "steadily preparing comparisons and reviews" that are customized for consumers to help them plan for the new year. It's a "big project and it takes us quite a bit of time to prepare and present, either in person or by email first, followed up by a telephone call or an in person meeting," she says.

"The confusion now is that those currently insured are not sure of the next step. Do they have to make a change or can they keep their current plan?," says Callahan. "In some cases the premiums on the existing plans might be better and in some cases the new plan premiums might be better. It is all case-by-case."

Why Facebook Investors Should Fret That Young Teen Users are Leaving the Nest

If Facebook (Nasdaq:FB) can't keep teenagers on its social networking site, perhaps it can just buy their attention.

The Menlo Park, Calif. company's shares dropped last month after Chief Financial Officer David Ebersman told analysts on the third quarter earnings call that the service "did see a decrease in daily users, specifically among younger teens." This group remains key to Facebook's prospects because marketers believe teenage use often presages wider popularity, particularly in technology and Internet industries. Without strong teenage use, Facebook risks losing growth to other platforms such as Twitter (NYSE:TWTR), Tumblr or those still percolating in the mind of a teenage coder.

Facebook has already bought one big teen platform, Instagram, paying $1 billion in cash and stock last year for its 100 million users. On Wednesday, The Wall Street Journal reported that Facebook bid $3 billion for Snapchat, a two-year-old company with no revenue or earnings that has a smartphone app which delivers messages that disappear in 10 seconds or less. The Stanford University dropout who started Snapchat, Evan Spiegel, turned down the offer, holding out for $4 billion, the Journal reported.

That Facebook now is facing a decline in use by teenagers is ironic. CEO Mark Zuckerberg launched the social media site when he himself was a teen and an undergraduate at Harvard University. While his company now boasts 1.2 billion users, losing teens could suggest that the service may be losing relevance and that could hurt its ability to keep attracting advertisers, which provide the bulk of Facebook's $2 billion in quarterly revenue. MediaBistro reported in October that 61% of teens name Tumblr as their favorite social-media site, compared with 55% for Facebook. Facebook didn't comment on its use by teens.

Many of Facebook's users now are the parents of teenagers. "Teens have more and more environments in which it spend time through web-connected devices," said Brian Wieser! , an analyst with the Pivotal Research Group. David Kirkpatrick, the author of "The Facebook Effect," said teens are using "a range of things. My 21-year-old daughter, for instance, uses Twitter, Instagram and Pinterest for different reasons at different times. The Internet is seen as a palate of options." Pinterest is a content-sharing service that permits its members to "pin" images, videos and related features to their pinboards

"The case for Facebook changes as you get older," said Janney Capital Markets analyst Tony Wible. "Facebook is an important communications tool for older people but a 13-year-old doesn't have the same need for it. Younger people are spending their time with a lot of other things in media, like Instagram, Snapchat and the latest app on their cell phones.Video games, like Grand Theft Auto are also popular with them, and movies had a good third quarter in terms of incremental growth of media consumption."

Charles Haddad, a journalism professor at Stony Brook University in Long Island, said that he is hardly surprised that young teens are migrating from Facebook. "It's ever easier for them to switch," said Haddad. "The more interconnected we become, the easier it is to be restless and try out a new service. And young people are born restless. They want to be first to discover the latest and greatest."

Now, Facebook has the challenging task of creating for young teens the illusion of a cyber-community, where they will want to gather and exchange information and gossip. "Communities are valuable to companies because of the number of potential connections inherent," said Mel Bergstein, the retired CEO of Diamond Technology Partners, a consulting group that assists companies in excelling on social media. For a company, he said, "the bottom line is, the more people in a community, the more valuable it is."

The Bottom Line

If Facebook hopes to recapture the young-teen market, Zuckerberg will have to change the way it views these users – and itself. And that may mean more billion-dollar bids for hot new apps without business plans developed by twentysomethings barely out of college.

As Kirkpatrick mused, "Zuck likes to refer to Facebook as a 'utility.' But what teenager is going to get excited about a utility?"

Disclosure - At the time of writing, the author did not own shares of any company mentioned in this article.

