Have We Bottomed Yet?

Anyone with access to a radio or television, who also doesn't change the station when the news comes on, will know that the DJIA rose over 11% today! Now, the question I, and financial commentators are asking is this, "Have we bottomed yet?"

My answer is quite simply, "I don't know."

My portfolio increased 5.31% for the day, but I'm still looking at a paper loss of 7.5%. In dollars and cents, I had paper gains of $1,463.19, but am still holding a paper loss of $2,353.50.

Add to that the fact that over the next two months is "Earnings Season", when companies tell their investors and the world how much they made or lost. Well folks, I'm predicting good news for the following companies that I'm invested in;

• Heinz (HNZ)
• McDonalds's (MCD)
• Pepsico (PEP)

And I just wish I had been smarter and put some money into a position in Hershey (HSY).

Why am I predicting good news for these companies (which represent 20% of my total portfolio)? Well, they all started coming down as the price of commodities, the raw materials they need to make their products, began going up. To maintain their profit margins, they began a series of price increases, but now, the price of commodities is coming down (FAST), and they have made no move to lower their prices. In simple math, if you sell for $2 what it costs you $1 to make, your profit is $1, but if your cost goes down to $0.75 and you're still selling for $2, you are now making $1.25.

So, if you can, put your money in these stocks. In tough economic times, you can't go wrong investing in companies that make things people eat and/or drink.

Peace.