The S&A Digest: We're hiring...

We're hiring... Dan shows his hand... Riddle me this... Where do you put your gold?... Holding long term doesn't work...

Goldsmith comment: Porter is fly-fishing on the Gunpowder. Déjà vu... I feel like I've written this note before. Oh yeah, I have...

INTUITIVE, ICONOCLASTIC GENIUS WANTED FOR NEVER-ENDING QUEST TO FIND OUTSTANDING INVESTMENTS; WALL STREET-TYPE COMPENSATION AND INTERNATIONAL RECOGNITION AVAILABLE TO TRULY OUTSTANDING CANDIDATES.

We're looking for the sort of people who thought their professors were morons and who'd never survive the office politics of a large Wall Street firm... When we've tried hiring folks from mainstream sources – fancy colleges or investment banks – we've been consistently disappointed. Remarkably few people enjoy thinking for themselves... and even fewer can write about their thoughts in an entertaining way. Our greatest hiring successes have come, not surprisingly, from our subscriber base. Here is a group of people familiar with what we do... and often times better at it than we are.

While we're always in the market for a sharp mind with a quick wit and a ready pen, we're particularly in need at the moment... which might result in higher wages than we'd prefer to pay. We're looking for people who love finance, particularly stocks, and who want to spend untold hours reading about them and following up on promising opportunities. Experience isn't as important to us as intellectual firepower and ambition.

If you want a great job earning a six-figure salary, working from inside a railroad baron's mansion, and traveling the world to dig up great investment ideas, then send us a letter about yourself. Where have you been? What have you done? Why would an equity research firm want to hire you? Send your letter to saeditorialhires@gmail.com.

P.S. We admire people who are self made. And we've long since realized that the smartest people we know didn't do what everyone else was doing in their 20s or 30s. Example – one of the truly legendary people in our business drove a taxi rather than go to college. Another was one of the top ditch diggers in America. If you're smart, we'll know it.

This morning, we opened our e-mail to find the greatest single "buy" signal we know of... Ferris is very, very excited about the upcoming Extreme Value pick, due out to subscribers tomorrow evening...

"For the next issue of EVI, I'm recommending a company that:

"And it's nearly identical to a stock I recommended in Extreme Value last year." (That stock is up 31% in 18 months, and has been hitting new highs while the rest of the market goes haywire.)

We're offering Extreme Value at a huge discount right now. You can judge for yourself if Dan's work is as good as we say it is.

BNP Paribas, France's largest bank, is freezing three of its funds, saying it can't "fairly" evaluate its holdings as the subprime debacle roils the credit markets. The funds had about $2.76 billion in assets, with close to $1 billion in subprime loans. The bank will stop calculating net asset value for the three funds.

BNP now joins Bear Stearns and London's Union Investment Management as the three groups to halt redemptions.

The European Central Bank will offer unlimited funds at 4% to cool rising interest rates and increase liquidity.

A riddle from Jeff Clark...

"How do you trade a market that reaches hugely oversold conditions, gaps higher one morning, rallies nearly 200 points in the final half hour of trading one day, falls 280 points in eight minutes the next day, and then runs up over 400 points during the next three trading sessions?

"The answer is... you don't."

Read more of what Jeff has to say in today's Growth Stock Wire.

Company of the day: Scientific Games (SGMS) provides the government with printed lottery tickets and software to run the program. It also produces gaming machines for the public. The $3.6 billion company trades for 51 times earnings, 3.7 times sales, and 5.8 times book. SGMS is highly leveraged, with $30 million in cash and $1 billion in debt. I guess you can lever up when the government is your main customer... and I don't see people wising up to the "stupid tax" anytime soon.

New highs: Advisory Board Co. (ABCO), Alexander & Baldwin (ALEX), CARBO Ceramics (CRR), Covance (CVD), eBay (EBAY), Coca-Cola (KO), Sigma-Aldrich (SIAL), Nokia (NOK), Oakley (OO), Seabridge Gold (SA).

Porter will return with his sarcasm and wit tomorrow. Keep his BlackBerry buzzing... feedback@stansberryresearch.com.

