CubeSmart Keeps Dividend Steady at $0.11

Self-storage facility operator CubeSmart  (NYSE: CUBE  )  announced yesterday its second-quarter dividend of $0.11 per share, the same rate it's paid the past two quarters after raising the payout 38%, from $0.08 per share.

The board of directors said the quarterly dividend is payable on July 15 to the holders of record at the close of business on July 1. CubeSmart has paid a quarterly dividend every year since 2005 and has increased the payout each year since 2011.

The REIT's board also declared a quarterly dividend of $0.484375 per share for its 7.75% Series A cumulative redeemable preferred shares that is also payable on July 15 to holders of record on July 1.

The regular dividend payment equates to a $0.44-per-share annual dividend, yielding 2.6% based on the closing price of CubeSmart's stock on May 29.

CUBE Dividend data by YCharts

Bank of America Case Burns JPMorgan Chase

In the swirl of lawsuits facing the big banks over mortgage-backed securities, things can change seemingly on a daily basis. A recent example can be found in the sudden settlement between Bank of America (NYSE: BAC  ) and mortgage insurer MBIA (NYSE: MBI  ) , a squabble that had been brewing for some time, with no apparent end in sight.

Now, a suit AIG (NYSE: AIG  )  is pursuing against B of A has opened up a can of worms for peer JPMorgan Chase (NYSE: JPM  ) , as the judge in the latter case has cited the former litigation as proof that he had no jurisdiction to throw out claims by Dexia that MBSes it bought from Bear Stearns, Washington Mutual, and, on its own and as purchaser of those two entities, JPMorgan.

Venue change makes all the difference
The change stems from the fact that a New York appeals court is allowing the larger AIG v. Bank of America suit to be heard in state, rather than federal court. In the Dexia case, the judge used the Edge Act, which makes a distinction between domestic and foreign banking activities, to throw out the bulk of Dexia's case against JPMorgan.

But AIG's tenacity in its mission to recoup some of its crisis-era losses has spurred the megainsurer to push its case concerning $10 billion of crummy MBSes against B of A, despite a supposed vow to the latter by the New York Fed that the bank would not be responsible for such claims.

The decision to move the AIG case to a state rather than a federal venue was a big win for the insurer, and a blow to B of A. Now this complaint is proving to be a problem for JPMorgan, too.

Just the beginning?
Though the Dexia v. JPMorgan lititgation involves a small number of disputed securities -- 65 in all -- with a relatively small overall value of $774 million, this case is obviously important. At the time of the original ruling, the decision was hailed as a boon to big banks, which would now be considered immune from similar lawsuits.

JPMorgan apparently saw the suit as significant, as well, or it would not have put such time and effort into fighting it; given its small size, it surely would have been much cheaper to settle. Unfortunately for the big banks, this litigation news looks like the well-worn road of toxic MBS lawsuits just got a lot longer.

With big finance firms still trading at deep discounts to their historic norms, investors everywhere are wondering if this is the new normal, or if finance stocks are a screaming buy today. The answer depends on the company, so to help figure out whether JPMorgan is a buy today, check out The Motley Fool's premium research report on the company. Click here now for instant access!

3 Stocks That Blew the Market Away

Don't settle for ordinary quarterly reports.

Every week, I take a look at three companies that beat market expectations, since I believe that it's the biggest factor in a stock beating the market. Leaving Wall Street's pros with stunned expressions can be a good thing. It usually means that the companies have more in the tank than analysts figured. Capital appreciation typically follows.

Let's take a look at a few companies that humbled the pros over the past few trading days.

We can start with Molycorp (NYSE: MCP  ) . Shares of the rare-earth minerals miner soared 27% last week after the company posted a substantially smaller deficit than analysts were expecting.

Yes, Molycorp is still losing a considerable amount of money, but the adjusted loss of $0.15 a share was half as much as Wall Street was projecting. Molycorp also surprised analysts with a better-than-expected 9% sequential uptick in revenue.

SandRidge Energy (NYSE: SD  ) was also fueled by better-than-forecast results on the bottom line. The oil and gas explorer broke even on an adjusted basis. Sure, SandRidge had been profitable in each of the six previous quarters, but analysts were bracing for a loss of $0.06 a share this time around.

Finally, we have CenturyLink  (NYSE: CTL  ) coming through with encouraging bottom-line results. Its adjusted profit of $0.76 a share was ahead of the $0.68 a share it posted a year earlier. The pros were targeting flat earnings growth.