J.C. Penney and Barnes & Noble Earnings — Amazon Wins Again

Investors seems to believe that J.C. Penney Co. Inc. (NYSE: JCP) showed signs of life when it released earnings, and that Barnes & Noble Inc. (NYSE: BKS) admitted it was doomed. No matter which side Wall Street takes of either case, all of the evidence shows that neither has made any advance against its real enemy — Amazon.com Inc. (NASDAQ: AMZN)

J.C. Penney advocates were cheered because same-store sales slid “only” 11.9%, while revenue crashed from $3.02 billion in the same quarter a year ago to $2.66 billion. (Also unmentioned was that the year-ago quarter was down more than 20% from the one before it.) The astonishing news was that:

Online sales through jcp.com were $215 million for the quarter, down just 2.2% when compared to the same period last year

The drop is unfortunate. The phenomenally small contribution of e-commerce in an age of retail e-commerce is stunning. Even if J.C. Penney makes a comeback of sorts, the part of its business that absolutely has to work does not.

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Barnes & Noble has been considered the original competitor to Amazon since Jeff Bezos launched it as an online bookstore in 1995. For several years, there was a reasonable debate about whether an online book business could beat a traditional one. Once the answer was clear, Amazon had broadened its inventory to areas from coffins to consumer electronics. Barnes & Noble was hardly all alone. It had lagged to the rear with other powerful retailers like Best Buy Co. Inc. (NYSE: BBY).

The long, drawn out war between the book company and the world’s largest e-commerce company finally has drawn to a close. Even the founder and chairman has passed on the opportunity to double down:

The company said its Chairman, Leonard Riggio, has advised the Board of Directors that he has suspended his efforts to make an offer for the company's Retail business. Mr. Riggio expressed a plan to make such an offer when he amended his Schedule 13D on file with the Securities and Exchange Commission in February.

In an amended SEC filing today, Mr. Riggio said, "While I reserve the right to pursue an offer in the future, I believe it is in the company's best interests to focus on the business at hand. Right now our priority should be to serve the more than 10 million customers who own NOOK devices, to concentrate on building our Retail business, and to accelerate the sale of NOOK products in our stores, and in the marketplace."

No one had to go beyond the same press release in which Riggio made his declaration:

The company reaffirms its previously issued full-year guidance, in which it expects Retail comparable store sales to decline in the high single digits and College comparable store sales to decline in the low single digits. The company also expects full-year Core Retail comparable bookstore sales to decline in the low- to mid-single digits.

Decline, on top of decline.

Monday Closing Bell: Markets Inch Higher after Weak Opening

November 11, 2013: U.S. equity markets opened lower Monday morning on a day when bond markets were closed in observance of Veterans Day and trading activity was relatively light. No U.S. economic data was reported today either nor were there any notable earnings reports.

European Asian and markets closed higher today while Latin American markets closed mixed.

Tuesday's calendar includes speeches by Dallas Fed President Richard Fisher, Minneapolis Fed President Narayana Kocherlakota, and Atlanta Fed President Dennis Lockhart and the following scheduled data releases and events (all times Eastern):

7:30 a.m. – National Federation of Independent Business small business optimism index 8:30 a.m. – Chicago Fed national activity index 11:30 a.m. – 3- and 6-month bill auctions 1:00 p.m. – 3-year note auction

Here are the closing bell levels for Monday:

S&P500 1771.89 (+1.28; +0.07%) DJIA 15783.10 (+21.32; +0.14%) NASDAQ 3919.79 (+0.56; +0.01%) 10YR TNOTE 2.747% (+0.0625) Gold $1,281.10 (-3.50; -0.3%) WTI Crude oil $95.14 (+0.54; +0.05%) Euro/Dollar: 1.3415 (+0.0057; +0.43%)

Big Earnings Movers: Gogo Inc. (NASDAQ: GOGO) is up 28.3% at $24.05. Gulf Resources Inc. (NASDAQ: GURE) is up 15.8% at $2.46.

Stocks on the Move: ViroPharma Inc. (NASDAQ: VPHM) is up 25.4% at $49.38 on a $4.2 billion buyout offer from London-listed Shire. Zalicus Inc. (NASDAQ: ZLCS) is down 72.3% at $1.30 on a failed drug trial.

In all, 128 NYSE stocks put up new 52-week highs today, while 32 stocks posted new lows.

Kospi Rally Leaves Brokers Behind as Profits Drop: Korea Markets

South Korean brokers are missing out on a rally that sent the nation's benchmark stock index to its highest level since 2011, as slumping trading volumes contribute to the weakest profits in eight years.

Samsung Securities Co. (016360), the country's biggest brokerage by market capitalization, and five of its local peers are valued at the lowest levels since at least 2007 after falling an average of 15 percent in Seoul this year. Industry earnings have shrunk to the smallest since the first half of 2005, while trading on the Korea Exchange (KOSPI) fell to a six-year low, data compiled by Bloomberg and the Financial Supervisory Service show.