"Your snide remark about Mitt Romney's five sons sounds like it was written by the Washington Post, that anti-Republican rag from hell. How many presidents can you name whose sons (or daughters) have enlisted in the military? Let's keep it to the last 50 years, for all these baby boomers and Cindy Sheehan to understand." – Paid-up subscriber Bill

"Regarding your comment 'there may be nothing more humiliating than running for president.' That may be... unless you are Ron Paul, the exception to all candidates out there. He can hold his head high. The only one that refuses lobby interest money and now has millions more in funds than McCain. He's for the Constitution and smaller government... power to the people! A ten-term congressman that has a squeaky clean voting record. Sound impossible to get him in? Just look at the results from the last debate... the debate in which the media barely gave Ron a chance to speak and had Romney all over their website as the winner before the debate was even half over! In case you have not heard... There is a revolution going on right now and we need you! Contact your local Meetup.com group to join in with your support. We have a chance to get our country back. It is our last chance. America's Hope www.RonPaul2008.com." – Paid-up subscriber Rhonnie Lynn

"I recently subscribed to Matt's Oil Report. It's the first business-type newsletter I've ever subscribed to and that has got me hooked on The S&A Digest. I read it every day. The reason I subscribed is because I don't know much about finance, and I'm trying to learn more about mine and my wife's stocks and mutual funds in our 401K plan (we're doing OK and with a very respectable firm – I don't know if I'm allowed to mention them by name, so I won't) but like everyone else if we could do better we'd like to. Let me get to the reason for this feedback. I just read a feedback from a subscriber and although I've never done this before either, I had to respond. He said he hated you like poison and called you a puke, a scumbag, and a liar among other things. If I felt that strongly, I surely wouldn't be a subscriber, so I imagine he has probably made pretty good money on some of your company's advice. Hate mail is one thing as is freedom of speech, but to actually tell someone 'I hate you like poison' is quite another. I've checked on the info I've received from this service, and it has all been on the up and up – I wish we had more money to invest. As a pastor, let me tell you that honesty is always the best policy, so stand firm and honesty will win out. I thank you for your service and hope I can scrape up enough $$ to continue my subscription and eventually add on more." – Paid-up subscriber Chuck

"You said: 'Might be a good time to check your holdings of gold and silver and make sure they're not in a federally regulated bank.' How does one find out if his bank is federally regulated and why is that important?"

– Paid-up subscriber John S.

Goldsmith comment: Call your bank to find out if it's federally regulated (as opposed to state regulated). The government can seize your assets in a federally regulated bank. It has to work much harder to seize coffee cans buried in your back yard.

"I see you are putting Extreme Value on sale for about half price. I may jump on that. But I have a question for you – Does Ferris ever give sell recommendations on his picks or are the readers on their own with that? I read the sales e-mail and didn't see anything about that. Does he not do it or did the copywriter leave that out?" – Paid-up subscriber James McGovern

Goldsmith comment: The holding periods for Ferris' stocks are usually several years. He's currently got stocks in his portfolio from 2002. Don't worry... When Dan feels it's time to sell, he'll let you know.

"I wonder if David Woodworth uses those despicable invectives within his mother's earshot? Many, many years ago, our parents taught us that small minds have limited vocabularies and resort to foul language to flesh out their thoughts." – Anonymous

"I would like to ask a question that I hope you will answer. It seems to me that this research is preoccupied with home run hitting – buying investments to hit them out of the park. In baseball, home run hitters strike out often. Is that not the same case here? Isn't it a whole lot safer to have many smaller, safer successes than a few home runs? To hit a home run, you must stay in the market a long time and weather precipitous downturns. I am not a great investor, but I have always lost money on so-called long-term investments. When I pay attention to sector strength and overbought/oversold conditions, I have made money. Comments?" – Paid-up subscriber Gary Blazo

Goldsmith comment: Every great investor out there will tell you that holding for the long term is the best way to make money in the stock market. According to a Legg Mason study:

We gathered the daily price changes in the S&P 500 over the past 30 years or so, in excess of 7,300 observations. The compounded annual return over the period (excluding dividends) was 9.5 percent. We then asked a simple question: What would happen to the return if we knocked out the 50 worst, and 50 best, days? The results are a testament to the impact of black swans. If you remove the 50 worst days (less than 0.7 of 1 percent of the sample), the return soars to 18.2 percent, 8,700 basis points above the actual results. Missing the 50 best days compresses the return to less than 1 percent, about a 900 basis point hit.

If you'd like to try to pick those 100 days, be my guest.

Regards,

Sean Goldsmith

Baltimore, Maryland

Stansberry & Associates Top 10 Open Recommendations

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Stansberry & Associates Top 10 Open Recommendations
(Top 10 highest-returning open positions across all S&A portfolios)

As of 06/27/2013