It was a busy week for regional telcos as CenturyLink joined Windstream (NASDAQ: WIN  ) and Frontier Communications (NASDAQ: FTR  ) in reporting financials. All three companies posted slightly lower revenue as rural landline customers continue to disconnect. Windstream and Frontier also missed on the bottom line. However, after CenturyLink slashed its dividend earlier this year and Frontier cut its rate last year, there were no payout whacks this time around. None of the three stocks lost ground on the week, and that's good news.

Moving in the right direction
It's important to keep watching the companies that surpass expectations. Over time, it will be a lucrative experience for investors as the market rewards the overachievers. That's the kind of surprise that we look for in the Rule Breakers newsletter service. Want in? Check out a 30-day trial subscription.

SandRidge plummeted when natural gas prices reached 10-year lows, but with the company focusing on growing liquids production, the future looks optimistic. If you are unsure about the future of this emerging oil and gas junior and are looking to find out more about its strengths and weaknesses, then check out The Motley Fool's premium research report detailing SandRidge's game plan and what to expect from the company going forward. To get started, simply click here now!

Is Nokia Done?

The following video is from Thursday's Investor Beat, in which host Chris Hill, and analysts Jeff Fischer and Jason Moser dissect the hardest-hitting investing stories of the day.

Shares of Nokia (NYSE: NOK  ) plunged on Thursday after the company reported a big decline in mobile phone sales. Nokia's Lumia sales hit a record high, but declined in North America. Is the market overreacting to Nokia's earnings? Should investors buy the embattled tech giant? In this installment of Investor Beat, our analysts discuss the future of Nokia.

Nokia's been struggling in a world of Apple and Android smartphone dominance. However, the company has banked its future on its next generation of Windows smartphones. Motley Fool analyst Charly Travers has created a new premium report that digs into both the opportunities and risks facing Nokia to help investors decide if the company is a buy or sell. To get started, simply click here now.

The relevant video segment can be found between 0:14 and 2:05

This Is One Incredible CEO

The Motley Fool's readers have spoken, and I have heeded your cries. After months of pointing out CEO gaffes and faux pas, I've decided to make it a weekly tradition to also point out corporate leaders who are putting the interests of shareholders and the public first and are generally deserving of praise from investors. For reference, here's my previous selection.

This week, we're going to turn our attention to some tasty brews and highlight why Martin Roper, CEO of Boston Beer (NYSE: SAM  ) , is one incredible leader.

Kudos to you, Mr. Roper
If you go out on a Friday night to your local pub, chances are very good you'll see a packed house. For us lifetime investors out there, we're always on the lookout for the next sustainable and revolutionary idea. Even as a beer connoisseur myself, I'm not sure I'd go so far as to call the brewing process revolutionary, but I'd have figured with some certainty that the price inelasticity and brand-name popularity of the alcohol business would provide gains in time of growth and recession. Unfortunately, for many beer and spirit producers, that's just not the case.

Many mass-produced beer companies, such as Anheuser-Busch InBev (NYSE: BUD  ) and Molson Coors (NYSE: TAP  ) , have struggled in domestic markets since the recession as consumers have opted for even cheaper beers, or have decided to pay a premium for craft beers and made the move toward Boston Beer or other small craft brewers. In 2010, for example, sales of Budweiser dropped 7.3% while Miller High Life saw sales dip 4%. This same year saw Sam Adams tack on a gain of 1.7%! This doesn't even take into account the fact that domestic competition has spiked, with the number of brewers in the U.S. jumping from just 89 in the late 1970s to more than 2,400 by the end of 2012, according to the Brewers Association.

Despite this massive increase in competition and more challenging spending habits from consumers, Boston Beer -- maker of the Sam Adams line of beers -- has flourished. Founded in 1984 and working its way from the ground up, Boston Beer has relied on its small-guy image to lay claim to 1% of the domestic beer market, or about 3 million barrels of beer each year. For the entirety of 2012, Boston Beer witnessed shipment volume growth of 10% and a robust gross margin of 54.3%.

One of the keys to success for Boston Beer has to do with its chairman and founder, Jim Koch, and its current CEO, Martin Roper, working so closely to grow the brand. In the 29 years since its founding, Boston Beer has had just two CEOs, which is honestly incredible given the revolving door that the CEO position has become over the past decade in nearly all industries. With two long-tenured individuals leading Boston Beer, the leaders and board remain focused and investors spend little time worrying about what's been solid corporate governance up to this point.