South Korean securities firms have cut almost 2,000 jobs and closed more than 10 percent of their branches as individuals pull money from the stock market for the fifth-straight year. Midas International Asset Management Ltd. and KTB Asset Management Co. are avoiding the shares as growing competition among 62 registered brokers adds to the pressure on profits.

"We're not buying any brokerage stocks," Heo Pil Seok, the chief executive officer at Midas International, which oversees about $6.4 billion, said by phone on Nov. 6. "I don't plan to hold any for the next 10 years or so, unless I see real change like industry restructuring."

The Kospi rose 0.1 percent to 1,986.71 at 11:42 a.m. in Seoul, after falling 2.7 percent last week. The benchmark index for South Korea's $1.2 trillion stock market had rallied 16 percent from this year's low in June through Oct. 30 as rising exports sent economic growth to the fastest pace in almost two years.

Volumes Shrink

Trading has declined even as stocks advanced. The 100-day average value of shares changing hands on the South Korean bourse dropped to about 4 trillion won ($3.8 billion) on Nov. 8, within 0.5 percent of the lowest level since June 2007, data compiled by Bloomberg show.

Individual investors, who account for about half of equity trading, have pulled a net 4.3 trillion won from stocks this year as the highest rental costs since at least 1986 and growing household debt curb discretionary spending.

Competition among brokers has intensified after South Korea's National Pension Service, the nation's biggest investor, scrapped the minimum 0.15 percent fee it pays brokers in July, saying they need to "write down" commissions. The fund had about 410 trillion won of assets as of August.

Profit Slump

Earnings at domestic and foreign brokerages operating in South Korea shrank to 565.2 billion won in the six months ended June, about a third of the level reported two years earlier, FSS data show. That's the smallest figure since the industry posted a 294.9 billion won profit in the first half of 2005.

"Brokers have failed to showcase any kind of profit-making measures for investors to dive in," said Park Jae Hong, the chief money manager at Brain Asset Management, which oversees $4.2 billion from Seoul.

Samsung Securities is valued at about the same level as its net assets, an 18 percent discount to the MSCI All-Country World Financials Index, the biggest gap since February 2007. Daewoo Securities Co. (006800), the second-largest brokerage by market value, has a multiple of 0.8, while Woori Investment & Securities Co. trades for 0.6 times book value, according to data compiled by Bloomberg.

Equity volumes may rebound by the first quarter of next year as improving consumer and investor sentiment spurs South Koreans to return to stocks, according to Barclays Plc.

Cost Cuts

The Bank of Korea's gauge of consumer confidence rose in October to the highest level since May 2012 and the won gained 4.5 percent versus the dollar in the past three months. The nation's 10-year note yield has increased 34 basis points, or 0.34 percentage point, to 3.51 percent this year.

"There's a high chance that local individual investors will come back," Chanik Park, the Seoul-based head of Korea equity research at Barclays, said by phone on Nov. 7.

The industry is also relying on costs cuts and new investment-banking licenses to boost profits. Brokerages cut more than 4 percent of staff in the year ended June as they shut local branches, according to FSS data. Samsung Securities, Daewoo Securities and three other brokerages won approval from the Financial Services Commission to offer products including loans on Oct. 30.

'Bad Memories'

Samsung Securities is counting on investment-banking revenue and its prime brokerage business to help it get through this "crisis" period, the company said in an e-mailed response to questions from Bloomberg News. Daewoo Securities said it's expanding in overseas markets, while Woori Investment (005940) declined to comment before its planned earnings announcement on Nov. 14.

It will take time for new businesses to have a meaningful impact on brokerage earnings, said Lee Jin Woo, a Seoul-based fund manager at KTB Asset Management, which oversees about $6.7 billion. Banks are a better bet for investors seeking to benefit from South Korea's economic growth, Lee said.

Net income at Samsung Securities will probably drop 45 percent this year and Daewoo Securities may post a 59 percent decline, according to the average of analysts' estimates compiled by Bloomberg.

"I once had my hopes up," Lee said by phone on Nov. 7. "I only have bad memories when it comes to brokerage shares."

Confessions of a financial planner: My estate is not in order

Mary Beth Storjohann

Brian and I got married two years ago. At that time I went through all of our finances, combined accounts, changed names, updated beneficiaries, and made a list of items to complete: wills, powers of attorney and additional life insurance for me.

That was September 2011. While our finances are doing fine, our estate plan is only partially completed.

