Blog : US Government Fails Analysis

by Peter Leeds on July 31st, 2011

I understand that the American government is not a penny stock. It is, however, very much like a business. While Leeds Analysis helps us find the best penny stock investments, it can also be applied to just about any corporation, whether penny stock or blue chip. It can, as well, be applied to that massive corporation that we call the government. Sadly, the company that is our nation fails our penny stock analysis... very badly.

US fails penny stock analysis

Raising the debt ceiling or not, getting massive budget cuts or not, actually makes little difference. When put through our grueling Leeds Analysis, which we apply to hundreds of penny stock investments each week, the government gets a very big "F."

When we look at penny stock companies, we look at things like debt load, ability for the penny stock to repay the debt, revenue momentum, competition, management, and more. Leeds Analysis is a 29 point system for finding the absolute best penny stock picks, and avoiding the penny stock duds.

While we find that 95% of penny stock corporations do not pass Leeds Analysis, we know that the 5% that do are significantly more likely to outperform, and make big profits for our penny stock subscribers.

Now, our government unfortunately is in that 5% that fails. If they were a penny stock, we would have stopped our analysis within 5 minutes, as it would be obvious that they would not make a good investment. While not a penny stock, the same rules can be applied.

Our government is fiscally weak. High and rising debt, with no capability to pay it off. Rising "layoffs" (unemployment), strong competition (from China, Germany, Brazil, India...), and questionable management (Senate and Congress games and posturing).

True, as a penny stock, we could say that we've seen worse. Yet, our government is certainly not in any position of fundamental strength or fiscal improvements. Right now, all the debt ceiling and spending cut debates are merely to pay bills that we already owe, and find ways to cover our interest costs and keep entitlements from shutting down. If they were a penny stock, we would look the other way. If they were a penny stock, we would forget about them and move. If they were a penny stock, there would be no way we would put them in front of the eyes of our penny stock newsletter subscribers.

What not all penny stock investors know, but penny stock investors that subscribe to Peter Leeds understand, is that our government, if it were a penny stock pick, would be a mistake.

Luckily, just like penny stock companies, the government can improve. It can turn things around. But, as The Penny Stock Professional, I wouldn't suggest betting on (or investing in) any penny stock that looked like the Government looks right now.

In fact, I would never allow my company to get into the shape that the government has put us in. It is amazing to see how much they've let things deteriorate over the last 20 years. We've lived the high life, and now it's time to pay the piper.

I always have suggestions in mind, even if not offered to the penny stock companies we review, for improvements. I see ways that any penny stock could advance. Thus, I also have thoughts or how America could turn things around.

Here's what I would suggest America, or any penny stock is such a situation, do:

  • Dramatically cut spending across the board
  • Consolidate operations
  • Improve efficiencies
  • Increase revenues
  • Pay down debt

Each of these points could be a discussion in itself for any penny stock, and certainly for our government. Hopefully, some or all of these generalized concepts gets implemented.

Consider that I've seen penny stock companies that need to do this, and the ones that do usually turn things around. The penny stock that doesn't, unfortunately, keeps on sinking.

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