Understanding that its customer base demands a wide variety of options is another way that Boston Beer has excelled. There are more than 50 different varieties of Sam Adams sold throughout the world that cater to the many different palates and diets that exist. With essentially a beer for everyone, Sam Adams has encompassed a global audience without sacrificing the individuality that makes it the largest craft brewer.

A step above his peers
In addition to delivering fantastic top- and bottom-line results, Boston Beer has been known to do right by its investors, its employees, and in the community.

Although Boston Beer doesn't pay a dividend (something you can find with Molson Coors or Anheuser-Busch InBev), it makes up for it with phenomenal growth that's resulted in 1,116% share price appreciation over the past decade. So even without a dividend, shareholders have done pretty well.

Boston Beer's employees are doing well, too. One incredible perk is that many employees enjoy a flexible scheduling policy that allows them to choose their own hours to work. In Boston, the company's headquarters, employees often get to work from their homes twice a week. In addition to flexible scheduling, employees are given two free cases of Sam Adams beer each month, are privy to monthly cake and beer parties to celebrate employee birthdays, and are encouraged to participate in the company's annual Homebrew competition. Best of all, the company supplies all the materials needed to brew your own concoction.

Seeing as Boston Beer has a tightly knit employee base, it only makes sense that the company is a big community giver as well. As my Foolish colleague Daniel Ferry has pointed out recently, Boston Beer is a beer industry financier, lending money to start-up brewers and coaching them on how to properly run their business. It also donated 40,000 pounds of its own hops to struggling brewers during the hop shortage of 2008.

Two thumbs up
Breaking into a beer market dominated by just a few behemoths wasn't easy, but founder Jim Koch and current CEO Martin Roper have done an amazing job at building Boston Beer on the premise of providing ample choices to consumers, building up the value of its employees, and giving back to the craft beer community. With more than 50 beers to choose from, a rapidly growing revenue stream, and a management team that's always on course, it's not hard to see why Martin Roper is an incredible CEO and is most worthy of two thumbs up.

Should this stock make you all bubbly inside?
Boston Beer's Samuel Adams brand helped to redefine beer and kick off the craft beer revolution in the United States. Success breeds competition, though, and while just a few years ago Boston Beer had claim over most of the craft beer shelf, today the field is crowded. Can Boston Beer rise above the rest, or will it be squeezed between small local breweries on one side and global beer giants on the other? To help you decide, we've compiled a premium research report filled with everything you need to know about Boston Beer's risks and opportunities. Just click here now to find out whether Boston Beer is a buy today.

Toyota recalls another 1.75 million cars

HONG KONG (CNNMoney) Toyota has issued three new recalls covering more than 1.75 million vehicles, the latest in a string of safety setbacks for the automaker.

The largest of the three recalls, which mostly covers vehicles sold in Japan, is needed to fix a problem in the brake systems of select Crown Majesta, Noah and Voxy models, the company said in an email. In some cases, brake performance could begin to gradually degrade if the problem is not fixed.

A second recall of 759,000 vehicles includes 423,000 Lexus models in the United States made between 2005 and 2010. The automaker is seeking to fix an issue with fuel delivery pipes that could increase the risk of a vehicle fire.

The third recall is restricted to 190,000 cars sold in Japan that may develop fuel leaks.

In all three cases, Toyota said it was not aware of any crashes, injuries, or fatalities that have resulted from the issues. Nearly two-thirds of the recalled vehicles were sold in Japan.

  Meet a million-dollar Toyota

The new announcements will add substantially to Toyota's total recall number for the year. The company has already issued recalls over software problems and faulty airbags.

Earlier this year, Toyota agreed to pay a $1.2 billion fine -- the largest of its kind -- to settle a criminal probe into its conduct during its unintended acceleration recall of more than 10 million cars four years ago.

GM recalls reach 30 million for year

Auto recalls have captured the public's attention this year, especially in the U.S., where General Motors has come under fire for its handling of an ignition switch flaw tied to at least 23 deaths. GM has recalled more than 30 million vehicles so far in 2014.

-- CNN's Yoko Wakatsuki contributed reporting from Tokyo.

U.S. Stocks Rebound; Dow Climbs 167 Points

Are investors looking for bargains? Today's rebound by the major U.S. stock indices following yesterday's rout suggests so.