Time got away from me, as it does with all of us sometimes. We both completed the forms required by the military to get our wills done, but then I needed to be present to execute mine and since it was hard for me to get away from the office during the week, Brian got his copy completed before he deployed earlier this year, while my completed draft gathered dust on our desk and is now outdated and needs to be redone.

In addition, while I had every intention of getting additional life insurance (and even applied for it), it turns out there was an outstanding check-up that I hadn't completed some three years ago from a doctor referral and I can't qualify for coverage until that's completed. Another item to added back on the “To-Do” list.

However, I'm on a mission to get these items in place before year-end and, having just grabbed my now-outdated draft off of my desk, I thought there would be some good lessons in this:

1. As I mentioned previously, financial planners aren't perfect.

2. There is a common misconception (especially among the younger crowd) that in order to need an estate plan, you have to be “rich” or have a complex assortment of investments and items that would need to be dealt with if left behind. However, this couldn't be further from the truth.

For every client, having an estate plan is a necessity, and once you hit the age of 18 — you should have the proper documentation in place to make sure you're covered, no matter how simple your life is. Doing so will ensure that you remain in control of how your possessions are distributed at your death, that your wishes for medical care are carried out and that your minor children (if any) are cared for as you desire.

While it may be the case that you are just getting comfortable broaching the topic of estate planning with your parents about their wishes, it's important that you take some time to think about what you would want, as well.

When thinking about your need for an estate plan, consider the following:

• How do you want your personal assets to be distributed?

• Who stands to inherit them?

• Are there certain items or gifts that you would want to go to specific people? (For example, your assets could pass to your spouse, but you could indicate your grandmother's jewelry be passed to your sister or your DVD collection be donated to a local charity).

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Creating a will allows you to appoint an executor of your estate and provide details on how your assets should be distributed in the event of your death.

• Should you ever become incapacitated, who would you want to carry out any financial tasks on your behalf?

• Do you own a business? Who would take care of it?

A durable oower of attorney appoints a representative, such as a spouse, sibling or parent to perform certain actions on your behalf such as pay bills and make financial decisions, if you are unable to perform these tasks yourself.

• In case of a medical emergency, who do you want responsible for making decisions on your behalf if you are unable to make them yourself?

An advanced health care directive (or living will) documents which types of medical care, including life-sustaining treatments, you deem to be appropriate or inappropriate should you become incapacitated. A medical power of attorney designates a representative to carry out those wishes.

• If you have young children, who do you want to care for them should something happen to you and your spouse?

Without an appointed legal guardian, which can be stated in a will or trust, any interested parties ranging from family friends to relatives to social services agencies may apply for guardianship through the courts.

• Have there been any recent transitional changes in your life such as marriage, divorce, birth of a child or sickness?

Next ‘Transformers’ Bumblebee Camaro turns orange

LAS VEGAS -- Less bumble, more bee.

Chevrolet just unveiled the car stars of the next Transformers movie, and purists maybe in for a bit of a shock. That familiar Bumblebee, the Chevy Camaro that transforms into the lead character, has gone from lemon yellow to orange orange. It was displayed here at the SEMA aftermarket auto parts trade expo, along with the 2014 C7 Corvette Stingray from the movie and a newcomer to the film franchise, the Sonic RS rally car.

Change is in the air. The next Camaro is the 2014, customized for an even squintier look on the front end and with its own fancy LED rectangular taillights in back. So it only makes sense that Chevrolet would want to tinker with the hue a bit, making it somewhat edgier.

The Chevy presentation at SEMA of its new cars for the movie "Transformers: Age of Extinction." included this updated "Bumblebee" Camaro, as well as a new C7 Corvette and a Sonic RS.  Dan MacMedan USA TODAYFullscreen The Chevy presentation at SEMA of its new cars for the movie "Transformers: Age of Extinction." included this updated "Bumblebee" Camaro, one of the stars of the hit film franshise.  Dan MacMedan USA TODAYFullscreen The Chevy presentation at SEMA of its new cars for the movie "Transformers: Age of Extinction." included this updated "Bumblebee" Camaro.  Dan MacMedan USA TODAYFullscreen The Transformers badge on the front fender of the updated "Bumblebee" Camaro.  Dan MacMedan USA TODAYFullscreen The Chevy presentation at SEMA of its new cars for the movie "Transformers: Age of Extinction." included this metallic green 2014 C7 Corvette Stingray with black graphics and a giant rear spoiler.  Dan MacMedan USA TODAYFullscreen The Chevy presentation at SEMA of its new cars for the movie "Transformers: Age of Extinction." included this metallic green 2014 C7 Corvette Stingray with black graphics and a giant rear spoiler.  Dan MacMedan USA TODAYFullscreen The Chevy presentation at SEMA of its new cars for the movie "Transformers: Age of Extinction." included this cutsom Sonic RS.  Dan MacMedan USA TODAYFullscreen The Chevy presentation at SEMA of its new cars for the movie "Transformers: Age of Extinction." included this cutsom Sonic RS.  Dan MacMedan USA TODAYFullscreenLike this topic? You may also like these photo galleries:ReplayAutoplayShow ThumbnailsShow CaptionsLast SlideNext Slide