Data showing the U.S. economy grew at its fastest pace in more than two years in the second quarter boosted the Dow Jones Industrial Average on Friday while news that Bill Gross is leaving Pimco shook the bond market.

The Dow climbed 167 points, or 0.99% to 17,113.15 with Nike (NKE) leading the charge, rising 12% to $89.50 after posting fiscal first-quarter financial results that blew away the Street's forecasts.

The S&P 500 rose 16.9 points, or 0.9% to 1,982.85, while the Nasdaq Composite jumped 45.5 points, or 1% to 4,512.

And the Russell 2000 climbed 9.1 points, or 0.8% to 1,119.33.

The yield on the 10-year Treasury note, meanwhile, rose 1% to 2.53%. Bond yields rise as prices fall.

The U.S. economy grew at a 4.6% annual pace in the second quarter. The increase in real GDP was revised up from 4.2% amid higher exports and business investment, the Commerce Department said Friday. The biggest gains came in business investment, which strategists say is a good sign for the economy.

Worries about the economy we one of several factors blamed for Thursday's stock market selloff, which led to the biggest one-day drop by the Dow since July

"Yesterday was more about terrorism and geopolitics," argues Brent Schutte, senior investment strategist at BMO Global Asset Management. "I do not buy the notion the economy is weakening. Look at today's GDP data.

General Electric: Expect ‘Busy and Complex’ Earnings Call

Bernstein’s Steven Winoker thinks General Electric (GE) will beat earnings:

Bloomberg

We anticipate at least a 1-cent headline beat in the quarter. Of the 40 cents in our forecast earnings per share, we expect ~20 cents from GE Industrial, 4 cents above 2Q13, and ~20 cents from GE Capital, the same as 2Q13. We anticipate GAAP EPS from continuing ops of 36 cents. We do anticipate gains in the quarter, including from the sale of the Wayne fuel business, and the potential for tax effects in GE Capital from the sale of Nordic GE Money Bank, along with the “normal” real estate gains that show up in GE Capital continuing ops. The company has guided to ~$1-1.5B in restructuring in 2014, and gains from the Wayne and Nordic sales could be used to “cover” some of these costs…

Of course, two major points of interest this quarter will be Alstom and Synchrony, and we look forward to additional progress updates on both fronts. Recall too that General Electric has targeted ~$4B of other divestitures (including the rail signaling business). Between those items, and the potential for one-timers mentioned above, we expect this to be a busy and complex earnings call with General Electric.

Shares of General Electric have gained 1.1% to $26.49 at 2:14 p.m. today. It reports earnings on July 18.

Sardar Biglari's 2013 Letter To The Shareholders Of Biglari Holdings

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PIMCO’s Gross Cruises Into ‘New Neutral’

Following up on his May investment outlook, in which he argued that “If the neutral policy rate was 2% instead of 4% then bonds, instead of being artificially priced, would be attractively priced,” in his June commentary, PIMCO’s Bill Gross goes deeper into the neutral policy rate debate, arguing that the real neutral rate should be at zero or close to it. He also conveniently provides a shortened takeaway of his latest thoughts:

That’s helpful, but the popular takeaway from his latest monthly commentary will probably be (if social media is any guide): Bill Gross doesn’t own a cellphone.

Gross begins his June investment outlook by lamenting that the younger generation is trying to freeze time, using handheld devices like, umm, a cell phone to “record and memorialize” events for other’s viewing pleasure or for future consumption. “My view is that there is time stored in that cellphone, but its vintage may be somewhat sour, as compared to the sweetness of the here and now,” he writes. He then cites a Pew study on the heavy use of texting by American teenagers who “may get so caught up in their frantic ‘busyness’ that they fail to capture their present.”

So he pleads instead for “living in the moment.” As for cellphones, “They may be virtual, but they’re not reality.”

Then he gets into the meat of his commentary, saying “PIMCO’s reality in recent months has been captured by the phrase “The New Neutral,” defined as a real Federal Reserve Fed Funds rate of 0%, or perhaps even a little below 0%. Moreover, that zero rate, citing work done by Thomas Laubach and John Williams of the Fed, has declined “from over 4% in early 1970 to below 2% (and heading lower) today. Their most recent calculation of the current 'cyclical' rate is actually -0.25%.” Gross argues that when it comes to this New Neutral rate, “things are just gonna be this way for at least the next 3–5 years, and likely much more.”