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Joining the cast is a menacing green Chevrolet Corvette Stingray, the current star of the Chevy stable, with black graphics and a giant rear wing that looks borrowed from an F1 racer.

And "introducing," as they say in movie credits, a new starlet, a Chevy Sonic RS rally car in black! , white a! nd purple and looking as scruffy and dirty as any good rally car should..

As movie placements go, General Motors involvement in the Transformers series has been one of Hollywood's notable big successes.

The newest film -- Transformers 4: Age of Extinction -- has just finished shooting and is due out in June as a summer popcorn movie. And there will be more transforming vehicles than the Chevies.

While the series tilts toward the juvenile, it has had no shortage of fans of all ages -- all apparently lured by the thought of cars and trucks that transform into personable alien robots and back again.

Twitter IPO shares aren’t for everyone

SAN FRANCISCO -- Twitter IPO shares aren't for everyone.

That's the word from the Ritz Carlton Hotel in Twitter's hometown here, where the company and its investment bankers gave a presentation to professional money managers Monday.

Members of the press weren't allowed into the room where the event was held, but we were able to ambush a half-dozen fund managers while they waited in a taxi line after the meeting.

Once accosted, I asked this question to those who said they had seen the IPO presentation:

Do you plan to buy Twitter shares?

Of the six who answered, one said "we're not allowed to talk about it," two said "yes," two said "not sure" and another said "no," while cursing the company's investment bankers.

"They'll oversubscribe it 10 times," said the man, who declined to give his name.

He was right, of course.

Demand was so strong for the shares that Twitter on Tuesday raised its IPO price range to between $23 and $25 a share.

At the mid-point of that price range, Twitter will raise $1.7 billion.

Among Internet technology companies that have gone public during the last three years, that ranks Twitter's IPO behind those of Facebook and LinkedIn in size, and slightly ahead of Groupon and Zynga.

It also gives Twitter an IPO valuation relative to annual revenue that is more similar to that of Facebook than LinkedIn, at the time of their respective offerings.

While Facebook has been a mixed bag for investors, depending on what price they bought its shares at, LinkedIn has produced market-beating returns and has never fallen below its $45 IPO price.

LinkedIn is now consistently profitable and valued at almost $27 billion, while Facebook, also profitable several quarters in a row, is valued at a staggering $122 billion.

Twitter, unprofitable and much smaller than those Internet advertising rivals, is expected to be valued at between $13 billion and $14 billion.

Twitter's sales are projected to rise 53% next year to $! 950 million, according to an estimate that the company's bankers provided to attendees of the presentation.

One of those who attended and said they were unsure whether they would place a bid on Twitter IPO shares was Sam Console, senior equity portfolio manager for Ranier Investment Management of Seattle.

He said the fund-management firm would consider the new forecasts for revenue and profit shared by Twitter's bankers before making their decision.

"We need to talk about it some more," said Console, who started his career as an equity analyst in 1996.

The tech IPOs conducted since Netscape Communications set off the tech stock boom that year have one important thing in common: a scarcity of shares.

By selling only a small slice of a newly-public company, Twitter's bankers are following a long-established game plan that ensures more buyers than sellers at the time of the IPO -- even though the offering is for 70 million shares.

Thanks to that imbalance of supply and demand, money managers who can get the stock at its IPO price this week could see a quick profit.

Longer term, what Twitter's stock performance will be for everyone else is anyone's guess now.

Estimates or Guesstimates?

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1. Clustering: It is remarkable that there is hardly any difference in the estimates which are made prior to the results, irrespective of whether it is a globally reputed brokerage house or a hole-in-the-wall broking outfit. My guess is that the larger ones base their estimates on the figures given out by the managements during 'closed-door' meetings, as well as the periodic 'guidance' given by them. The smaller ones simply piggyback on the larger brokers' estimates and pass them off as their own. In either case, there may not much analysis involved.