So what does a “neutral” rate mean? Gross says Janet Yellen’s Federal Reserve answers it as “the rate consistent with full employment trend growth and stable prices.” He then quotes Yellen when she was San Francisco Fed President in 2005: “Research suggests that the neutral real rate depends on a variety of factors – the stance of fiscal policy, the trend of the global economy … the level of housing prices, the equity markets, the slope of the yield curve ... and it changes over time.”

Gross says PIMCO “cannot quarrel with such logic” before suggesting that the New Neutral real rate is also determined by two other factors: slower labor force growth and productivity and financial system leverage. He then cites Paul McCulley’s past research on “The New Neutral” (McCulley just rejoined PIMCO as chief economist, reporting to Gross) in which he argued, said Gross, that “the price of ‘real’ short-term credit” should be “close to 0% real because there was so much of it that was finance as opposed to real economy related.”

Then Gross makes his argument as to why “the more finance-based and highly levered an economy is, the lower and lower real yield levels should be to prevent a Lehman-like earthquake.”

We should “get used to” real rates of 0–50 basis points, which would benefit bondholders rather than savers, concluding that “becoming a conservative debtor while structuring a portfolio appears to make common sense.” He suggests that such low real policy rates, which “will be frigidly low for an extended period of time,” will require a new approach to portfolio management. 

PIMCO itself continues to struggle with outflows from its mutual funds. Morningtar reported in mid-May that in April, the bond shop had total net outflows of $5.5 billion, bringing its year-to-date outflows to some $21 billion, and its 12-month outflows to nearly $80 billion.

---

Bill Gross found a home on the IA 25 list this year. View his extended profile here.

Check out PIMCO’s Gross: Pop Your Bubble Fears! on ThinkAdvisor.

 

RadioShack – The Vultures Are Circling RSH Stock. Should You Be?

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RadioShack (RSH) just can't buy a break.

RadioShack’s plans to close 1,100 stores over the next five years were scuttled by lenders in mid-May when the terms for allowing it to do so were deemed unacceptable by RSH management and board. As a result, it's closing fewer stores and will instead find other ways to cut costs.

The move ramps up RadioShack’s losses, hurting whatever life is left in RSH stock.

The vultures are circling.

Does RadioShack have any chance of avoiding bankruptcy? Credit default swaps protecting against non-payment of debt indicate there's an 86% chance of default by June 2015.

With the company's best option for reducing its cost structure gone and vendors holding all the cards, the odds of a recovery in RSH stock get slimmer by the day. Thing is, battered companies toying with destruction do, on occasion, reward the speculative bull. But is RSH stock one of those kinds of plays?

Here's how I see it.

How RadioShack Turns It Around

RadioShack closed at $1.21 heading into the Memorial Day holiday weekend. RSH stock hasn't been this low since 1978 — six presidents have served in the White House in that time.

While it only has to lose $1.21 to go to zero, a 100% increase in the value of its stock would put it at $2.42 — still 54% lower than its 52-week high of $4.36.

The upside is certainly much greater than the downside at this point.

Although RadioShack's slow death march has been ongoing for some time, it really didn't pick up speed until 2010. However, in 2013 — well after its demise had begun in earnest — RadioShack hired Joe Magnacca away from Walgreen (WAG) just a week after being promoted to executive vice president of the nation's largest drug store chain.

Magnacca was an up-and-comer at Walgreen, but he opted for a Herculean challenge over another promotion. It's that kind of determination and drive that could ultimately reignite RSH stock.

Magnacca has been at the job for 16 months now, and he continues to tinker with RadioShack's management to provide the best customer experience possible while generating a profit. Joe Magnacca's five-point plan is going to take time, however. One of the five pillars of the plan took a big hit with the decision to reduce the number of store closings, but otherwise not much has changed at RadioShack when it comes to its turnaround.

As long as liquidity remains, Magnacca et al. will continue to push its "do-it-together" mantra with customers. That's its best shot to win back customers and push RSH stock higher.

How RSH Stock Hits Zero

As I mentioned, there is a good chance RadioShack could default on its loans.