2. Variance: Often there is a significant variance between the estimates and the actual figures. Sometimes, even the direction of the actual results is not the same as that estimated. So much so, that in the USA, there is an indicator known as the "Earnings Surprise Indicator" which measures the variance of the variance. Confused….Well, you are not the only one.
To me, the whole exercise is quite absurd. I mean, in most firms each analyst tracks three to four sectors. Now, each of these will have a couple of humungous companies / conglomerates involved in a diverse range of activities. Given the number of moving parts, I think even the managements of these companies know that it is futile to indulge in quarterly predictions. However, the analyst at the brokerage house (who is often a multitasker and not an industry specialist) apparently can do what the top management of the company dare not, i.e. give precise predictions.

I also wonder who really tracks and believes these estimates. Seasoned investors may not even look at them as they have proved to be wrong on too many occasions. Maybe the media is more keen on knowing these numbers more than anyone else.

I am happy to see that some companies are desisting from providing quarterly guidance, as they believe that this practice encourages short-termism. If this trend gathers momentum, then, maybe, analysts will have to begin analysing and not merely reporting….

- Jayant Pai
(The author is the Head Marketing, PPFAS Mutual Fund)

Down a Billion - Lampert Sells in Review, AutoNation Update

A man of many hats and top investor Guru Edward "Eddie" Lampert also manages his firm ESL Investments. His third quarter portfolio lists 4 stocks at a total value of $2.99 billion, down almost a billion since April 2013. His quarter-over-quarter turnover is 0%.

Also the Sears Holdings Corporation CEO, Lampert spent a good deal of his 2013 trading time methodically reducing his involvement in the Sears spinoff, Orchard Supply Hardware, from over a million shares in the first quarter of 2013 to 158,399 shares as of May 29, 2013.

Spun off from Sears in December 2011 and acquired by Lowe's in September 2013 for $205 million, Orchard Supply Hardware stores have operated as a neighborhood home improvement, hardware and garden supplier, dating back to the Dust Bowl Era.

Lowe's Companies Inc. (LOW) is up 52% over 12 months. Sears Holdings Corporation (SHLD) is down 10% over 12 months.

With the Orchard Supply situation behind him, Edward Lampert's reductions in the second and third quarters have focused on systematically reducing his long-time AutoNation Inc. (AN) holding. Since the beginning of the third quarter, Lampert has reduced his AN position five times. In his latest trade, as of Oct. 30, 2013, Edward Lampert slightly reduced his position by 0.02%, selling shares in the average price range of $48.00 per share. The current share price is $48.12, with a change from average at 0%. See GuruFocus Real Time Picks for more trade details.

Lampert's five-year AutoNation history shows a phenomenal gain of 292% on 13,097,719 shares bought at an average price of $12.26 per share. He also gained 39% selling 59,453,152 shares at an average price of $34.65 per share.

Check out ten more gurus holding AN, including Paul Tudor Jones who made a new buy of 11,700 shares in the second quarter of 2013. He paid an average price of $44.63 per share and made a gain of 8.2%.

Here's a third quarter update on AutoNation Inc. with very active insider selling.

AutoNation Inc. (AN)

Predictability: 1 out of 5 Stars

Up 9% over 12 months, AutoNation Inc. has a market cap of $5.86 billion; its shares were traded at around $48.20 with a P/E ratio of 17.70. The company does not pay a dividend.

Incorporated in 1991, AutoNation Inc. is an automotive retailer in the US. The company owns and operates 265 new vehicle franchises from 221 stores located in the United States, as of December 31, 2012. AutoNation Inc. offers a range of automotive products and services, including new vehicles, used vehicles, parts and automotive services, and automotive finance and insurance products. The company also arranges financing for vehicle purchases through third-party finance sources.

The company reported financial results for the third quarter of 2013 with a 14% year-over-year increase in revenue at $4.5 billion. Operating income was reported at $187 million, also up 14% compared to the third quarter of 2012. AutoNation reported net income for the third quarter of 2013 at $93 million, up from $82 million in the same quarter a year ago. Earnings of $0.75 per share were also up 14% over $0.66 per share in the third quarter of 2012.

The company's total vehicle sales have also increased by 14% over the same quarter of 2012, and the nation's largest automotive retailer plans to buy a Honda store and a Hyundai store in Chicago, Illinois, set for completion in the last quarter of 2013, bringing in additional annual revenue of $85 million.

AutoNation's chairman and CEO Mike Jackson, commented in a company press release, "We delivered double-digit growth in EPS and operating income in the third quarter of 2013 compared to the prior year, driven by gross profit growth in all of our business sectors."

Tracking share price, revenue and net income:

[ Enlarge Image ]

Edward ! Lampert's average 12-month return is currently 34.5%. His top buys, sells and holdings in graphic summary:

GuruFocus Real Time Picks reports the stock purchases and sales that gurus have made within the prior 2 weeks. The report time lag can be as short as 2 days after the date of the transaction.

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Stocks Cap Biggest Rally in Two Years to Beat Bonds, Commodities

Global equities completed the biggest back-to-back monthly gain in almost two years, beating all other assets in October, as U.S. lawmakers avoided a debt default and investors speculated the Federal Reserve will maintain stimulus.

The MSCI All-Country World Index of stocks in 45 markets climbed 4.1 percent including dividends in October, bringing the two-month advance to 9.5 percent. The Standard & Poor's 500 Index rose 4.6 percent, the most since July. Bonds of all types returned 0.9 percent on average, the most since April, according to Bank of America Merrill Lynch's Global Broad Market Index. The Bloomberg Dollar Index fell less than 0.1 percent after touching its lowest level since February, while the S&P GSCI Total Return Index of 24 commodities lost 1.4 percent.

Congress's budget agreement helped shares rally and price swings to narrow in what has historically been the most volatile month for equities. Treasury yields slipped to a three-month low as the borrowing impasse caused a 16-day government shutdown, stoking speculation that the Fed will delay cutting its stimulus program until next year.

"We're in a sweet spot where the economy is strong enough to help push profits higher, but not strong enough to prompt Federal Reserve tightening," Alan Gayle, senior investment strategist and director of asset allocation at RidgeWorth Capital Management, said by phone from Atlanta. His firm oversees about $48 billion. "The lower level of global economic activity is putting a lid on commodity prices."

Europe Rebound

About $2.3 trillion was added to global share values in October as corporate earnings beat analysts' estimates and optimism grew that Europe is recovering from a recession. Shares in Greece and Italy were among the world's biggest gainers as European money managers received fresh cash from clients for a 15th consecutive week.

Expectations for volatility in financial markets fell for the month as investors shrugged off the U.S. congressional standoff. Bank of America Corp.'s Market Risk Index that uses options to forecast fluctuations in equities, currencies and bonds slumped 52 percent in October and reached a nine-month low on Oct. 22. The Chicago Board Options Exchange Volatility Index, the gauge of S&P 500 options prices known as the VIX, tumbled 17 percent last month, the most since July.

While the government shutdown will probably slow fourth-quarter gross domestic product by 0.3 percentage point, Fed policy makers will wait until March before scaling back the $85 billion of monthly bond purchases, according to a Bloomberg Oct. 17-18 survey of economists.

'Incredible Uncertainty'

"Even though you had this incredible uncertainty with Congress, at the end of day you had the Fed holding up the market like Atlas holding the world on his shoulders," Kristina Hooper, a U.S. investment strategist at Allianz Global Investors in New York, said in a phone interview. The firm oversees $409 billion. "That provides a level of comfort for investors."

Fed policy makers said Oct. 30 they would press on with the pace of monetary stimulus even as signs of "underlying strength" emerge, fueling speculation the central bank may taper asset buying in coming months.

The S&P 500 (SPX) extended its advance for the year to 23.2 percent, challenging 2009 for its best yearly gain in a decade. About 75 percent of the companies in the S&P 500 that reported earnings during the month exceeded analysts' profit forecasts, data compiled by Bloomberg show.

Equity Valuations

The rally has driven equity valuations to an almost four-year high, with the S&P 500 trading at 15.9 times estimated operating earnings. The benchmark index may end the year at 1,718, a 2.2 percent retreat from the closing level yesterday, according to the average of 19 estimates from strategists in a Bloomberg survey.

The MSCI Emerging Markets Index advanced 4.8 percent, completing its first back-to-back monthly gain since January. International investors added to equity holdings in 10 of the 12 developing nations tracked by Bloomberg in October as predictions for sustained Fed stimulus through March spurred demand for riskier assets.

Chinese shares performed worst among the world's 45 biggest markets as the Shanghai Composite Index dropped 1.5 percent, amid a surge in the nation's money-market rates. The seven-day repurchase rate, a gauge of funding availability in the banking system, jumped 20 percent for the month as policy makers are limiting the cash supply to help keep inflation in check.