Next Page

In addition to Bloomberg’s research, Markit research suggests that credit default swaps imply a 40% chance of default by the end of this year and a 95% chance by the end of 2019, according to Financial Times. Fitch recently downgraded RadioShack's credit rating to CC from CCC, stating that it's "increasingly concerned about the RadioShack's ability to operate beyond 2014 given the significant cash burn in the business … [there is] no apparent catalyst for a turnaround."

Any further downgrades would most certainly spell the end for RSH stock, as bankruptcy would be imminent.

With holiday 2014 only six months away, vendors are becoming increasingly scared that they won't be paid for merchandise shipped. That's going to hamper RadioShack's move to re-merchandise its stores. If it doesn't get the right mix to drive sales for the holiday season, it will most certainly run out of cash by the end of 2014. If that happens, you can be sure bankruptcy is just around the corner.

Once again, what's good for the lenders isn't necessarily good for shareholders and RSH stock.

Bottom Line

You shouldn't consider RSH stock and this speculative bet if you can't afford to lose every penny — because it has a very good chance of happening.

While it was admirable for Magnacca to take on this impossible task, he'll be compensated handsomely regardless of what happens. He's not going anywhere through the end of 2015.

So the question is whether you think he already has earned enough — $1 million signing bonus in 2013 plus $300,000 for getting its concept store developed and $1.3 million in non-equity cash compensation including salary — to stop caring about the 3.5 million shares of RSH stock he's been awarded and would forfeit in the event of a bankruptcy.

Personally, I don't think so, despite the fact RadioShack's bankruptcy could be deemed a change of control and worth $5.7 million to Magnacca in any subsequent termination. While the lenders are beyond his control, I believe Magnacca's going to do everything in his power to keep RSH stock afloat because he knows if it hits $10, he's worth considerably more than if it goes into the tank — regardless of his severance.

While I'm no expert on selling put options, the July 2014 $1 strike looks like a good way to play RSH stock. If it goes up over the next two months, you earn some very good income. If RSH gets put to you, you've bought its stock at a 17% discount to its May 23 closing price.

Although I do think there's a good possibility RSH stock won't be trading this time next year, I also believe hedge funds are buying at these prices. If you've got $5,000 to throw away, the upside rewards are much greater than the downside risk. If it goes to zero you've lost $5,000. If it goes to $10, you'll be sitting on eight times your original investment.

No risk, no reward.

As of this writing, Will Ashworth did not hold a position in any of the aforementioned securities.

2 Stocks With Bullish Insider Buying

Popular Posts: 3 ‘Double Whammy’ Tech Stocks to SellBank Stocks Are About to Get Much More Attractive3 Dividend Growth Stocks to Buy Recent Posts: 2 Stocks With Bullish Insider Buying Bank Stocks Are About to Get Much More Attractive 3 ‘Double Whammy’ Tech Stocks to Sell View All Posts

There has been a lot of talk — including a fair amount from me — about the increase in insider selling as markets have moved higher. Officers and directors of U.S. corporations have been selling a lot more stock that they have been buying in the companies they oversee.

Given this backdrop, when I see clusters of insider buying, I take notice.

Buying in the current elevated market indicates a high degree of confidence in the direction of your company — and your stock's ability to do well regardless of market conditions. I ran a screen to see which companies had seen some heavy insider buying recently, and there are some interesting names on the list.

Tile Shops Holdings (TTS) came public back in 2012 and was initially a hot deal, doubling in the months after the deal was priced. It has been pretty much downhill from there, and the shares have lost half their peak value and are back near the offering price.

The company has 91 stores selling manufactured and natural stone tiles, setting and maintenance materials. There were questions about the company involvement with a Chinese exporter that was owned by the CEO's brother-in-law. The investigation dragged on longer than expected but finally concluded with a finding of no serious wrongdoing by the company or its officials.

Insiders believe the business will continue to prosper and the stock is now positioned to recover. Four different officers and directors have purchased more than 145,000 shares in the past month.

One of the really interesting stocks on the list is Clean Energy Fuels Corporation (CLNE). The company operates fueling stations that allow vehicle fleets to use natural gas to run their vehicles. CLNE also sells compressed natural gas for light-, medium- and heavy-duty vehicles; and liquefied natural gas for medium- and heavy-duty vehicles. CLNE has a pretty good customer base, with 779 fleet customers operating approximately 35,240 natural gas vehicles.