'Every Reason'

Bank of America Merrill Lynch's Global Broad Market Index, tracking debt securities with a market value of about $46 trillion, has declined 0.5 percent in 2013, as of Oct. 30. Average yields fell 12 basis points, or 0.12 percentage points, last month to 1.9 percent.

The Bloomberg U.S. Dollar Index, which tracks the currency against 10 major peers, fell 0.01 percent. The gauge rallied yesterday, paring a deeper monthly decline, after the euro-area inflation rate unexpectedly cooled, fueling speculation the European Central Bank will cut interest rates to spur the economy.

"The resolution to the shutdown and the debt ceiling standoff brought both interest rates and the U.S. dollar lower," Jake Lowery, a portfolio manager focusing on global rates at ING U.S. Investment Management, which oversees about $180 billion from Atlanta, said Oct. 29 in a telephone interview. "October gave the Fed every reason to hold asset purchases steady at their upcoming meeting and perhaps longer."

Treasury Yields

U.S. Treasuries rose 0.6 percent as of Oct. 30, the second-straight monthly gain. Yields on 10-year U.S. government debt may climb to 2.8 percent by the end of the year, from 2.6 percent, according to the median estimate of 65 economists surveyed by Bloomberg News.

High-yield (BHYC) bonds rallied 2.4 percent last month as of Oct. 28 after gaining 1.8 percent in September, according to the Bloomberg Global High Yield Corporate Bond Index. Speculative-grade debt is rated below Baa3 by Moody's Investors Service and BBB- by S&P.

Greece's bonds were the best performers in October among the 26 sovereign markets tracked by Bloomberg and the European Federation of Financial Analysts Societies, rising 7.3 percent. Portugal's were second with a 3.4 percent gain. Australia's debt lost the most with a 0.1 percent decline.

Euro, Yen

The 17-nation euro gained 0.4 percent versus the greenback and Japan's yen fell 0.1 percent. Europe's currency is forecast to weaken to $1.33 against the dollar by the end of the year, from $1.3584, according to the median estimate of economists surveyed by Bloomberg. Japan's is estimated to weaken to 100 from 98.36.

Malaysia's ringgit rallied 3.3 percent against the greenback, the biggest gain of its 31 most-traded peers as the nation's equity index touched a record high. The government forecast growth of as much as 5.5 percent next year as Prime Minister Najib Razak pledged to support the economy while taking steps to meet the government's budget-deficit reduction goals.

Commodities fell for a second month in October amid sluggish global growth and signs of supply surpluses for everything from coffee to zinc. The S&P GSCI Total Return Index of 24 raw materials has fallen 2.3 percent this year, heading for the biggest annual loss since 2008.

Economic reports during the month showed that American employers added fewer jobs than expected in September while preliminary data indicated manufacturing from the U.S. to Europe expanded at a slower pace than forecast in October.

Oil, Copper

Crude oil slumped 5.8 percent. Total U.S. petroleum demand is at the lowest seasonal level in 15 years, according to data from the EIA, the Energy Department's statistics unit.

Copper fell last month for the first time since June. Inventories monitored by the London Metal Exchange have risen 49 percent this year.

"We're seeing a lot of supply come in various commodities, notably oil and copper," Walter "Bucky" Hellwig, who helps manage $17 billion of assets at BB&T Wealth Management in Birmingham, Alabama, said in an interview. "Scarcity and demand, the things that had driven commodities the past few years, have backed off a bit."

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Cotton prices fell 12 percent, reaching a nine-month low, as farmers are poised to collect a record harvest in India, the world's second-largest producer. Coffee futures capped the longest slump since 1972 as wet weather signaled rising production in Brazil, the top grower.

Gold Declines

Gold slid 0.2 percent in October, as speculation that the Fed will trim U.S. monetary stimulus sooner than anticipated erased gains for the month on the final day. Bullion is headed for the first annual loss since 2000 as some investors lost faith in the metal as a store of value.

Natural gas for next-month delivery gained 0.6 percent to $3.581 per million British thermal units. Prices rose to a five-month high during a cold snap in mid-October and have dropped 7.4 percent since then amid moderating weather and bigger-than-forecast increases in stockpiles of the heating fuel.

"The market should continue to trade with a bearish undertone until there is a clear sign that winter-like weather is finally starting to set in," Dominick Chirichella, senior partner at the Energy Management Institute in New York, said in a note to clients dated Oct. 29. "Demand has yet to have a major impact."