While the use of nat-gas-fueled cars has not taken off as fast as many had hoped, you can file it under "has to happen" as we continue to reach for true energy independence. T. Boone Pickens has been a pretty shrewd energy investor over the year and he is the largest shareholder of the company. The stock is down more than 30% in the past year, and at least three directors think it is nearing a bottom — they opened their checkbooks and bought a total of 47,000 shares in the past month, worth $438,000.

These are two most interesting companies that have shown insider cluster buying in the past two months. I have always wondered why so few investors pay any attention to the buying and selling activities of the people actually running the companies. While not foolproof, this information has proved to be a strong sign of much higher prices over the next few years.

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

Pension Advocates Blast Budget’s Premium Hike

The two-year budget deal struck by Rep. Paul Ryan, R-Wis., and Sen. Patty Murray, D-Wash., sailed through the House of Representatives on Thursday by a 332-94 vote. The deal is expected to pass the Senate next week.

The agreement sets spending levels at just above $1 trillion for fiscal 2014 and 2015 and eliminates $63 billion in automatic sequestration cuts. New spending increases would be offset by increasing the amount federal workers must contribute to their retirement plans as well as increasing premiums for pensions backed by the Pension Benefit Guaranty Corp.

The American Benefits Council balked at the $8 billion in PBGC premium hikes that are to be paid by employer plan sponsors under the measure. The pension premium increase, said ABC President James Klein, “follows a $9 billion increase in premiums enacted just a year ago.”

Klein said in a statement that “It is simply unacceptable that members of Congress of both parties, as well as both Democratic and Republican administrations in recent years, view pension plans as a piggy bank for other budget priorities, without regard for the real-life policy implications of their actions.”

As the Bipartisan Budget Act of 2013 notes, the sequester relief is fully offset by savings elsewhere in the budget, which includes “dozens of specific deficit-reduction provisions, with mandatory savings and non-tax revenue totaling approximately $85 billion.” The agreement says it would reduce the deficit by between $20 billion and $23 billion.

Securities and Exchange Commission spokesman John Nester told ThinkAdvisor Friday that there are “no details at present” on how the budget deal impacts the agency.

Lawmakers and the executive branch, Klein argued, “sometimes cite the PBGC’s self-reported $36 billion deficit to justify new premium increases.” However, he said the current PBGC deficit projection is “highly misleading and is based on both today’s historically low interest rates and flawed assumptions by the PBGC in the way it determines its financial situation.”

Said Klein: “Today’s $36 billion ‘deficit’ is no more real than its purported $11 billion ‘surplus’ several years ago when interest rates were high.”

While the Federal Reserve Board’s low-interest rate policy “is appropriately designed to help spur economic recovery," Klein added, "it has the perverse effect of undervaluing pension assets, understating the funding levels of employer-sponsored plans and the financial position of the PBGC itself.”

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Check out Don’t Break Our Thriving 401(k) System, Groups Urge Government on ThinkAdvisor.

Court case could mean ‘death’ of software patents

WASHINGTON (AP) — The Supreme Court decided Friday to hear an appeal of a lower court decision that a federal judge called the "death" of software patents.

In a worst-case scenario for the high-tech industry, if the Supreme Court upholds the ruling it could invalidate many existing software patents or at least make them more difficult to defend in lawsuits.

Justices decided to hear an appeal from electronic marketplace Alice, in its attempt to patent its computer-implemented escrow systems, software, and methods. It is being challenged by CLS Bank International.

The Supreme Court has already ruled that abstract ideas, natural phenomena and laws of nature cannot be patented but has refused so far to decide whether software, online-shopping techniques and medical diagnostic tests fit into that realm.

The U.S. Court of Appeals for the Federal Circuit determined that Alice's patents couldn't be granted. Five of the 10-member panel agreed that Alice's attempt to patent its way of using third-party escrow accounts to overcome the risks of fraud and non-payment were not eligible to be patented. The other judges concurred in part and dissented in part.

Dissenting judges called the decision potentially disruptive to the patent system.

"Let's be clear: if all of these claims, including the system claims, are not patent-eligible, this case is the death of hundreds of thousands of patents, including all business method, financial system, and software patents as well as many computer implemented and telecommunications patents," said Judge Kimberly Moore.

"There has never been a case which could do more damage to the patent system than this one," said Judge Pauline Newman.

Tech companies say software patents have played a critical role in keeping the U.S. at the cutting edge by giving people control over their inventions for nearly 20 years.

Justices will hear the case next year.

The case is 13-298, Alice Corp., v. CLS Bank International.